Document:

EX-10.4

 Exhibit 10.4 

FORM OF INVESTMENT MANAGEMENT TRUST AGREEMENT 

This Investment Management Trust Agreement (this “Agreement”) is made effective as of
                , 2016, by and between Hunter Maritime Acquisition Corp., a Marshall Islands corporation (the “Company”), and Continental Stock
Transfer & Trust Company, a New York corporation (the “Trustee”). 
 WHEREAS, the Company’s
registration statement on Form F-1 (Registration Statement No. 333-214058) (the “Registration Statement”) and prospectus (the “Prospectus”) for the initial public offering of the Company’s units
(the “Units”), each of which consists of one share of the Company’s Class A common shares, par value $0.0001 per share (the “Common Shares”), and one-half warrant, each whole warrant
entitling the holder thereof to purchase one Common Share (such initial public offering hereinafter referred to as the “Offering”), has been declared effective as of the date hereof by the U.S. Securities and Exchange
Commission; 
 WHEREAS, the Company has entered into an Underwriting Agreement (the “Underwriting Agreement”)
with Morgan Stanley & Co. LLC, as representative (the “Representative”) of the several underwriters (the “Underwriters”) named therein; 

WHEREAS, as described in the Registration Statement, $150,000,000 of the gross proceeds of the Offering and sale of the Private
Placement Warrants (as defined in the Underwriting Agreement) (or $172,500,000 if the Underwriters’ over-allotment option is exercised in full) will be delivered to the Trustee to be deposited and held in one or more segregated trust accounts
located in Belgium (or such other jurisdiction as determined in good faith by the Trustee and the Company) (the “Trust Accounts”) for the benefit of the Company and the holders of the Common Shares included in the Units
issued in the Offering as hereinafter provided (the amount to be delivered to the Trustee (and any investment earnings subsequently earned thereon) is referred to herein as the “Property,” the shareholders for whose
benefit the Trustee shall hold the Property will be referred to as the “Public Shareholders,” and the Public Shareholders and the Company will be referred to together as the “Beneficiaries”);

 WHEREAS, pursuant to the Underwriting Agreement, a portion of the Property equal to $5,250,000, or $6,037,500 if the
Underwriters’ over-allotment option is exercised in full, is attributable to deferred underwriting discounts and commissions that may be payable by the Company to the Underwriters upon the consummation of the Business Combination (as defined
below) (the “Deferred Discount”); and 
 WHEREAS, the Company and the Trustee desire to enter into this
Agreement to set forth the terms and conditions pursuant to which the Trustee shall hold the Property. 

  
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 NOW THEREFORE, IT IS AGREED: 

1. Agreements and Covenants of Trustee. The Trustee hereby agrees and covenants to: 

(a) Hold the Property in trust for the Beneficiaries in accordance with the terms of this Agreement in the Trust Accounts established by the
Trustee at a branch office of KBC Bank located in Belgium or at another bank or brokerage institution that is reasonably satisfactory to the Company and the Trustee; 

(b) Manage, supervise and administer the Trust Accounts subject to the terms and conditions set forth herein; 

(c) In a timely manner, upon the written instruction of the Company, invest and reinvest the Property in United States “government
securities” within the meaning of Section 2(a)(16) of the Investment Company Act of 1940, as amended, having a maturity of 180 days or less, or in money market funds meeting the conditions of paragraphs (d)(1), (d)(2), (d)(3) and
(d)(4) of Rule 2a-7 promulgated under the Investment Company Act of 1940, as amended, which invest only in direct U.S. government treasury obligations, as determined by the Company; it being understood that the Trust Accounts will earn no
interest while the Property is uninvested awaiting the Company’s instructions hereunder; 
 (d) Collect and receive, when due, all
interest or other income arising from the Property, which shall become part of the “Property,” as such term is used herein; 
 (e)
Promptly notify the Company and the Representative of all communications received by the Trustee with respect to any Property requiring action by the Company; 

(f) Supply any necessary information or documents as may be requested by the Company (or its authorized agents) in connection with the
Company’s preparation of the tax returns relating to the Property held in the Trust Accounts; 
 (g) Participate in any plan or
proceeding for protecting or enforcing any right or interest arising from the Property if, as and when instructed by the Company in writing to do so; 

(h) Render to the Company, and to such other person as the Company may instruct, monthly written statements of the activities of, and amounts
in, the Trust Accounts reflecting all activity of the Trust Accounts, including without limitation all receipts and disbursements; 
 (i)
Promptly commence liquidation of the Trust Accounts only after (x) receipt of, and only in accordance with, the terms of a letter from the Company (“Termination Letter”) in a form substantially similar to that attached
hereto as either Exhibit A or Exhibit B signed on behalf of the Company by its Chief Executive Officer, Chief Financial Officer, or Secretary, or another authorized officer of the Company, and complete the liquidation of the Trust
Accounts, including the distribution of the Property in the Trust Accounts, including all investment earnings (which shall be net of (i) any taxes payable, (ii) working capital released to the Company and (iii) up to $100,000 of investment earnings
that may be released to the 

  
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Company to pay dissolution expenses, it being understood that the Trustee has no obligation to monitor or question the Company’s allocation of a portion of the investment earnings pursuant
to (i), (ii) or (iii) above, only as directed in the Termination Letter and the other documents referred to therein, or (y) upon the date which is 24 months after the closing of the Offering, if a Termination Letter has not been received by the
Trustee prior to such date, in which case the Trust Accounts shall be liquidated in accordance with the procedures set forth in the Termination Letter attached as Exhibit B and the Property in the Trust Accounts, including investment earnings
(which investment income shall be net of any taxes payable and working capital released to the Company and less up to $100,000 of investment earnings that may be released to the Company to pay dissolution expenses), shall be distributed to the
Public Shareholders of record as of such date; provided, however, that in the event the Trustee receives a Termination Letter in a form substantially similar to Exhibit B hereto, or if the Trustee begins to liquidate the Property because it
has received no such Termination Letter by the date which is 24 months after the closing of the Offering, the Trustee shall keep the Trust Accounts open until 12 months following the date the Property has been distributed to the Public Shareholders;

 (j) Upon written request from the Company, which may be given from time to time in a form substantially similar to that attached hereto as
Exhibit C, withdraw from the Trust Accounts and distribute to the Company the amount of investment earnings earned on the Property requested by the Company to cover (i) any tax obligation arising in connection with the Property, or (ii) for
working capital purposes, which amount, in each case, shall be delivered directly to the Company by electronic funds transfer or other method of prompt payment, and the Company shall forward such payment to the relevant taxing authority;
provided, however, that to the extent there is not sufficient cash in the Trust Accounts to pay such tax obligation, the Trustee shall liquidate such assets held in the Trust Accounts as shall be designated by the Company in writing to
make such distribution so long as there is no reduction in the principal amount initially deposited in the Trust Account; provided further, however, that if the tax to be paid is a franchise tax, the written request by the Company to make
such distribution shall be accompanied by a copy of the franchise tax bill for the Company and a written statement from the Chief Financial Officer of the Company setting forth the actual amount payable (it being acknowledged and agreed that any
such amount in excess of investment earnings earned on the Property shall not be payable from the Trust Accounts). The written request of the Company referenced above shall constitute presumptive evidence that the Company is entitled to said
funds, and the Trustee shall have no responsibility to look beyond said request; 
 (k) Upon written request from the Company, which may be
given from time to time in a form substantially similar to that attached hereto as Exhibit D, the Trustee shall distribute on behalf of the Company the amount requested by the Company to be used to redeem Common Shares from Public
Shareholders properly submitted in connection with a shareholder vote to approve an amendment to the Company’s Amended and Restated Articles of Incorporation that would affect the substance or timing of the Company’s obligation to redeem
100% of its public Common Shares if the Company has not consummated an initial Business Combination within such time as is described in the Company’s Amended and Restated Articles of Incorporation. The written request of the Company referenced
above shall constitute presumptive evidence that the Company is entitled to distribute said funds, and the Trustee shall have no responsibility to look beyond said request; and 

  
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 (l) Not make any withdrawals or distributions from the Trust Accounts other than pursuant to
Section 1(i), (j) or (k) above. 
 2. Agreements and Covenants of the Company. The Company hereby agrees and covenants
to: 
 (a) Give all instructions to the Trustee hereunder in writing, signed by the Company’s Chief Executive Officer, Chief Financial
Officer, or Secretary. In addition, except with respect to its duties under Sections 1(i), 1(j) and 1(k) hereof, the Trustee shall be entitled to rely on, and shall be protected in relying on, any verbal or telephonic advice or instruction
which it, in good faith and with reasonable care, believes to be given by any one of the persons authorized above to give written instructions, provided that the Company shall promptly confirm such instructions in writing; 

(b) Subject to Section 4 hereof, hold the Trustee harmless and indemnify the Trustee from and against any and all expenses, including
reasonable counsel fees and disbursements, or losses suffered by the Trustee in connection with any action taken by it hereunder and in connection with any action, suit or other proceeding brought against the Trustee involving any claim, or in
connection with any claim or demand, which in any way arises out of or relates to this Agreement, the services of the Trustee hereunder, or the Property or any investment income earned on the Property, except for expenses and losses resulting from
the Trustee’s gross negligence, fraud or willful misconduct. Promptly after the receipt by the Trustee of notice of demand or claim or the commencement of any action, suit or proceeding, pursuant to which the Trustee intends to seek
indemnification under this Section 2(b), it shall notify the Company in writing of such claim (hereinafter referred to as the “Indemnified Claim”). The Trustee shall have the right to conduct
and manage the defense against such Indemnified Claim; provided that the Trustee shall obtain the consent of the Company with respect to the selection of counsel, which consent shall not be unreasonably withheld. The Trustee may not
agree to settle any Indemnified Claim without the prior written consent of the Company, which such consent shall not be unreasonably withheld. The Company may participate in such action with its own counsel; 

(c) Pay the Trustee the fees set forth on Schedule A hereto, including an initial acceptance fee, annual administration fee, and
transaction processing fee which fees shall be subject to modification by the parties from time to time. It is expressly understood that the Property shall not be used to pay such fees unless and until it is distributed to the Company pursuant
to Sections 1(i) through 1(k) hereof. The Company shall pay the Trustee the initial acceptance fee and the first annual administration fee at the consummation of the Offering. The Trustee shall refund to the Company
the monthly fee (on a pro rata basis) with respect to any period after the liquidation of the Trust Account. The Company shall not be responsible for any other fees or charges of the Trustee except as set forth in this
Section 2(c) and as may be provided in Section 2(b) hereof; 
 (d) In connection with any vote of
the Company’s shareholders regarding a merger, capital stock exchange, asset acquisition, debt acquisition, stock purchase, reorganization or similar business combination involving the Company and one or more businesses (a “Business
Combination”), provide to the Trustee an affidavit or certificate of the Chief Executive Officer, Chief Financial Officers or Secretary verifying the vote of the Company’s shareholders regarding such Business Combination; 

  
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 (e) Provide Morgan Stanley & Co. LLC with a copy of any Termination Letter(s) and/or any
other correspondence that is sent to the Trustee with respect to any proposed withdrawal from the Trust Accounts promptly after it issues the same; 

(f) Expressly provide in any Instruction Letter (as defined in Exhibit A) delivered in connection with a Termination Letter in the form
of Exhibit A that the Deferred Discount be paid directly to the account or accounts directed by Morgan Stanley & Co. LLC; 
 (g)
Instruct the Trustee to make only those distributions that are permitted under this Agreement, and refrain from instructing the Trustee to make any distributions that are not permitted under this Agreement; and 

(h) Within five (5) business days after the Underwriters exercise the over-allotment option (or any unexercised portion thereof) or such
over-allotment expires, provide the Trustee with a notice in writing of the total amount of the Deferred Discount, which shall in no event be less than $6,037,500. 

3. Limitations of Liability. The Trustee shall have no responsibility or liability to: 

(a) Imply obligations, perform duties, inquire or otherwise be subject to the provisions of any agreement or document other than this agreement
and that which is expressly set forth herein; 
 (b) Take any action with respect to the Property, other than as directed pursuant to this
Agreement, and the Trustee shall have no liability to any party except for liability arising out of the Trustee’s gross negligence, fraud or willful misconduct; 

(c) Institute any proceeding for the collection of any principal and income arising from, or institute, appear in or defend any proceeding of
any kind with respect to, any of the Property unless and until it shall have received written instructions from the Company given as provided herein to do so and the Company shall have advanced or guaranteed to it funds sufficient to pay any
expenses incident thereto or provided an indemnity reasonably satisfactory to the Trustee; 
 (d) Refund any depreciation in principal of any
Property; 
 (e) Assume that the authority of any person designated by the Company to give instructions hereunder shall not be continuing
unless provided otherwise in such designation, or unless the Company shall have delivered a written revocation of such authority to the Trustee; 

(f) The other parties hereto or to anyone else for any action taken or omitted by it, or any action suffered by it to be taken or omitted, in
good faith and in the Trustee’s best judgment, except for the Trustee’s gross negligence, fraud or willful misconduct. The Trustee may rely conclusively and shall be protected in acting upon any order, notice, demand,

  
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certificate, opinion or advice of counsel (including counsel chosen by the Trustee, which counsel may be the Company’s counsel), statement, instrument, report or other paper or document (not
only as to its due execution and the validity and effectiveness of its provisions, but also as to the truth and acceptability of any information therein contained) which the Trustee believes, in good faith and with reasonable care, to be genuine and
to be signed or presented by the proper person or persons. The Trustee shall not be bound by any notice or demand, or any waiver, modification, termination or rescission of this Agreement or any of the terms hereof, unless evidenced by a
written instrument delivered to the Trustee, signed by the proper party or parties and, if the duties or rights of the Trustee are affected, unless it shall give its prior written consent thereto; 

(g) Verify the accuracy of the information contained in the Registration Statement unless such information has been provided to the Company by
the Trustee in writing for inclusion in the Registration Statement; 
 (h) Provide any assurance that any Business Combination entered into
by the Company or any other action taken by the Company is as contemplated by the Registration Statement; 
 (i) File information returns
with respect to the Trust Accounts with any local, state or federal taxing authority or provide periodic written statements to the Company documenting the taxes payable by the Company, if any, relating to any interest income earned on the Property;

 (j) Prepare, execute and file tax reports, income or other tax returns and pay any taxes with respect to any income generated by, and
activities relating to, the Trust Accounts, regardless of whether such tax is payable by the Trust Accounts or the Company, including, but not limited to, franchise and income tax obligations, except pursuant to Section 1(j) hereof; or

 (k) Verify calculations, qualify or otherwise approve the Company’s written requests for distributions pursuant to Sections
1(i), 1(j) and 1(k) hereof. 
 4. Trust Account Waiver. The Trustee has no right of set-off or any right, title,
interest or claim of any kind (“Claim”) to, or to any monies in, the Trust Account, and hereby irrevocably waives any Claim to, or to any monies in, the Trust Accounts that it may have now or in the future. In the event
the Trustee has any Claim against the Company under this Agreement, including, without limitation, under Section 2(b) or Section 2(c) hereof, the Trustee shall pursue such Claim solely against the Company and its assets outside
the Trust Accounts and not against the Property or any other monies in the Trust Accounts. 
 5. Termination. This Agreement
shall terminate on the earlier of: 
 (a) January 31, 2017, in the event the Offering does not close; 

(b) If the Trustee gives written notice to the Company that it desires to resign under this Agreement, the Company shall use its reasonable
efforts to locate a successor trustee, pending which the Trustee shall continue to act in accordance with this Agreement. At such time that the Company notifies the Trustee that a successor trustee has been appointed and has agreed

  
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to become subject to the terms of this Agreement, the Trustee shall transfer the management of the Trust Accounts to the successor trustee, including but not limited to the transfer of copies of
the reports and statements relating to the Trust Account, whereupon this Agreement shall terminate; provided, however, that in the event that the Company does not locate a successor trustee within ninety (90) days of receipt of the
resignation notice from the Trustee, the Trustee may submit an application to have the Property deposited with any court in the State of New York or with the United States District Court for the Southern District of New York and upon such deposit,
the Trustee shall be immune from any liability whatsoever; or 
 (c) At such time that the Trustee has completed the liquidation of the Trust
Accounts and its obligations in accordance with the provisions of Section 1(i) hereof and distributed the Property in accordance with the provisions of the Termination Letter, this Agreement shall terminate except with respect to
Section 2(b). 
 6. Miscellaneous. 

(a) The Company and the Trustee each acknowledge that the Trustee will follow the security procedures set forth below with respect to funds
transferred from the Trust Account. The Company and the Trustee will each restrict access to confidential information relating to such security procedures to authorized persons. Each party must notify the other party immediately if it has
reason to believe unauthorized persons may have obtained access to such confidential information, or of any change in its authorized personnel. In executing funds transfers, the Trustee shall rely upon all information supplied to it by the
Company, including, account names, account numbers, and all other identifying information relating to a Beneficiary, Beneficiary’s bank or intermediary bank. Except for any liability arising out of the Trustee’s gross negligence,
fraud or willful misconduct, the Trustee shall not be liable for any loss, liability or expense resulting from any error in the information or transmission of the funds. 

(b) This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York, without giving effect
to conflicts of law principles that would result in the application of the substantive laws of another jurisdiction.
 (c) This Agreement
contains the entire agreement and understanding of the parties hereto with respect to the subject matter hereof. Except for Section 1(i), Section 1(j) and Section 1(k) hereof (which may not be modified, amended or deleted without the
affirmative vote of sixty five percent (65%) of the then outstanding Common Shares and Class B common shares, par value $0.0001 per share, of the Company voting together as a single class; provided that no such amendment will affect any Public
Shareholder who has otherwise indicated his election to redeem his Common Shares in connection with a shareholder vote sought to amend this Agreement), this Agreement or any provision hereof may only be changed, amended or modified (other than to
correct a typographical error) by a writing signed by each of the parties hereto. 
 (d) The parties hereto consent to the jurisdiction and
venue of any state or federal court located in the City of New York, State of New York, for purposes of resolving any disputes hereunder. AS TO ANY CLAIM, CROSS-CLAIM OR COUNTERCLAIM IN ANY WAY RELATING TO THIS AGREEMENT, EACH PARTY WAIVES THE
RIGHT TO TRIAL BY JURY. 

  
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 (e)    Any notice, consent or request to be given in connection with any of
the terms or provisions of this Agreement shall be in writing and shall be sent by express mail or similar private courier service, by certified mail (return receipt requested), by hand delivery or by facsimile or electronic mail transmission: 

if to the Trustee, to: 

Continental Stock Transfer & Trust Company 

17 Battery Place 

New York, New York 10004 

Attn: Steven G. Nelson or Sharmin Carter 

Fax No.: (212) 509-5150 

if to the Company, to: 

Hunter Maritime Acquisition Corp. 

c/o MI Management Company 

Attention: Ludovic Saverys 

Trust Company Complex, Suite 206 

Ajeltake Road, P.O. Box 3055 

Majuro, Marshall Islands, MH96960 

Email: Ludovic.Saverys@cmb.be 

in each case, with copies to: 

Seward & Kissel LLP 

One Battery Park Plaza 

New York, NY 10004 

Attn:    Gary J. Wolfe, Esq. 

            Robert E. Lustrin, Esq. 

Fax No.: (212) 480-8421 

Email: wolfe@sewkis.com 

and 

Morgan Stanley & Co. LLC 

1585 Broadway 

New York, NY 10036 

Attn: [•] 

Email: [•] 

  
 8 

 and 

Skadden, Arps, Slate, Meagher & Flom LLP 

525 University Avenue 

Palo Alto, CA 94301 

Attn:    Gregg A. Noel, Esq. 

            Michael J. Mies, Esq. 

Fax No.: (650) 470-4570 

Email: [•] 

(f) This Agreement may not be assigned by the Trustee without the prior consent of the Company. 

(g) Each of the Company and the Trustee hereby represents that it has the full right and power and has been duly authorized to enter into this
Agreement and to perform its respective obligations as contemplated hereunder. The Trustee acknowledges and agrees that it shall not make any claims or proceed against the Trust Account, including by way of set-off, and shall not be entitled to
any funds in the Trust Accounts under any circumstance. 
 (h) This Agreement is the joint product of the Trustee and the Company and each
provision hereof has been subject to the mutual consultation, negotiation and agreement of such parties and shall not be construed for or against any party hereto. 

(i) This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts
shall together constitute one and the same instrument. Delivery of a signed counterpart of this Agreement by facsimile or electronic transmission shall constitute valid and sufficient delivery thereof. 

(j) Each of the Company and the Trustee hereby acknowledges and agrees that Morgan Stanley & Co. LLC, on behalf of the Underwriters, is a
third party beneficiary of this Agreement. 
 (k) Except as specified herein, no party to this Agreement may assign its rights or delegate
its obligations hereunder to any other person or entity. 
 (l) The Trustee hereby consents to the inclusion of Continental Stock Transfer
& Trust Company in the Registration Statement and other material relating to the Offering. 
 [Signature Page Follows] 

  
 9 

 IN WITNESS WHEREOF, the parties have duly executed this Investment Management Trust
Agreement as of the date first written above. 
  

			
	Continental Stock Transfer & Trust Company,
	    as Trustee
		
	By:	 	  

		 	Name:
		 	Title:
	
	Hunter Maritime Acquisition Corp.
		
	By:	 	  

		 	Name:
		 	Title:

  

  
 [Signature Page to
Investment Management Trust Agreement] 

 EXHIBIT A 

[Letterhead of Company] 

[●] 
 Continental Stock
Transfer & Trust Company 
 17 Battery Place 
 New
York, New York 10004 
 Attn: Steven G. Nelson or Sharmin Carter 
  

	 	Re:	Trust Account No.                Termination Letter 

Gentlemen: 
 Pursuant to
Section 1(i) of the Investment Management Trust Agreement between Hunter Maritime Acquisition Corp. (the “Company”) and Continental Stock Transfer & Trust Company (the
“Trustee”), dated as of [•], 2016 (the “Trust Agreement”), this is to advise you that the Company has entered into an agreement with
                 (the “Target Business”) to consummate a business combination with Target Business (the “Business
Combination”) on or about [●]. The Company shall notify you at least ninety-six (96) hours in advance of the actual date of the consummation of the Business Combination (“Consummation
Date”). Capitalized terms used but not defined herein shall have the meanings set forth in the Trust Agreement. 
 In
accordance with the terms of the Trust Agreement, we hereby authorize you to commence to liquidate all of the assets of the Trust Accounts on [insert date], and to transfer the proceeds into the above-referenced trust checking account at KBC Bank to
the effect that, on the Consummation Date, all of funds held in the Trust Accounts will be immediately available for transfer to the account or accounts that the Company and Morgan Stanley & Co. LLC (“Morgan Stanley”)
(with respect to the Deferred Discount) shall direct on the Consummation Date. It is acknowledged and agreed that while the funds are on deposit in the trust checking account at KBC Bank awaiting distribution, neither the Company nor Morgan
Stanley will earn any interest or dividends. 
 On the Consummation Date (i) counsel for the Company shall deliver to you written
notification that the Business Combination has been consummated, or will be consummated substantially concurrently with your transfer of funds to the accounts as directed by the Company (the “Notification”) and (ii) the
Company shall deliver to you (a) a certificate of the Chief Executive Officer, Chief Financial Officer, or Secretary, which verifies that the Business Combination has been approved by a vote of the Company’s shareholders, if a vote is held and
(b) joint written instruction signed by the Company and Morgan Stanley with respect to the transfer of the funds held in the Trust Accounts, including payment of the Deferred Discount from the Trust Accounts (the “Instruction
Letter”). You are hereby directed and authorized to transfer the funds held in the Trust Accounts immediately upon your receipt of the Notification and the Instruction Letter, in accordance with the terms of the Instruction
Letter. In the event that certain deposits held in the Trust Accounts may not be liquidated by the Consummation Date without penalty, you will notify the Company in writing of the same and the Company shall

  
 A-1 

 
direct you as to whether such funds should remain in the Trust Accounts and be distributed after the Consummation Date to the Company. Upon the distribution of all the funds, net of any
payments necessary for reasonable unreimbursed expenses related to liquidating the Trust Accounts, your obligations under the Trust Agreement shall be terminated. 

In the event that the Business Combination is not consummated on the Consummation Date described in the notice thereof and we have not
notified you on or before the original Consummation Date of a new Consummation Date, then upon receipt by the Trustee of written instructions from the Company, the funds held in the Trust Accounts shall be reinvested as provided in
Section 1(c) of the Trust Agreement on the business day immediately following the Consummation Date as set forth in the notice as soon thereafter as possible. 

 

			
	Very truly yours,
	Hunter Maritime Acquisition Corp.
		
	By:	 	  

		 	Name:
		 	Title:

 cc: Morgan Stanley & Co. LLC 

  
 A-2 

 EXHIBIT B 

[Letterhead of Company] 

[Insert date] 
 Continental Stock
Transfer & Trust Company 
 17 Battery Place 
 New
York, New York 10004 
 Attn: Steven G. Nelson or Sharmin Carter 
  

	 	Re:	Trust Account No. [                ] Termination Letter 

Gentlemen: 
 Pursuant to
Section 1(i) of the Investment Management Trust Agreement between Hunter Maritime Acquisition Corp. (the “Company”) and Continental Stock Transfer & Trust Company (the
“Trustee”), dated as of [•], 2016 (the “Trust Agreement”), this is to advise you that the Company has been unable to effect a business combination with a Target Business (the “Business
Combination”) within the time frame specified in the Company’s Amended and Restated Articles of Incorporation, as described in the Company’s Prospectus relating to the Offering. Capitalized terms used but not defined
herein shall have the meanings set forth in the Trust Agreement. 
 In accordance with the terms of the Trust Agreement, we hereby authorize
you to liquidate all of the assets in the Trust Accounts on [•], 2018 and to transfer the total proceeds into the trust checking account at KBC Bank to await distribution to the Public Shareholders. These instructions will be provided to
you at least ninety-six (96) hours in advance of the expected distributions. The Company has selected [•], 2018, as the record date for the purpose of determining the Public Shareholders entitled to receive their share of the liquidation
proceeds. You agree to be the Paying Agent of record and, in your separate capacity as Paying Agent, agree to distribute said funds directly to the Company’s Public Shareholders in accordance with the terms of the Trust Agreement and the
Amended and Restated Articles of Incorporation of the Company. Upon the distribution of all the funds, your obligations under the Trust Agreement shall be terminated, except to the extent otherwise provided in Section 1(j) of the
Trust Agreement. 
  

			
	Very truly yours,
	Hunter Maritime Acquisition Corp.
		
	By:	 	  

		 	Name:
		 	Title:

 cc: Morgan Stanley & Co. LLC 

  
 B-1 

 EXHIBIT C 

[Letterhead of Company] 

[Insert date] 
 Continental Stock
Transfer & Trust Company 
 17 Battery Place 
 New
York, New York 10004 
 Attn: Steven G. Nelson or Sharmin Carter 
  

	 	Re:	Trust Account No.                 Withdrawal Instruction 

Gentlemen: 
 Pursuant to
Section 1(j) of the Investment Management Trust Agreement between Hunter Maritime Acquisition Corp. (the “Company”) and Continental Stock Transfer & Trust Company (the
“Trustee”), dated as of [•], 2016 (the “Trust Agreement”), the Company hereby requests that you deliver to the Company
$                 of the investment income earned on the Property as of the date hereof. Capitalized terms used but not defined herein shall have the meanings set
forth in the Trust Agreement. 
 The Company needs such funds [to pay for the tax obligations as set forth on the attached tax return or tax
statement][for working capital purposes] [for dissolution expenses]. In accordance with the terms of the Trust Agreement, you are hereby directed and authorized to transfer (via wire transfer) such funds promptly upon your receipt of this
letter to the Company’s operating account at: 
 [WIRE INSTRUCTION INFORMATION] 

 

			
	Very truly yours,
	Hunter Maritime Acquisition Corp.
		
	By:	 	  

		 	Name:
		 	Title:

 cc: Morgan Stanley & Co. LLC 

  
 C-1 

 EXHIBIT D 

[Letterhead of Company] 

[Insert date] 
 Continental Stock
Transfer & Trust Company 
 17 Battery Place 
 New
York, New York 10004 
 Attn: Steven G. Nelson or Sharmin Carter 
  

	 	Re:	Trust Account No.                 Withdrawal Instruction 

Gentlemen: 
 Pursuant to
Section 1(k) of the Investment Management Trust Agreement between Hunter Maritime Acquisition Corp. (the “Company”) and Continental Stock Transfer & Trust Company (the
“Trustee”), dated as of [•], 2016 (the “Trust Agreement”), the Company hereby requests that you deliver to the redeeming Public Shareholders on behalf of the Company
$                 of the principal and investment income earned on the Property as of the date hereof. Capitalized terms used but not defined herein shall have the
meanings set forth in the Trust Agreement. 
 The Company needs such funds to pay its Public Shareholders who have properly elected to have
their Common Shares redeemed by the Company in connection with a shareholder vote to approve an amendment to the Company’s Amended and Restated Articles of Incorporation that affects the substance or timing of the Company’s obligation to
redeem 100% of its public Common Shares if the Company has not consummated an initial Business Combination within such time as is described in the Company’s Amended and Restated Articles of Incorporation. As such, you are hereby directed and
authorized to transfer (via wire transfer) such funds promptly upon your receipt of this letter to the redeeming Public Shareholders in accordance with your customary procedures. 

 

			
	Very truly yours,
	Hunter Maritime Acquisition Corp.
		
	By:	 	  

		 	Name:
		 	Title:

 cc: Morgan Stanley & Co. LLC 

  
 C-2 

 SCHEDULE A 
  

							
	 Fee Item
	  	 Time and method of payment
	  	Amount	 
	 Initial acceptance fee
	  	Initial closing of the Offering by wire transfer.	  	$	4,500.00	  
	 Annual fee
	  	First year fee payable at initial closing of the Offering by wire transfer, thereafter on the anniversary of the effective date of the Offering by wire transfer or check.	  	$	11,500.00	  
	 Transaction processing fee for disbursements to Company under Sections 1(i), 1(j) and
1(k)
	  	Deduction by Trustee from accumulated income following disbursement made to Company under Section 1	  	$	250.00	  
	 Paying Agent services as required pursuant to Section 1(i)
	  	Billed to Company upon delivery of service pursuant to Section 1(i)	  	 
 	Prevailing
rates	  
  

  
 Sched. A-1kos_Ex10_1

		
			Exhibit 10.1
		

		
			 
		

		
			 
		

		
			 
		

		
			PETROLEUM AGREEMENT
		

		
			 
		

		
			 
		

		
			REGARDING
		

		
			 
		

		
			 
		

		
			THE EXPLORATION FOR AND EXPLOITATION OF HYDROCARBONS
		

		
			 
		

		
			 
		

		
			BETWEEN
		

		
			 
		

		
			 
		

		
			OFFICE NATIONAL DES HYDROCARBURES ET DES MINES 
		

		
			“ONHYM”
		

		
			ACTING ON BEHALF OF THE STATE
		

		
			 
		

		
			 
		

		
			AND
		

		
			 
		

		
			 
		

		
			KOSMOS ENERGY MAROC MER PROFONDE
		

		
			“KOSMOS”
		

		
			 
		

		
			 
		

		
			AND
		

		
			 
		

		
			CAPRICORN EXPLORATION AND DEVELOPMENT COMPANY LIMITED
		

		
			"CAPRICORN"
		

		
			 
		

		
			 
		

		
			IN THE AREA OF INTEREST NAMED
		

		
			 
		

		
			“BOUJDOUR MARITIME”
		

		
			 
		

		
			
		

		
			

		 

		

			1

		

 

		

		
			THIS PETROLEUM AGREEMENT IS CONCLUDED
		

		
			 
		

		
			BETWEEN
		

		
			 
		

		
			The OFFICE NATIONAL DES HYDROCARURES ET DES MINES, hereinafter referred to as “ONHYM”, a public Moroccan entity instituted by law n°33-01, promulgated by dahir n° 1-03-203 on the date of 16 Ramadan 1424 (11 November 2003) and implemented by decree n°2-04-372 on the date of the 16 Kaada 1425 (29 December 2004), whose registered office is at 5, Avenue Moulay Hassan – BP 99, Rabat, Morocco, acting on behalf of the Kingdom of Morocco, hereinafter called “the STATE”, herein represented by its General Director, Mme. Amina BENKHADRA;
		

		
			 
		

		
			AND
		

		
			 
		

		
			KOSMOS ENERGY MAROC MER PROFONDE, a company incorporated under the laws of the Cayman Islands, whose registered office is at Wilmington Trust Company, 4th Floor Century Yard, Cricket Square, P.O. Box 32322, George Town, Grand Cayman, KY1 1209 Cayman Islands, hereinafter referred to as “KOSMOS”, herein represented by its Attorney in Fact, Mr. William HAYES;
		

		
			 
		

		
			AND
		

		
			 
		

		
			CAPRICORN EXPLORATION AND DEVELOPMENT COMPANY LIMITED, a company incorporated under the laws of Scotland, whose registered office is at 50 Lothian Road, Edinburgh EH3 9BY United Kingdom, hereinafter referred to as “CAPRICORN”, herein represented by its Director, Mr. Simon THOMSON.
		

		
			 
		

		
			KOSMOS, CAPRICORN and ONHYM  are hereinafter collectively referred to as the “Parties” or individually as a “Party”.
		

		
			 
		

		
			KOSMOS and CAPRICORN are hereinafter collectively referred to as "CONTRACTOR GROUP".
		

		
			 
		

		
			
		

		
			

		 

		

			2

		

 

		

		
			TABLE OF CONTENTS
		

		
			 
		

			
					
						- PREAMBLE -

					
5 
				
	
					
						 

					
					
						 

				
	
					
						PART I   PURPOSE AND TERM OF THE PETROLEUM AGREEMENT

					
6 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 1 - PURPOSE OF THE PETROLEUM AGREEMENT

					
7 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 2 - TERM AND EXPIRY OF THE PETROLEUM AGREEMENT

					
8 
				
	
					
						 

					
					
						 

				
	
					
						PART II – EXPLORATION PERMITS AND WORKS

					
9 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 3 - EXPLORATION PERMITS

					
10 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 4 - EXPLORATION WORKS

					
12 
				
	
					
						 

					
					
						 

				
	
					
						PART III – EXPLOITATION CONCESSION

					
16 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 5 - HYDROCARBON EXPLOITATION

					
17 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 6 - MARKET PRICE

					
19 
				
	
					
						 

					
					
						 

				
	
					
						PART IV – THE PARTIES’ OBLIGATIONS

					
20 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 7 - APPLICABLE LAW

					
21 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 8 – SUPERVISION AND ASSISTANCE

					
22 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 9 – PROFESSIONAL TRAINING

					
23 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 10 –SAFETY AND ENVIRONMENT

					
24 
				
	
					
						 

					
					
						 

				
	
					
						PART V – FISCAL PROVISONS

					
25 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 11 – ANNUAL ROYALTY

					
26 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 12 –CORPORATE TAX

					
28 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 13 – CUSTOMS

					
29 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 14 - FOREIGN EXCHANGE AND OTHER FISCAL PROVISIONS

					
30 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 15 – BONUSES

					
31 
				
	
					
						 

					
					
						 

				
	
					
						PART VI – MISCELLANEOUS PROVISIONS

					
33 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 16 – ASSOCIATION CONTRACT

					
34 
				
	
					
						 

					
					
						 

				

		 

		

			3

		

 

	
					
						

					
						ARTICLE 17 – THE OPERATOR

					
35 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 18 – CONFIDENTIALITY

					
36 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 19 – FORCE MAJEURE

					
38 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 20 – ARBITRATION

					
39 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 21 – ECONOMIC STABILITY OF CONTRACTOR GROUP

					
40 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 22 – ASSIGNMENT AND TRANSFER OF RIGHTS AND OBLIGATIONS

					
41 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 23 – NOTICES

					
42 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 24 – OTHER PROVISIONS

					
44 
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE 25 – EFFECTIVE DATE

					
45 
				
	
					
						 

					
					
						 

				
	
					
						APPENDIX I – DEFINITIONS

					
47 
				
	
					
						 

					
					
						 

				
	
					
						APPENDIX II – MAP AND DESCRIPTION OF THE AREA OF INTEREST

					
51 
				
	
					
						 

					
					
						 

				
	
					
						APPENDIX III – LIST OF DELIVERABLES

					
69 
				
	
					
						 

					
					
						 

				
	
					
						APPENDIX IV - JOINT DECLARATION OF PRINCIPLES

					
71 
				

		
			 
		

		
			
		

		
			

		 

		

			4

		

 

		

		
			PREAMBLE  -
		

		
			 
		

		
			 
		

		
			Whereas, the law no 21‐90 enacted by the dahir no  1‐91‐118 of 27 Ramadan 1412 (1 April 1992) modified and supplemented by law no 27‐99 enacted by the dahir no  1‐99-340 of 9 Kaada 1420 (15 February 2000), hereinafter referred to as the "Hydrocarbon Law" regulates the exploration for and the exploitation of hydrocarbon deposits in Morocco, implemented by the decree no  2‐93‐786 of 18 Joumada I 1414 (3 November 1993) modified and supplemented by decree no  2‐99‐210 of 9 Hija 1420 (16 March 2000) hereinafter referred to as the "Decree", the Hydrocarbon Law and the Decree being hereinafter referred to as the "Hydrocarbon Code";
		

		
			 
		

		
			Whereas, section 5 of the decree n°2-04-372 of 16 Kaada 1425 (29 December 2004) implementing the law n° 33-01 instituting the OFFICE NATIONAL DES HYDROCARBURES ET DES MINES which empowers ONHYM to carry out on behalf of the State the functions resulting from the provisions of section 71 of the Hydrocarbon Law;
		

		
			 
		

		
			Taking into account the shared desire of the Parties to carry out and perform the exploration for and the exploitation of hydrocarbon deposits in the Exploration Permits referred to as "Boujdour Maritime I", "Boujdour Maritime II", "Boujdour Maritime III", “Boujdour Maritime IV", “Boujdour Maritime V", “Boujdour Maritime VI" “Boujdour Maritime VII", “Boujdour Maritime VIII", “Boujdour Maritime IX", “Boujdour Maritime X", “Boujdour Maritime XI", “Boujdour Maritime XII", “Boujdour Maritime XIII", “Boujdour Maritime XIV", “Boujdour Maritime XV”, “Boujdour Maritime XVI” and “Boujdour Maritime XVII” constituting the Area of Interest as specified in Article 3 and in Appendix II of this Agreement.
		

		
			 
		

		
			 
		

		
			 
		

		
			NOW THE FOLLOWING HAS BEEN AGREED:
		

		
			 
		

		
			
		

		
			

		 

		

			5

		

 

		

		
			 
		

		
			 
		

		
			 
		

		
			PART I ‐ PURPOSE AND TERM OF THE PETROLEUM AGREEMENT
		

		
			 
		

		
			 
		

		
			 
		

		
			
		

		
			

		 

		

			6

		

 

		

		
			ARTICLE 1 ‐ PURPOSE OF THE PETROLEUM AGREEMENT
		

		
			 
		

		
			 
		

		
			1.1       The purpose of this Petroleum Agreement of which the Appendices form an integral part is to set out the rights and obligations of the Parties within the Area of Interest comprised of the Exploration Permits and any Exploitation Concession(s).  
		

		
			 
		

		
			1.2       Definitions of the words, terms and phrases used in this Agreement are set forth in Appendix I attached hereto.
		

		
			 
		

		
			
		

		
			

		 

		

			7

		

 

		

		
			ARTICLE 2 - TERM AND EXPIRY OF THE PETROLEUM AGREEMENT
		

		
			 
		

		
			 
		

		
			This Agreement shall enter into effect in accordance with the provisions of Article 25 of this Agreement and shall terminate in the following circumstances:  
		

		
			 
		

		
			2.1       if there is no discovery of Hydrocarbons during the period of validity of the Exploration Permits to which this Agreement relates;
		

		
			 
		

		
			2.2       upon expiry of the period of validity of the last Exploitation Concession in production obtained pursuant to Article 5 of this Agreement or upon the total depletion of the Hydrocarbon deposit if this occurs prior to the expiry of such Exploitation Concession period; 
		

		
			 
		

		
			2.3        if CONTRACTOR GROUP elects to abandon its total Participating Interest in the Exploration Permits and in the Exploitation Concession(s) in accordance with the provisions of Article 3.6 of this Agreement; 
		

		
			 
		

		
			2.4       upon the termination of all of the Exploration Permits and/or all the Exploitation Concession(s) in accordance with the Hydrocarbon Code.
		

		
			 
		

		
			
		

		
			

		 

		

			8

		

 

		

		
			 
		

		
			 
		

		
			 
		

		
			PART II – EXPLORATION PERMITS AND WORKS
		

		
			 
		

		
			 
		

		
			 
		

		
			
		

		
			

		 

		

			9

		

 

		

		
			ARTICLE 3 ‐ EXPLORATION PERMITS
		

		
			 
		

		
			3.1
		

		
			3.1.1   In accordance with the Hydrocarbon Code, ONHYM and CONTRACTOR GROUP have jointly filed with the appropriate department of the Ministry in charge of Energy the applications for the following Exploration Permits referred to as "Boujdour Maritime I", "Boujdour Maritime II", "Boujdour Maritime III", “Boujdour Maritime IV", “Boujdour Maritime V", “Boujdour Maritime VI" “Boujdour Maritime VII", “Boujdour Maritime VIII", “Boujdour Maritime IX", “Boujdour Maritime X", “Boujdour Maritime XI", “Boujdour Maritime XII", “Boujdour Maritime XIII", “Boujdour Maritime XIV", “Boujdour Maritime XV”, “Boujdour Maritime XVI” and “Boujdour Maritime XVII” which together comprise the Area of Interest.
		

		
			 
		

		
			3.1.2   In accordance with the second paragraph of section 4 of the Hydrocarbon Law, the Participating Interests of the Parties in the Exploration Permits which will be granted to them by the Minister in charge of Energy are:
		

		
			 
		

		
			ONHYM                          25.00%
		

		
			KOSMOS                        55.00%
		

		
			CAPRICORN                   20.00%
		

		
			 
		

		
			3.2      The Exploration Permits cover an initial approximate area of 33,733.9 km2 and are delineated by their geographic co‐ordinates as detailed in Appendix II attached hereto.  
		

		
			 
		

		
			3.3      The Exploration Permits shall have an overall duration of validity of eight (8) years      comprising an Initial Period of forty-eight (48) months followed by a First Extension Period of twenty-four (24) months, and a Second Extension Period of twenty-four (24) months, except if an exceptional extension is applied for by the Parties, with this being pursuant to section 24 paragraph 2 of the Hydrocarbon Law.  
		

		
			 
		

		
			3.4      If during the last six (6) months of the Initial Period or the First Extension Period of the Exploration Permits, CONTRACTOR GROUP justifies the necessity to extend the duration of the above mentioned period, in order to complete the Minimum Exploration Work Program commenced, then at least three (3) months prior to the expiry of the Initial Period or the First Extension Period, CONTRACTOR GROUP shall notify ONHYM of its request for an extension, provided that the total duration of the Exploration Permits shall not exceed eight (8) years.
		

		
			 
		

		
			3.5      Applications for extensions of the Exploration Permits along with reductions in surface area shall be made in accordance with sections 22 and 24 of the Hydrocarbon Law and sections 10, 14, 15 and 16 of the Decree.
		

		
			 
		

		
			3.6     The partial or total abandonment of the Exploration Permits as well as the partial or total transfer of CONTRACTOR GROUP’s Participating Interests shall be effected in accordance with the Hydrocarbon Code and Article 22 of this Agreement.
		

		
			
		

		
			

		 

		

			10

		

 

		

		
			3.7      The Parties agree that in the case where a Natural Gas Discovery is made during the validity period, but the commerciality of such discovery cannot be declared due to the non-conclusion of one or more sales contract(s) of this Natural Gas, the Parties shall file at the end of the validity period with the appropriate department of the Ministry in charge of Energy applications for one or more exploration permit(s) covering the area(s) where the discovery(ies) is(are) located. The exploration permit application(s) shall set out the minimum exploration work program which shall consist of evaluation and feasibility study(ies) of the said Natural Gas discovery(ies).  The Parties, in accordance with section 4 of the Hydrocarbon Law, shall sign a petroleum agreement in respect of the said exploration permit or exploration permits the provisions of which, with the exception of the minimum exploration work program, shall be in accordance with this Petroleum Agreement.
		

		
			 
		

		
			
		

		
			

		 

		

			11

		

 

		

		
			ARTICLE 4 ‐ EXPLORATION WORKS
		

		
			 
		

		
			4.1       DEFINITION OF THE EXPLORATION WORKS
		

		
			 
		

		
			4.1.1    Exploration Works shall mean all exploration and appraisal operations which seek to establish the existence of Hydrocarbons in commercially exploitable quantities, conducted in, or related to the Area of Interest in the context of both the Exploration Permits and the Exploitation Concession(s), whether these operations are carried out inside or outside of Morocco.
		

		
			 
		

		
			4.1.2    Exploration Works include but are not limited to the following:
		

		
			i)     hydrographic, geodesic, meteorological and topographic studies and surveys (if these operations are necessary for the Exploration Works) and, in the case of appraisal works, operations needed to determine the limits and the productive capacity of a Hydrocarbon deposit in order to assist in making a decision whether or not to develop such Hydrocarbon deposit;  
		

		
			ii)    geological and geophysical studies and surveys; 
		

		
			iii)   studies and surveys aimed at determining the locations of exploration and appraisal wells;
		

		
			iv)   drilling operations regarding exploration and appraisal wells; 
		

		
			v)    tests and studies for the appraisal of reservoirs.
		

		
			 
		

		
			4.2       During the period of validity of the Exploration Permits, CONTRACTOR GROUP  undertakes to perform at the least the following Minimum Exploration Work Program and, subject to the conditions and the schedule detailed below, to devote sufficient funding thereto in accordance with the conditions and the schedule set out below:
		

		
			 
		

		
			4.2.1    CONTRACTOR GROUP undertakes during the Initial Period of forty-eight (48) months from the Effective Date to carry out the following Minimum Exploration Work Program:
		

		
			 
		

		
			-       Acquisition, interpretation and PSDM processing of a 3D seismic survey of five thousand (5,000) to seven thousand five hundred (7,500) square kilometers. 
		

		
			 
		

		
			-       Technical work: Technical work to be performed during the course of the Initial Period shall include completion of the PSDM processing of the existing and newly acquired 3D seismic data, as well as its interpretation, and an updated petroleum systems analysis.
		

		
			 
		

		
			The budget and the Minimum Expenditure Obligation for the Minimum Exploration Work Program during the forty-eight months of the Initial Period is twenty-five million US Dollars ($U.S. 25,000,000).
		

		
			 
		

		
			Data relating to the technical work and the 3D seismic acquisition and processing, and all data which stems therefrom shall be delivered to ONHYM.
		

		
			
		

		
			

		 

		

			12

		

 

		

		
			4.2.2    If CONTRACTOR GROUP elects pursuant to section 15 of the Decree, to enter into the First Extension Period of twenty-four (24) months duration, CONTRACTOR GROUP shall during such period drill one (1) exploration well and, if CONTRACTOR GROUP so decides, one (1) additional exploration well or appraisal well. Any exploration well will be drilled to a minimum depth of 2,000 meters below the sea floor or to such depth as formations of Jurassic ages are encountered, whichever of such objectives is achieved first. The objectives of the exploration or appraisal drilling will be confirmed by common agreement during a meeting of the management committee. The corresponding Minimum Expenditure Obligation is fifty million U.S. Dollars ($ U.S. 50,000,000).
		

		
			Notwithstanding the foregoing, the Parties further agree that, if during the execution by the Operator of the drilling of each of the wells set out in the first paragraph of this Article 4.2.2, technical difficulties such as the presence of impenetrable substances or strata, or unsafe conditions are encountered, and which the Operator is not able to overcome using good and prudent oil field practices in accordance with international oilfield standards, such event shall be considered a Force Majeure event for the purpose of this Agreement. In the event of Force Majeure arising in accordance with this Article4.2.2 and Article 19 then Operator shall notify the management committee that an event of Force Majeure has so arisen, and which matter must be deemed to be an Urgent Operational Matter, and be voted on within twenty four (24) hours following receipt of said notification. If the management committee votes to approve the Operator’s proposal, then it may cease operations, and the drilling of the well where such difficulties were encountered shall be deemed completed.
		

		
			 
		

		
			4.2.3    If CONTRACTOR GROUP elects, pursuant to section 15 of the Decree, to enter into the Second Extension Period of twenty-four (24) months duration, CONTRACTOR GROUP shall during such period drill one (1) exploration well or appraisal well and, contingent on CONTRACTOR GROUP election, one (1) additional exploration well or  appraisal well. Any exploration well will be drilled to a minimum depth of 2,000 meters below the sea floor or to such depth as formations of Jurassic ages are encountered, whichever of such objectives is achieved first. The objectives of the exploration or appraisal drilling will be confirmed by common agreement during a meeting of the management committee. The corresponding Minimum Expenditure Obligation is fifty million U.S. Dollars ($ U.S. 50,000,000).
		

		
			Notwithstanding the foregoing, the Parties further agree that, if during the execution by the Operator of the drilling of each of the well set out in the first paragraph of this Article 4.2.3, technical difficulties such as the presence of impenetrable substances or strata, or unsafe conditions are encountered, and which the Operator is not able to overcome using good and prudent oil field practices in accordance with international oilfield standards, such event shall be considered a Force Majeure event for the purpose of this Agreement. In the event of Force Majeure arising in accordance with this Article 4.2.3 and Article 19, then Operator shall notify the management committee that an event of Force Majeure has so arisen, and which matter must be deemed to be an Urgent Operational Matter, and be voted on within twenty four (24) hours following receipt of said notification. If the management committee votes to approve the Operator’s proposal, then it may cease
		

		
			
		

		
			

		 

		

			13

		

 

		

		
			operations, and the drilling of the well where such difficulties were encountered shall be deemed completed.
		

		
			 
		

		
			4.2.4    The Parties agree that all expenses incurred in the performance of Exploration Works shall be borne entirely by CONTRACTOR GROUP with no reimbursement by ONHYM. All such expenses shall be considered as exploration costs incurred by CONTRACTOR GROUP.  
		

		
			 
		

		
			4.2.5    All Exploration Works performed and expenses incurred by CONTRACTOR GROUP in respect thereto after the Effective Date of this Agreement shall be taken into account, in their entirety, in the evaluation of the fulfilment of the Minimum Exploration Work Program and the Minimum Expenditure Obligation. Performance of the Minimum Exploration Work Program shall be considered as the performance of the Minimum Expenditure Obligation.
		

		
			 
		

		
			It is understood between the Parties that the Minimum Exploration Work Program of the First Extension Period is limited to the drilling of one exploration well, and that the Minimum Exploration Work Program of the Second Extension Period is limited to the drilling of one exploration well or one appraisal well.  The additional well, which may be drilled at the option of the CONTRACTOR GROUP during the First Extension Period or the Second Extension Period, is optional and shall not serve to create an additional element of the Minimum Exploration Work Program for such period.
		

		
			 
		

		
			Furthermore, if and insofar as any Exploration Work in the Minimum Exploration Work Program detailed in Articles 4.2.2 and 4.2.3 above has been carried out by CONTRACTOR GROUP prior to the commencement of any of the Extension Periods, such Exploration Work may be credited for the purposes of Articles 4.2.2 and 4.2.3 above.
		

		
			 
		

		
			However, if and insofar as CONTRACTOR GROUP has carried out the Exploration Work as set out in Articles 4.2.2 and 4.2.3 above prior to the commencement of any of the Extension Periods and if CONTRACTOR GROUP decides to enter into the following Extension Period, CONTRACTOR GROUP and ONHYM will file an application to enter into the First Extension Period, and/or the Second Extension Period together with the Minimum Exploration Work Program which will be conducted within the Area of Interest during such Extension Period.
		

		
			 
		

		
			4.2.6    No later than the date of signature of this Agreement, OPERATOR shall provide to ONHYM a bank guarantee which form is acceptable to ONHYM and issued by a Moroccan bank or a foreign bank that has an agency in Morocco ("Guarantee"). This Guarantee will be irrevocable after the date of its entry into force. The amount of the Guarantee will be equal to twenty-five percent (25%) of the Minimum Expenditure Obligation of the Initial Period. 
		

		
			 
		

		
			Furthermore, as soon as CONTRACTOR GROUP informs ONHYM of its decision to carry out the Exploration Works of the First Extension Period and of the Second Extension Period, as set out in Articles 4.2.2 and 4.2.3 above, OPERATOR will provide ONHYM with a Guarantee
		

		
			
		

		
			

		 

		

			14

		

 

		

		
			for each given period in the same terms as set out in Article 4.2.6 above, except that the amount of each given Guarantee shall be equal to thirty percent (30%) of the Minimum Expenditure Obligation for the First Extension Period and for the Second Extension Period, respectively. The Guarantee shall be reduced to a residual amount of five hundred thousand U.S. Dollars ($ U.S. 500,000) when the CONTRACTOR GROUP has satisfied the Minimum Exploration Work Program for the Initial Period, the First Extension Period, and the Second Extension Period, as applicable.
		

		
			 
		

		
			Notification of the reduction of the Guarantee to the residual amount of five hundred thousand U.S. Dollars ($ U.S. 500,000) shall be notified by ONHYM to the bank, once OPERATOR has remitted to ONHYM all data and documentation relating to the exploration works carried out within the Area of Interest.
		

		
			 
		

		
			Notification of the Release of the Guarantee shall be notified by ONHYM to the bank, once OPERATOR has completed the then current training program, and/or made the payment of any cumulative remaining amount to ONHYM, as described in Article 9.3 below.
		

		
			 
		

		
			4.2.7    If CONTRACTOR GROUP has not completed the Minimum Exploration Work Program, totally or partially, within the period for which it had undertaken to perform such work, except in the case of non-execution due to a Force Majeure event, it will pay an amount equal to the Minimum Expenditure Obligation, for said period for the totality of the Minimum Exploration Work Program.
		

		
			 
		

		
			It is understood that upon payment thereof, CONTRACTOR GROUP shall be deemed to have satisfied its obligations in respect of the Minimum Exploration Work Program for said period.  
		

		
			 
		

		
			Subject to the above, it is understood and expressly agreed that it is the accomplishment of the Minimum Exploration Work Program and not the expenditures associated with the Minimum Expenditure Obligation which shall determine the accomplishment by the CONTRACTOR GROUP  of the commitments resulting from this Agreement.
		

		
			 
		

		
			4.2.8    ONHYM shall have the right to audit the expenditures pertaining to the Exploration Work undertaken during the course of the Initial Period and of all Extension Periods in accordance with the terms agreed between the Parties in the Association Contract.
		

		
			 
		

		
			4.3        The income from the Hydrocarbons produced by CONTRACTOR GROUP during testing, performed prior to the application for the relevant Exploitation Concession being filed by the Parties, shall, following recovery by CONTRACTOR GROUP of the costs incurred in the performance of the Operations relating to such production testing, be shared by the Parties pro rata to their respective Participating Interests as noted in Article 5.2 below.
		

		
			
		

		
			

		 

		

			15

		

 

		

		
			 
		

		
			 
		

		
			 
		

		
			 
		

		
			PART III – EXPLOITATION CONCESSION
		

		
			 
		

		
			 
		

		
			 
		

		
			
		

		
			

		 

		

			16

		

 

		

		
			ARTICLE 5 ‐ HYDROCARBON EXPLOITATION
		

		
			 
		

		
			5.1       In accordance with the provisions of section 27 of the Hydrocarbon Law, the discovery of a commercially exploitable Hydrocarbon deposit shall give ONHYM and CONTRACTOR GROUP the right to obtain, at their request, an Exploitation Concession covering all of the area of said deposit. The maximum term of validity of the Exploitation Concession shall be for twenty‐five (25) years. However, one single exceptional extension, not to exceed ten (10) years, may be granted upon application by ONHYM and/or CONTRACTOR GROUP, as the case may be, if a reasonable and cost‐effective exploitation of the deposit is so justified in the opinion of the Parties requesting an extension. 
		

		
			 
		

		
			5.2       At the Effective Date, the undivided Participating Interests of the Parties in any Exploitation Concession shall be as follows:
		

		
			 
		

		
			ONHYM                                   25%
		

		
			KOSMOS                                  55%
		

		
			CAPRICORN                             20%
		

		
			 
		

		
			5.3      In the event that a Party elects not to apply for an Exploitation Concession, the sole risk procedures agreed by the Parties, in the Association Contract, shall apply. 
		

		
			 
		

		
			5.4      Expenses incurred after the effective date of the Exploitation Concession for the Development and Exploitation Works shall be funded by the Parties in proportion to their respective Participating Interests as fixed in Article 5.2 above. 
		

		
			 
		

		
			5.5      In the event that a discovery is declared a commercial discovery, as defined in section 28 of the Hydrocarbon Law, all costs relating to the preparation of the Development Plan shall be considered as forming part of the Development and Exploitation Works and shall be funded by the Parties in proportion to their respective Participating Interests as fixed in Article 5.2 above.  
		

		
			 
		

		
			5.6      ONHYM, KOSMOS and CAPRICORN, each being the sole owner at the Crude Oil Delivery Point of their respective Participating Interests in the Crude Oil produced from each Exploitation Concession, shall have the right to separately use, lift, freely market and freely export their share of the Available Crude Oil, subject to the terms of this Article 5.6 and Article 5.7 below:
		

		
			 
		

		
			5.6.1    Not later than ninety (90) days before commencement of production from the Exploitation Concession, the Parties shall sign an agreement (the "Lifting Agreement") the terms of which shall govern and specify the modalities for the separate lifting of Crude Oil by the Parties. The Lifting Agreement shall detail, inter alia, terms relating to each Party's share in the Crude Oil, the timetable for lifting nominations for each one of the Parties, under/overlift provisions, cargo procedures, vessel capacity acceptance procedures and failure to lift provisions.  
		

		
			
		

		
			

		 

		

			17

		

 

		

		
			5.6.2    Pursuant to section 41 of the Hydrocarbon Law, CONTRACTOR GROUP shall contribute to the needs of the domestic market under the conditions set out in Article 5.6.3 below.  
		

		
			 
		

		
			If the State so decides, then ONHYM shall have the right to purchase, at the Crude Oil Delivery Point, a portion of the quantity of Crude Oil to which CONTRACTOR GROUP is entitled. Subject to Article 5.6.3, ONHYM shall give CONTRACTOR GROUP not less than six (6) calendar months' written notice, stating the quantity of Crude Oil it intends to lift.
		

		
			 
		

		
			5.6.3    The quantity of Crude Oil that CONTRACTOR GROUP shall be required to offer for sale to the domestic market shall be either twenty percent (20%) of the share of Crude Oil to which CONTRACTOR GROUP is entitled, or the portion of the domestic market deficit that CONTRACTOR GROUP's share of the Crude Oil production under this Agreement bears to the aggregate production of Crude Oil from all the petroleum agreements in Morocco, whichever is the smaller. The domestic market deficit will take into account the share of Crude Oil to which ONHYM is entitled.
		

		
			 
		

		
			5.6.4    The price to be paid to CONTRACTOR GROUP for such sales of Crude Oil under Articles 5.6.2 and 5.6.3 shall be the Market Price, which shall be paid in accordance with the provisions of an agreement to be executed relating to the sale of Crude Oil.  The provisions of such agreement will be in accordance with those normally found in Crude Oil sales agreements for FOB transactions on normal international trade terms. 
		

		
			 
		

		
			5.6.5    Failure by ONHYM to make payment in accordance with the terms of the Crude Oil sales agreement shall, in addition to the default provisions of the Crude Oil sales agreement, result in the suspension of deliveries by CONTRACTOR GROUP to ONHYM, under Article 5.6.2, until such time as all outstanding payments for Crude Oil sales have been settled in accordance with the terms of the Crude Oil sales agreement.
		

		
			 
		

		
			5.7       If Natural Gas (either associated or non‐associated) is discovered in potentially commercial quantities, then CONTRACTOR GROUP and ONHYM shall study the domestic and foreign markets for such gas. 
		

		
			 
		

		
			
		

		
			

		 

		

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			ARTICLE 6 ‐ MARKET PRICE
		

		
			 
		

		
			6.1       The Parties accept that the Market Price used to calculate the royalty in cash that is payable under Article 11 and the corporate tax will be calculated under section 46 of the Hydrocarbon Law. 
		

		
			 
		

		
			6.2       The Market Price for Crude Oil provided in Article 6.1 above shall be a fair market price which would be achieved by CONTRACTOR GROUP at the Crude Oil Delivery Point for FOB sales on normal international market terms, in a freely convertible currency, not involving barter or other remuneration, for a cargo of Crude Oil from the Exploitation Concession for the relevant loading date range in question, taking into account sales of Crude Oil from the Exploitation Concession and sales of similar grades of crude oil, due allowance being made for quality, location, dates and all relevant factors.
		

		
			 
		

		
			6.3        If the STATE and CONTRACTOR GROUP fail to agree on Market Price for any Crude Oil for any calendar month by at least fifteen (15) days after the end of that calendar month, either the STATE or CONTRACTOR GROUP may, providing notice has been provided to the other Party, promptly submit the matter to a single arbitrator designated by the International Chamber of Commerce (I.C.C.) to determine the price per Barrel which, in the arbitrator's opinion, best represents for the pertinent calendar month the Market Price of that Crude Oil. The arbitrator's decision shall be issued within thirty (30) days from the date of his appointment and shall be final and binding on the Parties.
		

		
			 
		

		
			6.4       The Market Price for Natural Gas shall be the actual price obtained by the Parties pursuant to a long-term Natural Gas sale agreement.
		

		
			 
		

		
			
		

		
			

		 

		

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			PART IV – THE PARTIES’ OBLIGATIONS
		

		
			 
		

		
			 
		

		
			 
		

		
			
		

		
			

		 

		

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			ARTICLE 7 ‐ APPLICABLE LAW
		

		
			 
		

		
			7.1       Exploration Works and Development and Exploitation Works in the Area of Interest shall be performed in accordance with the provisions of this      Agreement until its expiry, in accordance with the Hydrocarbon Code, and the laws and regulations of Morocco which are in effect at the date of its signing. 
		

		
			 
		

		
			7.2       This Agreement shall be governed and interpreted in accordance with Moroccan laws.  Without prejudice to the foregoing, the principles and customs of the international petroleum industry may be applied in the interpretation of this Agreement. 
		

		
			 
		

		
			
		

		
			

		 

		

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			ARTICLE 8 – SUPERVISION AND ASSISTANCE
		

		
			 
		

		
			 
		

		
			8.1      The Parties, in accordance with the provisions of the Hydrocarbon Code, are subject to the provisions concerning the supervision by the administration of their activities relating to Hydrocarbons Exploration Works and Development and Exploitation Works.
		

		
			 
		

		
			8.2      ONHYM shall provide all necessary and appropriate assistance for the obtaining of any authorizations and approvals necessary for the performance of the obligations stemming from the Exploration Permits and from the present Agreement. 
		

		
			 
		

		
			8.3      ONHYM shall give all necessary assistance to the Parties applying for an Exploitation Concession, to obtain any authorisations or approvals required for the construction of facilities and pipelines to exploit the Hydrocarbon discovery within the Exploitation Concession, as well as for the construction of such facilities necessary for Development Works located outside the boundaries of the Exploitation Concession but within the jurisdiction of Morocco.
		

		
			 
		

		
			
		

		
			

		 

		

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			ARTICLE 9 – PROFESSIONAL TRAINING
		

		
			 
		

		
			 
		

		
			9.1        As of the Effective Date of this Agreement, CONTRACTOR GROUP shall contribute to the training of staff and technicians from the national oil industry an amount of one hundred fifty thousand U.S. Dollars ($ U.S. 150,000) for each twelve (12) month period during the term of validity of the Exploration Permits and the first Exploitation Concession deriving from the Exploration Permits. CONTRACTOR GROUP shall contribute a further thirty thousand U.S. Dollars ($ U.S. 30,000) for each twelve (12) month period for each additional Exploitation Concession up to a maximum aggregate amount of two hundred fifty thousand U.S. Dollars ($ U.S. 250,000) for each twelve (12) month period.
		

		
			 
		

		
			9.2        The training programs and any associated costs shall be established by agreement between ONHYM and CONTRACTOR GROUP. The training programs as well as the mode and payment schedule for such contributions will be established by agreement between the Parties, and shall include the costs of any training organized by CONTRACTOR GROUP which is taken by staff and technicians from the national oil industry.
		

		
			 
		

		
			9.3        If KOSMOS and/or CAPRICORN should withdraw from the present Agreement, the withdrawing Party(ies) must fulfill, or cause to be fulfilled, any then current training obligation, but will not be required to contribute to training programs other than to the then current training program. It is moreover understood that any cumulative remaining amount from annual training budgets will be paid by the Operator to ONHYM upon the written request of ONHYM and pursuant to such written request. After the completion of the then current training program, and/or after the payment of said cumulative remaining amount to ONHYM, ONHYM shall release any residual amount of the Guarantee, provided that the Operator has furnished ONHYM with all data and documentation relating to the Exploration Works carried out in the Area of Interest, as described in Article 4.2.6 above. 
		

		
			 
		

		
			9.4        All training expenses incurred by CONTRACTOR GROUP during the term of validity of the Exploration Permits and the Exploitation Concession(s) held jointly with ONHYM in the context of this Agreement shall be considered as exploration or exploitation costs, as the case may be, in the Area of Interest, for the purposes of section 47 of the Hydrocarbon Law.
		

		
			 
		

		
			
		

		
			

		 

		

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			ARTICLE 10 –SAFETY AND ENVIRONMENT
		

		
			 
		

		
			10.1     The Parties shall conduct all of the Exploration Works and the Development and Exploitation Works according to the rules of safety and of protection of the environment, in accordance with section 38 of the Hydrocarbon Law and sections 32 and 33 of the Decree. 
		

		
			 
		

		
			10.2     Except for any possible damage which may have been caused by operations exclusively conducted by CONTRACTOR GROUP during the term of validity of the Area of Interest covered by the exploration permits Cap Boujdour Offshore I through XV which expired on March 5, 2016, ONHYM shall guarantee and hold harmless CONTRACTOR GROUP from and against all claims for loss or damage arising as a consequence of the operations conducted within the Area of Interest prior to the Effective Date of this Agreement.
		

		
			 
		

		
			
		

		
			

		 

		

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			PART V – FISCAL PROVISIONS
		

		
			 
		

		
			 
		

		
			 
		

		
			
		

		
			

		 

		

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			ARTICLE 11 – ANNUAL ROYALTY
		

		
			 
		

		
			11.1     Annual royalty rate
		

		
			 
		

		
			Each Party shall pay to the State an annual royalty on the value of its Participating Interest in the Net Share of Hydrocarbons Production according to the following basis:
		

		
			 
		

		
			CRUDE OIL
		

		
			 
		

		
			     For any Exploitation Concession with a water depth less than or equal to 200 meters:
		

		
			 
		

		
			The first 300,000 tons produced in each Exploitation Concession are exempted from the annual royalty payment;
		

		
			 
		

		
			All production exceeding 300,000 tons in each Exploitation Concession is subject to an annual royalty charge of 10%.
		

		
			 
		

		
			     For any Exploitation Concession with a water depth greater than 200 meters:
		

		
			 
		

		
			The first 500,000 tons produced in each Exploitation Concession are exempted from the annual royalty payment;
		

		
			 
		

		
			All production exceeding 500,000 tons in each Exploitation Concession is subject to the annual royalty charge of 7%.
		

		
			 
		

		
			NATURAL GAS
		

		
			 
		

		
			     For any Exploitation Concession with a water depth less than or equal to 200 meters:
		

		
			 
		

		
			The first 300 million m3 produced in each Exploitation Concession are exempted from the annual royalty payment;
		

		
			 
		

		
			All production exceeding 300 million m3 in each Exploitation Concession is subject to an annual royalty charge of 5%.
		

		
			 
		

		
			     For any Exploitation Concession with a water depth greater than 200 meters:
		

		
			 
		

		
			The first 500 million m3 produced in an Exploitation Concession are exempted from the annual royalty payment;
		

		
			 
		

		
			All production exceeding 500 million m3 in each Exploitation Concession is subject to the annual royalty charge of 3.5%. 
		

		
			 
		

		
			11.2     Methods of payment of the annual royalty
		

		
			
		

		
			

		 

		

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			The STATE reserves the right to be paid in kind or in cash. Any decision by the STATE to modify its choice of payment method must be communicated to each of the Parties in writing at least six (6) calendar months prior to the effective date of such a change.
		

		
			 
		

		
			11.2.1 The Crude Oil and/or Natural Gas prices which shall be used to determine the amount of the advances of the annual royalty as specified in Article 11.2.2 below, if payable in cash, shall be based on the Market Price applicable during the calendar month to which such advances relate as defined in Article 6 herein.
		

		
			 
		

		
			11.2.2 If the STATE elects to be paid in cash, then on or before 31 July and 31 January of each calendar year, each of the Parties shall pay the STATE advances on the annual royalty for that amount of Net Hydrocarbon Production produced during the immediately preceding semesters, ending 30 June and 31 December of the calendar year in question, provided that Hydrocarbons were produced in the Exploitation Concession during the applicable semester.  The amount of the semestrial advance shall be estimated by each of the Parties on the basis of the production and by using the Market Price referred to in Article 11.2.1 of this Agreement.
		

		
			 
		

		
			11.2.3 Within ninety (90) days following the end of each calendar year, each Party shall submit to the STATE the final annual royalty declaration and shall then settle the difference between the actual amounts due and the estimated semestrial payments made for the calendar year in question.  If the estimated semestrial payments are greater than the final amount due, the difference shall be deferred as a credit against the annual royalty for the next calendar year.  
		

		
			
		

		
			

		 

		

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			ARTICLE 12 –CORPORATE TAX 
		

		
			 
		

		
			 
		

		
			12.1.    In accordance with Article 5 of the Code Général des Impôts instituted by finance law n° 43-06 for the 2007 financial year, promulgated by dahir n° 1-06-232 of 10 Hijja 1427 (31 December 2006), as amended and completed (“Code Général des Impôts”),   and in accordance with Sections 46, 47, 48 and 49 of the Law, each of the Parties shall calculate and pay the STATE the corporate income tax, utilizing the Market Prices determined pursuant to Article 6.
		

		
			 
		

		
			12.2.    In accordance with Article 6-II-B-2° of the Code Général des Impôts,  each of the Parties shall benefit from a total exemption from the Corporate Income Tax for a period of ten (10) consecutive years for each Exploitation Concession starting from the date of commencement of regular production from such Exploitation Concession.
		

		
			 
		

		
			
		

		
			

		 

		

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			ARTICLE 13 - CUSTOMS
		

		
			 
		

		
			Each of the Parties, their contractors and sub-contractors shall benefit from the customs regime specified in Sections 50, 51 and 52 of the Hydrocarbon Code.
		

		
			
		

		
			

		 

		

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			ARTICLE 14 - FOREIGN EXCHANGE AND OTHER FISCAL PROVISIONS
		

		
			 
		

		
			 
		

		
			14.1     In accordance with article 6-I-C-1 of the Code Général des Impôts, and with the provisions of Sections 53 to 58, 60 and 62 of the Hydrocarbon Law, each of the Parties, when appropriate, shall benefit from measures relating to the foreign exchange regime, and the withholding at source on proceeds from shares, capital stock and similar revenues.
		

		
			 
		

		
			14.2     In accordance with section 6-I-A-31° of the law n°47-06 dated 30 November 2007 relating to local taxation, each of the Parties shall benefit from the total exemption of the business tax, and in accordance with the provisions of section 41-3° of the law n°47-06, the Parties are exempted from the un-built urban areas tax.
		

		
			 
		

		
			14.3     In accordance with the provisions of articles 92-I-40° and 123-41° of the Code Général des Impôts and the provisions of Section 61 of the Hydrocarbon Law, each of the Parties, their contractors and sub-contractors shall benefit from exemption from the value-added tax on goods and services acquired in the local market or imported from abroad.
		

		
			 
		

		
			14.4     Withholding tax will apply to payments for services provided by all foreign companies in accordance with the provisions of articles 4-III, 15, 19-IV-B and 160 of the Code Général des Impôts, and in accordance with any conventions with a view to avoiding double taxation on such foreign company.
		

		
			 
		

		
			14.5     CONTRACTOR GROUP shall pay the application fees for the grant and extensions of the Exploration Permits.
		

		
			 
		

		
			14.6     Each of the Parties shall pay its proportional share of the annual surface rental of one thousand Dirham (1,000 DH) per square kilometer on all Exploitation Concession(s).
		

		
			 
		

		
			
		

		
			

		 

		

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			ARTICLE 15 – BONUSES
		

		
			 
		

		
			15.1     CONTRACTOR GROUP undertakes to pay the STATE, for each discovery declared a Commercial Discovery by the Parties pursuant to Article 5.8.4 of the Association Contract, a discovery bonus of an amount of one million U.S. Dollars ($ U.S. 1,000,000) in accordance with the following terms: 
		

		
			 
		

		
			     five hundred thousand U.S.  Dollars ($ U.S. 500,000) is to be paid within thirty (30) days of the declaration of the Commercial Discovery;
		

		
			 
		

		
			     the remaining amount of five hundred thousand U.S. Dollars ($ U.S. 500,000) is to be paid:
		

		
			 
		

		
			     When the discovery is a Commercial Discovery of Crude Oil, within thirty (30) days of the conclusion of the first sale contract of production from such Commercial Discovery;
		

		
			 
		

		
			     When the discovery is a Commercial Discovery of Natural Gas, within thirty (30) days of the first delivery to the purchaser of Natural Gas produced from such Commercial Discovery.
		

		
			 
		

		
			15.2     In addition, CONTRACTOR GROUP shall pay the STATE the corresponding bonuses payable within thirty (30) days of the end of the month in which the following cumulative levels of its share of production from all Exploitation Concessions are first reached and maintained for thirty (30) consecutive days:
		

		
			 
		

		
			Fifty thousand (50,000) BOE per day: a payment of one million U.S. Dollars ($ U.S. 1,000,000);
		

		
			 
		

		
			One hundred thousand (100,000) BOE per day: a payment of two million U.S. Dollars ($ U.S. 2,000,000);
		

		
			 
		

		
			Two hundred thousand (200,000) BOE per day: a payment of three million U.S. Dollars ($ U.S. 3,000,000).
		

		
			 
		

		
			Three hundred thousand (300,000) BOE per day: a payment of four million U.S. Dollars ($ U.S. 4,000,000).
		

		
			 
		

		
			For the purposes of this Article 15, the quantities of Hydrocarbons used within the perimeter of the Exploitation Concession for the purposes of the direct or assisted exploitation of the deposit shall not be taken into consideration for the calculation of the above bonuses.
		

		
			 
		

		
			For the purposes of this Agreement, BOE, means 5,800 standard cubic feet of Natural Gas per standard barrel at fifteen (15) degrees Celsius and one thousand and thirteen point two five (1,013.25) mbar.  
		

		
			
		

		
			

		 

		

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			15.3     All the bonuses paid in accordance with Articles 15.1 and 15.2 by CONTRACTOR GROUP when a Commercial Discovery has been declared and during the term of validity of any Exploitation Concession held jointly with ONHYM under this Agreement shall be considered as exploration and/or exploitation costs deductible for the purposes of section 47 of the Hydrocarbon Law.
		

		
			 
		

		
			
		

		
			

		 

		

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			PART VI – MISCELLANEOUS PROVISIONS
		

		
			 
		

		
			 
		

		
			 
		

		
			
		

		
			

		 

		

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			ARTICLE 16 ‐ ASSOCIATION CONTRACT
		

		
			 
		

		
			16.1     Simultaneously with the signing of this Petroleum Agreement, the Parties as applicants for the Exploration Permits shall sign an Association Contract in order to: 
		

		
			 
		

		
			16.1.1  set out the appropriate procedures to enable the Parties to jointly and successfully perform the Exploration Works and the Development and Exploitation Works relating to the Area of Interest as specified in this Petroleum Agreement.
		

		
			 
		

		
			16.1.2  set out the necessary procedures to secure the sound conduct of Joint Operations and Sole Risk Operations as the case may be, and to manage the relationships between the Parties.
		

		
			 
		

		
			16.1.3  define and set out the rights, benefits, obligations and liabilities of each Party in accordance with their Participating Interests under the Association Contract and as defined thereunder.
		

		
			 
		

		
			
		

		
			

		 

		

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			ARTICLE 17 ‐ THE OPERATOR
		

		
			 
		

		
			17.1    KOSMOS is hereby designated as Operator for the conduct of all the operations and activities in respect of the Exploration Permits and the Exploitation Concession(s) which will derive from the said Exploration Permits, until the creation of a Joint Operating Company or until such time as it ceases to be Operator in accordance with the provisions of the Association Contract.
		

		
			 
		

		
			17.2    The rights and duties of the Operator are detailed in the Association Contract. The Operator shall, unless otherwise agreed by the Parties or provided herein, give notice on behalf of the Parties to the STATE under this Agreement and represent the Parties in discussions with the STATE or any other Moroccan authorities, in accordance with the provisions of the Association Contract.
		

		
			 
		

		
			
		

		
			

		 

		

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			ARTICLE 18 ‐ CONFIDENTIALITY
		

		
			 
		

		
			18.1     Subject to the provisions of this Agreement, each of the Parties agrees that all information and data acquired or obtained by any Party in respect of Joint Operations shall be considered confidential and each of the Parties shall keep confidential and not disclose any information or data acquired or obtained in respect of Joint Operations during the term of the Agreement to any person or entity not a party to this Agreement, except: 
		

		
			 
		

		
			i)           To the Ministry in charge of energy;
		

		
			 
		

		
			ii)          to a Subsidiary, provided such Subsidiary maintains confidentiality as provided in this Article 18; 
		

		
			 
		

		
			iii)         to any other governmental entity as required by this Agreement;
		

		
			 
		

		
			iv)         to the extent that such information and data is required to be provided in accordance with any applicable laws or regulations, or pursuant to any legal proceedings or as a result of an order of any court binding upon a Party; 
		

		
			 
		

		
			v)          to any contractor, business, consultant or attorney whether prospective or actual, employed by any Party where disclosure of such information or data is essential to the proper performance of such contractor, business, consultant or attorney's work; 
		

		
			 
		

		
			vi)         to a prospective bona fide transferee of a Party's Participating Interest (including an entity with whom a Party or its Subsidiaries are conducting bona fide negotiations directed toward a merger, consolidation or sale of a majority of its or a Subsidiary's shares); 
		

		
			 
		

		
			vii)        to a bank or other financial institution or to an insurance company, to the extent necessary for a Party to arrange for funding; or insurance coverage;
		

		
			 
		

		
			viii)       to the extent such data and information must be disclosed pursuant to any rules or requirements of any government or stock exchange having jurisdiction over such Party, or its Subsidiaries;
		

		
			 
		

		
			ix)         to its respective employees for the purposes of Joint Operations, subject to each Party taking usual precautions to ensure that such data and information remains confidential;  
		

		
			 
		

		
			x)          any data or information which, through no fault of a Party, becomes a part of the public domain; and
		

		
			 
		

		
			xi)         any data or information which the Parties have agreed to release into the public domain.  
		

		
			 
		

		
			Any disclosure as pursuant to Article18.1 (i), (iv), (v), and (vi) shall not be made unless, prior to such disclosure, the disclosing Party has obtained a written undertaking from the recipient to keep
		

		
			
		

		
			

		 

		

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			the data and information strictly confidential for at least three (3) years after the termination of this Agreement.
		

		
			 
		

		
			18.2     Continuing Obligations
		

		
			Any Party constituting CONTRACTOR GROUP, ceasing to be a Party to this Agreement, shall nonetheless remain bound by the confidentiality obligations set out in Article 18.1 and any dispute shall be resolved in accordance with Article 20.
		

		
			 
		

		
			18.3      Data trades
		

		
			Notwithstanding the foregoing provisions of this Article 18, Operator may make data trades including in respect of data on the wells, for the benefit of the Parties, any data obtained in this way being provided to all Parties who participated in the cost of the data that was traded.  Operator shall ensure that any third party to such trade shall sign a commitment to keep the traded data confidential.
		

		
			 
		

		
			18.4      Public Announcements
		

		
			If any Party wishes to issue or make any new public announcement or statement regarding this Agreement and/or the Association Contract it is imperative that it shall not do so unless, prior thereto, it provides all the Parties with a copy of such announcement or statement and obtains the written approval of the other Parties. Notwithstanding any failure to obtain such approval by all Parties, after three (3) business days from the date at which such announcement or statement was received by the Parties, such Party may issue or make any such public announcement or statement if it is absolutely necessary to do so in order to comply with an applicable law, the regulations of a recognized stock exchange, the Securities Exchange Commission of the United States of America, or any oversight body governing such Party.
		

		
			 
		

		
			Notwithstanding the above, the Parties agree that if it is absolutely necessary to make an announcement or public statement prior to the expiration of the three (3) business days noted in the above paragraph, with this being so in order to comply with an applicable law, the regulations of a recognized stock exchange, the Securities Exchange Commission of the United States of America, or any oversight body governing KOSMOS and/or CAPRICORN, KOSMOS and/or CAPRICORN, as the case may be, shall simultaneously notify and send the information to be published to ONHYM and to the entity to whom the information is transmitted.
		

		
			 
		

		
			Any disputes which may arise as a result of any Party failing to comply with its confidentiality obligations regarding public announcements shall be resolved in accordance with Article 20. 
		

		
			 
		

		
			
		

		
			

		 

		

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			ARTICLE 19 ‐ FORCE MAJEURE
		

		
			 
		

		
			19.1     The non-performance by one of the Parties of any one of its obligations, with the exception of non‐payment of any of the due amounts, shall be excused to the extent that any such non‐performance results from a Force Majeure event. Force Majeure shall be interpreted as meaning any event which is normally beyond the control of the Party, because that Party is not in a position to either prevent it or overcome it by exercising reasonable diligence and by incurring reasonable expenses as measured by oil industry standards. 
		

		
			 
		

		
			19.2     The Party that deems itself unable to fulfill its obligations by reason of Force Majeure event, shall advise the other Parties thereof in writing as soon as possible. The Parties shall consider what steps should be taken to ensure a return to a position in which the provisions of this Agreement can be carried out. 
		

		
			 
		

		
			19.3     During any time period in which operations cannot be performed due to a Force Majeure event, the works set out in the Minimum Exploration Work Program or production activities, as the case may be, shall be postponed and will only recommence after the period of Force Majeure has ended. 
		

		
			 
		

		
			19.4     Once the period of Force Majeure has ended, the validity period of the Exploration Permits and Exploitation Concessions will resume as if no Force Majeure event had occurred, provided however that the term of such validity period shall be extended by a period equal to the period of the Force Majeure.
		

		
			 
		

		
			
		

		
			

		 

		

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			ARTICLE 20 – ARBITRATION
		

		
			 
		

		
			20.1   If any dispute arises out of or in connection with this Agreement, the Parties shall use all reasonable endeavours to come to an amicable and equitable settlement. If such settlement cannot be reached within the ninety  (90) days following the date upon which one of the Parties has notified the other, the Parties shall refer the matter to arbitration as defined below.
		

		
			 
		

		
			20.2   With the exception of disputes relating to the determination of the Market Price, which shall be settled in accordance with Article 6, all disputes, including the failure to restore an economic stability in accordance with Article 21, arising out of or in connection with this Agreement and which have not been amicably resolved as provided in Article 20.1, shall be definitively settled by arbitration before the International Centre for the Settlement of Investment Disputes (ICSID). If, for whatever reason, the dispute does not fall within the jurisdiction of ICSID, it shall then be submitted to arbitration under the Rules for Arbitration of the International Chamber of Commerce (ICC).
		

		
			 
		

		
			20.3   The arbitration tribunal shall be composed of three (3) arbitrators, one to be appointed by CONTRACTOR GROUP and one by  ONHYM and the third arbitrator, who shall chair the arbitration tribunal, appointed by agreement between the first two arbitrators. If there is any difficulty in appointing an arbitrator, such arbitrator shall be appointed by the President of the Administrative Council of ICSID (or, if the arbitration is being conducted under the rules of ICC, by the President of the ICC Arbitration Court) on the application of any Party. The arbitration tribunal shall apply Moroccan law as in force on the date of this Agreement and generally accepted practice in the petroleum industry. 
		

		
			 
		

		
			20.4   Any arbitration proceeding shall take place in Paris (France) and shall be conducted in the French language.
		

		
			 
		

		
			20.5   It is agreed that recourse to arbitration shall be made directly by one Party by notice to ICSID (or ICC) with a copy to the other Parties, without the necessity to pursue administrative or legal proceedings. The Parties expressly agree that the arbitrational judgment shall be final and binding and that it may be recognised or enforced by any court of competent jurisdiction, in accordance with Article 54 of the ICSID Convention or the ICC Rules as the case may be.
		

		
			 
		

		
			20.6   The Parties hereby irrevocably and unequivocally undertake to comply with any award rendered by an arbitration tribunal constituted pursuant to this Agreement. 
		

		
			 
		

		
			20.7   Each Party shall bear all costs and expenses incurred by it relating to the arbitration but the costs of the arbitration tribunal shall be borne by the Party against which a judgment is awarded.
		

		
			
		

		
			

		 

		

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			ARTICLE 21 – ECONOMIC STABILITY OF CONTRACTOR GROUP
		

		
			 
		

		
			21.1     The terms and conditions of this Petroleum Agreement are agreed on the basis of the legislation and regulations of the Kingdom of Morocco in force at the date of signature and it is on this basis that CONTRACTOR GROUP is making its investments.  
		

		
			 
		

		
			21.2     In the event that a change in the applicable law would affect the economic and financial conditions of CONTRACTOR GROUP with regard to this Agreement existing at the Effective Date, following notice from the Operator, ONHYM shall, within ninety (90) days of the date when such change will take effect, make every effort to preserve or re‐establish the economic and financial conditions which existed for CONTRACTOR GROUP at the Effective Date and shall, in particular, propose amendments to this Agreement and/or negotiate in all good faith the proposals which may be subsequently made in this context by CONTRACTOR GROUP. Any decision will take account of the effects of any changes since the date of application.  
		

		
			 
		

		
			
		

		
			

		 

		

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			ARTICLE 22 ‐  ASSIGNMENT AND TRANSFER OF RIGHTS AND OBLIGATIONS
		

		
			 
		

		
			 
		

		
			22.1     Subject to Article 22.2, the Parties shall have the right to assign all or part of their Participating Interest in the Exploration Permits and/or any Exploitation Concession under this Petroleum Agreement in accordance with the Hydrocarbon Code.  In the event any Party comprising the CONTRACTOR GROUP desires to farmout a portion of its Participating Interests in Exploration Permits and/or any Exploitation Concession under this Petroleum Agreement, such Party and ONHYM will collaborate in the farmout process undertaken by such Party.  ONHYM will participate in the preparation of the corresponding promotional material and will also be involved in the roadshow and in marketing meetings to prospective assignees.  Furthermore, such Party must obtain approval from the Minister in charge of Energy and ONHYM pertaining to the prospective assignee before any assignment is effective.
		

		
			 
		

		
			If such a transfer takes place, the Parties shall enter into an amendment to this Agreement to recognize the new Percentage Interests and the corresponding commitments.
		

		
			 
		

		
			22.2     During the period of validity of the Exploration Permits, ONHYM will not assign its rights hereunder except for an assignment to CONTRACTOR GROUP or if the Moroccan State nominates another entity to hold such rights on the STATE's behalf.  Any such entity shall be subject to a similar restriction on assignment of the rights it acquires hereunder.
		

		
			 
		

		
			22.3     In the event of an assignment between a CONTRACTOR GROUP Party and its Subsidiaries, such assignment shall be carried out in accordance with the Hydrocarbon Code. 
		

		
			 
		

		
			22.4     In the event that there is an assignment to a third party, such assignment shall require the prior approval of the Minister in charge of Energy in accordance with the Hydrocarbon Code, before it can be effective. Notwithstanding the foregoing and for the avoidance of doubt, the Parties agree and acknowledge that any surety, mortgage, charge, lien, hypothecation or encumbrance, by way of security of its participating interest under the Exploration Permits will require only notification to the Minister in charge of Energy.  
		

		
			 
		

		
			
		

		
			

		 

		

			41

		

 

		

		
			ARTICLE 23 – NOTICES
		

		
			 
		

		
			All notices which must, or may, be given in accordance with the Hydrocarbon Code and this Agreement, shall be made in writing in English, and in French where such notice is required to be sent to the Minister in charge of Energy or any other ministerial department and delivered in person or by registered post or by courier post or electronic means of transmitting written communications with confirmation of receipt, and addressed to the Parties noted below. Oral communication shall not constitute notice for the purposes of this Agreement. Initial notice given pursuant to the provisions of this Agreement shall be deemed delivered only when received by the Party to whom such notice is addressed, and the timeframe for such Party to deliver any notice in response to such initial notice shall run from the date on which the initial notice is received. A second notice or a notice by way of response shall be deemed delivered when received. For the purposes of this Article, the term "received" in respect of a written notice delivered pursuant to this Agreement shall mean the actual delivery of the notice to the address of the Party to be notified, specified in accordance with this Article. Each Party shall have the right to change its address at any time and/or designate that copies of all such notices be directed to another person at another address by giving written notice to all other Parties.
		

		
			 
		

		
			These notices shall be addressed to:
		

		
			 
		

			
					
						To:

					
					
						Ministry of Energy, Mines, Water and Environment

				
	
					
						Attention:

					
					
						Monsieur Le Ministre

				
	
					
						 

					
					
						B.P. 6208 – Rabat Instituts

				
	
					
						 

					
					
						Haut Agdal Rabat – MAROC

				
	
					
						Fax:

					
					
						(212) 05 37 77 47 32

				
	
					
						 

					
					
						 

				
	
					
						To:

					
					
						 

				
	
					
						 

					
					
						The OFFICE NATIONAL DES HYDROCARURES ET DES MINES (ONHYM)

				
	
					
						 

					
					
						5, Avenue Moulay Hassan

				
	
					
						 

					
					
						B.P. 99 Rabat MAROC

				
	
					
						Attention:

					
					
						Le Directeur Général

				
	
					
						Fax:

					
					
						(212) 05 37 28 16 34/26

				
	
					
						 

					
					
						 

				
	
					
						To:

					
					
						KOSMOS ENERGY MAROC MER PROFONDE

				
	
					
						 

					
					
						4th Floor, Century Yard

				
	
					
						 

					
					
						Cricket Square, Hutchins Drive

				
	
					
						 

					
					
						Elgin Avenue, George Town

				
	
					
						 

					
					
						Grand Cayman KY1-1209

				
	
					
						 

					
					
						Cayman Islands

				
	
					
						Attention :

					
					
						General Counsel

				
	
					
						 

					
					
						 

				
	
					
						Fax:

					
					
						+1-345-527-2105

				
	
					
						 

					
					
						 

				
	
					
						Copy to:

					
					
						KOSMOS ENERGY MAROC MER PROFONDE

				
	
					
						 

					
					
						c/o Kosmos Energy, LLC

				

		
			 
		

		
			
		

		

		 

		

			42

		

 

	
					
						

					
						 

					
					
						8176 Park Lane, Suite 500

				
	
					
						 

					
					
						Dallas, Texas USA 75231

				
	
					
						Attention:

					
					
						General Counsel

				
	
					
						Fax:

					
					
						+1-214-445-9705

				
	
					
						Email:

					
					
						KosmosGeneralCounsel@kosmosenergy.com

				
	
					
						 

					
					
						MoroccoLicenseManager@kosmosenergy.com

				
	
					
						 

					
					
						 

				
	
					
						To:

					
					
						CAPRICORN EXPLORATION AND DEVELOPMENT COMPANY LIMITED

				
	
					
						 

					
					
						50 Lothian Road

				
	
					
						 

					
					
						Edinburgh EH3 9BY

				
	
					
						 

					
					
						United Kingdom

				
	
					
						Attention:

					
					
						Head of Legal

				
	
					
						Fax:

					
					
						+44(0) 131 475 3030

				
	
					
						Email:

					
					
						Duncan.Holland@cairnenergy.com

				

		
			 
		

		
			For the purposes of this Agreement, if any Party changes its above notification address, it shall advise the other Parties in writing within ten (10) days of such a change.
		

		
			
		

		
			

		 

		

			43

		

 

		

		
			ARTICLE 24 – OTHER PROVISIONS
		

		
			 
		

		
			24.1     Any correspondence and administrative documents to be provided in accordance with the Hydrocarbon Code and this Agreement, shall be in the French language, whilst data and technical documents may be provided in the French language or the English language.
		

		
			 
		

		
			24.2     If any of the Parties fails to enforce any of the provisions of this Agreement or to exercise its rights and privileges arising by virtue of the Hydrocarbon Code and/or of this Agreement, it may at any time require the enforcement of such provisions, rights and privileges. 
		

		
			 
		

		
			24.3     The Parties' respective successors shall be bound by and benefit from this Agreement. 
		

		
			 
		

		
			24.4     This Agreement has been drawn up in French and translated into English. It has been signed in these two versions.  In the event of a dispute only the French version shall prevail. 
		

		
			 
		

		
			24.5     No provision of this Agreement can be amended or modified except by mutual agreement in writing signed by the Parties. These amendments or modifications shall be approved and shall be effective on the date of signature of a joint order issued by the Minister in charge of Energy and the Minister in charge of Finance pursuant to the Hydrocarbon Code, such approval not to be unreasonably withheld. ONHYM shall assist CONTRACTOR GROUP in the procedure of procuring such approval. 
		

		
			 
		

		
			24.6     The provisions of the Hydrocarbon Code relating to the Effective Date of this Agreement shall be applicable to all cases or situations not specified in this Petroleum Agreement relating to the exploration and exploitation of Hydrocarbons in the Area of Interest. 
		

		
			 
		

		
			24.7     In the event of any conflict between the provisions of this Petroleum Agreement and the Hydrocarbon Code, the provisions of the Hydrocarbon Code shall prevail. In the event of conflict between the provisions of this Agreement and the Association Contract, the provisions of this Agreement shall prevail. 
		

		
			 
		

		
			24.8     Subject to agreement on the terms of a suitable work program, ONHYM undertakes to participate with CONTRACTOR GROUP in an application for the award of any exploration permit, under a new petroleum agreement, for any area adjacent to the Exploration Permits and not the subject of an existing exploration permit. 
		

		
			 
		

		
			24.9     ONHYM undertakes to participate, in accordance with the provisions of section 30 of the Hydrocarbon Law, with CONTRACTOR GROUP, in an application for the award of any exploitation concession for any area adjacent to the Exploration Permits which is not the subject of an existing exploitation concession or exploration permit. 
		

		
			 
		

		
			24.10   The Parties reaffirm their commitment to the Joint Declaration of Principles signed by ONHYM and KOSMOS on 19 December 2013, which is made an Appendix to this Agreement.
		

		
			
		

		
			

		 

		

			44

		

 

		

		
			ARTICLE 25 – EFFECTIVE DATE
		

		
			 
		

		
			25.1     As provided in section 60 of the Decree, implementing section 34 of the Hydrocarbon Code, this Petroleum Agreement shall be approved by a joint order from the Minister in charge of Energy and from the Minister in charge of Finance.
		

		
			 
		

		
			25.2     This Petroleum Agreement will enter into effect on the date ("Effective Date") of the signature of the aforesaid joint order and will remain effective until expiry in accordance with the provisions of Article 2 of this Agreement.
		

		
			 
		

		
			
		

		
			

		 

		

			45

		

 

		

		
			IN WITNESS WHEREOF, THIS AGREEMENT IS EXECUTED IN FIVE (5) ORIGINAL COPIES IN THE FRENCH LANGUAGE AND THREE (3) CONFORMING TRANSLATIONS INTO THE ENGLISH LANGUAGE.
		

		
			 
		

		
			IN RABAT ON THIS DAY OF 25 May 2016.
		

		
			 
		

		
			 
		

		
			 
		

		
			OFFICE NATIONAL DES HYDROCARURES ET DES MINES, 
		

		
			ACTING ON BEHALF OF THE KINGDOM OF MOROCCO
		

		
			 
		

		
			 
		

			
					
						By

					
					
						/s/ Amina Benkhadra

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						Name:

					
					
						Amina BENKHADRA

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						Title:

					
					
						GENERAL DIRECTOR

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						KOSMOS ENERGY MAROC MER PROFONDE

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						By

					
					
						/s/ William Hayes

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						Name:

					
					
						William HAYES

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						Title:

					
					
						ATTORNEY IN FACT

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						CAPRICORN EXPLORATION AND DEVELOPMENT COMPANY LIMITED

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						By

					
					
						/s/ Simon Thomson

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						Name:

					
					
						Simon THOMSON

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						Title:

					
					
						Director

					
					
						 

				

		
			 
		

		
			
		

		
			

		 

		

			46

		

 

		

		
			 
		

		
			 
		

		
			 
		

		
			APPENDIX I – DEFINITIONS
		

		
			 
		

		
			 
		

		
			 
		

		
			
		

		
			

		 

		

			47

		

 

		

		
			APPENDIX I ‐ DEFINITIONS
		

		
			 
		

		
			The following words, terms and phrases shall have the meaning attributed thereto below when used in the Petroleum Agreement:
		

		
			 
		

		
			1)         “Petroleum Agreement” or the “Agreement” means the agreement to which this Appendix I is attached;
		

		
			 
		

		
			2)        “Code Général des Impôts” means the general tax code instituted by Finance Law No. 43-06 for budget year 2007, promulgated by the Dahir 1-06-232 of 10 Hijja 1427 (31 December 2006), as modified and completed;
		

		
			 
		

		
			3)       “Exploitation Concession” means any Exploitation Concession granted to CONTRACTOR GROUP and to ONHYM, pursuant to the Hydrocarbon Code and to this Agreement and deriving from the Exploration Permits;
		

		
			 
		

		
			4)       "Association Contract" means the document referred to in Article 16.1 of the Agreement; 
		

		
			 
		

		
			5)       "CONTRACTOR GROUP" means KOSMOS and CAPRICORN and any of their successors or assigns.
		

		
			 
		

		
			6)       “Effective Date” as defined in Article 25 of this Agreement;
		

		
			 
		

		
			7)           “Subsidiary" means, with regard to any Party, other than ONHYM, any entity controlling or controlled by said Party, or any entity which controls or is controlled by another entity which controls that Party directly.  It is understood that the concept of "control" shall mean the ownership by one entity of more than fifty percent (50%) :
		

		
			 
		

		
			a)     of voting shares if the other entity is a company 
		

		
			 
		

		
			or
		

		
			 
		

		
			b)     of the control of managerial decisions, if the other entity is not a company.
		

		
			 
		

		
			In the case of ONHYM, this definition shall include the STATE and any entity controlled by the STATE;
		

		
			 
		

		
			8)        “Natural Gas" means all gaseous Hydrocarbons obtained from oil or gas wells as well as residual gas from the separation process of liquid Hydrocarbons;
		

		
			 
		

		
			9)       “Available Natural Gas" means for all Exploitation Concessions, the Natural Gas produced inside the Area of Interest covered by each Exploitation Concession and not used for the needs of direct or assisted exploitation of the Hydrocarbon deposit and after deduction of the annual royalties paid in kind; 
		

		
			
		

		
			

		 

		

			48

		

 

		

		
			10)     “Hydrocarbons" means natural Hydrocarbons, whether liquid, gaseous, or solid, other than bituminous shale, and shall include Crude Oil and Natural Gas;
		

		
			 
		

		
			11)     “Minimum Expenditure Obligation" means the amounts set out in Article 4.2 of this Agreement for the Initial Period, the First Extension Period and the Second Extension Period, respectively; 
		

		
			 
		

		
			12)     “Operator”  means KOSMOS, appointed in accordance with Article 17;
		

		
			 
		

		
			13)     “Participating Interest” means, with respect to the Exploration Permits, the interests of the Parties defined in Article 3.1.2 of this Agreement and with respect to any Exploitation Concession, the interests of the Parties defined in Article 5.2 of this Agreement;
		

		
			 
		

		
			14)     "Net Share of Hydrocarbon Production" means for all Exploitation Concessions, the Hydrocarbons produced inside the Area of Interest covered by each Exploitation Concession and not used for purposes of direct or assisted exploitation of the Hydrocarbons; 
		

		
			 
		

		
			15)     "Initial Period" means the forty-eight (48) month period commencing on the effective date of the Exploration Permits; 
		

		
			 
		

		
			16)     "Extension Periods" means the First Extension Period and the Second Extension Period collectively referred to in Articles 4.2.2 and 4.2.3 of this Agreement;
		

		
			 
		

		
			17)     “Exploration Permits" means the Exploration Permits granted to CONTRACTOR GROUP and ONHYM pursuant to the Hydrocarbon Code and this Agreement in the Area of Interest;
		

		
			 
		

		
			18)     "Crude Oil" means all Hydrocarbons that are in liquid form in their natural state, or obtained by the condensation or separation of Natural Gas and bitumen;
		

		
			 
		

		
			19)     "Available Crude Oil" means for all Exploitation Concessions the Crude Oil produced inside the Area of Interest covered by each Exploitation Concession and not used for the needs of direct or assisted exploitation of the Hydrocarbon deposit after deduction of the annual royalties paid in kind;
		

		
			 
		

		
			20)     "Natural Gas Delivery Point" means the outlet flange of the subsea pipeline connecting the field facilities to the shore (or any other delivery point mutually agreed upon);
		

		
			 
		

		
			21)     "Crude Oil Delivery Point" means the outlet flange of the storage unit associated with the deposit operations (or any other delivery point mutually agreed upon);
		

		
			 
		

		
			22)     "First Extension Period" means the period of twenty-four (24) months referred to in Articles 3.3 and 4.2.2 of this Agreement;
		

		
			 
		

		
			23)     “Market Price" has the meaning set out in Article 6 of this Agreement;
		

		
			
		

		
			

		 

		

			49

		

 

		

		
			24)     "Minimum Exploration Work Program" means the operations set out and described in Article 4.2 of this Agreement; 
		

		
			 
		

		
			25)     "Second Extension Period" means the period of twenty-four (24) months referred to in Articles 3.3 and 4.2.3 of this Agreement;
		

		
			 
		

		
			26)     "Development and Exploitation Works" means all operations relating to any Exploitation Concession and carried out in this latter and, in particular, any Development Plan, geological and geophysical works, drilling of development wells, including the drilling of delineation wells, the production of Hydrocarbons, the installation of collection pipes and the operations necessary for the maintenance of pressure and for primary or secondary recovery;
		

		
			 
		

		
			27)     "Exploration Works" means all exploration and appraisal operations seeking to establish the existence of Hydrocarbons in commercially exploitable quantities;
		

		
			 
		

		
			28)     "Area of Interest" means the Area of Interest called "BOUJDOUR MARITIME” and described in Appendix II attached to the Petroleum Agreement and in Article 3.1.1.
		

		
			 
		

		
			Any other capitalised terms used in this Agreement which are not otherwise defined herein, shall have the meanings attributed thereto in the Association Contract, the Hydrocarbon Code and the applicable regulations.
		

		
			 
		

		
			
		

		
			

		 

		

			50

		

 

		

		
			APPENDIX II
		

		
			 
		

		
			MAP AND DESCRIPTION OF THE AREA OF INTEREST
		

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

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			68

		

 

		

		
			APPENDIX III – LIST OF DELIVERABLES
		

		
			 
		

		
			Deliverables to be remitted to ONHYM shall be in the following formats:
		

		
			 
		

		
			I.     Seismic : Acquisition and processing
		

		
			 
		

		
			I.1. 2D and 3D Seismic :
		

		
			 
		

		
			-- Field data on cartridges, 3592 or LTO-04 in an international standard format (SEG-D demultiplied) 
		

		
			-- Intermediate data such as mirror CDP
		

		
			-- Data processed on cartridge, 3592 or LTO-04 (stack and migration) SEG-Y with header information about the processed seismic data (processing sequence, navigation data or coordinates)
		

		
			-- Special processing (PSDM, AVO) on cartridge 3592 or LTO-04 in SEG-Y format with header information about the processed seismic data (processing sequence, navigation data or coordinates)
		

		
			-- Complete sequence of processing in hard copy and electronic format
		

		
			-- Velocities  analysis data
		

		
			-- Field documents (operating report of the seismic acquisition, field note-book, coordinates of the shooting points and of the receivers, data of the alteration zone (WZ), and seismic data test ) in hard copy and electronic formats
		

		
			-- Navigation data on CD (for the offshore data)
		

		
			 
		

		
			For onshore acquisition, the Projection System is : UTM
		

		
			Options for the projection: Ellipsoid: WGS84
		

		
			Format: UKOOA in ASCII or EXCEL
		

		
			 
		

		
			I.2.Seismic: Reprocessing: 
		

		
			 
		

		
			-- Data processed on cartridge, 3592 or LTO-04 (Stack and migration) SEG-Y with header information about the processed seismic data (processing sequence, navigation data or coordinates)
		

		
			-- Special processing (PSDM, AVO) on cartridge 3592 or LTO-04 in SEG-Y format with header information about the processed seismic data (processing sequence, navigation data or coordinates)
		

		
			-- Complete sequence of processing in hard copy and electronic format
		

		
			-- Velocities analysis data in ASCII format
		

		
			 
		

		
			II.     Magnetic, gravimetric, Electromagnetic, Magnetotelluric and electrical data: 
		

		
			 
		

		
			-- Raw data in an international standard format together with all the supporting documents 
		

		
			-- Processed data in an international standard format 
		

		
			- Interpretation of these data.
		

		
			
		

		
			

		 

		

			69

		

 

		

		
			III.     Drilling : 
		

		
			 
		

		
			-- Cuttings: an average of 500 grams of washed cuttings and 500 grams of non-washed cuttings from each 5 m for the interval of the reservoir ; and from each 10-20 m for the remaining of the well
		

		
			-- Cores : half of the cores cut in length 
		

		
			-- Electrical logs: data of all drilling operations in an international standard format 
		

		
			-- Check  shot Survey ,VSP  
		

		
			-- Seismic coring 
		

		
			-- data of well test (pressure, samples of received fluid, PVT analysis and water analysis)
		

		
			-- Final well report to include, in addition to the drilling evaluation report, the logs interpretation (paper and electronic format)
		

		
			-- Copy of composite log
		

		
			-- Report of the abandonment of the well(s), specifying the abandonment work realized on the well(s) drilled during the pertinent period of the Exploration Permits and for the well(s) drilled within the framework of any Exploitation Concession which are to be abandoned.
		

		
			 
		

		
			IV.     Studies : 
		

		
			 
		

		
			-- Preliminary Reports (work progress reports at the end of each year) 
		

		
			-- Final Report for each phase (paper and electronic format): this report will include in particular :
		

		
			-- Text and plates 
		

		
			-- Report on the field geological work  
		

		
			-- Conventional and special analysis of the cores
		

		
			-- Copy of electrical logs of drilling in standard electronic format (Las, picture) 
		

		
			-- Copies of different laboratory studies and analyses
		

		
			Geochemistry, 
		

		
			Stratigraphy 
		

		
			 Petrophysics 
		

		
			Sedimentology
		

		
			 
		

		
			Any other studies, operational reports and/or operational data resulting from any works executed by third parties on behalf of Operator directly relating to the Exploration Works or of Development and Exploitation Works in the area of the Exploration Permits. For the avoidance of doubt, this obligation does not apply to such information as any proprietary or confidential information or reports, parent company financial information, reserve information or confidential information or reports provided to governmental authorities.
		

		
			 
		

		
			Copy of all bids and contracts with a value exceeding two million U.S. dollars (US$ 2,000,000) with service companies, in hard-copy and electronic format.
		

		
			 
		

		
			
		

		
			

		 

		

			70

		

 

		

		
			 
		

		
			 
		

		
			 
		

		
			APPENDIX IV – JOINT DECLARATION OF PRINCIPLES
		

		
			 
		

		
			 
		

		
			 
		

		
			
		

		
			

		 

		

			71

		

 

		

		
			JOINT DECLARATION OF PRINCIPLES
		

		
			OF
		

		
			L'OFFICE NATIONAL DES HYDROCARBURES ET DES MINES (ONHYM)
		

		
			AND KOSMOS ENERGY
		

		
			 
		

		
			L'Office National des Hydrocarbures et des Mines (ONHYM) and Kosmos Energy hereby declare their common determination to contribute to the exploration and production of hydrocarbon natural resources in the zones of interest or activity onshore and offshore, including the Sahara region, based on exploration permits issued by the relevant Moroccan authorities, and based on the following principles:
		

		
			 
		

		
			1.  ONHYM and Kosmos Energy note that the mining and hydrocarbon sectors in Morocco are liberalized and that the exploration and production of hydrocarbon natural resources  adheres to international principles and standards, to relevant national legislation, including the Exploration Code, the Hydrocarbon Code and environmental law.
		

		
			 
		

		
			2.  The exploration and production of hydrocarbon natural resources will be in accordance with the principles enshrined in the Kingdom of Morocco Constitution and international standards, including those from the United Nations Charter stipulated in letter S/2002/161 dated January 29, 2002, addressed to the  President of the UN Security Council, signed by the Under-Secretary General  for Legal Affairs, and guidelines recommended by the "New model of development " of the Conseil  Economique, Social et Environnemental  (CESE), from November 2013, namely  that local  populations and their representatives are involved and consulted and that they will benefit equitably and effectively therefrom.  The exploration and production of hydrocarbon natural resources will contribute in a transparent manner to the development of the regions concerned.
		

		
			 
		

		
			3.  Kosmos Energy is committed to ensuring the  protection of the environment and compliance with the sustainable development requirements.
		

		
			 
		

		
			 
		

			
					
						 

					
					
						Signed in Rabat, 19 December 2013

				
	
					
						 

					
					
						 

				
	
					
						For ONHYM

					
					
						 

				
	
					
						 

					
					
						For Kosmos Energy

				
	
					
						 

					
					
						 

				
	
					
						(original French version signed)

					
					
						(original French version signed)

				

		
			 
		

		 

		

			72

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