Document:

d867882_ex4-11.htm

    

    Exhibit
4.11

    
      	
              Private
      & Confidential

            
	 
	
               

               

            
	
               

               

               

               

            
	
               

               

            
	
               

               

            
	 
      
	
              LOAN AGREEMENT

              for
      a Loan of up to

              US$47,000,000

              to

              IASON
      OWNING COMPANY LIMITED

               

              provided
      by

              EFG
      EUROBANK ERGASIAS S.A.

            
	
               

               
      

            	 
      	 
      
	
               

               

               

               

               

               

               

            

    

     

     

    

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    Contents

     

     

    

    

      
        	Clause 	 	Page 
	
                 

              	
                 

              	
                 

              
	1	Purpose
      and definitions	
                1

              
	 	 	 
	
                2

              	
                The
      Commitment and the Loan

              	
                8

              
	 	 	 
	
                3

              	
                Interest
      and Interest Periods

              	
                9

              
	 	 	 
	
                4

              	
                Repayment
      and prepayment

              	
                11

              
	 	 	 
	
                5

              	
                Fees,
      commitment commission and expenses

              	
                12

              
	 	 	 
	
                6

              	
                Payments
      and taxes; accounts and calculations

              	
                13

              
	 	 	 
	
                7

              	
                Representations
      and warranties

              	
                14

              
	 	 	 
	
                8

              	
                Undertakings

              	
                18

              
	 	 	 
	
                9

              	
                Conditions

              	
                24

              
	 	 	 
	
                10

              	
                Events
      of Default

              	
                24

              
	 	 	 
	
                11

              	
                Indemnities

              	
                28

              
	 	 	 
	
                12

              	
                Unlawfulness
      and increased costs

              	
                29

              
	 	 	 
	
                13

              	
                Security
      and set-off

              	
                30

              
	 	 	 
	
                14

              	
                Accounts

              	
                31

              
	 	 	 
	
                15

              	
                Assignment,
      transfer and lending office

              	
                33

              
	 	 	 
	
                16

              	
                Notices
      and other matters

              	
                34

              
	 	 	 
	
                17

              	
                Governing
      law and jurisdiction

              	
                35

              
	 	 
	 	 
	
                Schedule
      1 Form of Drawdown Notice

              	
                36

              
	
                 

              	 
	
                Schedule
      2 Documents and evidence required as conditions precedent to
      the  Loan being made

              	
                37

              
	 	 
	
                Schedule
      3 Form of Corporate Guarantee

              	
                41

              
	 	 
	
                Schedule
      4 Form of Mortgage

              	
                42

              
	 	 
	
                Schedule
      5 Form of Deed of Covenant

              	
                43

              
	 	 
	
                Schedule
      6 Form of Manager’s Undertaking

              	
                44

              
	 	 
	
                Schedule
      7 Form of Master Swap Agreement

              	
                45

              
	 	 
	
                Schedule
      8 Form of Master Agreement Security Deed

              	
                46

              

      

    

     

     

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    THIS AGREEMENT is dated 16
November 2007 and made BETWEEN:

     

    
      	
              (1)  

            	
              IASON OWNING COMPANY LIMITED
      as Borrower; and

            

    

     

    
      	
              (2)  

            	
              EFG EUROBANK ERGASIAS
      S.A. as Bank.

            

    

     

    IT IS AGREED as
follows:

     

    
      	
              1  

            	
              Purpose and
definitions

            

    

     

    
      	
              1.1  

            	
              Purpose

            

    

     

    This
Agreement sets out the terms and conditions upon and subject to which the Bank
agrees to make available to the Borrower a loan of up to Forty seven million
Dollars ($47,000,000) to be used for the purpose of financing part of the cost
of the purchase of the Ship.

     

    
      	
              1.2  

            	
              Definitions

            

    

     

    In this
Agreement, unless the context otherwise requires:

     

    “Accounts” means, together, the
Earnings Account and the Retention Account and “Account” means either of
them;

     

    “Accounts Pledges” means,
together, the Earnings Account Pledge and the Retention Account Pledge and
“Account Pledge” means
either of them;

     

    “Applicable Accounting
Principles” means the most recent and up-to-date US GAAP at any relevant
time;

     

    “Assignee” has the meaning
ascribed thereto in clause 15.3;

     

    “Balloon Instalment” has the
meaning ascribed thereto in clause 4.1;

     

    “Bank” means EFG Eurobank
Ergasias S.A. whose registered office is at 8 Othonos Street, Athens 105 57,
Greece acting (a) for the purposes of this Agreement through its office at 83
Akti Miaouli & Flessa Street, Piraeus 185 38, Greece (or of such other
address as may last have been notified to the Borrower pursuant to
clause 15.6) and (b) for the purposes of the Master Swap Agreement through
its head office at 8 Othonos Street, Athens 105 57, Hellenic Republic and/or its
branch at 24 Grafton Street, London W1S 4EZ, England and includes its successors
in title, Assignees or Transferees;

     

    “Banking Day” means a day on
which dealings in deposits in Dollars are carried on in the London Interbank
Market and (other than Saturday or Sunday) on which banks are open for business
in London, Piraeus and New York City (or any other relevant place of payment
under clause 6);

     

    “Borrowed Money” means
Indebtedness incurred in respect of (i) money borrowed or raised and debit
balances at banks, (ii) any bond, note, loan stock, debenture or similar debt
instrument, (iii) acceptance or documentary credit facilities, (iv) receivables
sold or discounted (otherwise than on a non-recourse basis), (v) deferred
payments for assets or services acquired, (vi) leases and hire purchase
contracts, (vii) swaps, forward exchange contracts, futures and other
derivatives, (viii) any other transaction (including without limitation forward
sale or purchase agreements) having the commercial effect of a borrowing or
raising of money or of any of (ii) to (vii) above and (ix) guarantees in respect
of Indebtedness of any person falling within any of (i) to (vii)
above;

     

    “Borrower” means Iason Owning
Company Limited of Trust Company Complex, Ajeltake Road, Ajeltake Island,
Majuro, Republic of the Marshall Islands MH96960 and includes its successors in
title;

     

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    “Borrower's Security Documents”
means, at any relevant time, such of the Security Documents as shall have been
executed by the Borrower at such time;

     

    “Charter” means any time or
voyage charterparty for a term which exceeds or by virtue of any optional
extensions therein contained might exceed twelve (12) months’ duration which may
be entered into by the Borrower with a Charterer during the Security
Period;

     

    “Charter Assignment” means an
assignment of any Charter executed or (as the context may require) to be
executed by the Borrower in favour of the Bank in such form as the Bank may
require in its sole discretion if a Charter is entered into by the Borrower with
a Charterer;

     

    “Charterer” means such person
as shall be acceptable to the Bank which shall enter into a charterparty in
respect of the Ship with the Borrower;

     

    “Classification” means the
classification +A1, Bulk Carrier, +AMS, +ACCU, SH, HCS with the Classification
Society or such other classification as the Bank shall, at the request of the
Borrower, have agreed in writing shall be treated as the Classification for the
purposes of the Security Documents;

     

    “Classification Society” means
American Bureau of Shipping or such other classification society which the Bank
shall, at the request of the Borrower, have agreed in writing shall be treated
as the Classification Society for the purposes of the Security
Documents;

     

    “Code” means the International
Management Code for the Safe Operation of Ships and for Pollution Prevention
constituted pursuant to Resolution A.741(18) of the International Maritime
Organization and incorporated into the International Convention for the Safety
of Life at Sea 1974 (as amended) and includes any amendments or extensions
thereto and any regulation issued pursuant thereto;

     

    “Commitment” means the amount
which the Bank has agreed to lend to the Borrower under clause 2.1 as
reduced by any relevant term of this Agreement;

     

    “Compulsory Acquisition” means
requisition for title or other compulsory acquisition, requisition,
appropriation, expropriation, deprivation, forfeiture or confiscation for any
reason of the Ship by any Government Entity or other competent authority,
whether de jure or de facto, but shall exclude requisition for use or hire not
involving requisition of title;

     

    “Confirmation” shall have, in
relation to any continuing Designated Transaction, the meaning ascribed to it in
the Master Swap Agreement;

     

    “Contract” means the memorandum
of agreement dated 13 July 2007, made between (inter alios) the Seller and the
Corporate Guarantor, as amended and supplemented by an Addendum No. 1 thereto
dated 17 July 2007 and made between the Seller, the Corporate Guarantor and the
Borrower (pursuant to which the Corporate Guarantor has nominated the Borrower
as buyer) and by an Addendum No. 2 thereto dated 15 October 2007 and as may be
further amended and supplemented from time to time, relating to the sale by the
Seller, and the purchase by the Borrower, of the Ship;

     

    “Contract Price” means the
price payable by the Borrower to the Seller for the Ship in accordance with the
Contract, being the purchase sum of Sixty seven million one hundred and seventy
five thousand Dollars ($67,175,000) or such other sum as is determined in
accordance with the terms and conditions of the Contract to be the purchase
price for the Ship thereunder;

     

    “Corporate Guarantee” means the
corporate guarantee executed or (as the context may require) to be executed by
the Corporate Guarantor in favour of the Bank in the form or substantially the
form set out in schedule 3;

     

    “Corporate Guarantor” means
DryShips Inc. of Trust Company Complex, Ajeltake Island, P.O.Box 1405, Majuro,
Marshall Islands MH96960, and includes its successors in title;

     

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    “Deed of Covenant” means the
deed of covenant collateral to the Mortgage executed or (as the context may
require) to be executed by the Borrower in favour of the Bank in the form or
substantially the form set out in schedule 5;

     

    “Default” means any Event of
Default or any event or circumstance which with the giving of notice or lapse of
time or the satisfaction of any other condition (or any combination thereof)
would constitute an Event of Default;

     

    “Delivery” means the delivery
of the Ship by the Seller to the Borrower, and the acceptance of the Ship by the
Borrower pursuant to the Contract;

     

    “Delivery Date” means the date
upon which Delivery occurs;

     

    “Designated Transaction” means
any Transaction which is entered into by the Borrower pursuant to the Master
Swap Agreement with the Bank as contemplated by clause 2.7;

     

    “DOC” means a document of
compliance issued to an Operator in accordance with rule 13 of the
Code;

     

    “Dollars” and “$” mean the lawful currency of
the United States of America and in respect of all payments to be made under any
of the Security Documents mean funds which are for same day settlement in the
New York Clearing House Interbank Payments System (or such other U.S. dollar
funds as may at the relevant time be customary for the settlement of
international banking transactions denominated in U.S. dollars);

     

    “Drawdown Date” means the date,
being a Banking Day falling not later than the Termination Date, on which the
Loan is, or is to be, drawn down;

     

    “Drawdown Notice” means a
notice substantially in the form of schedule 1;

     

    “Early Termination Date” shall
have, in relation to any continuing Designated Transaction, the meaning ascribed
to it in the Master Swap Agreement;

     

    “Earnings” means all money
whatsoever from time to time due or payable to the Borrower during the Security
Period (as such term is defined in the Deed of Covenant) arising out of the use
or operation of the Ship including (but without limiting the generality of the
foregoing) all freight, hire and passage moneys, income arising out of pooling
arrangements, compensation payable to the Borrower in the event of requisition
of the Ship for hire, remuneration for salvage or towage services, demurrage and
detention moneys and damages for breach (or payment for variation or
termination) of any charterparty or other contract for the employment of the
Ship and any sums recoverable under any loss of earnings insurance;

     

    “Earnings Account” means an
interest bearing Dollar account of the Borrower opened or (as the context may
require) to be opened by the Borrower with the Bank and includes any
sub-accounts thereof and any other account designated in writing by the Bank to
be an “Earnings Account” for the purposes of this Agreement;

     

    “Earnings Account Pledge” means
the pledge executed or (as the context may require) to be executed by the
Borrower in favour of the Bank, in respect of the Earnings Account, in such form
as the Bank may require in its sole discretion;

     

    “Encumbrance” means any
mortgage, charge (whether fixed or floating), pledge, lien, hypothecation,
assignment, trust arrangement or security interest or other encumbrance of any
kind securing any obligation of any person or any type of preferential
arrangement (including without limitation title transfer and/or retention
arrangements having a similar effect);

     

    “Environmental Affiliate” means
any agent or employee of the Borrower or any other Relevant Party or any person
having a contractual relationship with the Borrower or any other Relevant Party
in connection with any Relevant Ship or its operation or the carriage of cargo
and/or passengers thereon and/or the provision of goods and/or services on or
from such Relevant Ship;

     

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    “Environmental Approval” means
any consent, authorisation, licence or approval of any governmental or public
body or authorities or courts applicable to any Relevant Ship or its operation
or the carriage of cargo and/or passengers thereon and/or the provision of goods
and/or services on or from such Relevant Ship required under any Environmental
Law;

     

    “Environmental Claim” means any
and all enforcement, clean-up, removal or other governmental or regulatory
actions or orders instituted or completed pursuant to any Environmental Law or
any Environmental Approval together with claims made by any third party relating
to damage, contribution, loss or injury, resulting from any actual or threatened
emission, spill, release or discharge of a Material of Environmental Concern
from any Relevant Ship;

     

    “Environmental Laws” means all
national, international and state laws, rules, regulations, treaties and
conventions applicable to any Relevant Ship pertaining to the pollution or
protection of human health or the environment including, without limitation, the
carriage of Materials of Environmental Concern and actual or threatened
emissions, spills, releases or discharges of Materials of Environmental
Concern;

     

    “Event of Default” means any of
the events or circumstances described in clause 10.1;

     

    “Flag State” means the Malta or
such other state or territory designated in writing by the Bank, at the request
of the Borrower, as being the “Flag State” of the Ship for
the purposes of the Security Documents;

     

    “Government Entity” means and
includes (whether having a distinct legal personality or not) any national or
local government authority, board, commission, department, division, organ,
instrumentality, court or agency and any association, organisation or
institution of which any of the foregoing is a member or to whose jurisdiction
any of the foregoing is subject or in whose activities any of the foregoing is a
participant;

     

    “Group” means, together, the
Corporate Guarantor and its Subsidiaries from time to time and “member of the Group” shall be constructed
accordingly;

     

    “Indebtedness” means any
obligation for the payment or repayment of money, whether as principal or as
surety and whether present or future, actual or contingent;

     

    “Interest Payment Date” means
the last day of an Interest Period;

     

    “Interest Period” means each
period for the calculation of interest in respect of the Loan ascertained in
accordance with clauses 3.2 and 3.3;

     

    “ISPS Code” means the
International Ship and Port Facility Security Code constituted pursuant to
resolution A.924(22) of the International Maritime Organisation now set out in
Chapter XI-2 of the International Convention for the Safety of Life at Sea
(SOLAS) 1974 (as amended) and the mandatory ISPS Code as adopted by a Diplomatic
Conference of the International Maritime Organisation on Maritime Security in
December 2002 and includes any amendments or extensions to it and any regulation
issued pursuant to it;

     

    “ISSC” means an International
Ship Security Certificate issued in respect of the Ship pursuant to the ISPS
Code;

     

    “LIBOR” means, in relation to a
particular period, the rate determined by the Bank to be that at which deposits
in Dollars and in an amount comparable with the amount in relation to which
LIBOR is to be determined and for a period equal to the relevant period were
being offered by the Bank to prime banks in the London Interbank Market at or
about 11:00 a.m. on the second Banking Day before the first day of such
period;

     

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    “Loan” means the principal
amount borrowed by the Borrower on the Drawdown Date or (as the context may
require) the principal amount owing to the Bank under this Agreement at any
relevant time;

     

    “Management Agreement” means
the agreement dated 15 November 2007 made between the Borrower and the Manager
in respect of the Ship or any other agreement previously approved in writing by
the Bank between the Borrower and the Manager providing for the Manager to
manage the Ship;

     

    “Manager” means Cardiff Marine
Inc. of 80 Broad Street, Monrovia, Liberia or any other person appointed by the
Borrower, with the prior written consent of the Bank, as the manager of the
Ship, and includes its successors in title;

     

    “Manager’s Undertaking” means
the first priority manager’s undertaking and assignment executed or (as the
context may require) to be executed by the Manager in favour of the Bank in the
form or substantially the form set out in schedule 6;

     

    “Margin”
means zero point eight five per cent (0.85%) per
annum;

     

    
      “Master Agreement Security
Deed” means a security deed executed or (as the context may require) to
be executed by the Borrower in favour of the Bank in relation to certain of the
rights of the Borrower under the Master Swap Agreement in the form or
substantially the form set out in schedule 8;

       

    

    “Master Swap Agreement” means
the agreement made or (as the context may require) to be made between the Bank
and the Borrower comprising a 1992 ISDA Master Agreement
(Multicurrency-Crossborder) (including the schedule thereto) in the form or
substantially the form set out in schedule 7 and includes any Designated Transactions from time to time entered into and any
Confirmations (as defined therein) from time to time exchanged thereunder and
governed thereby;

     

    “Material of Environmental
Concern” means and includes pollutants, contaminants, toxic substances,
oil as defined in the United States Oil Pollution Act of 1990 and all hazardous
substances as defined in the United States Comprehensive Environmental Response,
Compensation and Liability Act 1980;

     

    “month” means a period
beginning in one calendar month and ending in the next calendar month on the day
numerically corresponding to the day of the calendar month on which it started,
provided that (i) if the period started on the last Banking Day in a calendar
month or if there is no such numerically corresponding day, it shall end on the
last Banking Day in such next calendar month and (ii) if such numerically
corresponding day is not a Banking Day, the period shall end on the next
following Banking Day in the same calendar month but if there is no such Banking
Day it shall end on the preceding Banking Day and “months” and “monthly” shall be construed
accordingly;

     

    “Mortgage” means the first
priority statutory Maltese mortgage of the Ship executed or (as the context may
require) to be executed by the Borrower in favour of the Bank in the form or
substantially the form set out in schedule 4;

     

    “Operator” means any person who
is from time to time during the Security Period (as defined in the Deed of
Covenant) concerned in the operation of the Ship and falls within the definition
of “Company” set out in rule 1.1.2 of the Code;

     

    “Permitted Encumbrance” means
any Encumbrance in favour of the Bank created pursuant to the Security Documents
and Permitted Liens;

     

    “Permitted Liens” means any
lien on the Ship for master's, officer's or crew's wages outstanding in the
ordinary course of trading, any lien for salvage and any ship repairer's or
outfitter's possessory lien for a sum not (except with the prior written consent
of the Bank) exceeding the Casualty Amount (as defined in the Ship Security
Documents);

     

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    “Registry” means the offices of
the Maltese Ship Registry in Valletta, Malta or such other registrar,
commissioner or representative of the Flag State who is duly authorised and
empowered to register the Ship, the Borrower's title to the Ship and the
Mortgage under the laws and flag of the Flag State through the
Registry;

     

    “Related Company” of a person
means any Subsidiary of such person, any company or other entity of which such
person is a Subsidiary and any Subsidiary of any such company or
entity;

     

    “Relevant Jurisdiction” means
any jurisdiction in which or where any Security Party is incorporated, resident,
domiciled, has a permanent establishment, carries on, or has a place of business
or is otherwise effectively connected;

     

    “Relevant Party” means the
Borrower, any other Security Party and any other member of the
Group;

     

    “Relevant Ship” means the Ship
and any other vessel owned, operated, managed or crewed by any Relevant
Party;

     

    “Repayment Dates” means,
subject to clause 6.3, each of the dates falling at three (3) monthly
intervals after the Drawdown Date up to and including the date falling ninety
six (96) months after the Drawdown Date;

     

    “Retention Account” means a
Dollar account of the Borrower opened or (as the context may require) to be
opened by the Borrower with the Bank and includes any sub-accounts thereof and
any other account designated in writing by the Bank to be a Retention Account
for the purposes of this Agreement;

     

    “Retention Account Pledge”
means a first priority pledge of the Retention Account executed or (as the
context may require) to be executed by the Borrower in favour of the Bank, in
such form as the Bank may in it sole discretion require;

     

    “Retention Amount” means, in
relation to any Retention Date, such sum as shall be the aggregate
of:

     

    
      	 	
              (a)  

            	
              one-third
      (1/3rd)
      of the repayment instalment falling due for payment pursuant to
      clause 4.1 (as the same may have been reduced by any prepayment) on
      the next Repayment Date after the relevant Retention Date;
    and

            

    

     

    
      	 	
              (b) 

            	
              the
      applicable fraction (as hereinafter defined) of the aggregate amount of
      interest falling due for payment in respect of each part of the Loan
      during and at the end of each Interest Period current at the relevant
      Retention Date and, for this purpose, the expression “applicable fraction” in
      relation to each Interest Period shall mean a fraction having a numerator
      of one and a denominator equal to the number of Retention Dates falling
      within the relevant Interest
Period;

            

    

     

    “Retention Dates” means the
date falling thirty (30) days after the Drawdown Date and each of the dates
falling at monthly intervals after such date and prior to the final Repayment
Date;

     

    “Security Documents” means this
Agreement, the Corporate Guarantee, the Mortgage, the Deed of Covenant, the
Manager’s Undertaking, the Account Pledges, the Master Swap Agreement, the
Master Agreement Security Deed, any Charter Assignment and any other documents
as may have been or shall from time to time after the date of this Agreement be
executed to secure all or any part of the Loan, interest thereon and other
moneys from time to time owing by the Borrower or any other Security Party
pursuant to this Agreement or the Master Swap Agreement or any other Security
Documents (whether or not any such document also secures moneys from time to
time owing pursuant to any other document or agreement);

     

    “Security Party” means the
Borrower, the Corporate Guarantor, the Manager or any other person who may at
any time be a party to any of the Security Documents (other than the
Bank);

     

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    “Security Requirement” means
the amount in Dollars (as certified by the Bank whose certificate shall, in the
absence of manifest error, be conclusive and binding on the Borrower and the
Bank) which is, at any relevant time, one hundred and thirty per cent (130%) of
the aggregate of (a) the Loan and (b) the Swap Exposure at such
time;

     

    “Security Value” means the
amount in Dollars (as certified by the Bank whose certificate shall, in the
absence of manifest error, be conclusive and binding on the Borrower and the
Bank) which is, at any relevant time, the aggregate of (a) the market value of
the Ship as most recently determined in accordance with clause 8.3.2 and
(b) the market value of any additional security for the time being actually
provided to the Bank pursuant to clause 8.3;

     

    “Seller” means Immortality
Shipping Co. Ltd. of Monrovia, Liberia and includes its successors in
title;

     

    “Ship” means the 74.205 dwt,
2002-built bulk carrier owned on the date of this Agreement by the Seller and
registered under the laws and flag of The Commonwealth of the Bahamas under IMO
No. 9214123 and to be registered on the Delivery Date in the ownership of the
Borrower through the Registry under the laws and flag of the Flag State with the
name Oregon;

     

    “Ship Security Documents” means
the Mortgage, the Deed of Covenant, any Charter Assignment and the Manager’s
Undertaking;

     

    “SMC” means a safety management
certificate issued in respect of the Ship in accordance with rule 13 of the
Code;

     

    “Subsidiary” of a person means
any company or entity directly or indirectly controlled by such person, and for
this purpose “control”
means either the ownership of more than fifty per cent (50%) of the voting share
capital (or equivalent rights of ownership) of such company or entity or the
power to direct its policies and management, whether by contract or
otherwise;

     

    “Swap Exposure” means, as at
any relevant time, the amount certified by the Bank to be the aggregate net
amount in Dollars which would be payable by the Borrower to the Bank under (and
calculated in accordance with) section 6(e) (Payments on Early Termination) of
the Master Swap Agreement if an Early Termination Date had occurred at the
relevant time in relation to all continuing Designated
Transactions;

     

    “Taxes” includes all present
and future taxes, levies, imposts, duties, fees or charges of whatever nature
together with interest thereon and penalties in respect thereof and “Taxation” shall be construed
accordingly;

     

    “Termination Date” means 25
February 2008 or such later date as the Bank may in its absolute discretion
agree in writing;

     

    “Total Loss”
means:

     

    
      	 	
              (a)  

            	
              actual,
      constructive, compromised or arranged total loss of the Ship;
      or

            

    

     

    
      	 	
              (b)  

            	
              the
      Compulsory Acquisition of the Ship;
or

            

    

     

    
      	 	
              (c)  

            	
              the
      hijacking, theft, condemnation, capture, seizure, arrest, detention or
      confiscation of the Ship (other than where the same amounts to the
      Compulsory Acquisition of the Ship) by any Government Entity, or by
      persons acting or purporting to act on behalf of any Government Entity,
      unless the Ship be released and restored to the Borrower from such
      hijacking, theft, condemnation, capture, seizure, arrest, detention or
      confiscation within thirty (30) days after the occurrence
      thereof;

            

    

     

    “Transaction” has the meaning
ascribed thereto in the Master Swap Agreement;

     

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    “Transferee” has the meaning
ascribed thereto in clause 15.4; and

     

    “Underlying Documents” means,
together, the Contract and the Management Agreement.

     

    
      	
              1.3  

            	
              Headings

            

    

     

    Clause headings
and the table of contents are inserted for convenience of reference only and
shall be ignored in the interpretation of this Agreement.

     

    
      	
              1.4  

            	
              Construction
      of certain terms

            

    

     

    In this
Agreement, unless the context otherwise requires:

     

    
      	
              1.4.1  

            	
              references
      to clauses and schedules are to be construed as references to
      clauses of, and schedules to, this Agreement and references to
      this Agreement include its
schedules;

            

    

     

    
      	
              1.4.2  

            	
              references
      to (or to any specified provision of) this Agreement or any other document
      shall be construed as references to this Agreement, that provision or that
      document as in force for the time being and as amended in accordance with
      terms thereof, or, as the case may be, with the agreement of the relevant
      parties;

            

    

     

    
      	
              1.4.3  

            	
              references
      to a “regulation”
      include any present or future regulation, rule, directive, requirement,
      request or guideline (whether or not having the force of law) of any
      agency, authority, central bank or government department or any
      self-regulatory or other national or supra-national
    authority;

            

    

     

    
      	
              1.4.4  

            	
              words
      importing the plural shall include the singular and vice
      versa;

            

    

     

    
      	
              1.4.5  

            	
              references
      to a time of day are to Greek time;

            

    

     

    
      	
              1.4.6  

            	
              references
      to a person shall be construed as references to an individual, firm,
      company, corporation, unincorporated body of persons or any Government
      Entity;

            

    

     

    
      	
              1.4.7  

            	
              references
      to a “guarantee”
      include references to an indemnity or other assurance against financial
      loss including, without limitation, an obligation to purchase assets or
      services as a consequence of a default by any other person to pay any
      Indebtedness and “guaranteed” shall be
      construed accordingly; and

            

    

     

    
      	
              1.4.8  

            	
              references
      to any enactment shall be deemed to include references to such enactment
      as re-enacted, amended or extended.

            

    

     

    
      	
              2  

            	
              The
      Commitment and the Loan

            

    

     

    
      	
              2.1  

            	
              Agreement
      to lend

            

    

     

    The
Bank, relying upon each of the representations and warranties in clause 7,
agrees to lend to the Borrower, upon and subject to the terms of this Agreement,
the principal sum of up to Forty seven million Dollars
($47,000,000).

     

    
      	
              2.2  

            	
              Drawdown

            

    

     

    Subject
to the terms and conditions of this Agreement, the Loan shall be advanced in
full in one amount on the Drawdown Date following receipt by the Bank from the
Borrower of a Drawdown Notice not later than 10:00 a.m. one (1) Banking Day
before the proposed Drawdown Date.  A Drawdown Notice shall be
effective on actual receipt by the Bank and, once given, shall, subject as
provided in clause 3.6.1, be irrevocable.

     

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    
      	
              2.3  

            	
              Amount

            

    

     

    The
principal amount specified in the Drawdown Notice for borrowing on the Drawdown
Date shall, subject to the terms and conditions of this Agreement, not exceed
the lower of (a) Forty seven million Dollars ($47,000,000) and (b) the amount in
Dollars which is equal to seventy per cent (70%) of the market value of the Ship
as shown in the valuation obtained pursuant to Schedule 2, Part 2.

     

    
      	
              2.4  

            	
              Availability

            

    

     

    Upon
receipt of a Drawdown Notice complying with the terms of this Agreement the Bank
shall, subject to the provisions of clause 9, on the Drawdown Date make the
Loan available to the Borrower in accordance with
clause 6.2.  The Borrower acknowledges that payment of the Loan
or part thereof to the Seller in accordance with clause 6.2 shall satisfy the
obligation of the Bank to lend the Commitment to the Borrower under this
Agreement.

     

    
      	
              2.5  

            	
              Termination
      of Commitment

            

    

     

    Any
undrawn amount of the Commitment by the Termination Date shall thereupon be
automatically cancelled.

     

    
      	
              2.6  

            	
              Application
      of proceeds

            

    

     

    Without
prejudice to the Borrower's obligations under clause 8.1.3, the Bank shall
have no responsibility for the application of the proceeds of the Loan or any
part thereof by the Borrower.

     

    
      	
              2.7  

            	
              Derivative
      transactions

            

    

     

    
      	
              2.7.1  

            	
              If,
      at any time during the Security Period (as defined in the Ship Security
      Documents), the Borrower wishes to enter into any derivative transaction
      for any purpose whatsoever (including, without limitation, interest rate
      swap transactions so as to hedge all or any part of its exposure under
      this Agreement to interest rate fluctuations), it shall advise the Bank in
      writing.

            

    

     

    
      	
              2.7.2  

            	
              Any
      such derivative transaction shall be concluded with the Bank under the
      Master Swap Agreement provided however that no such derivative transaction
      shall be concluded unless the Bank first agrees to it in
      writing.  If and when any such derivative transaction has been
      concluded, it shall constitute a Designated Transaction, and the Borrower
      shall sign a Confirmation with the
Bank.

            

    

     

    
      	
              3  

            	
              Interest and Interest Periods

            

    

     

    
      	
              3.1  

            	
              Normal
      Interest Rate

            

    

     

    The
Borrower shall pay interest on the Loan in respect of each Interest Period
relating thereto on each Interest Payment Date (or, in the case of Interest
Periods of more than six (6) months, by instalments, the first such instalment
being payable three (3) months from the commencement of the Interest Period and
the subsequent instalments at intervals of three (3) months or, if shorter, the
period from the date of the preceding instalment until the Interest Payment Date
relative to such Interest Period) at the rate per annum determined by the Bank
to be the aggregate of (a) the Margin and (b) LIBOR for such Interest
Period.

     

    
      	
              3.2  

            	
              Selection
      of Interest Periods

            

    

     

    The
Borrower may by notice received by the Bank not later than 10:00 a.m. on the
second Banking Day before the beginning of each Interest Period specify whether
such Interest Period shall have a duration of one (1) month, three (3) months,
six (6) months, nine (9) months or twelve (12) months or such other period
(shorter than twelve (12) months) as the Borrower may select and the Bank may,
in its absolute discretion, agree.

     

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    
      	
              3.3  

            	
              Determination
      of Interest Periods

            

    

     

    Every
Interest Period shall be of the duration specified by the Borrower pursuant to
clause 3.2 but so that:

     

    
      	
              3.3.1  

            	
              the
      initial Interest Period shall commence on the Drawdown Date and each
      subsequent Interest Period shall commence on the last day of the previous
      Interest Period;

            

    

     

    
      	
              3.3.2  

            	
              if
      any Interest Period would otherwise overrun a Repayment Date, then, in the
      case of the last Repayment Date, such Interest Period shall end on such
      Repayment Date, and, in the case of any other Repayment Date or Repayment
      Dates, the Loan shall be divided into parts so that there is one part in
      the amount of the repayment instalment due on each Repayment Date falling
      during that Interest Period and having an Interest Period ending on the
      relevant Repayment Date and another part in the amount of the balance of
      the Loan having an Interest Period ascertained in accordance with
      clause 3.2 and the other provisions of this clause 3.3;
      and

            

    

     

    
      	
              3.3.3  

            	
              if
      the Borrower fails to specify the duration of an Interest Period in
      accordance with the provisions of clause 3.2 and this clause 3.3
      such Interest Period shall have a duration of three (3) months or such
      other period as shall comply with this
  clause 3.3.

            

    

     

    
      	
              3.4  

            	
              Default
      interest

            

    

     

    If the
Borrower fails to pay any sum (including, without limitation, any sum payable
pursuant to this clause 3.4) on its due date for payment under any of the
Security Documents, the Borrower shall pay interest on such sum on demand from
the due date up to the date of actual payment (as well after as before
judgement) at a rate determined by the Bank pursuant to this
clause 3.4.  The period beginning on such due date and ending on
such date of payment shall be divided into successive periods of not more than
six (6) months as selected by the Bank each of which (other than the first,
which shall commence on such due date) shall commence on the last day of the
preceding such period.  The rate of interest applicable to each such
period shall be the aggregate (as determined by the Bank) of (a) two per cent
(2%) per annum, (b) the Margin and (c) LIBOR for such period.  Such
interest shall be due and payable on the last day of each such period as
determined by the Bank and each such day shall, for the purposes of this
Agreement, be treated as an Interest Payment Date, provided that if such unpaid
sum is an amount of principal which became due and payable by reason of a
declaration by the Bank under clause 10.2.2 or a prepayment pursuant to
clauses 4.3, 8.3.1(a) or 12.1, on a date other than an Interest Payment
Date relating thereto, the first such period selected by the Bank shall be of a
duration equal to the period between the due date of such principal sum and such
Interest Payment Date and interest shall be payable on such principal sum during
such period at a rate of two per cent (2%) above the rate applicable thereto
immediately before it shall have become so due and payable.  If, for
the reasons specified in clause 3.6.1, the Bank is unable to determine a
rate in accordance with the foregoing provisions of this clause 3.4,
interest on any sum not paid on its due date for payment shall be calculated at
a rate determined by the Bank to be two per cent (2%) per annum above the
aggregate of the Margin and the cost of funds to the Bank.

     

    
      	
              3.5  

            	
              Notification
      of Interest Periods and interest
rate

            

    

     

    The
Bank shall notify the Borrower promptly of the duration of each Interest Period
and of each rate of interest determined by it under this
clause 3.

     

    
      	
              3.6  

            	
              Market
      disruption; non-availability

            

    

     

    
      	
              3.6.1  

            	
              If and whenever, at any time prior to the commencement of
      any Interest Period, the Bank shall have determined (which determination
      shall, in the absence of manifest error, be
    conclusive):

            

    

     

    
      	 	
              (a)  

            	
              that
      adequate and fair means do not exist for ascertaining LIBOR during such
      Interest Period; or

            

    

     

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (b)  

            	
              that
      deposits in Dollars are not available to the Bank in the London Interbank
      Market in the ordinary course of business in sufficient amounts to fund
      the Loan for such Interest Period,

            

    

     

    
      	
               

            	
              the
      Bank shall forthwith give notice (a “Determination Notice”)
      thereof to the Borrower.  A Determination Notice shall contain
      particulars of the relevant circumstances giving rise to its
      issue.  After the giving of any Determination Notice the undrawn
      amount of the Commitment shall not be borrowed until notice to the
      contrary is given to the Borrower by the
  Bank. 

            

    

     

    
    

    
      	
              3.6.2  

            	
              During
      the period of ten (10) days after any Determination Notice has been given
      by the Bank under clause 3.6.1, the Bank shall certify an alternative
      basis (the “Substitute
      Basis”) for maintaining the Loan.  The Substitute Basis
      may (without limitation) include alternative interest periods, alternative
      currencies or alternative rates of interest but shall include a margin
      above the cost of funds to the Bank equivalent to the
      Margin.  Each Substitute Basis so certified shall be binding
      upon the Borrower and shall take effect in accordance with its terms from
      the date specified in the Determination Notice until such time as the Bank
      notifies the Borrower that none of the circumstances specified in
      clause 3.6.1 continues to exist whereupon the normal interest rate
      fixing provisions of the Agreement shall
apply.

            

    

     

    
      	
              4  

            	
              Repayment
      and prepayment

            

    

     

    
      	
              4.1  

            	
              Repayment

            

    

     

    The
Borrower shall repay the Loan by thirty two (32) instalments, one such
instalment to be repaid on each of the Repayment Dates.  Subject to
the provisions of this Agreement, the amount of each of the first to eighth
instalments (inclusive) shall be Two million two hundred and fifty thousand
Dollars ($2,250,000), the amount of each of the ninth to twelfth instalments
(inclusive) shall be One million five hundred thousand Dollars ($1,500,000), the
amount of each of the thirteenth to the sixteenth instalments (inclusive) shall
be Seven hundred and fifty thousand Dollars ($750,000) and the amount of each of
the seventeenth to thirty first instalments (inclusive) shall be Five hundred
thousand Dollars ($500,000) and the amount of the final instalment shall be
Twelve million five hundred thousand Dollars ($12,500,000) (comprising a
repayment instalment of Five hundred thousand Dollars ($500,000) and a balloon
payment of Twelve million Dollars ($12,000,000) (the “Balloon
Instalment”)).

     

    
      	
              4.2  

            	
              Voluntary
      prepayment

            

    

     

    The
Borrower may prepay the Loan in whole or part (being Two million Dollars
($2,000,000) or any larger sum which is an integral multiple of Two million
Dollars ($2,000,000)) on any Interest Payment Date relating to the part of the
Loan to be repaid without premium or penalty.

     

    
      	
              4.3  

            	
              Prepayment
      on Total Loss

            

    

     

    On the
Ship becoming a Total Loss (or suffering damage or being involved in an incident
which, in the opinion of the Bank, may result in the Ship subsequently being
determined to be a Total Loss), before the Loan is drawn down, the obligation of
the Bank to advance the Loan shall immediately cease and the Commitment shall be
reduced to zero.

     

    On the
date falling one hundred and twenty (120) days after that on which the Ship
became a Total Loss or, if earlier, on the date upon which the insurance
proceeds are, or Requisition Compensation (as defined in the Ship Security
Documents) is, received by the Borrower (or the Bank pursuant to the Security
Documents), the Borrower shall prepay the Loan in full.

     

    For the
purpose of this Agreement, a Total Loss shall be deemed to have
occurred:

     

    
      	
              4.3.1  

            	
              in
      the case of an actual total loss of the Ship, on the actual date and at
      the time the Ship was lost or, if such date is not known, on the date on
      which the Ship was last reported;

            

    

     

    
      	
              4.3.2  

            	
              in
      the case of a constructive total loss of the Ship, upon the date and at
      the time notice of abandonment of the Ship is given to the insurers of the
      Ship for the time being;

            

    

     

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    
      	
              4.3.3  

            	
              in
      the case of a compromised or arranged total loss, on the date upon which a
      binding agreement as to such compromised or arranged total loss has been
      entered into by the insurers of the
Ship;

            

    

     

    
      	
              4.3.4  

            	
              in
      the case of Compulsory Acquisition, on the date upon which the relevant
      requisition of title or other compulsory acquisition occurs;
      and

            

    

     

    
      	
              4.3.5  

            	
              in
      the case of hijacking, theft, condemnation, capture, seizure, arrest,
      detention or confiscation of the Ship (other than where the same amounts
      to Compulsory Acquisition of the Ship) by any Government Entity, or by
      persons purporting to act on behalf of any Government Entity, which
      deprives the Borrower of the use of the Ship for more than sixty (60)
      days, upon the expiry of the period of thirty (30) days after the date
      upon which the relevant hijacking, theft, condemnation, capture, seizure,
      arrest, detention or confiscation
occurred.

            

    

     

    
      	
              4.4  

            	
              Amounts
      payable on prepayment

            

    

     

    
      	
              4.5  

            	
              Any
      prepayment of all or part of the Loan under this Agreement shall be made
      together with (a) accrued interest on the Loan, (b) any
      additional amount payable under clauses 6.6 or 12.2 and (c) all
      other sums payable by the Borrower to the Bank under this Agreement or any
      of the other Security Documents including, without limitation, any accrued
      commitment commission and amounts payable under
      clause 11.

            

    

     

    
      	
              4.6  

            	
              Notice
      of prepayment; reduction of repayment
  instalments

            

    

     

    No
prepayment may be effected under clause 4.2 unless the Borrower shall have
given the Bank at least three (3) Banking Days' notice in writing of its
intention to make such prepayment.  Every notice of prepayment shall
be effective only on actual receipt by the Bank, shall be irrevocable, shall
specify the amount to be prepaid and shall oblige the Borrower to make such
prepayment on the date specified.  No amount prepaid may be reborrowed
and any amount prepaid pursuant to clauses 4.2 or 8.3.1(a) shall be applied
in reducing the repayment instalments under clause 4.1 (including the
Balloon Instalment) in inverse order of their due dates for
payment.  The Borrower may not prepay the Loan or any part thereof
save as expressly provided in this Agreement.

     

    
      	
              4.7  

            	
              Unwinding
      of Designated Transactions

            

    

     

    On or
prior to any repayment or prepayment of all or part of the Loan (including,
without limitation, pursuant to clause 4.3 following a Total Loss, pursuant to
clauses 4.2 or 8.3 or any other provision of this Agreement), the Borrower shall
upon the request of the Bank wholly or partially reverse, offset, unwind,
cancel, close out, net out or otherwise terminate one or more of the continuing
Designated Transactions so that the notional principal amount of the continuing
Designated Transactions thereafter remaining does not and will not in the future
(taking into account the scheduled amortisation) exceed the amount of the Loan
as reducing from time to time thereafter pursuant to clause 4.1.

     

    
      	
              5  

            	
              Fees,
      commitment commission and expenses 

            

    

     

    
      	
              5.1  

            	
              Fees

            

    

     

    The
Borrower shall pay to the Bank:

     

    
      	
              5.1.1  

            	
              on
      the Drawdown Date an arrangement fee of One hundred and twenty thousand
      Dollars ($120,000); and

            

    

     

    
      	
              5.1.2  

            	
              on
      the earlier of (a) the Drawdown Date and (b) the Termination Date,
      commitment commission computed from 23 October 2007 at the rate of zero
      point two five per cent (0.25%) per annum on the daily undrawn amount of
      the Commitment.

            

    

     

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    
      	 	The
      fee referred to in clause 5.1.1 and the commitment commission referred to
      in clause 5.1.2 shall be non-refundable and the commitment commission
      referred to in clause 5.1.2 shall be payable by the Borrower to the Bank
      whether or not any part of the Commitment is ever
  advanced. 

    

     

    
      	
              5.2  

            	
              Expenses

            

    

     

    The
Borrower shall pay to the Bank on a full indemnity basis on demand all expenses
(including legal, printing and out-of-pocket expenses) incurred by the Bank
(whether or not any part of the Commitment is ever advanced):

     

    
      	
              5.2.1  

            	
              in
      connection with the negotiation, preparation, execution and, where
      relevant, registration of the Security Documents and of any amendment or
      extension of or the granting of any waiver or consent under, any of the
      Security Documents; and

            

    

     

    
      	
              5.2.2  

            	
              in
      contemplation of, or otherwise in connection with, the enforcement of, or
      preservation of any rights under, any of the Security Documents or
      otherwise in respect of the moneys owing under any of the Security
      Documents,

            

    

     

    together
with interest at the rate referred to in clause 3.4 from the date on which
such expenses were incurred to the date of payment (as well after as before
judgement).

     

    
      	
              5.3  

            	
              Value
      Added Tax

            

    

     

    All
fees and expenses payable pursuant to this clause 5 shall be paid together
with value added tax or any similar tax (if any) properly chargeable
thereon.

     

    
      	
              5.4  

            	
              Stamp
      and other duties

            

    

     

    The
Borrower shall pay all stamp, documentary, registration or other like duties or
taxes (including any such duties or taxes payable by the Bank) imposed on or in
connection with any of the Underlying Documents, Security Documents or the Loan
and shall indemnify the Bank against any liability arising by reason of any
delay or omission by the Borrower to pay such duties or taxes.

     

    
      	
              6  

            	
              Payments
      and taxes; accounts and
calculations

            

    

     

    
      	
              6.1  

            	
              No
      set-off or counterclaim

            

    

     

    The
Borrower acknowledges that in performing its obligations under this Agreement,
the Bank will be incurring liabilities to third parties in relation to the
funding of amounts to the Borrower, such liabilities matching the liabilities of
the Borrower to the Bank and that it is reasonable for the Bank to be entitled
to receive payments from the Borrower gross on the due date in order that the
Bank is put in a position to perform its matching obligations to the relevant
third parties.  Accordingly, all payments to be made by the Borrower
under any of the Security Documents shall be made in full, without any set-off
or counterclaim whatsoever and, subject as provided in clause 6.6, free and
clear of any deductions or withholdings, in Dollars on the due date to such
account of the Bank at such bank in such place as the Bank may from time to time
specify for this purpose.

     

    
      	
              6.2  

            	
              Payment
      by the Bank

            

    

     

    All
sums to be advanced by the Bank to the Borrower under this Agreement in respect
of the Loan shall be remitted in Dollars on the Drawdown Date to the account
specified in the Drawdown Notice.

     

    
      	
              6.3  

            	
              Non-Banking
      Days

            

    

     

    When
any payment under any of the Security Documents would otherwise be due on a day
which is not a Banking Day, the due date for payment shall be extended to the
next following Banking Day unless such Banking Day falls in the next calendar
month in which case payment shall be made on the immediately preceding Banking
Day.

     

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    
      	
              6.4  

            	
              Calculations

            

    

     

    All
interest and other payments of an annual nature under any of the Security
Documents shall accrue from day to day and be calculated on the basis of actual
days elapsed and a three hundred and sixty (360) day year.

     

    
      	
              6.5  

            	
              Certificates
      conclusive

            

    

     

    Any
certificate or determination of the Bank as to any rate of interest or any other
amount pursuant to and for the purposes of any of the Security Documents shall,
in the absence of manifest error, be conclusive and binding on the
Borrower.

     

    
      	
              6.6  

            	
              Grossing-up
      for Taxes

            

    

     

    
      	
              6.6.1  

            	
              If
      at any time the Borrower is required to make any deduction or withholding
      in respect of Taxes from any payment due under any of the Security
      Documents, the sum due from the Borrower in respect of such payment shall
      be increased to the extent necessary to ensure that, after the making of
      such deduction or withholding, the Bank receives on the due date for such
      payment (and retains, free from any liability in respect of such deduction
      or withholding), a net sum equal to the sum which it would have received
      had no such deduction or withholding been required to be made and the
      Borrower shall indemnify the Bank against any losses or costs incurred by
      it by reason of any failure of the Borrower to make any such deduction or
      withholding or by reason of any increased payment not being made on the
      due date for such payment.  The Borrower shall promptly deliver
      to the Bank any receipts, certificates or other proof evidencing the
      amounts (if any) paid or payable in respect of any deduction or
      withholding as aforesaid.

            

    

     

    
      	
              6.6.2  

            	
              For
      the avoidance of doubt, clause 6.6.1 does not apply in respect of sums due
      from the Borrower to the Bank under or in connection with the Master Swap
      Agreement as to which sums the provisions of section 2(d) (Deduction or
      Withholding for Tax) of the Master Swap Agreement shall
    apply.

            

    

     

    
      	
              6.7  

            	
              Loan
      account

            

    

     

    The
Bank shall maintain, in accordance with its usual practice, an account (which
shall be the “Account Current” referred to in the Mortgage) evidencing the
amounts from time to time lent by, owing to and paid to it under the Security
Documents.  Such account shall, in the absence of manifest error, be
conclusive as to the amount from time to time owing by the Borrower under the
Security Documents.

     

    
      	
              7  

            	
              Representations and warranties

            

    

     

    
      	
              7.1  

            	
              Continuing
      representations and warranties

            

    

     

    The
Borrower represents and warrants to the Bank that:

     

    
      	
              7.1.1  

            	
              Due
      incorporation

            

    

     

    
      	
               

            	
              the
      Borrower and each of the other Security Parties are duly incorporated and
      validly existing in good standing under the laws of the Marshall Islands
      as Marshall Islands corporations and have power to carry on their
      respective businesses as they are now being conducted and to own their
      respective property and other
assets; 

            

    

     

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    
      	
              7.1.2  

            	
              Corporate
      power

            

    

     

    
      
        	
                  

              	
                the
      Borrower has power to execute, deliver and perform its obligations under
      the Underlying Documents and the Borrower's Security Documents and to
      borrow the Commitment and each of the other Security Parties has power to
      execute and deliver and perform its obligations under the Security
      Documents and the Underlying Documents to which it is or is to be a party;
      all necessary corporate, shareholder and other action has been taken to
      authorise the execution, delivery and performance of the same and no
      limitation on the powers of the Borrower to borrow will be exceeded as a
      result of borrowing the Loan; 

              

      

       

    

    
    

     

    
      	
              7.1.3  

            	
              Binding
      obligations

            

    

     

    
      
        	
                 

              	
                the
      Security Documents and the Underlying Documents constitute or will, when
      executed, constitute valid and legally binding obligations of the relevant
      Security Parties enforceable in accordance with their respective
      terms; 

              

      

       

    

    
      	
              7.1.4  

            	
              No
      conflict with other obligations

            

    

     

    
      	
               

            	
              the
      execution and delivery of, the performance of their obligations under, and
      compliance with the provisions of the Underlying Documents and the
      Security Documents by the relevant Security Parties will not
      (i) contravene any existing applicable law, statute, rule or
      regulation or any judgement, decree or permit to which the Borrower or any
      other Security Party is subject, (ii) conflict with, or result in any
      breach of any of the terms of, or constitute a default under, any
      agreement or other instrument to which the Borrower or any other Security
      Party is a party or is subject or by which it or any of its property is
      bound, (iii) contravene or conflict with any provision of the
      constitutional documents of the Borrower or any other Security Party or
      (iv) result in the creation or imposition of or oblige the Borrower or any
      other member of the Group or any other Security Party to create any
      Encumbrance (other than a Permitted Encumbrance) on the undertakings,
      assets, rights or revenues of the Borrower or any other member of the
      Group or any other Security
Party; 

            

    

     

    
      	
              7.1.5  

            	
              No
      litigation

            

    

     

    
      	
               

            	
              no
      litigation, arbitration or administrative proceeding is taking place,
      pending or, to the knowledge of the officers of the Borrower, threatened
      against the Borrower or any other member of the Group or any other
      Security Party which could have a material adverse effect on the business,
      assets or financial condition of the Borrower or any other member of the
      Group or any other Security
Party; 

            

    

     

     

    
      	
              7.1.6  

            	
              No
      filings required

            

    

     

    
      	
               

            	
              save
      for the registration of the Mortgage with the Registry, it is not
      necessary to ensure the legality, validity, enforceability or
      admissibility in evidence of any of the Underlying Documents or any of the
      Security Documents that they or any other instrument be notarised, filed,
      recorded, registered or enrolled in any court, public office or elsewhere
      in any Relevant Jurisdiction or that any stamp, registration or similar
      tax or charge be paid in any Relevant Jurisdiction on or in relation to
      the Underlying Documents or the Security Documents and the Underlying
      Documents and each of the Security Documents is in proper form for its
      enforcement in the courts of each Relevant
    Jurisdiction; 

            

    

     

    
      	
              7.1.7  

            	
              Choice
      of law

            

    

     

    
      	
               

            	
              the
      choice of English law to govern the Underlying Documents and the Security
      Documents (other than the Mortgage and the Account Pledges), the choice of
      Maltese law to govern the Mortgage and the choice of Greek law to govern
      the Account Pledges, and the submissions by the Security Parties to the
      non-exclusive jurisdiction of the English courts or, as the case may be,
      the courts of Piraeus, are valid and
  binding; 

            

    

     

    
      	
              7.1.8  

            	
              No
      immunity

            

    

     

    
      	
               

            	
              neither
      the Borrower nor any other Security Party nor any of their respective
      assets is entitled to immunity on the grounds of sovereignty or otherwise
      from any legal action or proceeding (which shall include, without
      limitation, suit, attachment prior to judgement, execution or other
      enforcement); 

            

    

     

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    
      	
              7.1.9  

            	
              Consents
      obtained

            

    

     

    
      	
               

            	
              every
      consent, authorisation, licence or approval of, or registration with or
      declaration to, governmental or public bodies or authorities or courts
      required by any Security Party to authorise, or required by any Security
      Party in connection with, the execution, delivery, validity,
      enforceability or admissibility in evidence of each of the Underlying
      Documents and each of the Security Documents or the performance by each
      Security Party of its obligations under the Underlying Documents and the
      Security Documents to which it is a party has been obtained or made and is
      in full force and effect and there has been no default in the observance
      of any of the conditions or restrictions (if any) imposed in, or in
      connection with, any of the same;
and 

            

    

     

    
      	
              7.1.10  

            	
              Shareholdings

            

    

     

    
      	
               

            	
              the
      Borrower is a wholly-owned direct Subsidiary of the Corporate Guarantor,
      all of the issued shares in the Manager are legally and ultimately
      beneficially owned by the person or persons disclosed by the Borrower to
      the Bank in the negotiation of this Agreement and no less than 25% of the
      total issued voting share capital of the Corporate Guarantor is ultimately
      beneficially owned by Mr George Economou and/or trusts or foundations of
      which Mr. George Economou is
      a beneficiary. 

            

    

     

    
      	
              7.2  

            	
              Initial
      representations and warranties

            

    

     

    The
Borrower further represents and warrants to the Bank that:

     

    
      	
              7.2.1  

            	
              Pari
      passu

            

    

     

    
      	
               

            	
              the
      obligations of the Borrower under this Agreement are direct, general and
      unconditional obligations of the Borrower and rank at least pari passu
      with all other present and future unsecured and unsubordinated
      Indebtedness of the Borrower except for obligations which are mandatorily
      preferred by law and not by
contract; 

            

    

     

    
      	
              7.2.2  

            	
              No
      default under other Indebtedness

            

    

     

    
      	
               

            	
              neither
      the Borrower nor any other Security Party nor any other member of the
      Group is (nor would with the giving of notice or lapse of time or the
      satisfaction of any other condition or combination thereof be) in breach
      of or in default under any agreement relating to Indebtedness to which it
      is a party or by which it may be
bound; 

            

    

     

    
      	
              7.2.3  

            	
              Information

            

    

     

    
      	
               

            	
              the
      information, exhibits and reports furnished by any Security Party to the
      Bank in connection with the negotiation and preparation of each of the
      Security Documents are true and accurate in all material respects and not
      misleading, do not omit material facts and all reasonable enquiries have
      been made to verify the facts and statements contained therein; there are
      no other facts the omission of which would make any fact or statement
      therein misleading; 

            

    

     

    
      	
              7.2.4  

            	
              No
      withholding Taxes

            

    

     

    
      	
               

            	
              no
      Taxes are imposed by withholding or otherwise on any payment to be made by
      any Security Party under the Underlying Documents or the Security
      Documents or are imposed on or by virtue of the execution or delivery by
      the Security Parties of the Underlying Documents or the Security Documents
      or any other document or instrument to be executed or delivered under any
      of the Security Documents; 

            

    

     

    
      	
              7.2.5  

            	
              No
      Default

            

    

     

    
      	 	no
      Default has occurred and is
continuing; 

    

     

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    
      	
              7.2.6  

            	
              The
      Ship

            

    

     

    
      	 	the
      Ship is and will on the Delivery Date
be: 

    

     

    
      	 	
              (a)  

            	
              in
      the absolute ownership of the Borrower who will on and after the Delivery
      Date be the sole, legal and beneficial owner of the
  Ship;

            

    

     

    
      	 	
              (b)  

            	
              registered
      in the name of the Borrower through the offices of the Registry as a ship
      under the laws and flag of the Flag
State;

            

    

     

    
      	 	
              (c)  

            	
              operationally
      seaworthy and in every way fit for service;
and

            

    

     

    
      	 	
              (d)  

            	
              classed
      with the Classification free of all requirements and recommendations of
      the Classification Society;

            

    

     

    
      	
              7.2.7  

            	
              Ship's
      employment

            

    

     

    
      	
               

            	
              the
      Ship is not and will not, on or before the Delivery Date, be subject to
      any charter or contract or to any agreement to enter into any charter or
      contract which, if entered into after the date of the Ship Security
      Documents would have required the consent of the Bank and, on or before
      the Delivery Date, there will not be any agreement or arrangement whereby
      the Earnings (as defined in the Ship Security Documents) may be shared
      with any other person; 

            

    

     

    
      	
              7.2.8  

            	
              Freedom from
Encumbrances

            

    

     

    
      	 	neither
      the Ship, nor her Earnings, Insurances or Requisition Compensation (each
      as defined in the Ship Security Documents) nor the Accounts nor any other
      properties or rights which are, or are to be, the subject of any of the
      Security Documents nor any part thereof will be, on the Delivery Date,
      subject to any Encumbrance; 

    

     

    
      	
              7.2.9  

            	
              Compliance
      with Environmental Laws and
Approvals

            

    

     

    
      	 	except
      as may already have been disclosed by the Borrower in writing to, and
      acknowledged in writing by, the
Bank: 

    

     

    
      	 	
              (a)  

            	
              the
      Borrower and the other Relevant Parties and, to the best of the Borrower's
      knowledge and belief (having made due enquiry), their respective
      Environmental Affiliates have complied with the provisions of all
      Environmental Laws;

            

    

     

    
      	 	
              (b)  

            	
              the
      Borrower and the other Relevant Parties and, to the best of the Borrower's
      knowledge and belief (having made due enquiry), their respective
      Environmental Affiliates have obtained all Environmental Approvals and are
      in compliance with all such Environmental Approvals;
  and

            

    

     

    
      	 	
              (c)  

            	
              neither
      the Borrower nor any other Relevant Party nor, to the best of the
      Borrower's knowledge and belief (having made due enquiry), any of their
      respective Environmental Affiliates has received notice of any
      Environmental Claim that the Borrower or any other Relevant Party or any
      such Environmental Affiliate is not in compliance with any Environmental
      Law or any Environmental Approval;

            

    

     

    
      	
              7.2.10  

            	
              No
      Environmental Claims

            

    

     

    
      	
               

            	
              except
      as may already have been disclosed by the Borrower in writing to, and
      acknowledged in writing by, the Bank, there is no Environmental Claim
      pending or, to the best of the Borrower's knowledge and belief, threatened
      against the Borrower or the Ship or any other Relevant Party or any other
      Relevant Ship or, to the best of the Borrower's knowledge and belief
      (having made due enquiry), any of their respective Environmental
      Affiliates; 

            

    

     

     

     

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    
      	
              7.2.11  

            	
              No
      potential Environmental Claims

            

    

     

    
      	
               

            	
              except
      as may already have been disclosed by the Borrower in writing to, and
      acknowledged in writing by, the Bank, there has been no emission, spill,
      release or discharge of a Material of Environmental Concern from the Ship
      or any other ship owned by, managed or crewed by or chartered to the
      Borrower nor, (having made due enquiry) to the best of the Borrower's
      knowledge and belief, from any other Relevant Ship owned by, managed or
      crewed by or chartered to any other Relevant Party which could give rise
      to an Environmental Claim; 

            

    

     

    
    

    
      	
              7.2.12  

            	
              ISPS
      Code

            

    

     

    
      	 	with
      effects from the Delivery Date, the Borrower has a valid and current ISSC
      in respect of the Ship and the Ship is in compliance with the ISPS
      Code; 

    

     

    
      	
              7.2.13  

            	
              No
      material adverse change

            

    

     

    
      	
               

            	
              there
      has been no material adverse change in the financial position of the
      Borrower or any Security Party or any other member of the Group or the
      consolidated financial position of the Group from that described by or on
      behalf of the Borrower or any other Security Party to the Bank in the
      negotiation of this Agreement;
and 

            

    

     

    
      	
              7.2.14  

            	
              Copies
      true and complete

            

    

     

    
      	
               

            	
              the
      copies of the Underlying Documents delivered or to be delivered to the
      Bank pursuant to clause 9.1 are, or will when delivered be, true and
      complete copies of such documents; such documents constitute valid and
      binding obligations of the parties thereto enforceable in accordance with
      their respective terms and there will have been no amendments or
      variations thereof or defaults
thereunder. 

            

    

     

    
      	
              7.3  

            	
              Repetition
      of representations and warranties

            

    

     

    
      	
               

            	
              On and as of the Drawdown Date and (except in relation to the
      representations and warranties in clause 7.2) on each Interest
      Payment Date, the Borrower shall (a) be deemed to repeat the
      representations and warranties in clause 7.1 as if made with
      reference to the facts and circumstances existing on such day and (b) be
      deemed to further represent and warrant to the Bank that the then latest
      audited financial statements delivered to the Bank (if any) have been
      prepared in accordance with the Applicable Accounting Principles which
      have been consistently applied and present fairly and accurately the
      financial position of the Borrower and the consolidated financial position
      of the Group, respectively, as at the end of the financial period to which
      the same relate and the results of the operations of the Borrower and the
      consolidated operations of the Group, respectively, for the financial
      period to which the same relate and, as at the end of such financial
      period, neither the Borrower nor the Corporate Guarantor nor any other
      member of the Group had any significant liabilities (contingent or
      otherwise) or any unrealised or anticipated losses which are not disclosed
      by, or reserved against or provided for in, such financial
      statements.

            

    

     

    
      	
              8  

            	
              Undertakings

            

    

     

    
      	
              8.1  

            	
              General

            

    

     

    
      	
               

            	
              The
      Borrower hereby undertakes with the Bank that, from the date of this
      Agreement and so long as any moneys are owing under any of the Security
      Documents and while all or any part of the Commitment remains outstanding,
      it will:

            

    

     

    
      	
              8.1.1  

            	
              Notice
      of Default

            

    

     

    
      	
               

            	
              promptly
      inform the Bank of any occurrence of which it becomes aware which might
      adversely affect the ability of any Security Party to perform its
      obligations under any of the Security Documents and, without limiting the
      generality of the foregoing, will inform the Bank of any Default forthwith
      upon becoming aware thereof and will from time to time, if so requested by
      the Bank, confirm to the Bank in writing that, save as otherwise stated in
      such confirmation, no Default has occurred and is
      continuing; 

            

    

     

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    
      	
              8.1.2  

            	
              Consents
      and licences

            

    

     

    
      	
               

            	
              without
      prejudice to clauses 7.1 and 9, obtain or cause to be obtained,
      maintain in full force and effect and comply in all material respects with
      the conditions and restrictions (if any) imposed in, or in connection
      with, every consent, authorisation, licence or approval of governmental or
      public bodies or authorities or courts and do, or cause to be done, all
      other acts and things which may from time to time be necessary or
      desirable under applicable law for the continued due performance of all
      the obligations of the Security Parties under each of the Security
      Documents; 

            

    

     

    
      	
              8.1.3  

            	
              Use of proceeds

            

    

     

    
      	 	use
      the Loan exclusively for the purpose specified in
      clause 1.1; 

    

     

    
      	
              8.1.4  

            	
              Pari
      passu

            

    

     

    
      	 	ensure
      that its obligations under this Agreement shall, at all times rank at
      least pari passu with all its other present and future unsecured and
      unsubordinated Indebtedness with the exception of any obligations which
      are mandatorily preferred by law and not by
  contract; 

    

     

    
      	
              8.1.5  

            	
              Financial
statements

            

    

     

    
      	
               

            	
              prepare
      or cause to be prepared financial statements of the Borrower and
      consolidated financial statements of the Group in accordance with the
      Applicable Accounting Principles consistently applied in respect of each
      financial year and cause the same to be reported on by their respective
      auditors and prepare or cause to be prepared unaudited financial
      statements of the Borrower and unaudited consolidated financial statements
      of the Group for each financial half-year on the same basis as the annual
      statements and deliver as many copies of the same as the Bank may
      reasonably require as soon as practicable but not later than one hundred
      and eighty (180) days (in the case of the audited financial statements) or
      ninety (90) days (in the case of the unaudited financial statements) after
      the end of the financial period to which they
  relate; 

            

    

     

    
      	
              8.1.6  

            	
              Delivery
      of reports

            

    

     

    
      	
               

            	
              deliver
      to the Bank as many copies as the Bank may reasonably require at the time
      of issue thereof of every report, circular, notice or like document issued
      by the Borrower to its shareholders or creditors
      generally; 

            

    

     

    
    

    
      	
              8.1.7  

            	
              Provision of further
  information

            

    

     

    
      	
               

            	
              provide
      the Bank with such financial and other information concerning the
      Borrower, the other Security Parties, any other member of the Group, the
      Group as a whole and their respective affairs as the Bank may from time to
      time reasonably require, including, without limitation, regarding their
      financial standing, commitments, operations, vessel sales or purchases,
      any new borrowings and all major financial developments in relation to
      each Security Party, any other member of the Group and the Group as a
      whole; 

            

    

     

    
    

    
      	
              8.1.8  

            	
              Know
      your customer information

            

    

     

    
      	
               

            	
              deliver
      to the Bank such documents and evidence as the Bank shall from time to
      time require relating to the verification of identity and knowledge of the
      Bank’s customers and the compliance by the Bank with all necessary “know
      your customer” or similar checks, always on the basis of applicable laws
      and regulations or the Bank's own internal guidelines in each case as such
      laws, regulations or internal guidelines apply from time to
      time; 

            

    

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    
      	
              8.1.9  

            	
              Obligations
      under Security Documents

            

    

     

    
      	 	duly
      and punctually perform each of the obligations expressed to be assumed by
      it under the Security Documents; 

    

     

    
      	
              8.1.10  

            	
              Compliance
      with Code

            

    

     

    
      	
               

            	
              and
      will procure that the Manager or any Operator will, comply with and ensure
      that the Ship and the Manager or any Operator comply with the requirements
      of the Code, including (but not limited to) the maintenance and renewal of
      valid certificates pursuant thereto throughout the Security Period (as
      defined in the Deed of Covenant) and will procure that each member of the
      Group and each vessel thereof complies with the requirements of the
      Code; 

            

    

     

    
    

    
      	
              8.1.11  

            	
              Withdrawal
      of DOC and SMC

            
	 	 
	 	and
      will procure that the Manager or any Operator will, immediately inform the
      Bank if there is any threatened or actual withdrawal of its Operator’s DOC
      or the SMC in respect of the Ship; 

    

     

    
      	
              8.1.12  

            	
              Issuance
      of DOC and SMC

            

    

     

    
      	
               

            	
              and
      will procure that the Manager or any Operator will, promptly inform the
      Bank upon the issue to the Borrower, the Manager or any Operator of a DOC
      and to the Ship of an SMC or the receipt by the Borrower, the Manager or
      any Operator of notification that its application for the same has been
      refused; 

            

    

     

    
      	
              8.1.13  

            	
              ISPS
      Code Compliance

            
	 	 
	 	and
      will procure that the Manager or any Operator
  will: 

    

     

    
      	 	
              (a)  

            	
              maintain
      at all times a valid and current ISSC respect of the
  Ship;

            

    

     

    
      	 	
              (b)  

            	
              immediately
      notify the Bank in writing of any actual or threatened withdrawal,
      suspension, cancellation or modification of the ISSC in respect of the
      Ship; and

            

    

     

    
      	 	
              (c)  

            	
              procure
      that the Ship and any other vessel of the Group will comply at all times
      with the ISPS Code;

            

    

     

    
      	
              8.1.14  

            	
              Charters

            

    

     

    
      	
               

            	
              without
      prejudice to the rights of the Bank under the provisions of the relevant
      Ship Security Documents, advise the Bank promptly of any Charter in
      respect of the Ship and forthwith after its execution (a) deliver a
      certified copy of each such Charter to the Bank, (b) execute a Charter
      Assignment in relation to such Charter, (c) execute a notice of assignment
      (in such form as the Bank may require in its discretion) of such Charter,
      (d) procure that such notice of assignment is served on the relevant
      Charterer and that the relevant Charterer signs an acknowledgement of such
      notice (in such form as the Bank may require in its discretion), (e)
      provide the Bank with any documents or evidence of the type specified in
      schedule 2 relating to the Charter, the Charter Assignment, the notice of
      assignment and its acknowledgment (including, but without limitation the
      valid execution and binding effect thereof) as the Bank may require in its
      sole discretion and (f) pay on the Bank’s demand all legal and other costs
      incurred by the Bank in connection with or in relation to any such Charter
      Assignment, notice of assignment and the acknowledgement thereof;
      and 

            

    

     

    
      	
              8.1.15  

            	
              Minimum
      liquidity

            

    

     

    
      	
               

            	
              maintain
      at all times in accounts held in its name with the Bank (which for the
      purposes of this clause shall include the Accounts but shall exclude any
      other accounts of the Borrower with the Bank which are subject to an
      Encumbrance) a fair share of the Borrower’s
    liquidity. 

            

    

     

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    
      	
              8.2  

            	
              Negative
      undertakings

            

    

     

    The
Borrower undertakes with the Bank that, from the date of this Agreement and so
long as any moneys are owing under the Security Documents, it will not, without
the prior written consent of the Bank:

     

    
      	
              8.2.1  

            	
              Negative
      Pledge

            

    

     

    
      	
               

            	
              permit
      any Encumbrance (other than a Permitted Encumbrance) by the Borrower to
      subsist, arise or be created or extended over all or any part of its
      present or future undertaking, assets, rights or revenues to secure or
      prefer any present or future Indebtedness of any Security Party or any
      other person; 

            

    

     

    
      	
              8.2.2  

            	
              No
      merger

            
	 	 
	 	merge
      or consolidate with any other person or enter into a demerger,
      amalgamation, corporate reconstruction or corporate
      redomicilation; 

    

     

    
      	
              8.2.3  

            	
              Disposals

            

    

     

    
      	 	
              sell, transfer, abandon, lend
      or otherwise dispose of or cease to exercise direct control over any part
      (being either alone or, when aggregated with all other disposals falling
      to be taken into account pursuant to this clause 8.2.3, material in
      the opinion of the Bank in relation to the undertaking, assets, rights and
      revenues of the Borrower taken as a whole) of its present or future
      undertaking, assets, rights or revenues (otherwise than by transfers,
      sales or disposals for full consideration in the ordinary course of
      trading, but which for the avoidance of doubt does not include the Ship)
      whether by one or a series of transactions related or
  not;

            

    

     

    
      	
              8.2.4  

            	
              Other
      business

            

    

     

    
      	 	
              undertake any business other
      than the ownership and operation of the Ship and the chartering of the
      Ship to third parties and will procure that no other Security Party
      undertakes, without the prior written consent of the Bank, any business
      other than that conducted by such Security Party at the date of this
      Agreement;

            

    

     

    
      	
              8.2.5  

            	
              Acquisitions

            

    

     

    
      	 	
              acquire any further assets
      other than the Ship and rights arising under contracts entered into by or
      on behalf of the Borrower in the ordinary course of its business of
      owning, operating and chartering the
Ship;

            

    

     

    
      	
              8.2.6  

            	
              Other
      obligations

            

    

     

    
      	
               

            	
              incur
      any obligations except for obligations arising under the Underlying
      Documents or the Security Documents or contracts entered into in the
      ordinary course of its business of owning, operating and chartering the
      Ship;

            

    

     

    
      	
              8.2.7  

            	
              No
      borrowing

            
	 	 
	 	incur
      any Borrowed Money except for Borrowed Money pursuant to the Security
      Documents; 

    

     

    
      	
              8.2.8  

            	
              Repayment
      of borrowings

            
	 	 
	 	repay the principal of, or pay
      interest on, or any other sum in connection with, any of its Borrowed
      Money except for Borrowed Money pursuant to the Security
      Documents; 

    

     

    
      	
              8.2.9  

            	
              Guarantees

            

    

     

    
      	
               

            	
              issue
      any guarantees or indemnities or otherwise become directly or contingently
      liable for the obligations of any person, firm, or corporation except
      pursuant to the Security Documents (except for guarantees or indemnities
      from time to time required in the ordinary course by any protection and
      indemnity or war risks association with which the Ship is entered,
      guarantees required to procure the release of the Ship from any arrest,
      detention, attachment or levy or guarantees or undertakings required for
      the salvage of the Ship); 

            

    

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    
      	
              8.2.10  

            	
              Loans

            
	 	 
	 	make
      any loans or grant any credit (save for normal trade credit in the
      ordinary course of business) to any person or agree to do
    so; 

    

     

    
      	
              8.2.11  

            	
              Sureties

            

    

     

    
      	
               

            	
              permit
      any of its Indebtedness to be guaranteed or otherwise assured against
      financial loss by any person (save for guarantees or indemnities from time
      to time required in the ordinary course by any protection and indemnity or
      war risks association with which the Ship is entered, guarantees required
      to procure the release of the Ship from any arrest, detention, attachment
      or levy or guarantees or undertakings required for the salvage of the
      Ship);

            

    

     

    
      	
              8.2.12  

            	
              Share
      capital and distribution

            

    

     

    purchase
or otherwise acquire for value any shares of its capital or, following the
occurrence of an Event of Default, distribute any of its present or future
assets, undertakings, rights or revenues to any of its
shareholders;

     

    
      	
              8.2.13  

            	
              Subsidiaries

            

    

     

    form or
acquire any Subsidiaries;

     

    
      	
              8.2.14  

            	
              Shareholdings

            

    

     

    change,
cause or permit any change in (a) the legal and/or ultimate beneficial ownership
of any of the shares in the Borrower or the Manager from that set out in clause
7.1.10 or (b) the ultimate beneficial ownership of the issued voting share
capital of the Corporate Guarantor such that Mr George Economou and/or any
trusts and/or foundations of which
Mr. George Economou is a beneficiary, cease to be the ultimate beneficial owners
of at least 25% of the
total issued voting share capital of the Corporate
Guarantor;

     

    
      	
              8.2.15  

            	
              Change
      of management of the Ship

            

    

     

    appoint
any person to manage the Ship other than the Manager or terminate the Management
Agreement or vary or amend the terms thereof;

     

    
      	
              8.2.16  

            	
              Constitutional
      documents

            

    

     

    permit,
cause or agree to any material amendment or variation of its constitutional
documents;

     

    
      	
              8.2.17  

            	
              Auditors
      and financial year

            

    

     

    remove
or permit the removal of its auditors or appoint new ones or change its
financial year end; or

     

    
      	
              8.2.18  

            	
              Designated
      Transactions

            

    

     

    enter
into any derivative transactions other than Designated
Transactions.

     

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

     

    
      	
              8.3  

            	
              Security
      value maintenance

            

    

     

    
      	
              8.3.1  

            	
              Security
shortfall

            

    

     

    If at
any time the Security Value shall be less than the Security Requirement, the
Bank may give notice to the Borrower requiring that such deficiency be remedied
and then the Borrower shall either:

     

    
      	 	
              (a)  

            	
              prepay within a period of thirty (30) days of the date of
      receipt by the Borrower of the Bank's said notice such sum in Dollars as
      will result in the relevant Security Requirement after such prepayment
      (taking into account any other repayment of the Loan made between the date
      of the notice and the date of such prepayment) being equal to the Security
      Value; or

            

    

     

    
      	 	
              (b)  

            	
              within thirty (30) days of the date of receipt by the
      Borrower of the Bank's said notice constitute to the satisfaction of the
      Bank such further security for the Loan as shall be acceptable to the Bank
      having a value for security purposes (as determined by the Bank in its
      absolute discretion) at the date upon which such further security shall be
      constituted which, when added to the Security Value, shall not be less
      than the relevant Security Requirement as at such
  date.

            

    

     

    The
provision of clauses 4.4 and any relevant provisions of clause 4.5 shall
apply to prepayments made under clause 8.3.1(a).

     

    
      	
              8.3.2  

            	
              Valuation of
Ship

            

    

     

    The
Ship shall, for the purposes of this clause 8.3, be valued as and when the
Bank shall in its absolute discretion require, by an independent firm of
shipbrokers appointed by the Bank in its sole discretion.  Each such
valuation shall be made without, unless required by the Bank, physical
inspection and on the basis of a sale for prompt delivery, for cash at arm’s
length, on normal commercial terms as between a willing buyer and a willing
seller without taking into account the benefit of any charter-party or other
engagement concerning the Ship.  Such valuation shall constitute the
value of the Ship for the purposes of this clause 8.3.

     

    The
value of the Ship determined in accordance with the provisions of this
clause 8.3 shall be binding upon the parties hereto until such time as any
such further valuations shall be obtained.

     

    
      	
              8.3.3  

            	
              Information

            

    

     

    The
Borrower undertakes to the Bank to supply to the Bank and to any such
shipbrokers such information concerning the Ship and its condition as such
shipbrokers may reasonably require for the purpose of making any such
valuations.

     

    
      	
              8.3.4  

            	
              Costs

            

    

     

    All
costs in connection with the Bank obtaining any valuation of the Ship referred
to in clause 8.3.2 or in schedule 2, Part 2, and any valuation either of any
additional security for the purposes of ascertaining the Security Value at any
time or necessitated by the Borrower electing to constitute additional security
pursuant to clause 8.3.1(b) shall be borne by the Borrower.

     

    
      	
              8.3.5  

            	
              Valuation
      of additional security

            

    

     

    For the
purpose of this clause 8.3, the market value of any additional security
provided or to be provided to the Bank shall be determined by the Bank in its
absolute discretion without any necessity for the Bank assigning any reason
thereto.

     

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

     

    
      	
              8.3.6  

            	
              Documents
      and evidence

            

    

     

    In
connection with any additional security provided in accordance with this
clause 8.3, the Bank shall be entitled to receive such evidence and
documents of the kind referred to in schedule 2 as may in the Bank's
opinion be appropriate and such favourable legal opinions as the Bank shall in
its absolute discretion require.

     

    
      	
              9  

            	
              Conditions

            

    

     

    
      	
              9.1  

            	
              Documents
      and evidence

            

    

     

     The
obligation of the Bank to make the Commitment available shall be subject to the
condition
that:

     

    
      	
              9.1.1  

            	
              the
      Bank, or its duly authorised representative, shall have received, not
      later than three (3) Banking Days before the day on which the Drawdown
      Notice for the Loan is given, the documents and evidence specified in Part
      1 of schedule 2 in form and substance satisfactory to the Bank;
      and

            

    

     

    
      	
              9.1.2  

            	
              the
      Bank, or its duly authorised representative, shall have received, on or
      prior to the Drawdown Date, the documents and evidence specified in Part 2
      of schedule 2 in form and substance satisfactory to the
      Bank.

            

    

     

    
      	
              9.2  

            	
              General
      conditions precedent

            

    

     

    The
obligation of the Bank to advance the Loan shall be subject to the further
condition that, at the
time of the giving of the Drawdown Notice, and at the time of the making of the
Loan:

     

    
      	
              9.2.1

            	
              
                the
      representations and warranties contained in clauses 7.1, 7.2 and
      7.3(b) are true and correct on and as of each such time as if each was
      made with respect to the facts and circumstances existing at such time;
      and

              

            

    

     

     

    
      	
              9.2.2  

            	
              no
      Default shall have occurred and be continuing or would result from the
      making of the Loan.

            

    

     

    
      	
              9.3  

            	
              Waiver
      of conditions precedent

            

    

     

    The
conditions specified in this clause 9 are inserted solely for the benefit
of the Bank and may be
waived by the Bank in whole or in part and with or without
conditions.

     

    
      	
              9.4  

            	
              Further
      conditions precedent

            

    

     

    
      	
               

            	
              Not
      later than five (5) Banking Days prior to the Drawdown Date and not later
      than five (5) Banking Days prior to each Interest Payment Date, the Bank
      may request and the Borrower shall, not later than two (2) Banking
      Days prior to such date, deliver to the Bank on such request further
      favourable certificates and/or opinions as to any or all of the matters
      which are the subject of clauses 7, 8, 9 and 10 of this
      Agreement.

            

    

     

    
      	
              10  

            	
              Events of Default

            

    

     

    
      	
              10.1  

            	
              Events

            

    

     

     There
shall be an Event of Default if:

     

    
      	
              10.1.1  

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

            

    

     

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    
      	
              10.1.2  

            	
              Master
      Swap Agreement: (a) an Event of Default or Potential Event of
      Default (in each case as defined in the Master Swap Agreement) has
      occurred and is continuing with the Borrower as the Defaulting Party (as
      defined in the Master Swap Agreement) under the Master Swap Agreement or
      (b) an Early Termination Date has occurred or been or become capable of
      being effectively designated under the Master Swap Agreement by the Bank
      or (c) the Master Swap Agreement is terminated, cancelled, suspended,
      rescinded or revoked or otherwise ceases to remain in full force and
      effect for any reason; or

            

    

     

    
      	
              10.1.3  

            	
              Breach of insurance
      obligations: the Borrower or the Manager fails to obtain and/or
      maintain the Insurances (as defined in, and in accordance with the
      requirements of, the Ship Security Documents) or if any insurer in respect
      of such Insurances cancels the Insurances or disclaims liability by
      reason, in either case, of mis-statement in any proposal for the
      Insurances or for any other failure or default on the part of the Borrower
      or any other person or the Borrower commits any breach of or omits to
      observe any of the obligations or undertakings expressed to be assumed by
      it under clauses 8.2, 8.3 or 8.4 or the Corporate Guarantor commits any
      breach or fails to observe any of the obligations or undertakings
      expressed to be assumed by it under clauses 5.2 or 5.3 of the Corporate
      Guarantee; or

            

    

     

    
      	
              10.1.4  

            	
              Breach of
      other obligations: the Borrower or any other Security Party commits
      any breach of or omits to observe any of its obligations or undertakings
      expressed to be assumed by it under any of the Security Documents (other
      than those referred to in clauses 10.1.1, 10.1.2 and 10.1.3
      above) and, in respect of any such breach or omission which in the opinion
      of the Bank is capable of remedy, such action as the Bank may require
      shall not have been taken within fourteen (14) days of the Bank notifying
      the relevant Security Party of such default and of such required action;
      or

            

    

     

    
      	
              10.1.5  

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

            

    

     

    
      	
              10.1.6  

            	
              Cross-default: any
      Indebtedness of the Borrower or any other Security Party or any other
      member of the Group is not paid when due or any Indebtedness of any
      Security Party or other member of the Group becomes (whether by
      declaration or automatically in accordance with the relevant agreement or
      instrument constituting the same) due and payable prior to the date when
      it would otherwise have become due (unless as a result of the exercise by
      the relevant Security Party or other member of the Group of a voluntary
      right of prepayment), or any creditor of any Security Party or other
      member of the Group becomes entitled to declare any such Indebtedness due
      and payable or any facility or commitment available to any Security Party
      or other member of the Group relating to Indebtedness is withdrawn,
      suspended or cancelled by reason of any default (however described) of the
      person concerned unless the relevant Security Party or other member of the
      Group shall have satisfied the Bank that such withdrawal, suspension or
      cancellation will not affect or prejudice in any way the ability of the
      relevant Security Party or the relevant member of the Group to pay its
      debts as they fall due and fund its commitments, or any guarantee given by
      any Security Party or other member of the Group in respect of Indebtedness
      is not honoured when due and called upon and, in the case of the Corporate
      Guarantor only, the amount or aggregate amount at any one time of all
      Indebtedness of the Corporate Guarantor in relation to which any of the
      foregoing events shall have occurred is equal to or greater than One
      million Dollars ($1,000,000) or its equivalent in the currency in which
      same is denominated and payable; or

            

    

     

    
      	
              10.1.7  

            	
              Legal process: any
      judgement or order made against the Borrower or any other Security Party
      or other member of the Group is not stayed or complied with within fifteen
      (15) days or a creditor attaches or takes possession of, or a distress,
      execution, sequestration or other process is levied or enforced upon or
      sued out against, any of the undertakings, assets, rights or revenues of
      the Borrower or any other Security Party or other member of the Group and
      is not discharged within fifteen (15) days;
or

            

    

     

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

     

    
      	
              10.1.8  

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

            

    

     

    
      	
              10.1.9  

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

            

    

     

    
      	
              10.1.10  

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

            

    

     

    
      	
              10.1.11  

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

            

    

     

    
      	
              10.1.12  

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

            

    

     

    
      	
              10.1.13  

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

            

    

     

    
      	
              10.1.14  

            	
              Analogous proceedings:
      there occurs, in relation to the Borrower or any other Security Party or
      other member of the Group, in any country or territory in which any of
      them carries on business or to the jurisdiction of whose courts any part
      of their assets is subject, any event which, in the opinion of the Bank,
      appears in that country or territory to correspond with, or have an effect
      equivalent or similar to, any of those mentioned in clauses 10.1.7 to
      10.1.13 (inclusive) or the Borrower or any other Security Party or other
      member of the Group otherwise becomes subject, in any such country or
      territory, to the operation of any law relating to insolvency, bankruptcy
      or liquidation; or

            

    

     

    
      	
              10.1.15  

            	
              Cessation of business:
      the Borrower or any other Security Party or other member of the Group
      suspends or ceases or threatens to suspend or cease to carry on its
      business; or

            

    

     

    
      	
              10.1.16  

            	
              Invalidity: any of the
      Security Documents shall at any time and for any reason become invalid or
      unenforceable or otherwise cease to remain in full force and effect, or if
      the validity or enforceability of any of the Security Documents shall at
      any time and for any reason be contested by the Borrower or any other
      Security Party which is a party thereto, or if the Borrower or any such
      Security Party shall deny that it has any, or any further, liability
      thereunder or shall otherwise repudiate any of the Security Documents or
      do or cause or permit to be done any act or thing evidencing an intention
      to repudiate any of the Security Documents;
or

            

    

     

    
      	
              10.1.17  

            	
              Seizure: all or a
      material part of the undertakings, assets, rights or revenues of, or
      shares or other ownership interests in, the Borrower or any other Security
      Party or any other member of the Group are seized, nationalised,
      expropriated or compulsorily acquired by or under the authority of any
      Government Entity; or

            

    

     

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

     

    
      	
              10.1.18  

            	
              Unlawfulness: it becomes
      impossible or unlawful at any time for the Borrower or any other Security
      Party, to fulfil any of the covenants and obligations expressed to be
      assumed by it in any of the Security Documents or for the Bank to exercise
      the rights or any of them vested in it under any of the Security Documents
      or otherwise; or

            

    

     

    
      	
              10.1.19  

            	
              Repudiation: the
      Borrower or any other Security Party repudiates any of the Security
      Documents or does or causes or permits to be done any act or thing
      evidencing an intention to repudiate any of the Security Documents;
      or

            

    

     

    
      	
              10.1.20  

            	
              Encumbrances
      enforceable: any Encumbrance in respect of any of the property (or
      part thereof) which is the subject of any of the Security Documents
      becomes enforceable; or

            

    

     

    
      	
              10.1.21  

            	
              De-listing etc.: the
      shares of the Corporate Guarantor are de-listed or suspended from, or
      cease to trade (whether permanently or temporarily) on, NASDAQ unless they
      are in the meantime listed and trading on any other stock exchange of the
      U.S.A.; or

            

    

     

    
      	
              10.1.22  

            	
              Material adverse change:
      there occurs, in the opinion of the Bank, a material adverse change in the
      financial condition of the Borrower or any other Security Party or any
      other member of the Group or the consolidated financial condition of the
      Group by reference to the financial position of the Borrower or any other
      Security Party or any other member of the Group or, as the case may be,
      the consolidated financial position of the Group, respectively, as
      described by or on behalf of the Borrower or any other Security Party to
      the Bank in the negotiation of this Agreement;
  or

            

    

     

    
      	
              10.1.23  

            	
              Flag State: the Flag
      State becomes involved in hostilities or civil war or there is a seizure
      of civil power in the Flag State by unconstitutional means if, in any such
      case such event could in the opinion of the Bank reasonably be expected to
      have a material adverse effect on the security constituted by any of the
      Security Documents; or

            

    

     

    
      	
              10.1.24  

            	
              Environmental Claim: the
      Borrower and/or any other Relevant Party and/or any of their respective
      Environmental Affiliates fails to comply with any Environmental Law or any
      Environmental Approval or the Ship or any other Relevant Ship is involved
      in any incident which gives rise or which may give rise to an
      Environmental Claim, if in any such case, such non compliance or incident
      or the consequences thereof could (in the opinion of the Bank) reasonably
      be expected to have a material adverse effect on the business, assets,
      operations, property or financial condition of the Borrower or any other
      Security Party or on the security created by any of the Security
      Documents; or

            

    

     

    
      	
              10.1.25  

            	
              Insurance requirements:
      the Borrower or any other person fails or omits to comply with any
      requirements of the protection and indemnity association or other insurer
      with which the Ship is entered for insurance or insured against protection
      and indemnity risks (including oil pollution risks) to the effect that any
      cover (including, without limitation, liability for Environmental Claims
      arising in jurisdictions where the Ship operates or trades) is or may be
      liable to cancellation, qualification or exclusion at any time;
      or

            

    

     

    
      	
              10.1.26  

            	
              Arrest: the Ship is
      arrested, confiscated, seized, taken in execution, impounded, forfeited,
      detained in the exercise or purported exercise of any possessory lien or
      other claim or otherwise taken from the possession of the Borrower and the
      Borrower shall fail to procure the release of the Ship within a period of
      three (3) days; or

            

    

     

    
      	
              10.1.27  

            	
              Registration: the
      registration of the Ship under the laws and flag of the Flag State is
      cancelled or terminated; or

            

    

     

    
      	
              10.1.28  

            	
              Shareholdings: there is
      any change in (a) the legal and/or ultimate beneficial ownership of any of
      the shares in the Borrower and/or the Manager from that existing on the
      date of this Agreement as specified in clause 7.1.10 or (b) the ultimate
      beneficial ownership of the issued voting share capital of the Corporate
      Guarantor such that Mr George Economou and/or trusts and/or
      foundations of which Mr.
      George Economou is a beneficiary, cease to be the ultimate beneficial
      owners of at least 25% of the total issued voting share
      capital of the Corporate Guarantor;
or

            

    

     

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

     

    
      	
              10.1.29  

            	
              Accounts: any moneys are
      withdrawn from the Accounts other than in accordance with clause 14;
      or

            

    

     

    
      	
              10.1.30  

            	
              Material events: any
      other event occurs or circumstance arises which, in the opinion of the
      Bank, is likely materially and adversely to affect either (i) the ability
      of the Borrower or any other Security Party to perform all or any of their
      respective obligations under or otherwise to comply with the terms of any
      of the Security Documents or (ii) the security created by any of the
      Security Documents.

            

    

     

    
      	
              10.2  

            	
              Acceleration

            

    

     

    
      	 	
              The Bank may,
      without prejudice to any other rights of the Bank, at any time after the
      happening of an Event of Default by notice to the Borrower declare
      that:

            

    

     

    
      	
              10.2.1  

            	
              the
      obligation of the Bank to make the Commitment available shall be
      terminated, whereupon the Commitment shall be reduced to zero forthwith;
      and/or

            

    

     

    
      	
              10.2.2  

            	
              the Loan and all interest and commitment commission
      accrued and all other sums payable under the Security Documents have
      become due and payable, whereupon the same shall, immediately or in
      accordance with the terms of such notice, become due and
      payable.

            

    

     

    
      	
              10.3  

            	
              Demand
      basis

            

    

     

    
    

     

    
      	 	 	
              If, pursuant to
      clause 10.2.2, the Bank declares the Loan to be due and payable on demand, the
      Bank may by written notice to the Borrower (a) call for repayment of the
      Loan on such date as may be specified whereupon the Loan shall become due
      and payable on the date so specified together with all interest and
      commitment commission accrued and all other sums payable under this
      Agreement or (b) withdraw such declaration with effect from the date
      specified in such notice.

            

    

     

    
      	
              11  

            	
              Indemnities

            

    

     

    
      	
              11.1  

            	
              Miscellaneous
      indemnities

            
	 	 
	 	The
      Borrower shall on demand indemnify the Bank, without prejudice to any of
      the Bank's other rights under any of the Security Documents against any
      loss (including loss of Margin) or expense which the Bank shall certify as
      sustained or incurred by it as a consequence
  of: 

    

     

    
      	
              11.1.1  

            	
              any
      default in payment by the Borrower of any sum under any of the Security
      Documents when due; or

            

    

     

    
      	
              11.1.2  

            	
              the
      occurrence of any other Event of Default;
or

            

    

     

    
      	
              11.1.3  

            	
              any
      prepayment of the Loan or part thereof being made under clauses 4.3,
      8.3.1(a) or 12.1, or any other repayment or prepayment of the Loan or part
      thereof being made otherwise than on an Interest Payment Date relating to
      the part of the Loan prepaid or repaid;
or

            

    

     

    
      	
              11.1.4  

            	
              the
      Loan not being made for any reason (excluding any default by the Bank)
      after the Drawdown Notice for the Loan has been
  given,

            

    

     

    
      	
               

            	
              including,
      in any such case, but not limited to, any loss or expense sustained or
      incurred in maintaining or funding the Loan or any part thereof or in
      liquidating or re-employing deposits from third parties acquired to effect
      or maintain the Loan or any part
thereof.

            

    

     

    
      	
              11.2  

            	
              Currency
      indemnity

            

    

     

    
      	
               

            	
              If
      any sum due from the Borrower under any of the Security Documents or any
      order or  judgement given or made in relation thereto has to be
      converted from the currency (the “first
      currency”) in which the same is payable under the relevant Security
      Document or under such order or judgement into another currency (the
      “second
      currency”) for the purpose of (a) making or filing a claim or
      proof against the Borrower, (b) obtaining an order or judgement in
      any court or other tribunal or (c) enforcing any order or judgement
      given or made in relation to any of the Security Documents, the Borrower
      shall indemnify and hold harmless the Bank from and against any loss
      suffered as a result of any difference between (i) the rate of
      exchange used for such purpose to convert the sum in question from the
      first currency into the second currency and (ii) the rate or rates of
      exchange at which the Bank may in the ordinary course of business purchase
      the first currency with the second currency upon receipt of a sum paid to
      it in satisfaction, in whole or in part, of any such order, judgement,
      claim or proof.  Any amount due from the Borrower under this
      clause 11.2 shall
      be due as a separate debt and shall not be affected by judgement being
      obtained for any other sums due under or in respect of any of the Security
      Documents and the term “rate
      of exchange” includes any premium and costs of exchange payable in
      connection with the purchase of the first currency with the second
      currency. 

            

    

     

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

    

     

    
      	
              11.3  

            	
              Environmental
      indemnity

            

    

     

    The
Borrower shall indemnify the Bank on demand and hold the Bank harmless from and
against all costs, expenses, payments, charges, losses, demands, liabilities,
actions, proceedings (whether civil or criminal), penalties, fines, damages,
judgements, orders, sanctions or other outgoings of whatever nature which may be
suffered, incurred or paid by, or made or asserted against the Bank at any time,
whether before or after the repayment in full of principal and interest under
this Agreement, relating to, or arising directly or indirectly in any manner or
for any cause or reason whatsoever out of an Environmental Claim made or
asserted against the Bank if such Environmental Claim would not have been, or
been capable of being, made or asserted against the Bank if it had not entered
into any of the Security Documents and/or exercised any of its rights, powers
and discretions thereby conferred and/or performed any of its obligations
thereunder and/or been involved in any of the transactions contemplated by the
Security Documents.

     

    
      	
              11.4  

            	
              Central
      Bank or European Central Bank reserve requirements
    indemnity

            

    

     

    The
Borrower shall on demand promptly indemnify the Bank against any cost incurred
or loss suffered by it as a result of its complying with the minimum reserve
requirements of the European Central Bank and/or with respect to maintaining
required reserves with the relevant national Central Bank to the extent that
such compliance relates to the Commitment or the Loan or deposits obtained by it
to fund or maintain the whole or part of the Loan and such cost or loss is not
recoverable by the Bank under clause 12.2.

     

    
      	
              12  

            	
              Unlawfulness
      and increased costs

            

    

     

    
      	
              12.1  

            	
              Unlawfulness

            

    

     

    If it
is or becomes contrary to any law or regulation for the Bank to advance the Loan
or to maintain the Commitment or fund the Loan, the Bank shall promptly give
notice to the Borrower whereupon (a) the Commitment shall be reduced to
zero and (b) the Borrower shall be obliged to prepay the Loan either
(i) forthwith or (ii) on a future specified date not being earlier
than the latest date permitted by the relevant law or regulation together with
interest accrued to the date of prepayment and all other sums payable by the
Borrower under this Agreement and/or the Master Swap Agreement.

     

    
      	
              12.2  

            	
              Increased
      costs

            

    

     

    If the
result of any change in, or in the interpretation or application of, or the
introduction of, any law or any regulation, request or requirement, including
(without limitation) those relating to Taxation, capital adequacy, liquidity,
reserve assets, cash ratio deposits and special deposits, is to:

     

    
      	
              12.2.1  

            	
              subject
      the Bank to Taxes or change the basis of Taxation of the Bank with respect
      to any payment under any of the Security Documents (other than Taxes or
      Taxation on the overall net income, profits or gains of the Bank imposed
      in the jurisdiction in which its principal or lending office under this
      Agreement is located); and/or

            

    

     

     

    
      
        
        

      

      
        29

        
          

        

      

      
        
        

      

    

     

    
      	
              12.2.2  

            	
              increase
      the cost to, or impose an additional cost on, the Bank in making or
      keeping the Commitment available or maintaining or funding all or part of
      the Loan; and/or

            

    

     

    
      	
              12.2.3  

            	
              reduce
      the amount payable or the effective return to the Bank under any of the
      Security Documents; and/or

            

    

     

    
      	
              12.2.4  

            	
              reduce
      the Bank's rate of return on its overall capital by reason of a change in
      the manner in which it is required to allocate capital resources to the
      Bank's obligations under any of the Security Documents;
    and/or

            

    

     

    
      	
              12.2.5  

            	
              require
      the Bank to make a payment or forego a return on or calculated by
      reference to any amount received or receivable by the Bank under any of
      the Security Documents,

            
	 	 
	 	then
      and in each such case: 

    

     

    
      	 	
              (a)  

            	
              the
      Bank shall notify the Borrower in writing of such event promptly upon its
      becoming aware of the same; and

            

    

     

    
      	 	
              (b)  

            	
              the
      Borrower shall on demand pay to the Bank the amount which the Bank
      specifies (in a certificate setting forth the basis of the computation of
      such amount but not including any matters which the Bank regards as
      confidential) is required to compensate the Bank for such liability to
      Taxes, cost, reduction, payment, foregone return or
  loss.

            

    

     

    For the
purposes of this clause 12.2, the Bank may in good faith allocate or spread
costs and/or losses among its assets and liabilities (or any class thereof) on
such basis as it considers appropriate.

     

    
      	
              12.3  

            	
              Exception

            

    

     

    Nothing
in clause 12.2 shall entitle the Bank to receive any amount in respect of
compensation for any such liability to Taxes, increased or additional cost,
reduction, payment, foregone return or loss to the extent that the same is the
subject of an additional payment under clause 6.6.

     

    
      	
              13  

            	
              Security
      and set-off

            

    

     

    
      	
              13.1  

            	
              Application
      of moneys

            

    

     

    All
moneys received by the Bank under or pursuant to any of the Security Documents
and expressed to be applicable in accordance with the provisions of this
clause 13.1 shall be applied by the Bank in the following
manner:

     

    
      	
              13.1.1  

            	
              first
      in or toward payment of all unpaid fees, commissions and expenses which
      may be owing to the Bank under any of the Security
    Documents;

            

    

     

    
      	
              13.1.2  

            	
              secondly
      in or towards payment of any arrears of interest owing in respect of the
      Loan or any part thereof;

            

    

     

    
      	
              13.1.3  

            	
              thirdly
      in or towards repayment of the Loan (whether the same is due and payable
      or not);

            

    

     

    
      	
              13.1.4  

            	
              fourthly
      in or towards payment of any sums owing under the Master Swap
      Agreement;

            

    

     

    
      	
              13.1.5  

            	
              fifthly
      in or towards payment to the Bank for any loss suffered by reason of any
      such payment in respect of principal not being effected on an Interest
      Payment Date relating to the part of the Loan
  repaid;

            

    

     

    
      	
              13.1.6  

            	
              sixthly
      in or towards payment to the Bank of any other sums owing to it under any
      of the Security Documents; and

            

    

     

     

    
      
        
        

      

      
        30

        
          

        

      

      
        
        

      

    

     

    
      	
              13.1.7  

            	
              seventhly
      the surplus (if any) shall be paid to the Borrower or to whomsoever else
      may be entitled to receive such
surplus.

            

    

     

    
      	
              13.2  

            	
              Set-off

            

    

     

    
      	
              13.2.1  

            	
              The
      Borrower authorises the Bank (without prejudice to any of the Bank's
      rights at law, in equity or otherwise), at any time and without notice to
      the Borrower, to apply any credit balance to which the Borrower is then
      entitled standing upon any account of the Borrower with any branch of the
      Bank in or towards satisfaction of any sum due and payable from the
      Borrower to the Bank under any of the Security Documents.  For
      this purpose, the Bank is authorised to purchase with the moneys standing
      to the credit of such account such other currencies as may be necessary to
      effect such application.

            

    

     

    
      	
              13.2.2  

            	
              Without
      prejudice to its rights hereunder, the Bank may at the same time as, or at
      any time after, any Default occurs under this Agreement, set-off any
      amount due now or in the future from the Borrower to the Bank under this
      Agreement against any amount due from the Bank to the Borrower under the
      Master Swap Agreement and apply the second amount in discharging the first
      amount. The effect of any set-off under this sub-clause 13.2.2 shall be
      effective to extinguish or, as the case may require, reduce the
      liabilities of the Bank under the Master Swap
  Agreement.

            

    

     

    
      	
              13.2.3  

            	
              The
      Bank shall not be obliged to exercise any right given to it by this
      clause 13.2.  The Bank shall notify the Borrower forthwith
      upon the exercise or purported exercise of any right of set-off giving
      full details in relation thereto.

            

    

     

    
      	
              13.2.4  

            	
              Nothing
      in this clause 13.2 shall be effective to create a charge or other
      Encumbrance.

            

    

     

    
      	
              13.3  

            	
              Further
      assurance

            

    

     

    The
Borrower undertakes that the Security Documents shall both at the date of
execution and delivery thereof and so long as any moneys are owing under any of
the Security Documents be valid and binding obligations of the respective
parties thereto and rights of the Bank enforceable in accordance with their
respective terms and that it will, at its expense, execute, sign, perfect and
do, and will procure the execution, signing, perfecting and doing by each of the
other Security Parties of, any and every such further assurance, document, act
or thing as in the reasonable opinion of the Bank may be necessary or desirable
for perfecting the security contemplated or constituted by the Security
Documents.

     

    
      	
              13.4  

            	
              Conflicts

            

    

     

    In the
event of any conflict between this Agreement and any of the other Borrower's
Security Documents, the provisions of this Agreement shall prevail.

     

    
      	
              14  

            	
              Accounts

            

    

     

    
      	
              14.1  

            	
              General

            

    

     

    The
Borrower undertakes that it will:

     

    
      	
              14.1.1  

            	
              on
      or before the Drawdown Date, open each of the Accounts;
  and

            

    

     

    
      	
              14.1.2  

            	
              procure
      that all moneys payable to the Borrower in respect of the Earnings and any
      moneys payable to the Borrower pursuant to the Master Swap Agreement
      shall, unless and until the Bank directs to the contrary pursuant to
      clause 2.1.1 of the Deed of Covenant, be paid to the Earnings
      Account.

            

    

     

    
      	
              14.2  

            	
              Account
      terms

            

    

     

    Amounts
standing to the credit of the Accounts shall (unless otherwise agreed between
the Bank and the Borrower), bear interest at the rates from time to time offered
by the Bank to its prime customers for Dollar deposits in comparable amounts for
comparable periods.  Interest shall accrue on the Accounts from day to
day and be calculated on the basis of actual days elapsed and a three hundred
and sixty (360) day year and shall be credited to the Accounts at such times as
the Bank and the Borrower shall agree.

     

     

    
      
        
        

      

      
        31

        
          

        

      

      
        
        

      

    

     

    
      	
              14.3  

            	
              Earnings
      Account: withdrawals

            

    

     

    Unless
the Bank otherwise agrees in writing, the Borrower shall not be entitled to
withdraw any moneys from the Earnings Account at any time from the date of this
Agreement and so long as any moneys are owing under the Security Documents save
that, unless and until a Default shall occur and the Bank shall direct to the
contrary, the Borrower may withdraw moneys from the Earnings Account for the
following purposes:

     

    
      	
              14.3.1  

            	
              to
      transfer any Retention Amounts to the Retention
  Account;

            

    

     

    
      	
              14.3.2  

            	
              to
      pay any amount to the Bank in or towards payments of any instalments of
      interest or principal or any other amounts then payable pursuant to the
      Security Documents;

            

    

     

    
      	
              14.3.3  

            	
              to
      pay the proper and reasonable operating expenses of the
    Ship;

            

    

     

    
      	
              14.3.4  

            	
              to
      pay the proper and reasonable expenses of administering the affairs of the
      Borrower; and

            

    

     

    
      	
              14.3.5  

            	
              to
      make any payment of dividends declared in accordance with clause
      8.2.12.

            

    

     

    
      	
              14.4  

            	
              Retention
      Account: credits and withdrawals

            

    

     

    
      	
              14.4.1  

            	
              The
      Borrower hereby undertakes with the Bank that it will, from the date of
      this Agreement and so long as any moneys are owing under the Security
      Documents, on each Retention Date pay to the Bank for credit to the
      Retention Account, the Retention Amount for such Retention Date provided
      however that, to the extent that there are moneys standing to the credit
      of the Earnings Account, such moneys shall, up to an amount equal to the
      Retention Amount, be transferred to the Retention Account on that
      Retention Date (and the Borrower hereby irrevocably and unconditionally
      instructs and authorises the Bank to effect each such transfer) and to
      that extent the Borrower’s obligations to make the payments referred to in
      this clause 14.4.1 shall have been fulfilled upon such transfer being
      effected.

            

    

     

    
      	
              14.4.2  

            	
              Unless
      and until there shall occur an Event of Default (whereupon the provisions
      of clause 14.5 shall apply), all Retention Amounts credited to the
      Retention Account together with interest from time to time accruing or at
      any time accrued thereon shall be applied by the Bank (and the Borrower
      hereby irrevocably and unconditionally instructs and authorises the Bank
      so to apply the same) upon each Repayment Date, and on each day that
      interest is payable pursuant to clause 3.1, in or towards payment to
      the Bank of the instalment then falling due for repayment or (as the case
      may be) the amount of interest then due.  Each such application
      by the Bank shall constitute a payment in or towards satisfaction of the
      Borrower’s corresponding payment obligations under this Agreement but
      shall be strictly without prejudice to the obligations of the Borrower to
      make any such payment to the extent that the aforesaid application by the
      Bank is insufficient to meet the
same.

            

    

     

    
      	
              14.4.3  

            	
              Unless
      the Bank otherwise agrees in writing and subject to clause 14.3.2,
      the Borrower shall not be entitled to withdraw any moneys from the
      Retention Account at any time from the date of this Agreement and so long
      as any moneys are owing under the Security
  Documents.

            

    

     

    
      	
              14.5  

            	
              Application
      of Accounts

            

    

     

    At any
time after the occurrence of an Event of Default, the Bank may, without notice
to the Borrower, apply all moneys then standing to the credit of the Accounts
(together with interest from time to time accruing or accrued thereon) in or
towards satisfaction of any sums due to the Bank under the Security Documents in
the manner specified in clause 13.1.

     

     

    
      
        
        

      

      
        32

        
          

        

      

      
        
        

      

    

     

    
      	
              14.6  

            	
              Pledging
      of accounts

            

    

     

    The
Accounts and all amounts from time to time standing to the credit thereof shall
be subject to the security constituted and the rights conferred by the Account
Pledges.

     

    
      	
              15  

            	
              Assignment,
      transfer and lending office

            

    

     

    
      	
              15.1  

            	
              Benefit
      and burden

            

    

     

    This
Agreement shall be binding upon, and shall enure for the benefit of, the Bank
and the Borrower and their respective successors in title.

     

    
      	
              15.2  

            	
              No
      assignment by Borrower

            

    

     

    The
Borrower may not assign or transfer any of its rights or obligations under this
Agreement.

     

    
      	
              15.3  

            	
              Assignment
      by Bank

            

    

     

    The
Bank may assign all or any part of its rights under this Agreement or under any
of the other Security Documents to any other bank or financial institution (an
“Assignee”) with the
prior consent of the Borrower (such consent not to be unreasonably withheld and
the request for which shall be promptly responded to) except if the Assignee is
a Related Company of the Bank in which case no such prior consent is required,
the Borrower consenting to any such assignment by its execution of this
Agreement.

     

    
      	
              15.4  

            	
              Transfer

            

    

     

    The
Bank may transfer all or any part of its rights, benefits and/or obligations
under this Agreement and/or any of the other Security Documents to any one or
more banks or other financial institutions (a “Transferee”):

     

    
      	
              15.4.1  

            	
              with
      the prior written consent of the Borrower (such consent not to be
      unreasonably withheld and the request for which shall be promptly
      responded to), unless the Transferee shall be a Related Company of the
      Bank (in which case no such consent shall be required, the Borrower
      consenting to any such transfer by its execution of this Agreement);
      and

            

    

     

    
      	
              15.4.2  

            	
              if
      the Transferee, by delivery of such undertaking as the Bank may approve,
      becomes bound by the terms of this Agreement and agrees to perform all or,
      as the case may be, part of the Bank’s obligations under this
      Agreement.

            

    

     

    
      	
              15.5  

            	
              Documenting
      assignments and transfers

            

    

     

    If the
Bank assigns all or any part of its rights or transfers all or any part of its
rights, benefits and/or obligations as provided in clause 15.3 or clause
15.4, the Borrower undertakes, immediately on being requested to do so by the
Bank and at the cost of the Bank, to enter into, and procure that the other
Security Parties shall enter into, such documents as may be necessary or
desirable to transfer to the Assignee or Transferee all or the relevant part of
the Bank's interest in the Security Documents and all relevant references in
this Agreement to the Bank shall thereafter be construed as a reference to the
Bank and/or its Assignee or Transferee (as the case may be) to the extent of
their respective interests.

     

    
      	
              15.6  

            	
              Lending
      office

            

    

     

    The
Bank shall lend through its office at the address specified in the definition of
“Bank” in clause 1.2 or
through any other office of the Bank selected from time to time by it through
which the Bank wishes to lend for the purposes of this Agreement.  If
the office through which the Bank is lending is changed pursuant to this
clause 15.6, the Bank shall notify the Borrower promptly of such
change.

     

     

    
      
        
        

      

      
        33

        
          

        

      

      
        
        

      

    

     

    
      	
              15.7  

            	
              Disclosure
      of information

            

    

     

    The
Bank may disclose to a prospective assignee, transferee or to any other person
who may propose entering into contractual relations with the Bank in relation to
this Agreement such information about the Borrower as the Bank shall consider
appropriate.

     

    
      	
              16  

            	
              Notices
      and other matters

            

    

     

    
      	
              16.1  

            	
              Notices

            

    

     

    Every
notice, request, demand or other communication under this Agreement or (unless
otherwise provided therein) under any of the other Security Documents
shall:

     

    
      	
              16.1.1  

            	
              be
      in writing delivered personally or by first-class prepaid letter (airmail
      if available) or facsimile transmission or other means of
      telecommunication in permanent written
form;

            

    

     

    
      	
              16.1.2  

            	
              be
      deemed to have been received, subject as otherwise provided in the
      relevant Security Document, in the case of a letter, when delivered
      personally or three (3) days after it has been put in the post and, in the
      case of a facsimile transmission or other means of telecommunication in
      permanent written form, at the time of despatch (provided that if the date
      of despatch is not a business day in the country of the addressee or if
      the time of despatch is after the close of business in the country of the
      addressee it shall be deemed to have been received at the opening of
      business on the next such business day);
and

            

    

     

    
      	
              16.1.3  

            	
              be
      sent:

            

    

     

    
      	 	
              (a)  

            	
              if
      to the Borrower at:

            

    

     

    c/o
DryShips Inc. (Athens office)

    Omega
Building

    80
Kifissias Avenue

    151 25
Maroussi

    Greece

     

    Fax
no:    +30 210 8090 275

    Attention: Mr
Aristidis Ioannidis

     

    
      	 	
              (b)  

            	
              if
      to the Bank at:

            

    

     

    EFG
Eurobank Ergasias S.A.

    83 Akti
Miaouli & Flessa Street

    185 38
Piraeus

    Greece

     

    Fax
No:    +30 210 458 7877

    Attention: The
Shipping Manager

     

     

     

    
      	 	or to
      such other address and/or numbers as is notified by one party to the other
      party under this Agreement. 

    

     

    
      	
              16.2  

            	
              No
      implied waivers, remedies
cumulative

            

    

     

    No
failure or delay on the part of the Bank to exercise any power, right or remedy
under any of the Security Documents shall operate as a waiver thereof, nor shall
any single or partial exercise by the Bank of any power, right or remedy
preclude any other or further exercise thereof or the exercise of any other
power, right or remedy.  The remedies provided in the Security
Documents are cumulative and are not exclusive of any remedies provided by
law.

     

     

    
      
        
        

      

      
        34

        
          

        

      

      
        
        

      

    

     

    
      	
              16.3  

            	
              English
      language

            

    

     

    All
certificates, instruments and other documents to be delivered under or supplied
in connection with any of the Security Documents shall be in the English
language or shall be accompanied by a certified English translation upon which
the Bank shall be entitled to rely.

     

    
      	
              17  

            	
              Governing law and jurisdiction

            

    

     

    
      	
              17.1  

            	
              Law

            

    

     

    This
Agreement is governed by, and shall be construed in accordance with, English
law.

     

    
      	
              17.2  

            	
              Submission
      to jurisdiction

            

    

     

    The
Borrower agrees, for the benefit of the Bank, that any legal action or
proceedings arising out of or in connection with this Agreement against the
Borrower or any of its assets may be brought in the English
courts.  The Borrower irrevocably and unconditionally submits to the
jurisdiction of such courts and irrevocably designates, appoints and empowers
Ince & Co at present of International House, 1 St. Katharine’s Way, London
E1W 1AY, England to receive for it and on its behalf, service of process issued
out of the English courts in any such legal action or
proceedings.  The submission to such jurisdiction shall not (and shall
not be construed so as to) limit the right of the Bank to take proceedings
against the Borrower in the courts of any other competent jurisdiction nor shall
the taking of proceedings in any one or more jurisdictions preclude the taking
of proceedings in any other jurisdiction, whether concurrently or
not.  The parties further agree that only the Courts of England and
not those of any other State shall have jurisdiction to determine any claim
which the Borrower may have against the Bank arising out of or in connection
with this Agreement.

     

    
      	
              17.3  

            	
              Contracts
      (Rights of Third Parties) Act 1999

            

    

     

    No term
of this Agreement is enforceable under the Contracts (Rights of Third Parties)
Act 1999 by a person who is not a party to this Agreement.

     

    IN WITNESS whereof the
parties to this Agreement have caused this Agreement to be duly executed on the
date first above written.

     

    

    
      
        
           

        

        
          35

          
            

          

        

        
           

        

      

    

    

    Schedule 1

     

    Form
of Drawdown Notice

     

    (referred
to in clause 2.2)

     

    

     

    
      	
              To:

            	
              EFG
      Eurobank Ergasias S.A.

            

    

    83 Akti
Miaouli & Flessa Street

    185 38
Piraeus

    Greece

     

    [·] 200[·]

     

    U.S.$47,000,000
Loan

    Loan
Agreement dated [·]
2007 (the “Loan Agreement”)

     

    We
refer to the above Loan Agreement and hereby give you notice that we wish to
draw down the Loan, namely $[47,000,000] on [·] 200[·] and select a first
Interest Period in respect thereof of [·] months.  The
funds should be credited as follows: [insert details]

     

    We
confirm that:

     

    
      	
              (a)  

            	
              no
      event or circumstance has occurred and is continuing which constitutes a
      Default;

            

    

     

    
      	
              (b)  

            	
              the
      representations and warranties contained in clauses 7.1, 7.2 and
      7.3(b) of the Loan Agreement are true and correct at the date hereof as if
      made with respect to the facts and circumstances existing at such
      date;

            

    

     

    
      	
              (c)  

            	
              the
      borrowing to be effected by the drawdown of the Loan will be within our
      corporate powers, has been validly authorised by appropriate corporate
      action and will not cause any limit on our borrowings (whether imposed by
      statute, regulation, agreement or otherwise) to be exceeded;
      and

            

    

     

    
      	
              (d)  

            	
              there
      has been no material adverse change in our financial position or in that
      of any Security Party or any other member of the Group nor in the
      consolidated financial position of the Group from that described by us or
      any other Security Party to the Bank in the negotiation of the Loan
      Agreement.

            

    

     

    Words
and expressions defined in the Loan Agreement shall have the same meanings where
used herein.

     

    

     

    

     

    

     

    ...............................................................

    For and
on behalf of

    IASON
OWNING COMPANY LIMITED

    

    
      
        
           

        

        
          36

          
            

          

        

        
           

        

      

    

    

    Schedule 2

     

     Documents
and evidence required as conditions precedent to the

     

    Loan
being made

     

    (referred
to in clause 9.1)

     

    Part
1

     

    
      	
              1  

            	
              Constitutional
      documents

            

    

     

    Copies,
certified by an officer or a legal advisor of each Security Party as true,
complete and up to date copies of all documents which contain or establish or
relate to the constitution of that Security Party;

     

    
      	
              2  

            	
              Corporate
      authorisations

            

    

     

    copies
of resolutions of the directors and certificates of resolutions of the
stockholders of each Security Party approving such of the Underlying Documents
and the Security Documents to which such Security Party is, or is to be, a party
and authorising the signature, delivery and performance of such Security Party's
obligations thereunder, certified (in a certificate dated no earlier than
fifteen (15) Banking Days prior to the date of this Agreement) by an officer or
a legal advisor of such Security Party as:

     

    
      	
              2.1  

            	
              being
      true and correct;

            

    

     

    
      	
              2.2  

            	
              being
      duly passed at meetings of the directors of such Security Party and of the
      stockholders of such Security Party each duly convened and
      held;

            

    

     

    
      	
              2.3  

            	
              not
      having been amended, modified or revoked;
and

            

    

     

    
      	
              2.4  

            	
              being
      in full force and effect,

            

    

     

    together
with originals or certified copies of any powers of attorney issued by any
Security Party pursuant to such resolutions;

     

    
      	
              3  

            	
              Specimen
      signatures

            

    

     

    copies
of the signatures of the persons who have been authorised on behalf of each
Security Party to sign such of the Underlying Documents and the Security
Documents to which such Security Party is, or is to be, party and to give
notices and communications, including notices of drawing, under or in connection
with the Security Documents, certified (in a certificate dated no earlier than
five (5) Banking Days prior to the date of this Agreement) by an officer or a
legal advisor of such Security Party as being the true signatures of such
persons;

     

    
      	
              4  

            	
              Certificate
      of incumbency

            

    

     

    a list
of directors and officers of each Security Party specifying the names and
positions of such persons, certified (in a certificate dated no earlier than
five (5) Banking Days prior to the date of this Agreement) by an officer or a
legal advisor of such Security Party to be true, complete and up to
date;

     

    
      	
              5  

            	
              Borrower's
      consents and approvals

            

    

     

    a
certificate (dated no earlier than five (5) Banking Days prior to the date of
this Agreement) from an officer of the Borrower that no consents,
authorisations, licences or approvals are necessary for the Borrower to
authorise or are required by the Borrower in connection with the borrowing by
the Borrower of the Loan pursuant to this Agreement or the other Borrower's
Security Documents;

     

     

    
      
        
        

      

      
        37

        
          

        

      

      
        
        

      

    

     

    
      	
              6  

            	
              Due
      diligence

            

    

     

    evidence
that all information required in relation to any Security Party in order for the
Bank to complete its “know your customer” and other due diligence formalities in
connection with this Agreement and the other Security Documents has been
provided and is satisfactory in all respects to the Bank;

     

    
      	
              7  

            	
              Other
      consents and approvals

            

    

     

    a
certificate (dated no earlier than five (5) Banking Days prior to the date of
this Agreement) from an officer of each Security Party (other than the Borrower)
that no consents, authorisations, licences or approvals are necessary for such
Security Party to guarantee and/or grant security for the borrowing by the
Borrower of the Commitment pursuant to this Agreement and execute, deliver and
perform the Security Documents insofar as such Security Party is a party
thereto;

     

    
      	
              8  

            	
              Security
      Documents

            

    

     

    the
Master Swap Agreement, the Account Pledges, the Corporate Guarantee and the
Master Agreement Security Deed each duly executed;

     

    
      	
              9  

            	
              Certified
      Underlying Documents

            

    

     

    a copy, certified (in a
certificate dated no earlier than fifteen (15) Banking Days prior to the date of
this Agreement) as a true and complete copy by an officer or a legal advisor of
the Borrower of the Contract and the Management
Agreement;

     

    
      	
              10  

            	
              Borrower’s
      process agent

            

    

     

    
      	 	a
      letter from the Borrower’s agent for receipt of service of proceedings
      referred to in clause 17.2 accepting its appointment under the said
      clause and under each of the other Security Documents in which it is
      or is to be appointed as the Borrower’s
    agent; 

    

     

    
      	
              11  

            	
              Security
      Parties’ process agent

            

    

     

    
      	 	a
      letter from each Security Party’s agent for receipt of service of
      proceedings accepting its appointment under each of the Security Documents
      in which it is or is to be appointed as such Security Party’s
      agent; 

    

     

    
      	
              12  

            	
              Accounts

            

    

     

    evidence
that each of the Accounts have been opened, together with duly completed mandate
forms in respect thereof; and

     

    
      	
              13  

            	
              Further
      matters or opinions

            

    

     

    any
such other matter or further opinion as may be required by the
Bank.

     

    

    
      
        
           

        

        
          38

          
            

          

        

        
           

        

      

    

    

    

     

    Part
2

     

    
      	
              14  

            	
              Drawdown
      notice

            

    

     

    The
Drawdown Notice duly executed;

     

    
      	
              15  

            	
              Ship
      conditions

            

    

     

      
Evidence that the Ship:

     

    
      	
              15.1  

            	
              Registration
      and Encumbrances

            

    

     

    is
registered in the name of the Borrower through the Registry under the laws and
flag of the Flag State and that the Ship and its Earnings, Insurances and
Requisition Compensation (each such term as defined in the Deed of Covenant) are
free of Encumbrances;

     

    
      	
              15.2  

            	
              Classification

            

    

     

    maintains
the Classification free of all requirements and recommendations of the
Classification Society; and

     

    
      	
              15.3  

            	
              Insurance

            

    

     

    is
insured in accordance with the provisions of the Ship Security Documents and all
requirements of the Ship Security Documents in respect of such insurances have
been complied with (including without limitation, confirmation from the
protection and indemnity association or other insurer with which the Ship is, or
is to be, entered for insurance or insured against protection and indemnity
risks (including oil pollution risks) that any necessary declarations required
by the association or insurer for the removal of any oil pollution exclusion
have been made and that any such exclusion does not apply to the
Ship);

     

    
      	
              16  

            	
              Ship
      Security Documents

            

    

     

    the
Ship Security Documents duly executed;

     

    
      	
              17  

            	
              Title
      and deletion

            

    

     

    evidence
that the transfer of title to the Ship from the Seller to the
Borrower has been duly recorded at the Registry free of Encumbrances and that
the prior registration of the Ship (if any) in the name of the Seller has been
cancelled;

     

    
      	
              18  

            	
              Mortgage
      registration

            

    

     

    evidence
that the Mortgage over the Ship has been registered against the Ship through the
Registry under the laws and flag of the Flag State;

     

    
      	
              19  

            	
              Notices
      of assignment

            

    

     

    copies
of duly executed notices of assignment required by the terms of the Ship
Security Documents and in the forms prescribed by the Ship Security
Documents;

     

    
      	
              20  

            	
              Valuation

            

    

     

    a
valuation of the Ship made in accordance with clause 8.3.2 at the Borrower’s
cost and dated not more than 10 days prior to the Drawdown Date, evidencing the
market value of the Ship;

     

     

    
      
        
        

      

      
        39

        
          

        

      

      
        
        

      

    

     

    
      	
              21  

            	
              Fees

            

    

     

    evidence
that any fees and commission due under clause 5 have been paid in
full;

     

    
      	
              22  

            	
              Marshall
      Islands opinion

            

    

     

    an
opinion of Poles, Tublin, Stratakis, Gonzalez & Weichert, LLP special legal
advisers on matters of Marshall Islands law, to the Bank;

     

    
      	
              23  

            	
              Maltese
      opinion

            

    

     

    an
opinion of Fenech & Fenech, special legal advisers on matters of Maltese law
to the Bank;

     

    
      	
              24  

            	
              Security
      Parties’ process agent

            

    

     

    a
letter from each Security Party’s agent for receipt of service of proceedings
accepting its appointment under each of the Security Documents in which it is or
is to be appointed as such Security Party’s agent;

     

    
      	
              25  

            	
              Bill
      of sale and delivery documents

            

    

     

    a copy,
certified as a true and complete copy by an officer or a legal advisor of the
Borrower, of a duly executed and notarised/legalised bill of sale in respect of
the Ship evidencing the full Contract Price and the other delivery documents
duly executed and exchanged pursuant to the Contract;

     

    
      	
              26  

            	
              Readiness
      and payment of Contract Price

            

    

     

    evidence
that the Ship is in all respects ready for Delivery and that the Contract Price
has been paid in full;

     

    
      	
              27  

            	
              Insurance
      opinion

            

    

     

    an
opinion (at the expense of the Borrower) of insurance consultants to the Bank on
the insurances effected or to be effected in respect of the Ship upon and
following the Drawdown Date;

     

    
      	
              28  

            	
              SMC/DOC

            

    

     

    a copy,
certified (in a certificate dated no earlier than five (5) Banking Days prior to
the date of this Agreement) as a true and complete copy by an officer or a legal
advisor of the Borrower of the DOC issued to the Operator and the SMC for the
Ship (or an application for the issuance thereof shortly after
Delivery);

     

    
      	
              29  

            	
              ISPS
      Code compliance

            

    

     

    
      	
              29.1  

            	
              evidence
      satisfactory to the Bank that the Ship is subject to a ship security plan
      which complies with the ISPS Code;
and

            

    

     

    
      	
              29.2  

            	
              a
      copy certified (in a certificate dated no earlier than five (5) Banking
      Days prior to the Drawdown Date) as a true and complete copy by an officer
      or a legal advisor of the Borrower of the ISSC for the Ship (or an
      application for the issuance thereof shortly after Delivery) and the
      continuous synopsis record required by the ISPS Code in respect of the
      Ship; and

            

    

     

    
      	
              30  

            	
              Further
      matters or opinions

            

    

     

    any
such other matter or further opinion as may be required by the
Bank.

    

    
      
        
           

        

        
          40

          
            

          

        

        
           

        

      

    

    

    

     

    Schedule 3

     

    Form
of Corporate Guarantee

     

    

    
      
        
           

        

        
          41

          
            

          

        

        
           

        

      

    

    

    

    Schedule 4

     

    Form
of Mortgage

     

    

    
      
        
           

        

        
          42

          
            

          

        

        
           

        

      

    

    

    

    Schedule 5

     

    Form
of Deed of Covenant

     

    

    
      
        
           

        

        
          43

          
            

          

        

        
           

        

      

    

    

    

    Schedule 6

     

    Form
of Manager’s Undertaking

     

    

    
      
        
           

        

        
          44

          
            

          

        

        
           

        

      

    

    

    

    Schedule 7

     

    Form
of Master Swap Agreement

     

    

    
      
        
           

        

        
          45

          
            

          

        

        
           

        

      

    

    

    

    Schedule 8

     

    Form
of Master Agreement Security Deed

     

    

    
      
        
           

        

        
          46

          
            

          

        

        
           

        

      

    

    

    

    
      	
              SIGNED by

              for
      and on behalf of

              IASON
      OWNING COMPANY LIMITED

               

            	
              )

              )

              )

               

            	
               

              ......................................

              Attorney-in-Fact

            
	 
      	 
      	 
      
	
               

              SIGNED by

              and
      by

              for
      and on behalf of

              EFG
      EUROBANK ERGASIAS S.A.

               

            	
               

              )

              )

              )

              )

              )

               

            	
               

              ......................................

              Authorised
      signatory

               

              ......................................

              Authorised
      signatory

            

    

    

    

    

    

     

    

    
      
        
           

        

        
          
            47

            SK 23113 0002
867877d867882_ex4-12.htm

     

    EXHIBIT 4.12

    
      	
              Private &
    Confidential

            
	 
      	 
      	 
      
	
              LOAN AGREEMENT

              for
      a Loan of up to US$101,150,000

              to

              TEAM-UP
      OWNING COMPANY LIMITED

              and

              ORPHEUS
      OWNING COMPANY LIMITED

              provided
      by

              THE
      BANKS AND FINANCIAL INSTITUTIONS SET OUT IN SCHEDULE 1

               

               

              Arranger,
      Agent, Security Agent

              and
      Account Bank

              DNB
      NOR BANK ASA

               

              Swap
      Provider

              DNB
      NOR BANK ASA

               

               

               

               

               

            
	
              

            

    

    
 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Contents

    
 

    
      
        	
                Clause

              	 
      	
                Page

              
	 
      	 
      	 
      
	
                1

              	
                Purpose
      and definitions

              	
                1

              
	
                2

              	
                The
      Total Commitment and the Advances

              	
                13

              
	
                3

              	
                Interest
      and Interest Periods

              	
                15

              
	
                4

              	
                Repayment
      and prepayment

              	
                17

              
	
                5

              	
                Fees
      and expenses

              	
                19

              
	
                6

              	
                Payments
      and taxes; accounts and calculations

              	
                20

              
	
                7

              	
                Representations
      and warranties

              	
                22

              
	
                8

              	
                Undertakings

              	
                27

              
	
                9

              	
                Conditions

              	
                32

              
	
                10

              	
                Events
      of Default

              	
                33

              
	
                11

              	
                Indemnities

              	
                37

              
	
                12

              	
                Unlawfulness
      and increased costs

              	
                38

              
	
                13

              	
                Security,
      set-off and pro-rata payments

              	
                40

              
	
                14

              	
                Operating
      Accounts

              	
                42

              
	
                15

              	
                Assignment,
      transfer and lending office

              	
                43

              
	
                16

              	
                Arranger,
      Agent and Security Agent

              	
                45

              
	
                17

              	
                Notices
      and other matters

              	
                54

              
	
                18

              	
                Governing
      law and jurisdiction

              	
                57

              

      

      

      
        	
                Schedule 1
      The Banks and their Commitments

              	
                58

              
	
                Schedule 2
      Form of Drawdown Notice

              	
                59

              
	
                Schedule 3
      Documents and evidence required as conditions precedent to the Loan being
      made

              	
                60

              
	
                Schedule 4
      Form of Transfer Certificate

              	
                66

              
	
                Schedule 5
      Form of Trust Deed

              	
                70

              
	
                Schedule 6
      Mandatory Cost formula

              	
                71

              
	
                Schedule 7
      Form of Mortgage

              	
                73

              
	
                Schedule 8
      Form of Deed of Covenant

              	
                74

              
	
                Schedule 9
      Form of Corporate Guarantee

              	
                75

              
	
                Schedule 10
      Form of Manager’s Undertakings

              	
                76

              
	
                Schedule 11
      Form of Master Swap Agreement

              	
                77

              
	
                Schedule 12
      Form of Swap Assignment

              	
                78

              
	
                Schedule 13
      Form of Operating Account Assignment

              	
                79

              

      

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    THIS
AGREEMENT is dated
        December 2007 and made BETWEEN:

     

    
      	
              (1)

            	
              TEAM-UP
      OWNING COMPANY LIMITED and
      ORPHEUS OWNING COMPANY LIMITED as
      joint and several
Borrowers;

            

    

     

    
      	
              (2)

            	
              DNB
      NOR BANK ASA as Arranger, Agent, Security Agent and Account
      Bank;

            

    

     

    
      	
              (3)

            	
              DNB
      NOR BANK ASA as Swap Provider;
  and

            

    

     

    
      	
              (4)

            	
              THE
      BANKS AND FINANCIAL INSTITUTIONS whose names are set out in
      schedule 1 as Banks.

            

    

     

    IT
IS AGREED as follows:

     

    
      	
              
                1

              

            	
              
                Purpose
      and definitions

              

            	
               

            

    

     

    
      	
              1.1

            	
              Purpose

            

    

     

    This
Agreement sets out the terms and conditions upon and subject to which the Banks
agree, according to their several obligations, to make available to the
Borrowers, jointly and severally, in two (2) Advances, a loan of up to One
hundred and one million one hundred and fifty thousand Dollars ($101,150,000)
for the purpose of assisting the Borrowers to finance part of the acquisition
cost of the Ships.

     

    
      	
              1.2

            	
              Definitions

            

    

     

    In this
Agreement, unless the context otherwise requires:

     

    “Account Bank” means DnB NOR
Bank ASA, a company incorporated in Norway with its registered office at
Stranden 21, P.O. Box 1171 Sentrum N-0107 Oslo, Norway, acting for the purposes
of this Agreement through its branch at 20 St. Dunstan’s Hill, London EC3R 8HY,
England (or of such other address as may last have been notified to the other
parties to this Agreement pursuant to clause 17.1.3) or such other person as may
be appointed as Account Bank by the Agent for the purposes of this Agreement and
includes its successors in title;

     

    “Agent” means DnB NOR Bank ASA,
a company incorporated in Norway with its registered office at Stranden 21, P.O.
Box 1171 Sentrum N-0107 Oslo, Norway, acting for the purposes of this Agreement
through its branch at 20 St. Dunstan’s Hill, London EC3R 8HY, England (or of
such other address as may last have been notified to the other parties to this
Agreement pursuant to clause 17.1.3) or such other person as may be appointed as
agent by the Banks and the Swap Provider pursuant to clause 16.13 and
includes its successors in title;

     

    “Advance” means each borrowing
of a proportion of the Total Commitment by the Borrowers or (as the context may
require) the principal amount of such borrowing and means:

     

    
      	
               
      

            	
              (a)

            	
              in
      relation to
      Saldanha, the Saldanha Advance;
and

            

    

     

    
      	
               
      

            	
              (b)

            	
              in
      relation to Avoca, the Avoca
      Advance,

            

    

     

    and
“Advances” means either
or both of them;

     

    “Applicable Accounting
Principles” means the most recent and up-to-date US GAAP at any relevant
time;

     

    “Approved Shipbrokers” means,
together, H. Clarkson and Company Ltd of London, England, Arrow Research Ltd. of
London, England, Astrup Fearnley A/S of Oslo, Norway, R.S. Platou Shipbrokers of
Oslo, Norway and any other independent firm of shipbrokers nominated by the
Borrowers and approved by the Agent in its absolute discretion and “Approved Shipbroker” means any of
them;

     

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

    
 

     

    “Arranger” means DnB NOR Bank
ASA, a company incorporated in Norway with its registered office at Stranden 21,
P.O. Box 1171 Sentrum, N-0107 Oslo, Norway acting for the purposes of this
Agreement through its branch at 20 St. Dunstan’s Hill, London EC3R 8HY, England
(or of such other address as may last have been notified to the other parties to
this Agreement pursuant to clause 17.1.3) and includes its successors in
title;

     

    “Available Commitment” means,
in relation to a Bank, the amount of its Commitment less the amount of its
Contribution;

     

    “Avoca”
means the motor vessel Nord
Mercury to be purchased by the relevant Seller and registered under the
laws and flag of Panama with IMO Number 9310446 and to be registered on its
Delivery Date under the name and in the ownership of the Avoca Borrower through
the relevant Registry and under the laws and flag of the relevant Flag State
with the name Avoca;

     

    “Avoca Advance” means an
Advance of up to Forty eight million six hundred and fifty thousand Dollars
($48,650,000) made or (as the context may require) to be made available to the
Borrowers for the purpose of financing part of the acquisition cost of Avoca by the Avoca Borrower
pursuant to the Avoca Contract;

     

    “Avoca Borrower” means Orpheus
Owning Company Limited of Trust Company Complex, Ajeltake Road, Ajeltake Island,
Majuro, Marshall Islands, MH96960 and includes its successors in
title;

     

    “Avoca Contract” means the
memorandum of agreement dated 26 July 2007 made between the relevant Seller, the
Manager and the Corporate Guarantor, as novated in favour of the Avoca Borrower
pursuant to an Addendum No. 1 thereto dated 26 July 2007 and as may be further
amended and supplemented from time to time, relating to the sale by the relevant
Seller and the purchase by the Avoca Borrower, of Avoca;

     

    “Avoca Contract Price” means
the purchase price payable by the Avoca Borrower to the relevant Seller for
Avoca under the Avoca
Contract, being Sixty nine million five hundred thousand Dollars ($69,500,000)
or such other sum as is determined under the terms of the Avoca Contract to be
the purchase price of Avoca
thereunder;

     

    “Avoca Deed of Covenant” means
the deed of covenant collateral to the Avoca Mortgage executed or (as the
context may require) to be executed by the Avoca Borrower in favour of the
Security Agent in the form set out in schedule 8;

     

    “Avoca Management Agreement”
means the agreement dated as of 10 January 2008 made between the Avoca Borrower,
the Corporate Guarantor and the Manager or any other agreement previously
approved in writing by the Agent between the Avoca Borrower and the Manager,
providing (inter alia)
for the Manager to manage Avoca;

     

    “Avoca Manager’s Undertaking”
means the undertaking and assignment in respect of Avoca executed or (as the
context may require) to be executed by the Manager in favour of the Security
Agent in the form set out in schedule 10;

     

    “Avoca Mortgage” means the
first priority statutory Maltese mortgage of Avoca executed or (as the
context may require) to be executed by the Avoca Borrower in favour of the
Security Agent in the form set out in schedule 7;

     

    “Avoca Operating Account” means
an interest bearing Dollar account of the Avoca Borrower opened or (as the
context may require) to be opened with the Account Bank and includes any
sub-accounts thereof and any other account designated in writing by the Agent to
be an Avoca Operating Account for the purposes of this Agreement;

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    
 

     

    “Avoca Operating Account
Assignment” means a first priority assignment executed or (as the context
may require) to be executed by the Avoca Borrower in favour of the Security
Agent in respect of the Avoca Operating Account in the form set out in schedule
13;

     

    “Balloon Instalment” shall have
the meaning ascribed thereto in clause 4.1;

     

    “Banks” means the banks and
financial institutions listed in schedule 1 and includes their respective
successors in title and Transferee Banks and “Bank” means any of
them;

     

    “Banking Day” means a day on
which dealings in deposits in Dollars are carried on in the London Interbank
Eurocurrency Market and (other than Saturday or Sunday) on which banks are open
for business in London, Athens and New York City (or any other relevant place of
payment under clause 6);

     

    “Borrower”:

     

    
      	
               
      

            	
              (a)

            	
              in
      relation to Avoca
      and/or the Avoca Advance, means the Avoca Borrower;
  or

            

    

     

    
      	
               
      

            	
              (b)

            	
              in
      relation to Saldanha and/or the
      Saldanha Advance, means the Saldanha
Borrower,

            

    

     

    and
“Borrowers” means either
or both of them;

     

    “Borrowed Money” means
Indebtedness in respect of (i) money borrowed or raised and debit balances at
banks, (ii) any bond, note, loan stock, debenture or similar debt instrument,
(iii) acceptance or documentary credit facilities, (iv) receivables sold or
discounted (otherwise than on a non-recourse basis), (v) deferred payments for
assets or services acquired, (vi) finance leases and hire purchase contracts,
(vii) swaps, forward exchange contracts, futures and other derivatives, (viii)
any other transaction (including without limitation forward sale or purchase
agreements) having the commercial effect of a borrowing or raising of money or
of any of (ii) to (vii) above and (ix) guarantees in respect of Indebtedness of
any person falling within any of (i) to (viii) above;

     

    “Borrowers' Security Documents”
means, at any relevant time, such of the Security Documents as shall have been
executed by either of the Borrowers at such time;

     

    “Classification” means, in
relation to each Ship, the highest class available to a vessel of such Ship’s
type with the relevant Classification Society or such other classification as
the Agent shall, at the request of a Borrower, have agreed in writing shall be
treated as the Classification in relation to such Borrower's Ship for the
purposes of the relevant Ship Security Documents;

     

    “Classification Society” means
such classification society (being a member of the International Association of
Classification Societies (“IACS”)) which the Agent shall,
at the request of a Borrower, have agreed in writing shall be treated as the
Classification Society in relation to such Borrower's Ship for the purposes of
the relevant Ship Security Documents;

     

    “Code” means the International
Management Code for the Safe Operation of Ships and for Pollution Prevention
constituted pursuant to Resolution A. 741 (18) of the International Maritime
Organisation and incorporated into the Safety of Life at Sea Convention and
includes any amendments or extensions thereto and any regulation issued pursuant
thereto;

     

    “Commitment” means, in relation
to each Bank, the amount set out opposite its name in the column headed “Commitment” in schedule 1,
and/or, in the case of a Transferee Bank, the amount transferred as specified in
the relevant Transfer Certificate, as reduced in each case by any relevant term
of this Agreement;

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    
 

     

    “Compliance Certificate” means
each certificate received or (as the context may require) to be received by the
Agent pursuant to clause 5.1 of the Corporate Guarantee in the form set out in
the schedule to the Corporate Guarantee;

     

    “Compulsory Acquisition” means
requisition for title or other compulsory acquisition, requisition,
appropriation, expropriation, deprivation, forfeiture or confiscation for any
reason of a Ship by any Government Entity or other competent authority, whether
de jure or de facto, but shall exclude requisition for use or hire not involving
requisition of title;

     

    “Confirmation” shall have, in
relation to any continuing Designated Transaction, the meaning ascribed to it in
the Master Swap Agreement;

     

    “Contracts” means, together,
the Saldanha Contract and the Avoca Contract and “Contract” means either of
them;

     

    “Contribution” means, in
relation to each Bank, the principal amount of the Loan owing to such Bank at
any relevant time;

     

    “Corporate Guarantee” means the
corporate guarantee issued or (as the context may require) to be issued by the
Corporate Guarantor in favour of the Security Agent in the form set out in
schedule 9;

     

    “Corporate Guarantor” means
DryShips Inc. of Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro,
Marshall Islands MH96960, and includes its successors in title;

     

    “Creditors” means, together,
the Arranger, the Agent, the Security Agent, the Swap Provider, the Account Bank
and the Banks and “Creditor” means any of
them;

     

    “Deed of Covenant”
means:

     

    
      	
               
      

            	
              (a)

            	
              in
      relation to Saldanha, the Saldanha
      Deed of Covenant; or

            

    

     

    
      	
               
      

            	
              (b)

            	
              in
      relation to Avoca, the Avoca Deed
      of Covenant,

            

    

     

    and
“Deeds of Covenant”
means either or both of them;

     

    “Default” means any Event of
Default or any event or circumstance which with the giving of notice or lapse of
time or the satisfaction of any other condition (or any combination thereof)
would constitute an Event of Default;

     

    “Delivery Date” means, in
relation to each Ship, the date on which such Ship is delivered to, and accepted
by, the relevant Borrower in accordance with the relevant Contract;

     

    “Designated Transaction” means
a Transaction which fulfils the following requirements:

     

    
      	
               
      

            	
              (a)

            	
              it
      is entered into by the Borrowers pursuant to the Master Swap Agreement
      with the Swap Provider as contemplated by clause 2.9;
  and

            

    

     

    
      	
               
      

            	
              (b)

            	
              its
      purpose is the hedging of the Borrowers’ exposure under this Agreement to
      fluctuations of LIBOR arising from the funding of the Loan (or any part
      thereof) for a period expiring no later than the final Repayment Date for
      the Loan or the relevant part
thereof;

            

    

     

    “DOC” means a document of
compliance issued to an Operator in accordance with rule 13 of the
Code;

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    
 

     

    “Dollars” and “$” mean the lawful currency of
the United States of America and, in respect of all payments to be made under
any of the Security Documents, mean funds which are for same day settlement in
the New York Clearing House Interbank Payments System (or such other U.S. dollar
funds as may at the relevant time be customary for the settlement of
international banking transactions denominated in U.S. dollars);

     

    “Drawdown Date” means any date,
being a Banking Day falling during the Drawdown Period, on which an Advance is,
or is to be, made available;

     

    “Drawdown Notice” means, in
relation to each Advance, a notice substantially in the form of schedule 2
in respect of such Advance;

     

    “Drawdown Period” means, in
relation to each Advance, the period from the date of this Agreement and ending
on the earlier of (a) the Termination Date, (b) the date on which the aggregate
amount of the Advances is equal to the Total Commitment and (c) the date on
which the Total Commitment is reduced to zero pursuant to clauses 4.3, 10.2
or 12;

     

    “Early Termination Date” shall
have, in relation to any continuing Designated Transaction, the meaning ascribed
to it in the Master Swap Agreement;

     

    “Encumbrance” means any
mortgage, charge (whether fixed or floating), pledge, lien, hypothecation,
assignment, trust arrangement or security interest or other encumbrance of any
kind securing any obligation of any person or any type of preferential
arrangement (including without limitation title transfer and/or retention
arrangements) having a similar effect;

     

    “Environmental Affiliate” means
any agent or employee of either Borrower or any other Relevant Party or any
person having a contractual relationship with either Borrower or any other
Relevant Party in connection with any Relevant Ship or its operation or the
carriage of cargo and/or passengers thereon and/or the provision of goods and/or
services on or from such Relevant Ship;

     

    “Environmental Approval” means
any consent, authorisation, licence or approval of any governmental or public
body or authorities or courts applicable to any Relevant Ship or its operation
or the carriage of cargo and/or passengers thereon and/or the provision of goods
and/or services on or from such Relevant Ship required under any Environmental
Law;

     

    “Environmental Claim” means any
and all enforcement, clean-up, removal or other governmental or regulatory
actions or orders instituted or completed pursuant to any Environmental Law or
any Environmental Approval together with claims made by any third party relating
to damage, contribution, loss or injury, resulting from any actual or threatened
emission, spill, release or discharge of a Pollutant from any Relevant
Ship;

     

    “Environmental Laws” means all
national, international and state laws, rules, regulations, treaties and
conventions applicable to any Relevant Ship pertaining to the pollution or
protection of human health or the environment including, without limitation, the
carriage of Pollutants and actual or threatened emissions, spills, releases or
discharges of Pollutants;

     

    “Equity Ratio” in relation to a
Measurement Period, has the meaning given to it in the Corporate Guarantee for
the Accounting Period (as defined in the Corporate Guarantee) corresponding to
such Measurement Period;

     

    “Event of Default” means any of
the events or circumstances described in clause 10.1;

     

    “Fee Letter” means the letter
of even date herewith made between the Arranger, the Agent, the Borrowers and
the Corporate Guarantor in respect of certain of the fees payable under clause
5.1;

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    
 

     

    “First Repayment Date” means,
subject to clause 6.3, the date falling three (3) months after the earlier of
(a) the Drawdown Date of the second Advance to be drawn down under this
Agreement and (b) the Termination Date;

     

    “Flag State” means, in relation
to a Ship, Malta or such other state or territory designated in writing by the
Agent, at the request of the Borrower owning such Ship, as being the “Flag State” of such Ship for
the purposes of the relevant Ship Security Documents;

     

    “Government Entity” means and
includes (whether having a distinct legal personality or not) any national or
local government authority, board, commission, department, division, organ,
instrumentality, court or agency and any association, organisation or
institution of which any of the foregoing is a member or to whose jurisdiction
any of the foregoing is subject or in whose activities any of the foregoing is a
participant;

     

    “Group” means, together, the
Corporate Guarantor and its Subsidiaries from time to time (including, for the
avoidance of doubt, the Borrowers) and “member of Group” shall be
constructed accordingly;

     

    “Indebtedness” means any
obligation for the payment or repayment of money, whether as principal or as
surety and whether present or future, actual or contingent;

     

    “Interest Payment Date” means
the last day of an Interest Period;

     

    “Interest
Period” means, in relation to an Advance or (as the case may be) the
Loan, each period for the calculation of interest in respect of such Advance or
(as the case may be) the Loan, ascertained in accordance with clauses 3.2 and
3.3;

     

    “ISPS Code” means the
International Ship and Port Facility Security Code constituted pursuant to
resolution A.924(22) of the International Maritime Organization now set out in
Chapter XI-2 of the International Convention for the Safety of Life at Sea 1974
(as amended) as adopted by a Diplomatic conference of the International Maritime
Organisation on Maritime Security in December 2002 and includes any amendments
or extensions thereto and any regulation issued pursuant thereto;

     

    “ISSC” means, in relation to
each Ship, an International Ship Security Certificate issued in respect of that
Ship pursuant to the ISPS Code;

     

    “LIBOR” means in relation to a
particular period:

     

    
      	
               
      

            	
              (a)

            	
              the
      rate for deposits of the relevant currency for a period equivalent to such
      period at or about 11:00 a.m. on the Quotation Date for such period as
      displayed on Reuters page LIBOR 01 (British Bankers’
      Association Interest Settlement Rates) (or such other page as may replace
      such page LIBOR 01 on such system or on any other system of the
      information vendor for the time being designated by the British Bankers’
      Association to calculate the BBA Interest Settlement Rate (as defined in
      the British Bankers’ Association’s Recommended Terms and Conditions
      (“BBAIRS” terms)
      applicable at the relevant time));
or

            

    

     

    
      	
               
      

            	
              (b)

            	
              provided
      that if on such date no such rate is so displayed, LIBOR for such period
      shall be the arithmetic mean of the rates quoted to the Agent by the
      Reference Banks at the request of the Agent as the Reference Banks’
      offered rate for deposits of the relevant currency in an amount
      approximately equal to the amount in relation to which LIBOR is to be
      determined for a period equivalent to such period to prime banks in the
      London Interbank Market at or about 11:00 a.m. on the Quotation Date for
      such period;

            

    

     

    “Loan” means the aggregate
principal amount owing to the Banks under this Agreement at any relevant
time;

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    
 

     

    “Majority Banks” means, at any
relevant time, Banks (a) the aggregate of whose Contributions exceeds Sixty-six
point six per cent (66.6%) of the Loan or (b) (if no principal amounts are
outstanding under this Agreement) the aggregate of whose Commitments exceeds
Sixty-six point six per cent (66.6%) of the Total Commitment;

     

    “Manager” means Cardiff Marine
Inc. of 80 Broad Street, Monrovia, Liberia or any other person appointed by a
Borrower, with the prior written consent of the Majority Banks as the technical
and commercial manager of such Borrower’s Ship and includes its successors in
title;

     

    “Management Agreement”
means:

     

    
      	
               
      

            	
              (a)

            	
              in
      relation to Saldanha, the Saldanha
      Management Agreement; or

            

    

     

    
      	
               
      

            	
              (b)

            	
              in
      relation to Avoca, the Avoca
      Management Agreement,

            

    

     

    and
“Management Agreements”
means either or both of them;

     

    “Manager’s Undertaking”
means:

     

    
      	
               
      

            	
              (a)

            	
              in
      relation to Saldanha, the Saldanha
      Manager’s Undertaking; or

            

    

     

    
      	
               
      

            	
              (b)

            	
              in
      relation to Avoca, the Avoca
      Manager’s Undertaking,

            

    

     

    and
“Manager’s Undertakings”
means either or both of them;

     

    “Mandatory Cost” means, in
relation to any period, a percentage calculated by the Agent for such period at
an annual rate determined by the application of the formula set out in schedule
6;

     

    “Margin” means (as calculated
by the Agent pursuant to clause 3.1.2):

     

    
      	
               
      

            	
              (a)

            	
              (subject
      to paragraph (b) below) in relation to each Margin
  Period:

            

    

     

    
      	
               
      

            	
              (i)

            	
              if
      the Equity Ratio for the relevant Measurement Period shall be lower than
      0.45:1.00, one point two zero per cent (1.20%) per annum;
    or

            

    

     

    
      	
               
      

            	
              (ii)

            	
              if
      the Equity Ratio for the relevant Measurement Period shall be equal to or
      higher than 0.45:1.00 but equal to or lower than 0.55:1.00, one point one
      zero per cent (1.10%) per annum; or

            

    

     

    
      	
               
      

            	
              (iii)

            	
              if
      (A) the Equity Ratio for the relevant Measurement Period shall be higher
      than 0.55:1.00 or (B) an Event of Default has occurred and is continuing,
      one per cent (1%) per annum; or

            

    

     

    
      	
               
      

            	
              (b)

            	
              notwithstanding
      paragraph (a) above, Margin for any Margin Periods falling between the
      first Drawdown Date and 31 December 2008, shall be the higher of (i) one
      point one zero per cent (1.10%) per annum and (ii) the interest rate per
      annum determined for that period by the application of paragraph
      (a);

            

    

     

    “Margin Calculation Date” means
each 1 January (commencing with 1 January 2009) and 1 July (commencing with 1
July 2009) of each calendar year;

     

    “Margin Period” means each
period commencing on a Margin Calculation Date and ending on the day prior to
the subsequent Margin Calculation Date and “Margin Periods” means any or
all of them;

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    
 

     

    “Master Swap Agreement” means
the agreement made or (as the context may require) to be made between the Swap
Provider and the Borrowers comprising an ISDA Master Agreement (including the
Schedule) in the form set out in schedule 11 and includes any Designated
Transactions from time to time entered into and any Confirmations (as defined
therein) from time to time exchanged thereunder and governed
thereby;

     

    “Measurement Period”
means:

     

    
      	
               
      

            	
              (a)

            	
              in
      relation to each Margin Period commencing on 1 January of any calendar
      year, the nine-month period ending on 30 September of the immediately
      preceding calendar year; and

            

    

     

    
      	
               
      

            	
              (b)

            	
              in
      relation to each Margin Period commencing on 1 July of any calendar year,
      the twelve-month period ending on 31 December of the immediately preceding
      calendar year;

            

    

     

    “month” means a period
beginning in one calendar month and ending in the next calendar month on the day
numerically corresponding to the day of the calendar month on which it started,
provided that (a) if the period started on the last Banking Day in a
calendar month or if there is no such numerically corresponding day, it shall
end on the last Banking Day in such next calendar month and (b) if such
numerically corresponding day is not a Banking Day, the period shall end on the
next following Banking Day in the same calendar month but if there is no such
Banking Day it shall end on the preceding Banking Day and “months” and “monthly” shall be construed
accordingly;

     

    “Mortgage” means:

     

    
      	
               
      

            	
              (a)

            	
              in
      relation to Saldanha, the Saldanha
      Mortgage; or

            

    

     

    
      	
               
      

            	
              (b)

            	
              in
      relation to Avoca, the Avoca
      Mortgage,

            

    

     

    and
“Mortgages” means either
or both of them;

     

    “Mortgaged
Ship” means, at any relevant time, any Ship which is at such time subject
to a Mortgage and/or the Earnings, Insurances and Requisition Compensation (as
defined in the relevant Ship Security Documents) of which are subject to an
Encumbrance pursuant to the relevant Ship Security Documents and a Ship shall
for the purposes of this Agreement be deemed to be a Mortgaged Ship as from
whichever shall be the earlier of (a) the drawdown of the Advance relating to
that Ship and (b) the date that the Mortgage of that Ship shall have been
executed and registered in accordance with this Agreement until whichever shall
be the earlier of (i) the payment in full of the amount required by the Agent to
be paid pursuant to clause 4.3 following the sale or
Total Loss of such Ship and (ii) the date on which all moneys owing under the
Security Documents have been repaid in full;

     

    “Operating Account” means:

     

    
      	
               
      

            	
              (a)

            	
              in
      relation to Saldanha, the Saldanha
      Operating Account; or

            

    

     

    
      	
               
      

            	
              (b)

            	
              in
      relation to Avoca, the Avoca
      Operating Account,

            

    

     

    and
“Operating Accounts”
means either or both of them;

     

    “Operating Account Assignment”
means:

     

    
      	
               
      

            	
              (a)

            	
              in
      relation to Saldanha, the Saldanha
      Operating Account Assignment; or

            

    

     

    
      	
               
      

            	
              (b)

            	
              in
      relation to Avoca, the Avoca
      Operating Account Assignment,

            

    

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    
 

     

    and
“Operating Account
Assignments” means either or both of them;

     

    “Operator” means any person who
is from time to time during the Security Period (as defined in each Mortgage)
concerned in the operation of a Ship and falls within the definition of
“Company” set out in rule 1.1.2 of the Code;

     

    “Permitted Encumbrance” means
any Encumbrance in favour of the Security Agent created pursuant to the Security
Documents and Permitted Liens;

     

    “Permitted Liens” means, in
respect of each Ship:

     

    
      	
               
      

            	
              (a)

            	
              any
      lien on such Ship for master's, officer's or crew's wages outstanding in
      the ordinary course of trading;

            

    

     

    
      	
               
      

            	
              (b)

            	
              any
      lien for salvage; and

            

    

     

    
      	
               
      

            	
              (c)

            	
              any
      ship repairer's or outfitter's possessory lien for a sum not (except with
      the prior written consent of the Agent) exceeding the Casualty Amount (as
      defined in the relevant Ship Security Documents) for such
      Ship;

            

    

     

    “Pollutant” means and includes
pollutants, contaminants, toxic substances, oil as defined in the United States
Oil Pollution Act of 1990 and all hazardous substances as defined in the United
States Comprehensive Environmental Response, Compensation and Liability Act
1980;

     

    “Quotation Date” means, in
respect of any period for which LIBOR falls to be determined under this
Agreement, the second Banking Day before the first day of such
period;

     

    “Reference Banks” means the
Agent and any other bank or financial institution appointed as a Reference Bank
by the Agent from time to time;

     

    “Registry” means, in respect of
a Ship, such registrar, commissioner or representative of the relevant Flag
State who is duly authorised and empowered to register such Ship, the relevant
Borrower's title to such Ship and the relevant Mortgage under the laws and flag
of the relevant Flag State;

     

    “Related Company” of a person
means any Subsidiary of such person, any company or other entity of which such
person is a Subsidiary and any Subsidiary of any such company or
entity;

     

    “Relevant Jurisdiction” means
any jurisdiction in which or where any Security Party is incorporated, resident,
domiciled, has a permanent establishment, carries on, or has a place of business
or is otherwise effectively connected;

     

    “Relevant Party” means each of
the Borrowers, any other Security Party and any other member of the
Group;

     

    “Relevant Ship” means the Ships
and any other vessel from time to time (whether before or after the date of this
Agreement) owned, managed or crewed by, or chartered to, any Relevant
Party;

     

    “Repayment Dates” means,
subject to clause 6.3, the First Repayment Date and each of the dates falling at
three (3) monthly intervals thereafter up to and including the earlier of (a) 31
January 2015 and (b) the date falling eighty one (81) months after the First
Repayment Date;

     

    “Saldanha”
means the motor vessel Shinyo
Brilliance to be purchased by the relevant Seller and registered under
the laws and flag of Panama with IMO Number 9268992 and to be registered on its
Delivery Date under the name and in the ownership of the Saldanha Borrower
through the relevant Registry and under the laws and flag of the relevant Flag
State with the name Saldanha;

     

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    
 

     

    “Saldanha Advance” means an
Advance of up to Fifty two million five hundred thousand Dollars ($52,500,000)
made or (as the context may require) to be made available to the Borrowers for
the purpose of financing part of the acquisition cost of Saldanha by the Saldanha
Borrower pursuant to the Saldanha Contract;

     

    “Saldanha Borrower” means
Team-Up Owning Company Limited of Trust Company Complex, Ajeltake Road, Ajeltake
Island, Majuro, Marshall Islands, MH96960 and includes its successors in
title;

     

    “Saldanha Contract” means the
memorandum of agreement dated 6 August 2007 made between the relevant Seller and
the Manager, as novated in favour of the Saldanha Borrower pursuant to an
Addendum No. 1 thereto dated 7 August 2007 and as may be further amended and
supplemented from time to time, relating to the sale by the relevant Seller, and
the purchase by the Saldanha Borrower, of Saldanha;

     

    “Saldanha Contract Price” means
the purchase price payable by the Saldanha Borrower to the relevant Seller for
Saldanha under the
Saldanha Contract, being Seventy five million Dollars ($75,000,000) or such
other sum as is determined under the terms and conditions of the Saldanha
Contract to be the purchase price of Saldanha
thereunder;

     

    “Saldanha Deed of Covenant”
means the deed of covenant collateral to the Saldanha Mortgage executed or (as
the context may require) to be executed by the Saldanha Borrower in favour of
the Security Agent in the form set out in schedule 8;

     

    “Saldanha Management Agreement”
means the agreement dated 24 November 2007 made between the Saldanha Borrower,
the Corporate Guarantor and the Manager or any other agreement previously
approved in writing by the Agent between the Saldanha Borrower and the Manager
providing (inter alia)
for the Manager to manage Saldanha;

     

    “Saldanha Manager’s
Undertaking” means the undertaking and assignment in respect of Saldanha executed or (as the
context may require) to be executed by the Manager in favour of the Security
Agent in the form set out in schedule 10;

     

    “Saldanha Mortgage” means the
first priority statutory Maltese mortgage of Saldanha executed or (as the
context may require) to be executed by the Saldanha Borrower in favour of the
Security Agent in the form set out in schedule 7;

     

    “Saldanha Operating Account”
means an interest bearing Dollar account of the Saldanha Borrower opened or (as
the context may require) to be opened with the Account Bank and includes any
sub-accounts thereof and any other account designated in writing by the Agent to
be a Saldanha Operating Account for the purposes of this Agreement;

     

    “Saldanha Operating Account
Assignment” means a first priority assignment executed or (as the context
may require) to be executed by the Saldanha Borrower in favour of the Security
Agent in respect of the Saldanha Operating Account in the form set out in
schedule 13;

     

    “Security Agent” means DnB NOR
Bank ASA, a company incorporated in Norway with its registered office at
Stranden 21, P.O. Box 1171 Sentrum N-0107 Oslo, Norway, acting for the purposes
of this Agreement through its branch at 20 St. Dunstan’s Hill, London EC3R 8HY,
England (or of such other address as may last have been notified to the other
parties to this Agreement pursuant to clause 17.1.3) or such other person as may
be appointed as security agent and trustee by the Banks, the Agent and the Swap
Provider pursuant to clause 16 and includes its successors in
title;

     

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    
 

     

    “Security Documents” means this
Agreement, the Fee Letter, the Master Swap Agreement, the Mortgages, the Deeds
of Covenant, the Operating Account Assignments, the Corporate Guarantee, the
Manager’s Undertakings and the Swap Assignment and any other documents as may
have been or shall from time to time after the date of this Agreement be
executed to guarantee and/or secure all or any part of the Loan, interest
thereon and other moneys from time to time owing by the Borrowers and/or any
other Security Party pursuant to this Agreement and/or any other Security
Document (whether or not any such document also secures moneys from time to time
owing pursuant to any other document or agreement);

     

    “Security Party” means the
Borrowers, the Manager, the Corporate Guarantor or any other person who may at
any time be a party to any of the Security Documents (other than the
Creditors);

     

    “Security Requirement” means
the amount in Dollars (as certified by the Agent whose certificate shall, in the
absence of manifest error, be conclusive and binding on the Borrowers and the
other Creditors) which is at any relevant time, one hundred and twenty five per
cent (125%) of the aggregate of (a) the Loan and (b) the Swap Exposure, as at
the relevant time;

     

    “Security Value” means the
amount in Dollars (as certified by the Agent whose certificate shall, in the
absence of manifest error, be conclusive and binding on the Borrowers and the
other Creditors) which is, at any relevant time, the aggregate of (a) the market
value of the Mortgaged Ships as most recently determined in accordance with
clause 8.2.2 and (b) the market value of any additional security for the time
being actually provided to the Creditors pursuant to clause
8.2.1(b);

     

    “Seller” means:

     

    
      	
               
      

            	
              (a)

            	
              in
      respect of Saldanha, Golden Ocean
      Group Limited of Hamilton, Bermuda and includes its successors in title;
      or

            

    

     

    
      	
               
      

            	
              (b)

            	
              in
      respect of Avoca,
      Dampskibsselskabet Norden A/S of 49 Amaliegade, DK-1256 Copenhagen,
      Denmark and includes its successors in
title,

            

    

     

    and
“Sellers” means either
or both of them;

     

    “Ship”:

     

    
      	
               
      

            	
              (a)

            	
              in
      relation to the Saldanha Borrower and/or the Saldanha Advance, means Saldanha;
      or

            

    

     

    
      	
               
      

            	
              (b)

            	
              in
      relation to the Avoca Borrower and/or the Avoca Advance, means Avoca,

            

    

     

    and
“Ships” means either or
both of them;

     

    “Ship Security
Documents”:

     

    
      	
               
      

            	
              (a)

            	
              in
      respect of Saldanha, means the
      Saldanha Mortgage, the Saldanha Deed of Covenant and the Saldanha
      Manager’s Undertaking; or

            

    

     

    
      	
               
      

            	
              (b)

            	
              in
      respect of Avoca,
      means the Avoca Mortgage, the Avoca Deed of Covenant and the Avoca
      Manager’s Undertaking;

            

    

     

    “SMC” means a safety management
certificate issued in respect of a Ship in accordance with rule 13 of the
Code;

     

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    
 

     

    “Subsidiary” of a person means
any company or entity directly or indirectly controlled by such person, and for
this purpose “control”
means either the ownership of more than fifty per cent (50%) of the voting share
capital (or equivalent rights of ownership) of such company or entity or the
power to direct its policies and management, whether by contract or
otherwise;

     

    “Swap Assignment” means the
assignment executed or (as the context may require) to be executed by the
Borrowers in favour of the Security Agent in relation to certain of the rights
of the Borrowers under the Master Swap Agreement in the form set out in schedule
12;

     

    “Swap Exposure” means, as at
any relevant time, the amount certified by the Swap Provider to the Agent to be
the aggregate net amount in Dollars which would be payable by the Borrowers to
the Swap Provider under (and calculated in accordance with) section 6(e)
(Payments on Early Termination) of the Master Swap Agreement if an Early
Termination Date had occurred at the relevant time in relation to all continuing
Designated Transactions;

     

    “Swap Provider” means DnB NOR
Bank ASA, a company incorporated in Norway with its registered office at
Stranden 21, P.O. Box 1171 Sentrum, N-0107 Oslo, Norway acting for the purposes
of this Agreement through its branch at 20 St. Dunstan’s Hill, London EC3R 8HY,
England (or of such other address as may last have been notified to the other
parties to this Agreement pursuant to clause 17.1.3) and includes its successors
in title;

     

    “Taxes” includes all present
and future taxes, levies, imposts, duties, fees or charges of whatever nature
together with interest thereon and penalties in respect thereof and “Taxation” shall be construed
accordingly;

     

    “Termination Date” means 31
March 2008 or such later date as the Agent (acting on the instructions of all
the Banks) may in its absolute discretion agree in writing;

     

    “Total Commitment” means, at
any relevant time, the total of the Commitments of all the Banks at such time as
reduced by any relevant term of this Agreement;

     

    “Total Loss” in relation to a
Ship means:

     

    
      	
               
      

            	
              (a)

            	
              actual,
      constructive, compromised or arranged total loss of such Ship;
      or

            

    

     

    
      	
               
      

            	
              (b)

            	
              the
      Compulsory Acquisition of such Ship;
or

            

    

     

    
      	
               
      

            	
              (c)

            	
              the
      hijacking, theft, condemnation, capture, seizure, arrest, detention or
      confiscation of such Ship (other than where the same amounts to the
      Compulsory Acquisition of such Ship) by any Government Entity, or by
      persons acting or purporting to act on behalf of any Government Entity,
      unless such Ship be released and restored to the relevant Borrower from
      such hijacking, theft, condemnation, capture, seizure, arrest, detention
      or confiscation within thirty (30) days after the occurrence
      thereof;

            

    

     

    “Transaction” has the meaning
given in the Master Swap Agreement;

     

    “Transferee Bank” has the
meaning ascribed thereto in clause 15.3;

     

    “Transferor Bank” has the
meaning ascribed thereto in clause 15.3;

     

    “Transfer Certificate” means a
certificate in substantially the form set out in schedule 4;

     

    “Trust Deed” means a trust deed
in the form, or substantially in the form, set out in schedule 5;

     

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

    
 

     

    “Trust Property” means (i) the
security, powers, rights, titles, benefits and interests (both present and
future) constituted by and conferred on the Security Agent under or pursuant to
the Security Documents (including, without limitation, the benefit of all
covenants, undertakings, representations, warranties and obligations given, made
or undertaken to the Security Agent in the Security Documents), (ii) all moneys,
property and other assets paid or transferred to or vested in the Security Agent
or any agent of the Security Agent or any receiver or received or recovered by
the Security Agent or any agent of the Security Agent or any receiver pursuant
to, or in connection with, any of the Security Documents whether from any
Security Party or any other person and (iii) all money, investments, property
and other assets at any time representing or deriving from any of the foregoing,
including all interest, income and other sums at any time received or receivable
by the Security Agent or any agent of the Security Agent in respect of the same
(or any part thereof); and

     

    “Underlying Documents” means,
together, the Management Agreements and the Contracts and “Underlying Document” means any
of them.

     

    
      	
              1.3

            	
              Headings

            

    

     

    Clause headings
and the table of contents are inserted for convenience of reference only and
shall be ignored in the interpretation of this Agreement.

     

    
      	
              1.4

            	
              Construction
      of certain terms

            

    

     

    In this
Agreement, unless the context otherwise requires:

     

    
      	
              1.4.1

            	
              references
      to clauses and schedules are to be construed as references to
      clauses of, and schedules to, this Agreement and references to
      this Agreement include its
schedules;

            

    

     

    
      	
              1.4.2

            	
              references
      to (or to any specified provision of) this Agreement or any other document
      shall be construed as references to this Agreement, that provision or that
      document as in force for the time being and as amended in accordance with
      terms thereof, or, as the case may be, with the agreement of the relevant
      parties;

            

    

     

    
      	
              1.4.3

            	
              references
      to a “regulation”
      include any present or future regulation, rule, directive, requirement,
      request or guideline (whether or not having the force of law) of any
      agency, authority, central bank or government department or any
      self-regulatory or other national or supra-national
    authority;

            

    

     

    
      	
              1.4.4

            	
              words
      importing the plural shall include the singular and vice
      versa;

            

    

     

    
      	
              1.4.5

            	
              references
      to a time of day are to London
time;

            

    

     

    
      	
              1.4.6

            	
              references
      to a person shall be construed as references to an individual, firm,
      company, corporation, unincorporated body of persons or any Government
      Entity;

            

    

     

    
      	
              1.4.7

            	
              references
      to a “guarantee”
      include references to an indemnity or other assurance against financial
      loss including, without limitation, an obligation to purchase assets or
      services as a consequence of a default by any other person to pay any
      Indebtedness and “guaranteed” shall be
      construed accordingly; and

            

    

     

    
      	
              1.4.8

            	
              references
      to any enactment shall be deemed to include references to such enactment
      as re-enacted, amended or extended.

            

    

     

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

    
 

     

    
      	
              1.5

            	
              Majority
      Banks

            

    

     

    Where
this Agreement provides for any matter to be determined by reference to the
opinion of the Majority Banks or to be subject to the consent or request of the
Majority Banks or for any action to be taken on the instructions in writing of
the Majority Banks, such opinion, consent, request or instructions shall (as
between the Banks) only be regarded as having been validly given or issued by
the Majority Banks if all the Banks shall have received prior notice of the
matter on which such opinion, consent, request or instructions are required to
be obtained and the relevant majority of Banks shall have given or issued such
opinion, consent, request or instructions but so that (as between the Borrowers
and the Creditors) the Borrowers shall be entitled (and bound) to assume that
such notice shall have been duly received by each Bank and that the relevant
majority shall have been obtained to constitute Majority Banks whether or not
this is in fact the case.

     

    
      	
              1.6

            	
              Banks’
      Commitment

            

    

     

    For the
purposes of the definition of “Majority Banks” in clause 1.2
and the relevant provisions of the Security Documents, references to the
Commitment of a Bank shall, if the Total Commitment has, at
any relevant time, been reduced to zero, be deemed to be a reference to the
Commitment of that Bank immediately prior to such reduction to
zero.

     

    
      	
              
                2

              

            	
               

            	
              The
      Total Commitment and the Advances

            

    

     

    
      	
              2.1

            	
              Agreement
      to lend

            

    

     

    The Banks, relying upon each of the representations and warranties in
clause 7, agree to lend to the Borrowers, jointly and
severally, in two (2) Advances upon and subject to the terms of this Agreement
the aggregate principal sum of up to One hundred and one million one hundred and
fifty thousand Dollars ($101,150,000).  The obligation of each Bank
under this Agreement shall be to contribute that proportion of each Advance
which, as at the Drawdown Date of such Advance, such Bank’s Commitment bears to
the Total Commitment.

     

    
      	
              2.2

            	
              Obligations
      several

            

    

     

    The
obligations of the Banks under this Agreement are several according to their
respective Commitments and/or Contributions; the failure of any Bank to perform
such obligations or the failure of the Swap Provider to perform its obligations
under the Master Swap Agreement shall not relieve any other Creditor or the
Borrowers or either of them of any of their respective obligations or
liabilities under this Agreement or, as the case may be, the Master Swap
Agreement nor shall any Creditor be responsible for the obligations of any
Creditors (except for its own obligations, if any, as a Bank or Swap Provider)
under this Agreement or the Master Swap Agreement.

     

    
      	
              2.3

            	
              Interests
      several

            

    

     

    Notwithstanding
any other term of this Agreement (but without prejudice to the provisions of
this Agreement relating to or requiring action by the Majority Banks) the
interests of the Creditors are several and the amount due to any Creditor is a
separate and independent debt.  Each Creditor shall have the right to
protect and enforce its rights arising out of this Agreement and it shall not be
necessary for any other Creditor to be joined as an additional party in any
proceedings for this purpose.

     

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

     

     

    
      	
              2.4

            	
              Drawdown

            

    

     

    Subject
to the terms and conditions of this Agreement, each Advance shall be made to the
Borrowers following receipt by the Agent from the Borrowers of a Drawdown Notice
not later than 10:00 a.m. on the third Banking Day before the proposed Drawdown
Date which shall be a Banking Day falling within the Drawdown
Period.  A Drawdown Notice shall be effective on actual receipt by the
Agent and, once given, shall, subject as provided in clause 3.6.1, be
irrevocable.

     

    
      	
              2.5

            	
              Timing
      and limitation of Advances

            

    

     

    
      	
              2.5.1

            	
              The
      aggregate of both Advances shall not exceed the Total
      Commitment.

            

    

     

    
      	
              2.5.2

            	
              The
      Saldanha Advance shall not exceed the lower of (a) Fifty two million five
      hundred thousand Dollars ($52,500,000) and (b) seventy per cent (70%) of
      the Saldanha Contract Price.

            

    

     

    
      	
              2.5.3

            	
              The
      Avoca Advance shall not exceed the lower of (a) Forty eight million six
      hundred and fifty thousand Dollars ($48,650,000) and (b) seventy per cent
      (70%) of the Avoca Contract Price.

            

    

     

    
      	
              2.5.4

            	
              Each
      Advance shall be made solely for the purpose of financing part of the
      acquisition cost of the Ship relevant to such Advance pursuant to the
      relevant Contract.

            

    

     

    
      	
              2.6

            	
              Availability

            

    

     

    Upon
receipt of a Drawdown Notice complying with the terms of this Agreement the
Agent shall promptly notify each Bank and, subject to the provisions of
clause 9, on the Drawdown Date for the relevant Advance, each Bank shall
make available to the Agent its portion of such Advance for payment by the Agent
in accordance with clause 6.2.  The Borrowers acknowledge that payment
of each Advance or part thereof to the relevant Seller, in accordance with
clause 6.2, shall satisfy the obligations of the Banks to lend such Advance or
part thereof to the Borrowers.

     

    
      	
              2.7

            	
              Termination
      of Total Commitment

            

    

     

    Any
part of the Total Commitment which remains undrawn and uncancelled by the
Termination Date shall thereupon be automatically cancelled.

     

    
      	
              2.8

            	
              Application
      of proceeds

            

    

     

    Without
prejudice to the Borrowers’ obligations under clause 8.1.3, none of the
Creditors shall have any responsibility for the application of the proceeds of
the Loan or part thereof by the Borrowers.

     

    
      	
              2.9

            	
              Derivative
      transactions

            

    

     

    
      	
              2.9.1

            	
              If,
      at any time during the Security Period, the Borrowers wish to enter into
      interest rate swap or other derivative transactions so as to hedge all or
      any part of their exposure under this Agreement to interest rate
      fluctuations, they shall advise the Swap Provider in
    writing.

            

    

     

    
      	
              2.9.2

            	
              Any
      such swap or other derivative transaction shall be concluded with the Swap
      Provider under the Master Swap Agreement provided however that no such
      swap or other derivative transaction shall be concluded unless the Swap
      Provider first agrees to it in writing.  For the avoidance of
      doubt, other than the Swap Provider’s agreement in writing referred to in
      the preceding sentence no prior approval is required by the Borrowers from
      any other Creditor before concluding any such transaction.  If
      and when any such swap or other derivative transaction has been concluded,
      it shall constitute a Designated Transaction, and the Borrowers shall sign
      a Confirmation with the Swap Provider and advise the Banks through the
      Agent promptly after concluding any Designated
  Transaction.

            

    

     

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

    
 

     

    
      	
              
                3

              

            	
               

            	
              Interest
      and Interest Periods

            

    

     

    
      	
              3.1

            	
              Normal
      interest rate

            

    

     

    
      	
              3.1.1

            	
              General

            

    

     

    The
Borrowers shall pay interest on each Advance in respect of each Interest Period
relating thereto on each Interest Payment Date (or, in the case of Interest
Periods of more than three (3) months, by instalments, the first instalment
three (3) months from the commencement of the Interest Period and the subsequent
instalments at intervals of three (3) months or, if shorter, the period from the
date of the preceding instalment until the Interest Payment Date relative to
such Interest Period) at the rate per annum determined by the Agent to be the
aggregate of (a) the Margin, (b) LIBOR for such Interest Period and (c)
Mandatory Cost (if any).

     

    
      	
               
      

            	
              3.1.2

            	
              Calculation
      of Margin

            

    

     

    The
Agent shall, on or before each Margin Calculation Date (such Margin Calculation
Date for the purposes of this clause 3.1, the “calculation day”), calculate,
based on the then latest consolidated financial statements of the Group and the
Compliance Certificate delivered to it pursuant to clause 5.1 of the Corporate
Guarantee, the Equity Ratio in respect of the Measurement Period relevant to the
Margin Period commencing on such calculation day and, based on such calculation,
the Agent shall determine, and notify the Borrower and the Banks of, the Margin
that shall apply during the Margin Period commencing on such calculation
day.

     

    
      	
              3.2

            	
              Selection
      of Interest Periods

            

    

     

    The
Borrowers may by notice received by the Agent not later than 10:00 a.m. on the
third Banking Day before the beginning of each Interest Period specify whether
such Interest Period shall have a duration of one (1), three (3), six (6) or
twelve (12) months or such other period (shorter than twelve (12) months) as the
Borrowers may select and the Agent (acting on the instructions of the Majority
Banks) may agree.

     

    
      	
              3.3

            	
              Determination
      of Interest Periods

            

    

     

    Every
Interest Period shall be of the duration specified by the Borrowers pursuant to
clause 3.2 but so that:

     

    
      	
              3.3.1

            	
              the
      initial Interest Period in respect of each Advance shall commence on the
      Drawdown Date for such Advance and each subsequent Interest Period for
      such Advance shall commence on the last day of the previous Interest
      Period for such Advance;

            

    

     

    
      	
              3.3.2

            	
              the
      initial Interest Period for the second Advance to be drawn down shall end
      on the last day of the then current Interest Period for the first Advance
      drawn down and, on such day, both drawn Advances shall be consolidated
      into, and shall thereafter constitute the
Loan;

            

    

     

    
      	
              3.3.3

            	
              if
      any Interest Period would otherwise overrun a Repayment Date, then, in the
      case of the last Repayment Date, such Interest Period shall end on such
      Repayment Date, and in the case of any other Repayment Date or Repayment
      Dates, the Loan shall be divided into parts so that there is one part in
      the amount of the repayment instalment due on each Repayment Date falling
      during that Interest Period and having an Interest Period ending on the
      relevant Repayment Date and another part in the amount of the balance of
      the Loan having an Interest Period ascertained in accordance with
      clause 3.2 and the other provisions of this clause 3.3;
      and

            

    

     

    
      
         

      

      
        16

        
          

        

      

      
         

      

    

    
 

     

    
      	
              3.3.4

            	
              if
      the Borrowers fail to specify the duration of an Interest Period in
      accordance with the provisions of clause 3.2 and this clause 3.3 such
      Interest Period shall have a duration of three (3) months or such other
      period as shall comply with this clause
3.3.

            

    

     

    
      	
              3.4

            	
              Default
      interest

            

    

     

    
      If the Borrowers or either of them fail
to pay any sum (including, without limitation, any sum payable pursuant to this
clause 3.4) on its due date for payment under any of the Security Documents
(except the Master Swap Agreement), the Borrowers shall pay interest on such sum
on demand from the due date up to the date of actual payment (as well after as
before judgment) at a rate determined by the Agent pursuant to this clause
3.4.  The period beginning on such due date and ending on such date of
payment shall be divided into successive periods of not more than six (6) months
as selected by the Agent each of which (other than the first, which shall
commence on such due date) shall commence on the last day of the preceding such
period.  The rate of interest applicable to each such period shall be
the aggregate (as determined by the Agent) of (a) two per cent (2%) per annum,
(b) the Margin, (c) LIBOR for such period and (d) the Mandatory Cost (if
any).  Such interest shall be due and payable on the last day of each
such period as determined by the Agent and each such day shall, for the purposes
of this Agreement, be treated as an Interest Payment Date, provided that if such
unpaid sum is an amount of principal which became due and payable by reason of a
declaration by the Agent under clause
10.2.2 or a prepayment
pursuant to clauses 4.3, 8.2.1 or
12.1, on a
date other than an Interest Payment Date relating thereto, the first such period
selected by the Agent shall be of a duration equal to the period between the due
date of such principal sum and such Interest Payment Date and interest shall be
payable on such principal sum during such period at a rate of ) two per cent
(2%) above the rate applicable thereto immediately before it shall have become
so due and payable.  If, for the reasons specified in clause
3.6.1, the
Agent is unable to determine a rate in accordance with the foregoing provisions
of this clause 3.4, each Bank shall
promptly notify the Agent of the cost of funds to such Bank and interest on any
sum not paid on its due date for payment shall be calculated at a rate determined by the Agent to be
) two per cent (2%) per annum above the aggregate of the Margin and the cost of
funds to such Bank (including Mandatory Costs, if
any).

    
      	
              3.5

            	
              Notification
      of Interest Periods and interest
rate

            

    

     

    The
Agent shall notify the Borrowers and the Banks promptly of the duration of each
Interest Period and of each rate of interest (or, as the case may be default
interest) determined by it under this clause 3.

     

    
      	
              3.6

            	
              Market
      disruption; non-availability

            

    

     

    
      	
              3.6.1

            	
              If
      and whenever, at any time prior to the commencement of any Interest
      Period:

            

    

     

    
      	
               
      

            	
              (a)

            	
              the
      Agent shall have determined (which determination shall, in the absence of
      manifest error, be conclusive) that adequate and fair means do not exist
      for ascertaining LIBOR during such Interest Period;
  or

            

    

     

    
      	
               
      

            	
              (b)

            	
              where
      applicable, none of the Reference Banks supplies the Agent with a
      quotation for the purpose of calculating LIBOR;
  or

            

    

     

    
      	
               
      

            	
              (c)

            	
              the
      Agent shall have received notification from Banks whose aggregate
      Contributions are not less than one-third (1/3rd) of the Loan (or, prior
      to the first Drawdown Date, whose aggregate Commitments are not less than
      one-third (1/3rd) of the Total Commitment), that
      deposits in Dollars are not available to such Banks in the London
      Interbank Market in the ordinary course of business in sufficient amounts
      to fund their Commitments or their Contributions for such Interest Period
      or that LIBOR does not accurately reflect the cost to such Banks of
      obtaining such deposits,

            

    

     

    
      
         

      

      
        17

        
          

        

      

      
         

      

    

     

    the
Agent shall forthwith give notice (a “Determination Notice”) thereof
to the Borrowers and to each of the Banks and the Swap Provider.  A
Determination Notice shall contain particulars of the relevant circumstances
giving rise to its issue.  After the giving of any Determination
Notice the undrawn amount of the Total Commitment shall not be borrowed until
notice to the contrary is given to the Borrowers by the Agent.

     

    
      	
              3.6.2

            	
              During
      the period of ten (10) days after any Determination Notice has been given
      by the Agent under clause 3.6.1, each Bank shall
      certify an alternative basis (the “Alternative
      Basis”) for funding its Commitment or for maintaining its
      Contribution.  The Alternative Basis may at the Bank’s sole and
      unfettered discretion (without limitation) include alternative interest
      periods, alternative currencies or alternative rates of interest but shall
      include a margin above the cost of funds to such Bank equivalent to the
      Margin.  The Agent shall calculate the arithmetic mean of the
      Alternative Basis provided by the relevant Banks (the “Substitute
      Basis”) and certify the same to the Borrowers, the Banks and the
      Swap Provider.  The Substitute Basis so certified shall be
      binding upon the Borrowers and shall take effect in accordance with its
      terms from the date specified in the Determination Notice until such time
      as the Agent notifies the Borrowers that none of the circumstances
      specified in clause 3.6.1 continues to
      exist whereupon the normal interest rate fixing provisions of this
      Agreement shall
apply.

            

    

     

    
      	
              3.7

            	
              Reference
      Bank quotations

            

    

     

    If any
Reference Bank is unable or otherwise fails to furnish a quotation for the
purposes of calculating LIBOR, the interest rate shall be determined, subject to
clause 3.6, on the basis of quotations furnished by the other Reference Banks
(if any).

     

    
      	
              
                4

              

            	
               

            	
              Repayment
      and prepayment

            

    

     

    
      	
              4.1

            	
              Repayment

            

    

     

    The
Borrowers shall repay the Loan by twenty eight (28) instalments, one such
instalment to be repaid on each of the Repayment Dates.  Subject to
the provisions of this Agreement, the amount of each of the first to eighth
instalments (inclusive) shall be Three million one hundred and twenty five
thousand Dollars ($3,125,000), the amount of each of the ninth to twenty seventh
instalments (inclusive) shall be Two million two hundred thousand Dollars
($2,200,000) and the amount of the twenty eighth and final instalment shall be
Thirty four million three hundred and fifty thousand Dollars ($34,350,000)
(comprising a repayment instalment of Two million two hundred thousand Dollars
($2,200,000) and a balloon payment of Thirty two million one hundred and fifty
Dollars ($32,150,000) (such balloon payment, the “Balloon
Instalment”)).

     

    If the
Total Commitment is not drawn down in full, the amount of each repayment
instalment (including the relevant Balloon Instalment) shall be reduced
proportionately.

     

    
      	
              4.2

            	
              Voluntary
      prepayment

            

    

     

    The
Borrowers may prepay the Loan in whole or part (being One million Dollars or any
larger sum which is an integral multiple of One million Dollars), on any
Interest Payment Date relating to the part of the Loan to be prepaid without
premium or penalty.

     

    
      	
              4.3

            	
              Cancellation
      of Commitments and prepayment on Total Loss

            

    

     

    
      	
              4.3.1

            	
              Before
      drawdown

            

    

     

    On a
Ship becoming a Total Loss (or suffering damage or being involved in an incident
which in the opinion of the Agent may result in such Ship being subsequently
determined to be a Total Loss) before the Advance in respect of such Ship is
drawn down, the obligations of the Banks to make such Advance available shall
immediately cease and the Total Commitment shall be reduced by the amount of
such Advance.

     

    
      
         

      

      
        18

        
          

        

      

      
         

      

    

    
 

     

    
      	
              4.3.2

            	
              Thereafter

            

    

     

    On the
date one hundred and twenty (120) days after that on which a Mortgaged Ship
became a Total Loss or, if earlier, on the date upon which the insurance
proceeds in respect of such Total Loss are, or Requisition Compensation (as
defined in the relevant Ship Security Documents) is, received by the relevant
Borrower (or the Security Agent pursuant to the relevant Ship Security
Documents), the Borrowers shall prepay such part of the Loan as is equal to the
Relevant Amount.

     

    
      	
              4.3.3

            	
              Relevant
      Amount

            

    

     

    For the
purposes of clause 4.3.2, “Relevant Amount” means, at any
relevant time and in relation to a Mortgaged Ship which has become a Total Loss
or is sold:

     

    
      	
               
      

            	
              (a)

            	
              50%
      of the Loan, if there is another Mortgaged Ship at that time;
      or

            

    

     

    
      	
               
      

            	
              (b)

            	
              100%
      of the Loan, if there is no other Mortgaged Ship at that
    time.

            

    

     

    
      	
              4.3.4

            	
              Total
      Loss

            

    

     

    For the
purpose of this Agreement, a Total Loss shall be deemed to have
occurred:

     

    
      	
               
      

            	
              (a)

            	
              in
      the case of an actual total loss of a Ship, on the actual date and at the
      time such Ship was lost or, if such date is not known, on the date on
      which such Ship was last reported;

            

    

     

    
      	
               
      

            	
              (b)

            	
              in
      the case of a constructive total loss of a Ship, upon the date and at the
      time notice of abandonment of such Ship is given to the insurers of such
      Ship for the time being;

            

    

     

    
      	
               
      

            	
              (c)

            	
              in
      the case of a compromised or arranged total loss of a Ship, on the date
      upon which a binding agreement as to such compromised or arranged total
      loss has been entered into by the insurers of such
  Ship;

            

    

     

    
      	
               
      

            	
              (d)

            	
              in
      the case of Compulsory Acquisition, on the date upon which the relevant
      requisition of title or other compulsory acquisition occurs;
      and

            

    

     

    
      	
               
      

            	
              (e)

            	
              in
      the case of hijacking, theft, condemnation, capture, seizure, arrest,
      detention or confiscation of a Ship (other than where the same amounts to
      Compulsory Acquisition of such Ship) by any Government Entity, or by
      persons purporting to act on behalf of any Government Entity, which
      deprives the relevant Borrower of the use of such Ship for more than
      thirty (30) days, upon the expiry of the period of thirty (30) days after
      the date upon which the relevant hijacking, theft, condemnation, capture,
      seizure, arrest, detention or confiscation
  occurred.

            

    

     

    
      	
              4.4

            	
              Amounts
      payable on prepayment

            

    

     

    Any
prepayment of all or part of the Loan under this Agreement shall be made
together with:

     

    
      	
               
      

            	
              (a)

            	
              accrued
      interest on the amount to be prepaid to the date of such
      prepayment;

            

    

     

    
      	
               
      

            	
              (b)

            	
              any
      additional amount payable under clauses 6.6 or
      12.2;
      and

            

    

     

    
      	
               
      

            	
              (c)

            	
              all
      other sums payable by the Borrowers to the Creditors under this Agreement
      or any of the other Security Documents including, without limitation, any
      amounts payable under
clause 11.1.

            

    

     

    
      
         

      

      
        19

        
          

        

      

      
         

      

    

    
 

     

    
      	
              4.5

            	
              Notice
      of prepayment; reduction of repayment
  instalments

            

    

     

    No prepayment
may be effected under clause 4.2 unless the Borrowers
shall have given the Agent at least three (3) Banking Days’ prior written notice
of their intention to make such prepayment.  Every notice of
prepayment shall be effective only on actual receipt by the Agent, shall be
irrevocable, shall specify the amount to be prepaid and shall oblige the
Borrowers to make such prepayment on the date specified.  No amount
prepaid under this Agreement may be re-borrowed.  Any amount prepaid
pursuant to clauses 4.2, 4.3 or 8.2.1 shall be applied in reducing the repayment
instalments under clause 4.1 (including the Balloon Instalment)
proportionately.  The Borrowers may not prepay the Loan or any part
thereof save as expressly provided in this Agreement.

     

    
      	
              4.6

            	
              Unwinding of Designated
      Transactions

            

    

     

    On or
prior to any repayment or prepayment of all or part of the Loan (including,
without limitation, pursuant to clauses 4.2, 4.3 or 8.2.1), the Borrowers shall
upon the request of the Swap Provider wholly or partially reverse, offset,
unwind, cancel, close out, net out or otherwise terminate one or more of the
continuing Designated Transactions so that the notional principal amount of the
continuing Designated Transactions thereafter remaining does not and will not in
the future (taking into account the scheduled amortisation) exceed the amount of
the Loan as reducing from time to time thereafter pursuant to clause
4.1.

     

    
      	
              5

            	
              Fees
      and expenses

            

    

     

    
      	
              5.1

            	
              Fees

            

    

     

    The
Borrowers shall pay to the Agent:

     

    
      	
              5.1.1

            	
              for
      the account of the Arranger, on the date of this Agreement, an
      underwriting fee of such amount as is specified in the Fee
      Letter;

            

    

     

    
      	
              5.1.2

            	
              if
      more than one Bank becomes a party to this Agreement as a Transferee Bank
      at any time, for the account of the Agent on the date when each such
      Transferee Bank becomes a party hereto and at twelve (12) monthly
      intervals thereafter, until all moneys owing under the Security Documents
      have been repaid in full, an annual agency fee in respect of each such
      Transferee Bank, of such amount per annum as is specified in the Fee
      Letter; and

            

    

     

    
      	
              5.1.3

            	
              for
      the account of each Bank pro rata in accordance with its Commitment, on
      each of the dates falling at three (3) monthly intervals after the date of
      this Agreement until the last day of the last Drawdown Period and on such
      day, commitment commission computed from the date of this Agreement (in
      the case of the first payment of commission) and from the due date of the
      preceding payment of commission (in the case of each subsequent payment),
      at the rate of zero point four zero per cent (0.40%) per annum on the
      daily undrawn amount of the Total
Commitment.

            

    

     

    The
fees referred to in clauses 5.1.1 and 5.1.2 and the commission referred to in
clause 5.1.3 shall be payable by the Borrowers, whether or not any part of the
Total Commitment is ever advanced and shall be non-refundable.

     

    
      	
              5.2

            	
              Expenses

            

    

     

    The
Borrowers shall pay to the Agent on a full indemnity basis on demand all
expenses (including legal, printing and out-of-pocket expenses) incurred by the
Creditors or any of them:

     

    
      	
              5.2.1

            	
              in
      connection with the negotiation, preparation, execution and, where
      relevant, registration of the Security Documents and of any amendment or
      extension of or the granting of any waiver or consent under, any of the
      Security Documents and the syndication of the Loan;
  and

            

    

     

    
      
         

      

      
        20

        
          

        

      

      
         

      

    

    
 

     

    
      	
              5.2.2

            	
              in
      contemplation of, or otherwise in connection with, the enforcement of, or
      preservation of any rights under, any of the Security Documents, or
      otherwise in respect of the moneys owing under any of the Security
      Documents,

            

    

     

    together with
interest at the rate referred to in clause 3.4 from the date on which
such expenses were incurred to the date of payment (as well after as before
judgment).

     

    
      	
              5.3

            	
              Value
      added tax

            

    

     

    All
fees and expenses payable pursuant to this clause 5 and/or pursuant to the
Security Documents shall be paid together with value added tax or any similar
tax (if any) properly chargeable thereon.  Any value added tax
chargeable in respect of any services supplied by the Creditors or any of them
under this Agreement shall, on delivery of the value added tax invoice, be paid
in addition to any sum agreed to be paid hereunder.

     

    
      	
              5.4

            	
              Stamp
      and other duties

            

    

     

    The
Borrowers shall pay all stamp, documentary, registration or other like duties or
taxes (including any duties or taxes payable by, or assessed on, the Creditors
or any of them) imposed on or in connection with any of the Underlying
Documents, the Security Documents or the Loan and shall indemnify the Creditors
or any of them against any liability arising by reason of any delay or omission
by the Borrowers to pay such duties or taxes.

     

    
      	
              6

            	
              Payments
      and taxes; accounts and
calculations

            

    

     

    
      	
              6.1

            	
              No
      set-off or counterclaim

            

    

     

    The Borrowers
acknowledge that in performing their respective obligations under this
Agreement, the Banks will be incurring liabilities to third parties in relation
to the funding of amounts to the Borrowers, such liabilities matching the
liabilities of the Borrowers to the Banks and that it is reasonable for the
Banks to be entitled to receive payments from the Borrowers gross on the due
date in order that each of the Banks is put in a position to perform its
matching obligations to the relevant third parties.  All payments to
be made by the Borrowers under any of the Security Documents shall be made in
full, without any set-off or counterclaim whatsoever and, subject as provided in
clause 6.6,
free and clear of any deductions or withholdings, in Dollars on the due date to
such account at such bank and in such place as the Agent may from time to time
specify for this purpose.  Save for payments which are for the account
of the Swap Provider and save as otherwise provided in this Agreement or any
relevant Security Documents such payments shall be for the account of all Banks
and the Agent or, as the case may be, the Security Agent shall distribute such
payments in like funds as are received by the Agent or, as the case may be, the
Security Agent to the Banks rateably in accordance with their respective
Commitment or (if after the first drawdown) Contribution, as the case may
be.

     

    
      	
              6.2

            	
              Payment
      by the Banks

            

    

     

    All
sums to be advanced by the Banks to the Borrowers under this Agreement shall be
remitted in Dollars on the Drawdown Date for the relevant Advance to the account
of the Agent at such bank as the Agent may have notified to the Banks and shall
be paid by the Agent to the account of the relevant Seller specified in the
Drawdown Notice for such Advance.

     

    
      	
              6.3

            	
              Non-Banking
      Days

            

    

     

    When
any payment under any of the Security Documents would otherwise be due on a day
which is not a Banking Day, the due date for payment shall be extended to the
next following Banking Day unless such Banking Day falls in the next calendar
month in which case payment shall be made on the immediately preceding Banking
Day.

     

    
      
         

      

      
        21

        
          

        

      

      
         

      

    

     

     

    
      	
              6.4

            	
              Calculations

            

    

     

    All
interest and other payments of an annual nature under any of the Security
Documents shall accrue from day to day and be calculated on the basis of actual
days elapsed and a three hundred and sixty (360) day year.

     

    
      	
              6.5

            	
              Certificates
      conclusive

            

    

     

    Any
certificate or determination of the Agent or the Security Agent or any Bank or
the Swap Provider as to any rate of interest or any other amount pursuant to and
for the purposes of any of the Security Documents shall, in the absence of
manifest error, be conclusive and binding on the Borrowers and (in the case of a
certificate or determination by the Agent or the Security Agent) on the other
Creditors.

     

    
      	
              6.6

            	
              Grossing-up
      for Taxes

            

    

     

    
      	
              6.6.1

            	
              If
      at any time the Borrowers are required to make any deduction or
      withholding in respect of Taxes from any payment due under any of the
      Security Documents for the account of any Creditor (or if the Agent or, as
      the case may be, the Security Agent is required to make any such deduction
      or withholding from a payment to a Bank), the sum due from the Borrowers
      in respect of such payment shall be increased to the extent necessary to
      ensure that, after the making of such deduction or withholding, the
      relevant Creditor receives on the due date for such payment (and retains,
      free from any liability in respect of such deduction or withholding), a
      net sum equal to the sum which it would have received had no such
      deduction or withholding been required to be made and the Borrowers shall
      indemnify each Creditor against any losses or costs incurred by it by
      reason of any failure of the Borrowers to make any such deduction or
      withholding or by reason of any increased payment not being made on the
      due date for such payment.  The Borrowers shall promptly deliver
      to the Agent any receipts, certificates or other proof evidencing the
      amounts (if any) paid or payable in respect of any deduction or
      withholding as aforesaid.

            

    

     

    
      	
              6.6.2

            	
              For
      the avoidance of doubt, clause 6.6.1 does not apply in respect of sums due
      from the Borrowers to the Swap Provider under or in connection with the
      Master Swap Agreement as to which sums the provisions of section 2(d)
      (Deduction or Withholding for Tax) of the Master Swap Agreement shall
      apply.

            

    

     

    
      	
              6.7

            	
              Loan
      account

            

    

     

    Each
Bank shall maintain, in accordance with its usual practice, an account
evidencing the amounts from time to time lent by, owing to and paid to it under
the Security Documents. The Security Agent shall maintain a control account
(which shall be the account current referred to in each Mortgage) showing the
Loan, interest and other sums owing and/or payable by the Borrowers under the
Security Documents.  The control account shall, in the absence of
manifest error, be conclusive as to the amount from time to time owing by the
Borrowers under the Security Documents.

     

    
      	
              6.8

            	
              Agent
      may assume receipt

            

    

     

    Where
any sum is to be paid under this Agreement to the Agent for the account of
another person, the Agent may assume that the payment will be made when due and
may (but shall not be obliged to) make such sum available to the person so
entitled.  If it proves to be the case that such payment was not made
to the Agent, then the person to whom such sum was so made available shall on
request refund such sum to the Agent together with interest thereon sufficient
to compensate the Agent for the cost of making available such sum up to the date
of such repayment and the person by whom such sum was payable shall indemnify
the Agent for any and all loss or expense which the Agent may sustain or incur
as a consequence of such sum not having been paid on its due date.

     

    
      
         

      

      
        22

        
          

        

      

      
         

      

    

    
 

     

    
      	
              6.9

            	
              Partial
      payments

            

    

     

    If, on
any date on which a payment is due to be made by the Borrowers under any of the
Security Documents, the amount received by the Agent from the Borrowers falls
short of the total amount of the payment due to be made by the Borrowers on such
date then, without prejudice to any rights or remedies available to the
Creditors or any of them under the Security Documents, the Agent shall apply the
amount actually received from the Borrowers in or towards discharge of the
obligations of the Borrowers under the Security Documents in the following
order, notwithstanding any appropriation made, or purported to be made, by the
Borrowers:

     

    
      	
              6.9.1

            	
              firstly,
      in or towards payment, on a pro rata basis, of any unpaid costs and
      expenses of the Agent and the Security Agent under, or in relation to, the
      Security Documents;

            

    

     

    
      	
              6.9.2

            	
              secondly,
      in or towards payment of any fees payable to the Agent or any other
      Creditor under, or in relation to, the Security Documents which remain
      unpaid;

            

    

     

    
      	
              6.9.3

            	
              thirdly,
      in or towards payment to the Banks, on a pro rata basis, of any accrued
      interest which shall have become due under any of the Security Documents
      but remains unpaid;

            

    

     

    
      	
              6.9.4

            	
              fourthly,
      in or towards payment to the Banks, on a pro rata basis, of any principal
      in respect of the Loan which shall have become due but remains unpaid;
      

            

    

     

    
      	
              6.9.5

            	
              fifthly,
      in or towards payment to any Bank for any loss suffered by reason of any
      payment in respect of principal not being effected on an Interest Payment
      Date relating to the part of the Loan repaid and which amounts are so
      payable under this Agreement;

            

    

     

    
      	
              6.9.6

            	
              sixthly,
      in or towards payment to the Swap Provider of any amounts owing to it
      under the Master Swap Agreement;
and

            

    

     

    
      	
              6.9.7

            	
              seventhly,
      in or towards payment to the relevant person of any other sum which shall
      have become due under any of the Security Documents but remains unpaid
      (and, if more than one such sum so remains unpaid, on a pro rata
      basis).

            

    

     

    The
order of application set out in this clause 6.9.3 to 6.9.7 may be varied by
the Agent if the Majority Banks so direct, without any reference to, or consent
or approval from, the Borrowers.

     

    
      	
              7

            	
              Representations
      and warranties

            

    

     

    
      	
              7.1

            	
              Continuing
      representations and warranties

            

    

     

    The
Borrowers jointly and severally represent and warrant to each Creditor
that:

     

    
      	
              7.1.1

            	
              Due
      incorporation

            

    

     

    the
Borrowers and each of the other Security Parties are duly incorporated and
validly existing in good standing under the laws of their respective countries
of incorporation as limited liabilities companies or (as the case may be)
corporations, and have power to carry on their respective businesses as they are
now being conducted and to own their respective property and other
assets;

     

    
      
         

      

      
        23

        
          

        

      

      
         

      

    

    
 

     

    
      	
              7.1.2

            	
              Corporate
      power

            

    

     

    each of
the Borrowers has power to execute, deliver and perform its obligations under
the Underlying Documents and the Borrowers' Security Documents to which it is or
is to be a party and to borrow the Total Commitment and each of the other
Security Parties has power to execute and deliver and perform its obligations
under the Security Documents and the Underlying Documents to which it is or is
to be a party; all necessary corporate, shareholder and other action has been
taken to authorise the execution, delivery and performance of the same and no
limitation on the powers of either Borrower to borrow will be exceeded as a
result of borrowing the Loan;

     

    
      	
              7.1.3

            	
              Binding
      obligations

            

    

     

    the
Security Documents constitute or will, when executed, constitute valid and
legally binding obligations of the relevant Security Parties enforceable in
accordance with their respective terms;

     

    
      	
              7.1.4

            	
              No
      conflict with other obligations

            

    

     

    the
execution and delivery of, the performance of their obligations under, and
compliance with the provisions of, the Underlying Documents and the Security
Documents by the relevant Security Parties will not (i) contravene any existing
applicable law, statute, rule or regulation or any judgment, decree or permit to
which either of the Borrowers or any other Security Party is subject, (ii)
conflict with, or result in any breach of any of the terms of, or constitute a
default under, any agreement or other instrument to which either of the
Borrowers or any other Security Party is a party or is subject or by which it or
any of its property is bound, (iii) contravene or conflict with any provision of
the constitutional documents of either of the Borrowers or any other Security
Party or (iv) result in the creation or imposition of or oblige either of the
Borrowers or any other member of the Group or any other Security Party to create
any Encumbrance (other than a Permitted Encumbrance) on any of the undertakings,
assets, rights or revenues of either of the Borrowers or any other member of the
Group or any other Security Party;

     

    
      	
              7.1.5

            	
              No
      litigation

            

    

     

    no
litigation, arbitration or administrative proceeding is taking place, pending
or, to the knowledge of the officers of either of the Borrowers, threatened
against either of the Borrowers or any other member of the Group or any other
Security Party which could have a material adverse effect on the business,
assets, management prospects, performance, operations, results of operations,
properties or the condition (financial or otherwise) of either of the Borrowers
or any other member of the Group or any other Security Party or the Group as a
whole;

     

    
      	
              7.1.6

            	
              No
      filings required

            

    

     

    save
for the registration of the Mortgages under the laws of the Flag State through
the Registry, it is not necessary to ensure the legality, validity,
enforceability or admissibility in evidence of any of the Underlying Documents
or the Security Documents that they or any other instrument be notarised, filed,
recorded, registered or enrolled in any court, public office or elsewhere in any
Relevant Jurisdiction or that any stamp, registration or similar tax or charge
be paid in any Relevant Jurisdiction on or in relation to any of the Underlying
Documents or the Security Documents and each of the Underlying Documents and the
Security Documents is in proper form for its enforcement in the courts of each
Relevant Jurisdiction;

     

    
      
         

      

      
        24

        
          

        

      

      
         

      

    

    
 

     

    
      	
              7.1.7

            	
              Choice
      of law

            

    

     

    the
choice of English law to govern the Underlying Documents and the Security
Documents (other than the Mortgages) and the choice of Maltese law to govern the
Mortgages, and the submissions by the Security Parties therein to the
non-exclusive jurisdiction of the English courts are valid and
binding;

     

    
      	
              7.1.8

            	
              No
      immunity

            

    

     

    neither
of the Borrowers nor any other Security Party nor any of their respective assets
is entitled to immunity on the grounds of sovereignty or otherwise from any
legal action or proceeding (which shall include, without limitation, suit,
attachment prior to judgement, execution or other enforcement);

     

    
      	
              7.1.9

            	
              Consents
      obtained

            

    

     

    every
consent, authorisation, licence or approval of, or registration with or
declaration to, governmental or public bodies or authorities or courts required
by any Security Party to authorise, or required by any Security Party in
connection with, the execution, delivery, validity, enforceability or
admissibility in evidence of each of the Underlying Documents and each of the
Security Documents to which it is a party or the performance by each Security
Party of its obligations under the Security Documents to which it is a party,
respectively, has been obtained or made and is in full force and effect and
there has been no default in the observance of any of the conditions or
restrictions (if any) imposed in, or in connection with, any of the
same;

     

    
      	
              7.1.10

            	
              Financial
      statements correct and complete

            

    

     

    the
unaudited consolidated financial statements of the Group in respect of the
financial half-year ended on 30 September 2007 as delivered to the Agent, have
been prepared in accordance with the Applicable Accounting Principles which have
been consistently applied and present fairly and accurately the consolidated
financial position of the Group as at the date they were prepared and the
consolidated results of the operations of the Group for the financial period
ended on such date and, as at such date no member of the Group had any
significant liabilities (contingent or otherwise) or any unrealised or
anticipated losses which are not disclosed by, or reserved against or provided
for in, such financial statements;

     

    
      	
              7.1.11

            	
              Compliance
      with laws and regulations

            

    

     

    each of
the Borrowers is in compliance with the terms and conditions of all laws,
regulations, agreements, licences and concessions material to the carrying on of
its business (including in relation to Taxation); and

     

    
      	
              7.1.12

            	
              No
      material adverse change

            

    

     

    there
has been no material adverse change in the business, management, assets,
operations, results of operations, properties, performance, prospects or the
condition (financial or otherwise) of any of the Borrowers or the Manager or the
Corporate Guarantor or the Group as a whole from that existing on the date of
this Agreement as described by or on behalf of the Borrowers and/or any other
Security Party to the Agent and/or the Arranger in the negotiation of this
Agreement.

     

    
      
         

      

      
        25

        
          

        

      

      
         

      

    

    
 

     

    
      	
              7.2

            	
              Initial
      representations and warranties

            

    

     

    The
Borrowers jointly and severally further represent and warrant to each Creditor
that:

     

    
      	
              7.2.1

            	
              Pari
      passu

            

    

     

    the
obligations of each Borrower under this Agreement are direct, general and
unconditional obligations of such Borrower and rank at least pari passu with all
other present and future unsecured and unsubordinated Indebtedness of such
Borrower with the exception of any obligations which are mandatorily preferred
by law and not by contract;

     

    
      	
              7.2.2

            	
              No
      default under other Indebtedness

            

    

     

    neither
of the Borrowers nor any other member of the Group nor any other Security Party
is (nor would with the giving of notice or lapse of time or the satisfaction of
any other condition or combination thereof be) in breach of or in default under
any agreement relating to Indebtedness to which it is a party or by which it may
be bound;

     

    
      	
              7.2.3

            	
              Information

            

    

     

    the
information, exhibits and reports furnished by any Security Party to the Agent
and/or the Arranger in connection with the negotiation and preparation of the
Security Documents are true and accurate in all material respects and not
misleading, do not omit material facts and all reasonable enquiries have been
made to verify the facts and statements contained therein; there are no other
facts the omission of which would make any fact or statement therein
misleading;

     

    
      	
              7.2.4

            	
              No
      withholding Taxes

            

    

     

    no
Taxes are imposed by withholding or otherwise on any payment to be made by any
Security Party under the Underlying Documents or the Security Documents or are
imposed on or by virtue of the execution or delivery by the Security Parties of
the Underlying Documents or the Security Documents or any other document or
instrument to be executed or delivered under any of the Security
Documents;

     

    
      	
              7.2.5

            	
              No
      Default

            

    

     

    no
Default has occurred and is continuing;

     

    
      	
              7.2.6

            	
              The
      Ships

            

    

     

    each
Ship will, on the Drawdown Date of the Advance relevant to such Ship,
be:

     

    
      	
               
      

            	
              (a)

            	
              in
      the absolute ownership of the relevant Borrower who will, on and after
      such Drawdown Date, be the sole, legal and beneficial owner of such
      Ship;

            

    

     

    
      	
               
      

            	
              (b)

            	
              permanently
      registered through the Registry as a ship under the laws and flag of the
      relevant Flag State;

            

    

     

    
      	
               
      

            	
              (c)

            	
              operationally
      seaworthy and in every way fit for service;
and

            

    

     

    
      	
               
      

            	
              (d)

            	
              classed
      with the relevant Classification free of all requirements and
      recommendations of the relevant Classification
  Society;

            

    

     

    
      
         

      

      
        26

        
          

        

      

      
         

      

    

    
 

     

    
      	
              7.2.7

            	
              Ships'
      employment

            

    

     

    neither
Ship is nor will, on or before the Drawdown Date of the Advance relevant to such
Ship, be subject to any charter or contract or to any agreement to enter into
any charter or contract which, if entered into after the date of the relevant
Ship Security Documents, would have required the consent of the Agent or, as the
context may require, the Security Agent and on or before the Drawdown Date of
the Advance relevant to such Ship, there will not be any agreement or
arrangement whereby the Earnings (as defined in the Deed of Covenant for such
Ship) of such Ship may be shared with any other person;

     

    
      	
              7.2.8

            	
              Freedom
      from Encumbrances

            

    

     

    neither
of the Ships, nor its Earnings, Insurances or Requisition Compensation (each as
defined in the relevant Ship Security Documents) nor the Operating Account for
such Ship nor any other properties or rights which are, or are to be, the
subject of any of the Security Documents nor any part thereof will be, on the
Drawdown Date of the Advance relevant to such Ship, subject to any
Encumbrance;

     

    
      	
              7.2.9

            	
              Compliance
      with Environmental Laws and
Approvals

            

    

     

    except
as may already have been disclosed by the Borrowers in writing to, and
acknowledged in writing by, the Agent:

     

    
      	
               
      

            	
              (a)

            	
              the
      Borrowers and the other Relevant Parties and, to the best of the
      Borrowers' knowledge and belief (having made due enquiry), their
      respective Environmental Affiliates have complied with the provisions of
      all Environmental Laws;

            

    

     

    
      	
               
      

            	
              (b)

            	
              the
      Borrowers and the other Relevant Parties and, to the best of the
      Borrowers' knowledge and belief (having made due enquiry), their
      respective Environmental Affiliates have obtained all Environmental
      Approvals and are in compliance with all such Environmental Approvals;
      and

            

    

     

    
      	
               
      

            	
              (c)

            	
              neither
      the Borrowers nor any other Relevant Party nor, to the best of the
      Borrowers' knowledge and belief (having made due enquiry), any of their
      respective Environmental Affiliates have received notice of any
      Environmental Claim that the Borrowers or any other Relevant Party or any
      such Environmental Affiliate is not in compliance with any Environmental
      Law or any Environmental Approval;

            

    

     

    
      	
              7.2.10

            	
              No
      Environmental Claims

            

    

     

    except
as may already have been disclosed by the Borrowers in writing to, and
acknowledged in writing by, the Agent, there is no Environmental Claim pending
or, to the best of the Borrowers' knowledge and belief, threatened against the
Borrowers or either of the Ships or any other Relevant Party or any other
Relevant Ship or, to the best of the Borrowers' knowledge and belief (having
made due enquiry), any of their respective Environmental
Affiliates;

     

    
      	
              7.2.11

            	
              No
      potential Environmental Claims

            

    

     

    except
as may already have been disclosed by the Borrowers in writing to, and
acknowledged in writing by, the Agent, there has been no emission, spill,
release or discharge of a Pollutant from either of the Ships or any other
Relevant Ship owned by, managed or crewed by or chartered to the Borrowers nor,
to the best of the Borrowers' knowledge and belief (having made due enquiry),
from any Relevant Ship owned by, managed or crewed by or chartered to any other
Relevant Party which could give rise to an Environmental Claim;

     

    
      
         

      

      
        27

        
          

        

      

      
         

      

    

    
 

     

    
      	
              7.2.12

            	
              Copies
      true and complete

            

    

     

    the copies of
the Underlying Documents delivered or to be delivered to the Agent pursuant to
clause 9.1 are or will, when delivered, be true and complete copies of such
documents; such documents constitute valid and binding obligations of the
parties thereto enforceable in accordance with their terms and there have been
no amendments or variations thereof or defaults thereunder;
and

     

    
      	
              7.2.13

            	
              Shareholdings

            

    

     

    
      	
               
      

            	
              (a)

            	
              each
      of the Borrowers is a wholly-owned direct Subsidiary of the Corporate
      Guarantor and all of the issued shares in the Manager are legally and
      ultimately beneficially owned by the person or persons disclosed by or on
      behalf of the Borrowers or any other Security Party to the Agent and/or
      the Arranger in the negotiation of this
  Agreement;

            

    

     

    
      	
               
      

            	
              (b)

            	
              no
      less than 30% of the total issued voting share capital of the Corporate
      Guarantor is ultimately beneficially owned by Mr George Economou and/or
      family trusts and/or foundations of which Mr George Economou is a
      beneficiary; and

            

    

     

    
      	
               
      

            	
              (c)

            	
              no
      person or persons acting in concert (other than Mr George Economou and/or
      family trusts or foundations of Mr George Economou) are the ultimate
      beneficial owners of more than 50% of the total issued voting share
      capital of the Corporate Guarantor or have the control of the Corporate
      Guarantor or of its board of directors (and “control” shall have the
      meaning given to it in the definition of “Subsidiary” in clause
      1.2).

            

    

     

    
      	
              7.3

            	
              Repetition
      of representations and warranties

            

    

     

    On and as of
each Drawdown Date and (except in relation to the representations and warranties
in clause 7.2) on each Interest Payment Date, the Borrowers shall (a) be
deemed to repeat the representations and warranties in clauses 7.1 and 7.2 as if made
with reference to the facts and circumstances existing on such day and (b) be
deemed to further represent and warrant to each of the Creditors that the then
latest financial statements delivered to the Agent by the Borrowers (if any)
under clause 8.1.5 have been prepared in accordance with the Applicable
Accounting Principles which have been consistently applied and present fairly
and accurately the consolidated financial position of the Group, as at the end
of the financial period to which the same relate and the consolidated results of
the operations of the Group, for the financial period to which the same relate
and, as at the end of such financial period, neither the Corporate Guarantor nor
any other member of the Group had any significant liabilities (contingent or
otherwise) or any unrealised or anticipated losses which are not disclosed by,
or reserved against or provided for in, such financial
statements.

     

    
      	
              8

            	
              Undertakings

            

    

     

    
      	
              8.1

            	
              General

            

    

     

    The
Borrowers jointly and severally undertake with each Creditor that, from the date
of this Agreement and so long as any moneys are owing under any of the Security
Documents and while all or any part of the Total Commitment remains outstanding,
they will:

     

    
      	
              8.1.1

            	
              Notice
      of Default

            

    

     

    promptly
inform the Agent of any occurrence of which either of them becomes aware which
might adversely affect the ability of any Security Party to perform its
obligations under any of the Security Documents and, without limiting the
generality of the foregoing, will inform the Agent of any Default forthwith upon
becoming aware thereof and will from time to time, if so requested by the Agent,
confirm to the Agent in writing that, save as otherwise stated in such
confirmation, no Default has occurred and is continuing;

     

    
      
         

      

      
        28

        
          

        

      

      
         

      

    

    
 

     

    
      	
              
                8.1.2

              

            	
               

            	
              Consents
      and licences

            

    

     

    without
prejudice to clauses 7.1 and 9, obtain or cause to be obtained, maintain in full force and effect and
comply in all material respects with the conditions and restrictions (if any)
imposed in, or in connection with, every consent, authorisation, licence or
approval of governmental or public bodies or authorities or courts and do, or
cause to be done, all other acts and things which may from time to time be
necessary or desirable under applicable law for the continued due performance of
all the obligations of the Security Parties under each of the Security
Documents;

     

    
      	
              8.1.3

            	
              Use
      of proceeds

            

    

     

    use the Loan
or, as the case may be, the Advances for their benefit and under their full
responsibility and exclusively for the purposes specified in clauses
1.1 and
2.5;

     

    
      	
              8.1.4

            	
              Pari
      passu and subordination

            

    

     

    
      	
               
      

            	
              (a)

            	
              ensure
      that their obligations under this Agreement shall, without prejudice to
      the provisions of clause 8.3 and the security intended to be created by
      the Security Documents, at all times rank at least pari passu with all
      their other present and future unsecured and unsubordinated Indebtedness
      with the exception of any obligations which are mandatorily preferred by
      law and not by contract; and

            

    

     

    
      	
               
      

            	
              (b)

            	
              ensure
      that the obligations (if any) of the Borrowers to repay any loan advanced
      to them by their shareholders or any other member of the Group are at all
      times fully subordinated towards their obligations to the Creditors under
      this Agreement and the other Security Documents and that any such loans or
      advances are and remain at all times on terms and conditions acceptable to
      the Banks in all respects;

            

    

     

    
      	
              8.1.5

            	
              Financial
      statements and valuations

            

    

     

    
      	
               
      

            	
              (a)

            	
              prepare
      or cause to be prepared consolidated financial statements of the Group in
      accordance with the Applicable Accounting Principles consistently applied
      in respect of each financial year (but commencing with the financial year
      ending 31 December 2007) and cause the same to be reported on by their
      auditors and prepare unaudited consolidated financial statements of the
      Group on the same basis as the annual statements in respect of each
      financial quarter (including on a year to date basis) period (but
      commencing with the financial quarter period ending 30 September 2007) and
      deliver as many copies of the same as the Agent may reasonably require as
      soon as practicable but not later than one hundred and eighty (180) days
      (in the case of audited financial statements) or ninety (90) days (in the
      case of unaudited financial statements) after the end of the financial
      period to which they relate;

            

    

     

    
      	
               
      

            	
              (b)

            	
              deliver
      or cause to be delivered to the Agent a valuation (dated not earlier than
      30 days previously) of each Fleet Vessel (as defined in the Corporate
      Guarantee) prepared in accordance with, and in the manner specified in,
      clause 8.2.2 (at the expense of the Borrowers) at the time when any
      audited annual and unaudited nine-monthly consolidated financial
      statements of the Group are delivered to the Agent in accordance with
      clause 8.1.5(a) and clause 5.1 of the Corporate Guarantee;
    and

            

    

     

    
      	
               
      

            	
              (c)

            	
              deliver
      to the Agent in sufficient copies for all the Banks, a Compliance
      Certificate for the relevant period executed by the Corporate Guarantor
      and counter-signed by the Chief Financial Officer or an authorised
      Director or other Officer of the Corporate Guarantor at the time when any
      unaudited or audited consolidated financial statements of the Group
      delivered to the Agent in accordance with clause 8.1.5(a) and clause 5.1
      of the Corporate Guarantee;

            

    

     

    
      
         

      

      
        29

        
          

        

      

      
         

      

    

    
 

     

    
      	
              8.1.6

            	
              Delivery
      of reports

            

    

     

    deliver
to the Agent sufficient copies for all the Banks of every report, circular,
notice or like document issued by the Borrowers or any member of the Group to
its shareholders or creditors generally, at the same time if is issued or
given;

     

    
      	
              8.1.7

            	
              Provision
      of further information

            

    

     

    provide
the Agent with such financial and other information concerning the Borrowers,
the other Security Parties, any other member of the Group, the Group as a whole
and their respective affairs as the Agent may from time to time reasonably
require, including, without limitation, regarding their financial standing,
commitments, operations, vessel sales or purchases, any new borrowings, any
material litigation, arbitration and administrative proceedings and all major
financial developments in relation to each Security Party, any other member of
the Group and the Group as a whole;

     

    
      	
              8.1.8

            	
              Know
      your customer information

            

    

     

    deliver
to the Agent such documents and evidence as the Agent shall from time to time
require relating to the verification of identity and knowledge of the Agent’s or
any Bank’s or the  Swap Provider’s customers and the compliance by the
Agent or any Bank or the Swap Provider with all necessary “know your customer”
or similar checks, always on the basis of applicable laws and regulations or the
Agent's or any Bank’s or any Swap Provider’s own internal guidelines, in each
case as such laws, regulations or internal guidelines apply from time to
time;

     

    
      	
              8.1.9

            	
              Obligations
      under Security Documents

            

    

     

    and
will procure that each of the other Security Parties will, duly and punctually
perform each of the obligations expressed to be assumed by them under the
Security Documents;

     

    
      	
              8.1.10

            	
              Compliance
      with Code

            

    

     

    and
will procure that the Manager or any Operator will, comply with and ensure that
each Ship and the Manager or any Operator at all times complies with the
requirements of the Code, including (but not limited to) the maintenance and
renewal of valid certificates pursuant thereto throughout the Security Period
(as defined in the Deeds of Covenant) and will procure that each member of the
Group and each vessel thereof complies with the requirements of the
Code;

     

    
      	
              8.1.11

            	
              Withdrawal
      of DOC and SMC

            

    

     

    and
will procure that the Manager or any Operator will, immediately inform the Agent
if there is any threatened or actual withdrawal of its Operator’s DOC or the SMC
in respect of any Ship;

     

    
      	
              8.1.12

            	
              Issuance
      of DOC and SMC

            

    

     

    and
will procure that the Manager or any Operator will, promptly inform the Agent
upon the issue to either of the Borrowers, the Manager or any Operator of a DOC
and to each Ship of an SMC or the receipt by either of the Borrowers, the
Manager or any Operator of notification that its application for the same has
been refused;

     

    
      	
              8.1.13

            	
              ISPS
      Code Compliance

            

    

     

    and
will procure that the Manager or any Operator will:

     

    
      
        	
                 
      

              	
                (a)

              	
                maintain
      at all times a valid and current ISSC respect of each
  Ship;

              

      

       

    

     

    
      
         

      

      
        30

        
          

        

      

      
         

      

    

    
 

     

    
      	
               
      

            	
              (b)

            	
              immediately
      notify the Agent in writing of any actual or threatened withdrawal,
      suspension, cancellation or modification of the ISSC in respect of each
      Ship; and

            

    

     

    
      	
               
      

            	
              (c)

            	
              procure
      that each Ship and any other vessel of the Group will comply at all times
      with the ISPS Code;

            

    

     

    
      	
              8.1.14

            	
              Charters

            

    

     

    advise
the Agent promptly of any charter of either Ship having a term of twelve (12)
months or more (including any options to extend or renew) and (i) forthwith
after its execution deliver a certified copy of each such charter to the Agent,
(ii) forthwith following demand by the Agent execute a specific assignment (in
such form as the Agent may require) of any such charter in favour of the
Security Agent and any notice of assignment required in connection therewith and
promptly procure the service of any such notice of assignment on the relevant
charterer and the acknowledgement of such notice by the relevant charterer and
(iii) pay all legal and other costs incurred by the Agent or any other Creditor
in connection with any such specific charter assignments; and

     

    
      	
              8.1.15

            	
              Intra-Group
      transactions

            

    

     

    ensure
that any transactions, agreements or other arrangements (if any) entered into by
it with any members of the Group, are entered into on an arm’s length basis and
for full value and consideration.

     

    
      	
              8.2

            	
              Security
      value maintenance

            

    

     

    
      	
              8.2.1

            	
              Security
      shortfall

            

    

     

    If at
any time the Security Value shall be equal to or less than the Security
Requirement, the Agent (acting on the instructions of the Majority Banks) shall
give notice to the Borrowers requiring that such deficiency be remedied and then
the Borrowers shall either:

     

    
      	
               
      

            	
              (a)

            	
              prepay
      within a period of ten (10) days of the date of receipt by the Borrowers
      of the Agent's said notice, such sum in Dollars as will result in the
      Security Requirement after such prepayment (taking into account any other
      repayment made between the date of the notice and the date of such
      prepayment) being higher than the Security Value;
  or

            

    

     

    
      	
               
      

            	
              (b)

            	
              within
      ten (10) days of the date of receipt by the Borrowers of the Agent's said
      notice constitute to the satisfaction of the Agent such further security
      for the Loan as shall be acceptable to the Banks, having a value for
      security purposes (as determined by the Agent in its absolute discretion)
      at the date upon which such further security shall be constituted which,
      when added to the Security Value, shall not be higher than the Security
      Requirement as at such date.

            

    

     

    The provisions
of clause 4.4 and any relevant provisions of clause 4.5 shall apply to
prepayments made under clause 8.2.1(a).

     

    
      	
              8.2.2

            	
              Valuation
      of Mortgaged Ships

            

    

     

    Each of
the Mortgaged Ships shall, for the purposes of this Agreement, be valued in
Dollars as and when the Agent (acting on instructions of the Majority Banks)
shall require by one of the Approved Shipbrokers nominated by the Borrowers (or,
failing this, by the Agent) and appointed by the Agent and the Borrowers. Each
such valuation shall be addressed to the Agent and made without, unless required
by the Agent, physical inspection and on the basis of a sale for prompt delivery
for cash at arm’s length on normal commercial terms as between a willing buyer
and a willing seller without taking into account the benefit of any charterparty
or other engagement concerning such Mortgaged Ship. Such valuation shall
constitute the value of such Mortgaged Ship for the purposes of this clause
8.2.

     

    
      
         

      

      
        31

        
          

        

      

      
         

      

    

     

     

    The
value of each Mortgaged Ship determined in accordance with the provisions of
this clause 8.2 shall be binding upon the parties hereto until such time as
any such further valuation shall be obtained.

     

    
      	
              8.2.3
      

            	
               

            	
              Information

            

    

     

    The
Borrowers jointly and severally undertake with each Creditor to supply to the
Agent and to any such Approved Shipbrokers such information concerning each
Mortgaged Ship and its condition as such Approved Shipbroker may require for the
purpose of making any such valuation.

     

    
      	
              
                8.2.4

              

            	
               

            	
              Costs

            

    

     

    All costs in
connection with the Agent obtaining any valuation of the Mortgaged Ships
referred to in clause 8.2.2, any valuation of the Fleet Vessels referred to
in clause 8.1.5(b), the valuations of the Ships referred to in schedule 3, and
any valuation either of any additional security for the purposes of ascertaining
the Security Value at any time or necessitated by the Borrowers electing to
constitute additional security pursuant to clause 8.2.1(b), shall be borne by the
Borrowers.

     

    
      	
              8.2.5

            	
              Valuation
      of additional security

            

    

     

    For the
purpose of this clause 8.2, the market value of any additional security
provided or to be provided to the Security Agent shall be determined by the
Agent in its absolute discretion without any necessity for the Agent assigning
any reason thereto.

     

    
      	
              8.2.6

            	
              Documents
      and evidence

            

    

     

    In
connection with any additional security provided in accordance with this
clause 8.2, the Agent shall be entitled to receive such evidence and
documents of the kind referred to in schedule 3 as may in the Agent's
opinion be appropriate and such favourable legal opinions as the Agent shall in
its absolute discretion require.

     

    
      	
              8.3

            	
              Negative
      undertakings

            

    

     

    The
Borrowers jointly and severally undertake with each Creditor that, from the date
of this Agreement and so long as any moneys are owing under the Security
Documents and while all or any part of the Total Commitment remains outstanding,
the Borrowers will not, without the prior written consent of the
Agent:

     

    
      	
              8.3.1

            	
              Negative
      pledge

            

    

     

    permit
any Encumbrance (other than a Permitted Encumbrance) to subsist, arise or be
created or extended over all or any part of their present or future
undertakings, assets, rights or revenues to secure or prefer any present or
future Indebtedness or other liability or obligation of any Security Party
(other than the Corporate Guarantor) or any other person;

     

    
      	
              8.3.2

            	
              No
      merger

            

    

     

    merge
or consolidate with any other person or enter into any demerger, amalgamation or
corporate reconstruction or redomiciliation of any type;

     

    
      
         

      

      
        32

        
          

        

      

      
         

      

    

     

     

    
      	
              
                8.3.3

              

            	
               

            	
              Disposals

            

    

     

    sell,
transfer, abandon, lend or otherwise dispose of or cease to exercise direct
control over any part (being, either alone or when aggregated with all other
disposals falling to be taken into account pursuant to this clause 8.3.3,
material in the opinion of the Agent in relation to their respective
undertakings, assets, rights and revenues taken as a whole) of their respective
present or future undertakings, assets, rights or revenues (otherwise than by
transfers, sales or disposals for full consideration in the ordinary course of
trading but in any event exclusively the Ships) whether by one or a series of
transactions related or not;

     

    
      	
              8.3.4
      

            	
               

            	
              Other
      business

            

    

     

    undertake
any business other than the ownership, chartering and operation of the Ships and
the chartering of the Ships to third parties;

     

    
      	
              
                8.3.5

              

            	
               

            	
              Acquisitions

            

    

     

    acquire
any further assets other than the Ships and rights arising under contracts
entered into by or on behalf of the Borrowers in the ordinary course of their
businesses of owning, operating and chartering the Ships;

     

    
      	
              8.3.6

            	
              Other
      obligations

            

    

     

    incur
any obligations except for obligations arising under the Underlying Documents or
the Security Documents or contracts entered into in the ordinary course of their
business of owning, operating and chartering the Ships;

     

    
      	
              8.3.7

            	
              No
      borrowing

            

    

     

    incur
any Borrowed Money except for Borrowed Money pursuant to the Security
Documents;

     

    
      	
              8.3.8

            	
              Repayment
      of borrowings

            

    

     

    repay
or prepay the principal of, or pay interest on or any other sum in connection
with, any of their Borrowed Money except for Borrowed Money pursuant to the
Security Documents;

     

    
      	
              8.3.9

            	
              Guarantees

            

    

     

    issue
any guarantees or indemnities or otherwise become directly or contingently
liable for the obligations of any person, firm, or corporation except pursuant
to the Security Documents and except for guarantees or indemnities from time to
time required in the ordinary course by any protection and indemnity or war
risks association with which a Ship is entered, guarantees required to procure
the release of a Ship from any arrest, detention, attachment or levy or
guarantees or undertakings required for the salvage of a Ship;

     

    
      	
              8.3.10

            	
              Loans

            

    

     

    make
any loans or grant any credit (save for normal trade credit in the ordinary
course of business) to any person or agree to do so;

     

    
      	
              8.3.11

            	
              Sureties

            

    

     

    permit
any Indebtedness of either Borrower to any person (other than the Creditors) to
be guaranteed by any person (save for guarantees or indemnities from time to
time required in the ordinary course by any protection and indemnity or war
risks association with which a Ship is entered, guarantees required to procure
the release of a Ship from any arrest, detention, attachment or levy or
guarantees or undertakings required for the salvage of a Ship);

     

    
      
         

      

      
        33

        
          

        

      

      
         

      

    

    
 

     

    
      	
              8.3.12

            	
              Share
      capital and distribution

            

    

     

    purchase
or otherwise acquire for value any shares of their capital or declare or pay any
dividends or distribute any of their present or future assets, undertakings,
rights or revenues to any of their shareholders Provided
however that each Borrower may declare or pay dividends to the Corporate
Guarantor, if no Event of Default has occurred and is continuing at the time of
declaration or payment of such dividends or would occur as a result
thereof;

     

    
      	
              8.3.13

            	
              Change
      of management of a Ship

            

    

     

    appoint
any person to carry out the commercial and technical management of the Ship
other than the Manager or terminate a Management Agreement or vary or amend the
terms thereof;

     

    
      	
              8.3.14

            	
              Designated
      Transactions

            

    

     

    enter
into any derivative transactions other than Designated Transactions;
or

     

    
      	
              8.3.15

            	
              Subsidiaries

            

    

     

    form or
acquire any Subsidiaries; or

     

    
      	
              8.3.16

            	
              Financial
      year, auditors and constitutional
documents

            

    

     

    
      	
               
      

            	
              (a)

            	
              change,
      cause, permit or agree to any change in, the way of computation of their
      financial year;

            

    

     

    
      	
               
      

            	
              (b)

            	
              change,
      permit or agree to any change of, their auditors from those existing on
      the date of this Agreement; or

            

    

     

    
      	
               
      

            	
              (c)

            	
              change,
      amend or vary, or agree to or permit any change, amendment or variation of
      or to, their constitutional
documents.

            

    

     

    
      	
              9

            	
              Conditions

            

    

     

    
      	
              9.1

            	
              Documents
      and evidence

            

    

     

    The
obligation of each Bank to make its Commitment available shall be subject to the
condition that:

     

    
      	
              9.1.1

            	
              the
      Agent, or its duly authorised representative, shall have received, not
      later than the day on which the Drawdown Notice for the first Advance is
      given, the documents and evidence specified in Part 1 of schedule 3
      in form and substance satisfactory to the Agent;
  and

            

    

     

    
      	
              9.1.2

            	
              the
      Agent, or its duly authorised representative, shall have received, on or
      prior to the drawdown of each Advance, the documents and evidence
      specified in Part 2 of schedule 3 in respect of such Advance and the
      Ship relevant to it, in form and substance satisfactory to the
      Agent.

            

    

     

    
      	
              9.2

            	
              General
      conditions precedent

            

    

     

    The
obligation of each Bank to contribute to either Advance shall be subject to the
further conditions that, at the time of the giving of the Drawdown Notice for
such Advance, and at the time of the making of such Advance:

     

    
      	
              9.2.1

            	
              the
      representations and warranties contained in (a) clauses 7.1, 7.2 and 7.3(b) and
      (b) clause 4 of the Corporate Guarantee, are true and correct on and as of
      each such time as if each was made with respect to the facts and
      circumstances existing at such time;
  and

            

    

     

    
      
         

      

      
        34

        
          

        

      

      
         

      

    

    
 

     

    
      	
              9.2.2

            	
              no
      Default shall have occurred and be continuing or would result from the
      making of such Advance.

            

    

     

    
      	
              9.3

            	
              Waiver
      of conditions precedent

            

    

     

    The conditions
specified in this clause 9 are inserted solely
for the benefit of the Banks and may be waived by the Agent (acting on the
instructions of the Majority Banks) in whole or in part and with or without
conditions.

     

    
      	
              9.4

            	
              Further
      conditions precedent

            

    

     

    Not later than
five (5) Banking Days prior to each Drawdown Date and not later than five (5)
Banking Days prior to each Interest Payment Date, the Agent (acting on the
instructions of the Majority Banks) may request and the Borrowers shall, not
later than two (2) Banking Days prior to such date, deliver to the Agent on such
request further favourable certificates and/or favourable opinions as to any or
all of the matters which are the subject of clauses 7, 8, 9 and 10.

     

    
      	
              10

            	
              Events
      of Default

            

    

     

    
      	
              10.1

            	
              Events

            

    

     

    There
shall be an Event of Default if:

     

    
      	
              10.1.1

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

            

    

     

    
      	
              10.1.2

            	
              Master
      Swap Agreement: (a) an Event of Default or Potential Event of
      Default (in each case as defined in the Master Swap Agreement) has
      occurred and is continuing with the Borrowers or either of them as the
      Defaulting Party (as defined in the Master Swap Agreement) under the
      Master Swap Agreement or (b) an Early Termination Date has occurred or
      been or become capable of being effectively designated under the Master
      Swap Agreement by the Swap Provider or (c) the Master Swap Agreement is
      terminated, cancelled, suspended, rescinded or revoked or otherwise ceases
      to remain in full force and effect for any reason;
      or

            

    

     

    
      	
              10.1.3

            	
              Breach
      of Insurance and certain other obligations: either of the Borrowers
      or, as the context may require, the Manager fails to obtain and/or
      maintain the Insurances (as defined in, and in accordance with the
      requirements of, the Ship Security Documents) for either of the Mortgaged
      Ships or if any insurer in respect of such Insurances cancels such
      Insurances or disclaims liability by reason, in either case, of
      mis-statement in any proposal for such Insurances or for any other failure
      or default on the part of either of the Borrowers or any other person or
      either of the Borrowers commits any breach of or omits to observe any of
      the obligations or undertakings expressed to be assumed by them under
      clauses 8.1.5, 8.2 or 8.3 or the Corporate Guarantor commits any breach or
      fails to observe any of the obligations or undertakings expressed to be
      assured by it under clauses 5.1.4, 5.2 or 5.3 of the Corporate Guarantee;
      or

            

    

     

    
      	
              10.1.4

            	
              Breach
      of other obligations: any Security Party commits any breach of or
      omits to observe any of its obligations or undertakings expressed to be
      assumed by it under any of the Security Documents (other than those
      referred to in clauses 10.1.1 and 10.1.3
      above) and, in respect of any such breach or omission which in the opinion
      of the Agent (following consultation with the Banks) is capable of remedy,
      such action as the Agent (acting on the instructions of the Majority
      Banks) may require shall not have been taken within thirty (30) days of
      the Agent notifying the relevant Security Party of such default and of
      such required action;
or

            

    

     

    
      
         

      

      
        35

        
          

        

      

      
         

      

    

    
 

     

    
      	
              10.1.5

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

            

    

     

    
      	
              10.1.6

            	
              Cross-default:
      any Indebtedness of any Security Party or any other member of the Group is
      not paid when due or any Indebtedness of any Security Party or any other
      member of the Group becomes (whether by declaration or automatically in
      accordance with the relevant agreement or instrument constituting the
      same) due and payable prior to the date when it would otherwise have
      become due (unless as a result of the exercise by the relevant Security
      Party or any other member of the Group of a voluntary right of
      prepayment), or any creditor of any Security Party or any other member of
      the Group becomes entitled to declare any such Indebtedness due and
      payable or any facility or commitment available to any Security Party or
      other member of the Group relating to Indebtedness is withdrawn, suspended
      or cancelled by reason of any default (however described) of the person
      concerned unless the relevant Security Party or any other member of the
      Group shall have satisfied the Agent that such withdrawal, suspension or
      cancellation will not affect or prejudice in any way the ability of the
      relevant Security Party or of the relevant member of the Group to pay its
      debts as they fall due and fund its commitments, or any guarantee given by
      any Security Party or any other member of the Group in respect of
      Indebtedness is not honoured when due and called upon and, in the case of
      the Corporate Guarantor only and/or any other member of the Group which is
      not a Security Party, the amount or aggregate amount at any one time of
      all Indebtedness of the Corporate Guarantor and/or such other member of
      the Group, in relation to which any of the foregoing events shall have
      occurred is equal to or greater than Three million Dollars ($3,000,000) or
      its equivalent in the currency in which same is denominated and payable;
      or

            

    

     

    
      	
              10.1.7

            	
              Legal
      process: any judgment or order made against any Security Party or
      other member of the Group is not stayed or complied with within fifteen
      (15) days or a creditor attaches or takes possession of, or a distress,
      execution, sequestration or other process is levied or enforced upon or
      sued out against, any of the undertakings, assets, rights or revenues of
      any Security Party or other member of the Group and is not discharged
      within fifteen (15) days;
or

            

    

     

    
      	
              10.1.8

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

            

    

     

    
      	
              10.1.9

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

            

    

     

    
      	
              10.1.10

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

            

    

     

    
      	
              10.1.11

            	
              Administration:
      any petition is presented, notice given or other step is taken for the
      purpose of the appointment of an administrator of any Security Party or
      other member of the Group or the Agent believes that any such petition or
      other step is imminent or an administration order is made in relation to
      any Security Party or other member of the Group;
      or

            

    

     

    
      	
              10.1.12

            	
              Appointment
      of receivers and managers: any administrative or other receiver is
      appointed of any Security Party or other member of the Group or any part
      of its assets and/or undertaking or any other steps are taken to enforce
      any Encumbrance over all or any part of the assets of any Security Party
      or other member of the Group;
or

            

    

     

    
      
         

      

      
        36

        
          

        

      

      
         

      

    

    
 

     

    
      	
              10.1.13

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

            

    

     

    
      	
              10.1.14

            	
              Analogous
      proceedings: there occurs, in relation to any Security Party or
      other member of the Group, in any country or territory in which any of
      them carries on business or to the jurisdiction of whose courts any part
      of their assets is subject, any event which, in the reasonable opinion of
      the Agent, appears in that country or territory to correspond with, or
      have an effect equivalent or similar to, any of those mentioned in
      clauses 10.1.7 to 10.1.13 (inclusive) or any Security Party or other
      member of the Group otherwise becomes subject, in any such country or
      territory, to the operation of any law relating to insolvency, bankruptcy
      or liquidation; or

            

    

     

    
      	
              10.1.15

            	
              Cessation
      of business: any Security Party or any other member of the Group
      suspends or ceases or threatens to suspend or cease to carry on its
      business; or

            

    

     

    
      	
              10.1.16

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

            

    

     

    
      	
              10.1.17

            	
              Invalidity:
      any of the Security Documents shall at any time and for any reason become
      invalid or unenforceable or otherwise cease to remain in full force and
      effect, or if the validity or enforceability of any of the Security
      Documents shall at any time and for any reason be contested by any
      Security Party which is a party thereto, or if any such Security Party
      shall deny that it has any, or any further, liability thereunder;
      or

            

    

     

    
      	
              10.1.18

            	
              Unlawfulness:
      it becomes impossible or unlawful at any time for any Security Party, to
      fulfil any of the covenants and obligations expressed to be assumed by it
      in any of the Security Documents or for a Creditor to exercise the rights
      or any of them vested in it under any of the Security Documents or
      otherwise; or

            

    

     

    
      	
              10.1.19

            	
              Repudiation:
      any Security Party repudiates any of the Security Documents or does or
      causes or permits to be done any act or thing evidencing an intention to
      repudiate any of the Security Documents;
  or

            

    

     

    
      	
              10.1.20

            	
              Encumbrances
      enforceable: any Encumbrance (other than Permitted Liens) in
      respect of any of the property (or part thereof) which is the subject of
      any of the Security Documents becomes enforceable;
      or

            

    

     

    
      	
              10.1.21

            	
              De-listing
      etc.: the shares of the Corporate Guarantor are de-listed from or
      suspended from trading on, or cease to trade (whether permanently or
      temporarily for longer than ten (10) consecutive days) on, NASDAQ at any
      time, unless at that time they trade on another comparable stock exchange
      acceptable to the Agent in its sole discretion;
      or

            

    

     

    
      	
              10.1.22

            	
              Material
      adverse change: there occurs, in the opinion of the Agent, a
      material adverse change in the business, management, assets, operations,
      results of operations, properties, performances, prospects or the
      condition (financial or otherwise) of either Borrower or any other
      Security Party or any other member of the Group from that existing on the
      date of this Agreement, as described by or on behalf of the Borrowers or
      any other Security Party to the Agent and/or the Arranger in the
      negotiation of this Agreement which in the reasonable opinion of the Agent
      (following consultation with the Banks) is likely, materially and
      adversely, to affect the ability of any Security Party to perform all or
      any of its obligations under, or otherwise to comply with the terms of,
      any of the Security Documents;
or

            

    

     

    
      
         

      

      
        37

        
          

        

      

      
         

      

    

    
 

     

    
      	
              10.1.23

            	
              Arrest:
      either Ship is arrested, confiscated, seized, taken in execution,
      impounded, forfeited, detained in exercise or purported exercise of any
      possessory lien or other claim or otherwise taken from the possession of
      the relevant Borrower and such Borrower shall fail to procure the release
      of such Ship within a period of ten (10) days thereafter;
      or

            

    

     

    
      	
              10.1.24

            	
              Registration:
      the registration of either Ship under the laws and flag of the relevant
      Flag State is cancelled or terminated without the prior written consent of
      the Agent (acting on the instructions of the Majority Banks) or if such
      registration of such Ship is not renewed at least thirty (30) days prior
      to the expiry of such registration;
  or

            

    

     

    
      	
              10.1.25

            	
              Unrest:
      the Flag State of either Ship becomes involved in hostilities or civil war
      or there is a seizure of power in the Flag State of either Ship by
      unconstitutional means if, in any such case such event could in the
      opinion of the Agent reasonably be expected to have a material adverse
      effect on the security constituted by any of the Security Documents;
      or

            

    

     

    
      	
              10.1.26

            	
              Environment:
      either Borrower and/or any other Relevant Party and/or any of their
      respective Environmental Affiliates fails to comply with any Environmental
      Law or any Environmental Approval or either of the Ships or any other
      Relevant Ship is involved in any incident which gives rise or may give
      rise to an Environmental Claim;
or

            

    

     

    
      	
              10.1.27

            	
              P&I:
      either Borrower or any other person fails or omits to comply with any
      requirements of the protection and indemnity association or other insurer
      with which such Borrower’s Ship is entered for insurance or insured
      against protection and indemnity risks (including oil pollution risks) to
      the effect that any cover (including, without limitation, any cover in
      respect of liability for Environmental Claims arising in jurisdictions
      where such Ship operates or trades) is or may be liable to cancellation,
      qualification or exclusion at any time;
  or

            

    

     

    
      	
              10.1.28

            	
              Shareholdings:
      there is any change in the legal and/or ultimate beneficial ownership of
      any of the shares in any of the Borrowers, the Corporate Guarantor, the
      Manager or any of them such
that:

            

    

     

    
      	
               
      

            	
              (a)

            	
              either of the
      Borrower ceases to be a wholly-owned direct Subsidiary of the Corporate
      Guarantor; or

            

    

     

    
      	
               
      

            	
              (b)

            	
              all of the
      shares of the Manager cease to be ultimately beneficially owned by the
      person or persons being the ultimate beneficial owners of all such shares
      on the date of this Agreement, as disclosed to the Agent pursuant to
      clause 7.2.13; or

            

    

     

    
      	
               
      

            	
              (c)

            	
              any person or
      persons acting in concert (other than Mr George Economou and/or family
      trusts and/or foundations of which Mr George Economou is a beneficiary)
      become the ultimate beneficial owners of more than 50% of the total issued
      voting share capital of the Corporate Guarantor or have the control of the
      Corporate Guarantor or of its board of directors at any relevant time (and
      “control”
      shall have the meaning given to it in the definition of “Subsidiary” in
      clause 1.2); or

            

    

     

    
      	
              10.1.29

            	
              Accounts:
      moneys are withdrawn from either of the Operating Accounts other than in
      accordance with clause 14 or as otherwise
      provided in this Agreement;
or

            

    

     

    
      	
              10.1.30

            	
              Manager:
      either Ship ceases to be managed by the Manager;
      or

            

    

     

    
      	
              10.1.31

            	
              Licenses,
      etc:  any license, authorisation, consent or approval at
      any time necessary to enable any Security Party to comply with its
      obligations under the Security Documents is revoked or withheld or
      modified or is otherwise not granted or fails to remain in full force and
      effect or if any exchange control or other law or regulation shall exist
      which would make any transaction under the Security Documents or the
      continuation thereof, unlawful or would prevent the performance by any
      Security Party of any term of any of the Security Documents;
      or

            

    

     

    
      
         

      

      
        38

        
          

        

      

      
         

      

    

    
 

     

    
      	
              10.1.32

            	
              Material
      events: any other event occurs or circumstance arises which, in the
      reasonable opinion of the Agent (following consultation with the Banks),
      is likely materially and adversely to affect either (a) the ability of any
      Security Party to perform all or any of its obligations under or otherwise
      to comply with the terms of any of the Security Documents or (b) the
      security created by any of the Security
      Documents.

            

    

     

    
      	
              10.2

            	
              Acceleration

            

    

     

    The
Agent may, and if so requested by the Majority Banks shall, without prejudice to
any other rights of the Banks, at any time after the happening of an Event of
Default by notice to the Borrowers declare that:

     

    
      	
              10.2.1

            	
              the
      obligation of each Bank to make its Commitment available shall be
      terminated, whereupon the Total Commitment shall be reduced to zero
      forthwith; and/or

            

    

     

    
      	
              10.2.2

            	
              the
      Loan and all interest and commitment commission accrued and all other sums
      payable under the Security Documents have become due and payable,
      whereupon the same shall, immediately or in accordance with the terms of
      such notice, become due and
payable.

            

    

     

    
      	
              10.3

            	
              Demand
      basis

            

    

     

    If, pursuant
to clause 10.2.2, the Agent declares the Loan to be due and payable on demand, the Agent
may (and if so instructed by the Majority Banks shall) by written notice to the
Borrowers (a) call for repayment of the Loan on such date as may be specified
whereupon the Loan shall become due and payable on the date so specified
together with all interest and commitment commission accrued and all other sums
payable under this Agreement or (b) withdraw such declaration with effect from
the date specified in such notice.

     

    
      	
              10.4

            	
              Position
      of Swap Provider

            

    

     

    Neither
the Agent nor the Security Agent shall be obliged, in connection with any action
taken or proposed to be taken under or pursuant to the foregoing provisions of
this clause 10, to have any regard to the requirements of the Swap Provider
except to the extent that the Swap Provider is also a Bank.

     

    
      	
              11

            	
              Indemnities

            

    

     

    
      	
              11.1

            	
              Miscellaneous
      indemnities

            

    

     

    The
Borrowers shall on demand indemnify each Creditor, without prejudice to any of
such Creditor's other rights under any of the Security Documents, against any
loss (including loss of Margin) or expense which such Creditor shall certify as
sustained or incurred by it as a consequence of:

     

    
      	
              11.1.1

            	
              any
      default in payment of any sum under any of the Security Documents when
      due;

            

    

     

    
      	
              11.1.2

            	
              the
      occurrence of any other Event of
Default;

            

    

     

    
      	
              11.1.3

            	
              any
      prepayment of the Loan or part thereof being made under clauses 4.2,
      4.3, 4.4,
      8.2.1 or 12.1, or any other
      repayment or prepayment of the Loan or part thereof being made otherwise
      than on an Interest Payment Date relating to the part of the Loan prepaid
      or repaid; or

            

    

     

    
      	
              11.1.4

            	
              either
      Advance not being made for any reason (excluding any default by any
      Creditor) after the Drawdown Notice for such Advance has been
      given,

            

    

     

    
      
         

      

      
        39

        
          

        

      

      
         

      

    

     

    including,
in any such case, but not limited to, any loss or expense sustained or incurred
by the relevant Creditor in maintaining or funding its Contribution or, as the
case may be, Commitment or any part thereof or in liquidating or re-employing
deposits from third parties acquired to effect or maintain its Contribution or,
as the case may be, Commitment or any part thereof or any other amount owing to
such Creditor.

     

    
      	
              11.2

            	
              Currency
      indemnity

            

    

     

    If any
sum due from the Borrowers or either of them under any of the Security Documents
or any order or judgment given or made in relation thereto has to be converted
from the currency (the “first
currency”) in which the same is payable under the relevant Security
Document or under such order or judgment into another currency (the “second currency”) for the
purpose of (a) making or filing a claim or proof against the Borrowers or either
of them, (b) obtaining an order or judgment in any court or other tribunal or
(c) enforcing any order or judgment given or made in relation to any of the
Security Documents, the Borrowers shall indemnify and hold harmless each
Creditor from and against any loss suffered as a result of any difference
between (i) the rate of exchange used for such purpose to convert the sum in
question from the first currency into the second currency and (ii) the rate or
rates of exchange at which the relevant Creditor may in the ordinary course of
business purchase the first currency with the second currency upon receipt of a
sum paid to it in satisfaction, in whole or in part, of any such order,
judgment, claim or proof.

     

    Any amount due
from the Borrowers under this clause 11.2 shall be due as a
separate debt and shall not be affected by judgment being obtained for any other
sums due under or in respect of any of the Security Documents and the term
“rate
of exchange” includes any premium and costs of exchange payable in
connection with the purchase of the first currency with the second
currency.

     

    
      	
              11.3

            	
              Environmental
      indemnity

            

    

     

    The
Borrowers shall indemnify each Creditor on demand and hold it harmless from and
against all costs, expenses, payments, charges, losses, demands, liabilities,
actions, proceedings (whether civil or criminal), penalties, fines, damages,
judgements, orders, sanctions or other outgoings of whatever nature which may be
suffered, incurred or paid by, or made or asserted against such Creditor at any
time, whether before or after the repayment in full of principal and interest
under this Agreement, relating to, or arising directly or indirectly in any
manner or for any cause or reason whatsoever out of an Environmental Claim made
or asserted against such Creditor if such Environmental Claim would not have
been, or been capable of being, made or asserted against such Creditor if it had
not entered into any of the Security Documents and/or exercised any of its
rights, powers and discretions thereby conferred and/or performed any of its
obligations thereunder and/or been involved in any of the transactions
contemplated by the Security Documents.

     

    
      	
              12

            	
              Unlawfulness
      and increased costs

            

    

     

    
      	
              12.1

            	
              Unlawfulness

            

    

     

    If it
is or becomes contrary to any law or regulation for any Bank to contribute to an
Advance or to maintain its Commitment or fund its Contribution, such Bank shall
promptly, through the Agent, give notice to the Borrowers whereupon (a) such
Bank’s Commitment shall be reduced to zero and (b) the Borrowers shall be
obliged to prepay such Bank’s Contribution either (i) forthwith or (ii) on a
future specified date not being earlier than the latest date permitted by the
relevant law or regulation together with interest accrued to the date of
prepayment and all other sums payable by the Borrowers under this Agreement
and/or the Master Swap Agreement.

     

    
      
         

      

      
        40

        
          

        

      

      
         

      

    

    
 

     

    
      	
              12.2

            	
              Increased
      costs

            

    

     

    If the
result of any change in, or in the interpretation or application of, or the
introduction of, any law or any regulation, request or requirement (whether or
not having the force of law, but, if not having the force of law, with which a
Bank or, as the case may be, its holding company habitually complies), including
(without limitation) those relating to Taxation, capital adequacy, liquidity,
reserve assets, cash ratio deposits and special deposits, is to:

     

    
      	
              12.2.1

            	
              subject
      any Bank to Taxes or change the basis of Taxation of any Bank with respect
      to any payment under any of the Security Documents (other than Taxes or
      Taxation on the overall net income, profits or gains of such Bank imposed
      in the jurisdiction in which its principal or lending office under this
      Agreement is located); and/or

            

    

     

    
      	
              12.2.2

            	
              increase
      the cost to, or impose an additional cost on, any Bank or its holding
      company in making or keeping such Bank’s Commitment available or
      maintaining or funding all or part of such Bank’s Contribution;
      and/or

            

    

     

    
      	
              12.2.3

            	
              reduce
      the amount payable or the effective return to any Bank under any of the
      Security Documents; and/or

            

    

     

    
      	
              12.2.4

            	
              reduce
      any Bank's or its holding company's rate of return on its overall capital
      by reason of a change in the manner in which it is required to allocate
      capital resources to such Bank's obligations under any of the Security
      Documents; and/or

            

    

     

    
      	
              12.2.5

            	
              require
      any Bank or its holding company to make a payment or forego a return on or
      calculated by reference to any amount received or receivable by such Bank
      under any of the Security Documents;
and/or

            

    

     

    
      	
              12.2.6

            	
              require
      any Bank or its holding company to incur or sustain a loss (including a
      loss of future potential profits) by reason of being obliged to deduct all
      or part of its Commitment or the Loan from its capital for regulatory
      purposes,

            

    

     

    then and in each such case (subject to clause 12.3):

     

    
      	
               
      

            	
              (a)

            	
              such
      Bank shall (through the Agent) notify the Borrowers in writing of such
      event promptly upon its becoming aware of the same;
  and

            

    

     

    
      	
               
      

            	
              (b)

            	
              the
      Borrowers shall on demand made at any time whether or not such Bank’s
      Contribution has been repaid, pay to the Agent for the account of such
      Bank the amount which such Bank specifies (in a certificate setting forth
      the basis of the computation of such amount but not including any matters
      which such Bank or its holding company regards as confidential) is
      required to compensate such Bank and/or (as the case may be) its holding
      company for such liability to Taxes, cost, reduction, payment , forgone
      return or loss.

            

    

     

    For the
purposes of this clause 12.2 “holding
company” means, in relation to a Bank, the company or entity (if any)
within the consolidated supervision of which such Bank is
included.

     

    
      	
              12.3

            	
              Exception

            

    

     

    Nothing in clause 12.2 shall entitle any Bank to
receive any amount in respect of compensation for any such liability to Taxes,
increased or additional cost, reduction, payment, foregone return or loss to the
extent that the same is the subject of an additional payment under clause
6.6.

     

    
      
         

      

      
        41

        
          

        

      

      
         

      

    

    
 

     

    
      	
              13

            	
              Security,
      set-off and pro-rata payments

            

    

     

    
      	
              13.1

            	
              Application
      of moneys

            

    

     

    All moneys
received by the Agent and/or the Security Agent under or pursuant to any of the
Security Documents and expressed to be applicable in accordance with the
provisions of this clause 13.1 shall be applied in
the following manner:

     

    
      	
              13.1.1

            	
              first,
      in or towards payment of all unpaid costs and expenses which may be owing
      to the Creditors or any of them under any of the Security
      Documents;

            

    

     

    
      	
              13.1.2

            	
              secondly,
      in or towards payment of any unpaid fees payable to the Creditors or any
      of them;

            

    

     

    
      	
              13.1.3

            	
              thirdly,
      in or towards payment of any arrears of interest owing in respect of the
      Loan or any part thereof;

            

    

     

    
      	
              13.1.4

            	
              fourthly,
      in or towards repayment of the Loan (whether the same is due and payable
      or not);

            

    

     

    
      	
              13.1.5

            	
              fifthly,
      in or towards payment to any Bank for any loss suffered by reason of any
      such payment in respect of principal not being effected on an Interest
      Payment Date relating to the part of the Loan repaid or prepaid and which
      amounts are so payable under this
Agreement;

            

    

     

    
      	
              13.1.6

            	
              sixthly,
      in or towards payment to the Swap Provider of any amounts owing to it
      under the Master Swap Agreement;

            

    

     

    
      	
              13.1.7

            	
              seventhly,
      in or towards payment to any Creditor of any other sums owing to it under
      any of the Security Documents; and

            

    

     

    
      	
              13.1.8

            	
              eighthly,
      the surplus (if any) shall be paid to the Borrowers or to whomsoever else
      may be entitled to receive such
surplus.

            

    

     

    
      	
              13.2

            	
              Pro
      rata payments

            

    

     

    
      	
              13.2.1

            	
              If at
      any time any Bank (the “Recovering
      Bank”) receives or recovers any amount owing to it by the Borrowers
      under this Agreement by direct payment, set-off or in any manner other
      than by payment through the Agent pursuant to clauses 6.1 or 6.9 (not
      being a payment received from a Transferee Bank or a sub-participant in
      such Bank’s Contribution or any other payment of an amount due to the
      Recovering Bank for its sole account pursuant to clauses 3.6, 5, 6.6, 11.1, 11.2, 12.1 or
      12.2) the
      Recovering Bank shall, within two (2) Banking Days of such receipt or
      recovery (a “Relevant
      Receipt”) notify the Agent of the amount of the Relevant Receipt.
      If the Relevant Receipt exceeds the amount which the Recovering Bank would
      have received if the Relevant Receipt had been received by the Agent and
      distributed pursuant to clauses 6.1 or
      6.9 (as the case may be)
  then:

            

    

     

    
      	
               
      

            	
              (a)

            	
              within
      two (2) Banking Days of demand by the Agent, the Recovering Bank shall pay
      to the Agent an amount equal (or equivalent) to the
  excess;

            

    

     

    
      	
               
      

            	
              (b)

            	
              the
      Agent shall treat the excess amount so paid by the Recovering Bank as if
      it were a payment made by the Borrowers and shall distribute the same to
      the Banks (other than the Recovering Bank) in accordance with clause
      6.9;
      and

            

    

     

    
      	
               
      

            	
              (c)

            	
              as
      between the Borrowers and the Recovering Bank the excess amount so
      re-distributed shall be treated as not having been paid but the
      obligations of the Borrowers to the other Banks shall, to the extent of
      the amount so re-distributed to them, be treated as
      discharged.

            

    

     

    
      
         

      

      
        42

        
          

        

      

      
         

      

    

    
 

     

    
      	
              13.2.2

            	
              If
      any part of the Relevant Receipt subsequently has to be wholly or partly
      refunded by the Recovering Bank (whether to a liquidator or otherwise)
      each Bank to which any part of such Relevant Receipt was so re-distributed
      shall on request from the Recovering Bank repay to the Recovering Bank
      such Bank’s pro-rata share of the amount which has to be refunded by the
      Recovering Bank.

            

    

     

    
      	
              13.2.3

            	
              Each
      Bank shall on request supply to the Agent such information as the Agent
      may from time to time request for the purpose of this
      clause 13.2.

            

    

     

    
      	
              13.2.4

            	
              Notwithstanding
      the foregoing provisions of this clause 13.2, no Recovering Bank
      shall be obliged to share any Relevant Receipt which it receives or
      recovers pursuant to legal proceedings taken by it to recover any sums
      owing to it under this Agreement with any other party which has a legal
      right to, but does not, either join in such proceedings or commence and
      diligently pursue separate proceedings to enforce its rights in the same
      or another court (unless the proceedings instituted by the Recovering Bank
      are instituted by it without prior notice having been given to such party
      through the Agent).

            

    

     

    
      	
              13.3

            	
              Set-off

            

    

     

    
      	
              13.3.1

            	
              Each
      Borrower authorises each Creditor (without prejudice to any of such
      Creditor’s rights at law, in equity or otherwise), at any time and without
      notice to such Borrower, to apply any credit balance to which such
      Borrower is then entitled standing upon any account of such Borrower with
      any branch of such Creditor in or towards satisfaction of any sum due and
      payable from such Borrower to such Creditor under any of the Security
      Documents.  For this purpose, each Creditor is authorised to
      purchase with the moneys standing to the credit of such account such other
      currencies as may be necessary to effect such
  application.

            

    

     

    
      	
              13.3.2

            	
              No
      Creditor shall be obliged to exercise any right given to it by this
      clause 13.2.  Each Creditor shall notify the Agent and the
      relevant Borrower forthwith upon the exercise or purported exercise of any
      right of set-off giving full details in relation thereto and the Agent
      shall inform the other Creditors.

            

    

     

    
      	
              13.4

            	
              No
      release

            

    

     

    For the
avoidance of doubt it is hereby declared that failure by any Recovering Bank to
comply with the provisions of clause 13.2 shall not release any other
Recovering Bank from any of its obligations or liabilities under
clause 13.2.

     

    
      	
              13.5

            	
              No
      charge

            

    

     

    The provisions
of this clause 13 shall not, and shall not be construed so as to, constitute a
charge or other security interest by a Creditor over all or any part of a sum
received or recovered by it in the circumstances mentioned in
clause 13.2.

     

    
      	
              13.6

            	
              Further
      assurance

            

    

     

    The
Borrowers jointly and severally undertake that the Security Documents shall both
at the date of execution and delivery thereof and so long as any moneys are
owing under any of the Security Documents be valid and binding obligations of
the respective parties thereto and rights of each Creditor enforceable in
accordance with their respective terms and that they will, at their expense,
execute, sign, perfect and do, and will procure the execution, signing,
perfecting and doing by each of the other Security Parties of, any and every
such further assurance, document, act or thing as in the reasonable opinion of
the Majority Banks may be necessary or desirable for perfecting the security
contemplated or constituted by the Security Documents.

     

    
      
         

      

      
        43

        
          

        

      

      
         

      

    

    
 

     

    
      	
              13.7

            	
              Conflicts

            

    

     

    In the
event of any conflict between this Agreement and any of the other Borrowers'
Security Documents, the provisions of this Agreement shall prevail.

     

    
      	
              14

            	
              Operating
      Accounts

            

    

     

    
      	
              14.1

            	
              General

            

    

     

    The
Borrowers jointly and severally undertake with each Creditor that they
will:

     

    
      	
              14.1.1

            	
              on
      or before the Drawdown Date of the first Advance to be drawn down, open
      each of the Operating Accounts; and

            

    

     

    
      	
              14.1.2

            	
              procure
      that all moneys payable to a Borrower in respect of the Earnings (as
      defined in the relevant Deed of Covenant) of such Borrower’s Ship shall,
      unless and until the Agent (acting on the instructions of the Majority
      Banks) directs to the contrary pursuant to clause 2.1 of each of the Deed
      of Covenant, be paid to such Borrower’s Operating Account Provided however
      that if any of the moneys paid to either of the Operating Accounts are
      payable in a currency other than Dollars, the Account Bank shall (and the
      Borrowers hereby irrevocably and unconditionally instruct the Account Bank
      to) convert such moneys into Dollars at the Account Bank’s spot rate of
      exchange at the relevant time for the purchase of Dollars with such
      currency and the term “spot rate of exchange”
      shall include any premium and costs of exchange payable in connection with
      the purchase of Dollars with such
currency.

            

    

     

    
      	
              14.2

            	
              Account
      terms

            

    

     

    Amounts
standing to the credit of the Operating Accounts shall (unless otherwise agreed
between the Account Bank and the Borrowers) bear interest at the rates from time
to time offered by the Account Bank to its customers for Dollar deposits in
comparable amounts for comparable periods.  Interest shall accrue on
the Operating Accounts from day to day and be calculated on the basis of actual
days elapsed and a three hundred and sixty (360) day year and shall be credited
to the Operating Accounts at such times as the Account Bank and the Borrowers
shall agree.

     

    
      	
              14.3

            	
              Withdrawals

            

    

     

    Unless
the Agent (acting on the instructions of the Majority Banks) otherwise agrees in
writing, neither Borrower shall be entitled to withdraw any moneys from its
Operating Account at any time from the date of this Agreement and so long as any
moneys are owing under the Security Documents save that, unless and until a
Default shall occur and the Agent (acting on the instructions of the Majority
Banks) shall direct to the contrary, each Borrower may withdraw moneys from its
Operating Account:

     

    
      	
              14.3.1

            	
              to
      pay any amount to the Agent in or towards payments of any instalments of
      interest or principal or any other amounts then payable pursuant to the
      Security Documents;

            

    

     

    
      	
              14.3.2

            	
              to
      pay the proper and reasonable operating expenses of its
    Ship;

            

    

     

    
      	
              14.3.3

            	
              to
      pay the proper and reasonable expenses of administering its affair;
      and

            

    

     

    
      	
              14.3.4

            	
              to
      make any payments of dividends to the extent permitted by clause
      8.3.12.

            

    

     

    
      
         

      

      
        44

        
          

        

      

      
         

      

    

    
 

     

    
      	
              14.4

            	
              Application
      of accounts

            

    

     

    At any time
after the occurrence of an Event of Default, the Agent may (and on the
instructions of the Majority Banks shall), without notice to the Borrowers,
instruct the Account Bank to apply all moneys then standing to the credit of the
Operating Accounts or either of them (together with interest from time to time
accruing or accrued thereon) in or towards satisfaction of any sums due to the
Creditors or any of them under the Security Documents in the manner specified in
clause 13.1.

     

    
      	
              14.5

            	
              Charging
      of Operating Accounts

            

    

     

    The
Operating Accounts and all amounts from time to time standing to the credit
thereof shall be subject to the security constituted and the rights conferred by
the Operating Account Assignments.

     

    
      	
              15

            	
              Assignment,
      transfer and lending office

            

    

     

    
      	
              15.1

            	
              Benefit
      and burden

            

    

     

    This
Agreement shall be binding upon, and enure for the benefit of, the Creditors and
the Borrowers and their respective successors in title.

     

    
      	
              15.2

            	
              No
      assignment by Borrowers

            

    

     

    Neither
Borrower may assign or transfer any of its rights or obligations under this
Agreement.

     

    
      	
              15.3

            	
              Transfers
      by Banks

            

    

     

    Subject
to the prior written consent of the Borrowers (such consent not to be
unreasonably withheld and the request for which to be promptly responded to) and
the Agent and any Bank (the “Transferor Bank”) may at any
time cause all or any part of its rights, benefits and/or obligations under this
Agreement and the Security Documents to be transferred to any other bank or
financial institution experienced in shipping finance (a “Transferee Bank”) by
delivering to the Agent a Transfer Certificate duly completed and duly executed
by the Transferor Bank and the Transferee Bank.  No such transfer is
binding on, or effective in relation to, the Borrowers, the Agent or the other
Creditors unless (i) it is effected or evidenced by a Transfer Certificate which
complies with the provisions of this clause 15.3 and is signed by or on behalf
of the Transferor Bank, the Transferee Bank and the Agent (on behalf of itself,
the Borrowers and the other Creditors) and (ii) such transfer of rights under
the other Security Documents has been effected and registered.  Upon
signature of any such Transfer Certificate by the Agent, which signature shall
be effected as promptly as is practicable after such Transfer Certificate has
been delivered to the Agent, and subject to the terms of such Transfer
Certificate, such Transfer Certificate shall have effect as set out
below.

     

    The
following further provisions shall have effect in relation to any Transfer
Certificate:

     

    
      	
              15.3.1

            	
              a
      Transfer Certificate may be in respect of a Bank’s rights in respect of
      all, or part of, its Commitment and shall be in respect of the same
      proportion of its Contribution;

            

    

     

    
      	
              15.3.2

            	
              a
      Transfer Certificate shall only be in respect of rights and obligations of
      the Transferor Bank in its capacity as a Bank and shall not transfer its
      rights and obligations as Agent, Security Agent or in any other capacity,
      as the case may be and such other rights and obligations may only be
      transferred in accordance with any applicable provisions of this
      Agreement;

            

    

     

    
      
         

      

      
        45

        
          

        

      

      
         

      

    

    
 

     

    
      	
              15.3.3

            	
              a
      Transfer Certificate shall take effect in accordance with English law as
      follows:

            

    

     

    
      	
               
      

            	
              (a)

            	
              to
      the extent specified in the Transfer Certificate, the Transferor Bank’s
      payment rights and all its other rights (other than those referred to in
      sub-clause 15.3.2 above) under this Agreement are assigned to the
      Transferee Bank absolutely, free of any defects in the Transferor Bank’s
      title and of any rights or equities which the Borrowers or either of them
      had against the Transferor Bank;

            

    

     

    
      	
               
      

            	
              (b)

            	
              the
      Transferor Bank’s Commitment is discharged to the extent specified in the
      Transfer Certificate;

            

    

     

    
      	
               
      

            	
              (c)

            	
              the
      Transferee Bank becomes a Bank with a Contribution and a Commitment of the
      amounts specified in the Transfer
Certificate;

            

    

     

    
      	
               
      

            	
              (d)

            	
              the
      Transferee Bank becomes bound by all the provisions of this Agreement and
      the Security Documents which are applicable to the Banks generally,
      including those about pro-rata sharing and the exclusion of liability on
      the part of, and the indemnification of, the Agent, the Security Agent,
      the Swap Provider and the Arranger in accordance with the provisions of
      clause 16 and to the extent that the Transferee Bank becomes bound by
      those provisions, the Transferor Bank ceases to be bound by
      them;

            

    

     

    
      	
               
      

            	
              (e)

            	
              an
      Advance or part of an Advance which the Transferee Bank makes after the
      Transfer Certificate comes into effect ranks in point of priority and
      security in the same way as it would have ranked had it been made by the
      Transferor Bank, assuming that any defects in the Transferor Bank’s title
      and any rights or equities of any Security Party against the Transferor
      Bank had not existed; and

            

    

     

    
      	
               
      

            	
              (f)

            	
              the
      Transferee Bank becomes entitled to all the rights under this Agreement
      which are applicable to the Banks generally, including but not limited to
      those relating to the Majority Banks and those under clauses
      3.6, 5
      and 12 and to the extent that the Transferee Bank becomes entitled to such
      rights, the Transferor Bank ceases to be entitled to
      them;

            

    

     

    
      	
              15.3.4

            	
              the
      rights and equities of the Borrowers or of any other Security Party
      referred to above include, but are not limited to, any right of set-off
      and any other kind of cross-claim;
and

            

    

     

    
      	
              15.3.5

            	
              the
      Borrowers, the Account Bank, the Security Agent, the Swap Provider and the
      Banks hereby irrevocably authorise and instruct the Agent to sign any such
      Transfer Certificate on their behalf and undertake not to withdraw, revoke
      or qualify such authority or instruction at any time.  Promptly
      upon its signature of any Transfer Certificate, the Agent shall notify the
      Borrowers, the Security Agent, the Swap Provider, the Account Bank, the
      Arranger, the Transferor Bank, the Transferee Bank and the other
      Banks.

            

    

     

    
      	
              15.4

            	
              Reliance
      on Transfer Certificate

            

    

     

    
      	
              15.4.1

            	
              The
      Agent shall be entitled to rely on any Transfer Certificate believed by it
      to be genuine and correct and to have been presented or signed by the
      persons by whom it purports to have been presented or signed, and shall
      not be liable to any of the parties to this Agreement and the Security
      Documents for the consequences of such
reliance.

            

    

     

    
      	
              15.4.2

            	
              The
      Agent shall at all times during the continuation of this Agreement
      maintain a register in which it shall record the name, Commitments,
      Contributions and administrative details (including the lending office)
      from time to time of the Banks holding a Transfer Certificate and the date
      at which the transfer referred to in such Transfer Certificate held by
      each Bank was transferred to such Bank, and the Agent shall make the said
      register available for inspection by any Bank, the Security Agent, the
      Swap Provider, the Account Bank or either Borrower during normal banking
      hours upon receipt by the Agent of reasonable prior notice requesting the
      Agent to do so.

            

    

     

    
      
         

      

      
        46

        
          

        

      

      
         

      

    

    
 

     

    
      	
              15.4.3

            	
              The
      entries on the said register shall, in the absence of manifest error, be
      conclusive in determining the identities of the Commitments, the
      Contributions and the Transfer Certificates held by the Banks from time to
      time and the principal amounts of such Transfer Certificates and may be
      relied upon by the Agent, the other Creditors and the Security Parties for
      all purposes in connection with this Agreement and the Security
      Documents.

            

    

     

    
      	
              15.5

            	
              Transfer
      fees and expenses

            

    

     

    If any
Bank causes the transfer of all or any part of its rights, benefits and/or
obligations under the Security Documents, it shall pay to the Agent and/or the
Security Agent on demand all costs, fees and expenses (including, but not
limited to, legal fees and expenses), and all value added tax thereon, verified
by the Agent or, as the case may be, the Security Agent as having been incurred
by it in connection with such transfer.

     

    
      	
              15.6

            	
              Documenting
      transfers

            

    

     

    If any
Bank transfers all or any part of its rights, benefits and/or obligations as
provided in clause 15.3, the Borrowers jointly and severally undertake with
each Creditor, immediately on being requested to do so by the Agent and at the
cost of the Transferor Bank, to enter into, and procure that the other Security
Parties shall (at the cost of the Transferor Bank) enter into, such documents as
may be necessary or desirable to transfer to the Transferee Bank all or the
relevant part of such Bank’s interest in the Security Documents and all relevant
references in this Agreement to such Bank shall thereafter be construed as a
reference to the Transferor Bank and/or its Transferee Bank (as the case may be)
to the extent of their respective interests.

     

    
      	
              15.7

            	
              Sub-participation

            

    

     

    A Bank
may sub-participate to any other bank or financial institution all or any part
of its rights and/or obligations under the Security Documents without the
consent of, or notice to, the Borrowers but with the prior written consent of
the Agent (acting on the instructions of the Majority Banks).

     

    
      	
              15.8

            	
              Lending
      offices

            

    

     

    Each
Bank shall lend through its office at the address specified in schedule 1
or, as the case may be, in any relevant Transfer Certificate or through any
other office of such Bank selected from time to time by such Bank through which
such Bank wishes to lend for the purposes of this Agreement.  If the
office through which a Bank is lending is changed pursuant to this
clause 15.8, such Bank shall notify the Agent promptly of such change and
the Agent shall notify the Borrowers, the Security Agent, the Swap Provider, the
Account Bank and the other Banks.

     

    
      	
              15.9

            	
              Disclosure
      of information

            

    

     

    Any
Bank may, with the prior written consent of the Agent, disclose to a prospective
Transferee Bank or to any other person who may propose entering into contractual
relations with such Bank in relation to this Agreement such information about
the Borrowers, the other Security Parties or any of them as such Bank shall
consider appropriate.

     

    
      	
              16

            	
              Arranger,
      Agent and Security Agent

            

    

     

    
      	
              16.1

            	
              Appointment
      of the Agent

            

    

     

    Each
Bank and the Swap Provider irrevocably appoints the Agent as its agent for the
purposes of this Agreement and such of the Security Documents to which it may be
appropriate for the Agent to be party. By virtue of such appointment, each of
the Banks and the Swap Provider hereby authorises the Agent:

     

    
      
         

      

      
        47

        
          

        

      

      
         

      

    

    
 

     

    
      	
              16.1.1

            	
              to
      execute such documents as may be approved by the Majority Banks for
      execution by the Agent; and

            

    

     

    
      	
              16.1.2

            	
              (whether
      or not by or through employees or agents) to take such action on such
      Bank’s or, as the case may be, the Swap Provider’s behalf and to exercise
      such rights, remedies, powers and discretions as are specifically
      delegated to the Agent by this Agreement and/or any other Security
      Document, together with such powers and discretions as are reasonably
      incidental thereto.

            

    

     

    
      	
              16.2

            	
              Agent’s
      actions

            

    

     

    Any
action taken by the Agent under or in relation to this Agreement or any of the
other Security Documents whether with requisite authority, or on the basis of
appropriate instructions, received from the Banks (or as otherwise duly
authorised) shall be binding on all the Banks, the Swap Provider and the other
Creditors.

     

    
      	
              16.3

            	
              Agent’s
      duties

            

    

     

    The Agent shall:

     

    
      	
              16.3.1

            	
              promptly
      notify each Bank of the contents of each notice, certificate or other
      document received by it from the Borrowers under or pursuant to clauses
      8.1.1, 8.1.5, 8.1.6 and 8.1.7; and

            

    

     

    
      	
              16.3.2

            	
              (subject
      to the other provisions of this clause 16) take (or instruct the Security
      Agent to take) such action or, as the case may be, refrain from taking (or
      authorise the Security Agent to refrain from taking) such action with
      respect to the exercise of any of its rights, remedies, powers and
      discretions as agent, as the Majority Banks may
  direct.

            

    

     

    
      	
              16.4

            	
              Agent’s
      rights

            

    

     

    The
Agent may:

     

    
      	
              16.4.1

            	
              in
      the exercise of any right, remedy, power or discretion in relation to any
      matter, or in any context, not expressly provided for by this Agreement or
      any of the other Security Documents, act or, as the case may be, refrain
      from acting (or authorise the Security Agent to act or refrain from
      acting) in accordance with the instructions of the Banks, and shall be
      fully protected in so doing;

            

    

     

    
      	
              16.4.2

            	
              unless
      and until it shall have received directions from the Majority Banks, take
      such action or, as the case may be, refrain from taking such action (or
      authorise the Security Agent to take or refrain from taking such action)
      in respect of a Default of which the Agent has actual knowledge as it
      shall deem advisable in the best interests of the Banks and the Swap
      Provider (but shall not be obliged to do
so);

            

    

     

    
      	
              16.4.3

            	
              refrain
      from acting (or authorise the Security Agent to refrain from acting) in
      accordance with any instructions of the Banks to institute any legal
      proceedings arising out of or in connection with this Agreement or any of
      the other Security Documents until it and/or the Security Agent has been
      indemnified and/or secured to its satisfaction against any and all costs,
      expenses or liabilities (including legal fees) which it would or might
      incur as a result;

            

    

     

    
      	
              16.4.4

            	
              deem
      and treat (i) each Bank as the person entitled to the benefit of the
      Contribution of such Bank for all purposes of this Agreement unless and
      until a Transfer Certificate shall have been filed with the Agent pursuant
      to clause 15.3 and shall have become effective, and (ii) the office set
      opposite the name of each of the Banks in schedule 1 or, as the case may
      be, in any relevant Transfer Certificate as such Bank’s lending office
      unless and until a written notice of change of lending office shall have
      been received by the Agent and the Agent may act upon any such notice
      unless and until the same is superseded by a further such
      notice;

            

    

     

    
      
         

      

      
        48

        
          

        

      

      
         

      

    

    
 

     

    
      	
              16.4.5

            	
              rely
      as to matters of fact which might reasonably be expected to be within the
      knowledge of any Security Party upon a certificate signed by any director
      or officer of the relevant Security Party on behalf of the relevant
      Security Party; and

            

    

     

    
      	
              16.4.6

            	
              do
      anything which is in its opinion necessary or desirable to comply with any
      law or regulation in any
jurisdiction.

            

    

     

    
      	
              16.5

            	
              No
      liability of Arranger or Agent

            

    

     

    Neither
the Arranger nor the Agent nor any of their respective employees and agents
shall:

     

    
      	
              16.5.1

            	
              be
      obliged to make any enquiry as to the use of any of the proceeds of either
      Advance unless (in the case of the Agent) so required in writing by a
      Bank, in which case the Agent shall promptly make the appropriate request
      to the Borrowers; or

            

    

     

    
      	
              16.5.2

            	
              be
      obliged to make any enquiry as to any breach or default by either of the
      Borrowers or any other Security Party in the performance or observance of
      any of the provisions of this Agreement or any of the other Security
      Documents or as to the existence of a Default unless the Agent has actual
      knowledge thereof or has been notified in writing thereof by a Bank, in
      which case the Agent shall promptly notify the Banks of the relevant event
      or circumstance; or

            

    

     

    
      	
              16.5.3

            	
              be
      obliged to enquire whether or not any representation or warranty made by
      either of the Borrowers or any other Security Party pursuant to this
      Agreement or any of the other Security Documents is true;
    or

            

    

     

    
      	
              16.5.4

            	
              be
      obliged to do anything (including, without limitation, disclosing any
      document or information) which would, or might in its opinion, be contrary
      to any law or regulation or be a breach of any duty of confidentiality or
      otherwise be actionable or render it liable to any person;
    or

            

    

     

    
      	
              16.5.5

            	
              be
      obliged to account to any Bank for any sum or the profit element of any
      sum received by it for its own account;
or

            

    

     

    
      	
              16.5.6

            	
              be
      obliged to institute any legal proceedings arising out of or in connection
      with this Agreement or any of the other Security Documents other than on
      the instructions of the Majority Banks;
or

            

    

     

    
      	
              16.5.7

            	
              be
      liable to any Bank or the Swap Provider for any action taken or omitted
      under or in connection with this Agreement or any of the other Security
      Documents unless caused by its gross negligence or wilful
      misconduct.

            

    

     

    For the
purposes of this clause 16, neither the Arranger nor the Agent shall be treated
as having actual knowledge of any matter of which the corporate finance or any
other division outside the agency or loan administration department of the
Arranger or the person for the time being acting as the Agent may become aware
in the context of corporate finance, advisory or lending activities from time to
time undertaken by the Arranger or, as the case may be, the Agent for any
Security Party or any other person which may be a trade competitor of any
Security Party or may otherwise have commercial interests similar to those of
any Security Party.

     

    
      
         

      

      
        49

        
          

        

      

      
         

      

    

     

    
      	
              16.6

            	
              Non-reliance
      on Arranger or Agent

            

    

     

    Each Bank and
the Swap Provider acknowledges that it has not relied on any statement, opinion,
forecast or other representation made by the Arranger or the Agent to induce it
to enter into this Agreement or any of the other Security Documents and that it
has made and will continue to make, without reliance on the Arranger or the
Agent and based on such documents as it considers appropriate, its own appraisal
of the creditworthiness of the Security Parties and its own independent
investigation of the financial condition, prospects and affairs of the Security
Parties in connection with the making and continuation of such Bank’s Commitment
or Contribution under this Agreement. Neither the Arranger nor the Agent shall
have any duty or responsibility, either initially or on a continuing basis, to
provide any other Creditor with any credit or other information with respect to
any Security Party whether coming into its possession before the making of
either Advance or at any time or times thereafter other than as provided in
clause 16.3.1.

     

    
      	
              16.7

            	
              No
      responsibility on Arranger or Agent for Borrowers’
    performance

            

    

     

    Neither
the Arranger nor the Agent shall have any responsibility or liability to any
other Creditor:

     

    
      	
              16.7.1

            	
              on
      account of the failure of any Security Party to perform its obligations
      under any of the Security Documents;
or

            

    

     

    
      	
              16.7.2

            	
              for
      the financial condition of any Security Party;
  or

            

    

     

    
      	
              16.7.3

            	
              for
      the completeness or accuracy of any statements, representations or
      warranties in any of the Security Documents or any document delivered
      under any of the Security Documents;
or

            

    

     

    
      	
              16.7.4

            	
              for
      the execution, effectiveness, adequacy, genuineness, validity,
      enforceability or admissibility in evidence of any of the Security
      Documents or of any certificate, report or other document executed or
      delivered under any of the Security Documents;
  or

            

    

     

    
      	
              16.7.5

            	
              to
      investigate or make any enquiry into the title of either of the Borrowers
      or any other Security Party to the Ships or any other security or any part
      thereof; or

            

    

     

    
      	
              16.7.6

            	
              for
      the failure to register any of the Security Documents with any official or
      regulatory body or office or elsewhere;
or

            

    

     

    
      	
              16.7.7

            	
              for
      taking or omitting to take any other action under or in relation to any of
      the Security Documents or any aspect of any of the Security Documents;
      or

            

    

     

    
      	
              16.7.8

            	
              on
      account of the failure of the Security Agent to perform or discharge any
      of its duties or obligations under the Security Documents;
    or

            

    

     

    
      	
              16.7.9

            	
              otherwise
      in connection with this Agreement or its negotiation or for acting (or, as
      the case may be, refraining from acting) in accordance with the
      instructions of the Banks.

            

    

     

    
      	
              16.8

            	
              Reliance
      on documents and professional
advice

            

    

     

    The
Arranger and the Agent shall be entitled to rely on any communication,
instrument or document believed by it to be genuine and correct and to have been
signed or sent by the proper person and shall be entitled to rely as to legal or
other professional matters on opinions and statements of any legal or other
professional advisers selected or approved by it (including those in the
Arranger’s or, as the case may be, the Agent’s employment).

     

    
      
         

      

      
        50

        
          

        

      

      
         

      

    

    
 

     

    
      	
              16.9

            	
              Other
      dealings

            

    

     

    The
Arranger and the Agent may, without any liability to account to any other
Creditor, accept deposits from, lend money to, and generally engage in any kind
of banking or other business with, and provide advisory or other services to,
any Security Party or any of its Related Companies or any of the other Creditors
as if it was not the Arranger or, as the case may be, the Agent.

     

    
      	
              16.10

            	
              Rights
      of Agent as Bank; no partnership

            

    

     

    With
respect to its own Commitment and Contribution (if any) the Agent shall have the
same rights and powers under the Security Documents as any other Bank and may
exercise the same as though it were not performing the duties and functions
delegated to it under this Agreement and the term “Banks” shall, unless the
context clearly otherwise indicates, include the Agent in its individual
capacity as a Bank. This Agreement shall not and shall not be construed so as to
constitute a partnership between the parties or any of them.

     

    
      	
              16.11

            	
              Amendments
      and waivers

            

    

     

    
      	
              16.11.1

            	
              Subject
      to clause 16.11.2, the Agent may, with the written consent of the Majority Banks
      (or if and to the extent expressly authorised by the other provisions of
      any of the Security Documents) and, if so instructed by the Majority
      Banks, shall:

            

    

     

    
      	
               
      

            	
              (a)

            	
              agree
      (or authorise the Security Agent to agree) amendments or modifications to
      any of the Security Documents with any Security Party;
    and/or

            

    

     

    
      	
               
      

            	
              (b)

            	
              waive
      breaches of, or defaults under, or otherwise excuse performance of, any
      provision of any of the other Security Documents by any Security Party (or
      authorise the Security Agent to do
so).

            

    

     

    Any
such action so authorised and effected by the Agent shall be documented in such
manner as the Agent shall (with the approval of the Majority Banks) determine,
shall be promptly notified to the Banks by the Agent and (without prejudice to
the generality of clause 16.2) shall be binding on all
the Creditors.

     

    
      	
              16.11.2

            	
              Except
      with the prior written consent of all the Banks, the Agent shall have no
      authority on behalf of the Banks to agree (or authorise the Security Agent
      to agree) with any Security Party any amendment or modification to any of
      the Security Documents or to grant (or authorise the Security Agent to
      grant) waivers in respect of breaches or defaults or to vary or excuse (or
      authorise the Security Agent to vary or excuse) performance of or under
      any of the Security Documents by any Security Party, if the effect of such
      amendment, modification, waiver or excuse would be
  to:

            

    

     

    
      	
               
      

            	
              (a)

            	
              reduce
      the Margin;

            

    

     

    
      	
               
      

            	
              (b)

            	
              postpone
      the due date or reduce the amount of any payment of principal, interest or
      other amount payable by any Security Party under any of the Security
      Documents;

            

    

     

    
      	
               
      

            	
              (c)

            	
              change
      the currency in which any amount is payable by any Security Party under
      any of the Security Documents;

            

    

     

    
      	
               
      

            	
              (d)

            	
              increase
      any Bank’s Commitment;

            

    

     

    
      	
               
      

            	
              (e)

            	
              extend
      the Termination Date;

            

    

     

    
      	
               
      

            	
              (f)

            	
              change
      any provision of any of the Security Documents which expressly or implied
      requires the approval or consent of all the Banks such that the relevant
      approval or consent may be given otherwise than with the sanction of all
      the Banks;

            

    

     

    
      
         

      

      
        51

        
          

        

      

      
         

      

    

     

     

    
      	
               
      

            	
              (g)

            	
              change
      the order of distribution under clause 6.9 or clause
  13.1;

            

    

     

    
      	
               
      

            	
              (h)

            	
              change
      this clause 16.11;

            

    

     

    
      	
               
      

            	
              (i)

            	
              change
      the definition of “Majority Banks” in
      clause 1.2; or

            

    

     

    
      	
               
      

            	
              (j)

            	
              release
      any Security Party from the security constituted by any Security Document
      (except as required by the terms thereof or by law) or change the terms
      and conditions upon which such security or guarantee may be, or is
      required to be, released.

            

    

     

    
      	
              16.12

            	
              Reimbursement
      and indemnity by Banks

            

    

     

    Each
Bank shall reimburse the Agent (rateably in accordance with such Bank’s
Commitment or, following the first drawdown, Contribution), to the extent that
the Agent is not reimbursed by the Borrowers, for the costs, charges and
expenses incurred by the Agent which are expressed to be payable by the
Borrowers under clause 5.2 including (in each case) the fees and expenses of
legal or other professional advisers. Each Bank shall on demand indemnify the
Agent (rateably in accordance with such Bank’s Commitment or, following the
first drawdown, Contribution) against all liabilities, damages, costs and claims
whatsoever incurred by the Agent in connection with any of the Security
Documents or the performance of its duties under any of the Security Documents
or any action taken or omitted by the Agent under any of the Security Documents,
unless such liabilities, damages, costs or claims arise from the Agent’s own
gross negligence or wilful misconduct.

     

    
      	
              16.13

            	
              Retirement
      of Agent

            

    

     

    
      	
              16.13.1

            	
              The
      Agent may, (having given to the Borrowers, each of the Banks and the Swap
      Provider not less than thirty (30) days’ notice of its intention to do
      so), retire from its appointment as Agent under this Agreement, provided
      that no such retirement shall take effect unless there has been appointed
      by the Banks and the Swap Provider as a successor
  agent:

            

    

     

    
      	
               
      

            	
              (a)

            	
              a
      Bank nominated within a period of twenty eight (28) days by the Majority
      Banks or, failing such a
nomination,

            

    

     

    
      	
               
      

            	
              (b)

            	
              any
      reputable bank or financial institution experienced in shipping finance
      nominated by the retiring Agent.

            

    

     

    Any
corporation into which the retiring Agent may be merged or converted or any
corporation with which the Agent may be consolidated or any corporation
resulting from any merger, conversion, amalgamation, consolidation or other
reorganisation to which the Agent shall be a party shall, to the extent
permitted by applicable law, be the successor Agent under this Agreement and the
other Security Documents without the execution or filing of any document or any
further act on the part of any of the parties to this Agreement and the other
Security Documents save that notice of any such merger, conversion,
amalgamation, consolidation or other reorganisation shall forthwith be given to
each Security Party, the Banks and the Swap Provider.  Prior to any
such successor being appointed, the Agent agrees to consult with the Borrowers
as to the identity of the proposed successor and to take account of any
reasonable objections which the Borrowers may raise to such successor being
appointed.

     

    
      	
              16.13.2

            	
              Upon
      any such successor as aforesaid being appointed, the retiring Agent shall
      be discharged from any further obligation under the Security Documents
      (but shall continue to have the benefit of this clause 16 in respect of
      any action it has taken or refrained from taking prior to such discharge)
      and its successor and each of the other parties to this Agreement shall
      have the same rights and obligations among themselves as they would have
      had if such successor had been a party to this Agreement in place of the
      retiring Agent. The retiring Agent shall (at the expense of the Borrowers)
      provide its successor with copies of such of its records as its successor
      reasonably requires to carry out its functions under the Security
      Documents.

            

    

     

    
      
         

      

      
        52

        
          

        

      

      
         

      

    

    
 

     

    
      	
              16.14

            	
              Appointment
      and retirement of Security Agent

            

    

     

    
      	
              16.14.1

            	
              Appointment

            

    

     

    Each of
the Agent, the Swap Provider and the Banks irrevocably appoints the Security
Agent as its security agent and trustee for the purposes of this Agreement and
the other Security Documents on the terms set out in this Agreement. By virtue
of such appointment, the Agent, the Swap Provider and each of the Banks hereby
authorises the Security Agent (whether or not by or through employees or agents)
to take such action on its behalf and to exercise such rights, remedies, powers
and discretions as are specifically delegated to the Security Agent by this
Agreement and/or any of the other Security Documents together with such powers
and discretions as are reasonably incidental thereto.

     

    
      	
              16.14.2

            	
              Retirement

            

    

     

    
      	
               
      

            	
              (a)

            	
              Without
      prejudice to clause 16.13, the Security Agent may, having given to the
      Borrowers and each of the Banks and the Swap Provider not less than
      fifteen (15) days’ notice of its intention to do so, retire from its
      appointment as Security Agent under this Agreement and any Trust Deed,
      provided that no such retirement shall take effect unless there has been
      appointed by the Banks, the Agent and the Swap Provider as a successor
      security agent and trustee:

            

    

     

    
      	
               
      

            	
              (i)

            	
              a
      Related Company of the Security Agent nominated by the Security Agent
      which the Banks hereby irrevocably and unconditionally agree to appoint
      or, failing such nomination,

            

    

     

    
      	
               
      

            	
              (ii)

            	
              a
      bank or trust corporation nominated by the Majority Banks or, failing such
      a nomination,

            

    

     

    (iii)      any
bank or trust corporation nominated by the retiring Security Agent,

     

    and, in
any case (A) such successor security agent and trustee shall have duly accepted
such appointment by delivering to the Agent (1) written confirmation (in a form
acceptable to the Agent) of such acceptance agreeing to be bound by this
Agreement in the capacity of Security Agent as if it had been an original party
to this Agreement and (2) a duly executed Trust Deed and (B) such successor
security agent and trustee shall have duly entered into, whether with the
retiring Security Agent and/or with the Borrowers and/or with the Creditors or
with any of them, such documents in connection with the Security Documents as
the Agent shall require in its absolute discretion.

     

    
      	
               
      

            	
              (b)

            	
              Any
      corporation into which the retiring Security Agent may be merged or
      converted or any corporation with which the Security Agent may be
      consolidated or any corporation resulting from any merger, conversion,
      amalgamation, consolidation or other reorganisation to which the Security
      Agent shall be a party shall, to the extent permitted by applicable law,
      be the successor Security Agent under this Agreement, any Trust Deed and
      the other Security Documents without the execution or filing of any
      document or any further act on the part of any of the parties to this
      Agreement, any Trust Deed and the other Security Documents save that
      notice of any such merger, conversion, amalgamation, consolidation or
      other reorganisation shall forthwith be given to each Security Party, the
      Banks, the Agent and the Swap Provider.  Prior to any such
      successor being appointed, the Security Agent agrees to consult with the
      Borrowers as to the identity of the proposed successor and to take account
      of any reasonable objections which the Borrowers may raise to such
      successor being appointed.

            

    

     

    
      
         

      

      
        53

        
          

        

      

      
         

      

    

     

     

    
      	
               
      

            	
              (c)

            	
              Upon
      any such successor as aforesaid being appointed, the retiring Security
      Agent shall be discharged from any further obligation under the Security
      Documents (but shall continue to have the benefit of this clause 16
      in respect of any action it has taken or refrained from taking prior to
      such discharge) and its successor and each of the other parties to this
      Agreement shall have the same rights and obligations among themselves as
      they would have had if such successor had been a party to this Agreement
      in place of the retiring Security Agent. The retiring Security Agent shall
      (at the expense of the Borrowers) provide its successor with copies of
      such of its records as its successor reasonably requires to carry out its
      functions under the Security
Documents.

            

    

     

    
      	
              16.15

            	
              Powers
      and duties of the Security Agent

            

    

     

    
      	
              16.15.1

            	
              The
      Security Agent shall have no duties, obligations or liabilities to the
      Agent, the Swap Provider or any of the Banks beyond those expressly stated
      in any of the Security Documents. The Agent, the Swap Provider and each of
      the Banks hereby authorises the Security Agent to enter into and
      execute:

            

    

     

    
      	
               
      

            	
              (a)

            	
              each
      of the Security Documents to which the Security Agent is or is intended to
      be a party; and

            

    

     

    
      	
               
      

            	
              (b)

            	
              any
      and all such other Security Documents as may be approved by the Agent in
      writing (acting on the instructions of the Majority Banks) for entry into
      by the Security Agent,

            

    

     

    and, in
each and every case, to hold any and all security thereby created upon trust for
the Banks, the Agent and the Swap Provider in the manner contemplated by this
Agreement.

     

    
      	
              16.15.2

            	
              Subject
      to clause 16.15.3 the Security Agent may, with the prior consent of the Majority
      Banks communicated in writing by the Agent, concur with any of the
      Security Parties to:

            

    

     

    
      	
               
      

            	
              (a)

            	
              amend,
      modify or otherwise vary any provision of the Security Documents to which
      the Security Agent is or is intended to be a party;
  or

            

    

     

    
      	
               
      

            	
              (b)

            	
              waive
      breaches of, or defaults under, or otherwise excuse performance of, any
      provision of the Security Documents to which the Security Agent is or is
      intended to be a party.

            

    

     

    Any such
action so authorised and effected by the Security Agent shall be promptly
notified to the Banks, the Agent and the Swap Provider by the Security Agent and
shall be binding on all the Creditors.

     

    
      	
              16.15.3

            	
              The
      Security Agent shall not concur with any Security Party with respect to
      any of the matters described in clause 16.11.2 without the
      consent of all the Banks communicated in writing by the
      Agent.

            

    

     

    
      	
              16.15.4

            	
              The
      Security Agent shall (subject to the other provisions of this clause 16)
      take such action or, as the case may be, refrain from taking such action,
      with respect to any of its rights, powers and discretions as security
      agent and trustee, as the Agent may direct.  Subject as provided
      in the foregoing provisions of this clause, unless and until the Security
      Agent shall have received such instructions from the Agent, the Security
      Agent may, but shall not be obliged to, take (or refrain from taking) such
      action under or pursuant to the Security Documents referred to in clause
      16.15.1 as the Security Agent shall deem advisable in the best interests
      of the Creditors provided that (for the avoidance of doubt), to the extent
      that this clause might otherwise be construed as authorising the Security
      Agent to take, or refrain from taking, any action of the nature referred
      to in clause 16.15.2-and for which the
      prior consent of the Banks is expressly required under clause 16.15.3 - clauses
      16.15.2 and 16.15.3 shall apply to the exclusion of this
      clause.

            

    

     

    
      
         

      

      
        54

        
          

        

      

      
         

      

    

    
 

     

    
      	
              16.15.5

            	
              None
      of the Banks nor the Swap Provider nor the Agent shall have any
      independent power to enforce any of the Security Documents referred to in
      clause 16.15.1 or to exercise any rights, discretions or powers or to
      grant any consents or releases under or pursuant to such Security
      Documents or otherwise have direct recourse to the security and/or
      guarantees constituted by such Security Documents except through the
      Security Agent.

            

    

     

    
      	
              16.15.6

            	
              For the
      purpose of this clause 16, the Security Agent may, rely and act in
      reliance upon any information from time to time furnished to the Security
      Agent by the Agent (whether pursuant to clause 16.15.7 or otherwise)
      unless and until the same is superseded by further such information, so
      that the Security Agent shall have no liability or responsibility to any
      party as a consequence of placing reliance on and acting in reliance upon
      any such information unless the Security Agent has actual knowledge that
      such information is inaccurate or
  incorrect.

            

    

     

    
      	
              16.15.7

            	
              Without
      prejudice to the foregoing, each of the Agent, the Swap Provider and the
      Banks (whether directly or through the Agent) shall provide the Security
      Agent with such written information as it may reasonably require for the
      purpose of carrying out its duties and obligations under the Security
      Documents referred to in clause
16.15.1.

            

    

     

    
      	
              16.15.8

            	
              Each
      Bank shall reimburse the Security Agent (rateably in accordance with such
      Bank’s Commitment or, following the first drawdown, Contribution), to the
      extent that the Security Agent is not reimbursed by the Borrowers, for the
      costs, charges and expenses incurred by the Agent which are expressed to
      be payable by the Borrowers under clause 5.2 including (in each case) the
      fees and expenses of legal or other professional advisers. Each Bank shall
      on demand indemnify the Security Agent (rateably in accordance with such
      Bank’s Commitment or, following the first drawdown, Contribution) against
      all liabilities, damages, costs and claims whatsoever incurred by the
      Security Agent in connection with any of the Security Documents or the
      performance of its duties under any of the Security Documents or any
      action taken or omitted by the Security Agent under any of the Security
      Documents, unless such liabilities, damages, costs or claims arise from
      the Security Agent’s own gross negligence or wilful
      misconduct.

            

    

     

    
      	
              16.16

            	
              Trust
      provisions

            

    

     

    
      	
              16.16.1

            	
              The
      trusts constituted or evidenced in or by this Agreement and the Trust Deed
      shall remain in full force and effect until whichever is the earlier
      of:

            

    

     

    
      	
               
      

            	
              (a)

            	
              the
      expiration of a period of eighty (80) years from the date of this
      Agreement; and

            

    

     

    
      	
               
      

            	
              (b)

            	
              receipt
      by the Security Agent of confirmation in writing by the Agent that there
      is no longer outstanding any Indebtedness (actual or contingent) which is
      secured or guaranteed or otherwise assured by or under any of the Security
      Documents,

            

    

     

    and the
parties to this Agreement declare that the perpetuity period applicable to this
Agreement and the trusts declared by the Trust Deed shall for the purposes of
the Perpetuities and Accumulations Act 1964 be the period of eighty (80) years
from the date of this Agreement.

     

    
      	
              16.16.2

            	
              In
      its capacity as trustee in relation to the Security Documents specified in
      clause 16.15.1 the Security Agent shall, without prejudice to any of the
      powers, discretions and immunities conferred upon trustees by law (and to
      the extent not inconsistent with the provisions of any of those Security
      Documents), have all the same powers and discretions as a natural person
      acting as the beneficial owner of such property and/or as are conferred
      upon the Security Agent by any of those Security
  Documents.

            

    

     

    
      
         

      

      
        55

        
          

        

      

      
         

      

    

    
 

     

    
      	
              16.16.3

            	
              It
      is expressly declared that, in its capacity as trustee in relation to the
      Security Documents specified in clause 16.15.1, the Security Agent shall
      be entitled to invest moneys forming part of the security and which, in
      the opinion of the Security Agent, may not be paid out promptly following
      receipt in the name or under the control of the Security Agent in any of
      the investments for the time being authorised by law for the investment by
      trustees of trust moneys or in any other property or investments whether
      similar to the aforesaid or not or by placing the same on deposit in the
      name or under the control of the Security Agent as the Security Agent may
      think fit without being under any duty to diversify its investments and
      the Security Agent may at any time vary or transpose any such property or
      investments for or into any others of a like nature and shall not be
      responsible for any loss due to depreciation in value or otherwise of such
      property or investments. Any investment of any part of all of the security
      may, at the discretion of the Security Agent, be made or retained in the
      names of nominees.

            

    

     

    
      	
              16.17

            	
              Independent
      action by Creditors

            

    

     

    None of
the Creditors shall enforce, exercise any rights, remedies or powers or grant
any consents or releases under or pursuant to, or otherwise have a direct
recourse to the security and/or guarantees constituted by any of the Security
Documents without the prior written consent of the Majority Banks but, Provided
such consent has been obtained, it shall not be necessary for any other Creditor
to be joined as an additional party in any proceedings for this
purpose.

     

    
      	
              16.18

            	
              Common
      Agent and Security Agent

            

    

     

    The
Agent and the Security Agent have entered into the Security Documents in their
separate capacities (a) as agent for the Banks and the Swap Provider under and
pursuant to this Agreement (in the case of the Agent) and (b) as security agent
and trustee for the Agent, the Banks and the Swap Provider, under and pursuant
to this Agreement, to hold the guarantees and/or security created by the other
Security Documents specified in clause 16.15.1 on the terms set out in such
Security Documents (in the case of the Security Agent). However, from time to
time the Agent and the Security Agent may be the same entity. When the Agent and
the Security Agent are the same entity and any Security Document provides for
the Agent to communicate with or provide instructions to the Security Agent (and
vice versa), it will not be necessary for there to be any such formal
communications or instructions on those occasions.

     

    
      	
              16.19

            	
              Co-operation
      to achieve agreed priorities of
application

            

    

     

    The
Banks, the Agent and the Swap Provider shall co-operate with each other and with
the Security Agent and any receiver under the Security Documents in realising
the property and assets subject to the Security Documents and in ensuring that
the net proceeds realised under the Security Documents after deduction of the
expenses of realisation are applied in accordance with
clause 13.1.

     

    
      	
              16.20

            	
              Prompt
      distribution of proceeds

            

    

     

    Moneys
received by any of the Creditors (whether from a receiver or otherwise) pursuant
to the exercise of (or otherwise by virtue of the existence of) any rights and
powers under or pursuant to any of the Security Documents shall (after providing
for all costs, charges, expenses and liabilities and other payments ranking in
priority) be paid to the Agent for distribution (in the case of moneys so
received by any of the Creditors other than the Agent or the Security Agent) and
shall be distributed by the Agent or, as the case may be, the Security Agent (in
the case of moneys so received by the Agent or, as the case may be, the Security
Agent) in each case in accordance with clause 13.1.  The Agent
or, as the case may be, the Security Agent shall make each such application
and/or distribution as soon as is practicable after the relevant moneys are
received by, or otherwise become available to, the Agent or, as the case may be,
the Security Agent save that (without prejudice to any other provision contained
in any of the Security Documents) the Agent or, as the case may be, the Security
Agent (acting on the instructions of the Majority Banks) or any receiver may
credit any moneys received by it to a suspense account

     

    
      
         

      

      
        56

        
          

        

      

      
         

      

    

    for so
long and in such manner as the Agent or such receiver may from time to time
determine with a view to preserving the rights of the Agent and/or the Security
Agent and/or the Account Bank and/or the Swap Provider and/or the Arranger
and/or the Banks or any of them to provide for the whole of their respective
claims against the Borrowers or any other person liable.

     

    
      	
              17

            	
              Notices
      and other matters

            

    

     

    
      	
              17.1

            	
              Notices

            

    

     

    Every
notice, request, demand or other communication under this Agreement or (unless
otherwise provided therein) under any of the other Security Documents
shall:

     

    
      	
              17.1.1

            	
              be
      in writing delivered personally or by first-class prepaid letter (airmail
      if available) or facsimile transmission or other means of
      telecommunication in permanent written
form;

            

    

     

    
      	
              17.1.2

            	
              be
      deemed to have been received, subject as otherwise provided in the
      relevant Security Document, in the case of a letter, when delivered
      personally or three (3) days after it has been put in to the post and, in
      the case of a facsimile transmission or other means of telecommunication
      in permanent written form, at the time of despatch (provided that if the
      date of despatch is not a business day in the country of the addressee or
      if the time of despatch is after the close of business in the country of
      the addressee it shall be deemed to have been received at the opening of
      business on the next such business day);
and

            

    

     

    
      	
              17.1.3

            	
              be
      sent:

            

    

     

    
      	
               
      

            	
              (a)

            	
              if
      to the Borrowers or either of them
at:

            

    

     

     c/o
DryShips Inc.

     Omega
Building

     80
Kifissias Avenue

     151
25 Maroussi

     Greece

     

     Fax
no:        +30 210 8090 275

     Attention:     Mr
Aristidis Ioannidis

     

    
      	
               
      

            	
              (b)

            	
              if
      to the Arranger, the Agent, the Security Agent or the Account Bank
      at:

            

    

     

     DnB
NOR Bank ASA

     20
St. Dunstan’s Hill

     London
EC3R 8HY

     England

     

     Fax
No:        +44 207 626 5956

     Attention:      Shipping
Department

     

    
      	
               
      

            	
              (c)

            	
              in
      the case of a Bank, to its address or facsimile number specified in
      schedule 1 or in any relevant Transfer Certificate;
  or

            

    

     

    
      	
               
      

            	
              (d)

            	
              in
      the case of the Swap Provider, to its address or fax number specified in
      paragraph (a) of Part 4 of the Schedule to the Master Swap
      Agreement,

            

    

     

    or to
such other address and/or numbers as is notified by one party to the other
parties under this Agreement.

     

    
      
         

      

      
        57

        
          

        

      

      
         

      

    

    
 

     

    
      	
              17.2

            	
              Notices
      through the Agent

            

    

     

    Every
notice, request, demand or other communication under this Agreement to be given
by the Borrowers to any other party (other than the Swap Provider) shall be
given to the Agent for onward transmission as appropriate and if such notice,
request, demand or other communication is to be given to the Borrowers it shall
(except if otherwise provided in the Security Documents) be given through the
Agent.

     

    
      	
              17.3

            	
              No
      implied waivers, remedies
cumulative

            

    

     

    No
failure or delay on the part of any Creditor to exercise any power, right or
remedy under any of the Security Documents shall operate as a waiver thereof,
nor shall any single or partial exercise by any Creditor of any power, right or
remedy preclude any other or further exercise thereof or the exercise of any
other power, right or remedy.  The remedies provided in the Security
Documents are cumulative and are not exclusive of any remedies provided by
law.

     

    
      	
              17.4

            	
              English
      language

            

    

     

    All
certificates, instruments and other documents to be delivered under or supplied
in connection with any of the Security Documents shall be in the English
language or shall be accompanied by a certified English translation upon which
the Creditors or any of them shall be entitled to rely.

     

    
      	
              17.5

            	
              Borrowers'
      obligations

            

    

     

    
      	
              17.5.1

            	
              Joint
      and several

            

    

     

    Notwithstanding
anything to the contrary contained in any of the Security Documents, the
agreements, obligations and liabilities of the Borrowers herein contained are
joint and several and shall be construed accordingly.  Each of the
Borrowers agrees and consents to be bound by the Security Documents to which it
is, or is to be, a party notwithstanding that the other Borrower which is
intended to sign or to be bound may not do so or be effectually bound and
notwithstanding that any of the Security Documents may be invalid or
unenforceable against the other Borrower, whether or not the deficiency is known
to any of the Creditors.

     

    
      	
              17.5.2

            	
              Borrowers
      as principal debtors

            

    

     

    Each
Borrower acknowledges and confirms that it is a principal and original debtor in
respect of all amounts which may become payable by the Borrowers in accordance
with the terms of this Agreement or any of the other Security Documents and
agrees that the Creditors may also continue to treat it as such, whether or not
any Creditor is or becomes aware that such Borrower is or has become a surety
for the other Borrower.

     

    
      	
              17.5.3

            	
              Indemnity

            

    

     

    The
Borrowers hereby agree jointly and severally to keep the Creditors fully
indemnified on demand against all damages, losses, costs and expenses arising
from any failure of either Borrower to perform or discharge any purported
obligation or liability of a Borrower which would have been the subject of this
Agreement or any other Security Document had it been valid and enforceable and
which is not or ceases to be valid and enforceable against a Borrower on any
ground whatsoever, whether or not known to a Creditor (including, without
limitation, any irregular exercise or absence of any corporate power or lack of
authority of, or breach of duty by, any person purporting to act on behalf of a
Borrower (or any legal or other limitation, whether under the Limitation Acts or
otherwise or any disability or death, bankruptcy, unsoundness of mind,
insolvency, liquidation, dissolution, winding up, administration, receivership,
amalgamation, reconstruction or any other incapacity of any person whatsoever
(including, in the case of a partnership, a termination or change in the
composition of the partnership) or any change of name or style or constitution
of any Security Party)).

     

    
      
         

      

      
        58

        
          

        

      

      
         

      

    

    
 

     

    
      	
              17.5.4

            	
              Liability
      unconditional

            

    

     

    None of
the obligations or liabilities of the Borrowers under this Agreement or any
other Security Document shall be discharged or reduced by reason
of:

     

    
      	
               
      

            	
              (a)

            	
              the
      death, bankruptcy, unsoundness of mind, insolvency, liquidation,
      dissolution, winding-up, administration, receivership, amalgamation,
      reconstruction or other incapacity of any person whatsoever (including, in
      the case of a partnership, a termination or change in the composition of
      the partnership) or any change of name or style or constitution of a
      Borrower or any other person
liable;

            

    

     

    
      	
               
      

            	
              (b)

            	
              the
      Agent (acting on the instructions of the Majority Banks) or the Security
      Agent granting any time, indulgence or concession to, or compounding with,
      discharging, releasing or varying the liability of, a Borrower or any
      other person liable or renewing, determining, varying or increasing any
      accommodation, facility or transaction or otherwise dealing with the same
      in any manner whatsoever or concurring in, accepting, varying any
      compromise, arrangement or settlement or omitting to claim or enforce
      payment from a Borrower or any other person liable;
  or

            

    

     

    
      	
               
      

            	
              (c)

            	
              anything
      done or omitted which but for this provision might operate to exonerate
      the Borrowers or either of them.

            

    

     

    
      	
              17.5.5

            	
              Recourse
      to other security

            

    

     

    The
Creditors shall not be obliged to make any claim or demand or to resort to any
Security Document or other means of payment now or hereafter held by or
available to it for enforcing this Agreement or any of the Security Documents
against a Borrower or any other person liable and no action taken or omitted by
any Creditor in connection with any such Security Document or other means of
payment will discharge, reduce, prejudice or affect the liability of the
Borrowers under this Agreement and the Security Documents to which either of
them is, or is to be, a party.

     

    
      	
              17.5.6

            	
              Waiver
      of Borrowers' rights

            

    

     

    Each
Borrower agrees with each Creditor that, from the date of this Agreement and so
long as any moneys are owing under any of the Security Documents and while all
or any part of the Total Commitment remains outstanding, it will not, without
the prior written consent of the Agent (acting on the instructions of the
Majority Banks):

     

    
      	
               
      

            	
              (a)

            	
              exercise
      any right of subrogation, reimbursement and indemnity against the other
      Borrower or any other person liable under the Security
      Documents;

            

    

     

    
      	
               
      

            	
              (b)

            	
              demand
      or accept repayment in whole or in part of any Indebtedness now or
      hereafter due to such Borrower from the other Borrower or from any other
      person liable or demand or accept any guarantee, indemnity or other
      assurance against financial loss or any document or instrument created or
      evidencing an Encumbrance in respect of the same or dispose of the
      same;

            

    

     

    
      	
               
      

            	
              (c)

            	
              take
      any steps to enforce any right against any other Borrower or any other
      person liable in respect of any such moneys;
or

            

    

     

    
      
         

      

      
        59

        
          

        

      

      
         

      

    

    
 

     

    
      	
               
      

            	
              (d)

            	
              claim
      any set-off or counterclaim against the other Borrower or any other person
      liable or claiming or proving in competition with any Creditor in the
      liquidation of any other Borrower or any other person liable or have the
      benefit of, or share in, any payment from or composition with, the other
      Borrower or any other person liable or any other Security Document now or
      hereafter held by any Creditor for any moneys owing under this Agreement
      or for the obligations or liabilities of any other person liable but so
      that, if so directed by the Agent, it will prove for the whole or any part
      of its claim in the liquidation of any other Borrower or other person
      liable on terms that the benefit of such proof and all money received by
      it in respect thereof shall be held on trust for the Banks and applied in
      or towards discharge of any moneys owing under this Agreement in such
      manner as the Agent (acting on the instructions of the Majority Banks)
      shall deem appropriate.

            

    

     

    
      	
              18

            	
              Governing
      law and jurisdiction

            

    

     

    
      	
              18.1

            	
              Law

            

    

     

    This
Agreement is governed by, and shall be construed in accordance with, English
law.

     

    
      	
              18.2

            	
              Submission
      to jurisdiction

            

    

     

    The
Borrowers jointly and severally agree, for the benefit of each Creditor, that
any legal action or proceedings arising out of or in connection with this
Agreement against the Borrowers or either of them or any of their assets may be
brought in the English courts.  Each of the Borrowers irrevocably and
unconditionally submits to the jurisdiction of such courts and irrevocably
designates, appoints and empowers Ince & Co at present of International
House, 1 St. Katharine’s Way, London E1W 1AY, England to receive for it and on
its behalf, service of process issued out of the English courts in any such
legal action or proceedings.  The submission to such jurisdiction
shall not (and shall not be construed so as to) limit the right of any Creditor
to take proceedings against either of the Borrowers in the courts of any other
competent jurisdiction nor shall the taking of proceedings in any one or more
jurisdictions preclude the taking of proceedings in any other jurisdiction,
whether concurrently or not.

     

    The
parties further agree that only the courts of England and not those of any other
State shall have jurisdiction to determine any claim which either of the
Borrowers may have against any Creditor arising out of or in connection with
this Agreement.

     

    
      	
              18.3

            	
              Contracts
      (Rights of Third Parties) Act 1999

            

    

     

    No term
of this Agreement is enforceable under the Contracts (Rights of Third Parties)
Act 1999 by a person who is not a party to this Agreement.

     

    IN WITNESS
whereof the parties to this Agreement have caused this Agreement to be duly
executed on the date first above written.

     

    
      
         

      

      
        60

        
          

        

      

      
         

      

    

    
 

     

    Schedule 1

     

    The
Banks and their Commitments

     

    
 

     

    
      	
              Name

            	
              Lending
      Office

            	
              Address
      for Notices

            	
              Commitment

              ($)

               

            
	
               

              DnB
      NOR Bank ASA

            	
               

              20 St.
      Dunstan’s Hill

              London EC3R
      8HY

              England

            	
               

              20 St.
      Dunstan’s Hill

              London EC3R
      8HY

              England

               

              Fax no: 
      +44 207
      626 5956

              Att:         
      Shipping
      Department

               

            	
               

              101,150,000

            
	
              TOTAL
      COMMITMENT

            	
              101,150,000

            

    

    
 

    
      
         

      

      
        61

        
          

        

      

      
         

      

    

    Schedule 2

     

    Form
of Drawdown Notice

     

    (referred
to in clause 2.4)

     

    
 

     

    To: 
      DnB NOR Bank ASA

    20 St Dunstan’s
Hill

    London EC3R
8HY

    England

    (as
Agent)

     

     [·] 200[·]

     

    U.S.$101,150,000
Loan

    Loan
Agreement dated [·]
2007 (the “Loan Agreement”)

     

    We
refer to the above Loan Agreement and hereby give you notice that we wish to
draw down the [Saldanha] [Avoca] Advance, namely $· on
[                      ]
200[·] and select the
first interest period in respect thereof to expire on [·].  The funds
should be credited to [name and
number of account] with [details of bank in New York
City].

     

    We
confirm that:

     

    
      	
              (a)

            	
              no
      event or circumstance has occurred and is continuing which constitutes a
      Default;

            

    

     

    
      	
              (b)

            	
              the representations and warranties contained in (i)
      clauses 7.1, 7.2 and 7.3(b)
      of the Loan Agreement and (ii) clause 4 of the Corporate Guarantee, are
      true and correct at the date hereof as if made with respect to the facts
      and circumstances existing at such
date;

            

    

     

    
      	
              (c)

            	
              the
      borrowing to be effected by the drawdown of the [Saldanha] [Avoca] Advance
      will be within our corporate powers, has been validly authorised by
      appropriate corporate action and will not cause any limit on our
      borrowings (whether imposed by statute, regulation, agreement or
      otherwise) to be exceeded;

            

    

     

    
      	
              (d)

            	
              there
      has been no material adverse change in our business, management, assets,
      operations, results of operations, properties, performances, prospects or
      the condition (financial or otherwise) from that existing on the date of
      the Loan Agreement as described by us or any other Security Party to the
      Agent and/or the Arranger in the negotiation of the Loan Agreement;
      and

            

    

     

    
      	
              (e)

            	
              we
      will use the proceeds of the [Saldanha] [Avoca] Advance for our benefit
      and under our full responsibility and exclusively for the purpose
      specified in the Loan Agreement.

            

    

     

    Words
and expressions defined in the Loan Agreement shall have the same meanings where
used.

     

    
 

    .........................................

    For and
on behalf of

    TEAM-UP
OWNING COMPANY LIMITED

    
 

    
 

    .................................................

    For and
on behalf of

    ORPHEUS
OWNING COMPANY LIMITED

    
      
         

      

      
        62

        
          

        

      

      
         

      

    

    
 

    
 

     

    Schedule 3

     

    Documents
and evidence required as conditions precedent to the Loan being
made

     

    (referred to in clause 9.1)

     

    Part
1

     

    
      	
               
      

            	
              1

            	
              Constitutional
      documents

            

    

     

    copies,
certified by the legal adviser of each Security Party as true, complete and up
to date copies of all documents which contain or establish or relate to the
constitution of that Security Party;

     

    
      	
               
      

            	
              2

            	
              Corporate
      authorisations

            

    

     

    copies
of resolutions of the directors and (except for the Corporate Guarantor) the
shareholders of each Security Party approving such of the Underlying Documents
and the Security Documents to which such Security Party is, or is to be, party
and authorising the signature, delivery and performance of such Security Party's
obligations thereunder, certified (in a certificate dated no earlier than five
(5) Banking Days prior to the date of this Agreement) by an officer of such
Security Party as:

     

    
      	
               
      

            	
              (a)

            	
              being
      true and correct;

            

    

     

    
      	
               
      

            	
              (b)

            	
              being
      duly passed at meetings of the directors of such Security Party and of the
      shareholders of such Security Party each duly convened and
      held;

            

    

     

    
      	
               
      

            	
              (c)

            	
              not
      having been amended, modified or revoked;
and

            

    

     

    
      	
               
      

            	
              (d)

            	
              being
      in full force and effect,

            

    

     

    together
with originals or certified copies of any powers of attorney issued by any such
Security Party pursuant to such resolutions;

     

    
      	
               
      

            	
              3

            	
              Specimen
      signatures

            

    

     

    copies
of the signatures of the persons who have been authorised on behalf of each
Security Party to sign such of the Underlying Documents and the Security
Documents to which such Security Party is, or is to be, party and to give
notices and communications, including notices of drawing, under or in connection
with the Security Documents, certified (in a certificate dated no earlier than
five (5) Banking Days prior to the date of this Agreement) by an officer of such
Security Party as being the true signatures of such persons;

     

    
      	
               
      

            	
              4

            	
              Certificates
      of incumbency

            

    

     

    a list
of directors and officers of each Security Party specifying the names and
positions of such persons, certified (in a certificate dated no earlier than
five (5) Banking Days prior to the date of this Agreement) by the legal adviser
of such Security Party to be true, complete and up to date;

     

    
      
         

      

      
        63

        
          

        

      

      
         

      

    

    
 

     

    
      	
               
      

            	
              5

            	
              Borrowers’
      consents and approvals

            

    

     

    a
certificate (dated no earlier than five (5) Banking Days prior to the date of
this Agreement) from an officer of each of the Borrowers that no consents,
authorisations, licences or approvals are necessary for that Borrower to
authorise or are required by that Borrower in connection with the borrowing by
that Borrower of the Loan pursuant to this Agreement or the execution, delivery
and performance of that Borrower's Security Documents;

     

    
      	
               
      

            	
              6

            	
              Other
      consents and approvals

            

    

     

    a
certificate (dated no earlier than five (5) Banking Days prior to the date of
this Agreement) from an officer of each Security Party (other than the
Borrowers) that no consents, authorisations, licences or approvals are necessary
for such Security Party to guarantee and/or grant security for the borrowing by
the Borrowers of the Total Commitment pursuant to this Agreement and execute,
deliver and perform the Security Documents insofar as such Security Party is a
party thereto;

     

    
      	
               
      

            	
              7

            	
              Due
      diligence

            

    

     

    evidence
that all information required in relation to any Security Party in order for the
Agent and each Bank to complete its due diligence formalities in connection with
this Agreement and the other Security Documents has been provided and is
satisfactory in all respects to the Agent;

     

    
      	
               
      

            	
              8

            	
              Money
      laundering

            

    

     

    such
documentation and other evidence as is reasonably requested by the Agent in
order for each Creditor to carry out and be satisfied with the results of all
necessary "know your client" or other checks which it is required to carry out
in relation to the transactions contemplated by this Agreement and the other
Security Documents and to the identity of any parties to the Security Documents
(other than the Creditors) and their directors and officers;

     

    
      	
               
      

            	
              9

            	
              Certified
      Underlying Documents

            

    

     

    a copy,
certified (in a certificate dated no earlier than (5) five Banking Days prior to
the date of this Agreement) as a true and complete copy by the legal adviser of
each of the Borrowers of each of the Management Agreements and the
Contracts;

     

    
      	
              10

            	
              Marshall
      Islands opinion

            

    

     

    an
opinion of Poles, Tublin, Stratakis, Gonzalez & Weichert, LLP, special legal
advisers on matters of Marshall Islands law to the Agent;

     

    
      	
              11

            	
              Liberian
      opinion

            

    

     

    an
opinion of Poles, Tublin, Stratakis, Gonzalez & Weichert, LLP, special legal
advisers on matters of Liberian law to the Agent;

     

    
      	
              12

            	
              Further
      opinions

            

    

     

    any
such further opinion as may be required by the Agent;

     

    
      	
              13

            	
              Operating
      Accounts

            

    

     

    evidence
that the Operating Accounts have been opened together with mandate forms in
respect thereof and each of them has a credit balance of at least
$10;

     

    
      
         

      

      
        64

        
          

        

      

      
         

      

    

    
 

     

    
      	
              14

            	
              Security
      Documents

            

    

     

    the Fee
Letter, the Master Swap Agreement, the Corporate Guarantee, the Operating
Account Assignments and the Swap Assignment, each duly executed;

     

    
      	
              15

            	
              Fees

            

    

     

    evidence
that any fees and commission due under clause 5.1 have been paid in
full;

     

    
      	
              16

            	
              Borrowers'
      process agent

            

    

     

    a letter from
each Borrower's agent for receipt of service of proceedings referred to in
clause 18.2 accepting its appointment under the said clause and under
each of the other Security Documents in which it is or is to be appointed as
such Borrower's agent; and

     

    
      	
              17

            	
              Security
      Parties’ process agent

            

    

     

    a
letter from each Security Party’s agent for receipt of service of proceedings
accepting its appointment under each of the Security Documents in which it is or
is to be appointed as such Security Party’s agent.

     

    
      
         

      

      
        65

        
          

        

      

      
         

      

    

    Part
2

     

    
      	
               
      

            	
              1

            	
              Ship
      conditions

            

    

     

    Evidence
that the Ship (the “Relevant
Ship”) to which the Advance to be drawn down relates (the “Relevant
Advance”):

     

    
      	
              1.1

            	
              Registration
      and Encumbrances

            

    

     

    is
permanently registered in the name of the relevant Borrower under the laws and
flag of the relevant Flag State through the relevant Registry and that the
Relevant Ship and its Earnings, Insurances and Requisition Compensation (each as
defined in the relevant Ship Security Documents) are free of
Encumbrances;

     

    
      	
              1.2

            	
              Classification

            

    

     

    maintains
the relevant Classification free of all requirements and recommendations of the
relevant Classification Society; and

     

    
      	
              1.3

            	
              Insurance

            

    

     

    is
insured in accordance with the provisions of the relevant Ship Security
Documents and all requirements of such Ship Security Documents in respect of
such insurance have been complied with (including without limitation,
confirmation from the protection and indemnity association or other insurer with
which the Relevant Ship is, or is to be, entered for insurance or insured
against protection and indemnity risks (including oil pollution risks) that any
necessary declarations required by the association or insurer for the removal of
any oil pollution exclusion have been made and that any such exclusion does not
apply to the Relevant Ship);

     

    
      	
               
      

            	
              2

            	
              Ship
      Security Documents

            

    

     

    the
Ship Security Documents for the Relevant Ship, together with the other documents
to be delivered to the Security Agent pursuant thereto, duly
executed;

     

    
      	
               
      

            	
              3

            	
              Title
      and deletion

            

    

     

    evidence
that the transfer of title to the Relevant Ship from the relevant
Seller to the relevant Borrower has been duly recorded at the relevant Registry
free of Encumbrances and that the prior registration of such Ship (if any) in
the name of the relevant Seller has been or within a period of seven (7) days
following the Delivery Date of such Ship, will be cancelled and that no
Encumbrances are registered against such Ship prior register;

     

    
      	
               
      

            	
              4

            	
              Mortgage
      registration

            

    

     

    evidence
that the relevant Mortgage has been permanently registered against the Relevant
Ship under the laws and flag of the relevant Flag State through the relevant
Registry;

     

    
      	
               
      

            	
              5

            	
              Registration
      forms

            

    

     

    such
statutory forms duly signed by the Borrowers and the other Security Parties as
may be required by the Agent to perfect the security contemplated by the
Security Documents;

     

    
      	
               
      

            	
              6

            	
              Notices
      of assignment and acknowledgements

            

    

     

    copies
of duly executed notices of assignment and acknowledgements thereof in the forms
prescribed by the relevant Ship Security Documents in respect of the Relevant
Ship;

     

    
      
         

      

      
        66

        
          

        

      

      
         

      

    

    
 

     

    
      	
               
      

            	
              7

            	
              Marshall
      Islands opinion

            

    

     

    an
opinion of Poles, Tublin, Stratakis, Gonzalez & Weichert, LLP, special legal
advisers on matters of Marshall Islands law to the Agent;

     

    
      	
               
      

            	
              8

            	
              Liberian
      opinion

            

    

     

    an
opinion of Poles, Tublin, Stratakis, Gonzalez & Weichert, LLP, special legal
advisers on matters of Liberian law to the Agent;

     

    
      	
               
      

            	
              9

            	
              Maltese
      opinion

            

    

     

    an
opinion of Ganado & Associates, special legal advisers on matters of Maltese
law to the Agent;

     

    
      	
              10

            	
              Further
      opinions

            

    

     

    any
such further opinion as may be required by the Agent;

     

    
      	
              11

            	
              Insurance
      opinion

            

    

     

    an
opinion from insurance consultants to the Agent on the insurances effected or to
be effected in respect of the Relevant Ship upon and following the relevant
Drawdown Date of the Relevant Advance in form and substance satisfactory to the
Agent;

     

    
      	
              12

            	
              Bill
      of sale and delivery documents

            

    

     

    a copy,
certified as a true and complete copy by an officer or a legal advisor of the
Borrowers, of a duly executed and notarised/legalised bill of sale in respect of
the Relevant Ship evidencing the full Contract Price for the Relevant Ship and
the other delivery documents duly executed and exchanged pursuant to the
relevant Contract;

     

    
      	
              13

            	
              Readiness
      and payment of Contract Price

            

    

     

    evidence
that the Relevant Ship is in all respects ready for delivery pursuant to the
relevant Contract and that the relevant Contract Price for the Relevant Ship has
been paid in full;

     

    
      	
              14

            	
              ISPS
      Code compliance

            

    

     

    
      	
              14.1

            	
              evidence
      satisfactory to the Agent that the Relevant Ship is subject to a ship
      security plan which complies with the ISPS Code;
  and

            

    

     

    
      	
              14.2

            	
              a
      copy certified (in a certificate dated no later than seven (7) Banking
      Days after the Delivery Date of the Relevant Ship) as a true and complete
      copy by an officer or a legal advisor of the Borrowers
      of the ISSC for the Relevant Ship and the continuous synopsis record
      required by the ISPS Code in respect of the Relevant
  Ship;

            

    

     

    
      	
              15

            	
              SMC/DOC

            

    

     

    a copy,
certified (in a certificate dated no later than seven (7) Banking Days after the
Delivery Date of the Relevant Ship) as a true and complete copy by an officer of
the Borrowers of the DOC issued to the Operator of the Relevant Ship and the SMC
for the Relevant Ship;

     

    
      
         

      

      
        67

        
          

        

      

      
         

      

    

    
 

     

    
      	
              16

            	
              Valuation

            

    

     

    a
valuation of the Relevant Ship, made (at the cost of the Borrowers) by an
Approved Shipbroker nominated by the Borrowers (or, failing this, by the Agent)
and appointed by the Agent, demonstrating the market value of such Ship, on the
basis and in the manner set out in clause 8.2.2; and

     

    
      	
              17

            	
              Further
      matters/conditions

            

    

     

    any
such other matter or conditions as may be required by the Agent.

     

    
      
         

      

      
        68

        
          

        

      

      
         

      

    

    Schedule 4

     

    Form
of Transfer Certificate

     

    (referred
to in clause 15.3)

    
 

    
 

    TRANSFER
CERTIFICATE

     

    Banks
are advised not to employ Transfer Certificates or otherwise to assign or
transfer interests in the Loan Agreement without further ensuring that the
transaction complies with all applicable laws and regulations, including the
Financial Services and Markets Act 2000 and regulations made thereunder and
similar statutes which may be in force in other jurisdictions

     

    
      	
              To:

            	
              DNB
      NOR BANK ASA as agent on its own behalf and on behalf of the Borrowers,
      the Account Bank, the Security Agent, the Arranger, the Swap Provider and
      the Banks defined in the Loan Agreement referred to
  below.

            

    

     

    [Date]

     

    Attention:                      [·]

     

    This
certificate (“Transfer
Certificate”) relates to a loan agreement dated [·] December 2007 (the “Loan Agreement”) and made
between (1) Team-Up Owning Company Limited and Orpheus Owning Company Limited as
joint and several borrowers (the “Borrowers”), (2) the banks and
financial institutions set out in schedule 1 thereto as banks (the “Banks”) and (3) DnB NOR Bank
ASA as Arranger, Agent, Security Agent, Swap Provider and Account Bank, in
relation to a loan of up to $101,150,000.  Terms defined in the Loan
Agreement shall, unless otherwise defined herein, have the same meanings herein
as therein.

     

    In this
Certificate:

     

    the
“Transferor” means
[full name] of [lending office];
and

     

    the
“Transferee” means
[full name] of [lending office].

     

    
      	
               
      

            	
              1

            	
              The
      Transferor with full title guarantee assigns to the Transferee absolutely
      all rights and interests (present, future or contingent) which the
      Transferor has as a Bank under or by virtue of the Loan Agreement and all
      the Security Documents in relation to that part of the [Contribution]
      [Available Commitment] of the Transferor (or its predecessors in title)
      details of which are set out below:

            

    

     

    
      	
               

              Date
      of Advances

            	
               

              Amount
      of Advance

            	
               

              Transferor’s
      [Contribution] [Available Commitment]

              to
      Advance

               

            	
               

              Maturity
      Date

            
	 
      	 
      	 
      	 
      

    

    
 

    
      	
               
      

            	
              2

            	
              By
      virtue of this Transfer Certificate and clause 15 of the Loan
      Agreement, the Transferor is discharged [entirely from its [Contribution]
      [Commitment] which amounts to
      $[          ]] [from
      [   ] per cent ([   ]%) of its
      [Contribution] [Commitment] in respect of both Advances], which percentage
      represents
      $[          ]].

            

    

     

    
      
         

      

      
        69

        
          

        

      

      
         

      

    

    
 

     

    
      	
               
      

            	
              3

            	
              The
      Transferee hereby requests the Borrowers, the Agent (on behalf of itself,
      the Account Bank, the Arranger, the Security Agent, the Swap Provider and
      the Banks) to accept the executed copies of this Transfer Certificate as
      being delivered pursuant to and for the purposes of clause 15.3 of
      the Loan Agreement so as to take effect in accordance with the terms
      thereof on [date of
      transfer].

            

    

     

    
      	
               
      

            	
              4

            	
              The
      Transferee:

            

    

     

    
      	
              4.1

            	
              confirms
      that it has received a copy of the Loan Agreement and the other Security
      Documents together with such other documents and information as it has
      required in connection with the transaction contemplated
      thereby;

            

    

     

    
      	
              4.2

            	
              confirms
      that it has not relied and will not hereafter rely on the Transferor, the
      Agent, the Security Agent, the Swap Provider, the Arranger, the Account
      Bank or the other Banks to check or enquire on its behalf into the
      legality, validity, effectiveness, adequacy, accuracy or completeness of
      the Loan Agreement, any of the Security Documents or any such documents or
      information;

            

    

     

    
      	
              4.3

            	
              agrees
      that it has not relied and will not rely on the Transferor, the Agent, the
      Security Agent, the Arranger, the Account Bank, the Swap Provider or the
      Banks to assess or keep under review on its behalf the financial
      condition, creditworthiness, condition, affairs, status or nature of the
      Borrowers or either of them or any other Security Party (save as otherwise
      expressly provided therein);

            

    

     

    
      	
              4.4

            	
              warrants
      that it has power and authority to become a party to the Loan Agreement
      and has taken all necessary action to authorise execution of this Transfer
      Certificate and to obtain all necessary approvals and consents to the
      assumption of its obligations under the Loan Agreement and the Security
      Documents; and

            

    

     

    
      	
              4.5

            	
              if
      not already a Bank, appoints (i) the Agent to act as its agent and (ii)
      the Security Agent to act as its security agent and trustee, in each case
      as provided in the Loan Agreement and the Security Documents and agrees to
      be bound by the terms of the Loan Agreement and the other Security
      Documents.

            

    

     

    
      	
               
      

            	
              5

            	
              The
      Transferor:

            

    

     

    
      	
              5.1

            	
              warrants
      to the Transferee that it has full power to enter into this Transfer
      Certificate and has taken all corporate action necessary to authorise it
      to do so;

            

    

     

    
      	
              5.2

            	
              warrants
      to the Transferee that this Transfer Certificate is binding on the
      Transferor under the laws of England, the country in which the Transferor
      is incorporated and the country in which its lending office is located;
      and

            

    

     

    
      	
              5.3

            	
              agrees
      that it will, at its own expense, execute any documents which the
      Transferee reasonably requests for perfecting in any relevant jurisdiction
      the Transferee’s title under this Transfer Certificate or for a similar
      purpose.

            

    

     

    
      	
               
      

            	
              6

            	
              The
      Transferee hereby undertakes with the Transferor and each of the other
      parties to the Loan Agreement and the other Security Documents that it
      will perform in accordance with its terms all those obligations which by
      the terms of the Loan Agreement and the other Security Documents will be
      assumed by it after delivery of the executed copies of this Transfer
      Certificate to the Agent and satisfaction of the conditions (if any)
      subject to which this Transfer Certificate is expressed to take
      effect.

            

    

     

    
      
         

      

      
        70

        
          

        

      

      
         

      

    

    
 

     

    
      	
               
      

            	
              7

            	
              By
      execution of this Transfer Certificate on their behalf by the Agent and in
      reliance upon the representations and warranties of the Transferee, the
      Borrowers, the Account Bank, the Arranger, the Security Agent, the Swap
      Provider and the Banks accept the Transferee as a party to the Loan
      Agreement and the Security Documents with respect to all those rights
      and/or obligations which by the terms of the Loan Agreement and the
      Security Documents will be assumed by the Transferee (including those
      about pro-rata sharing and the exclusion of liability on the part of, and
      the indemnification of, the Agent, the Arranger, the Account Bank, the
      Swap Provider and the Security Agent as provided by the Loan Agreement)
      after delivery of the executed copies of this Transfer Certificate to the
      Agent and satisfaction of the conditions (if any) subject to which this
      Transfer Certificate is expressed to take
  effect.

            

    

     

    
      	
               
      

            	
              8

            	
              None
      of the Transferor, the Agent, the Security Agent, the Account Bank, the
      Arranger, the Swap Provider or the
Banks:

            

    

     

    
      	
              8.1

            	
              makes
      any representation or warranty nor assumes any responsibility with respect
      to the legality, validity, effectiveness, adequacy or enforceability of
      the Loan Agreement or any of the Security Documents or any document
      relating thereto; or

            

    

     

    
      	
              8.2

            	
              assumes
      any responsibility for the financial condition of the Borrowers or either
      of them or any other Security Party or any party to any such other
      document or for the performance and observance by the Borrowers or either
      of them or any other Security Party or any party to any such other
      document (save as otherwise expressly provided therein) and any and all
      such conditions and warranties, whether express or implied by law or
      otherwise, are hereby excluded (except as
  aforesaid).

            

    

     

    
      	
               
      

            	
              9

            	
              The
      Transferor and the Transferee each undertake that they will on demand
      fully indemnify the Agent in respect of any claim, proceeding, liability
      or expense which relates to or results from this Transfer Certificate or
      any matter concerned with or arising out of it unless caused by the
      Agent’s gross negligence or wilful misconduct, as the case may
      be.

            

    

     

    
      	
               
      

            	
              10

            	
              The
      agreements and undertakings of the Transferee in this Transfer Certificate
      are given to and for the benefit of and made with each of the other
      parties to the Loan Agreement and the Security
  Documents.

            

    

     

    
      	
               
      

            	
              11

            	
              This
      Transfer Certificate is governed by, and shall be construed in accordance
      with, English law.

            

    

     

    
      	
              Transferor

            	
              Transferee

            
	
               

              By:
      ......................................................

            	
               

              By:
      ......................................................

            
	
               

              Dated:
      ...................................................

            	
               

              Dated:
      ...................................................

            

    

    Agent

     

    Agreed
for and on behalf of itself as Agent, the Borrowers, the Security Agent, the
Account Bank, the Arranger, the Swap Provider and the Banks.

     

    DNB
NOR BANK ASA

     

    By:                      .............................................

     

    Dated:                      .............................................

     

    Note:                      The
execution of this Transfer Certificate alone may not transfer a proportionate
share of the Transferor’s interest in the security constituted by the Security
Documents in the Transferor’s or Transferee’s jurisdiction.  It is the
responsibility of the Transferee to ascertain whether any other documents are
required to perfect a transfer of such a share in the Transferor’s interest in
such security in any such jurisdiction and, if so, to seek appropriate advice
and arrange for execution of the same.

     

    
      
         

      

      
        71

        
          

        

      

      
         

      

    

    The
Schedule

     

    
 

     

    Outstanding
Contribution: $•

    Available
Commitment: $•

    Portion
Transferred: •%

     

    
 

     

    Administrative
Details of Transferee

     

    Name of
Transferee:

    Lending
Office:

    Contact
Person

    (Loan
Administration Department):

     

    Telephone:

    Telefax
No:

     

    Contact
Person:

     

    (Credit
Administration Department):

    Telephone:

    Telefax
No:

     

    Account
for payments:

     

    
      
         

      

      
        72

        
          

        

      

      
         

      

    

    
 

     

    Schedule 5

     

    Form
of Trust Deed

     

     

     

    THIS
DECLARATION OF TRUST made by DNB
NOR BANK ASA (the “Security
Agent”) is made on [·] 2007 and
is supplemental to (and made pursuant to the terms of) a Loan Agreement dated
[·]
2007 (the “Agreement”)
and made between (1) Team-Up Owning Company Limited and Orpheus Owning Company
Limited as joint and several Borrowers, (2) the banks and financial institutions
mentioned in schedule 1 to the Agreement as the Banks and (3) DnB NOR Bank ASA
as Arranger, Agent, Security Agent, Swap Provider and Account
Bank.  Words and expressions defined in the Agreement shall have the
same meaning when used in this Deed.

     

    NOW
THIS DEED WITNESSETH as follows:

     

    
      	
              1

            	
              The
      Security Agent hereby acknowledges and declares that, from the date of
      this Deed, it holds and shall hold the Trust Property on trust for the
      Banks, the Agent and the Swap Provider on the terms and basis set out in
      the Agreement.

            

    

     

    
      	
              2

            	
              The
      declaration and acknowledgement contained in paragraph 1 above shall
      be irrevocable.

            

    

     

    IN WITNESS
whereof the Security Agent has executed this Deed the day and year first
above written.

     

    

      
        	
                SIGNED. SEALED and DELIVERED

              	
                )

              	 
      	 
      
	
                as
      a DEED

              	
                )

              	 
      	 
      
	
                by

              	
                )

              	
                Attorney-in-fact

              	 
      
	
                for
      and on behalf of

              	
                )

              	 
      	 
      
	DNB
      NOR BANK ASA 	
                ) 

              	 	 
	(as
      Security Agent) 	) 	 	 

      

      
        
           

        

        
          73

          
            

          

        

        
           

        

      

    Schedule 6

     

    Mandatory
Cost formula

     

    
      	
              1

            	
              The
      Mandatory Cost is an addition to the interest rate to compensate Banks for
      the cost of compliance with (a) the requirements of the Bank of England
      and/or the Financial Services Authority (or, in either case, any other
      authority which replaces all or any of its functions) or (b) the
      requirements of the European Central
Bank.

            

    

     

    
      	
              2

            	
              On
      the first day of each Interest Period (or as soon as possible thereafter)
      the Agent shall calculate, as a percentage rate, a rate (the "Additional Cost Rate")
      for each Bank, in accordance with the paragraphs set out
      below.  The Mandatory Cost will be calculated by the Agent as a
      weighted average of the Banks' Additional Cost Rates (weighted in
      proportion to the percentage participation of each Bank in the Loan or any
      relevant unpaid sum) and will be expressed as a percentage rate per
      annum.

            

    

     

    
      	
              3

            	
              The
      Additional Cost Rate for any Bank lending from a lending office in a
      Participating Member State will be the percentage notified by that Bank to
      the Agent.  This percentage will be certified by that Bank in
      its notice to the Agent to be its reasonable determination of the cost
      (expressed as a percentage of that Bank's participation in the Loan or the
      relevant unpaid sum made from that lending office) of complying with the
      minimum reserve requirements of the European Central Bank in respect of
      loans made from that lending
office.

            

    

     

    
      	
              4

            	
              The
      Additional Cost Rate for any Bank lending from a lending office in the
      United Kingdom will be calculated by the Agent as
  follows:

            

    

     

    

     

    Where
E is designed to
compensate Banks for amounts payable under the Fees Rules and is calculated by
the Agent as being the average of the most recent rates of charge supplied by
the Reference Banks to the Agent pursuant to paragraph 6 below and expressed in
pounds per £1,000,000.

     

    
      	
              5

            	
              For
      the purposes of this Schedule:

            

    

     

    
      	
               
      

            	
              (a)

            	
              "Fees Rules" means the
      rules on periodic fees contained in the FSA Supervision Manual or such
      other law or regulation as may be in force from time to time in respect of
      the payment of fees for the acceptance of
  deposits;

            

    

     

    
      	
               
      

            	
              (b)

            	
              "Fee Tariffs" means the
      fee tariffs specified in the Fees Rules under the activity group A.1
      Deposit acceptors (ignoring any minimum fee or zero rated fee required
      pursuant to the Fees Rules but taking into account any applicable discount
      rate);

            

    

     

    
      	
               
      

            	
              (c)

            	
              “Participating Member
      State” means any member of the European Union that adopts or has
      adopted the euro as its lawful currency in accordance with the legislation
      of the European Community relating to the Economic and Monetary
      Union;

            

    

     

    
      	
               
      

            	
              (d)

            	
              "Special Deposits" has
      the meaning given to it from time to time under or pursuant to the Bank of
      England Act 1998 or (as may be appropriate) by the Bank of England;
      and

            

    

     

    
      	
               
      

            	
              (e)

            	
              "Tariff Base" has the
      meaning given to it in, and will be calculated in accordance with, the
      Fees Rules.

            

    

     

    
      
         

      

      
        74

        
          

        

      

      
         

      

    

    
 

     

    
      	
              6

            	
              If
      requested by the Agent, each Reference Bank shall, as soon as practicable
      after publication by the Financial Services Authority, supply to the
      Agent, the rate of charge payable by that Reference Bank to the Financial
      Services Authority pursuant to the Fees Rules in respect of the relevant
      financial year of the Financial Services Authority (calculated for this
      purpose by that Reference Bank as being the average of the Fee Tariffs
      applicable to that Reference Bank for that financial year) and expressed
      in pounds per £1,000,000 of the Tariff Base of that Reference
      Bank.

            

    

     

    
      	
              7

            	
              Each
      Bank shall supply any information required by the Agent for the purpose of
      calculating its Additional Cost Rate.  In particular, but
      without limitation, each Bank shall supply the following information on or
      prior to the date on which it becomes a
Bank:

            

    

     

    
      	
               
      

            	
              (a)

            	
              the
      jurisdiction of its lending office;
and

            

    

     

    
      	
               
      

            	
              (b)

            	
              any
      other information that the Agent may reasonably require for such
      purpose.

            

    

     

    Each
Bank shall promptly notify the Agent of any change to the information provided
by it pursuant to this paragraph.

     

    
      	
              8

            	
              The
      rates of charge of each Reference Bank for the purpose of E above shall be
      determined by the Agent based upon the information supplied to it pursuant
      to paragraphs 6 and 7 above and on the assumption that, unless a Bank
      notifies the Agent to the contrary, each Bank's obligations in relation to
      cash ratio deposits and Special Deposits are the same as those of a
      typical bank from its jurisdiction of incorporation with a lending office
      in the same jurisdiction as its lending
office.

            

    

     

    
      	
              9

            	
              The
      Agent shall have no liability to any person if such determination results
      in an Additional Cost Rate which over or under compensates any Bank and
      shall be entitled to assume that the information provided by any Bank or
      Reference Bank pursuant to paragraphs 3, 6 and 7 above is true and correct
      in all respects.

            

    

     

    
      	
              10

            	
              The
      Agent shall distribute the additional amounts received as a result of the
      Mandatory Cost to the Banks on the basis of the Additional Cost Rate for
      each Bank based on the information provided by each Bank and each
      Reference Bank pursuant to paragraphs 3, 6 and 7
  above.

            

    

     

    
      	
              11

            	
              Any
      determination by the Agent pursuant to this schedule in relation to a
      formula, the Mandatory Cost, an Additional Cost Rate or any amount payable
      to a Bank shall, in the absence of manifest error, be conclusive and
      binding on all parties to this
Agreement.

            

    

     

    
      	
              12

            	
              The
      Agent may from time to time, after consultation with the Borrower and the
      Banks, determine and notify to all parties to this Agreement any
      amendments which are required to be made to this schedule in order to
      comply with any change in law, regulation or any requirements from time to
      time imposed by the Bank of England, the Financial Services Authority or
      the European Central Bank (or, in any case, any other authority which
      replaces all or any of its functions) and any such determination shall, in
      the absence of manifest error, be conclusive and binding on all parties to
      this Agreement.

            

    

     

    
      
         

      

      
        75

        
          

        

      

      
         

      

    

    
 

     

    Schedule 7

     

    Form
of Mortgage

     

    
      
         

      

      
        76

        
          

        

      

      
         

      

    

    
 

     

    Schedule 8

     

    Form
of Deed of Covenant

     

    
 

    
      
         

      

      
        77

        
          

        

      

      
         

      

    

    
 

    Schedule 9

     

    Form
of Corporate Guarantee

     

    
      
         

      

      
        78

        
          

        

      

      
         

      

    

    
 

    Schedule 10

     

    Form
of Manager’s Undertakings

     

    
 

    
 

    
      
         

      

      
        79

        
          

        

      

      
         

      

    

    
 

    Schedule 11

     

    Form
of Master Swap Agreement

     

    
 

    
 

    
      
         

      

      
        80

        
          

        

      

      
         

      

    

    
 

    Schedule 12

     

    Form
of Swap Assignment

     

    
      
         

      

      
        81

        
          

        

      

      
         

      

    

    
 

    Schedule 13

     

    Form
of Operating Account Assignment

     

    
 

    
 

    
      
         

      

      
        82

        
          

        

      

      
         

      

    

    

      
        	
                SIGNED
by

              	
                )

              	 
      	 
      
	
                for
      and on behalf of

              	
                )

              	 
      	 
      
	
                TEAM-UP
      OWNING COMPANY LIMITED

              	
                )

              	
                Attorney-in-fact

              	 
      
	
                as
      Borrower

              	
                )

              	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	
                SIGNED
by

              	
                )

              	 
      	 
      
	
                for
      and on behalf of

              	
                )

              	 
      	 
      
	
                ORPHEUS
      OWNING COMPANY LIMITED

              	
                )

              	
                Attorney-in-fact

              	 
      
	
                as
      Borrower

              	
                )

              	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	
                SIGNED
by

              	
                )

              	 
      	 
      
	
                for
      and on behalf of

              	
                )

              	 
      	 
      
	
                DNB
      NOR BANK ASA

              	
                )

              	
                Attorney-in-fact

              	 
      
	
                as
      Arranger, Agent, Security Agent,

              	
                )

              	 
      	 
      
	
                Swap
      Provider and Account Bank

              	
                )

              	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	
                SIGNED
by

              	
                )

              	 
      	 
      
	
                for
      and on behalf of

              	
                )

              	 
      	 
      
	
                DNB
      NOR BANK ASA

              	
                )

              	
                Attorney-in-fact

              	 
      
	
                as
      Bank

              	
                )

              	 
      	 
      

      

     

    
      
         

      

      
        83

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00139-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00139-of-00352.parquet"}]]