Document:

Exhibit 4.7

 

Conformed copy

 

 

DATED: 30 March 2004

 

 

STOLT-NIELSEN TRANSPORTATION GROUP LTD.

(as borrower)

 

- and -

 

STOLT-NIELSEN S.A.

(as guarantor)

 

- and -

 

DEUTSCHE BANK AG IN HAMBURG

SCHIFFSHYPOTHEKENBANK ZU LUBECK AG

and

DVB BANK AG

(as lead arrangers)

 

- and -

 

CREDIT AGRICOLE INDOSUEZ

and

KfW

(as arrangers)

 

- and -

DEUTSCHE SCHIFFSBANK AG

(as co-arranger)

 

- and -

 

THE BANKS LISTED IN SCHEDULE 1

(as banks)

 

- and -

 

SCHIFFSHYPOTHEKENBANK ZU LUBECK AG

(as facility agent and as security trustee)

 

 

US$130,000,000 SECURED

REVOLVING LOAN

FACILITY AGREEMENT

 

 

 

CONTENTS

 

	
  1

  	
  Definitions and Interpretation

  	
   

  
	
   

  	
   

  	
   

  
	
  2

  	
  The Facility and its Purpose

  	
   

  
	
   

  	
   

  	
   

  
	
  3

  	
  Conditions Precedent and Subsequent

  	
   

  
	
   

  	
   

  	
   

  
	
  4

  	
  Representations and Warranties

  	
   

  
	
   

  	
   

  	
   

  
	
  5

  	
  Repayment and Prepayment

  	
   

  
	
   

  	
   

  	
   

  
	
  6

  	
  Interest

  	
   

  
	
   

  	
   

  	
   

  
	
  7

  	
  Guarantee and Indemnity

  	
   

  
	
   

  	
   

  	
   

  
	
  8

  	
  Fees

  	
   

  
	
   

  	
   

  	
   

  
	
  9

  	
  Security Documents

  	
   

  
	
   

  	
   

  	
   

  
	
  10

  	
  Agency
  and Trust

  	
   

  
	
   

  	
   

  	
   

  
	
  11

  	
  Covenants

  	
   

  
	
   

  	
   

  	
   

  
	
  12

  	
  Earnings

  	
   

  
	
   

  	
   

  	
   

  
	
  13

  	
  Events
  Of Default

  	
   

  
	
   

  	
   

  	
   

  
	
  14

  	
  Set-Off
  and Lien

  	
   

  
	
   

  	
   

  	
   

  
	
  15

  	
  Assignment and Sub-Participation

  	
   

  
	
   

  	
   

  	
   

  
	
  16

  	
  Payments, Mandatory Prepayment, Reserve
  Requirements and Illegality

  	
   

  
	
   

  	
   

  	
   

  
	
  17

  	
  Communications

  	
   

  
	
   

  	
   

  	
   

  
	
  18

  	
  General Indemnities

  	
   

  
	
   

  	
   

  	
   

  
	
  19

  	
  Miscellaneous

  	
   

  
	
   

  	
   

  	
   

  
	
  20

  	
  Law and Jurisdiction

  	
   

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 1

  	
   

  
	
   

  	
  The Banks, the Commitments and the
  Proportionate Shares

  	
   

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 2

  	
   

  
	
   

  	
  Lead
  Arrangers

  	
   

  

 

 

	
  SCHEDULE 3

  	
   

  
	
   

  	
  The Shipowning Guarantors and the Vessels

  	
   

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 4

  	
   

  
	
   

  	
  Form of Compliance Certificate

  	
   

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 5

  	
   

  
	
   

  	
  Form of Transfer Certificate

  	
   

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 6

  	
   

  
	
   

  	
  PART A

  	
   

  
	
   

  	
  Notice of Assignment

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX A

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX B

  	
   

  
	
   

  	
  Mandatory Cost Formulae

  	
   

  

 

 

FACILITY AGREEMENT

 

Dated:            30 March 2004

 

BETWEEN:-

 

(1)           STOLT-NIELSEN
TRANSPORTATION GROUP LTD. which is a company incorporated according to the law
of Liberia with its registered office at 80 Broad Street, Monrovia, Liberia
(the “Borrower”); and

 

(2)           STOLT-NIELSEN
S.A. which is a company incorporated according to the law of Luxembourg with
its registered office at 23 avenue Monterey, L-2086 Luxembourg (“SNSA”); and

 

(3)           the
banks and financial institutions listed in Schedule 1, each acting through its
office at the address indicated against its name in Schedule 1 (together “the
Banks” and each a “Bank”); and

 

(4)           SCHIFFSHYPOTHEKENBANK
ZU LUBECK AG acting as facility agent through its office at Brandstwiete 1,
D-20457, Hamburg, Federal Republic of Germany (in that capacity “the Agent”);
and

 

(5)           SCHIFFSHYPOTHEKENBANK
ZU LUBECK AG acting as security trustee through its office at Brandstwiete 1,
D-20457, Hamburg, Federal Republic of Germany (in that capacity the “Security
Trustee”); and

 

(6)           the
banks and financial institutions listed in Schedule 2 Part A, each acting as a
joint lead arranger through its office at the address indicated against its
name in Schedule 2 Part A (together in that capacity the “Lead Arrangers” and
each a “Lead Arranger”); and

 

(7)           the
banks and financial institutions listed in Schedule 2 Part B, each acting as a
joint arranger through its office at the address indicated against the name in
Schedule 2 Part B (together in that capacity the “Arrangers” and each an
“Arranger”); and

 

(8)           DEUTSCHE
SCHIFFSBANK AG acting as co-arranger through its office at Domshof 17, 28195
Bremen, Federal Republic of Germany (in that capacity the “Co Arranger”).

 

 

WHEREAS:-

 

(A)          Each
of the Vessels is registered in the name and ownership of her Shipowning
Guarantor under the flag of the country indicated in Schedule 3.

 

(B)           Each
of the Banks has agreed to advance to the Borrower its respective Commitment of
an aggregate principal amount not exceeding the lesser of one hundred and
thirty million Dollars ($130,000,000) and sixty five per cent (65%) of the Fair
Market Value for all Vessels for the purpose of (i) refinancing the Existing
Facility and (ii) the Borrower’s general corporate purposes.

 

IT IS AGREED as follows:-

 

1              Definitions and Interpretation

 

1.1           Definitions

 

In this Agreement:-

 

1.1.1        “Accepted Broker” means such of P.F. Bass0e
A.S. & Co., R.S. Platou Shipbrokers a.s., Fearnleys A/S and Inge Steensland
AS or such other reputable independent broker as may be acceptable to an
Instructing Group acting in its absolute discretion.

 

1.1.2        “the Address for Service” means c/o
Stolt-Nielsen Limited, 71-91 Aldwych, London WC2B 4HN or, in relation to any of
the Security Parties, such other address in England and Wales as that Security
Party may from time to time designate by no fewer than ten Business Days’
written notice to the Agent.

 

1.1.3        “the Administration” has the meaning given to
it in paragraph 1.1.3 of the ISM Code.

 

1.1.4        the “Advance Date”, in relation to any Drawing,
means the date on which that Drawing is advanced by the Banks to the Borrower
pursuant to Clause 2.

 

2

 

1.1.5        “the Assignments” means the deeds of assignment
of the Insurances, Earnings and Requisition Compensation in respect of each
Vessel referred to in Clause 9.2 (each an “Assignment”).

 

1.1.6        “the Borrower’s Obligations” means all of the
liabilities and obligations of the Borrower to the Finance Parties under or
pursuant to the Borrower’s Security Documents, whether actual or contingent,
present or future, and whether incurred alone or jointly or jointly and
severally with any other and in whatever currency, including (without
limitation) interest, commission and all other charges and expenses.

 

1.1.7        “the Borrower’s Security Documents” means those
of the Security Documents to which the Borrower is or is to be a party.

 

1.1.8        “Break Costs” means all documented costs,
losses, premiums or penalties incurred by any of the Finance Parties in the
circumstances contemplated by Clause 18.4 or as a result of any of them
receiving any prepayment of all or any part of the Facility (whether pursuant
to Clause 5.2 or otherwise) or any other payment under or in relation to the
Security Documents on a day other than the due date for payment of the sum in
question, and includes (without limitation) any losses or costs incurred in
liquidating or re-employing deposits from third parties acquired to effect or
maintain the Facility, and any liabilities, expenses or losses incurred by any
of the Finance Parties in terminating or reversing, or otherwise in connection
with, any interest rate and/or currency swap, transaction or arrangement
entered into by any of the Finance Parties to hedge any exposure arising under
this Agreement, or in terminating or reversing, or otherwise in connection
with, any open position arising under this Agreement.

 

1.1.9        “Business Day” means a day on which banks are
open for the transaction of business of the nature contemplated by this
Agreement (and not authorised by law to close) in New York City, United States
of America; London, England; and Hamburg, Federal Republic of Germany.

 

3

 

1.1.10      “Cash” means cash at bank or in hand which is not
subject to any charge back or other Encumbrance and to which SNSA has free,
immediate and direct access.

 

1.1.11      “Cash Equivalents” means the following where SNSA
has free, immediate and direct access:

 

(a)   any security issued directly or fully guaranteed or
insured by the United States of America or any OECD government whose securities
are readily marketable in London, Paris, Frankfurt or New York City, or any
agency or instrumentality thereof;

 

(b)   other readily marketable securities or other easily
realisable investments having a rating of at least A from Standard and Poor’s
Ratings Group or Moody’s Investors Service, Inc;

 

(c)   any Eurodollar time deposit, overnight deposit or
banker’s acceptance, issued by, or time deposit of a commercial banking
institution which has, on a combined basis, capital, surplus and undivided
profit of not less than $250,000,000 and has a Moody’s Bank Credit Service
rating for short term bank deposits of at least P2;

 

(d)   repurchase obligations with a term of not more than
ninety (90) days for underlying securities of the types described in paragraph
(a) above entered into with any commercial banking institution meeting the qualifications
specified in paragraph (c) above;

 

(e)   short term commercial paper issued by any person,
having one of the top two investment ratings from either Standard & Poor’s
Ratings Group or Moody’s Investors Service, Inc;

 

(f)    investments in money market funds substantially all
of whose assets are comprised of securities of the types described in
paragraphs (a) to (e) above; and

 

4

 

(g)   deposits which are unrestricted as to withdrawal
with commercial banking institutions meeting the criteria set forth in
paragraph (c) above.

 

1.1.12      “Certificate of Compliance” means a certificate
materially in the form set forth in Schedule 4, signed by the finance director
or senior finance officer of SNSA.

 

1.1.13      “Closing Date” means the earlier to occur of the
Execution Date and 31 March 2004.

 

1.1.14      “Commitment” means, in relation to each Bank, the
amount of the Facility which that Bank agrees to advance to the Borrower as its
several liability pursuant to Clause 2, as indicated against the name of that
Bank in Schedule 1, as reduced from time to time in accordance with Clause
2.4.5 and the amount of any other Commitment transferred to it under this
Agreement.

 

1.1.15      “Commitment Commission” means the commitment
commission to be paid by the Borrower to the Agent pursuant to Clause 8.2.

 

1.1.16      a “Communication” means any notice, approval,
demand, request or other communication from one party to this Agreement to any
other party to this Agreement.

 

1.1.17      “the Communications Address” means c/o
Stolt-Nielsen Limited, 71-91 Aldwych, London WC2B 4HN, England, fax no: +(44)
207 611 89 65 marked for the attention of Chief Operating Officer.

 

1.1.18      “the Company” means, in relation to any Vessel
and at any given time, the company responsible for the Vessel’s compliance with
the ISM Code pursuant to paragraph 1.1.2 of the ISM Code.

 

1.1.19      “Consolidated Debt” means for SNSA and its
Subsidiaries (on a consolidated basis) at any time, the aggregate value of (i)
moneys borrowed, plus (ii) notes payable (whether promissory notes or
otherwise), plus (iii) amounts raised by acceptance under any acceptance credit
facility, plus (iv) amounts raised pursuant to any note purchase

 

5

 

facility or the issue of bonds,notes,
debentures or similar instruments, plus (v) the amount of any liability in
respect of lease or hire purchase obligations which, according to US GAAP,
would be treated as finance or capital leases, plus (vi) all contingent liabilities,
including guarantee obligations, related to debt and capital lease obligations
of third parties which, according to US GAAP, are considered probable and
estimable, plus (vii) subordinated debt, less (viii) the amount of that part of
any financial indebtedness for which there is a blocked or restricted cash
deposit which will repay such part of such financial indebtedness.

 

1.1.20      “Consolidated Interest Expense” means, for SNSA
and its Subsidiaries (on a consolidated basis) for the most recent four fiscal
quarters of SNSA, interest expense (including the interest component of any
capital lease obligations) on all Consolidated Debt, determined in accordance
with US GAAP.

 

1.1.21      “Consolidated EBITDA” means, for SNSA and its
Subsidiaries (on a consolidated basis) the aggregate value of (i) net income
(or net loss), (ii) Consolidated Interest Expense, (iii) provisions for income
taxes, (iv) depreciation, amortisation and other non-cash charges deducted in
arriving at such net income (or net loss), at any time during the Facility
Period as determined in accordance with US GAAP for the most recent four fiscal
quarters of SNSA, calculated on a pro forma historical basis to include
acquisitions.

 

1.1.22      “Consolidated Tangible Net Worth” means, for SNSA
and its Subsidiaries (on a consolidated basis) at any time, (a) the sum, to the
extent shown on SNSA’s consolidated balance sheet, of (i) the amount of issued
and outstanding share capital, less the cost of treasury shares of SNSA, plus
(ii) the amount of surplus and retained earnings, less (b) intangible assets as
determined in accordance with US GAAP.

 

1.1.23      “Currency of Account” means, in relation to any
payment to be made to a Finance Party pursuant to any of the Security
Documents, the currency in which that payment is required to be made by the
terms of the relevant Security Document.

 

6

 

1.1.24      “the Deeds of Covenants” means the deeds of
covenants referred to in Clause 9.1 (each a “Deed of Covenants”).

 

1.1.25      “Default Interest” means interest at the Default
Rate.

 

1.1.26      “Default Rate” means the rate which is one per
centum (1%) per annum over the aggregate of (i) the applicable Margin, (ii)
LIBOR and (iii) Mandatory Cost.

 

1.1.27      “DOC” means a valid Document of Compliance issued
for the Company by the Administration pursuant to paragraph 13.2 of the ISM
Code.

 

1.1.28      “Dollars” and “$” each means available and freely
transferable and convertible funds in lawful currency of the United States of
America.

 

1.1.29      “Drawdown Notice” means a notice complying with
Clause 2.3.

 

1.1.30      “Drawing” means a part (or, if requested and
available, all) of the Facility advanced by the Banks to the Borrower in
accordance with Clause 2.

 

1.1.31      “Earnings”, in relation to a Vessel, means all
hires, freights, pool income and other sums payable to or for the account of a
Shipowning Guarantor in respect of that Vessel including (without limitation)
all remuneration for salvage and towage services, demurrage and detention
moneys, contributions in general average, compensation in respect of any
requisition for hire and damages and other payments (whether awarded by any
court or arbitral tribunal or by agreement or otherwise) for breach,
termination or variation of any contract for the operation, employment or use
of the Vessel.

 

1.1.32      “Encumbrance” means any mortgage, charge, pledge,
lien, assignment, hypothecation, preferential right, option, title retention or
trust arrangement or any other agreement or arrangement which, in any of the
aforementioned instances, has the effect of creating security.

 

1.1.33      “Event of Default” means any of the events set
out in Clause 13.2.

 

1.1.34      “Execution Date” means the date on which this
Agreement is signed by all parties who are a signatory to it.

 

7

 

1.1.35      “Existing Facility” means the $140,000,000
revolving facility made available to the Borrower by a syndicate of banks
subject to the terms and conditions set forth in a facility agreement dated 26 November
1996 made between the Borrower, SNSA, DnB NOR Bank ASA as facility agent and
others as amended by certain waiver letters dated 12 September 2003, 15 October
2003, 28 November 2003 and 29 December 2003 respectively.

 

1.1.36      “Facility” means the revolving credit facility
made available by the Banks to the Borrower pursuant to this Agreement.

 

1.1.37      “the Facility Outstandings” at any time means the
total of all Drawings made at that time, to the extent not reduced by
repayments, prepayments and voluntary reductions.

 

1.1.38      “the Facility Period” means the period beginning
on the Execution Date and ending on the date when (i) the whole of the
Indebtedness has been repaid in full and the Borrower has ceased to be under
any further actual or contingent liability to the Finance Parties under or in
connection with the Security Documents and (ii) the Termination Date has
occurred.

 

1.1.39      “Fair Market Value” means the aggregate of the
market values of the Vessels as determined annually by a Valuation for each
Vessel pursuant to Clause 11.2.2.

 

1.1.40      “the Fee Letter” means the faxed letter dated 2
March 2004 from the Agent as agreed and accepted by the Borrower.

 

1.1.41      “the Finance Parties” means the Banks, the Agent,
the Security Trustee the Lead Arrangers, the Arrangers and the Co-Arranger.

 

1.1.42      “First Reduced Amount” means the lesser of one
hundred and twenty million Dollars ($120,000,000) and sixty per cent (60%) of
the Fair Market Value of all Vessels.

 

1.1.43      “First Reduction Date” means the date falling six
months after the Closing Date.

 

8

 

1.1.44      “the Guarantee” means the guarantee and indemnity
of SNSA contained in Clause 7.

 

1.1.45      “the Guarantor’s Liabilities” means all of the
liabilities and obligations of SNSA to the Finance Parties under or pursuant to
the Guarantee whether actual or contingent, including (without limitation)
Default Interest.

 

1.1.46      “the Indebtedness” means the Facility
Outstandings together with all interest thereon; all other sums of any nature
including costs and fees (together with all interest on any of those sums)
which from time to time may be payable by the Borrower to the Finance Parties
pursuant to the Security Documents; any damages payable as a result of any
breach by the Borrower of any of the Security Documents; and any damages or
other sums payable as a result of any of the obligations of the Borrower under
or pursuant to any of the Security Documents being disclaimed by a liquidator
or any other person, or, where the context permits, the amount thereof for the
time being outstanding.

 

1.1.47      an “Instructing Group” means any one or more
Banks whose combined Proportionate Shares exceed sixty seven per centum (67%)
of the aggregate of Commitments.

 

1.1.48      “Insurances”, in relation to a Vessel, means all
policies and contracts of insurance (including but not limited to hull and
machinery, all entries in protection and indemnity or war risks associations)
which are from time to time taken out or entered into in respect of or in
connection with that Vessel or her increased value and (where the context
permits) all benefits thereof, including all claims of any nature and returns
of premium.

 

1.1.49      “Insurance Proceeds Amount” means such amount of
the insurance proceeds in respect of a Total Loss which is required to be paid
by the Borrower to the Agent to ensure that the Borrower remains in full
compliance with its obligations under Clause 11.2.2. following a Total Loss.

 

9

 

1.1.50      “Interest Payment Date” means each date for the
payment of interest in accordance with Clause 6.

 

1.1.51      “Interest Period” means each interest period
selected by the Borrower or agreed by the Agent pursuant to Clause 6.

 

1.1.52      “Intermediary Companies” means those companies
within the SNSA Group who are wholly directly or indirectly owned Subsidiaries
of the Borrower and who own directly or indirectly any interest in any of the
Shipowning Guarantors.

 

1.1.53      “Investments” means the lending of any money, the
granting of any credit (other than to customers in the ordinary course of
business), the guarantee of any obligations or the making of any advance or
capital contribution.

 

1.1.54      “the ISM Code” means the International Management
Code for the Safe Management of Ships and for Pollution Prevention, as adopted
by the Assembly of the International Maritime Organisation on 4 November 1993
by resolution A.741 (18) and incorporated on 19 May 1994 as chapter IX of the
Safety of Life at Sea Convention 1974.

 

1.1.55      “the ISPS Code” means the International Ship and
Port Facility Security Code adopted by the International Maritime Organisation
(as the same may be amended from time to time).

 

1.1.56      “ISSC” means a valid and current International
Ship Security Certificate issued under the ISPS Code.

 

1.1.57      “law” means any law, statute, treaty, convention,
regulation, instrument or other subordinate legislation or other legislative or
quasi-legislative rule or measure, or any order or decree of any government,
judicial or public or other body or authority, or any directive, code of
practice, circular, guidance note or other direction issued by any competent
authority or agency (whether or not having the force of law).

 

1.1.58      “LIBOR” means, in relation to any Drawing:

 

(a)   the applicable Screen Rate; or

 

10

 

(b)   (if no Screen Rate is available for Dollars or for
the Interest Period of that Drawing)the arithmetic mean of the rates (rounded
upwards to four decimal places) as supplied to the Agent at its request quoted
by the Reference Banks to leading banks in the London interbank market,

 

for the offering of deposits in Dollars and
for a period comparable to the Interest Period for that Drawing.

 

1.1.59      “Liquidity” means the aggregate of Cash, Cash
Equivalents and Specified Committed Credit Lines.

 

1.1.60      “the Managers” means any member of the SNSA Group
and/or such other commercial and/or technical managers of the Vessels nominated
by the Shipowning Guarantors as an Instructing Group may in its discretion
approve.

 

1.1.61      “Management Agreement” means, in relation to any
Vessel which is leased to a party outside the SNSA Group, the Management
Agreement made between such Managers and the relevant Shipowning Guarantor.

 

1.1.62      “Mandatory Cost” means the percentage rate per
annum calculated by the Agent in accordance with Appendix B.

 

1.1.63      “Margin” based on the ratio of Consolidated Debt
(as at the date of Margin calculation) to Consolidated EBITDA for the preceding
four fiscal quarters (“D/EBITDA”) for which financial statements of SNSA and
its Subsidiaries have been prepared means:-

 

(i)            1.50% where D/EBITDA is equal to 3 or less;

 

(ii)           1.70% where D/EBITDA is greater than 3 but
equal to or less than 4;

 

(iii)          1.80% where D/EBITDA is greater than 4 or
equal to or less than 5; and

 

(iv)          1.90% where D/EBITDA greater than 5 or if it
is not possible to calculate D/EBITDA for that period.

 

11

 

The Margin shall be calculated by the Agent
as of 28/29 February, 31 May, 31 August and 30 November each year (each a
“Margin Review Date”) commencing 29 February 2004 for the succeeding fiscal
quarter and shall be calculated based on the Consolidated Debt as of the
previous Margin Review Date over Consolidated EBITDA for the four fiscal
quarters, the most recent of which shall have ended on the previous Margin
Review Date.

 

1.1.64      “Material Subsidiary” means, at any time, (i)
each Subsidiary of SNSA whose tangible net worth at such time is equal to or
greater than five per cent of the consolidated tangible net worth of SNSA and
all its Subsidiaries at such time (ii) each of any two or more Subsidiaries
which would each not be a Material Subsidiary for the purposes of paragraph (i)
but whose aggregate tangible net worth at such time is equal to or greater than
five per cent of the consolidated tangible net worth of SNSA and all its
subsidiaries at such time and (iii) each Subsidiary of SNSA the whole or any
part of whose financial indebtedness at such time is guaranteed or secured in
any way by the Security Parties, or any of them. For the purposes of this
definition, the term “tangible net worth” shall be construed in accordance with
US GAAP at the time any determination of tangible net worth is being made for
purposes of this Agreement.

 

1.1.65      “the Maximum Facility Amount” means the amount of
the aggregate Commitments (stated in Dollars) subject to any reductions
effected in accordance with Clauses 2.4, 5.6 or 16.8 as calculated by the Agent
on the date of each Drawing and at the end of each Interest Period.

 

1.1.66      “the Mortgagees’ Insurances” means all policies
and contracts of mortgagees’ interest insurance and any other insurance from
time to time taken out by the Agent on behalf of the Banks in relation to the
Vessels pursuant to this Agreement.

 

1.1.67      “the Mortgages” means the first priority
mortgages or first preferred mortgage (as the case may be) referred to in
Clause 9.1 (each a “Mortgage”).

 

12

 

1.1.68      “Permitted Liens” means (i) liens for salvage and
any Encumbrance which has the prior written approval of the Agent acting upon
the instructions of an Instructing Group, or (ii) any Encumbrance arising
either by operation of law or in the ordinary course of the business of the
relevant Security Party which is discharged in the ordinary course of business
but in any event does not exist for more than sixty (60) days.

 

1.1.69      “Potential Event of Default” means any event
which, with the giving of notice and/or the passage of time and/or the
satisfaction of any materiality test, would constitute an Event of Default.

 

1.1.70      “Proceedings” means any suit, action or
proceedings begun by any of the Finance Parties arising out of or in connection
with the Security Documents.

 

1.1.71      “Proportionate Share” means, for each Bank, the
percentage indicated against the name of that Bank in Schedule 1, as amended by
any Transfer Certificate executed from time to time.

 

1.1.72      “Pro Rata Insurance Proceeds Amount” means, in
respect of each Vessel, a figure equal to (a) a fraction in which (i) the
numerator is the amount of the insurance proceeds payable in respect of such
Vessel in the event of a Total Loss and (ii) the denominator is the aggregate
market value of all the Vessels (based on a Valuation for each Vessel)
multiplied by (b) the Maximum Facility Amount.

 

1.1.73      “Reduced Amount” means (a) for the period from
the Execution Date until the First Reduction Date, the First Reduced Amount and
(b) for the period from the First Reduction Date until the end of the Facility
Period, the First Reduced Amount as further reduced by (i) one fourteenth
(1/14th) on the First Reduction Date and on each of the eight Reduction Dates
occurring after the First Reduction Date and (ii) five fourteenths (5/14th) on
the Termination Date.

 

1.1.74      “Reduction Date” means each date falling six
months after the First Reduction Date or the previous Reduction Date (as the
case may be).

 

13

 

1.1.75      “Reference Banks” means Deutsche Bank AG in
Hamburg and DVB Bank AG.

 

1.1.76      “Requisition Compensation”, in relation to a
Vessel, means all compensation or other money which may from time to time be
payable to the relevant Shipowning Guarantor as a result of the Vessel being
requisitioned for title or in any other way compulsorily acquired (other than
by way of requisition for hire).

 

1.1.77      “Screen Rate” means the British Bankers
Association Interest Settlement Rate for the relevant currency and period and
displayed on the appropriate page of the Telerate or Reuters screen or such
other screen as is customarily used for that purpose.

 

1.1.78      “the Security Documents” means this Agreement,
the Mortgages, the Deeds of Covenants, the Assignments and the Shipowners’
Guarantee, or (where the context permits) any one or more of them, and any
other agreement or document which may at any time be executed by a member of
the SNSA Group as security for the payment of all or any part of the
Indebtedness.

 

1.1.79      “Security Maintenance Amount” means one hundred
and twenty five per cent (125%) of the Facility Outstandings less the amount of
any cash deposited as additional security pursuant to Clause 11.2.2.

 

1.1.80      “Security Parties” means the Borrower, SNSA, the
Shipowning Guarantors, the Managers and any other member of the SNSA Group who
may at any time during the Facility Period be liable for, or provide security
for, all or any part of the Indebtedness, and “Security Party” means any one of
them.

 

1.1.81      “the Shipowners’ Guarantee” means the joint and
several guarantee and indemnity of the Shipowning Guarantors referred to in
Clause 9.3.

 

1.1.82      “the Shipowning Guarantors” means the companies
listed in Schedule 3, each of which is a company incorporated according to the
law of the country indicated against its name in Schedule 3 with its registered
office

 

14

 

and/or principal place of business at the
address indicated against its name in Schedule 3 (each “a Shipowning
Guarantor”).

 

1.1.83      “SMC” in relation to any Vessel, means a valid
safety management certificate issued for the Vessel by or on behalf of the
Administration pursuant to paragraph 13.4 of the ISM Code.

 

1.1.84      “SMS” in relation to any Vessel, means a safety
management system for the Vessel developed and implemented in accordance with
the ISM Code and including the functional requirements, duties and obligations
required by the ISM Code.

 

1.1.85      “SNSA” means the guarantor Stolt-Nielsen S.A.

 

1.1.86      “SNSA Group” means SNSA and its Subsidiaries.

 

1.1.87      “SOSA” means Stolt Offshore S.A. being a company
incorporated and existing under the laws of Luxembourg.

 

1.1.88      “SOSA Liquidity Line” means the liquidity line in
the amount of fifty million Dollars ($50,000,000) expiring on 30 November 2004
and made available by SNSA and/or the Borrower to SOSA.

 

1.1.89      “Specified Committed Credit Line(s)” means the
aggregate unused, committed credit lines available to the SNSA Group with a
remaining tenor of no less than one (1) year, provided that prior to the First
Reduction Date the Facility shall be the sole Specified Committed Credit Line
available to the SNSA Group.

 

1.1.90      “Stolt Disclosure Letter” means the letter dated
23 March 2004 addressed by the Borrower and SNSA to the Agent and the Banks.

 

1.1.91      “Subsidiary” means a subsidiary undertaking, as
defined in section 258 Companies Act 1985 or any analogous definition under any
other relevant system of law.

 

1.1.92      “Surety” means any person (other than the
Borrower or SNSA) who has given or who may in the future give to the Finance
Parties or any of them

 

15

 

any security, guarantee or indemnity for or
in relation to the Borrower’s Obligations.

 

1.1.93      “Synthetic Lease” means any leasing structure
that qualifies as an operating lease for financial reporting purposes but is
considered a loan for applicable income or corporation tax purposes.

 

1.1.94      “Taxes” means all taxes, levies, imposts, duties,
charges, fees, deductions and withholdings (including any related interest and
penalties) and any restrictions or conditions resulting in any charge, other
than taxes on the overall net income of a Finance Party or branch thereof, and
“Tax” and “Taxation” shall be interpreted accordingly.

 

1.1.95      “the Termination Date” means the date falling
five (5) years from the Closing Date.

 

1.1.96      “Total Loss”, in relation to a Vessel means:-

 

(a)   an actual, constructive, arranged, agreed or
compromised total loss of that Vessel; or

 

(b)   the requisition for title, compulsory acquisition,
nationalisation or expropriation of that Vessel by or on behalf of any
government or other authority (other than by way of requisition for hire); or

 

(c)   the capture, seizure, arrest, detention or
confiscation of that Vessel, unless the Vessel is released and returned to the
possession of the relevant Shipowning Guarantor within two months after the
capture, seizure, arrest, detention or confiscation in question.

 

1.1.97      “Transfer Certificate” means a certificate
materially in the form set forth in Schedule 5 signed by a Bank and a
Transferee whereby:

 

(a)   such Bank seeks to procure the transfer to such
Transferee of all or a part of such Bank’s rights and obligations under this
Agreement upon and subject to the terms and conditions set out in Clause 15;
and

 

16

 

(b)   such Transferee undertakes to perform the
obligations it will assume as a result of delivery of such certificate to the
Agent as is contemplated in Clause 15.

 

1.1.98      “Transfer Date” means, in relation to any
Transfer Certificate, the date for the making of the transfer specified in the
schedule to such Transfer Certificate.

 

1.1.99      “Transferee” means a bank or other financial
institution to which a Bank seeks to transfer all or part of such Bank’s rights
and obligations under this Agreement.

 

1.1.100    “the Trust Property” means:-

 

(a)   the benefit of the covenant contained in Clause 9;
and

 

(b)   all benefits arising under (including, without
limitation, all proceeds of the enforcement of) each of the Security Documents
(other than this Agreement), with the exception of any benefits arising solely
for the benefit of the Agent).

 

1.1.101    “US GAAP” means the generally accepted accounting
principles in the United States of America, from time to time in effect,
subject to any changes in the rules of US GAAP, consistently applied always
provided that if SNSA wishes to change accounting principles within the
applicable rules of US GAAP, the Borrower shall notify the Agent of the
intention together with an explanation of the effects on the financial
covenants contained in this Agreement. Should the Banks, and/or SNSA, find that
such change will impact upon the result of the calculation of the financial
covenants contained in this Agreement, the Banks will, following consultation
with SNSA, stipulate amendments to the financial covenants so that the ratio of
the SNSA Group’s performance in respect of the covenants reflects the position
which would have been the case had no changes to SNSA’s accounting principles
taken place.

 

1.1.102    “Valuation” means in relation to each Vessel, the
arithmetic mean of four written valuations of that Vessel expressed in Dollars
each prepared by an Accepted Broker. Such valuations shall be prepared at the

 

17

 

Borrower’s expense, without a physical
inspection, on the basis of a sale for prompt delivery for cash at arm’s length
between a willing buyer and a willing seller without the benefit of any
charterparty or other engagement, and each Vessel shall be valued as a “parcel
tanker” engaged in the parcel trade and operating on the spot market.

 

1.1.103    “the Vessels” means the vessels listed in Schedule
3 and everything now or in the future belonging to them on board and ashore
(each a “Vessel”).

 

1.2           Interpretation

 

In this Agreement:-

 

1.2.1        words denoting the plural number include the
singular and vice versa;

 

1.2.2        words denoting persons include corporations,
partnerships, associations of persons (whether incorporated or not) or
governmental or quasi-governmental bodies or authorities and vice versa;

 

1.2.3        references to Recitals, Clauses, Schedules and
Appendices are references to recitals and clauses of, and schedules and
appendices to, this Agreement;

 

1.2.4        references to this Agreement include the
Recitals, the Schedules and the Appendices;

 

1.2.5        the headings and contents page(s) are for the
purpose of reference only, have no legal or other significance, and shall be
ignored in the interpretation of this Agreement;

 

1.2.6        references to any document (including, without
limitation, to all or any of the Security Documents) are, unless the context
otherwise requires, references to that document as amended, supplemented,
novated or replaced from time to time;

 

1.2.7        references to statutes or provisions of
statutes are references to those statutes, or those provisions, as from time to
time amended, replaced or re-enacted;

 

18

 

1.2.8        references to any of the Finance Parties
include its successors, Transferees and assignees;

 

1.2.9        references to times of day are (unless
otherwise stipulated) to London time; and

 

1.2.10      the word “including” means including (without
limitation) to the extent not already stated.

 

1.3           Joint and several liability

 

1.3.1        All obligations, covenants, representations,
warranties and undertakings in or pursuant to the Security Documents assumed,
given, made or entered into by the Borrower and SNSA shall, unless otherwise
expressly provided, be assumed, given, made or entered into by the Borrower and
SNSA jointly and severally.

 

1.3.2        Each of the Borrower and SNSA agrees that any
rights which it may have at any time during the Facility Period by reason of
the performance of its obligations under the Security Documents to be
indemnified by the other or by any Surety and/or to take the benefit of any
security taken by the Finance Parties pursuant to the Security Documents shall
be exercised in such manner and on such terms as the Agent may require. Each of
the Borrower and SNSA agrees to hold any sums received by it as a result of its
having exercised any such right on trust for the Agent (as agent for the Banks)
absolutely.

 

1.3.3        Each of the Borrower and SNSA agrees that it
will not at any time during the Facility Period claim any set-off or
counterclaim against the other or against any Surety in respect of any
liability owed to it by the other or by any Surety under or in connection with
the Security Documents, nor prove in competition with any Finance Party in any
liquidation of (or analogous proceeding in respect of) the other or of any
Surety in respect of any payment made under the Security Documents or in
respect of any sum which includes the proceeds of realisation of any security
held by any of the Finance Parties for the repayment of the Indebtedness.

 

19

 

2              The
Facility and its Purpose

 

2.1           Agreement to lend Subject to the terms and
conditions of this Agreement, and in reliance on each of the representations
and warranties made or to be made in or in accordance with each of the Security
Documents, each of the Banks agrees to advance to the Borrower its Commitment
of an aggregate principal amount not exceeding the Maximum Facility Amount to
be used by the Borrower for the purposes referred to in Recital (B).

 

2.2           Drawings Subject to satisfaction by the
Borrower of the conditions set out in Clause 3.1 (in respect of the first
Drawing), Clause 3.3 (in respect of all subsequent Drawings), and subject to
Clause 2.3, each Drawing shall be advanced to the Borrower, in each case by the
Agent transferring the amount of the Drawing to such account of the Borrower as
the Borrower shall notify to the Agent in the relevant Drawdown Notice by such
same day method of funds transfer as the Agent shall select.

 

2.3           Advance of Drawings Each Drawing shall be
advanced in Dollars. Each Drawing shall be advanced on a Business Day, provided
that the Borrower shall have given to the Agent by 11.00 a.m. not more than ten
and not fewer than three Business Days’ notice in writing signed in accordance
with a form of mandate provided by the Borrower to the Agent materially in the
form set out in Appendix A of the required Advance Date of the Drawing in question.
Each Drawdown Notice once given shall be irrevocable and shall constitute a
warranty by the Borrower that:-

 

2.3.1        all conditions precedent to the advance of the
Drawing requested in that Drawdown Notice will have been satisfied on or before
the Advance Date requested;

 

2.3.2        no Event of Default or Potential Event of
Default has occurred or will then have occurred; and

 

2.3.3        no Event of Default or Potential Event of
Default will result from the advance of the Drawing in question.

 

The Agent shall promptly notify each Bank of
the receipt of each Drawdown Notice, following which each Bank will make its
Proportionate Share of the

 

20

 

amount of the requested Drawing available to
the Borrower through the Agent on the Advance Date requested.

 

2.4           Facility Reduction

 

2.4.1        The initial Maximum Facility Amount available
to the Borrower for drawing under this Agreement shall be the lesser of one
hundred and thirty million Dollars ($130,000,000) and sixty five per cent (65%)
of the Fair Market Value for all Vessels during the period from the Execution
Date until the First Reduction Date. On the First Reduction Date and each of
the following eight Reduction Dates the Maximum Facility Amount shall reduce by
one fourteenth (1/14th) of the initial Maximum Facility Amount then available
on the First Reduction Date with a final reduction of five fourteenths (5/14th)
of such initial Maximum Facility Amount occurring on the Termination Date. The
mandatory reductions in the Maximum Facility Amount under this Clause will be
made in the amounts and at the times specified whether or not the Facility
Amount is reduced pursuant to Clause 2.4.2, Clause 5.6 or Clause 16.8.

 

2.4.2        The Borrower may from time to time voluntarily
reduce the Maximum Facility Amount in whole or in part in a minimum amount of
ten million Dollars ($10,000,000) or any greater whole number of millions of
Dollars provided that it has first given to the Agent not fewer than five
Business Days’ prior written notice expiring on a Business Day of its desire to
reduce the Maximum Facility Amount. Any such reduction in the Maximum Facility
Amount shall not be reversed.

 

2.4.3        In the event of a sale or disposal of a Vessel
(except as otherwise provided in Clause 11.1.4) the Maximum Facility Amount
shall permanently reduce by an amount equal to the proportion that a current
Valuation for such Vessel bears to the aggregate total amount of the current
Valuations for the remaining Vessels and the Vessel sold or disposed of pursuant
to this Clause. Any such reduction in the Maximum Facility Amount under this
Clause 2.4.3. shall not be available for re-drawing.

 

2.4.4        To the extent that repayments or prepayments
made by the Borrower to the Agent in accordance with this Agreement reduce the
Facility

 

21

 

Outstandings to less than the Maximum
Facility Amount, the Borrower shall again be entitled to make Drawings in
accordance with and subject to the terms of this Agreement. The Facility
Outstandings shall not at any time during the Facility Period exceed the
Maximum Facility Amount then available. If, at any time, the Facility
Outstandings exceed the Maximum Facility Amount then available, the Borrower
shall immediately prepay such amount of the Facility Outstandings as will
ensure that the Facility Outstandings are less than or equal to the Maximum
Amount then available.

 

2.4.5        Simultaneously with each reduction of the
Maximum Facility Amount in accordance with Clause 2.4.1, 2.4.2 or 2.4.3 (as the
case be) the Commitment of each Bank will reduce so that the Commitments of the
Banks in respect of the reduced Maximum Facility Amount remain in accordance
with their respective Proportionate Shares.

 

2.5           Restrictions on Drawings The Borrower shall
not be entitled to make more than two (2) Drawings on any Business Day and no
more than five (5) Drawings may be outstanding at any one time during the
Facility Period. Each Drawing shall be of a whole number of millions of Dollars
and of not less than ten million Dollars ($10,000,000). In addition, if at any
time during the Facility Period the SOSA Liquidity Line is in existence, the
Borrower shall not be entitled to draw more than the relevant Reduced Amount,
in aggregate, during such period.

 

2.6           Termination Date No Bank shall be under any
obligation to advance all or any part of its Commitment after the Termination
Date.

 

2.7           Several obligations The obligations of the
Banks under this Agreement are several. The failure of a Bank to perform its obligations
under this Agreement shall not affect the obligations of the Borrower to any
Finance Party nor shall any Finance Party be liable for the failure of another
Bank to perform any of its obligations under or in connection with this
Agreement.

 

2.8           Application of Facility Without prejudice to
the obligations of the Borrower under this Agreement, no Finance Party shall be
obliged to concern itself with the application of the Facility by the Borrower.

 

22

 

2.9           Loan facility and control accounts The Agent
will open and maintain such loan facility account or such other control
accounts as the Agent shall in its discretion consider necessary or desirable
in connection with the Facility.

 

3              Conditions
Precedent and Subsequent

 

3.1           Conditions Precedent - First Drawing Before
any Bank shall have any obligation to advance the first Drawing under the
Facility, the Borrower shall pay to the Agent the relevant fees referred to in
Clause 8 and the Fee Letter and deliver or cause to be delivered to or to the
order of the Agent (in sufficient copies for all Banks) the following documents
and evidence:-

 

3.1.1        Evidence of incorporation Such evidence as the
Agent may reasonably require that each Security Party was duly incorporated in
its country of incorporation and remains in existence and, where appropriate,
in good standing, with power to enter into, and perform its obligations under,
those of the Security Documents to which it is, or is intended to be, a party,
including (without limitation) a copy, certified by a director or an officer of
the Security Party in question as true, complete, accurate and unamended, of
all documents establishing or limiting the constitution of each Security Party.

 

3.1.2        Corporate authorities A copy, certified by a
director or the secretary of the Security Party in question as true, complete,
accurate and neither amended nor revoked, of a resolution of the directors and
(other than SNSA) a resolution of the shareholders of each Security Party
(together, where appropriate, with signed waivers of notice of any directors’
or shareholders’ meetings) approving, and authorising or ratifying the
execution of, those of the Security Documents and each Drawdown Notice to which
that Security Party is or is intended to be a party and all matters incidental
thereto.

 

3.1.3        Officer’s certificate A certificate (i) signed
by a duly authorised officer of each of the Security Parties setting out the
names of the directors, officers and shareholders of that Security Party and
(ii) issued by each Security Party’s company registry confirming due
incorporation and valid

 

23

 

existence and (when such information is
maintained by the registry) the names of its directors and shareholders.

 

3.1.4        Power of attorney The power of attorney
(notarially attested and legalised, if necessary, for registration purposes) of
each of the Security Parties under which any documents are to be executed or
transactions undertaken by that Security Party.

 

3.1.5        Vessel documents Photocopies, certified as
true, accurate and complete by a director or the secretary of the relevant
Shipowning Guarantor of (in respect of each Vessel):-

 

(a)   any time charterparty or bareboat charterparty of
that Vessel which will be in force on the first Advance Date and which exceeds
twelve (12) months duration which is entered into with an entity which is not a
member of the SNSA Group;

 

(b)   the Management Agreement relating to that Vessel
which is in force at the time of this Agreement; and

 

(c)   that Vessel’s current Safety Construction, Safety
Equipment, Safety Radio and Load Line Certificates;

 

(d)   if required by law and that Vessel is operating in
the waters of the United States of America, that Vessel’s current Certificate
of Financial Responsibility issued pursuant to the United States Oil Pollution
Act 1990;

 

(e)   where applicable, that Vessel’s current SMC; and

 

(f)    where applicable, each Company’s current DOC;

 

in each case together with all addenda,
amendments or supplements.

 

3.1.6        Evidence of ownership In respect of each
Vessel, certificate(s) of ownership and encumbrance (or equivalent) issued by
the Registrar of Ships (or equivalent official) at the Vessel’s port of
registry confirming that such Vessel is on the first Advance Date owned by her
Shipowning Guarantor and free of registered Encumbrances.

 

24

 

3.1.7        Evidence of insurance Evidence that each Vessel
is insured in the manner required by the Security Documents and that letters of
undertaking will be issued in the manner required by the Security Documents,
together with (if required by the Agent) the written approval of the Insurances
by an insurance adviser appointed by the Agent.

 

3.1.8        Confirmation of class A Certificate of
Confirmation of Class for hull and machinery (dated not more than seven days
before the first Advance Date) confirming that each Vessel is classed 100 A 1
by Lloyd’s Register of Shipping, or + A1 by Det norske Veritas, or with the
highest applicable class necessary to operate such vessel (without
recommendations or extensions) of the American Bureau of Shipping or such other
classification society as may be acceptable to the Agent.

 

3.1.9        Valuations A Valuation of each Vessel addressed
to the Agent to be dated not more than two (2) months prior to the first
Advance Date to occur.

 

3.1.10      Survey Reports At the Borrower’s expense, a
report by a surveyor (approved by the Agent) confirming that the condition of
each Vessel (other than “STOLT TITAN”) is in all respects reasonably acceptable
to the Banks. Such survey reports shall be dated not more than six (6) months
prior to the first Advance Date to occur.

 

3.1.11      The Security Documents The Security Documents,
together with all notices and other documents required by any of them, duly
executed and, in the case of the Mortgages, registered with first priority
through the Registrar of Ships (or equivalent official) at the port of registry
of the Vessel concerned.

 

3.1.12      Drawdown Notice A Drawdown Notice.

 

3.1.13      Process agent A letter from Stolt-Nielsen Limited
accepting their appointment by each of the Security Parties as agent for
service of Proceedings pursuant to the Security Documents.

 

3.1.14      Managers’ subordination confirmation letter The
written confirmation of the Managers that they will (i) remain the commercial
and technical

 

25

 

managers of the Vessels throughout the
Facility Period and will manage the Vessels in accordance with good standard
ship management practice and (ii) subordinate all their rights in relation to
the Vessels to those of the Finance Parties.

 

3.1.15      The Fee Letter/Fees The Fee Letter countersigned
on behalf of the Borrower by way of acceptance of its terms and the payment of
any fees due and payable under Clause 8.

 

3.1.16      Legal opinions Confirmation satisfactory to the
Agent that all legal opinions required by the Agent on behalf of the Banks will
be given substantially in the form required by the Agent on behalf of the
Banks.

 

3.1.17      Evidence of Capitalisation Evidence that the
recapitalisation of (i) SNSA, in the gross sum of one hundred and four million
Dollars ($104,000,000) and (ii) SOSA, in the gross amount of one hundred
million Dollars ($100,000,000) (excluding the conversion of up to fifty million
Dollars ($50,000,000) in subordinated debt owed by SOSA to SNSA into SOSA
equity which is due to take place), has taken place.

 

3.1.18      Corporate Structure Evidence of (i) the financial
condition of the SNSA Group confirming that the SNSA Group will, in all
likelihood, be able to meet its payment obligations as and when they fall due
within the next eighteen (18) months following the Closing Date, (ii) the
actual corporate structure of the SNSA Group insofar as it relates to the
Security Parties and (iii) the deconsolidation of SOSA from SNSA and that SNSA
holds less than fifty per cent (50%) of the shares in SOSA.

 

3.1.19      Margin Such evidence as the Agent shall require
in order to set the Margin.

 

3.1.20      “Know your customer” Such documents and evidence
as the Agent may reasonably request in order for the Agent to comply with its
“know your customer” requirements to confirm the identity of the Security
Parties and/or the individuals acting on their behalf.

 

3.1.21      Manager’s consent to loss payable The written
consent of the Managers and other named assureds in respect of the Insurances
to the loss payable

 

26

 

in respect of all Vessels in the form
appended at Appendix C to each Assignment.

 

3.1.22      SOSA Liquidity Line Evidence that there are no
outstanding drawings or amounts due under the SOSA Liquidity Line.

 

3.2           Conditions Subsequent The Borrower
undertakes to deliver or to cause to be delivered to the Agent on, or with the
prior approval of the Agent, as soon as practicable after the first Advance
Date or otherwise within the time specified in this Clause, the following
additional documents and evidence:-

 

3.2.1        Evidence of registration Evidence of
registration of the Mortgages, in each case with first priority with the
Registrar of Ships (or equivalent official) at the port of registry of the
Vessel concerned.

 

3.2.2        Letters of undertaking Letters of undertaking
as required by the Security Documents in form and substance acceptable to the
Agent.

 

3.2.3        Legal opinions Such legal opinions as the Agent
on behalf of the Banks shall require pursuant to Clause 3.1.16.

 

3.2.4        Companies Act registrations Evidence that the
prescribed particulars of the Security Documents have been delivered to the
Registrar of Companies of England and Wales within the statutory time limit.

 

3.2.5        Survey Reports At the Borrower’s expense a
report by a surveyor (approved by the Agent) confirming that the condition of
m.v. “STOLT TITAN” (by 5 June 2004) is in all respects reasonably acceptable to
the Banks.

 

3.2.6        Accounts The consolidated audited accounts of
SNSA for its financial year just ended, certified by a director or the chief
financial officer of SNSA, as fair and accurate to be delivered to the Agent
immediately upon the same being audited.

 

3.2.7        ISPS Code Photocopies, certified as true,
accurate and complete by a director of the relevant Shipowning Guarantor of
each Vessel’s ISSC, no later than 1 July 2004.

 

27

 

3.3           Conditions Precedent - Subsequent Drawings
Before any Bank shall have any obligation to advance any subsequent Drawings
under the Facility, the Borrower shall deliver or cause to be delivered to the
order of the Agent, a Drawdown Notice, in addition to the documents and
evidence referred to in Clause 3.1 where such documents and evidence have not
already been delivered to and received by the Agent.

 

3.4           No waiver If the Banks in their sole
discretion agree to advance any part of the Facility to the Borrower before all
of the documents and evidence required by Clause 3.1 or Clause 3.3 (as the case
may be) have been delivered to or to the order of the Agent, the Borrower
undertakes to deliver all outstanding documents and evidence to or to the order
of the Agent no later than the date specified by the Agent, and the advance of
any part of the Facility shall not be taken as a waiver of the Agent’s right to
require production of all the documents and evidence required by Clause 3.1 or
Clause 3.3 (as the case may be).

 

3.5           Form and content All documents and evidence
delivered to the Agent pursuant to this Clause shall:-

 

3.5.1        (i) with respect to the documents and evidence
referred to in Clause 3.1, be in form and substance acceptable to the Banks and
(ii) otherwise be in form and substance acceptable to the Agent;

 

3.5.2        be accompanied, if required by the Agent, by
translations into the English language, certified in a manner acceptable to the
Agent;

 

3.5.3        if required for registration purposes, be
certified, notarised, legalised or attested in a manner acceptable to the
Agent.

 

3.6           Event of Default No Bank shall be under any
obligation to advance any part of its Commitment nor to act on any Drawdown
Notice if, at the date of the Drawdown Notice or at the date on which the
advance of a Drawing is requested in the Drawdown Notice, an Event of Default
or Potential Event of Default shall have occurred, or if an Event of Default or
Potential Event of Default would result from the advance of the Drawing in
question or if, after giving effect to such Drawing, the aggregate Valuations
(which were last delivered to the Agent pursuant to this Agreement) of the
Vessels plus any other security (other than

 

28

 

cash) provided pursuant to Clause 11.2.2
would be less than the Security Maintenance Amount.

 

4              Representations
and Warranties

 

Each of the Borrower and SNSA represents and
warrants to each of the Finance Parties at the date of this Agreement and (by
reference to the facts and circumstances then pertaining) at the date of each
Drawdown Notice, at each Advance Date and at each Interest Payment Date as
follows (except that the representations and warranties contained in Clauses
4.6, 4.7(a) and 4.13 shall only be made on the first Advance Date and the
representation and warranty contained in Clause 4.16 shall be made by the
Borrower only on a daily basis throughout the Facility Period):-

 

4.1           Incorporation and capacity Each of the
Security Parties is a body corporate duly constituted, organised and validly
existing and (where applicable) in good standing under the law of its country
of incorporation, in each case with perpetual corporate existence and the power
to sue and be sued, to own its assets and to carry on its business, and all of
the corporate shareholders (if any) of each Security Party are duly constituted
and existing under the laws of their countries of incorporation with perpetual
corporate existence and the power to sue and be sued, to own their assets and
to carry on their business and are acting on their own account.

 

4.2           Solvency None of the Security Parties is
insolvent or in liquidation or administration or subject to any other
insolvency procedure, and no receiver, administrative receiver, administrator,
liquidator, trustee or analogous officer has been appointed in respect of any
of the Security Parties or all or any part of their assets except if such
insolvency should arise in relation to a Shipowner in the circumstances where a
demand has been made under the Shipowners’ Guarantee. For this purpose a
Security Party will be deemed insolvent if it is unable to pay its debts within
the meaning of S.123 of the Insolvency Act 1986 save in relation to the
exception referred to in the previous sentence.

 

4.3           Binding obligations The Security Documents
when duly executed and delivered will constitute the legal, valid and binding
obligations of the Security Parties enforceable in accordance with their
respective terms subject to applicable laws regarding creditors’ rights in
general, and (in the case of the Borrower) no

 

29

 

utilisation of the Facility will cause any
limit or restriction on its borrowing or other powers (however imposed), or on
the right or ability of its directors to exercise those powers, to be exceeded
or breached.

 

4.4           Satisfaction of conditions All acts,
conditions and things required to be done and satisfied and to have happened
prior to the execution and delivery of the Security Documents in order to
constitute the Security Documents the legal, valid and binding obligations of
the Security Parties in accordance with their respective terms have been done,
satisfied and have happened in compliance with all applicable laws.

 

4.5           Registrations and consents With the
exception only of the registrations referred to in Clause 3.2, all (if any)
consents, licences, approvals and authorisations of, or registrations with or
declarations to, any governmental authority, bureau or agency which may be
required in connection with the execution, delivery, performance, validity or
enforceability of the Security Documents have been obtained or made and remain
in full force and effect and neither the Borrower nor SNSA is aware of any
event or circumstance which could reasonably be expected adversely to affect
the right of any of the Security Parties (as the case may be) to hold and/or
obtain renewal of any such consents, licences, approvals or authorisations.

 

4.6           Disclosure of material facts Neither the
Borrower nor SNSA is aware of any material facts or circumstances which has not
been disclosed to the Agent in the Stolt Disclosure Letter and which might, if
disclosed, have reasonably been expected to adversely affect the decision of a
person considering whether or not to make loan facilities of the nature
contemplated by this Agreement available to the Borrower, and the most recently
published consolidated annual financial statements of the SNSA Group give a
true and fair view of the state of affairs of the SNSA Group on the date as at
which those financial statements were prepared.

 

4.7           No material litigation Except as specified
in the Stolt Disclosure Letter, there is no action, suit, arbitration or
administrative proceeding nor any contemplated action, suit, arbitration or
administrative proceeding pending or to its knowledge about to be pursued
before any court, tribunal or governmental or other authority (a) which would,
or would be likely to, have a materially adverse effect on the

 

30

 

business, assets, condition (financial or
otherwise) or creditworthiness of any of the Security Parties or (b) which
might reasonably be expected adversely to affect the legality, validity or
enforceability of any of the Security Documents.

 

4.8           No breach of law or contract The execution,
delivery and performance of the Security Documents will not contravene any
contractual restriction or any law binding on any of the Security Parties or on
any shareholder (whether legal or beneficial) of any of the Security Parties,
or the constitutional documents of any of the Security Parties, nor result in
the creation of, nor oblige any of the Security Parties to create, any
Encumbrance over all or any of its assets, with the exception of the
Encumbrances created by or pursuant to the Security Documents.

 

4.9           No deductions Except as disclosed to the
Agent in writing, to the best of their knowledge and belief and without undue
enquiry, none of the Security Parties is required to make any deduction or
withholding from any payment which it may be obliged to make to any of the
Finance Parties under or pursuant to the Security Documents.

 

4.10         Filings Each Security Party has complied with
all filing or registration requirements relative to each place in which it
carries on business.

 

4.11         Use of Facility The Facility will be used for
the purposes specified in Recital (B).

 

4.12         Subsidiaries Save as a result of any merger or
amalgamation effected pursuant to Clause 11.1.3, each of the Shipowning
Guarantors is and will remain throughout the Facility Period a directly or
indirectly wholly owned subsidiary of SNSA.

 

4.13         Material Adverse Change Except as specified in
the Stolt Disclosure Letter, there has been no material adverse change in the
condition (financial or otherwise) of the Borrower or SNSA since 19 February
2004.

 

4.14         SNSA’s company Status SNSA operates as a
milliardaire holding company and finance holding company under Luxembourg law
pursuant to the terms of a letter of the “Administration de l’Enregistrement et
des Domaines” dated 14 September 1984.

 

31

 

4.15         Liabilities There are no liabilities
(contingent or otherwise) of the SNSA Group which were not disclosed by the
most recently published consolidated financial statements of the SNSA Group (or
by the notes thereto) or reserved against therein except where such disclosure
or reserve is not required by US GAAP, nor any unrealised or anticipated losses
arising from commitments entered into by any member of the SNSA Group which
were not so disclosed or reserved against but which, if they had been disclosed
or reserved against, would have materially affected the content of those
financial statements.

 

4.16         Money Laundering In relation to obtaining any
Drawing, the performance and discharge of its obligations and liabilities under
this Agreement and any of the other Security Documents and the transactions and
other arrangements effected or contemplated by this Agreement and any of the
other Security Documents to which the Borrower is a party, the Borrower is
acting for its own account and that none of the foregoing activities will
involve or lead to the contravention of any law, official requirement or other
regulatory measure or procedure which has been implemented to combat “money
laundering” (as defined in each of Article 1 of Directive 91/308/EEC issued by
Council of the European Community and the USA Patriot Act 2001, Publ. L. No
107-56).

 

4.17         No Immunity from suit None of the Security
Parties nor any of their respective assets or other property enjoys, nor will
any Security Party assert or claim at any time during the Facility Period, any
right of immunity from set-off, suit or execution in respect of its obligations
under the Security Documents to which it is a party.

 

5              Repayment
and Prepayment

 

5.1           Repayment Each Drawing shall be repaid by
the Borrower to the Agent on behalf of the Banks on the last day of its
Interest Period unless the Borrower selects a further Interest Period for that
Drawing in accordance with Clause 6, provided that the Borrower shall not be
permitted to select and shall not be deemed to have selected such further
Interest Period if an Event of Default or Potential Event of Default has
occurred and shall then be obliged to repay such Drawing on the last day of its
then current Interest Period. The Borrower shall on the Termination Date repay
to the Agent as agent for the Banks all Facility Outstandings.

 

32

 

5.2           Prepayment Subject to Clause 5.4, the
Borrower may prepay the Facility Outstandings in whole or in part in a minimum
amount of ten million Dollars ($10,000,000) or any greater whole number of
millions of Dollars, (or as otherwise may be agreed by the Agent) provided that
it has first given to the Agent not fewer than five Business Days’ prior
written notice expiring on a Business Day of its intention to do so. Any notice
pursuant to this Clause 5.2 once given shall be irrevocable and shall oblige
the Borrower to make the prepayment referred to in the notice on the Business
Day specified in the notice, together with all interest accrued on the amount
prepaid up to and including that Business Day.

 

5.3           Prepayment indemnity If the Borrower shall,
subject always to Clause 5.2, make a prepayment on a Business Day other than
the last day of an Interest Period, it shall pay to the Agent on behalf of the
Banks any amount which is necessary to compensate the Banks for any Break Costs
incurred by the Agent or any of the Banks as a result of the prepayment in
question.

 

5.4           Application of prepayments Any prepayment
(including for the avoidance of doubt any sums received by the Agent in respect
of the Insurance Proceeds Amount) in an amount less than the Indebtedness shall
be applied in satisfaction or reduction first of any costs and other expenses
outstanding; secondly of all interest accrued with respect to the outstanding
Drawings; thirdly of all other interest accrued and fourthly of the outstanding
Drawings in inverse order of maturity.

 

5.5           Reborrowing of prepayments Any amount
prepaid pursuant to this Agreement may be reborrowed in accordance with Clause
2.4.4, subject to compliance with Clause 11.2.2.

 

5.6           Total Loss In the event that any Vessel
becomes a Total Loss, on the date of such Total Loss occurring, the Maximum
Facility Amount shall reduce by the Pro Rata Insurance Proceeds Amount in
respect of such Vessel on the earlier to occur of (a) the one hundred and
eightieth day after the date of such Total Loss occurring and (b) the date on
which the Shipowning Guarantor receives the proceeds of such Total Loss. Any
such prepayment shall not be reborrowed, and Clause 5.3 shall apply to any such
prepayment.

 

33

 

6              Interest

 

6.1           Interest Periods The period during which any
Drawing shall be outstanding pursuant to this Agreement shall be divided into
consecutive Interest Periods of one, two, three or six months’ duration, as
selected by the Borrower by written notice to the Agent not later than 11.00
a.m. on the third Business Day before the beginning of the Interest Period in
question, or such other duration as may be agreed by the Banks in their
discretion. If, in respect of any Drawing, the Borrower fails to select an
Interest Period in accordance with this Clause, the Borrower shall (subject to
Clause 5.1) be deemed to have selected an Interest Period for that Drawing of
three months’ duration.

 

6.2           Beginning and end of Interest Periods The
first Interest Period in respect of each Drawing shall begin on the Advance
Date of that Drawing and shall end on the last day of the Interest Period
selected in accordance with Clause 6.1. Any subsequent Interest Period selected
or deemed selected in respect of each Drawing shall commence on the day
following the last day of its previous Interest Period and shall end on the
last day of its current Interest Period selected or deemed selected in
accordance with Clause 6.1. However, in respect of any Drawings outstanding on
the Termination Date, the Interest Period applicable to such Drawings shall end
on the Termination Date.

 

6.3           Interest rate During each Interest Period,
interest shall accrue on each Drawing at the rate determined by the Agent to be
the aggregate of (a) the applicable Margin, (b) LIBOR and if applicable (c) the
Mandatory Cost, determined in each case, at or about 11.00 a.m. on the second
Business Day prior to the beginning of the Interest Period relating to that
Drawing. The Margin may be adjusted if necessary on any Margin Review Date
during the Interest Period.

 

6.4           Accrual and payment of interest During the
Facility Period, interest shall accrue from day to day, shall be calculated on
the basis of a 360 day year and the actual number of days elapsed (or, in any
circumstance where market practice differs, in accordance with the prevailing
market practice) and shall be paid by the Borrower to the Agent on behalf of
the Banks on the last day of each Interest Period and additionally, during any
Interest Period exceeding three months, on the last day of each successive
three month period after the beginning of that Interest Period.

 

34

 

6.5           Ending of Interest Periods If any Interest
Period would end on a day which is not a Business Day, that Interest Period
shall end on the next succeeding Business Day (unless the next succeeding
Business Day falls in the next calendar month, in which event the Interest
Period in question shall end on the next preceding Business Day).

 

6.6           Default Rate If an Event of Default shall
occur, the whole of the Indebtedness shall, from the date of the occurrence of
the Event of Default, bear interest up to the date of actual payment (both
before and after judgment) at the Default Rate, compounded at such intervals as
the Agent shall in its reasonable discretion determine, which interest shall be
payable from time to time by the Borrower to the Agent on behalf of the Banks
on demand.

 

6.7           Determinations conclusive Each determination
of an interest rate made by the Agent in accordance with Clause 6 shall (save
in the case of manifest error or on any question of law) be final and
conclusive.

 

7              Guarantee
and Indemnity

 

7.1           The Borrower’s Obligations In consideration
of the agreement of the Banks to make the Facility available to the Borrower,
SNSA:-

 

7.1.1        irrevocably and unconditionally guarantees to
discharge on demand the Borrower’s Obligations, including Default Interest from
the date of demand until the date of payment, both before and after judgement;
and

 

7.1.2        agrees, as a separate and independent
obligation, that, if any of the Borrower’s Obligations are not recoverable from
SNSA under Clause 7.1.1 for any reason, SNSA will be liable to the Finance
Parties as principal debtor by way of indemnity for the same amount as that for
which SNSA would have been liable had those Borrower’s Obligations been
recoverable and agrees to discharge its liability under this Clause 7.1.2 on
first demand together with Default Interest from the date of demand until the
date of payment, both before and after judgement.

 

7.2           Continuing Security The Guarantee is a
continuing security for the full amount of the Borrower’s Obligations from time
to time and shall remain in force notwithstanding the liquidation of the
Borrower or any change in the constitution

 

35

 

of the Borrower or of any Finance Party or
the absorption of or amalgamation by any Finance Party in or with any other
entity or the acquisition of all or any part of the assets or undertaking of
any Finance Party by any other entity.

 

7.3           Preservation of SNSA’s Liability

 

7.3.1        The Banks may without SNSA’s consent and
without notice to SNSA and without in any way releasing or reducing the
Guarantor’s Liabilities:-

 

(a)   amend, novate, supplement or replace all or any of
the Borrower’s Security Documents;

 

(b)   increase or reduce the amount of the Facility or
vary the terms and conditions for its repayment or prepayment (including,
without limitation, the rate and/or method of calculation of interest payable
on the Facility);

 

(c)   allow to the Borrower or to any other person any
time or other indulgence;

 

(d)   renew, vary, release or refrain from enforcing any
of the Borrower’s Security Documents or any other security, guarantee or
indemnity which the Agent may now or in the future hold from the Borrower or
from any other person;

 

(e)   compound with the Borrower or any other person;

 

(f)    enter into, renew, vary or terminate any other
agreement or arrangement with the Borrower or any other person; or

 

(g)   make any concession to the Borrower or do or omit or
neglect to do anything which might, but for this provision, operate to release
or reduce the liability of SNSA under the Guarantee.

 

7.3.2        The liability of SNSA under the Guarantee shall
not be affected by:-

 

(a)   the absence of or any defective, excessive or
irregular exercise of any of the powers of the Borrower or of any Surety;

 

36

 

(b)   any security given or payment made to the Finance
Parties or any of them by the Borrower or any other person being avoided or
reduced under any law (whether English or foreign) relating to bankruptcy or
insolvency or analogous circumstance in force from time to time;

 

(c)   the liquidation, administration, receivership or
insolvency of SNSA;

 

(d)   any other security, guarantee or indemnity now or in
the future held by the Finance Parties or any of them being defective, void or
unenforceable, or the failure of the any Finance Party to take any security,
guarantee or indemnity;

 

(e)   any compromise or arrangement under Part I or Part
VII of the Insolvency Act 1986 or section 425 of the Companies Act 1985 (or any
statutory modification or re-enactment of either of them for the time being in
force) or under any analogous provision of any foreign law;

 

(f)    the novation of any of the Borrower’s Obligations;

 

(g)   anything which would not have released or reduced
the liability of SNSA to the Finance Parties had the liability of SNSA under
Clause 7.1.1 been as a principal debtor of the Finance Parties and not as a
guarantor.

 

7.4           Preservation of Banks’ Rights

 

7.4.1        The Guarantee is in addition to any other
security, guarantee or indemnity now or in the future held by the Finance
Parties in respect of the Borrower’s Obligations, whether from the Borrower,
SNSA or any other person, and shall not merge with, prejudice or be prejudiced
by any such security, guarantee or indemnity or any contractual or legal right
of each Finance Party.

 

7.4.2        Any release, settlement, discharge or
arrangement relating to the liabilities of SNSA under the Guarantee shall be
conditional on no payment,

 

37

 

assurance or security received by the Finance
Parties in respect of the Borrower’s Obligations being avoided or reduced under
any law (whether English or foreign) in force from time to time relating to
bankruptcy, insolvency or any (in the opinion of the Agent) analogous
circumstance and after any such avoidance or reduction the Finance Parties
shall be entitled to exercise all of their rights, powers, discretions and
remedies under or pursuant to the Guarantee and/or any other rights, powers,
discretions or remedies which they would otherwise have been entitled to
exercise, as if no release, settlement, discharge or arrangement had taken
place.

 

7.4.3        Following the discharge of the Borrower’s
Obligations, the Finance Parties shall be entitled to retain any security which
they may hold for the liabilities of SNSA under the Guarantee until the Finance
Parties are satisfied in their reasonable discretion that they will not have to
make any payment under any law referred to in Clause 7.4.2.

 

7.4.4        Until all claims of the Finance Parties in
respect of the Borrower’s Obligations have been discharged in full:-

 

(a)   SNSA shall not be entitled to participate in any
security held or sums received by any Finance Party in respect of all or any
part of the Borrower’s Obligations;

 

(b)   SNSA shall not stand in the place of, or be
subrogated for, any of the Finance Parties in respect of any security nor take
any step to enforce any claim against the Borrower or any Surety (or the estate
or effects of any such person) nor claim or exercise any right of set off or
counterclaim against the Borrower or any Surety nor make any claim in the
bankruptcy or liquidation of the Borrower or any Surety in respect of any sums
paid by SNSA to the Finance Parties or any of them or in respect of any sum
which includes the proceeds of realisation of any security at any time held by
the Finance Parties or any of them in respect of all or any part of the
Guarantor’s Liabilities; and

 

38

 

(c)   SNSA shall not take any steps to enforce any claim
which it may have against the Borrower or any Security Party without the prior
written consent of the Agent acting on behalf of an Instructing Group, and then
only on such terms and subject to such conditions as the Agent may impose.

 

7.4.5        The Guarantor’s Liabilities shall be continuing
for all purposes (including Default Interest) and every sum of money which may
now or in the future be or become due or owing to the Finance Parties by the
Borrower under the Security Documents to which the Borrower is a party (or
which would have become due or owing had it not been for the bankruptcy,
liquidation or insolvency of the Borrower) shall be deemed to continue due and
owing to the Finance Parties by the Borrower until such sum is actually repaid
to the Finance Parties, notwithstanding the bankruptcy, liquidation or
insolvency of the Borrower.

 

7.4.6        The Finance Parties may, but shall not be
obliged to, resort for their own benefit to any other means of payment at any
time and in any order they think fit without releasing or reducing the
Guarantor’s Liabilities.

 

7.4.7        The Finance Parties may enforce the Guarantee
either before or after resorting to any other means of payment or enforcement
and, in the latter case, without entitling SNSA to any benefit from or share in
any such other means of payment for so long as the Borrower’s Obligations have
not been discharged in full.

 

7.5           Other Security SNSA confirms that it has not
taken and will not take without the prior written consent of the Agent acting
on behalf of an Instructing Group (and then only on such terms and subject to
such conditions as the Agent may impose acting on behalf of an Instructing
Group) any security from the Borrower or from any Surety in connection with the
Guarantee and any security taken by SNSA in connection with the Guarantee notwithstanding
this Clause shall be held by SNSA in trust for the Agent on behalf of the
Finance Parties absolutely as a continuing security for the Guarantor’s
Liabilities.

 

39

 

8              Fees

 

8.1           The Borrower shall pay to or to the order of
the Agent the fees, commissions and other sums referred to in the Fee Letter in
the amounts and on the dates set out in the Fee Letter.

 

8.2           The Borrower shall pay to the Agent, for the
account of the Banks in accordance with their Proportionate Shares, Commitment
Commission in Dollars at the rate of forty-five per centum (45%) of the
applicable Margin per annum on any undrawn part of the Facility after the
Execution Date. The Commitment Commission will accrue from day to day on the
basis of a 360 day year and the actual number of days elapsed and shall be paid
quarterly in arrears on each Margin Review Date from the Closing Date until the
Termination Date based upon the Margin in effect from time to time. Where any
Commitment Commission is due and payable prior to the first Advance Date the
applicable Margin shall be the Margin that would have applied to the Facility
if all or any part of the Facility had been advanced under this Agreement.

 

8.3           The Borrower shall pay to the Agent (for its
own account) an annual agency fee of fifty thousand Dollars ($50,000). Such
agency fee shall be due and payable on the Closing Date and on each anniversary
thereof occurring during the Facility Period.

 

9              Security
Documents

 

As security for the repayment of the
Indebtedness, the Borrower shall execute and deliver to the Agent or cause to
be executed and delivered to the Agent, on or before the first Advance Date,
the following Security Documents in such forms and containing such terms and
conditions as the Agent shall require:-

 

9.1           the Mortgages and Deed of Covenants a first
preferred and/or first priority mortgage together, where applicable, with a
collateral deed of covenants, over each Vessel;

 

9.2           the Assignments a deed of assignment of the
Insurances, Earnings and Requisition Compensation of each Vessel; and

 

40

 

9.3           the Shipowners’ Guarantee the joint and
several guarantee and indemnity of the Shipowning Guarantors.

 

10            Agency and Trust

 

10.1         Appointment Each of the Banks, the Lead
Arrangers, the Arrangers and the Co-Arranger appoints the Agent its agent for
the purpose of administering the Facility and the Security Trustee for the
purpose of administering the Security Documents and authorises the Agent and/or
the Security Trustee (as the case may be) and their directors, officers,
employees and agents acting on the instructions from time to time of an
Instructing Group, and subject to Clauses 10.4 and 10.19, to execute the
Security Documents on its behalf and to exercise all rights, powers,
discretions and remedies vested in the Banks under or pursuant to the Security
Documents, together with all powers reasonably incidental to them.

 

10.2         Authority Subject to Clause 10.4, each of the
Banks, the Lead Arranger, the Arrangers and the Co-Arranger irrevocably
authorises the Agent and/or the Security Trustee (as the case may be), acting
on the instructions from time to time of an Instructing Group:-

 

10.2.1      to give or withhold any consents or approvals;
and

 

10.2.2      to exercise, or refrain from exercising, any
discretions; and

 

10.2.3      to collect, receive, release or pay any money;

 

under or pursuant to any of the Security
Documents and, subject to Clause 10.4, to amend any covenant contained in this
Agreement. Neither the Agent nor the Security Trustee shall have duties or
responsibilities as agent or as security trustee other than those expressly
conferred on it by the Security Documents and shall not be obliged to act on
any instructions if to do so would, in the opinion of the Agent or the Security
Trustee (as the case may be), be contrary to any provision of the Security
Documents or to any law, or would expose the Agent or the Security Trustee to
any actual or potential liability to any third party.

 

10.3         Trust The Security Trustee agrees and
declares, and each of the Banks acknowledges, that, subject to the terms and
conditions of this Clause, the Security Trustee holds the Trust Property on
trust for the Banks, in accordance

 

41

 

with their respective Proportionate Shares,
absolutely. Each of the Banks agrees that the obligations, rights and benefits
vested in the Security Trustee shall be performed and exercised in accordance
with this Clause. The Security Trustee shall have the benefit of all the powers
and discretions conferred on trustees by the Trustee Act 1925 (to the extent
not inconsistent with this Agreement). In addition:-

 

10.3.1      the Security Trustee (and any attorney, agent or
delegate of the Security Trustee) may indemnify itself or himself out of the
Trust Property against all liabilities, costs, fees, damages, charges, losses
and expenses sustained or incurred by it or him in relation to the taking or
holding of any of the Trust Property or in connection with the exercise or
purported exercise of the rights, trusts, powers and discretions vested in the
Security Trustee or any other such person by or pursuant to the Security
Documents or in respect of anything else done or omitted to be done in any way
relating to the Security Documents; and

 

10.3.2      the Banks acknowledge that the Security Trustee
shall be under no obligation to insure any property nor to require any other
person to insure any property and shall not be responsible for any loss which
may be suffered by any person as a result of the lack or insufficiency of any
insurance; and

 

10.3.3      the Security Trustee, the Agent and the Banks
agree that the perpetuity period applicable to the trusts declared by this
Agreement shall be the period of eighty years from the Execution Date.

 

10.4         Limitations on authority Except with the prior
written consent of each of the Banks, neither the Agent nor the Security
Trustee shall be entitled to :-

 

10.4.1      release or vary any security given for the Borrower’s
obligations (including, without limitation, security in respect of the Vessels)
under this Agreement; nor

 

10.4.2      except as otherwise provided in this Agreement,
agree to waive the payment of any sum of money payable by any of the Security
Parties under the Security Documents; nor

 

42

 

10.4.3      change the meaning of the expression “Instructing
Group”; nor

 

10.4.4      exercise, or refrain from exercising, any
discretion, or give or withhold any consent, the exercise or giving of which
is, by the terms of this Agreement, expressly reserved to the Banks; nor

 

10.4.5      extend the due date for the payment of any sum of
money payable by any of the Security Parties under the Security Documents; nor

 

10.4.6      take or refrain from taking any step if the
effect of such action or inaction may lead to the increase of the obligations
of a Bank under any of the Security Documents (including, without limitation,
any increase in respect of its Commitment); nor

 

10.4.7      agree to change the currency in which any sum is
payable under the Security Documents (other than in accordance with the terms
of the Security Documents); nor

 

10.4.8      agree to amend this Clause 10.4; nor

 

10.4.9      agree to amend Clauses 1.1.63 (Margin), 6.3, 8.2
or 12; nor

 

10.4.10    agree to increase the Maximum Facility Amount.

 

10.5         Liability Neither the Agent, the Security
Trustee nor any of their directors, officers, employees or agents shall be
liable to the Banks, the Lead Arrangers, the Arrangers or the Co-Arranger for
anything done or omitted to be done by the Agent or the Security Trustee (as
the case may be) under or in connection with the Security Documents unless as a
result of the Agent’s or the Security Trustee’s wilful misconduct or gross
negligence.

 

10.6         Acknowledgement Each of the Banks, the Lead
Arrangers, the Arrangers and the Co-Arranger acknowledges that:-

 

10.6.1      it has not relied on any representation made by
the Agent or the Security Trustee or any of the Agent’s or the Security
Trustee’s directors, officers, employees or agents or by any other person
acting or purporting to act on behalf of the Agent or the Security Trustee (as
the case may be) to induce it to enter into any of the Security Documents;

 

43

 

10.6.2      it has made and will continue to make without
reliance on the Agent, and based on such documents and other evidence as it
considers appropriate, its own independent investigation of the financial
condition and affairs of the Security Parties in connection with the making and
continuation of the Facility;

 

10.6.3      it has made its own appraisal of the
creditworthiness of the Security Parties;

 

10.6.4      neither the Agent nor the Security Trustee (as
the case may be) shall have any duty or responsibility at any time to provide
it with any credit or other information relating to any of the Security Parties
unless that information is received by the Agent or the Security Trustee (as
the case may be) pursuant to the express terms of the Security Documents.

 

Each of the Banks, the Lead Arrangers, the
Arrangers and the Co-Arranger agrees that it will not assert nor seek to assert
against any director, officer, employee or agent of the Agent or the Security
Trustee (as the case may be) or against any other person acting or purporting
to act on behalf of the Agent or the Security Trustee (as the case may be) any
claim which it might have against them in respect of any of the matters
referred to in this Clause.

 

10.7         Limitations on responsibility Neither the Agent
nor the Security Trustee shall have any responsibility to any of the Security
Parties or to the Banks, the Lead Arrangers, the Arrangers or the Co-Arranger
on account of:-

 

10.7.1      the failure of a Bank or of any of the Security
Parties to perform any of their respective obligations under the Security
Documents;

 

10.7.2      the financial condition of any of the Security
Parties;

 

10.7.3      the completeness or accuracy of any statements,
representations or warranties made in or pursuant to any of the Security Documents,
or in or pursuant to any document delivered pursuant to or in connection with
any of the Security Documents;

 

10.7.4      the negotiation, execution, effectiveness,
genuineness, validity, enforceability, admissibility in evidence or sufficiency
of any of the

 

44

 

Security Documents or of any document
executed or delivered pursuant to or in connection with any of the Security
Documents.

 

10.8         The Agent’s and Security Trustee’s rights The
Agent and the Security Trustee may:-

 

10.8.1      assume that all representations or warranties
made or deemed repeated by any of the Security Parties in or pursuant to any of
the Security Documents are true and complete, unless, in its capacity as the
Agent or as the Security Trustee (as the case may be), it has acquired actual
knowledge to the contrary; and

 

10.8.2      assume that no Event of Default or Potential
Event of Default has occurred unless, in its capacity as the Agent or as the
Security Trustee (as the case may be), it has acquired actual knowledge to the
contrary; and

 

10.8.3      rely on any document or Communication believed by
it to be genuine; and

 

10.8.4      rely as to legal or other professional matters on
opinions and statements of any legal or other professional advisers selected or
approved by it; and

 

10.8.5      rely as to any factual matters which might
reasonably be expected to be within the knowledge of any of the Security
Parties on a certificate signed by or on behalf of that Security Party; and

 

10.8.6      refrain from exercising any right, power,
discretion or remedy unless and until instructed to exercise that right, power,
discretion or remedy and as to the manner of its exercise by the Banks (or,
where applicable, by an Instructing Group) and unless and until the Agent or
the Security Trustee, as appropriate, has received from the Banks any payment
which the Agent, or the Security Trustee, as appropriate, may require on
account of, or any security which the Agent, or the Security Trustee, as
appropriate, may require for, any costs, claims, expenses (including legal and
other professional fees) and liabilities which it considers it may incur or
sustain in complying with those instructions.

 

45

 

10.9         The Agent’s and the Security Trustee’s duties
The Agent and the Security Trustee shall:-

 

10.9.1      if requested in writing to do so by an
Instructing Group, make enquiry and advise the Banks as to the performance or
observance of any of the provisions of the Security Documents by any of the
Security Parties or as to the existence of an Event of Default; and

 

10.9.2      inform the Banks promptly of any Event of Default
of which the Agent or the Security Trustee (as the case may be) has actual
knowledge.

 

10.10       No deemed knowledge Neither the Agent nor the
Security Trustee shall be deemed to have actual knowledge of the falsehood or
incompleteness of any representation or warranty made or deemed repeated by any
of the Security Parties or actual knowledge of the occurrence of any Event of Default
or Potential Event of Default unless a Bank or any of the Security Parties
shall have given written notice thereof to the Agent or the Security Trustee
(as the case may be).

 

10.11       Other business Each of the Agent and the
Security Trustee may, without any liability to account to the Banks, the Lead
Arrangers, the Arrangers or the Co-Arranger generally engage in any kind of
banking or trust business with any of the Security Parties or any of their
respective Subsidiaries or associated companies or with a Bank as if it were
not the Agent or the Security Trustee (as the case may be).

 

10.12       Indemnity The Banks shall, promptly on the
Agent’s or the Security Trustee’s (as the case may be) request, reimburse the
Agent or the Security Trustee (as the case may be) in their respective
Proportionate Shares, for, and keep the Agent or the Security Trustee (as the
case may be) fully indemnified in respect of:-

 

10.12.1    all amounts payable by the Borrower to the Agent
pursuant to Clause 18 to the extent that those amounts are not paid by the
Borrower;

 

10.12.2    all liabilities, damages, costs and claims
sustained or incurred by the Agent or the Security Trustee, as appropriate, in
connection with the Security Documents, or the performance of its duties and
obligations, or the exercise of its rights, powers, discretions or remedies
under or pursuant to any of the Security Documents; or in connection with any

 

46

 

action taken or omitted by the Agent or the
Security Trustee (as the case may be) under or pursuant to any of the Security
Documents, unless in any case those liabilities, damages, costs or claims arise
solely from the Agent’s or the Security Trustee’s wilful misconduct or gross
negligence.

 

10.13       Employment of agents In performing its duties
and exercising its rights, powers, discretions and remedies under or pursuant
to the Security Documents, the Agent or the Security Trustee (as the case may
be) shall be entitled to employ and pay agents to do anything which the Agent
or the Security Trustee (as the case may be) is empowered to do under or
pursuant to the Security Documents (including the receipt of money and
documents and the payment of money) and to act or refrain from taking action in
reliance on the opinion of, or advice or information obtained from, any lawyer,
banker, broker, accountant, valuer or any other person believed by the Agent or
the Security Trustee (as the case may be) in good faith to be competent to give
such opinion, advice or information.

 

10.14       Distribution of payments Every sum of money
received by the Security Trustee under or pursuant to the Security Documents
shall be paid promptly to the order of the Agent. The Agent shall pay promptly
to the order of each of the Banks that Bank’s Proportionate Share of every sum
of money received by the Agent from the Security Trustee or otherwise pursuant
to the Security Documents or the Mortgagees’ Insurances (with the exception of
(a) any amounts payable pursuant to Clause 8.1 and/or the Fee Letter or (b) any
amounts which, by the terms of the Security Documents, are paid to the Agent
for the account of the Agent alone or specifically for the account of one or
more Banks, Lead Arrangers, Arrangers or Co-Arranger) which, until so paid,
shall be held by the Agent or the Security Trustee on trust absolutely for that
Bank, that Lead Arranger, that Arranger or the Co-Arranger (as the case may
be).

 

10.15       Reimbursement Neither the Agent nor the Security
Trustee shall have any liability to pay any sum to any Finance Party or
Security Party until it has itself received payment of that sum. If, however,
the Agent or the Security Trustee (as the case may be) does pay any sum to any
Finance Party or Security Party on account of any amount prospectively due to
it pursuant to Clause 10.14 before it has itself received payment of that
amount, and the Agent or the Security Trustee (as the case may be) does not in
fact receive payment within five Business Days

 

47

 

after the date on which that payment was
required to be made by the terms of the Security Documents or the Mortgagees’
Insurances, the recipient will, on demand by the Agent or the Security Trustee
(as the case may be), refund to the Agent or Security Trustee (as appropriate)
an amount equal to the amount received by it, together with an amount
sufficient to reimburse the Agent or the Security Trustee (as the case may be)
for any amount which the Agent or the Security Trustee (as the case may be) may
certify that it has been required to pay by way of interest on money borrowed
to fund the amount in question during the period beginning on the date on which
that amount was required to be paid by the terms of the Security Documents or
the Mortgagees’ Insurances and ending on the date on which the Agent or the
Security Trustee (as appropriate) receives reimbursement.

 

10.16       Redistribution of payments Unless otherwise
agreed between the Finance Parties, if at any time a Bank receives or recovers
by way of set-off, the exercise of any lien or otherwise (other than from any
assignee or transferee of or sub-participant in that Bank’s Commitment), an
amount greater than that Bank’s Proportionate Share of any sum due from any of
the Security Parties under the Security Documents (the amount of the excess
being referred to in this Clause as the “Excess Amount”) then:-

 

10.16.1    that Bank shall promptly notify the Agent (which
shall promptly notify each other Bank);

 

10.16.2    that Bank shall pay to the Agent an amount equal to
the Excess Amount within ten days of its receipt or recovery of the Excess
Amount; and

 

10.16.3    the Agent shall treat that payment as if it were a
payment by the Security Party in question on account of the sum owed to the
Banks as aforesaid and shall account to the Banks in respect of the Excess
Amount in accordance with the provisions of this Clause.

 

However, if a Bank has commenced any
Proceedings to recover sums owing to it under the Security Documents and, as a
result of, or in connection with, those Proceedings has received an Excess
Amount, the Agent shall not distribute any of that Excess Amount to any other
Bank which had been notified of the Proceedings and had the legal right to, but
did not, join those Proceedings or

 

48

 

commence and diligently prosecute separate
Proceedings to enforce its rights in the same or another court.

 

10.17       Rescission of Excess Amount If all or any part
of any Excess Amount is rescinded or must otherwise be restored to any of the
Security Parties or to any other third party, the Banks which have received any
part of that Excess Amount by way of distribution from the Agent pursuant to
this Clause shall repay to the Agent for the account of the Bank which
originally received or recovered the Excess Amount, the amount which shall be
necessary to ensure that the Banks share rateably in accordance with their
Proportionate Shares (or, as appropriate, their Security Shares) in the amount
of the receipt or payment retained, together with interest on that amount at a
rate equivalent to that (if any) paid by the Bank receiving or recovering the
Excess Amount to the person to whom that Bank is liable to make payment in
respect of such amount, and Clause 10.16.3 shall apply only to the retained
amount.

 

10.18       Proceedings Each of the Finance Parties shall
notify the Agent of the proposed commencement of any Proceedings under any of
the Security Documents prior to their commencement. No such Proceedings may be
commenced without the prior written consent of an Instructing Group.

 

10.19       Instructions Where the Agent or the Security
Trustee is authorised or directed to act or refrain from acting in accordance
with the instructions of the Banks or of an Instructing Group each of the Banks
shall provide the Agent or the Security Trustee (as the case may be) with
instructions within five Business Days of the Agent’s or the Security Trustee’s
request (which request shall be made in writing). If a Bank does not provide
the Agent or the Security Trustee (as the case may be) with instructions within
that period, (i) that Bank shall be bound by the decision of the Agent or the
Security Trustee (as the case may be), (ii) that Bank shall have no vote for
the purposes of this Clause and (iii) the combined Proportionate Shares of the
other Banks who provided such instructions shall be deemed to contribute 100%.
Nothing in this Clause shall limit the right of the Agent or the Security
Trustee (as the case may be) to take, or refrain from taking, any action
without obtaining the instructions of the Banks if the Agent or the Security
Trustee (as the case may be) in its discretion considers it necessary or
appropriate to take, or refrain from taking, such action in order to preserve
the rights of the

 

49

 

Banks under or in connection with the
Security Documents. In that event, the Agent or the Security Trustee (as the
case may be) will notify the Banks of the action taken by it as soon as
reasonably practicable, and the Banks agree to ratify any action taken by the
Agent or the Security Trustee (as the case may be) pursuant to this Clause.

 

10.20       Communications Any Communication under this
Clause shall be given, delivered, made or served, in the case of the Agent (in
its capacity as Agent or as one of the Banks), in the case of the Security
Trustee (in its capacity as Security Trustee or as one of the Banks) and in the
case of the other Banks, at the address indicated in Schedule 1 or such other
addresses as shall be duly notified in writing to the Agent on behalf of the
Banks.

 

10.21       Payments All amounts payable to a Bank under
this Clause shall be paid to such account at such bank as that Bank may from
time to time direct in writing to the Agent.

 

10.22       Retirement Subject to a successor being
appointed in accordance with this Clause, the Agent or the Security Trustee may
retire as agent or security trustee (as the case may be) at any time without
assigning any reason by giving to the Borrower and the other Finance Parties notice
of its intention to do so, in which event the following shall apply:-

 

10.22.1    the Agent or the Security Trustee may, by not less
than fourteen days’ notice to each of the other parties to this Agreement,
appoint any holding or subsidiary company of the Agent or the Security Trustee,
or any other subsidiary (direct or indirect) of the Agent’s ultimate holding
company as its successor;

 

10.22.2    if the Agent or the Security Trustee does not
appoint a successor in accordance with Clause 10.22.1, an Instructing Group
may, with the consent of the Borrower, not to be unreasonably withheld, within
thirty days after the date of the Agent’s or the Security Trustee’s notice
appoint a successor to act as agent and/or security trustee or, if they fail to
do so, the Agent or the Security Trustee (as the case may be) may, with the
consent of the Borrower, not to be unreasonably withheld, appoint any other
bank or financial institution as its successor;

 

50

 

10.22.3    the resignation of the Agent or the Security
Trustee shall take effect simultaneously with the appointment of its successor
on written notice of that appointment being given to the Borrower and the other
Finance Parties;

 

10.22.4    the Agent or the Security Trustee (as the case may
be) shall thereupon be discharged from all further obligations as agent or
security trustee but shall remain entitled to the benefit of the provisions of
this Clause;

 

10.22.5    the Agent’s or the Security Trustee’s successor and
each of the other parties to this Agreement shall have the same rights and
obligations amongst themselves as they would have had if that successor had
been a party to this Agreement.

 

10.23       No fiduciary relationship Except as provided in
Clauses 10.3 and 10.14, neither the Agent nor the Security Trustee shall have
any fiduciary relationship with or be deemed to be a trustee of or for a Bank,
a Lead Arranger, an Arranger or the Co-Arranger (as the case may be) and
nothing contained in any of the Security Documents shall constitute a
partnership between any two or more Banks, Lead Arrangers, Arrangers or the
Co-Arranger or between the Agent or the Security Trustee and any Bank, Lead
Arranger, Arranger or the Co-Arranger (as the case may be).

 

11            Covenants

 

Each of the Borrower and SNSA covenants with
the Finance Parties in the following terms.

 

11.1         Negative covenants

 

Neither the Borrower nor SNSA, will:-

 

11.1.1      no third party rights without the Banks’ prior
written consent permit any of the Shipowning Guarantors to create or permit to
arise or continue any Encumbrance on or over all or any part of its assets or
undertaking (including, without limitation, accounts receivable) other than
Permitted Liens; nor

 

51

 

11.1.2      no change in management without the prior written
consent of an Instructing Group, permit the appointment of anyone other than
the Managers as commercial or technical managers of the Vessels, nor terminate
or amend any Management Agreement and/or the arrangements for the commercial or
technical management of the Vessels in a manner which is, in the reasonable
opinion of the Agent, detrimental to the interest of the Finance Parties or any
of them, nor permit the Managers to sub-contract or delegate the commercial or
technical management of any Vessel to any third party outside the SNSA Group
provided that any termination or amendment of any Management Agreement and/or
management arrangements referred to above with a member of the SNSA Group shall
not be deemed to be detrimental to the interests of the Finance Parties or any
of them where any new manager (being within the SNSA Group) enters into an
agreement with the Agent subordinating its rights in the Vessels to those of
the Banks in terms substantially the same as contained in Schedule 6 Part A
where the new Manager is also a bareboat charterer of any Vessel and Schedule 6
Part B where the new Manager is a manager only of any Vessel; nor

 

11.1.3      merger or amalgamation without the prior written
consent of an Instructing Group, permit any merger or amalgamation of all or
part of any Security Party unless (i) the Security Party in question remains
the surviving entity following any such merger or amalgamation (or if the
merger or amalgamation involves more than one of the Shipowning Guarantors,
that one of the Shipowning Guarantors remains the surviving entity); and (ii)
such surviving entity is not divested of any material part of the assets or
operations of the merging or amalgamating entities with its core business of
chemical transportation maintained; and (iii) in the case of SNSA only, such
merger or amalgamation has been approved by a duly passed resolution of SNSA’s
shareholders if required by applicable law; nor

 

11.1.4      no sale of Vessels/Shipowning Guarantors without
the prior written consent of the Banks sell or cause to be sold or dispose or
cause to be disposed of in whole or in part any Vessel or the shares in any

 

52

 

Shipowning Guarantor nor agree to do so
unless (i) after the sale or disposal the Security Parties remain in full
compliance with all other terms of the Security Documents or (ii) if the sale
is of a Vessel, the sale or disposal, in whole or in part, is made to a member
of the SNSA Group approved by the Agent (which approval will not be
unreasonably withheld) which will become a Shipowning Guarantor upon the
acquisition of such Vessel and which will execute and deliver to the Agent a
Shipowner’s Guarantee, a Mortgage, a Deed of Covenants (if required by the
Agent) and an Assignment in respect of such Vessel in substantially the same
terms as those Security Documents already executed in favour of and delivered
to the Agent which shall be accompanied by such corporate documents and legal
opinions as the Agent may request (and upon any sale or disposal of a
Shipowning Guarantor or all of its Vessels such Shipowning Guarantor’s
obligations under the Security Documents to which it is a party will terminate
provided that no Event of Default has occurred and the provisions of this
Clause 11.1.4 (i) or (ii), as the case may be, have been fully complied with)
or (iii) any such Vessel is replaced by a similar asset acceptable to the Banks
in their sole discretion of equal or greater value; nor

 

11.1.5      sale of other assets procure that no member of
the SNSA Group shall, without the prior written consent of an Instructing
Group, sell, lease, transfer or otherwise dispose of, by one or more
transactions or series of transactions (whether related or not) the whole or
any part of its property or assets (other than in accordance with Clause
11.1.4) except on arm’s length commercial terms or to another member of the
SNSA Group.

 

11.1.6      restrictions on investment except as expressly
permitted in this Clause 11.1.6 or as permitted by an Instructing Group, make
any Investment or permit any of its Subsidiaries to make any Investments in a
non-consolidated entity and/or in business areas other than the core business
of the transportation, storage and distribution of bulk liquid chemicals and
other products customary for chemical and product tankers, including without
limitation:-

 

53

 

(a)   no further Investments in SOSA except (i) in
relation to the conversion of the Borrower’s subordinated shareholder loan of
fifty million Dollars ($50,000,000) into SOSA equity and (ii) the guarantee of
SOSA obligations up to a maximum aggregate amount not exceeding $96,000,000
which may arise from time to time under (a) a guarantee and indemnity in favour
of Nordea Bank Norge ASA dated 30 June 2003 of certain obligations arising
under a secured $100,000,000 bank loan and guarantee facility agreement amended
and restated on 30 June 2003 (b) a guarantee and indemnity in favour of DnB NOR
Bank ASA dated 21 August 2003 of certain obligations arising under a secured
$44,000,000 bank guarantee facility agreement dated 21 August 2003 (c) a
guarantee and indemnity dated 27 August 2003 in favour of DnB NOR Bank ASA of
certain obligations arising under a $28,000,000 reimbursement agreement dated
27 August 2003 and/or (d) a guarantee and indemnity dated 20 February 2004 in
favour of HSBC Bank plc of certain obligations arising under a $100,000,000
bonding line facility agreement dated 20 February 2004, provided that the
guarantees referred in (a), (b), (c) and (d) above shall not be extended beyond
the relevant termination dates specified, as at the date of this Agreement, for
and in the various facilities referred to in (a), (b), (c) and (d) above;

 

(b)   no Investments in excess of an aggregate amount of
two million Dollars ($2,000,000) per annum except (i) where SNSA has, on a
consolidated basis, freely available Liquidity in excess of fifty million
Dollars ($50,000,000) after such Investment and (ii) for Investments by Stolt
Sea Farm plc in any of its Subsidiaries or any other entity or project within
the sea farming industry; nor

 

11.1.7      SOSA Liquidity Line make any advances to SOSA
under the SOSA Liquidity Line nor grant any time extensions on the availability
of the SOSA Liquidity Line beyond 30 November 2004.

 

54

 

11.1.8      Purchase of Margin Stock utilise all or any part
of the Facility for the purchase of Margin Stock as that term is defined in
Regulation U of the United States Board of Governors of the Federal Reserve
System.

 

11.2         Positive covenants

 

11.2.1      Registration of Vessels Each of the Borrower and
SNSA undertakes to procure the maintenance of the registration of the Vessels
under the flags and ownerships indicated in Schedule 3 for the duration of the
Facility Period unless otherwise approved by an Instructing Group in writing.

 

11.2.2      Additional security If and so often as the
aggregate of Fair Market Value of the Vessels plus the value of any additional
security (other than cash) for the time being provided to the Banks (or to the
Agent or the Security Trustee on their behalf) pursuant to this Clause shall be
less than one hundred and twenty-five per centum (125%) of the Facility
Outstandings (less the amount of any cash deposited as additional security
pursuant to this Clause) the Borrower will, within ten (10) days of the request
of the Agent to do so (the “Option Period”), at the Borrower’s option:-

 

(a)   advise the Agent that it will pay to the Agent or to
its nominee a cash deposit in the amount of the shortfall to be secured in
favour of the Banks (or of the Agent or the Security Trustee on their behalf)
as additional security for the payment of the Indebtedness, such cash deposit
to be provided within two (2) Business Days of the end of the Option Period; or

 

(b)   advise the Agent that it will give to the Banks (or
to the Agent or the Security Trustee on their behalf) other additional security
in amount and form acceptable to the Banks in their discretion, such additional
security to be delivered and registered within twenty days of the end of the
Option Period; or

 

(c)   advise the Agent that it will prepay the amount of
the Indebtedness which will ensure that the aggregate of the Fair

 

55

 

Market Value of the Vessels plus the value of
any such additional security (other than cash) is not less than one hundred and
twenty-five per centum (125%) of the Facility Outstandings (less the amount of
any cash deposited as additional security pursuant to this Clause), such
prepayment to be made within five days of the end of the Option Period.

 

For the purpose of determining the value of a
Vessel under this Clause, where such Vessel constitutes a Total Loss its value
shall be deemed to be the lesser of (i) the last Valuation in respect of that
Vessel prior to it becoming a Total Loss or (ii) the amount of insurance
proceeds reasonably expected to be paid in respect of any insurance claim
relating to the Total Loss of such Vessel.

 

Clauses 5.3, 5.4 and 5.5 shall apply, mutatis
mutandis, to any prepayment made pursuant to this Clause and the value of any
additional security provided pursuant to this Clause shall be determined by (i)
the Agent, in relation to any cash deposit, (ii) a Valuation in relation to any
new ship security and (iii) an Instructing Group in their discretion in respect
of any other security. Where the Borrower has provided additional security
pursuant to this Clause, the Borrower may request that the Agent obtain new
Valuations thereon (provided that with respect to Vessels utilised as
additional security, the procedure for obtaining Valuations shall be followed)
on a date falling not earlier than six months after the date such additional security
was provided. If the aggregate of the new Valuations of the Vessels plus the
value of any additional security (other than cash) (the “New Security Amount”)
is greater than the Security Maintenance Amount then provided that no Event of
Default has occurred and is continuing, the Agent (provided that the Agent
shall firstly release any cash collateral deposited with it pursuant to this
Clause) shall release to the Borrower, upon the Borrower’s written request and
at the Borrower’s expense, any such additional security as the Borrower selects
with the consent of the Agent (such consent not be unreasonably withheld), such
that after its release the New Security Amount will at least be equal to the
Security Maintenance Amount, provided, however, that the value of such

 

56

 

security to be released is not less than five
hundred thousand Dollars ($500,000). For the purposes of this Clause the
Borrower shall at its expense throughout the Facility Period deliver to the
Agent a Valuation in respect of each Vessel (i) at least annually after the
Execution Date and (ii) at six monthly intervals if requested by the Agent.

 

11.2.3      Financial statements The Borrower will supply to
the Agent (with sufficient copies for distribution to each of the Banks),
without request,

 

(a)   on a consolidated basis:-

 

(i)            SNSA’s annual consolidated audited accounts
prepared in accordance with US GAAP within one hundred and twenty (120) days of
the end of the fiscal year to which they relate and such financial statements
shall accurately and fairly represent the financial condition of the SNSA
Group; and

 

(ii)           SNSA’s unaudited consolidated quarterly
financial statements not later than ninety (90) days after the end of the
relevant fiscal quarter; and

 

(b)   the annual update to SNSA Group’s three year plan
when approved by SNSA’s board of directors; and

 

(c)   any other financial information (including, but not
limited to, cashflow forecasts) which may be required by the Banks.

 

11.2.4      Other information The Borrower will promptly
supply to the Agent (with sufficient copies for distribution to each of the
Banks) copies of all financial and other information from time to time given by
SNSA to its shareholders (provided that any information made available to the
public on SNSA’s World Wide Web site shall be deemed supplied for this purpose)
and such information and explanations as the Agent may from time to time
reasonably require in connection with the operation of the Vessels and the
Borrower’s and SNSA’s profit and liquidity, and will procure that the Agent be
given the like information and explanations relating to all other Security
Parties.

 

57

 

11.2.5      Evidence of current COFR Without limiting the Borrower’s
obligations under Clause 11.2.4, the Borrower will from time to time on the
request of the Agent provide the Agent with such evidence as the Agent may
reasonably require that each Vessel operating in the waters of the United
States of America has a valid and current Certificate of Financial
Responsibility pursuant to the United States Oil Pollution Act 1990.

 

11.2.6      ISM Code compliance In respect of each Vessel at
any time subject to the ISM Code the Borrower will:-

 

(a)   procure that each Vessel remains for the duration of
the Facility Period subject to a SMS;

 

(b)   maintain a valid and current SMC for each Vessel
throughout the Facility Period;

 

(c)   if it is not itself the Company, procure that the
Company maintains a valid and current DOC throughout the Facility Period;

 

(d)   promptly report to the Agent in writing of any
actual or threatened withdrawal, suspension, cancellation or modification of
any Vessel’s SMC or of the Company’s DOC;

 

(e)   promptly report to the Agent in writing (i) any
accident involving any Vessel which may result in that Vessel’s insurers making
payment directly to the Agent in accordance with the relevant Security
Documents or (ii) any “major non-conformity”, as that term is defined in the
Guidelines on the Implementation of the International Safety Management Code by
Administrations adopted by the Assembly of the International Maritime
Organisation pursuant to Resolution A.788(19), and of the steps being taken to
remedy the situation; and

 

(f)    not without the prior written consent of the Agent
(which will not be unreasonably withheld) change the identity of the Company.

 

58

 

11.2.7      ISPS Code Throughout the Facility Period the
Borrower shall procure compliance, in relation to each Vessel, with the ISPS
Code or any replacement of the ISPS Code and in particular, without limitation,
shall:-

 

(a)   procure that each Vessel and the company responsible
for that Vessel’s compliance with the ISPS Code complies with the ISPS Code;
and

 

(b)   maintain for each Vessel throughout the Facility
Period an ISSC; and

 

(c)   notify the Agent immediately in writing of any
actual or threatened withdrawal, suspension, cancellation or modification of
the ISSC for any Vessel.

 

11.2.8      Insurances The Borrower shall ensure that each of
the Vessels is fully insured upon the terms and conditions set forth in the
Mortgages or Deed of Covenants (as the case may be). In addition, each of the
Borrower and SNSA shall ensure that its property and assets are insured against
such risks and in such amounts as are customary for companies engaged in
similar businesses with reputable and financially sound insurers.

 

11.2.9      Classification The Borrower shall ensure that
each Vessel is classed and maintained as 100 A1 by Lloyd’s Register of
Shipping, or + A1 by Det norske Veritas, (in each case modified, as
appropriate, from time to time), or with the highest applicable class necessary
properly to operate such Vessel of the American Bureau of Shipping or such
other classification society acceptable to the Agent, and that such
classification will be maintained and not changed in any way during the
Facility Period, (or in the event of any change of classification immediate
steps are taken to restore such classification within one (1) month from the
date on which such change occurred).

 

11.2.10    Certificate of Compliance SNSA shall deliver to the
Agent a duly executed Certificate of Compliance ninety (90) days after the end
of each fiscal quarter of SNSA occurring during the Facility Period

 

59

 

certifying (inter alia) compliance with the
covenants contained in Clause 11.3.

 

11.2.11    Inspection of records Each of the Borrower and SNSA
will each permit the inspection of its financial records and accounts from time
to time during business hours by the Agent or its nominee.

 

11.2.12    Notification of Event of Default Each of the
Borrower and SNSA will immediately notify the Agent in writing of the
occurrence of any Event of Default or Potential Event of Default or any event
which will materially adversely affect the ability of either of the Borrower or
SNSA to perform its obligations under this Agreement or the ability of any of
the other Security Parties to perform any of their obligations under any of the
Security Documents to which they are a party or may become a party to.

 

11.2.13    Additional Filings/Notification Each of the
Borrower and SNSA shall ensure that (i) any additional filings required to
ensure continuing compliance with Clause 4.10 will be made and/or effected
promptly and within any applicable time limits imposed by law; and (ii) the
Agent is immediately notified if any of the Security Parties (a) has an
established place of business in the United Kingdom or the United States of America
at any time during the Facility Period or (b) changes the place of its chief
executive office or principal place of business in the United States of
America.

 

11.2.14    Pari Passu Each of the Borrower and SNSA shall
ensure that its respective obligations under this Agreement shall at all times
rank at least pari passu with all of its other present and future unsecured and
unsubordinated indebtedness with the exception of any obligations which are
mandatorily preferred by any applicable laws to companies generally and not by
contract.

 

11.2.15    Corporate Existence Save as permitted by Clause
11.1.3, each of the Borrower and SNSA shall ensure that throughout the Facility
Period each of the Security Parties shall (i) remain duly formed and validly
existing under the laws of its respective jurisdiction of incorporation,

 

60

 

(ii) remain authorised to do business in each
jurisdiction in which it transacts its business, (iii) continue to have the
power to carry on its business as it is now being conducted and to enter into
and perform its obligations under the Security Documents to which it is a
party, and (iv) continue to comply with all statutory, regulatory and other
requirements relative to its business which could reasonably be expected to
have a material adverse effect on its business, assets or operations, financial
or otherwise.

 

11.2.16    Admissibility In Evidence Each of the Borrower and
SNSA shall on the request of the Agent obtain all necessary authorisations,
consents, approvals, licences, exemptions, filings, registrations, recordings
and notarisations required or advisable in connection with the admissibility in
evidence of the Security Documents or any of them in Proceedings in England or
any other jurisdiction in which Proceedings have been commenced.

 

11.2.17    Compliance with law Each of the Borrower and SNSA
will comply (and will procure that each of the Shipowning Guarantors complies)
in all material respects with the requirements of all applicable laws and/or
regulations (including, without limitation, any environmental laws).

 

11.2.18    Payment of Taxes Each of the Borrower and SNSA will
ensure that all Taxes, the non-payment of which might reasonably be expected to
have a material adverse effect on the financial condition of any of the
Security Parties or of the SNSA Group are paid promptly and will provide the
Agent with details of any demand issued for such Taxes.

 

11.2.19    Maintenance of records Each of the Borrower and
SNSA will ensure that all of their accounting and other records (including
operational records relating to all vessels and containers owned by, or leased
to, members of the SNSA Group) are kept up to date and in such places as they
are easily accessible in the event that the Agent wishes to inspect them
pursuant to Clause 11.2.11.

 

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11.2.20    Restriction on Intermediary Companies Each of the
Borrower and SNSA undertake to procure that no Intermediary Company will incur
obligations which would constitute Consolidated Debt or a Synthetic Lease other
than to or from any member of the SNSA Group.

 

11.2.21    SNSA’s company Status SNSA will throughout the
Facility Period operate as a milliardaire holding company and finance holding
company under Luxembourg law pursuant to the terms of a letter of the
“Administration de l’Enregistrement et des Domaines” dated 14 September 1984.

 

11.2.22    Most Favoured Nations If any of the covenants or
events of default provided by the Borrower or SNSA to any other banks between 2
March 2004 and 30 November 2004 on vessel secured agreements for indebtedness
should be more favourable to such banks than those contained in this Agreement
or any of the Security Documents (the “Revised Terms”), the Borrower and/or
SNSA, as the case may be, shall (i) notify the Agent in writing of the Revised
Terms as soon as it becomes aware of the same and (ii) upon the request of the
Agent enter into such documents or execute such amendments to this Agreement
and/or any other Security Documents as the Agent shall require in order to
incorporate those Revised Terms (or their substantial equivalent), on a
proportional basis, into this Agreement accompanied by such legal opinions as
the Agent shall require and in the meantime this Agreement shall be deemed so
amended.

 

11.3         SNSA’s Financial Covenants Throughout the
Facility Period SNSA shall:-

 

11.3.1      maintain a Consolidated Tangible Net Worth of not
less than six hundred million Dollars ($600,000,000) or the equivalent in any
other currency;

 

11.3.2      maintain a Consolidated Debt to Consolidated
Tangible Net Worth ratio of a maximum of 2.00:1.00, with effect from the
earlier to occur of 1 June 2004 and the deconsolidation of SOSA from SNSA, as
calculated at the end of each fiscal quarter after such date; and

 

62

 

11.3.3      maintain a Consolidated EBITDA to Consolidated
Interest Expense ratio equal to or greater than 2.00:1.00 as calculated at the
end of each fiscal quarter.

 

12            Earnings

 

Remittance of earnings Immediately upon the
occurrence of an Event of Default, the Borrower shall procure that all Earnings
are paid to such account(s) as the Agent shall from time to time specify by
notice in writing to the Borrower.

 

13            Events Of Default

 

13.1         The Agent’s rights If any of the events set
out in Clause 13.2 occurs, and such event (if, in the opinion of an Instructing
Group, capable of remedy) remains unremedied for fourteen (14) days after
notice thereof has been given by the Agent to the Borrower (except in relation
to any of the events described in Clauses 13.2.1, 13.2.2, 13.2.4, 13.2.5,
13.2.6, 13.2.16, 13.2.17, 13.2.18 and 13.2.20 where such remedy period shall
not apply) the Agent (acting on the instructions of an Instructing Group) may
at its discretion by notice to the Borrower declare the Banks to be under no
further obligation to the Borrower under or pursuant to this Agreement and may
declare all or any part of the Indebtedness (including such unpaid interest as
shall have accrued) to be immediately payable, whereupon the Indebtedness (or
the part of the Indebtedness referred to in the Agent’s notice) shall
immediately become due and payable without any further demand or notice of any
kind.

 

13.2         Events of Default The events referred to in
Clause 13.1 are:-

 

13.2.1      payment default if the Borrower defaults in the
payment of any principal forming part of the Indebtedness when due or any other
part of the Indebtedness within three (3) Business Days of its due date; or

 

13.2.2      other default if any of the Security Parties
fails to observe or perform any of the covenants, conditions, undertakings,
agreements or obligations on its part contained in any of the Security
Documents or shall in any other way be in breach of or do or cause to be done
any act repudiating or evidencing an intention to repudiate any of the Security
Documents and such default (if in the reasonable opinion of an

 

63

 

Instructing Group capable of remedy) is not
remedied within fourteen (14) days after notice of the default has been given
to the Borrower; or

 

13.2.3      misrepresentation or breach of warranty if any
representation, warranty or statement made, deemed to be made, or repeated
under any of the Security Documents or in any accounts, certificate, notice,
instrument, written statement or opinion delivered by a Security Party under or
in connection with any Security Document is incorrect in any material respect
when made, deemed to be made or repeated; or

 

13.2.4      execution if a distress or execution or other
process of a court or authority is levied on any of the property of any
Security Party or Material Subsidiary before or after final judgment or by
order of any competent court or authority for an amount in excess of five
million Dollars ($5,000,000) or its equivalent in any other currency and is not
satisfied or stayed (with a view to being contested in good faith) within
fourteen (14) days of levy; or

 

13.2.5      insolvency events if any Security Party or
Material Subsidiary:-

 

(a)   resolves to appoint, or applies for, or consents to
the appointment of, a receiver, administrative receiver, trustee, administrator
or liquidator of itself or of all or part of its assets other than for the
purposes of a merger or amalgamation pursuant to Clause 11.1.3; or

 

(b)   is unable or admits its inability to pay its debts
as they fall due; or

 

(c)   makes a general assignment for the benefit of
creditors; or

 

(d)   ceases trading or threatens to cease trading (except
in the case of a Material Subsidiary as part of the ordinary course of business
or with the consent of an Instructing Group, such consent not to be
unreasonably withheld); or

 

64

 

(e)   has appointed an Inspector under the Companies Act
1985 or any statutory provision which the Agent in its discretion considers
analogous thereto; or

 

13.2.6      insolvency proceedings if any proceedings are
commenced or threatened, or any order or judgment is given by any court, for
the bankruptcy, liquidation, winding up, administration or re-organisation of
any Security Party or Material Subsidiary or for the appointment of a receiver,
administrative receiver, administrator, liquidator or trustee of any Security
Party or Material Subsidiary or of all or part of the assets of any Security
Party or Material Subsidiary, or if any person appoints or purports to appoint
such receiver, administrative receiver, administrator, liquidator or trustee
which proceeding is not discharged within thirty (30) days of its commencement;
or

 

13.2.7      impossibility or illegality subject to the terms
of Clause 16.7, if any event occurs which would, or would with the passage of
time, render performance of any of the Security Documents impossible, unlawful
or unenforceable by any of the Finance Parties; or

 

13.2.8      conditions subsequent if any of the conditions
set out in Clause 3.2 is not satisfied within the time reasonably required by
the Agent except where such condition has not been satisfied due to an act or
omission on the part of a Finance Party; or

 

13.2.9      revocation or modification of consents etc. if
any material consent, licence, approval or authorisation which is now or which
at any time during the Facility Period becomes necessary to enable any of the
Security Parties to comply with any of their obligations in or pursuant to any
of the Security Documents is revoked, withdrawn or withheld, or modified in a
manner which the Agent reasonably considers is, or may be, prejudicial to the
interests of the Banks in a material manner, or any material consent, licence,
approval or authorisation ceases to remain in full force and effect; or

 

13.2.10    curtailment of business if the business of any of
the Security Parties is wholly or partially curtailed by any intervention by or
under authority of

 

65

 

any government, or if all or a substantial
part of the undertaking, property or assets of any of the Security Parties
(other than a Vessel if it is that Security Party’s only asset) is seized,
nationalised, expropriated or compulsorily acquired by or under authority of
any government or any Security Party disposes or threatens to dispose of a
substantial part of its business or assets; or

 

13.2.11    loss of Vessel if any Vessel, or any such other
vessel which may from time to time be mortgaged to the Banks (or to the
Security Trustee on their behalf) as security for the repayment of all or any
part of the Indebtedness is destroyed, abandoned, confiscated, forfeited,
condemned as prize or otherwise becomes a Total Loss, except that a Total Loss
shall not be an Event of Default if:-

 

(a)   such Vessel or such other vessel (as the case may
be) is insured in accordance with the Security Documents; and

 

(b)   no insurer has refused to meet or has disputed the
claim for Total Loss and it is not apparent to the Agent in its discretion that
any such refusal or dispute is likely to occur; and

 

(c)   payment of the Insurance Proceeds Amount to the
Security Trustee on behalf of the Banks is made within one hundred and twenty
days of the date on which the Total Loss occurred; or

 

13.2.12    acceleration of other indebtedness if any other
indebtedness or obligation for borrowed money of any Security Party or any
Subsidiary of SNSA becomes due or capable of being declared due prior to its
stated maturity by reason of default on the part of that Security Party or
Subsidiary of SNSA (as the case may be), or is not repaid or satisfied on the
due date for its repayment or any such other loan, guarantee or indebtedness
becomes enforceable save, in either case, for amounts of less than five million
Dollars ($5,000,000) in aggregate, or its equivalent in any other currency, and
claims contested in good faith; or

 

66

 

13.2.13    reduction of capital if any of the Security Parties
reduces its authorised or issued or subscribed capital except reductions
effected in compliance with Clause 11.1.3; or

 

13.2.14    challenge to registration if the registration of
any Vessel or any Mortgage becomes void or voidable or liable to cancellation
or termination; or

 

13.2.15    war if the country of registration of any Vessel
becomes involved in war (whether or not declared) or civil war or is occupied
by any other power and the Agent reasonably considers that, as a result, the
security conferred by the Security Documents is materially prejudiced; or

 

13.2.16    notice of termination if SNSA or any Shipowning
Guarantor gives notice to the Agent to determine its obligations under the
Guarantee or the Shipowners’ Guarantee, as appropriate; or

 

13.2.17    claim against SNSA’s assets except for Permitted
Liens, if a maritime or other lien, arrest, distress or similar charge is
levied upon or against any Vessel or any substantial part of the assets of SNSA
(on a consolidated basis) and is not discharged within fourteen (14) Business
Days after any Security Party has become aware of the same; or

 

13.2.18    Borrower’s/SNSA’s business if all or a substantial
part of the Borrower’s or SNSA’s business is destroyed, abandoned, seized,
appropriated or forfeited for any reason; or

 

13.2.19    ownership if (i) the Borrower ceases to be a wholly
owned direct subsidiary of SNSA; or (ii) any Shipowning Guarantor ceases to be
100% directly or indirectly owned by SNSA; or (iii) members of the
Stolt-Nielsen family cease for any reason to own and control, directly or
indirectly, at least thirty per centum (30%) of the issued voting share capital
of SNSA; or (iv) any individual shareholder, or group of shareholders acting in
concert, outside the Stolt-Nielsen family owns a greater proportion of the
issued voting share capital of SNSA than members of the Stolt-Nielsen family;
or

 

67

 

13.2.20    final judgements if any Security Party or Material
Subsidiary fails to comply with any non appealable court order or fails to pay
a final unappealable judgement against it, in either case, in excess of five
million Dollars ($5,000,000), within fourteen (14) days; or

 

13.2.21    third party charters if any Vessel which is on
charter to a member of the SNSA Group is chartered for a period of twelve (12)
months or more to a person who is not a member of the SNSA Group; or

 

13.2.22    Core Business if either the Borrower or SNSA shall,
without the prior written consent of an Instructing Group, cease to carry on
the business of the transportation, storage and distribution of bulk liquid
chemicals and other products customary for chemical and product tankers as its
core activity.

 

14            Set-Off and Lien

 

14.1         Set-off Each of the Borrower and SNSA
irrevocably authorises the Finance Parties at any time after all or any part of
the Indebtedness shall have become due and payable to set off without notice
any liability of the Borrower or SNSA to any of the Finance Parties (whether
present or future, actual or contingent, and irrespective of the branch or
office, currency or place of payment) against any credit balance from time to
time standing on any account of the Borrower or SNSA (whether current or
otherwise and whether or not subject to notice) with any branch of any of the
Finance Parties in or towards satisfaction of the Indebtedness and, in the name
of that Finance Party, the Borrower or SNSA (as the case may be), to do all
acts (including, without limitation, converting or exchanging any currency) and
execute all documents which may be required to effect such application.

 

14.2         Lien If an Event of Default has occurred and
is continuing, each Finance Party shall have a lien on and be entitled to
retain and realise as additional security for the repayment of the Indebtedness
any cheques, drafts, bills, notes or negotiable or non-negotiable instruments
and any stocks, shares or marketable or other securities and property of any
kind of any of the Security Parties (or of that Finance Party as agent or
nominee of any of the Security Parties) from time to time held by that Finance
Party, whether for safe custody or otherwise.

 

68

 

14.3         Restrictions on withdrawal Despite any term to
the contrary in relation to any deposit or credit balance at any time on any
account of the Borrower or SNSA (as the case may be) with any of the Finance
Parties, no such deposit or balance shall be repayable or capable of being
assigned, mortgaged, charged or otherwise disposed of or dealt with by the
Borrower or SNSA (as the case may be) after an Event of Default has occurred
and while such Event of Default is continuing, but any Finance Party may from
time to time permit the withdrawal of all or any part of any such deposit or balance
without affecting the continued application of this Clause.

 

14.4         Application Whilst an Event of Default is
continuing, each of the Borrower and SNSA irrevocably authorises the Agent to
apply all sums which the Agent or the Security Trustee may receive:-

 

14.4.1      pursuant to a sale or other disposition of a
Vessel or any right, title or interest in a Vessel; or

 

14.4.2      by way of payment to the Agent of any sum in
respect of the Insurances, Earnings or Requisition Compensation of a Vessel; or

 

14.4.3      otherwise arising under or in connection with any
of the Security Documents

 

in or towards satisfaction, or by way of
retention on account, of the Indebtedness, in such manner as the Agent may in
its discretion determine.

 

15            Assignment
and Sub-Participation

 

15.1         Right to assign Each of the Banks may assign
or transfer all or any of its rights under or pursuant to the Security
Documents to any other branch of that Bank or to any other financial
institution which is a subsidiary of that Bank or which is a subsidiary (direct
or indirect) of that Bank’s ultimate holding company or to another Bank so long
as such assignment or transfer does not result in the Borrower being subject to
any additional Tax or other financial or legal obligations other than those contemplated
by the terms of this Agreement at the time of such assignment or transfer, or
(subject to the prior written consent of the Borrower (only where no Event of
Default has occurred and is continuing) and an

 

69

 

Instructing Group, which consent, in the case
of the Borrower, will not be unreasonably withheld or delayed) or any other
bank or financial institution, and each of the Banks may grant
sub-participations in all or any part of its Commitment. Unless such Bank is
assigning all of its rights, the amount of the Commitment being assigned or
transferred shall be at least two million five hundred thousand Dollars
($2,500,000) (the “Minimum Transfer Amount”). For the avoidance of doubt the
Minimum Transfer Amount shall not apply to any sub-participations granted
pursuant to Clause 15.1.

 

15.2         Borrower’s co-operation Each of the Borrower
and SNSA will co-operate fully with the Banks in connection with any
assignment, transfer or sub-participation pursuant to Clause 15.1; will execute
and procure the execution of such documents as the Banks may require in
connection therewith; and irrevocably authorises each of the Finance Parties to
disclose to any proposed assignee, transferee or sub-participant (whether before
or after any assignment, transfer or sub-participation and whether or not any
assignment, transfer or sub-participation shall take place) all information
relating to the Security Parties, the Facility or the Security Documents which
each such Finance Party may in its discretion consider necessary or desirable
(subject to any duties of confidentiality applicable to the Banks generally).

 

15.3         Rights of assignee Any assignee, transferee or
sub-participant of a Bank shall (unless limited by the express terms of the
assignment, transfer or sub-participation) take the full benefit of every
provision of the Security Documents benefiting that Bank.

 

15.4         Transfer Certificates If any Bank wishes to
transfer all or any of its Commitment as contemplated in Clause 15.1 then such
transfer may be effected by the delivery to the Agent of a duly completed and
duly executed Transfer Certificate in which event, on the later of the Transfer
Date specified in such Transfer Certificate and the fifth Business Day after the
date of delivery of such Transfer Certificate to the Agent:

 

15.4.1      to the extent that in such Transfer Certificate
the Bank which is a party thereto seeks to transfer its Commitment in whole,
the Borrower and such Bank shall be released from further obligations towards
each other under this Agreement and their respective rights against each other
shall be

 

70

 

cancelled other than existing claims against
such Bank for breach of this Agreement (such rights, benefits and obligations
being referred to in this Clause 15.4 as “discharged rights and obligations”);

 

15.4.2      the Borrower and the Transferee which is a party
thereto shall assume obligations towards one another and/or acquire rights
against one another which differ from such discharged rights and obligations
only insofar as the Borrower and such Transferee have assumed and/or acquired
the same in place of the Borrower and such Bank; and

 

15.4.3      the Agent, the Lead Arrangers, the Arrangers, the
Co-Arranger, the Transferee and the other Banks shall acquire the same rights
and benefits and assume the same obligations between themselves as they would
have acquired and assumed had such Transferee been an original party to this
Agreement as a Bank with the rights, benefits and/or obligations acquired or
assumed by it as a result of such transfer.

 

15.5         Power of Attorney In order to give effect to
each Transfer Certificate the Finance Parties and the Borrower each hereby
irrevocably and unconditionally appoint the Agent as its true and lawful
attorney with full power to execute on their respective behalves each Transfer
Certificate delivered to the Agent pursuant to Clause 15.4 without the Agent
being under any obligation to take any further instructions from or give any
prior notice to, any of the Finance Parties or, subject to the Borrower’s
rights under Clause 15.1, the Borrower and the Agent shall so execute each such
Transfer Certificate on behalf of the other Finance Parties and the Borrower
immediately on its receipt of the same pursuant to Clause 15.4.

 

15.6         Notification The Agent shall promptly notify
the other Finance Parties, the Transferee and the Borrower of the execution by
it of any Transfer Certificate together with details of the amount transferred,
the Transfer Date and the parties to such transfer.

 

15.7         Transfer Fee Each Transferee shall on the date
upon which an assignment or transfer takes effect pursuant to Clause 15.4, pay
to the Agent (for its own account) a fee of one thousand five hundred Dollars
($1,500).

 

71

 

16            Payments, Mandatory
Prepayment, Reserve Requirements and Illegality

 

16.1         Payments All amounts payable by the Borrower
and/or SNSA under or pursuant to any of the Security Documents shall be paid to
such accounts at such banks as the Agent may from time to time direct to the
Borrower or SNSA (as the case may be), and (unless payable in any other
Currency of Account) shall be paid in Dollars in same day funds (or such funds
as are required by the authorities in the United States of America for
settlement of international payments for immediate value). Payments shall be
deemed to have been received by the Agent on the date on which the Agent
receives authenticated advice of receipt for good value, unless that advice is
received by the Agent on a day other than a Business Day or at a time of day
(whether on a Business Day or not) when the Agent in its reasonable discretion
considers that it is impossible or impracticable for the Agent to utilise the
amount received for value that same day, in which event the payment in question
shall be deemed to have been received by the Agent on the Business Day next
following the date of receipt of advice by the Agent.

 

16.2         No deductions or withholdings All payments
(whether of principal or interest or otherwise) to be made by the Borrower
and/or SNSA pursuant to the Security Documents shall, subject only to Clause
16.3, be made free and clear of and without deduction for or on account of any
Taxes or other deductions, withholdings, restrictions, conditions or
counterclaims of any nature, and neither the Borrower nor SNSA will claim any
equity in respect of any payment due from it to the Banks or to the Agent under
or in relation to any of the Security Documents.

 

16.3         Grossing-up If at any time any law requires
(or is interpreted to require) the Borrower or SNSA to make any deduction or
withholding from any payment, or to change the rate or manner in which any
required deduction or withholding is made, the Borrower or SNSA (as the case
may be) will promptly notify the Agent and, simultaneously with making that
payment, will pay to the Agent whatever additional amount (after taking into
account any additional Taxes on, or deductions or withholdings from, or
restrictions or conditions on, that additional amount) is necessary to ensure
that, after making the deduction or withholding, the Finance Parties receive a
net sum equal to the sum which they would have received had no deduction or
withholding been made.

 

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16.4         Evidence of deductions If at any time either
the Borrower or SNSA is required by law to make any deduction or withholding
from any payment to be made by it pursuant to any of the Security Documents,
the Borrower or SNSA (as the case may be) will pay the amount required to be
deducted or withheld to the relevant authority within the time allowed under
the applicable law and will, no later than thirty days after making that
payment, deliver to the Agent an original receipt issued by the relevant
authority, or other evidence reasonably acceptable to the Agent, evidencing the
payment to that authority of all amounts required to be deducted or withheld.
If the Borrower makes any deduction or withholding from any payment under or
pursuant to any of the Security Documents, and a Bank subsequently receives a
refund or allowance from any tax authority which that Bank identifies as being
referable to that deduction or withholding, that Bank shall, as soon as reasonably
practicable, pay to the Borrower an amount equal to the amount of the refund or
allowance received, if and to the extent that it may do so without prejudicing
its right to retain that refund or allowance and without putting itself in any
worse financial position than that in which it would have been had the
deduction or withholding not been required to have been made. Nothing in this
Clause shall be interpreted as imposing any obligation on any Bank to apply for
any refund or allowance, nor as restricting in any way the manner in which any
Bank organises its tax affairs, nor as imposing on any Bank any obligation to
disclose to the Borrower any information regarding its tax affairs or tax
computations. All costs and expenses incurred by any Bank in obtaining or
seeking to obtain a refund or allowance from any tax authority pursuant to this
Clause shall be for the Borrower’s account.

 

16.5         Adjustment of due dates If any payment to be
made under any of the Security Documents, other than a payment of interest on
the Facility, shall be due on a day which is not a Business Day, that payment
shall be made on the next succeeding Business Day (unless the next succeeding
Business Day falls in the next calendar month in which event the payment shall
be made on the next preceding Business Day). Any such variation of time shall
be taken into account in computing any interest in respect of that payment.

 

16.6         Change in law If, by reason of the
introduction of any law, or any change in any law, or the interpretation or
administration of any law, or in compliance with any

 

73

 

request or requirement from any central bank
or any fiscal, monetary or other authority:-

 

16.6.1      any Finance Party (or the holding company of any
Finance Party) shall be subject to any Tax with respect to payments of all or
any part of the Indebtedness; or

 

16.6.2      the basis of Taxation of payments to any Finance
Party in respect of all or any part of the Indebtedness shall be changed; or

 

16.6.3      any reserve requirements shall be imposed,
modified or deemed applicable against assets held by or deposits in or for the
account of or loans by any branch of any Finance Party or its direct or
indirect holding company; or

 

16.6.4      any ratio (whether cash, capital adequacy,
liquidity or otherwise) which any Finance Party or its direct or indirect
holding company is required or requested to maintain shall be affected; or

 

16.6.5      there is imposed on any Finance Party (or on the
direct or indirect holding company of any Finance Party) any other condition in
relation to the Indebtedness or the Security Documents;

 

and the result of any of the above shall be
to increase the cost to any Bank (or to the direct or indirect holding company
of any Bank) of that Bank making or maintaining its Commitment or any Drawing,
or to cause any Finance Party to suffer (in its reasonable opinion) a material
reduction in the rate of return on its overall capital below the level which it
reasonably anticipated at the date of this Agreement and which it would have
been able to achieve but for its entering into this Agreement and/or performing
its obligations under this Agreement, the Finance Party affected shall notify
the Agent and, on demand to the Borrower by the Agent, the Borrower shall from
time to time pay to the Agent for the account of the Finance Party affected the
amount which shall compensate that Finance Party or the Agent (or the relevant
holding company) for such additional cost or reduced return. A certificate
signed by an authorised signatory of the Agent or of the Finance Party affected
setting out the amount of that payment and the basis of its calculation shall
be submitted to the Borrower and shall be conclusive

 

74

 

evidence of such amount save for manifest
error or on any question of law. Notwithstanding the foregoing, the affected
Bank shall (without any obligation on the part of such Bank to be bound)
negotiate in good faith with the Borrower to find a method to avoid any such
increase.

 

16.7         Illegality and impracticality Notwithstanding
anything contained in the Security Documents, the obligations of a Bank to
advance or maintain the Facility shall terminate in the event that a change in
any law or in the interpretation of any law by any authority charged with its
administration shall make it unlawful for that Bank to advance or maintain its
Commitment. In such event the Bank affected shall notify the Agent and the
Agent shall, by written notice to the Borrower, declare the Banks’ obligations
to be immediately terminated. If all or any part of the Facility shall have
been advanced by the Banks to the Borrower, the Indebtedness (including all
accrued interest) shall be prepaid within thirty days from the date of such notice.
Clause 5.3 shall apply to that prepayment if it is made on a day other than the
last day of an Interest Period. During that period, the affected Bank shall
negotiate in good faith with the Borrower to find an alternative method or
lending base in order to maintain the Facility.

 

16.8         Changes in market circumstances If at any time
a Bank determines (which determination shall be final and conclusive and
binding on the Borrower) that, by reason of changes affecting the London
Interbank market, adequate and fair means do not exist for ascertaining the
rate of interest on the Facility or any part thereof pursuant to this
Agreement:-

 

16.8.1      that Bank shall give notice to the Agent and the
Agent shall give notice to the Borrower of the occurrence of such event; and

 

16.8.2      the Agent shall as soon as reasonably practicable
certify to the Borrower in writing the effective cost to that Bank of
maintaining its Commitment for such further period as shall be selected by that
Bank and the rate of interest payable by the Borrower for that period; or, if
that is not acceptable to the Borrower,

 

16.8.3      the Agent in accordance with instructions from
that Bank and subject to that Bank’s approval of any agreement between the
Agent and the Borrower, will negotiate with the Borrower in good faith with a
view to

 

75

 

modifying this Agreement to provide a
substitute basis for that Bank’s Commitment which is financially a substantial
equivalent to the basis provided for in this Agreement.

 

If, within thirty days of the giving of the
notice referred to in Clause 16.8.1, the Borrower and the Agent fail to agree
in writing on a substitute basis for such Bank’s Commitment the Borrower will
immediately prepay the outstanding amount of such Bank’s Commitment and the
Maximum Facility Amount will automatically decrease by the amount of such
Commitment and such decrease shall not be reversed. Clause 5.3 shall apply to
that prepayment if it is made on a day other than the last day of an Interest
Period.

 

16.9         Non-availability of currency If a Bank is for
any reason unable to obtain Dollars in the London Interbank market and is, as a
result, or as a result of any other contingency affecting the London Interbank
market, unable to advance or maintain its Commitment in Dollars, that Bank
shall give notice to the Agent and the Agent shall give notice to the Borrower
and that Bank’s obligations to make the Facility available shall immediately
cease. In that event, if all or any part of the Facility shall have been
advanced by that Bank to the Borrower, the Agent in accordance with
instructions from that Bank and subject to that Bank’s approval of any
agreement between the Agent and the Borrower, will negotiate with the Borrower
in good faith with a view to establishing a mutually acceptable basis for
funding the Facility or relevant part thereof from an alternative source. If
the Agent and the Borrower have failed to agree in writing on a basis for
funding the Facility or relevant part thereof from an alternative source by
11.00 a.m. on the second Business Day prior to the end of the then current
relevant Interest Period, the Borrower will (without prejudice to its other
obligations under or pursuant to this Agreement, including, without limitation,
its obligation to pay interest on the Facility, arising on the expiry of the
then relevant Interest Period) prepay the Indebtedness to the Agent on behalf
of that Bank on the expiry of the then current relevant Interest Period.

 

17            Communications

 

17.1         Method Except for Communications pursuant to
Clause 10, which shall be made or given in accordance with Clause 10.20, any
Communication may be given, delivered, made or served (as the case may be)
under or in relation to this

 

76

 

Agreement by letter or fax and shall be in
the English language and sent addressed:-

 

17.1.1      in the case of any of the Finance Parties to the
Agent at its address at the head of this Agreement (fax no: +49 40 3701 4649)
marked for the attention of: Carola Maria Roth; and

 

17.1.2      in the case of the Borrower and/or SNSA to the
Communications Address with a copy to McLaughlin & Stern, LLP, 260 Madison
Avenue, New York, NY 10016, (fax no: + (212) 448-6260) Attention: John E.
Greenwood, provided that the failure to deliver such copy shall not affect the
rights of any party under this Agreement;

 

or to such other address or fax number as the
Finance Parties, the Borrower or SNSA may designate for themselves by written
notice to the others.

 

17.2         Timing A Communication shall be deemed to have
been duly given, delivered, made or served to or on, and received by a party to
this Agreement:-

 

17.2.1      in the case of a fax when the sender receives one
or more transmission reports showing the whole of the Communication to have
been transmitted to the correct fax number;

 

17.2.2      if delivered to an officer of the relevant party
or (in the case of the Borrower and/or SNSA) left at the Communications
Address, at the time of delivery or leaving; or

 

17.2.3      if posted, at 9.00 a.m. on the third Business Day
after posting by prepaid first class post.

 

18            General
Indemnities

 

18.1         Currency In the event of any Finance Party
receiving or recovering any amount payable under any of the Security Documents
in a currency other than the Currency of Account, and if the amount received or
recovered is insufficient when converted into the Currency of Account at the
date of receipt to satisfy in full the amount due, the Borrower and/or SNSA (as
the case may be) shall, on the Agent’s written demand, pay to the Agent such
further amount in the Currency of Account as is sufficient to satisfy in full
the amount due and that further amount

 

77

 

shall be due to the Agent on behalf of the
Finance Parties as a separate debt under this Agreement.

 

18.2         Costs and expenses The Borrower and SNSA will,
within fourteen (14) days of the Agent’s written demand, reimburse the Agent
(on behalf of each of the Finance Parties) for all reasonable out of pocket
expenses including external legal costs or internal legal costs in lieu thereof
(including Value Added Tax or any similar or replacement tax if applicable) of
and incidental to:-

 

18.2.1      the negotiation, syndication, preparation,
execution and registration of the Security Documents (whether or not any of the
Security Documents are actually executed or registered and whether or not all
or any part of the Facility is advanced);

 

18.2.2      any amendments, addenda or supplements to any of
the Security Documents (whether or not completed);

 

18.2.3      any other documents which may at any time be
required by any Finance Party to give effect to any of the Security Documents
or which any Finance Party is entitled to call for or obtain pursuant to any of
the Security Documents (including, without limitation, all premiums and other
sums from time to time payable by the Agent in relation to the Mortgagees’
Insurances); and

 

18.2.4      the exercise of the rights, powers, discretions
and remedies of the Finance Parties under or pursuant to the Security
Documents.

 

18.3         Events of Default The Borrower and SNSA shall
indemnify the Finance Parties from time to time on demand against all losses
and costs incurred or sustained by any Finance Party as a consequence of any
Event of Default, including (without limitation) any Break Costs.

 

18.4         Funding costs The Borrower and SNSA shall
indemnify the Finance Parties from time to time on demand against all losses
and costs incurred or sustained by any Finance Party if, for any reason due to
a default or other action by the Borrower, any Drawing is not advanced to the
Borrower after the relevant Drawdown Notice has been given to the Agent, or is
advanced on a date other

 

78

 

than that requested in the Drawdown Notice,
including (without limitation) any Break Costs.

 

18.5         Protection and enforcement The Borrower and
SNSA shall indemnify the Finance Parties from time to time on demand against
all losses, costs and liabilities which any Finance Party may from time to time
sustain, incur or become liable for in or about the protection, maintenance or
enforcement of the rights conferred on the Finance Parties by the Security
Documents or in or about the exercise or purported exercise by the Finance Parties
of any of the rights, powers, discretions or remedies vested in them under or
arising out of the Security Documents, including (without limitation) any
losses, costs and liabilities which any Finance Party may from time to time
sustain, incur or become liable for by reason of any Finance Party being
mortgagees of any Vessel and/or a lender to the Borrower, or by reason of any
Finance Party being deemed by any court or authority to be an operator or
controller, or in any way concerned in the operation or control, of any Vessel.
No such indemnity will be given to a Finance Party where any such loss, cost or
liability has occurred due to gross negligence or wilful misconduct on the part
of that Finance Party however this shall not affect the right of any other
Finance Party to receive any such indemnity.

 

18.6         Liabilities of Finance Parties The Borrower
and SNSA will from time to time reimburse the Finance Parties on demand for all
sums which any Finance Party may pay on account of any of the Security Parties
or in connection with any Vessel (whether alone or jointly or jointly and
severally with any other person) including (without limitation) all sums which
any Finance Party may pay or guarantees which any Finance Party may give in
respect of the Insurances, any expenses incurred by any Finance Party in
connection with the maintenance or repair of any Vessel or in discharging any
lien, bond or other claim relating in any way to any Vessel, and any sums which
any Finance Party may pay or guarantees which they may give to procure the
release of any Vessel from arrest or detention.

 

18.7         Taxes The Borrower and SNSA shall pay all
Taxes to which all or any part of the Indebtedness or any of the Security
Documents may be at any time subject and shall indemnify the Finance Parties on
demand against all liabilities, costs, claims and expenses resulting from any
omission to pay or delay in paying any such

 

79

 

Taxes. The indemnity contained in this Clause
shall survive the repayment of the Indebtedness.

 

19            Miscellaneous

 

19.1         Waivers No failure or delay on the part of any
Finance Party in exercising any right, power, discretion or remedy under or
pursuant to any of the Security Documents, nor any actual or alleged course of
dealing between any Finance Party and any of the Security Parties, shall
operate as a waiver of, or acquiescence in, any default on the part of any
Security Party, unless expressly agreed to do so in writing by the Agent, nor
shall any single or partial exercise by any Finance Party of any right, power,
discretion or remedy preclude any other or further exercise of that right,
power, discretion or remedy, or the exercise by a Finance Party of any other
right, power, discretion or remedy.

 

19.2         No oral variations No variation or amendment
of any of the Security Documents shall be valid unless in writing and signed on
behalf of the Finance Parties and the relevant Security Party.

 

19.3         Severability If at any time any provision of
any of the Security Documents is invalid, illegal or unenforceable in any
respect that provision shall be severed from the remainder and the validity,
legality and enforceability of the remaining provisions shall not be affected
or impaired in any way.

 

19.4         Successors etc. The Security Documents shall
be binding on the Security Parties and on their successors and permitted
transferees and assignees, and shall inure to the benefit of the Finance
Parties and their respective successors, transferees and assignees. Neither the
Borrower nor SNSA may assign or transfer any of its rights or duties under or
pursuant to any of the Security Documents without the prior written consent of
the Banks.

 

19.5         Further assurance If any provision of the
Security Documents shall be invalid or unenforceable in whole or in part by
reason of any present or future law or any decision of any court, or if the
documents at any time held by the Finance Parties on their behalf are
considered by the Banks for any reason insufficient to carry out the terms of this
Agreement, then from time to time the Borrower and/or SNSA (as the case may be)
will promptly, on demand by the Agent, execute or

 

80

 

procure the execution of such further
documents as in the reasonable opinion of the Banks are necessary to provide
adequate security for the repayment of the Indebtedness.

 

19.6         Other arrangements The Finance Parties may,
without prejudice to their rights under or pursuant to the Security Documents,
at any time and from time to time, on such terms and conditions as they may in
their discretion determine, and without notice to either the Borrower or SNSA,
grant time or other indulgence to, or compound with, any other person liable
(actually or contingently) to the Finance Parties or any of them in respect of
all or any part of the Indebtedness, and may release or renew negotiable
instruments and take and release securities and hold funds on realisation or
suspense account without affecting the liabilities of the Borrower and/or SNSA
(as the case may be) or the rights of the Finance Parties under or pursuant to
the Security Documents.

 

19.7         Advisers Each of the Borrower and SNSA
irrevocably authorise the Agent, at any time and from time to time during the
Facility Period, to consult insurance advisers on any matters relating to the
Insurances, including, without limitation, the collection of insurance claims,
and from time to time to consult or retain advisers or consultants to monitor
or advise on any other claims relating to the Vessels. The Borrower and SNSA
will provide such advisers and consultants with all information and documents
which they may from time to time reasonably require and will reimburse the
Agent on demand for all reasonable costs and expenses incurred by the Agent in
connection with the consultation or retention of such advisers or consultants.

 

19.8         Delegation The Finance Parties may at any time
and from time to time delegate to any person any of their rights, powers,
discretions and remedies pursuant to the Security Documents, other than rights
relating to actions to be taken by an Instructing Group or the Banks as a
group, on such terms as they may consider appropriate (including the power to
sub-delegate).

 

19.9         Rights etc. cumulative Every right, power, discretion
and remedy conferred on the Finance Parties under or pursuant to the Security
Documents shall be cumulative and in addition to every other right, power,
discretion or remedy to which they may at any time be entitled by law or in
equity. The Finance Parties may exercise each of their rights, powers,
discretions and remedies as often and in

 

81

 

such order as they deem appropriate subject
to obtaining the prior written consent of an Instructing Group (or, where
required by this Agreement, the Banks). The exercise or the beginning of the
exercise of any right, power, discretion or remedy shall not be interpreted as
a waiver of the right to exercise any other right, power, discretion or remedy
either simultaneously or subsequently.

 

19.10       No enquiry The Finance Parties shall not be
concerned to enquire into the powers of the Security Parties or of any person
purporting to act on behalf of any of the Security Parties, even if any of the
Security Parties or any such person shall have acted in excess of their powers
or if their actions shall have been irregular, defective or informal, whether
or not any Finance Parties had notice thereof.

 

19.11       Continuing security The security constituted by
the Security Documents shall be continuing and shall not be satisfied by any
intermediate payment or satisfaction until the Indebtedness shall have been
repaid in full and none of the Finance Parties shall be under any further
actual or contingent liability to any third party in relation to the Vessels,
the Insurances, Earnings or Requisition Compensation or any other matter
referred to in the Security Documents.

 

19.12       Security cumulative The security constituted by
the Security Documents shall be in addition to any other security now or in the
future held by the Finance Parties or any of them for or in respect of all or
any part of the Indebtedness, and shall not merge with or prejudice or be
prejudiced by any such security or any other contractual or legal rights of any
of the Finance Parties, nor affected by any irregularity, defect or
informality, or by any release, exchange or variation of any such security.
Section 93 of the Law of Property Act 1925 and all provisions which the Agent
considers analogous thereto under the law of any other relevant jurisdiction
shall not apply to the security constituted by the Security Documents.

 

19.13       Re-instatement If any Finance Party takes any
steps to exercise any of its rights, powers, remedies or discretions pursuant
to the Security Documents and the result shall be adverse to the Finance
Parties, the Borrower, SNSA and the Finance Parties shall be restored to their
former positions as if no such steps had been taken.

 

19.14       No liability None of the Finance Parties, nor
any agent or employee of any Finance Party, nor any receiver and/or manager
appointed by the Agent, shall be

 

82

 

liable for any losses which may be incurred
in or about the exercise of any of the rights, powers, discretions or remedies
of the Finance Parties under or pursuant to the Security Documents nor liable
as mortgagee in possession for any loss on realisation or for any neglect or
default of any nature for which a mortgagee in possession might otherwise be liable
unless such Finance Party’s action constitutes gross negligence or wilful
misconduct.

 

19.15       Rescission of payments etc. Any discharge,
release or reassignment by any of the Finance Parties of any of the security
constituted by, or any of the obligations of any Security Party contained in,
any of the Security Documents shall be (and be deemed always to have been) void
if any act (including, without limitation, any payment) as a result of which
such discharge, release or reassignment was given or made is subsequently
wholly or partially rescinded or avoided by operation of any law, unless such
Finance Party’s action constitutes gross negligence or wilful misconduct.

 

19.16       Subsequent Encumbrances If the Agent receives
notice of any subsequent Encumbrance (other than any Encumbrance permitted by
this Agreement) affecting any Vessel, or all or any part of the Insurances,
Earnings or Requisition Compensation, the Agent may open a new account in its
books for the Borrower. If the Agent does not open a new account, then (unless
the Encumbrance is permitted by the terms of this Agreement or the Agent gives
written notice to the contrary to the Borrower) as from the time of receipt by
the Agent of notice of such subsequent Encumbrance, all payments made to the Agent
shall be treated as having been credited to a new account of the Borrower and
not as having been applied in reduction of the Indebtedness.

 

19.17       Releases If any Finance Party shall at any time
in its discretion release any party from all or any part of any of the Security
Documents or from any term, covenant, clause, condition or obligation contained
in any of the Security Documents, the liability of any other party to the
Security Documents shall not be varied or diminished.

 

19.18       Certificates Any certificate or statement signed
by an authorised signatory of the Agent purporting to show the amount of the
Indebtedness (or any part of the Indebtedness) or any other amount referred to
in any of the Security Documents

 

83

 

shall, save for manifest error or on any
question of law, be conclusive evidence as against the Borrower or SNSA (as the
case may be) of that amount.

 

19.19       Survival of representations and warranties The
representations and warranties on the part of the Borrower and SNSA contained
in this Agreement shall survive the execution of this Agreement and the advance
of the Facility or any part thereof.

 

19.20       Counterparts This Agreement may be executed in
any number of counterparts each of which shall be original but which shall
together constitute the same.

 

19.21       Third Party Rights Notwithstanding the
provisions of the Contracts (Rights of Third Parties) Act 1999, no term of this
Agreement is enforceable by a person who is not a party to it.

 

20            Law and
Jurisdiction

 

20.1         Governing law This Agreement shall in all
respects be governed by and interpreted in accordance with English law.

 

20.2         Jurisdiction For the exclusive benefit of the
Finance Parties, the parties to this Agreement irrevocably agree that the
courts of England are to have jurisdiction to settle any disputes which may
arise out of or in connection with this Agreement and that any Proceedings may
be brought in those courts. Each of the Borrower and SNSA irrevocably waives
any objection which it may now or in the future have to the laying of the venue
of any Proceedings in any court referred to in this Clause, and any claim that
those Proceedings have been brought in an inconvenient or inappropriate forum.

 

20.3         Alternative jurisdictions Nothing contained in
this Clause shall limit the right of the Finance Parties to commence any
Proceedings against either the Borrower or SNSA in any other court of competent
jurisdiction nor shall the commencement of any Proceedings against either the Borrower
or SNSA in one or more jurisdictions preclude the commencement of any
Proceedings in any other jurisdiction, whether concurrently or not.

 

20.4         Service of process Without prejudice to the
right of the Finance Parties to use any other method of service permitted by
law, each of the Borrower and SNSA

 

84

 

irrevocably agrees that any writ, notice,
judgment or other legal process shall be sufficiently served on it if addressed
to it and left at or sent by post to the Address for Service, and in that event
shall be conclusively deemed to have been served at the time of leaving or, if
posted, at 9.00 a.m. on the third Business Day after posting by prepaid first
class registered post.

 

IN WITNESS of which the parties to this Agreement have executed this
Agreement the day and year first before written.

 

85

 

SCHEDULE 1

 

The Banks,
the Commitments and the Proportionate Shares

 

	
  The Banks

  	
   

  	
  The
  Commitments (1)

  	
   

  	
  The

  Proportionate

  Shares

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Schiffshypothekenbank zu Lubeck AG

  Brandstwiete 1, VI

  D-20457 Hamburg

  Federal Republic of Germany

  Tel: + 49 40 3701 4334

  Fax: + 49 40 3701 4649

  Contact: Carola Maria Roth

  	
   

  	
  $

  	
  22,500,000

  	
   

  	
  17.30769

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deutsche Bank AG in Hamburg

  Brandstwiete 1, VI

  D-20457 Hamburg

  Federal Republic of Germany

  Tel: + 49 40 3701 4334

  Fax: + 49 40 3701 4649

  Contact: Carola Maria Roth

  	
   

  	
  $

  	
  10,000,000

  	
   

  	
  7.69231

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  DVB Bank AG

  80 Cheapside

  London EC2V 6EE

  Tel: +44 207 618 9600

  Fax: +44 207 618 9750

  Contact: Angelique Korkodilos/Cornelia Urban

  	
   

  	
  $

  	
  32,500,000

  	
   

  	
  25

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Credit Agricole Indosuez

  Administrative Matters

  9, Quai Du President Paul Doumer

  92920 Paris La Defence

  Cedex, France

  Tel: +331 41 891249/3440

  Fax: +331 41 891934

  Contact: Sylvie Godet-Couery/Regine Maugin

  	
   

  	
  $

  	
  25,000,000

  	
   

  	
  19.23077

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Credit Agricole Indosuez Representative Office, Norway

  Credit and Commercial Matters

  Rusel0kkveien 6

  PO Box 1675, Vika 0120

  Oslo, Norway

  Tel: +47 22 01 06 50

  Fax: +47 22 01 06 51

  Contact: Jonas Gunstad

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

(1) The amount of the
Commitments will reduce pro rata if the Fair Market Value of all Vessels is
less than $130,000,000.

 

86

 

	
  KfW

  5-9 Palmengartenstrasse,

  D-60325 Frankfurt am Main,

  Federal Republic of Germany

  Tel: +49 69 7431 2898

  Fax: +49 69 7431 3768

  Contact: Claudia Schlipsing

  	
   

  	
  $

  	
  25,000,000

  	
   

  	
  19.23077

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deutsche Schiffsbank AG

  Domshof 17

  28195 Bremen, Federal Republic of Germany

  Tel: +49 421 3609 249

  Fax: +49 421 3609 329

  Contact: Malte Schulte-Trux

  	
   

  	
  $

  	
  15,000,000

  	
   

  	
  11.53846

  	
  %

  

 

87

 

SCHEDULE 2

 

PART A

 

Lead Arrangers

 

1              Deutsche Bank AG in Hamburg

Brandstwiete 1, VI

D-20457 Hamburg Federal Republic of Germany

Fax:  +49 40 3701 4649

Attention: Carola Maria Roth

 

2              Schiffshypothekenbank zu Lubeck AG

Brandstwiete 1, VI

D-20457 Hamburg

Federal Republic of Germany

Fax:  +49 40 3701 4649

Contact: Carola Maria Roth

 

3              DVB Bank AG

80 Cheapside

London EC2V 6EE

Tel:  +44 207 618 9600

Fax:  +44 207 618 9750

Contact:  Angelique Korkodilos/Cornelia
Urban

 

PART B

 

Arrangers

 

1              Credit Agricole Indosuez

Administrative Matters

9, Quai Du President Paul Doumer

92920 Paris La Defence, Cedex

France

Tel:  +331 41 891249/3440

Fax:  +331 41 891934

Contact: Sylvie Godet-Couery/Regine Maugin

 

Credit Agricole Indosuez Representative
Office Norway

Credit and Commercial Matters

Ruselokkveien 6

PO Box 1675, Vika 0120

Oslo, Norway

Tel:  +47 22 01 06 50

Fax:  +47 22 01 06 51

Contact:  Jonas Gunstad

 

88

 

2              KfW

5-9 Palmengartenstrasse,

D-60325 Frankfurt am Main,

Federal Republic of Germany

Tel:  +49 69 7431 2898

Fax:  +49 69 7431 3768

Contact:  Claudia Schlipsing

 

89

 

SCHEDULE 3

The Shipowning Guarantors and the Vessels

 

	
  Name of Mortgagor

  	
   

  	
  Name of
  Vessel

  	
   

  	
  Flag

  	
   

  	
  Dwt

  	
   

  	
  Country of

  Incorporation

  	
   

  	
  Registered
  Office

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Stolt Titan B.V.

  	
   

  	
  “STOLT TITAN”

  	
   

  	
  Liberian

  	
   

  	
  12,961

  	
   

  	
  The Netherlands

  	
   

  	
  Karel Doormanweg 25, 3115JD Schiedam,

  The Netherlands

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Stolt Aquamarine

  	
   

  	
  “STOLT AQUAMARINE”

  	
   

  	
  Cayman

  Islands

  	
   

  	
  39,000

  	
   

  	
  The Netherlands

  	
   

  	
  Karel Doormanweg 25, 3115JD Schiedam, B.V.

  The Netherlands

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Stolt Emerald B.V.

  	
   

  	
  “STOLT EMERALD”

  	
   

  	
  Cayman

  Islands

  	
   

  	
  38,720

  	
   

  	
  The Netherlands

  	
   

  	
  Karel Doormanweg 25, 3115JD Schiedam,

  The Netherlands

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Stolt Jade B.V.

  	
   

  	
  “STOLT JADE”

  	
   

  	
  Cayman

  Islands

  	
   

  	
  39,000

  	
   

  	
  The Netherlands

  	
   

  	
  Karel Doormanweg 25, 3115JD Schiedam,

  The Netherlands

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Stolt Topaz B.V.

  	
   

  	
  “STOLT TOPAZ”

  	
   

  	
  Cayman

  Islands

  	
   

  	
  38,720

  	
   

  	
  The Netherlands

  	
   

  	
  Karel Doormanweg 25, 3115JD Schiedam,

  The Netherlands

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Stolt Puffin B.V.

  	
   

  	
  “STOLT PUFFIN”

  	
   

  	
  Cayman

  Islands

  	
   

  	
  5,758

  	
   

  	
  The Netherlands

  	
   

  	
  Karel Doormanweg 25, 3115JD Schiedam,

  The Netherlands

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Stolt Kestrel B.V.

  	
   

  	
  “STOLT KESTREL”

  	
   

  	
  Cayman

  Islands

  	
   

  	
  5,758

  	
   

  	
  The Netherlands

  	
   

  	
  Karel Doormanweg 25, 3115JD Schiedam,

  The Netherlands

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Stolt Avocet B.V.

  	
   

  	
  “STOLT AVOCET”

  	
   

  	
  Cayman

  Islands

  	
   

  	
  5,758

  	
   

  	
  The Netherlands

  	
   

  	
  Karel Doormanweg 25, 3115JD Schiedam,

  The Netherlands

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Stolt Helluland B.V.

  	
   

  	
  “STOLT HELLULAND”

  	
   

  	
  Cayman

  Islands

  	
   

  	
  29,999

  	
   

  	
  The Netherlands

  	
   

  	
  Karel Doormanweg 25, 3115JD Schiedam,

  The Netherlands

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Stolt Markland B.V.

  	
   

  	
  “STOLT MARKLAND”

  	
   

  	
  Cayman

  Islands

  	
   

  	
  29,999

  	
   

  	
  The Netherlands

  	
   

  	
  Karel Doormanweg 25, 3115JD Schiedam,

  The Netherlands

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Stolt Hikawa B.V.

  	
   

  	
  “STOLT HIKAWA”

  	
   

  	
  Cayman

  Islands

  	
   

  	
  8,080

  	
   

  	
  The Netherlands

  	
   

  	
  Karel Doormanweg 25, 3115JD Schiedam,

  The Netherlands

  

 

90

 

SCHEDULE 4

 

Form of Compliance Certificate

 

STOLT NIELSEN S.A. AND SUBSIDIARIES

 

USD 130,000,000 Senior Secured Credit
Facility

 

As of and for the period ended 29 February 2004 (figures in USD
Thousands)

 

A             Consolidated
Tangible Net Worth

 

	
  Capital Stock

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Paid-in Surplus

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Retained Earnings

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  less: Treasury Stock

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  less: Intangible Assets

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Consolidated Tangible Net Worth

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Minimum Consolidated Tangible Net Worth

  	
   

  	
  600,000

  	
   

  

 

B             Consolidated
Debt

 

	
  Loans Payable to Banks

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Notes Payable

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Current Maturities of Long Term Debt

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Current Maturities of Long Term Capitalised
  Leases

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Long Term Debt (net of current portion)

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Long Term Capitalised Lease Obligations

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Acceptance Credits

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Bonds, Notes and Debentures

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Contingent Liabilities (considered probable
  and estimable)

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  less: Cash-Covered Debt

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Consolidated
  Debt

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Consolidated
  Tangible Net Worth

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Ratio of
  Consolidated Debt to Consolidated Tangible Net Worth

  	
   

  	
  —

  	
   

  
	
  Maximum
  Ratio of Consolidated Debt to Consolidated Tangible Net Worth

  	
   

  	
  2.00

  	
   

  

 

C             Consolidated
EBITDA

 

	
   

  	
   

  	
  28-Feb

  	
   

  	
  31-May

  	
   

  	
  31-Aug

  	
   

  	
  30-Nov

  	
   

  	
  Total

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Net Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Interest Expense

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  —

  	
   

  

 

91

 

	
  Taxation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Depreciation/Amortisation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EBITDA

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Consolidated EBITDA

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Consolidated Interest Expense

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ratio of Consolidated EBITDA to
  Consolidated Interest Expense

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Minimum Ratio of Consolidated EBITDA to
  Consolidated Interest Expense

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  2.00

  	
   

  

 

D             Applicable
Margin

 

Ratio of Consolidated Debt to Consolidated
EBITDA

 

	
  Less than or equal to 3

  	
   

  	
  1.50

  	
  %

  
	
  Greater than 3 but equal to or less than 4

  	
   

  	
  1.70

  	
  %

  
	
  Greater than 4 but equal to or less than 5

  	
   

  	
  1.80

  	
  %

  
	
  Greater than 5

  	
   

  	
  1.90

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Applicable Margin

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Applicable Commitment Commission

  	
   

  	
   

  	
   

  

 

E              Asset
Cover

 

	
  Original Dollar Amount of Facility

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Most recent Valuation of the Vessels

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Additional security (other than cash)

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Additional cash security

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Percentage asset cover

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Minimum asset cover

  	
   

  	
  125

  	
  %

  

 

 

	
   

  	
   

  	
  By

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  STOLT-NIELSEN S.A.

  	
   

  	
  Title

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Date

  	
   

  

 

92

 

I hereby certify that to the best of my knowledge, no Event of Default
exists and all Representations and Warranties of the Borrower and SNSA set
forth in the USD 130,000,000 Secured Revolving Loan Facility Agreement between
(amongst others) Stolt-Nielsen Transportation Group Ltd. (Liberia) (as
borrower) and Schiffshypothekenbank zu Lubeck AG (as facility agent) dated 2004
(except those appearing in Clauses 4.6, 4.7(a) and 4.13) are true and correct.

 

	
  STOLT-NIELSEN S.A.

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  
	
  Title:

  	
   

  	
   

  
	
   

  
	
  Date:

  	
   

  	
   

  
						

 

93

 

SCHEDULE 5

 

Form of Transfer Certificate

 

To:          Schiffshypotekenbank
zu Lubeck AG (the “Agent”)

 

TRANSFER CERTIFICATE

 

This transfer certificate relates to a loan facility agreement (as the
same may be from time to time amended, varied, novated or supplemented, the
“Facility Agreement”) dated [ ] 2004 whereby a revolving credit facility of up
to $130,000,000 was made available to Stolt-Nielsen Transportation Group Ltd.
(Liberia) as borrower by a group of banks on whose behalf the Agent acts as
agent and security trustee.

 

1              Terms defined in the Facility Agreement
shall, subject to any contrary indication, have the same meanings herein. The
terms “Bank” and “Transferee” are defined in the schedule to this transfer
certificate .

 

2              The Bank (i) confirms that the details in
the Schedule hereto under the heading “Bank’s Commitment” accurately summarises
its Commitment in the Facility Agreement and (ii) requests the Transferee to
accept and procure the transfer to the Transferee of the portion of such
Commitment specified in the Schedule hereto by counter-signing and delivering
the Transfer Certificate to the Agent at its address for the service of
Communications specified in the Facility Agreement.

 

3              The Transferee requests the Agent to
accept this Transfer Certificate as being delivered to the Agent pursuant to and
for the purposes of clause 15.4 of the Facility Agreement so as to take effect
in accordance with the terms thereof on the Transfer Date or on such later date
as may be determined in accordance with the terms thereof.

 

4              The Transferee confirms that it has
received a copy of the Facility Agreement together with such other information
as it has required in connection with this transaction and that it has not
relied and will not in the future rely on the Bank or any other party to the
Facility Agreement to check or enquire on its behalf into the legality,
validity, effectiveness, adequacy, accuracy or completeness of any such
information and further agrees that it has not relied and will not rely on the
Bank or any other party to the Facility Agreement to access or keep under
review on its behalf the financial condition, creditworthiness, condition,
affairs, status or nature of the Borrower or any other party to the Facility
Agreement.

 

5              Execution of this Transfer Certificate by
the Transferee constitutes its representation to the Transferor and all other
parties to the Facility Agreement that it has power to become a party to the
Facility Agreement as a Bank on the terms herein and therein set out and has
taken all steps to authorise execution and delivery of this Transfer
Certificate.

 

6              The Transferee undertakes with the Bank
and each of the other parties to the Facility Agreement that it will perform in
accordance with their terms all those obligations which by the terms of the
Facility Agreement will be assumed by it after delivery of this Transfer
Certificate to the Agent and satisfaction of the conditions (if any) subject to
which the Transfer Certificate is expressed to take effect.

 

94

 

7              The Bank makes no representation or
warranty and assumes no responsibility with respect to the legality, validity,
effectiveness, adequacy or enforceability of the Facility Agreement or any
document relating thereto and assumes no responsibility for the financial condition
of the Borrower or for the performance and observance by the Borrower of any of
its obligations under the Facility Agreement or any document relating thereto
and any and all such conditions and warranties, whether express or implied by
law or otherwise, are hereby excluded.

 

8              The Bank gives notice that nothing in
this transfer certificate or in the Facility Agreement (or any document
relating thereto) shall oblige the Bank to (i) accept a re-transfer from the
Transferee of the whole or any part of its rights, benefits and/or obligations
under the Facility Agreement transferred pursuant hereto or (ii) support any
losses directly or indirectly sustained or incurred by the Transferee for any
reason whatsoever including, without limitation, the non-performance by the
Borrower or any other party to the Facility Agreement (or any document relating
thereto) of its obligations under any such document. The Transferee
acknowledges the absence of any such obligation as is referred to in (i) or
(ii) above.

 

9              This Transfer Certificate and the rights
and obligations of the parties hereunder shall be governed by and interpreted
in accordance with English law.

 

THE SCHEDULE

 

	
  1

  	
   

  	
  Bank:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
  Transferee:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
  Transfer Date:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4

  	
   

  	
  Commitment(2):

  	
   

  	
  Portion Transferred

  

 

 

	
  [Transferor Bank]

  	
  [Transferee Bank]

  
	
   

  	
   

  
	
  By:

  	
  By:

  
	
   

  	
   

  
	
  Date:

  	
  Date:

  

 

Schiffshypotekenbank zu Lubeck AG

 

As agent for and on behalf of itself, the Borrower and the other
Finance Parties

 

 

	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  Date:
  [                                                          ]

  	
   

  

 

(2) Details of the Bank’s Commitment should not be completed after the
Termination Date.

 

95

 

SCHEDULE 6

 

PART A

 

To:          Schiffshypothekenbank zu Lubeck AG

in its capacity as security trustee

for and on behalf of the Banks

(as defined below)

 

	
   

  	
   

  	
  Date:

  	
   

  	
  200[  ]

  

 

Dear Sirs

 

US$130,000,000 Secured Revolving Loan Facility to Stolt-Nielsen
Transportation Group Ltd (Liberia)

 

1              Loan
Agreement

 

We understand that, under a Facility Agreement (the “Facility
Agreement”) dated [  ] 2004 made between (1) Stolt-Nielsen
Transportation Group Ltd (Liberia) as borrower (the “Borrower”) (2)
Stolt-Nielsen S.A. as guarantor (3) the banks and financial institutions listed
in Schedule 1 to the Facility Agreement as lenders (the “Banks”) (4) the banks
and financial institutions listed in Schedule 2 Part A to the Facility
Agreement as lead arrangers and Schedule 2 Part B to the Facility Agreement as
arrangers (5) yourselves as facility agent and security trustee (the “Agent”)
and (6) Deutsche Schiffsbank AG as co-arranger each of the Banks agreed to
advance to the Borrower its respective Commitment of an aggregate principal
amount not exceeding one hundred and thirty million Dollars ($130,000,000) (the
“Loan”) upon the terms and conditions contained in the Facility Agreement and
that it is a condition to (i) the Banks’ agreement to continue to make any part
of the Loan available to the Borrower and (ii) an Instructing Group consenting
to (a) the Vessels being bareboat chartered to us and (b) our appointment as
managers in accordance with clauses 8.1.4 and 8.1.5 respectively of the
Shipowners’ Guarantee that we (the “Manager”) enter into this letter in favour
of the Security Trustee on behalf of the Banks.

 

2              Definitions

 

Words and expressions defined in the Facility Agreement shall have the
same meanings when used herein.

 

96

 

3              Confirmation
of Appointment/ Representation & Warranties

 

3.1           The
Manager hereby confirms that:-

 

(a)           it
has been appointed as the manager of the vessels listed in the Schedule 1 to
this letter (the “Vessels”); and

 

(b)           the Vessels have been bareboat chartered to
the Manager in accordance with the terms and conditions of the bareboat
charterparties attached to this letter and marked Exhibit “A” (together the
“Charters”).

 

3.2           The Manager hereby represents and warrants
that (i) the Manager is duly incorporated in its country of incorporation and
has the power to enter into and perform its obligations under this letter and
the Charters and that this letter and the Charters constitute the legal, valid
and binding obligations of the Manager enforceable in accordance with their
respective terms and (ii) the copies of the Charters attached to this letter
are true and complete copies and constitute the entire agreement between the
Manager and the Shipowning Guarantors concerning the chartering and current
management of the Vessels by the Shipowning Guarantors to the Manager.

 

4              Undertakings

 

The Manager undertakes with the Security Trustee that:

 

(a)           subject to the provisions of clause 11.1.2
of the Facility Agreement, the Manager will remain the commercial and technical
managers of the Vessels throughout the Facility Period;

 

(b)           the Manager will manage the Vessels in
accordance with good standard ship management practice throughout the Facility
Period;

 

(c)           the Manager will not, without the prior
written consent of the Security Trustee, the Agent and/or the Banks, take any
action or institute any proceedings or make or assert any claim on or in
respect of any Vessel managed or chartered by it or its Insurances or its
Earnings or any of them or any other property or assets of any of the
Shipowning Guarantors which are subject to any Encumbrance or right of set-off
in favour of the Finance Parties or any of them by virtue of any of the
Security Documents executed in favour of the Finance Parties or any of them
pursuant to the Facility Agreement;

 

97

 

(d)           the Manager is aware that the Vessels are
mortgaged to the Security Trustee pursuant to the Mortgages and Deeds of
Covenant and is aware of the terms of the Security Documents and will not do
anything incompatible or inconsistent with the performance by the Shipowning
Guarantors of their obligations under the Security Documents to which they are
a party nor will the Manager act in a way which is detrimental or prejudicial
to the interests of the Finance Parties in relation to the Vessels, the
Earnings, the Insurances and the Requisition Compensation;

 

(e)           the Manager will promptly notify the
Security Trustee, the Agent and/or the Banks in the event that it ceases for
any reason whatsoever to be the manager or charterer of any Vessel managed or
chartered by it or if the relevant Shipowning Guarantor purports to dismiss the
Manager as manager and/or charterer of any Vessel;

 

(f)            it will notify the Security Trustee, the
Agent and/or the Banks immediately if at any time and from time to time the
amount owed by the Shipowning Guarantors to the Manager exceeds five hundred
thousand Dollars ($500,000);

 

(g)           throughout the Facility Period, all the
Manager’s rights in relation to the Vessels, their Earnings, Insurances and
Requisition Compensation shall be fully subordinated to the rights of the
Finance Parties under the Security Documents and the Manager acknowledges that
the rights of the Security Trustee pursuant to the Mortgages and the Deeds of
Covenant (including any power or right of sale, foreclosure or taking possession)
shall in all respects have priority over the rights and powers of the Manager
under the Charters;

 

(h)           if at any time a sub manager is appointed
pursuant to a Management Agreement or otherwise that the Manager will procure
that on such appointment, the sub manager enters into an undertaking with
Security Trustee, the Agent and/or the Banks in substantially the same form as
this letter;

 

(i)            the Manager shall not compete with the
Finance Parties in a liquidation or other winding-up or bankruptcy of any Shipowning
Guarantor or in any proceedings in connection with any Vessel, its Earnings or
Insurances or Requisition Compensation;

 

(j)            the Manager shall comply with all covenants
of the Shipowning Guarantors contained in clauses 5 and 6 of the Deeds of Covenants
in relation to the Vessels; and

 

(k)           the Manager shall promptly deliver to the
Security Trustee a certified copy of each Management Agreement as and when the
same is entered into.

 

98

 

5              Assignment

 

5.1   In consideration of an Instructing Group approving
the entry by the Manager and the Shipowning Guarantors into the Charters and
for other good and valuable consideration (the receipt and adequacy of which
the Manager acknowledges), the Manager, with full title guarantee, hereby
assigns absolutely and unconditionally and agrees to assign to the Security
Trustee all the Manager’s right, title and interest in and to the Insurances in
respect of each of the Vessels.

 

5.2   The Manager agrees to give written notice of the
assignment contained in paragraph 5.1 above to the relevant insurers
immediately upon execution of this letter in the form attached at Schedule 2 to
this letter.

 

5.3   The Manager agrees that at all times whilst the
Manager is the manager and/or bareboat charterer of the Vessels to ensure that
a loss payable clause in the form attached at Schedule 3 to this letter is
endorsed on all insurance policies, cover notes and certificates of entry
relating to the Vessels.

 

6              Third
Party Rights

 

Notwithstanding the provisions of the Contracts (Rights of Third
Parties) Act 1999, no term of this letter is enforceable by a person who is not
a party to it other than the Security Trustee.

 

7              Jurisdiction

 

This letter shall be governed by and construed in accordance with
English law and the Manager hereby agrees to submit to the non-exclusive
jurisdiction of the English courts.

 

99

 

	
   

  	
  Yours faithfully

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Signed and Delivered as a Deed by a

  duly authorised attorney/managing director

  For and on behalf of

  [Stolt-Nielsen Transportation Group B.V.]

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  in the presence of:-

  	
   

  	
   

  

 

100

 

Schedule 1

 

	
  Name of
  Vessel

  	
   

  	
  Owner

  	
   

  	
  Flag of
  Vessel

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

101

 

Schedule 2

 

Notice of Assignment

 

(For attachment by way of endorsement to

all policies, contracts and cover notes)

 

We, [Stolt Nielsen Transportation Group B.V.] of [Karel Doormanweg 25,
3115 JD Schiedam,] The Netherlands, the managers and bareboat charterers of the
m.v.
“[                     ]”,
m.v. “[                     ]”,
m.v.
“[                     ]”,
m.v. “[                     ],
m.v.
“[                     ]”,
m.v. “[                     ]”
and m.v.
“[                     ]”
(together the “Vessels”) GIVE NOTICE that, by an assignment in writing
contained in a letter dated 2004, we assigned to Schiffshypotekenbank zu Lubeck
AG, acting through its office at
[                                          ],
on behalf of a syndicate of banks all our right, title and interest in and to
all insurances effected or to be effected in respect of the Vessels, including
the insurances constituted by the policy on which this notice is endorsed, and
including all money payable and to become payable thereunder or in connection
therewith (including return of premiums).

 

	
  Signed:

  	
   

  	
   

  	
   

  
	
   

  	
  For and on behalf of

  	
   

  
	
   

  	
  [Stolt Nielsen Transportation Group B.V.]

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
  2004

  
					

 

102

 

Schedule 3

 

Loss Payable Clause

 

It is noted that, by an assignment in writing contained in a letter
dated
                         
2004 [STOLT NIELSEN TRANSPORTATION GROUP B.V.] of [Karel Doormanweg 25, 3115 JD
Schiedam], The Netherlands (the “Manager”), being the manager and bareboat
charterer of the vessels m.v.
“[                         ]”,
m.v. “[                         ]”,
m.v.
“[                         ]”,
m.v.
“[                         ]”,
m.v. “[                         ]”,
m.v. “[                         ]”
and m.v.
“[                         ]”
(together the “Vessels”), assigned absolutely to Schiffshypotekenbank zu Lubeck
AG acting through its office at
[                         ]
(the “Mortgagee”) this policy and all benefits of this policy, including all
claims of any nature (including return of premiums) under this policy.

 

Claims payable under this policy in respect of a total or constructive
total or an arranged or agreed or compromised total loss or unrepaired damage
and all claims which (in the opinion of the Mortgagee) are analogous thereto
shall be payable to the Mortgagee up to the Mortgagee’s mortgage interest in
accordance with clause 13.2.11 (c) of a Secured Revolving Facility Agreement
dated [                         ]
2004 made between (1) Stolt-Nielsen Transportation Group Limited (Liberia) as
borrower, (2) Stolt-Nielsen SA as guarantor, (3) the banks listed in Schedule 1
thereto as lenders (the “Banks”), (4) the banks and financial institutions
listed in Schedule 2 Part A thereto as lead arrangers and Schedule 2 Part B
thereto as arrangers (5) Schiffshypotekenbank zu Lubeck AG as facility agent
and security trustee and (6) Deutsche Schiffsbank AG as co-arranger;

 

Subject thereto, all other claims, unless and until underwriters have
received notice from the Mortgagee that an Event of Default has occurred, in
which event all claims under this policy shall be payable directly to the
Mortgagee up to the Mortgagee’s mortgage interest, shall be payable as
follows:-

 

(i)            a claim in respect of any one casualty
where the aggregate claim against all insurers does not exceed ONE MILLION
UNITED STATES DOLLARS (US$1,000,000) or the equivalent in any other currency,
prior to adjustment for any franchise or deductible under the terms of the
policy, shall be paid directly to the Manager for the repair, salvage or other
charges involved or as a reimbursement if the Manager has fully repaired the
damage and paid all of the salvage or other charges;

 

103

 

(ii)           a claim in respect of any one casualty where
the aggregate claim against all insurers exceeds ONE MILLION UNITED STATES
DOLLARS (US$1,000,000) or the equivalent in any other currency prior to
adjustment for any franchise or deductible under the terms of the policy,
shall, subject to the prior written consent of the Mortgagee, be paid to the
manager as and when the relevant Vessel is restored to her former state and
condition and the liability in respect of which the insurance loss is payable
is discharged, and provided that the insurers may with such consent make
payment on account of repairs in the course of being effected, but, in the
absence of such prior written consent shall be payable directly to the
Mortgagee up to the Mortgagee’s mortgage interest.

 

Notwithstanding the terms of this loss payable clause and
notwithstanding notice of assignment, unless and until brokers receive notice
from the Mortgagee to the contrary, brokers, underwriters/ insurers or the P
& I Club shall be empowered to arrange their proportion of any collision
and/or salvage guarantee to be given in the event of bail being required in
order to prevent the arrest of the Vessels or to secure the release of such
Vessel from arrest following a casualty.

 

All collections are to be made through [name of brokers].

 

104

 

EXHIBIT “A”

 

Bareboat Charterparties

 

105

 

PART B

 

To:          Schiffshypothekenbank zu Lubeck AG

in its capacity as security trustee

for and on behalf of the Banks

(as defined below).

 

200[  ]

 

Dear Sirs

 

US$130,000,000 Secured Revolving Loan Facility to Stolt-Nielsen
Transportation Group Ltd (Liberia)

 

1              Loan
Agreement

 

We understand that under an Revolving Loan Facility Agreement (the
“Facility Agreement”) dated
[                         ]
2004 between (1) Stolt-Nielsen Transportation Group Ltd (Liberia) as borrower
(the “Borrower”) (2) Stolt-Nielsen S.A. as guarantor (3) the banks and
financial institutions listed in Schedule 1 to the Facility Agreement as
lenders (the “Banks”) (4) the banks and financial institutions listed in
Schedule 2 Part A to the Facility Agreement as lead arrangers and Schedule 2
Part B to the Facility Agreement as arrangers (5) Schiffshypotekenbank zu
Lubeck AG as facility agent security trustee (the “Agent”) and (6) Deutsche
Schiffsbank AG as co-arranger each of the Banks agreed to advance to the
Borrower its respective Commitment of an aggregate principal amount not
exceeding one hundred and thirty million Dollars ($130,000,000) (the “Loan”)
and that it is a condition to the Banks’ agreement to continue to make any part
of the Loan available to the Borrower that we (the “Managers”) enter into this
letter in favour of the Security Trustee on behalf of the Banks.

 

2              Definitions

 

Words and expressions defined in the Facility Agreement shall have the
same meanings when used herein.

 

106

 

3              Confirmation
of Appointment/ Representation & Warranties

 

3.1           The
Managers hereby confirm that:-

 

(a)           they have been appointed as the managers of
the vessels listed in the attached Schedule (the “Vessels”); and

 

3.2           The Managers hereby represent and warrant
that the Managers are duly incorporated in their country of incorporation and
have the power to enter into and perform their obligations under this letter
and that this letter constitutes the legal, valid and binding obligations of
the Managers enforceable in accordance with its terms.

 

4              Undertakings

 

The Managers undertake with the Security Trustee that:

 

(a)           subject to the provisions of Clause 11.1.2
of the Facility Agreement, the Managers will remain the commercial and
technical managers of the Vessels throughout the Facility Period;

 

(b)           the Managers will manage the Vessels in
accordance with good standard ship management practice throughout the Facility
Period;

 

(c)           the Managers will not, without the prior
written consent of the Security Trustee, the Agent and/or the Banks, take any
action or institute any proceedings or make or assert any claim on or in
respect of any Vessel managed by it or its Insurances or its Earnings or any of
them or any other property or assets of any of the Shipowning Guarantors
subject to any Encumbrance or right of set-off in favour of the Finance Parties
or any of them by virtue of any of the Security Documents executed in favour of
the Finance Parties or any of them pursuant to the Facility Agreement;

 

(d)           the Managers will not do anything
incompatible or inconsistent with the performance by the Shipowning Guarantors
of their obligations under the Security Documents to which they are a party;

 

107

 

(e)           the Managers will promptly notify the
Security Trustee, the Agent and/or the Banks in the event that they cease for
any reason whatsoever to be the managers of any Vessel managed by it or if the
relevant Shipowning Guarantor purports to dismiss any Manager as manager of any
Vessel;

 

(f)            they will notify the Security Trustee, the
Agent and/or the Banks immediately if at any time and from time to time the
amount owed by the Shipowning Guarantors to the Managers exceeds five hundred
thousand Dollars ($500,000);

 

(g)           throughout the Facility Period, all their
rights in relation to the Vessels, their Earnings, Insurances and Requisition
Compensation shall be fully subordinated to the rights of the Finance Parties
under the Security Documents;

 

(h)           if at any time a sub manager is appointed
pursuant to a Management Agreement or otherwise that they will procure that on
such appointment, the sub manager enters into an undertaking with the Security
Trustee, the Agent and/or the Banks in substantially the same form as this
letter;

 

(i)            the Managers shall not compete with the
Finance Parties in a liquidation or other winding-up or bankruptcy of any
Shipowning Guarantor or in any proceedings in connection with any Vessel, its
Earnings or Insurances or Requisition Compensation; and

 

(j)            the Managers shall promptly deliver to the
Security Trustee a certified copy of each Management Agreement as and when the
same is entered into.

 

5              Jurisdiction

 

This letter shall be governed by and construed in accordance with
English law and the Managers hereby agree to submit to the non-exclusive
jurisdiction of the English courts.

 

	
   

  	
  Yours faithfully

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Duly authorised signatory

  For and on behalf of

  [insert name of Manager]

  	
   

  
	
   

  	
   

  	
   

  

 

108

 

Schedule

 

	
  Name of
  Vessel

  	
   

  	
  Owner

  	
   

  	
  Flag of
  Vessel

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

109

 

	
  SIGNED by

  	
  )

  	
   

  	
   

  	
   

  
	
  duly authorised for and on behalf

  	
  )

  	
   

  	
   

  	
   

  
	
  of SCHIFFSHYPOTHEKENBANK ZU

  	
  )

  	
  Signature

  	
   

  	
   

  
	
  LUBECK AG (as a Bank)

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:-

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by

  	
  )

  	
   

  	
   

  	
   

  
	
  duly authorised for and on behalf

  	
  )

  	
   

  	
   

  	
   

  
	
  of DEUTSCHE BANK AG IN HAMBURG

  	
  )

  	
  Signature

  	
   

  	
   

  
	
  (as a Bank)

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:-

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by

  	
  )

  	
   

  	
   

  	
   

  
	
  duly authorised for and on behalf

  	
  )

  	
   

  	
   

  	
   

  
	
  of CREDIT AGRICOLE INDOSUEZ

  	
  )

  	
  Signature

  	
   

  	
   

  
	
  (as a Bank)

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:-

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by

  	
  )

  	
   

  	
   

  	
   

  
	
  duly authorised for and on behalf

  	
  )

  	
   

  	
   

  	
   

  
	
  of KfW

  	
  )

  	
  Signature

  	
   

  	
   

  
	
  (as a Bank)

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:-

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by

  	
  )

  	
   

  	
   

  	
   

  
	
  duly authorised for and on behalf

  	
  )

  	
   

  	
   

  	
   

  
	
  of DEUTSCHE SCHIFFSBANK AG

  	
  )

  	
  Signature

  	
   

  	
   

  
	
  (as a Bank)

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:-

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by

  	
  )

  	
   

  	
   

  	
   

  
	
  duly authorised for and on behalf

  	
  )

  	
   

  	
   

  	
   

  
	
  of DVB BANK AG

  	
  )

  	
  Signature

  	
   

  	
   

  
	
  (as a Bank)

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:-

  	
  )

  	
   

  	
   

  	
   

  

 

110

 

	
  SIGNED by

  	
  )

  	
   

  	
   

  	
   

  
	
  duly authorised for and on behalf

  	
  )

  	
   

  	
   

  	
   

  
	
  of SCHIFFSHYPOTHEKENBANK ZU

  	
  )

  	
  Signature

  	
   

  	
   

  
	
  LUBECK AG

  	
  )

  	
   

  	
   

  	
   

  
	
  (as the Agent and Security Trustee)

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:-

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by

  	
  )

  	
   

  	
   

  	
   

  
	
  duly authorised for and on behalf

  	
  )

  	
   

  	
   

  	
   

  
	
  of DEUTSCHE BANK AG

  	
  )

  	
   

  	
   

  	
   

  
	
  IN HAMBURG

  	
  )

  	
  Signature

  	
   

  	
   

  
	
  (as a Lead Arranger)

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:-

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by

  	
  )

  	
   

  	
   

  	
   

  
	
  duly authorised for and on behalf

  	
  )

  	
   

  	
   

  	
   

  
	
  of SCHIFFSHYPOTHEKENBANK ZU

  	
  )

  	
  Signature

  	
   

  	
   

  
	
  LUBECK AG

  	
  )

  	
   

  	
   

  	
   

  
	
  (as a Lead Arranger)

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:-

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by

  	
  )

  	
   

  	
   

  	
   

  
	
  duly authorised for and on behalf

  	
  )

  	
   

  	
   

  	
   

  
	
  of DVB BANK AG

  	
  )

  	
  Signature

  	
   

  	
   

  
	
  (as a Lead Arranger)

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:-

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by

  	
  )

  	
   

  	
   

  	
   

  
	
  duly authorised for and on behalf

  	
  )

  	
   

  	
   

  	
   

  
	
  of CREDIT AGRICOLE INDOSUEZ

  	
  )

  	
  Signature

  	
   

  	
   

  
	
  (as an Arranger)

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:-

  	
  )

  	
   

  	
   

  	
   

  

 

111

 

	
  SIGNED by

  	
  )

  	
   

  	
   

  	
   

  
	
  duly authorised for and on behalf

  	
  )

  	
   

  	
   

  	
   

  
	
  of KfW

  	
  )

  	
  Signature

  	
   

  	
   

  
	
  (as an Arranger)

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:-

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by

  	
  )

  	
   

  	
   

  	
   

  
	
  duly authorised for and on behalf

  	
  )

  	
   

  	
   

  	
   

  
	
  of DEUTSCHE SCHIFFSBANK AG

  	
  )

  	
  Signature

  	
   

  	
   

  
	
  (as Co-arranger)

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:-

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by

  	
  )

  	
   

  	
   

  	
   

  
	
  duly authorised for and on behalf

  	
  )

  	
   

  	
   

  	
   

  
	
  of STOLT-NIELSEN

  	
  )

  	
   

  	
   

  	
   

  
	
  TRANSPORTATION GROUP

  	
  )

  	
  Signature

  	
   

  	
   

  
	
  LTD. (of Liberia)

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:-

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by

  	
  )

  	
   

  	
   

  	
   

  
	
  duly authorised for and on behalf

  	
  )

  	
   

  	
   

  	
   

  
	
  of STOLT-NIELSEN S.A.

  	
  )

  	
  Signature

  	
   

  	
   

  
	
  in the presence of:-

  	
  )

  	
   

  	
   

  	
   

  

 

112

 

APPENDIX A

 

To:                  Schiffshypotekenbank zu Lubeck AG

 

From:              Stolt-Nielsen Transportation Group Ltd.

 

[Date]

 

Dear Sirs,

 

Drawdown Notice

 

We refer to the Loan Facility Agreement dated
[                ]
2004 made between, amongst others, ourselves and yourselves (“the Agreement”).

 

Words and phrases defined in the Agreement
have the same meaning when used in this Drawdown Notice.

 

Pursuant to Clause 2.3 of the Agreement, we
irrevocably request that you advance a Drawing of
[                ]
to us on                                ,
which is a Business Day, by paying the amount of the Drawing to
[                                ].

 

We warrant that the representations and
warranties contained in Clause 4 of the Agreement [(except those contained in
Clauses 4.6, 4.7(a) and 4.13)](3) are true and correct at the date of this
Drawdown Notice and will be true and correct
on                                ;
that no Event of Default nor Potential Event of Default has occurred and is
continuing, and that no Event of Default or Potential Event of Default will
result from the advance of the Drawing requested in this Drawdown Notice.

 

[We further confirm and certify that no
material adverse change has occurred since
[                ]
in the business, assets, operations, condition (financial or otherwise) or
prospects of SNSA or its subsidiaries or in the facts and information regarding
such entities as represented to date(4)]

 

We select the period of
[                ]
months as the [first] Interest Period in respect of the Drawing.

 

 

	
   

  	
  Yours faithfully

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  For and on behalf of

  Stolt-Nielsen Transportation Group Ltd.

  	
   

  

 

(3) To be in subsequent Drawdown Notices only.

(4) To be in first Drawdown Notice only.

 

113

 

APPENDIX B

 

Mandatory Cost Formulae

 

1.             The Mandatory Cost is an addition to the
interest rate to compensate the 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 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 Facility) and will be
expressed as a percentage rate per annum.

 

3.             The Additional Cost Rate for any Bank
lending from a Facility 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 all loans made from that Facility Office) of complying with
the minimum reserve requirements of the European Central Bank in respect of
loans made from that Facility Office.

 

4.             The Additional Cost Rate for any Bank
lending from a Facility Office in the United Kingdom will be calculated by the
Agent as follows:

 

in relation to a loan in Dollars:

 

	
  E x 0.01

  	
   

  	
  per cent. per annum

  
	
  300

  	
   

  

 

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
(pound)1,000,000.

 

5.             For
the purpose of this Schedule:

 

(a)           “Eligible Liabilities” and “Special
Deposits” have the meanings given to them from time to time under or pursuant
to the Bank of England Act 1998 or (as may be appropriate) by the Bank of
England.

 

(b)           “Facility Office” means the office notified
by a Bank to the Agent in writing on or before the date it becomes a Bank as
the office through which it will perform its obligations under the Agreement;

 

(c)           “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;

 

114

 

(d)           “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);

 

(e)           “Participating Member State” means any
member state of the European Communities that adopt or has adopted the euro as
its lawful currency in accordance with legislation of the European Union
relating to European Monetary Union;

 

(f)            “Parties” means any party to the Agreement,
including its successors in title permitted assigns and permitted transferees;

 

(g)           “Tariff Base” has the meaning given to it
in, and will be calculated in accordance with, the Fees Rules; and

 

(h)           “Unpaid Sum” means any sum due and payable
but unpaid by a Security Party under the Security Documents.

 

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 (pound)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 Facility 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 percentages of each Bank for the
purpose of A and C above and 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 Facility Office in
the same jurisdiction as its Facility 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.

 

115

 

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.

 

12.           The Agent may from time to time, after
consultation with the Borrower and the Banks, determine and notify to all
Parties 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.

 

116<Page>

                                                                   Exhibit 10.12

                                 LEASE AGREEMENT

     This Lease Agreement (the "Lease") is made and entered into as of the _____
day of November, 1999, by and between TEAS II, LLC ("Landlord") and LONGVIEW
ROADHOUSE, LLC ("Tenant").

            Landlord and Tenant previously entered into a Lease Agreement dated
July 14, 1999 (the "Prior Lease"). Landlord and Tenant hereby wish to terminate
the Prior Lease and enter into this Lease upon the terms and conditions set
forth herein.

                                    ARTICLE I

                                 GRANT OF LEASE

     1.1    GRANT OF LEASE. Landlord hereby demises and leases to Tenant, and
Tenant hereby leases and accepts from Landlord, those certain "Premises"
described on EXHIBIT "A" attached hereto, located in Longview, Texas.

                                   ARTICLE II

                                      TERM

     2.1    TERM. The initial term (the "Initial Term") of this Lease shall
commence as of the date hereof (the "Commencement Date") and shall end fifteen
years from the date hereof (the "Termination Date"). Upon written notice to
Landlord given at least ninety (90) days prior to the Termination Date, and
subject to the provisions of Article III, Tenant shall have the right to renew
this Lease on at least as favorable terms as contained herein for an additional
five (5) year term (the "First Renewal Term"). Upon written notice to the
Landlord given at least ninety (90) days prior to the termination of the First
Renewal Term, and subject to the provisions of Article III, Tenant shall have
the right to renew this Lease on at least as favorable terms as contained herein
for a second additional term of five (5) years (the "Second Renewal Term").

     2.2    ACCEPTANCE OF PREMISES. Tenant hereby accepts the Premises for
occupancy in its current "as is" condition and acknowledged that the Premises
are satisfactory and in conformity with the provisions of this Lease.

     2.3    TIME OF RENTAL PAYMENTS. The first rentals due under this Lease
shall be payable in advance for any partial calendar month of occupancy on a
prorated basis and thereafter on the first day of each calendar month in
advance. Rental for a final partial calendar month of the Lease shall also be
prorated.

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                                   ARTICLE III

                                RENT AND REBATES

     3.1    BASE RENT. Tenant shall pay to Landlord, as minimum guaranteed
rental (the "Base Rent") during the Initial Term the following amounts:

            (a)   YEARS ONE (1) THROUGH FIVE (5). Commencing on the first (1st)
day of the commencement of the Initial Term of this Lease, the annual Base Rent
shall be an amount equal to 110% of the total first month's payment (the
"Initial Loan Payment") for all loans obtained by Landlord for the purpose of
the purchase of real estate and construction of the Premises (the "Loans"). For
the purposes of determining the Base Rent, the amount of the Initial Loan
Payment shall be determined by assuming level monthly payments over a twenty
year period.

            (b)   YEARS SIX (6) THROUGH TEN (10). Base Rent shall be increased
by 5% at the beginning of the sixth year of the Initial Term.

            (c)   YEARS ELEVEN (11) THROUGH FIFTEEN (15). Commencing at the
beginning of the eleventh year of the Initial Term, and continuing through the
last day of the Initial Term hereof, the annual Base Rent shall be an amount
equal to the annual Base Rent during first year of the Initial Term, increased
by an amount equal to the increase in the cost of living from three (3) months
prior to the Commencement Date of this Lease until three (3) months prior to the
end of tenth year of the Initial Term hereof, as reflected in the Consumer Price
Index For All Items and Major Group Figures For All Urban Consumers published by
the Bureau of Labor Statistics, US Department of Labor ("Index"), payable by
Tenant to Landlord in equal monthly installments. Notwithstanding the foregoing,
the maximum increase in the rent between the Commencement Date and the eleventh
year of the Initial Term shall not exceed 20%.

            (d)   YEARS SIXTEEN (16) THROUGH TWENTY (20). Commencing on the
first (1st) day of the First Renewal Term hereof and continuing through the last
day of the First Renewal Term hereof, the annual Base Rent shall be an amount
equal to the annual Base Rent during the last year of the Initial Term,
increased by an amount equal to the increase in the cost of living from three
(3) months prior to the beginning of the eleventh year of the Initial Term until
three (3) months prior to the end of the Initial Term, as reflected in the
Index, payable by Tenant to Landlord in equal monthly installments.
Notwithstanding the foregoing, the maximum increase in the rent between the
eleventh year of the Initial Term and the first year of the First Renewal Term
shall not exceed 10%.

            (e)   YEARS TWENTY-ONE (21) THROUGH TWENTY-FIVE (25). Commencing on
the first (1st) day of the Second Renewal Term hereof and continuing through the
last day of the Second Renewal Term hereof, the annual Base Rent shall be an
amount equal to the annual Base Rent during the First Renewal Term, increased by
an amount equal to the increase in the cost of living from three (3) months
prior to the date of commencement of the First Renewal Term until three (3)
months prior to the end of the First Renewal Term, as reflected in the Index,
payable by Tenant to Landlord in equal monthly installments. Notwithstanding the
foregoing, the maximum

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increase in the rent between the beginning of the First Renewal Term and the
beginning of the Second Renewal Term shall not exceed 10%.

            (f)   SUCCESSOR INDEX. If there is no Consumer Price Index for All
Items and Major Group Figures For All Urban Consumers published by the Bureau of
Labor Statistics, US Department of Labor, at the times referred to above, then
the most-nearly comparable successor, or if no successor exists, then the most
reasonably comparable other index then being published, shall constitute, and be
used as, the "Index" for purposes of this Lease.

     3.2    ADDITIONAL RENT. During the Initial Term and any additional Renewal
Terms of this Lease, Tenant shall also pay to Landlord Additional Rent as
provided in Article VI. Additional Rent shall be payable as provided in Article
6.1(b).

     3.3    PARTIAL MONTH. If Tenant occupies the Premises for less than an
entire month, Base Rent shall be prorated by multiplying the Base Rent amount by
the percentage determined by dividing the number of days of the month Tenant is
in possession of the Premises by the total number of days in the calendar month.

     3.4    REBATES. Unless and until Tenant is acquired by a Texas Roadhouse
entity that is going public or a Texas Roadhouse entity with shares publicly
traded, at which such time payments made by Landlord to Tenant pursuant to this
Section 3.4 shall cease, Landlord shall pay to Tenant as a rebate (the "Rebate")
40% of the amount by which the Base Rent (less expenses incurred by Landlord in
connection with management of the Premises) exceeds the actual aggregate monthly
payments due under the Loans (the "Actual Loan Payments") for each month. Such
Rebates shall be paid by Landlord to Tenant in monthly installments due on the
15th calendar day of each month. For the purposes of this Section 3.4, if
Landlord enters into any refinancing arrangement, the Actual Loan Payments shall
not include any amount borrowed in excess of the outstanding principal balance
of the Loans prior to refinancing.

                                   ARTICLE IV

                           INSURANCE; INDEMNIFICATION

     4.1    FIRE AND HAZARD INSURANCE. Tenant, at Tenant's expense, shall obtain
and keep in force at all times during the Term of this Lease, or any Renewal
Terms, one or more policies of insurance covering loss or damage to the Premises
in the amount of the full replacement value thereof. Such policies shall provide
protection against all perils included within the classifications of fire,
extended coverage, vandalism, malicious mischief and special extended perils
(all risks) and shall name Landlord as an additional insured. To the extent
reasonably possible, Tenant shall increase such insurance from time to time
during the Term, or any Renewal Terms, to include such additional risks or
greater coverage of the risks set forth above as may be reasonably required by
Landlord's lenders.

     4.2    LIABILITY INSURANCE. Tenant, at Tenant's expense, shall obtain and
keep in force at all times during the Term of this Lease, or any Renewal Terms,
one or more insurance policies of

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comprehensive public liability insurance insuring Landlord and Tenant against
all liability arising out of the ownership, use, occupancy, or maintenance of
the Premises, with policy limits of not less than $5,000,000.00 with respect to
injuries to, or death of, any persons on the Premises, or occurrences of any
property damage to third parties caused on the Premises, whether or not caused
by any of Tenant's employees, agents, representatives, guests or invitees.

     4.3    OTHER INSURANCE. Tenant shall be responsible for obtaining, at
Tenant's expense, any business interruption insurance and insurance on the
equipment, inventory, merchandise, supplies and other property of Tenant on or
about the Premises as Tenant may deem advisable and, in all events, shall
include, without limitation, specific endorsements for full reimbursement of
Rent in the event of any such business interruption. Tenant, on its behalf and
on its insurers' behalf, hereby expressly waives any and all claims against
Landlord for loss or damage to Tenant's equipment, inventory, merchandise,
supplies and other property on or about the Premises due to fire, explosion,
windstorm, or any other casualty, or due to any other cause whatsoever,
regardless whether Tenant has procured insurance thereon and regardless of the
cause of such loss or damage, except as expressly provided in Section 7.2 below.

     4.4    CERTIFICATES OF INSURANCE. Tenant shall deliver to Landlord copies
of the insurance policies required under Sections 4.1 and 4.2 hereof or
certificates evidencing the existence and amounts of such insurance with loss
payable clauses reasonably satisfactory to Landlord. No such policy shall be
cancelable or subject to reduction of coverage or other modification except
after 10 days' prior written notice to Landlord. Tenant shall, within 10 days
prior to the expiration of any policy, furnish Landlord with renewals or
"binders" thereof, or Landlord may order such insurance and charge the cost
thereof to Tenant, which amount shall be payable by Tenant to Landlord upon
demand of Landlord or the applicable insurance company.

     4.5    WAIVER OF SUBROGATION. Landlord and Tenant each hereby waives any
and all rights of recovery against the other, or against the partners, officers,
managers, members, directors, employees, agents and representatives of the
other, for loss or damage to such waiving party or its property or the property
of others under its control, to the extent such damage or destruction is insured
against under any insurance policies in force at the time of such loss or
damage. The provisions of this Section 4.5 shall be effective during the Term
for so long as such provisions do not prohibit securing insurance coverage from
responsible insurance companies by either party after a good faith effort.
Landlord and Tenant shall give notice to applicable insurance carrier(s) that
the foregoing mutual waiver of subrogation is contained in this Lease and
attempt in good faith to cause its insurance policies with respect to the
Premises, and the property contained therein, to be endorsed to permit the
foregoing waiver of subrogation.

     4.6    INDEMNIFICATION. Tenant shall indemnify Landlord and save and hold
Landlord harmless from and against any and all claims, actions, damages,
liabilities, and expenses in connection with loss of life, personal injury
and/or damage to property arising from, out of, or in connection with the
occupancy or use by Tenant of the Premises or any part thereof; PROVIDED,
HOWEVER, that this indemnification by Tenant shall not extend to acts of
negligence of Landlord, or Landlord's officers, managers, members, directors,
partners, employees, agents, or

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<Page>

representatives, or to events or accidents which occur as a result of Landlord's
failure to perform its obligations under this Lease. In the event Landlord
shall, without any fault on its part, be made a party to any litigation
commenced by or against Tenant, or against Landlord as a result of any action or
inaction by Tenant in connection with the Premises, then Tenant shall protect
and hold Landlord harmless and shall pay all costs, expenses, and reasonable
attorneys fees incurred or paid by Landlord in connection with such litigation.

                                    ARTICLE V

                 UTILITIES; MAINTENANCE, ALTERATIONS AND REPAIRS

     5.1    UTILITIES. Tenant shall timely pay for all heat, water, sewer
service, gas, electricity, telephone and other utilities and services used in or
about the Premises, and all such utilities and services, as applicable, shall be
metered to the Premises in Tenant's name.

     5.2    MAINTENANCE AND REPAIRS.

            (a)   TENANT'S GENERAL OBLIGATION TO MAINTAIN. Except as set forth
in Article XIV, Tenant, at Tenant's expense, shall maintain the Premises and all
additions thereto and improvements thereof in good repair and condition
throughout the Term and shall yield up the Premises upon the expiration or
sooner termination of this Lease in broom clean condition and in as good and
tenantable condition as the Premises were in at the beginning of the Term or at
the time later added to the Premises, as the case may be, normal wear and tear
excepted.

            (b)   SPECIFIC MAINTENANCE OBLIGATIONS OF TENANT. In furtherance of,
and not by way of limitation of, Tenant's obligations under Section 5.2(a)
hereof, Tenant, at Tenant's expense, shall be responsible for all repairs,
replacements and maintenance required with respect to the Premises, including,
but not limited to, the repair and/or replacement of (i) any burst, stopped or
leaking water, gas, sewer or other pipes or plumbing fixtures or equipment,
(ii) any dysfunctional or malfunctioning lighting, electrical, or heating,
ventilation and air conditioning components, circuits, facilities or systems,
(iii) any fences, parking areas, sidewalks, driveways, landscaping and signs,
(iv) any sprinklers or other fire or smoke alarm or control devices and (v) any
foundations, structural components, exterior or interior walls and surfaces,
roofs, gutters, downspouts, ceilings, windows and doors.

            (c)   WAIVER OF LANDLORD LIABILITY. Landlord shall not be
responsible or liable to Tenant for any loss or damage resulting from any cause
whatsoever, including, but not limited to, any loss or damage from any burst,
stopped or leaking water, gas, sewer or other pipes or plumbing fixtures or
equipment, or from any failure of or defect in any lighting, electrical, or
heating, ventilation and air conditioning components, circuits, facilities or
systems.

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     5.3    ALTERATIONS BY TENANT.

            (a)   NONSTRUCTURAL INTERIOR ALTERATIONS. Without obtaining
Landlord's consent, Tenant, at Tenant's expense, may during the Term of this
Lease, or any Renewal Term, make any interior alterations, additions, or
improvements to the Premises that do not affect the structural components of any
building or other improvement. Any such interior alteration, addition, or
improvement shall be made in a first class workmanship manner, and in accordance
with all valid requirements of municipal or other governmental authorities.

            (b)   STRUCTURAL ALTERATIONS. Tenant shall not make any structural
additions or other alterations to, nor remove or demolish, any building or other
improvement constituting a part of the Premises without the prior written
consent of Landlord, which shall not be unreasonably withheld.

            (c)   ALTERATIONS BECOME PART OF PREMISES. Tenant agrees that any
improvements or alterations to the Premises shall immediately become the
property of the Landlord and shall remain upon the Premises.

     5.4    MECHANICS OR MATERIALMEN'S LIENS. Tenant shall not allow any
mechanic's, materialman's, or other liens to be filed against any part or all of
the Premises as a result of any act or omission by Tenant, provided however,
Tenant may contest, by appropriate proceedings, the amount, validity or
application of any mechanic's, materialman's, or other lien filed against any
part or all of the Premises so long as (i) no part of the Premises would be
subject to loss, sale or forfeiture before determination of such contest, (ii)
Landlord is not subject to any criminal penalty as a result of the failure to
pay such lien, and (iii) Tenant conducts all such contests, at Tenant's expense,
with due diligence and in good faith.

     5.5    SIGNS AND OTHER TRADE FIXTURES. Tenant may install on the Premises
any and all racks, counters, tables, shelves, signage, and other trade fixtures
and equipment that might be necessary or desirable to the Tenant's use of the
Premises for permitted purposes (collectively, the "Trade Fixtures"). All such
Trade Fixtures shall be the property of Tenant, and, so long as Tenant is not in
default under this Lease, Tenant shall have the right to remove all or any part
of the Trade Fixtures from the Premises at any time during, or upon the
expiration or sooner termination of, the Term; provided, however, that Tenant
shall repair, or reimburse Landlord for the full costs of repairing, any damage
to the Premises resulting from the installation or removal of such Trade
Fixtures. It is specifically understood and agreed that all trademarks, trade
names, service marks, signs, and other marks of identification used by Tenant in
Tenant's business shall remain the exclusive property of Tenant, and Landlord
shall have no right, title, or interest in or to any of such trademarks, trade
names, service marks, signs, or other marks of identification.

     5.6    LANDLORD'S RIGHT OF ENTRY. Landlord and Landlord's employees and
agent shall have the right to enter the Premises during reasonable hours and
upon reasonable notice to Tenant (or at any time with or without notice in the
event of any emergency) in order to (i) examine the Premises, or (ii) make such
repairs and alterations as may be necessary for the

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safety and preservation of the improvements on the Premises (the cost of which
repairs and alterations shall be borne by Tenant), but without any obligations
to make any such repairs.

                                   ARTICLE VI

                                      TAXES

     6.1    ADDITIONAL RENT FOR REAL PROPERTY TAXES.

            (a)   TENANT OBLIGATION TO PAY REAL PROPERTY TAXES. As Additional
Rent, Tenant shall pay all Real Property Taxes (as defined below) applicable to
the Premises during the Term, or any Renewal Term, commencing with those due and
payable in calendar year 1999; provided, however, that the Real Property Taxes
for any year that are payable by Tenant shall be subject to a prorata adjustment
based upon the number of days of said year during which the Premises are leased
to Tenant. For all purposes of this Lease, the term "Real Property Taxes" shall
include any form of assessment, licensing, commercial rental tax, levy, penalty,
ad valorem tax, or other tax (other than income, inheritance and estate taxes)
imposed upon Landlord with respect to the Premises, or otherwise against or with
respect to the Premises, by any authority having the direct or indirect power to
tax, including any city, county, state or federal Government, and any school,
agricultural or other improvement district.

            (b)   NOTICE AND PAYMENT. Following receipt by Landlord of the then
current bills for Real Property Taxes due and payable in 1999 or later years
during the Term, or any Renewal Term, Landlord shall forward a copy thereof to
Tenant. Within 30 days after receipt of such notice from Landlord, Tenant shall
pay to Landlord any amount properly stated therein to be due (subject, however,
to the prorata adjustment for any partial year within the Term, or any Renewal
Term, as provided for under Section 6.1(a)).

     6.2    PERSONAL PROPERTY TAXES. Tenant shall pay, prior to delinquency, all
taxes assessed against or with respect to any Trade Fixtures, furnishings,
equipment, or other personal property contained in the Premises. Any such taxes
payable by Landlord shall be treated and included as Real Property Taxes, and
shall be subject to the provisions of Section 6.1.

     6.3    INCOME TAXES. Nothing in this Lease shall be construed as requiring
Tenant to pay (i) any municipal, state or Federal income taxes assessed against
Landlord, (ii) any municipal, state, or Federal capital, levy, estate,
succession, inheritance, or transfer taxes of Landlord, or (iii) any corporate
franchise taxes imposed upon any corporate owner of the Premises.

                                   ARTICLE VII

                          INJURY TO PERSON OR PROPERTY

     7.1    INDEMNITY BY TENANT. Tenant shall indemnify and hold harmless
Landlord for every demand, claim, cause of action, judgment, expense (including
court costs and attorney

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fees), loss or damages resulting from any injury or damage to the person or
property of Landlord where the injury or damage is caused by the negligence or
misconduct of Tenant, its agents, employees or members, or any other person
entering the Premises under express or implied invitation of Tenant, or that
results from Tenant's violation of laws, ordinances or governmental orders of
any kind.

     7.2    INDEMNITY BY LANDLORD. Landlord shall indemnify and hold harmless
Tenant for every demand, claim, cause of action, judgment, expense (including
court costs and attorney fees), loss or damages resulting from any injury or
damage to the person or property of Tenant where the injury or damage is caused
by the negligence or misconduct of Landlord, its agents, employees or members,
or any other person entering the Premises under express or implied invitation of
Landlord, or that results from Landlord's violation of laws, ordinances or
governmental orders of any kind.

                                  ARTICLE VIII

                            ASSIGNMENT AND SUBLETTING

     8.1    ASSIGNMENT. This Lease may be assigned, pledged, mortgaged,
encumbered or transferred by either party to another party.

     8.2    SUBLETTING. Tenant may sublet all or any part of the Premises
without Landlord's consent.

     8.3    TENANT'S OBLIGATION SHALL CONTINUE. Any assignment or subletting
that is permitted under this Article VIII shall in no way release or relieve
Tenant of its obligations under this Lease.

                                   ARTICLE IX

                                    SURRENDER

     9.1    SURRENDER. Upon termination of this Lease, Tenant shall surrender to
Landlord the Premises in substantially the same condition as Tenant was bound to
maintain under this Lease. Upon surrender, all leasehold improvements and
remaining fixtures and improvements made by Tenant shall become the property of
Landlord, other than trade fixtures, which remain the property of Tenant.
Payment by Tenant of any monies due after the termination of this Lease shall
not reinstate or continue the Term and shall not make ineffective any notice
given Tenant prior to the payment and receipt of such monies.

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                                    ARTICLE X

                        DAMAGE BY FIRE OR OTHER CASUALTY

     10.1   DAMAGE TO PREMISES. If all or part of the Premises are rendered
untenable by damage from a fire or other casualty, then Tenant may elect to
terminate this Lease as of the date of such casualty by written notice to
Landlord within thirty (30) days following the casualty. During any period in
which the leased Premises are wholly or substantially rendered untenable by
reason of fire or other casualty, the lease payments will be abated.

     10.2   ABATEMENT OF RENT. If Tenant does not elect to terminate this Lease,
then during such time as repairs are being made, the rent shall be
proportionately abated for that portion of the Premises that are unusable by
Tenant. Such abatement shall commence on the first day of the casualty and
extend until five (5) days following the completion of repairs.

                                   ARTICLE XI

                              TRANSFERS BY LANDLORD

     11.1   SALES, CONVEYANCE AND ASSIGNMENT. Nothing in this Lease shall
restrict the right of Landlord to assign this Lease or sell, transfer or convey
its interest in the Building and the Premises are a part, or any part thereof.

                                   ARTICLE XII

                           NOTICES AND ACKNOWLEDGMENTS

     12.1   NOTICES. Any notice from one (1) party to the other hereunder shall
be in writing and shall be deemed to have been duly served if delivered below,
or to such other address as may be designated by either Landlord or Tenant by
notice given in accordance with this Section 12.1:

     To Landlord:                        TEAS II, LLC
                                         36 Remington West
                                         Highland Village, Texas 75067
                                         Attention: Steven L. Ortiz

     To Tenant:                          Longview Roadhouse, LLC
                                         320 East Loop 281
                                         Longview, Texas 75605
                                         Attention: Manager

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A request, notice, approval, consent or communication given in accordance with
this Section 12.1 shall be deemed received (i) upon delivering it in person,
(ii) three days after depositing it in an office of the United States Postal
Service, or (iii) one day after giving it to a nationally recognized overnight
carrier.

                                  ARTICLE XIII

                                     DEFAULT

     13.1   CONDITIONS OF DEFAULT BY TENANT. The occurrence of one or more of
the following events (hereinafter referred to as "default") shall be deemed a
default under this Lease by Tenant:

            (a)   Tenant does not timely pay the Rent or any other amounts
payable hereunder; and such failure to pay continues for seven (7) calendar days
following receipt of written notice from Landlord; or

            (b)   Tenant neglects or fails to perform any of the other covenants
and provisions contained in this Lease and Tenant fails to remedy the same or to
begin to remedy the same within fifteen (15) calendar days following receipt of
written notice from Landlord, unless a longer correction period is granted by
Landlord in the written notice, provided that Tenant proceeds with due diligence
to complete such cure and informs Landlord of actions taken to initiate such
cure within the specified time period; or

            (c)   Tenant (1) is adjudicated bankrupt or insolvent, (2) files a
petition for bankruptcy or for reorganization under the Bankruptcy Act as now or
in the future may be amended, or (3) assigns its properties for the benefit of
creditors, except as is normally required in debt financing instruments; or

In the event of a default by Tenant under this Section 13.1, Tenant shall remain
directly and primarily liable for all payments to be made pursuant to Articles
III, IV, V and VI of this Agreement for the remaining term of the Lease.

     13.2   LANDLORD RIGHTS. If one (1) or more of such events in Article 13.1
occur, Landlord shall have the right, at its option and without limiting itself
in the exercise of any other right or remedy it may have on account of such
breach or default, and without any further demand or notice, reenter the
Premises with process of law, take possession of the Premises, improvements,
additions, alterations, equipment and fixtures thereon, and eject all parties in
possession as may be necessary. In such event, Landlord may, without terminating
this Lease, at any time, relet the demised Premises or any part thereof for the
account of Tenant, and receive and collect the rent therefor. In any case, and
whether or not the demised Premises or any part thereof is relet, Tenant shall
pay to Landlord all sums required to be paid by Tenant up to the time of reentry
by Landlord, and pay to Landlord until the end of the term of this Lease the
equivalent of the amount of all rent, less the proceeds of such reletting, if
any.

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     13.3   CONDITIONS OF DEFAULT BY LANDLORD. Landlord shall be considered to
be in default under this Lease should Landlord neglect or fail to perform any of
its covenants and provisions herein contained and Landlord fails to remedy the
same or to begin to remedy the same within fifteen (15) calendar days following
receipt of written notice by Tenant unless a longer correction period is granted
by Tenant in the written notice, provided that Landlord proceeds with due
diligence to complete such cure and informs Tenant of actions taken to initiate
such cure within the specified time period.

     13.4   TENANT'S RIGHTS. If an event as described in Article 13.3 occurs,
Tenant shall have the right, at its option and without limiting itself in the
exercise of any other right or remedy it may have on account of such breach or
default, and without any further demand or notice, to terminate this Lease,
without any further obligation to Landlord.

                                   ARTICLE XIV

                                 EMINENT DOMAIN

     14.1   If the whole or substantially all of the Premises, or all or
substantially all of the means of access thereto, is acquired by eminent domain
or by purchase in lieu thereof, so that the Premises cannot be operated for its
intended use, this Lease shall terminate as of the date of the taking. In the
event only a portion of the Premises are so taken or condemned, so as not to
materially and adversely effect Tenant's use of the Premises, this Lease shall
continue in full force; PROVIDED, HOWEVER, that the Rent payable under the
unexpired Term of this Lease shall be adjusted to such extent as may be fair and
reasonable under the circumstances. Landlord shall, in such event, promptly
restore the Premises as nearly as feasible to the condition of the Premises
immediately prior to the taking, subject to reasonable delays, but Landlord
shall not be required to restore or rebuild the Premises during the last two (2)
years of the Term of this Lease; PROVIDED, FURTHER, that if Landlord elects not
to restore or rebuild the Premises, Tenant shall have the option to terminate
this Lease upon written notice delivered to Landlord. In the event of a total or
partial taking of the Premises, Landlord and Tenant shall have such rights to
the condemnation awards as are provided for under the laws governing such
taking, and shall be entitled to such portion of the proceeds, if any, as are
provided for by such laws.

                                   ARTICLE XV

                                  MISCELLANEOUS

     15.1   APPLICABLE LAW AND CONSTRUCTION OF LEASE. This Lease shall be
governed by and under the laws of the State of Texas, and its provisions shall
be constructed or modified in part or in whole in accordance with the applicable
law's common meaning and not strictly interpreted for or against either Landlord
or Tenant. Any change in applicable law shall require only provisions of the
Lease so affected to be modified and shall not invalidate or nullify any of the
other provisions contained herein. The captions and arrangements of the
paragraphs are for convenience only and have no effect on the interpretation of
the Lease.

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     15.2   SUCCESSORS BOUND. Except as otherwise provided, the covenants, terms
and conditions in this Lease shall apply to and bind the permitted successors
and assigns of the parties hereto.

     15.3   AMENDMENT OR MODIFICATION. Unless otherwise specifically provided in
this Lease, no amendment, modification, addition by supplement or exhibit shall
be valid unless set out in writing and executed by the parties hereto in the
same manner as the execution of this Lease. This Lease, in its entirety, may be
changed, amended or otherwise modified by mutual consent of the parties hereto.

     15.4   NO IMPLIED SURRENDER OR WAIVER. No provisions of this Lease shall,
even if not enforced or exercised from time to time, be deemed to have been
waived by Landlord or Tenant unless a waiver is in writing signed by Landlord or
Tenant.

     15.5   ENTIRE AGREEMENT. This Lease, as may be amended from time to time as
described herein, contains the entire agreement between the parties with respect
to the subject matter of this Lease. This Lease is effective and binding upon
the parties and supersedes any other lease that may exist between them.

                            [signature page follows]

                                       12
<Page>

     IN WITNESS WHEREOF, the parties have executed this Lease Agreement,
effective as of the date first written above, and by the signatures signed
below.

LANDLORD:                                TENANT:

TEAS II, LLC                             LONGVIEW ROADHOUSE, LLC

By:/s/ Steven L. Ortiz                   By:   /s/ Steven L. Ortiz
   --------------------------                  ----------------------------
   Steven L. Ortiz, its Manager                Steven L. Ortiz, its Manager

<Page>

                                    EXHIBIT A

All that certain lot, tract or parcel of land being 1.677 acre of land located
in the P.P. Rains Survey, A-258, City of Longview, Gregg County, Texas. Said
1.677 acre of land being a part of a 5.165 acre tract conveyed to T. John Ward,
Kenneth Ross and Earl Sharp by deed recorded in Volume 1325, Page 266, Deed
Records of said county, said 1.677 acre tract being a part of a 5.165 acre tract
conveyed to John Earl Sharp and James William Sharp, described by deed recorded
in Volume 1522, Page 230 of said Deed Records, and also being a part of a 5.165
acre tract conveyed to Jerry Meyer by deed recorded in Volume 1964, Page 155,
Public Official Records of said county, said 1.677 acre tract being more
particularly described as follows:

BEGINNING at a 3/8" iron rod found on the north boundary line of said 5.165 acre
tract and the south right of way line of State Highway Loop 281, said rod being
the northwest corner of a 0.550 acre tract, conveyed to Edward Hobbs by deed
recorded in Volume 1634, Page 377, of said Public Official Records, said rod
being N 80 deg. 04'00E, 253.46 feet along the west boundary line of said 0.550
acre tract to a 3/8" iron rod found for the southwest corner of same, said rod
being on the south boundary line of said 5.165 acre tract and the north boundary
line of a tract of land conveyed to Joe D. Pierece described by deed recorded in
Volume 1508, Page 463 of said Deed Records;

THENCE S 84 deg. 35'20"W, 189.65 feet along the south boundary line of said acre
tract and successively with the north boundary lines of said Pierce tract, a
0.41 acre tract conveyed to Darhal Manning described by deed recorded in Volume
1556, Page 89, said Deed records, and the north boundary line of a 0.38 acre
tract conveyed to J.B. Hunter described by deed recorded in Volume 812, Page 369
of said Deed Records to a 1/2" iron rod found, said rod being the northeast
corner of a 3.78 acre tract conveyed to Bessie L. Brown described by deed
recorded in Volume 1332, Page 63 of said Deed Records;

THENCE S 89 deg. 06'55W, 73.50 feet along the south boundary line of said 5.165
acre tract and the north boundary line of said 3.78 acre tract to a 1/2" iron
rod set, said rod being N 89 deg. 06'55"E, 314.02 feet from a 3/8" iron found
for the southeast corner of the Austin Bank 1.28 acre tract according to the
deed of records in Volume 2718, Page 453, Public Official Records of said
County;

THENCE N 01 deg. 36'56"W, 296.92 feet across said 5.165 acre tract to a 1/2"
iron rod set on the south right of way line of said highway and being on the
north boundary line of said 5.165 acre tract, said rod being S 85 deg. 37'01"E,
315.72 feet from a 1/2" iron rod found for the northeast corner of said Austin
State Bank tract;

THENCE S 85 deg. 37'01"E, 214.07 feet along the north boundary line of said
5.165 acre tract and the south right of way line of said highway to a broken
highway monument found, said monument being 135 feet right of Engineer's
Centerline Station 241+00;

<Page>

THENCE S 80 deg. 24'20"E, 48.77 feet along the north boundary line of said 5.165
acre tract and the south right of way line of said highway to the POINT OF
BEGINNING and containing 1.677 acre of land, more or less.

<Page>

                                    EXHIBIT B

<Page>

                                   LEASE RIDER

     This Lease Rider is made and entered into this _____ day of November, 1999
by and between Texas Roadhouse Development Corporation, a Kentucky corporation
("Franchisor"). Longview Roadhouse, LLC ("Franchisee") and ______ ("Landlord").

     WHEREAS, Franchisor and Franchisee are parties to that certain Franchise
Agreement dated November ___, 1999 ("Franchise Agreement");

     WHEREAS, Franchisee and Landlord desire to enter into a lease (the "Lease")
pursuant to which Franchisee will occupy the premises located at 320 East Loop
281, Longview, Texas 75605 (the "Premises") for a full-service Texas Roadhouse
restaurant (the "Restaurant") licensed under the Franchise Agreement; and

     WHEREAS, as a condition to entering into the Lease, the Franchisee is
required under the Franchise Agreement to execute this Lease Rider along with
the Landlord and Franchisor;

     NOW, THEREFORE, in consideration of the mutual undertakings and commitments
set forth herein and in the Franchise Agreement, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as follows:

          (1) During the term of the Franchise Agreement, the Premises shall be
used only for the operation of the Restaurant.

          (2) Landlord consents to Franchisee's use of such marks and signs,
decor items, color schemes and related components of the Texas Roadhouse
restaurant system as Franchisor may prescribe for the Restaurant.

          (3) Landlord agrees to furnish Franchisor with copies of any and all
letters and notices sent to Franchisee pertaining to the Lease and the Premises,
at the same time that such letters and notices are sent to Franchisee.

          (4) Franchisor shall have the right to enter the Premises to make any
modification or alteration necessary to protect the Texas Roadhouse restaurant
system and marks. Franchisor shall also have the right, but not the obligation
to cure any default under the Franchise Agreement or any development agreement
entered into between Franchisor and Franchisee or under the Lease, without being
guilty of trespass or any other crime or tort.

          (5) Franchisee shall be permitted to assign the Lease to Franchisor or
its affiliates upon the expiration or earlier termination of the Franchise
Agreement or upon Franchisor's purchase of Franchisee's assets under Section
XIV. of the Franchise Agreement, and the Landlord hereby consents to (and agrees
to provide written consent to) such assignment and agrees not to impose or
assess any assignment fee or similar charge or accelerate or increase rent under
the Lease in connection with such assignment.

          (6) In the event of such assignment, Franchisor or any affiliate
designated by Franchisor will agree to assume from the date of assignment all
obligations of Franchisee remaining under the Lease, and in such event
Franchisor or any affiliate shall assume Franchisee's occupancy rights, and the
right to sublease the Premises, for the remainder of the term of the Lease.

          (7) Franchisee shall not assign the Lease or renew or extend the term
thereof without the prior written consent of Franchisor.

          (8) Landlord and Franchisee shall not amend or otherwise modify the
Lease in any manner that could materially affect any of the foregoing
requirements without the prior written consent of Franchisor.

<Page>

          (9) The terms of this Lease Rider will supersede my conflicting terms
of the Lease.

     IN WITNESS WHEREOF, the parties have executed this Lease Rider as of the
date first above written.

                                 FRANCHISOR:

                                 Texas Roadhouse Development Corporation,
                                 a Kentucky corporation

                                 By:   /s/ William Brea
                                       -----------------------------------
                                       William Brea Jr, Chief Financial Officer

                                 FRANCHISEE:

                                 Longview Roadhouse, LLC

                                 By: TEAS, Inc.

                                       By:   /s/ Steve L. Ortiz
                                             ---------------------------
/s/ Monica Schmidt                           Steve Ortiz
------------------                           President
Witness

                                 LANDLORD:

                                   TEAS II INC.

                                 By:   /s/ Steven L. Ortiz
                                       ---------------------------------
                                       Name:   Steven L. Ortiz
                                               -------------------------
                                       Title:  President
                                               -------------------------

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