Document:

Exhibit 10.2

 

OMNIBUS
AGREEMENT

 

This OMNIBUS AGREEMENT (this “Agreement”), is entered into as of
March 15, 2010, by and between Genco Shipping & Trading Limited, a
Marshall Islands corporation (“Genco”) and Baltic Trading Limited, a
Marshall Islands corporation (“Baltic”). 
The foregoing shall be referred to individually as a “Party” and
collectively as the “Parties.” 
Certain capitalized terms have the meanings assigned to them in Article I
hereof.

 

RECITALS

 

A.  Genco has formed Baltic for
the purpose of, among other things, acquiring, owning and operating certain drybulk
vessels that trade in the spot market or on spot market-related time charters.

 

B.  The respective Boards of
Directors of Genco and Baltic have authorized the Parties to enter into this Agreement and
effect the actions set forth below.

 

C.  The Parties desire, in
connection with the proposed initial public offering (the “Offering”) of
Baltic, to undertake the transactions contemplated by this Agreement, including, without
limitation, the allocation of certain business opportunities between (i) Genco
and its affiliates other than the Baltic Group members and (ii) the Baltic
Group members.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of their mutual undertakings and
agreements hereunder, the Parties undertake and agree as follows:

 

ARTICLE
I

DEFINITIONS; RECORDATION

 

1.01         Definitions.  In addition to terms defined above or
elsewhere in this Agreement, the following capitalized terms have the meanings
given below.

 

An “affiliate” of any Person
means any other Person which directly, or indirectly through one or more
intermediaries, controls, is controlled by or is under common control with,
such Person.  The term “control”
(including the terms “controlling,” “controlled by” and “under common control
with”) as used with respect to any Person means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities, by
contract or otherwise.  A person who is
the owner of 20% or more of the outstanding voting shares of any corporation,
partnership, unincorporated association or other entity shall be presumed to
have control of such entity, in the absence of proof by a preponderance of the
evidence to the contrary. Notwithstanding the foregoing, a presumption of
control shall not apply where such person holds voting shares, in good faith
and not for the purpose of circumventing this provision, as an agent, bank,
broker, nominee, custodian or trustee for one or more owners who do not
individually or as a group have control of such entity.

 

1

 

“Articles of Incorporation” means the
Amended and Restated Articles of Incorporation of Baltic, as they may be
further amended from time to time.

 

“Baltic Group” means, collectively,
Baltic and its subsidiaries.

 

“Business Day” means a day other than
a Saturday, Sunday or statutory holiday on which the banks in New York, New
York are required to close.

 

“Common Stock” means the Common
Stock, par value $0.01 per share, of Baltic.

 

“Class B Stock” means the Class B
Stock, par value $0.01 per share, of Baltic, which entitles the holder thereto
to the voting and other rights as set forth in the Articles of Incorporation.

 

“Person”
means any individual, sole proprietorship, partnership, limited liability
company, joint venture, trust, incorporated organization, association,
corporation, institution, public benefit corporation or any other entity.

 

“Registration Rights Agreement” means
the Registration Rights Agreement, to be entered into between Genco and Baltic,
in substantially the form of Exhibit A attached hereto.

 

“Trip Charter”
means a time charter for a trip to carry a specific cargo from a load port to a
discharge port at a set daily rate.

 

“Voyage
Charter” means a charter for the carriage of a specific cargo
from a load port to a discharge port at an agreed upon freight rate expressed
on a U.S. dollar-per-ton basis.

 

ARTICLE
II

ALLOCATION OF BUSINESS OPPORTUNITIES AND RIGHTS OF FIRST REFUSAL

 

2.01         Allocation of Business
Opportunities.  Baltic and
Genco hereby agree that Genco may engage (and shall have no duty to refrain
from engaging) in the same or similar activities or lines of business as the Baltic
Group members, including conducting business in the drybulk spot market, and
none of the Baltic Group members shall be deemed to have an interest or
expectancy in any business opportunity, transaction or other matter (including,
without limitation, any opportunity to acquire a drybulk vessel) (each such
opportunity, transaction or other matter being a “Business Opportunity”)
in which Genco engages or seeks to engage merely because any Baltic Group
member engages in the same or similar activities or lines of business as that
involved in or implicated by such Business Opportunity.

 

2.02         Right of First Refusal.  Subject to the terms and conditions specified
in this Article II:

 

(a)                                  if Genco, its affiliates, any Baltic
Group member, or any director or officer of the foregoing acquires knowledge of
a potential Business Opportunity that may be deemed to constitute a corporate
opportunity of both Genco and a Baltic Group 

 

2

 

member, Genco shall have
a right of first refusal to pursue or acquire such Business Opportunity for
itself unless such Business Opportunity is a Spot Charter Opportunity (defined
below); and

 

(b)                                 if Genco, its affiliates, any Baltic
Group member, or any director or officer of the foregoing acquires knowledge of
a potential opportunity to enter into a Voyage Charter or a Trip Charter for a
particular drybulk vessel (a “Spot Charter Opportunity”) that may be
deemed to constitute a corporate opportunity of both Genco and a Baltic Group
member, Baltic shall have a right of first refusal to elect to pursue or
acquire such Spot Charter Opportunity for itself.

 

Each time Genco or a Baltic Group member, as
applicable (the “Offering Party”) acquires knowledge of a Business
Opportunity for which the other Party (the “ROFR Party”) has a right of
first refusal, the Offering Party must first make an offering of the Business Opportunity
to the ROFR Party in accordance with the following provisions of this Article II
prior to pursuing such Business Opportunity.

 

2.03         Offer Notice.  The Offering Party shall give written notice
(the “Offering Notice”) to the ROFR Party stating that it has identified
a corporate opportunity and providing a description of the opportunity,
including all material terms and conditions of which the Offering Party has
knowledge.

 

2.04         Exercise of Right of First
Refusal.

 

(a)                                  Upon receipt of the Offering Notice, the
ROFR Party shall have twenty-four (24) hours if the Business Opportunity is a
Spot Charter Opportunity or fourteen (14) calendar days if the Business
Opportunity is not a Spot Charter Opportunity (the “ROFR Notice Period”)
to elect to pursue the Business Opportunity by delivering a written notice to
the Offering Party stating that the ROFR Party will pursue the Opportunity (a “ROFR
Notice”).

 

(b)                                 If the ROFR Party does not deliver a ROFR
Offer Notice during the ROFR Notice Period, it shall be deemed to have waived
all of its rights to pursue the Business Opportunity under this Article II,
and the Offering Party shall thereafter be free to pursue the Business
Opportunity specified in the Offer Notice without any further obligation to
such Party pursuant to this Article II.

 

2.05         Limitation on Duty to
Notify.  If the ROFR Party
is the first to learn of a Business Opportunity, then neither the ROFR Party nor
its directors or officers shall have any duty to communicate or offer such Business
Opportunity to the Offering Party.

 

2.06         Vessel Pools.
 As the entry of a drybulk vessel by one
Party into a vessel pool would not prevent the other Party from taking the same
action, neither Party shall have any obligation under Sections 2.02 through
2.04 hereunder with respect to the entry of any drybulk vessel into a vessel
pool.

 

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2.07         Definitions.  For purposes of this Article II
only (a) the term “Baltic Group” shall mean Baltic and all persons
or entities in which Baltic beneficially owns, directly or indirectly, 50% or
more of the outstanding voting stock, voting power, partnership interests or
similar voting interests, and (b) the term “Genco” shall mean Genco
and all persons or entities (other than the Baltic Group, as defined in
accordance with clause (a) of this Section 2.07) (i) in
which Genco beneficially owns, directly or indirectly, 50% or more of the
outstanding voting stock, voting power, partnership interests or similar voting
interests or (ii) which otherwise are affiliates of Genco.

 

ARTICLE
III

CREDIT FACILITIES

 

In order to comply
with the provisions of Genco’s existing credit facility on the date hereof and
any future credit facility of Genco, Baltic shall:

 

(a)                                  not issue any shares of preferred stock
without the prior written consent of Genco; and

 

(b)                                 use commercially reasonable efforts not
to take any action that would result in an event of default under Genco’s
existing credit facility as of the date hereof or the terms of any future
credit facility Genco may enter into to the extent such terms impose no greater
restrictions on Genco’s affiliates than such existing credit facility.

 

ARTICLE
IV

MISCELLANEOUS

 

4.01         Term; Termination.  This agreement shall continue in full force
and effect until the date that (a) Genco ceases to beneficially own shares
of Common Stock and Class B Stock representing at least 10% of the
aggregate number of outstanding shares of Common Stock and Class B Stock
of Baltic and (b) no person who is a director or officer of any Baltic
Group member is also a director or officer of Genco or any of its affiliates
other than the Baltic Group members. 
Notwithstanding the foregoing, no addition to, alteration of or
termination of Article II shall eliminate or impair the effect of Article II
on any act, omission, right or liability that occurred prior thereto.

 

4.02         Enforcement.  Each Party agrees and acknowledges that the
other Parties do not have an adequate remedy at law for the breach by any such
Party of its covenants and agreements set forth in Article II, and
that any breach by any such Party of its covenants and agreements set forth in Article II
would result in irreparable injury to such other Parties.  Each Party further agrees and acknowledges
that any other Party may, in addition to the other remedies which may be
available to such other Party, file a suit in equity to enjoin such Party from
such breach, and consent to the issuance of injunctive relief to enforce the
provisions of Article II of this Agreement.

 

4.03         Integration.  This Agreement and the instruments referenced
herein supersede all previous understandings or agreements among the Parties,
whether oral or written, with respect to the subject matter hereof.  This Agreement and such instruments contain
the entire understanding of the Parties with respect to the subject matter
hereof and thereof.  No 

 

4

 

understanding,
representation, promise or agreement, whether oral or written, is intended to
be or shall be included in or form part of this Agreement unless it is
contained in a written amendment hereto executed by the Parties hereto after
the date of this Agreement.

 

4.04         Headings; References;
Interpretation.  All Article and
Section headings in this Agreement are for convenience only and shall not
be deemed to control or affect the meaning or construction of any of the
provisions hereof.  The words “hereof,” “herein”
and “hereunder” and words of similar import, when used in this Agreement, shall
refer to this Agreement as a whole and not to any particular provision of this
Agreement.  All references herein to
Articles and Sections shall, unless the context requires a different
construction, be deemed to be references to the Articles and Sections of this
Agreement, respectively.  All personal
pronouns used in this Agreement, whether used in the masculine, feminine or neuter
gender, shall include all other genders, and the singular shall include the
plural and vice versa.  The use herein of
the word “including” following any general statement, term or matter shall not
be construed to limit such statement, term or matter to the specific items or
matters set forth immediately following such word or to similar items or
matters, whether or not non-limiting language (such as “without limitation,” “but
not limited to,” or words of similar import) is used with reference thereto,
but rather shall be deemed to refer to all other items or matters that could
reasonably fall within the broadest possible scope of such general statement,
term or matter.

 

4.05         Successors and Assigns.  The Agreement shall be binding upon and inure
to the benefit of the Parties and their respective successors and assigns.

 

4.06         No Third Party Rights.  The provisions of this Agreement are intended
to bind the Parties as to each other and are not intended to and do not create
rights in any other person or confer upon any other person any benefits, rights
or remedies and no person is or is intended to be a third party beneficiary of
any of the provisions of this Agreement.

 

4.07         Counterparts.  This Agreement may be executed in any number
of counterparts, all of which together shall constitute one agreement binding
on the parties hereto.

 

4.08         Governing Law.  This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York, applicable to
contracts made and to be performed wholly within such jurisdiction without giving
effect to conflict of law principles thereof other than Section 5-1401 of
the New York General Obligations Law.

 

4.09         Severability.  If any of the provisions of this Agreement is
held by any court of competent jurisdiction to contravene, or to be invalid
under, the laws of any governmental body having jurisdiction over the subject
matter hereof, such contravention or invalidity shall not invalidate the entire
Agreement.  Instead, this Agreement shall
be construed as if it did not contain the particular provision or provisions
held to be invalid, and an equitable adjustment shall be made and necessary
provision added so as to give effect, as nearly as possible, to the intention
of the Parties as expressed in this Agreement at the time of execution of this
Agreement.

 

4.10         Deed; Bill of Sale;
Assignment.  To the extent
required and permitted by applicable Law, this Agreement shall also constitute
a “deed,” “bill of sale” or “assignment” of the Assets.

 

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4.11         Amendment or Modification.  This Agreement may be amended or modified
from time to time only by the written agreement of all the Parties hereto; provided,
however, that the prior approval of the Conflicts Committee of the Board
of Directors of Baltic shall be required for any proposed amendment that would,
in the reasonable determination of Baltic’s Board of Directors, adversely
affect the holders of Common Stock (other than Genco).

 

4.12         Notices.  Each notice,
consent or request required to be given to a Party pursuant to this Agreement
must be given in writing. A notice may be given by delivery to an individual or
by fax, and shall be validly given if delivered on a Business Day to an
individual at the following address, or, if transmitted on a Business Day, by
fax or email addressed to the following Party:

 

	
  (a)

  	
  if
  to Baltic:

  	
  (b)

  	
  if
  to Genco:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Address:   299
  Park Avenue, 20th Floor

  	
   

  	
  Address:   299
  Park Avenue, 20th Floor

  
	
   

  	
  New
  York, NY 10171

  	
   

  	
  New York, NY 10171

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Attention:  John C. Wobensmith

  	
   

  	
  Attention:  Robert Gerald Buchanan

  
	
   

  	
      President and Chief Financial Officer

  	
   

  	
      President

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Fax
  No.:    (646) 443-8551

  	
   

  	
  Fax
  No.:    (646) 443-8551

  

 

or
to any other address or fax number that the Party so designates by notice given
in accordance with this Section. Any notice

 

(a) if
validly delivered on a Business Day, shall be deemed to have been given when
delivered; and

 

(b) if
validly transmitted by fax on a Business Day, shall be deemed to have been
given on that Business Day.

 

[Remainder of Page Intentionally
Left Blank]

 

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IN WITNESS WHEREOF, this Omnibus
Agreement has been duly executed by the parties set forth below.

 

 

	
   

  	
  GENCO
  SHIPPING & TRADING LIMITED

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John C.
  Wobensmith

  
	
   

  	
   

  	
  Name:  John C. Wobensmith

  
	
   

  	
   

  	
  Title:  Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BALTIC TRADING LIMITED

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John C.
  Wobensmith

  
	
   

  	
   

  	
  Name:  John C. Wobensmith

  
	
   

  	
   

  	
  Title:  President and Chief
  Financial OfficerExhibit 10.3

 

REGISTRATION RIGHTS AGREEMENT

 

REGISTRATION
RIGHTS AGREEMENT is dated as of March 15, 2010 and is by and between BALTIC
TRADING LIMITED, a Marshall Islands corporation (the “Company”),
and GENCO INVESTMENTS LLC, a Marshall Islands limited liability company (the “Stockholder”).

 

In
consideration of the mutual covenants and agreements herein contained and other
good and valid consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties to this Agreement hereby agree as follows:

 

1.             Certain
Definitions.

 

(a)           In addition to
the terms defined elsewhere in this Agreement, the following terms shall have
the following meanings:

 

(b)           “Affiliate” of any Person means any
other Person which directly or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with, such Person.

 

(c)           “Agreement” means this Registration
Rights Agreement, including all amendments, modifications and supplements and
any exhibits or schedules to any of the foregoing, and shall refer to this
Registration Rights Agreement as the same may be in effect at the time such
reference becomes operative.

 

(d)           “Class B Stock” means shares of the
Class B Stock, par value $0.01 per share, of the Company.

 

(e)           “Common Stock” means shares of Common
Stock, par value $0.01 per share, of the Company, including Common Stock
issuable upon conversion of Class B Stock and any other shares into which
such shares are converted pursuant to a recapitalization or reorganization.

 

(f)            “Company” has the meaning set forth
in the introductory paragraph.

 

(g)           “Control,” including the terms “controlling,”
“controlled by” and “under common control with,” means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of a person, whether through the ownership of voting shares, by
contract or otherwise. A person who is the owner of 20% or more of the
outstanding voting shares of any corporation, partnership, unincorporated
association or other entity shall be presumed to have control of such entity,
in the absence of proof by a preponderance of the evidence to the contrary.
Notwithstanding the foregoing, a presumption of control shall not apply where
such person holds voting shares, in good faith and not for the purpose of
circumventing this provision, as an agent, bank, broker, nominee, custodian or
trustee for one or more owners who do not individually or as a group have
control of such entity.

 

(h)           “Demand Registration” has the meaning
set forth in Section 2(a) hereof.

 

 

(i)            “Dissolution” has the meaning set
forth in Section 9 hereof.

 

(j)            “Exchange Act” means the Securities
Exchange Act of 1934, as amended.

 

(k)           “Governmental Entity” means any
national, federal, state, municipal, local, territorial, foreign or other
government or any department, commission, board, bureau, agency, regulatory
authority or instrumentality thereof, or any court, judicial, administrative or
arbitral body or public or private tribunal.

 

(l)            “Holder” means any person that owns
Registrable Shares, including such successors and assigns as acquire
Registrable Shares, directly or indirectly, from such Person.  For purposes of this Agreement, the Company
may deem and treat the registered holder of Registrable Shares as the Holder
and absolute owner thereof, and the Company shall not be affected by any notice
to the contrary.

 

(m)          “Initiating Holders” has the meaning
set forth in Section 2(a) hereof.

 

(n)           “Person” means any individual, sole
proprietorship, partnership, limited liability company, joint venture, trust,
incorporated or unincorporated organization, association, corporation,
institution, public benefit corporation, Governmental Entity or any other
entity.

 

(o)           “Piggyback Registration” has the
meaning set forth in Section 4(a) hereof.

 

(p)           “Prospectus” means the prospectus or
prospectuses included in any Registration Statement, as amended or supplemented
by any prospectus supplement, with respect to the terms of the offering of any
portion of the Registrable Shares covered by such Registration Statement and by
all other amendments and supplements to the prospectus, including
post-effective amendments and all material incorporated by reference in such
prospectus or prospectuses.

 

(q)           “Qualifying IPO” means the sale in an
underwritten initial public offering registered under the Securities Act of
shares of Common Stock of the Company.

 

(r)            “Registrable Shares” means shares of Common
Stock held by the Stockholder or Affiliates of the Stockholder (excluding
natural persons) or shares of Common Stock receivable upon the conversion of Class B
Stock held by the Stockholder or Affiliates of the Stockholder (excluding
natural persons) or any shares of any successor or acquiror of the Company issued
in exchange or substitution for any of the foregoing in connection with any
acquisition, merger, combination, or similar transaction involving the Company;
provided, however, Registrable Shares shall not include any
securities sold by a Person to the public either pursuant to a Registration
Statement or Rule 144 or any securities that may be sold pursuant to Rule 144
without restriction.

 

(s)           “Registration Expenses” has the
meaning set forth in Section 7(a) hereof.

 

2

 

(t)            “Registration Statement” means any
registration statement of the Company which covers any of the Registrable
Shares pursuant to the provisions of this Agreement, including the Prospectus,
amendments and supplements to such Registration Statement, including post-effective
amendments, all exhibits and all materials incorporated by reference in such
Registration Statement.

 

(u)           “SEC” means the Securities and
Exchange Commission.

 

(v)           “Securities Act” means the Securities
Act of 1933, as amended.

 

(w)          “Senior Management” means the Chief
Executive Officer, President and/or Chief Financial Officer of the Company.

 

(x)            “Shelf Registration”  has the meaning set forth in Section 3(a) hereof.

 

(y)           “Stockholder” has the meaning set
forth in the introductory paragraph.

 

(z)            “Suspension Notice” has the meaning
set forth in Section 6(f) hereof.

 

(aa)         “underwritten registration” or “underwritten offering” means a
registration in which securities of the Company are sold to underwriters for
reoffering to the public.

 

(bb)         “Withdrawn Demand Registration” has
the meaning set forth in Section 2(f) hereof.

 

2.             Demand
Registrations.

 

(a)           Right to
Request Registration.  At any time
commencing 180 days following the closing of a Qualifying IPO, any Holder or
Holders of either (i) a number Registrable Shares equal to at least 50% of
the number of Registrable Shares as of the date hereof or (ii) Registrable
Shares having an aggregate market value of at least $25 million at the time of
request may request registration under the Securities Act (“Initiating Holders”) of all or part
of the Registrable Shares (“Demand Registration”);
provided, however, that each Demand Registration be for
Registrable Shares.

 

Within
ten (10) days after receipt of any such request for Demand Registration,
the Company shall give written notice of such request to all other Holders of Registrable
Shares and shall, subject to the provisions of Section 2(d) hereof,
include in such registration all such Registrable Shares with respect to which
the Company has received written requests for inclusion therein within fifteen (15)
days after the receipt of the Company’s notice.

 

(b)           Number of
Demand Registrations.  Subject to
the provisions of Section 2(a), the Initiating Holders of Registrable
Shares shall collectively be entitled to request an aggregate of three (3) Demand
Registrations.  A registration shall not
count as one of the permitted Demand Registrations (i) until it has become
effective, (ii) if the Initiating Holders requesting such registration are
not able to have registered and sold at least 50% of the Registrable Shares 

 

3

 

requested
by such Initiating Holders to be included in such registration or (iii) in
the case of a Demand Registration that would be the last permitted Demand
Registration requested hereunder, if the Initiating Holders requesting such
registration are not able to have registered and sold all of the Registrable
Shares requested to be included by such Initiating Holders in such
registration.

 

(c)           Priority on
Demand Registrations.  The Company
shall not include in any Demand Registration any securities which are not Registrable
Shares without the written consent of the Holders of a majority of the Registrable
Shares to be included in such registration, or, if such Demand Registration is
an underwritten offering, without the written consent of the managing
underwriters.  If the managing
underwriters of the requested Demand Registration advise the Company in writing
that in their opinion the number of shares of Registrable Shares proposed to be
included in any such registration exceeds the number of securities which can be
sold in such offering without having an adverse affect on such offering,
including the price at which such Registrable Shares can be sold, the Company
shall include in such registration only the number of shares of Registrable
Shares which in the opinion of such managing underwriters can be sold without
having the adverse effect referred to above. 
If the number of shares which can be sold without having the adverse
effect referred to above is less than the number of shares of Registrable
Shares proposed to be registered, the amount of Registrable Shares to be so
sold shall be allocated pro rata among the Holders of Registrable Shares desiring
to participate in such registration on the basis of the amount of such Registrable
Shares initially proposed to be registered by such Holders.  If the number of shares which can be sold
exceeds the number of shares of Registrable Shares proposed to be sold, such
excess shall be allocated pro rata among the other holders of securities, if
any, desiring to participate in such registration based on the amount of such
securities initially requested to be registered by such holders or as such
holders may otherwise agree.

 

(d)           Restrictions on
Demand Registrations.  The Company
shall not be obligated to effect any Demand Registration within three (3) months
after the termination of an offering under a previous Demand Registration or a
previous registration under which the Initiating Holder had piggyback rights
pursuant to Section 4 hereof where the Initiating Holder was
permitted to register and sell 50% of the Registrable Shares requested to be
included therein.  The Company may
postpone for up to ninety (90) days the filing or the effectiveness of a
Registration Statement for a Demand Registration if, based on the good faith
judgment of the Company’s board of directors, such filing or effectiveness
would be materially detrimental to the Company and its stock holders, such
postponement or withdrawal is necessary in order to avoid premature disclosure
of a matter the board has determined would not be in the best interest of the
Company to be disclosed at such time; and provided, further, that
in the event described above, the Initiating Holders requesting such Demand
Registration shall be entitled to withdraw such request prior to its effective
date and, if such request is withdrawn, such Demand Registration shall not
count as one of the permitted Demand Registrations.  The Company shall provide written notice to
the Initiating Holders requesting such Demand Registration of (i) any
postponement or withdrawal of the filing or effectiveness of a Registration
Statement pursuant to this Section 2(d), (ii) the Company’s
decision to file or seek effectiveness of such Registration Statement following
such withdrawal or postponement and (iii) the effectiveness of such
Registration Statement.  The Company may
defer the filing of a particular Registration Statement pursuant to this Section 2(d) only
once during any twelve (12) month period.

 

4

 

(e)           Selection of
Underwriters.  If any of
the Registrable Shares covered by a Demand Registration are to be sold in an
underwritten offering, the Initiating Holders shall have the right to select
the managing underwriter(s) to administer the offering subject to the
approval of the Company, which will not be unreasonably withheld.

 

(f)            Effective
Period of Demand Registrations.  After any Demand Registration filed pursuant
to this Agreement has become effective, the Company shall use its reasonable best
efforts to keep such Demand Registration effective for a period equal to 180
days from the date on which the SEC declares such Demand Registration effective
(or if such Demand Registration is not effective during any period within such
180 days, such 180-day period shall be extended by the number of days during
such period when such Demand Registration is not effective), or such shorter
period which shall terminate when all of the Registrable Shares covered by such
Demand Registration have been sold pursuant to such Demand Registration.  If the Company shall withdraw any Demand
Registration pursuant to Section 2(d) (a “Withdrawn
Demand Registration”), the Initiating Holders of the Registrable
Shares remaining unsold and originally covered by such Withdrawn Demand
Registration shall be entitled to a replacement Demand Registration which
(subject to the provisions of this Section 2) the Company shall use
its reasonable best efforts to keep effective for a period commencing on the
effective date of such Demand Registration and ending on the earlier to occur
of the date (i) which is 180 days from the effective date of such Demand
Registration and (ii) on which all of the Registrable Shares covered by
such Demand Registration have been sold. 
Such additional Demand Registration otherwise shall be subject to all of
the provisions of this Agreement.

 

3.             Shelf
Registration.

 

(a)           (i) At
such time as the Company is able to use Form S-3 under the Securities Act
(or any successor form) for sales of Registrable Shares by a Holder, at the
request of one or more Holders of the lesser of (A) a number Registered
Shares equal to at least 50% of the number of Registrable Shares as of the date
hereof or (B) Registrable Shares having an aggregate market value of at
least $25 million at the time of request, the Company shall use its reasonable best
efforts to effect, as expeditiously as possible, the registration under the
Securities Act of any number of Registrable Shares for which it receives
requests in accordance with Section 2(a) (the “Shelf Registration”).  The Company shall use its reasonable best
efforts to cause such Registration Statement to become effective as promptly as
practicable and maintain the effectiveness of such Registration Statement
(subject to the terms and conditions herein) for a period ending on the earlier
of (i) two (2) years following the date on which such Registration
Statement first becomes effective (but one (1) year if the Company is not
able to use Form S-3 under the Securities Act (or any successor form)),
and (ii) the date on which all Registrable Shares covered by such
Registration Statement have been sold and the distribution contemplated thereby
has been completed or have become freely tradeable pursuant to Rule 144
without regard to volume.

 

(b)           The Shelf
Registration Statement pursuant to this Section 3 shall to the
extent possible under applicable law, be effected to permit sales on a
continuous basis pursuant to Rule 415 under the Securities Act.  Any takedown under the Shelf Registration
pursuant to this 

 

5

 

Section 3 may or may not
be underwritten; provided, however, that (i) Holders may
request any underwritten takedown only to be effected as a Demand Registration
(in which event, unless such Demand Registration would not require
representatives of the Company to meet with prospective purchasers of the
Company’s securities, a Demand Registration must be available thereunder and
the number of Demand Registrations available shall be reduced by one subject to
Section 2(b)) or (ii) Holders may request an unlimited number
of underwritten takedowns to be effected in accordance with the terms of Section 4.  The Company shall be entitled to effect the
Shelf Registration on any available form under the Securities Act.

 

(c)           In the event of
a request for a Shelf Registration pursuant to Section 3(a), the
Company shall give written notice of the proposed filing of the Registration
Statement in connection therewith to all Holders of Registrable Shares offering
to each such Holder the opportunity to have any or all of the Registrable
Shares held by such Holder included in such registration statement.  Each Holder of Registrable Shares desiring to
have its Registrable Shares registered under this Section 3(c) shall
so advise the Company in writing within fifteen (15) days after the date of
such notice from the Company (which request shall set forth the amount of Registrable
Shares for which registration is requested), and the Company shall include in
such Registration Statement all such Registrable Shares so requested to be
included therein.

 

(d)           The number,
percentage, fraction or kind of shares referred to in this Section 3
shall be appropriately adjusted for any stock dividend, stock split, reverse
stock split, combination, recapitalization, reclassification, merger or
consolidation, exchange or distribution in respect of the shares of Common
Stock.

 

(e)           The Company,
and any other holder of the Company’s securities who has registration rights,
may include its securities in any Shelf Registration effected pursuant to this Section 3.

 

4.             Piggyback
Registrations.

 

(a)           Right to
Piggyback.  If at any
time commencing 180 days following the closing of a Qualifying IPO the Company
proposes to register any of its common equity securities under the Securities
Act (other than a registration statement on Form S-8 or on Form S-4
or any similar successor forms thereto or a registration statement covering an
offering of convertible securities), whether for its own account or for the
account of one or more stockholders of the Company, and the registration form
to be used may be used for any registration of Registrable Shares (a “Piggyback Registration”), the
Company shall give prompt written notice (in any event within twenty (20) days after
its receipt of notice of any exercise of other demand registration rights) to each
Holders of Registrable Shares having a market value at such time of at least $1
million of its intention to effect such a registration and, subject to Sections
4(b) and 4(c), shall include in such registration all Registrable
Shares with respect to which the Company has received written requests for inclusion
therein within fifteen (15) days after the effectiveness of the Company’s
notice.  The Company may postpone or
withdraw the filing or the effectiveness of a Piggyback Registration at any
time in its sole discretion.

 

6

 

(b)           Priority on
Primary Registrations.  If a
Piggyback Registration is an underwritten primary registration on behalf of the
Company, and the managing underwriters advise the Company in writing that in
their opinion the number of securities requested to be included in such
registration exceeds the number which can be sold in such offering without
having an adverse effect on such offering, the Company shall include in such
registration (i) first, the securities the Company proposes to sell, (ii) second,
the Registrable Shares requested to be included therein by the Holders, pro
rata among the Holders of such Registrable Shares on the basis of the number of
shares requested to be registered by such Holders, and (iii) third, other
securities requested to be included in such registration pro rata among the
holders of such securities on the basis of the number of shares requested to be
registered by such holders or as such holders may otherwise agree.

 

(c)           Priority on
Secondary Registrations.  If a
Piggyback Registration is an underwritten secondary registration on behalf of a
holder of the Company’s securities other than Registrable Shares, and the
managing underwriters advise the Company in writing that in their opinion the
number of securities requested to be included in such registration exceeds the
number which can be sold in such offering without having an adverse effect on
such offering, the Company shall include in such registration (i) first
the securities requested to be included therein by the holders requesting such
registration and the Registrable Shares requested to be included in such
registration, pro rata among the holders of such securities on the basis of the
number of shares requested to be registered by such holders, and (ii) second,
other securities requested to be included in such registration pro rata among
the holders of such securities on the basis of the number of shares requested
to be registered by such holders or as such holders may otherwise agree.

 

(d)           Selection of Underwriters.  If any Piggyback Registration is an
underwritten primary offering, the Company shall have the right to select the
managing underwriter or underwriters to administer any such offering.

 

(e)           Other
Registrations.  If the
Company has previously filed a Registration Statement with respect to Registrable
Shares, and if such previous registration has not been withdrawn or abandoned,
the Company shall not be obligated to cause to become effective any other
registration of any of its securities under the Securities Act, whether on its
own behalf or at the request of any holder or holders of such securities, until
a period of at least ninety (90) days has elapsed from the termination of the
offering under the previous registration.

 

5.             Holdback
Agreements.

 

The
Company agrees not to effect any sale or distribution of any of its common equity
securities during the ten (10) days prior to and during the 180 days
beginning on the pricing date of any underwritten offering pursuant to any Demand
Registration or any Piggyback Registration (except as part of such underwritten
registration or pursuant to registrations on Form S-8 or S-4 or any
successor forms thereto) unless the underwriters managing the offering
otherwise agree to a shorter period.

 

7

 

6.             Registration
Procedures.

 

(a)           Whenever the
Holders request that any Registrable Shares be registered pursuant to this
Agreement, the Company shall use its reasonable best efforts to effect the
registration and the sale of such Registrable Shares in accordance with the
intended methods of disposition thereof, and pursuant thereto the Company shall
as expeditiously as possible:

 

(i)            prepare and file with the
SEC a Registration Statement with respect to such Registrable Shares and use
its reasonable best efforts to cause such Registration Statement to become
effective as soon as practicable thereafter; and before filing a Registration
Statement or Prospectus or any amendments or supplements thereto, furnish to
the Holders of Registrable Shares covered by such Registration Statement and
the underwriter or underwriters, if any, copies of all such documents proposed
to be filed, including documents incorporated by reference in the Prospectus
and, if requested by such Holders, the exhibits incorporated by reference, and
such Holders shall have the opportunity to object to any information pertaining
to such Holders that is contained therein and the Company will make the
corrections reasonably requested by such Holders with respect to such
information prior to filing any Registration Statement or amendment thereto or
any Prospectus or any supplement thereto;

 

(ii)           prepare and file with the
SEC such amendments and supplements to such Registration Statement and the
Prospectus used in connection therewith as may be necessary to keep such
Registration Statement effective for a period of not less than 180 days, in the
case of a Demand Registration or such shorter period as is necessary to
complete the distribution of the securities covered by such Registration
Statement and comply with the provisions of the Securities Act with respect to
the disposition of all securities covered by such Registration Statement during
such period in accordance with the intended methods of disposition by the
sellers thereof set forth in such Registration Statement;

 

(iii)          furnish to each seller of Registrable
Shares such number of copies of such Registration Statement, each amendment and
supplement thereto, the Prospectus included in such Registration Statement
(including each preliminary Prospectus) and such other documents as such seller
may reasonably request in order to facilitate the disposition of the Registrable
Shares owned by such seller;

 

(iv)          use its reasonable best
efforts to register or qualify such Registrable Shares under such other
securities or blue sky laws of such jurisdictions as any seller reasonably
requests and do any and all other acts and things which may be reasonably
necessary or advisable to enable such seller to consummate the disposition in
such jurisdictions of the Registrable Shares owned by such seller (provided,
however, that the Company will not be required to (A) qualify
generally to do business in any jurisdiction where it would not otherwise be
required to qualify but for this subparagraph 6(a)(iv)(B) subject itself
to taxation in any such jurisdiction, or (C) consent to general service of
process in any such jurisdiction);

 

8

 

(v)           notify each seller of such Registrable
Shares, at any time when a Prospectus relating thereto is required to be
delivered under the Securities Act, of the occurrence of any event as a result
of which the Prospectus included in such Registration Statement contains an
untrue statement of a material fact or omits any fact necessary to make the
statements therein not misleading, and, at the request of any such seller, the
Company shall prepare a supplement or amendment to such Prospectus so that, as
thereafter delivered to the purchasers of such Registrable Shares, such
Prospectus shall not contain an untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein not
misleading;

 

(vi)          in the case of an
underwritten offering, enter into such customary agreements (including
underwriting agreements in customary form with customary indemnification
provisions) and take all such other actions as the Holders of a majority of the
Registrable Shares being sold or the underwriters reasonably request in order
to expedite or facilitate the disposition of such Registrable Shares
(including, without limitation, making members of Senior Management of the
Company available to participate in, and cause them to cooperate with the
underwriters in connection with, “road-show” and other customary marketing
activities (including one-on-one meetings with prospective purchasers of the Registrable
Shares)) and cause to be delivered to the underwriters and the sellers, if any,
opinions of counsel to the Company in customary form, covering such matters as
are customarily covered by opinions for an underwritten public offering as the
underwriters may request and addressed to the underwriters and the sellers;

 

(vii)         make available, for
inspection by any seller of Registrable Shares, any underwriter participating
in any disposition pursuant to such Registration Statement, and any attorney,
accountant or other agent retained by any such seller or underwriter, all
financial and other records, pertinent corporate documents and properties of the
Company, and cause the Company’s officers, directors, employees and independent
accountants to supply all information reasonably requested by any such seller,
underwriter, attorney, accountant or agent in connection with such Registration
Statement, subject to any confidentiality restrictions which the Company
reasonably deems necessary;

 

(viii)        use its reasonable best
efforts to cause all such Registrable Shares to be listed on the principal
securities exchange on which securities of the same class issued by the Company
are then listed;

 

(ix)           if requested, cause to be
delivered, immediately prior to the effectiveness of the Registration Statement
(and, in the case of an underwritten offering, at the time of delivery of any Registrable
Shares sold pursuant thereto), letters from the Company’s independent certified
public accountants addressed to each selling Holder (unless such selling Holder
does not provide to such accountants the appropriate representation letter
required by rules governing the accounting profession) and each
underwriter, if any, stating that such accountants are independent public
accountants within the meaning of the Securities Act and the applicable rules and
regulations adopted by the SEC 

 

9

 

thereunder, and otherwise in customary form and covering such financial
and accounting matters as are customarily covered by letters of the independent
certified public accountants delivered in connection with primary or secondary
underwritten public offerings, as the case may be;

 

(x)            make generally available to
its stockholders a consolidated earnings statement (which need not be audited)
for the twelve (12) months beginning after the effective date of a Registration
Statement as soon as reasonably practicable after the end of such period, which
earnings statement shall satisfy the requirements of an earning statement under
Section 11(a) of the Securities Act; and

 

(xi)           promptly notify each seller
of Registrable Shares and the underwriter or underwriters, if any:

 

(A)          when the Registration
Statement, any pre-effective amendment, the Prospectus or any Prospectus
supplement or post-effective amendment to the Registration Statement has been
filed and, with respect to the Registration Statement or any post-effective
amendment, when the same has become effective;

 

(B)           of any comments of the SEC
or of any written request by the SEC for amendments or supplements to the
Registration Statement or Prospectus;

 

(C)           of the notification to the
Company by the SEC of its initiation of any proceeding with respect to the
issuance by the SEC of any stop order suspending the effectiveness of the
Registration Statement; and

 

(D)          of the receipt by the
Company of any notification with respect to the suspension of the qualification
of any Registrable Shares for sale under the applicable securities or blue sky
laws of any jurisdiction.

 

(b)           The Company
shall ensure that no Registration Statement (including any amendments or
supplements thereto and Prospectuses contained therein) shall contain any
untrue statement of a material fact or omit to state a material fact required
to be stated therein, or necessary to make the statements therein not
misleading (except, with respect to any Holder, for an untrue statement or
alleged untrue statement of a material fact or omission or alleged omission of
a material fact made in reliance on and in conformity with written information
furnished to the Company by or on behalf of such Holder specifically for use
therein).

 

(c)           The Company
shall make available to each Holder whose Registrable Shares are included in a
Registration Statement (i) promptly after the same is prepared and
publicly distributed, filed with the SEC, or received by the Company, one copy
of each Registration Statement and any amendment thereto, each preliminary
Prospectus and Prospectus and each amendment or supplement thereto, each letter
written by or on behalf of the Company to the SEC or the staff of the SEC (or
other governmental agency or self-regulatory body or other body having
jurisdiction, including any domestic or foreign securities exchange), and each
item of correspondence from the SEC or the staff of the SEC (or other
governmental agency or self-

 

10

 

regulatory
body or other body having jurisdiction, including any domestic or foreign
securities exchange), in each case relating to such Registration Statement
(other than any portion thereof which contains information for which the
Company has sought confidential treatment), and (ii) such number of copies
of a Prospectus, including a preliminary Prospectus, and all amendments and
supplements thereto and such other documents as such Holder may reasonably
request in order to facilitate the disposition of the Registrable Shares owned
by such Holder.  The Company will
promptly notify each Holder by facsimile of the effectiveness of each
Registration Statement or any post-effective amendment.  The Company will promptly respond to any and
all comments received from the SEC, with a view towards causing each
Registration Statement or any amendment thereto to be declared effective by the
SEC as soon as practicable and shall file an acceleration request as soon as
practicable following the resolution or clearance of all SEC comments or, if
applicable, following notification by the SEC that any such Registration
Statement or any amendment thereto will not be subject to review.

 

(d)           At all times
after the Company has filed a registration statement with the SEC pursuant to
the requirements of either the Securities Act or the Exchange Act, the Company
shall file all reports required to be filed by it under the Securities Act and
the Exchange Act and the rules and regulations adopted by the SEC
thereunder, and take such further action as any Holders may reasonably request,
all to the extent required to enable such Holders to be eligible to sell Registrable
Shares pursuant to Rule 144 (or any similar rule then in effect).

 

(e)           the Company may
require each seller of Registrable Shares as to which any registration is being
effected to furnish to the Company any other information regarding such seller
and the distribution of such securities as the Company may from time to time
reasonably request in writing.

 

(f)            Each seller of Registrable
Shares agrees by having its shares treated as Registrable Shares hereunder
that, upon notice that the Prospectus included in such Registration Statement
(or any document incorporated therein) contains an untrue statement of a
material fact or omits any material fact necessary to make the statements
therein not misleading or that such Prospectus or Registration Statement  (or any document incorporated therein) must
be amended or supplemented for any other reason (a “Suspension
Notice”), such seller will forthwith discontinue disposition of Registrable
Shares for a reasonable length of time not to exceed sixty (60) days until such
seller is advised in writing by the Company that the use of the Prospectus may
be resumed and is furnished with a supplemented or amended Prospectus as
contemplated by Section 6(a)(v) hereof, and, if so directed by
the Company, such seller will deliver to the Company (at the Company’s expense)
all copies, other than permanent file copies then in such seller’s possession,
of the Prospectus covering such Registrable Shares current at the time of
receipt of such notice; provided, however, that such postponement
of sales of Registrable Shares by the Holders shall not exceed ninety (90) days
in the aggregate in any one (1) year. 
If the Company shall give any notice to suspend the disposition of Registrable
Shares pursuant to a Prospectus, the Company shall extend the period of time
during which the Company is required to maintain the Registration Statement
effective pursuant to this Agreement by the number of days during the period
from and including the date of the giving of such notice to and including the
date such seller either is advised by the Company that the use of the
Prospectus may be resumed or receives the copies of the supplemented or amended
Prospectus contemplated by 

 

11

 

Section 6(a)(v).  In any event, the Company shall not be
entitled to deliver more than three (3) Suspension Notices in any one (1) year.

 

7.             Registration
Expenses.

 

(a)           All expenses
incident to the Company’s performance of or compliance with this Agreement,
including, without limitation, all registration and filing fees, fees and
expenses of compliance with securities or blue sky laws, listing application
fees, printing expenses, transfer agent’s and registrar’s fees, cost of
distributing Prospectuses in preliminary and final form as well as any
supplements thereto, and fees and disbursements of counsel for the Company and
all independent certified public accountants and other Persons retained by the
Company (all such expenses being herein called “Registration
Expenses”) (but not including any underwriting discounts or
commissions attributable to the sale of Registrable Shares or fees and expenses
of more than one counsel representing the Holders of Registrable Shares), shall
be borne by the Company.  In addition,
the Company shall pay its internal expenses (including, without limitation, all
salaries and expenses of its officers and employees performing legal or
accounting duties), the expense of any annual audit or quarterly review, the
expense of any liability insurance which the Company may elect to obtain and
the expenses and fees for listing the securities to be registered on each
securities exchange on which they are to be listed.

 

(b)           In connection
with each registration initiated hereunder (whether a Demand Registration or a
Piggyback Registration), the Company shall reimburse the Holders covered by
such registration or sale for the reasonable fees and disbursements of one law
firm, plus local counsel as necessary, chosen by the Holders of a majority of
the Registrable Shares included in such registration or sale.

 

(c)           The obligation
of the Company to bear the expenses described in Section 7(a) and
to reimburse the Holders for the expenses described in Section 7(b) shall
apply irrespective of whether a registration, once properly demanded, if
applicable, becomes effective, is withdrawn or suspended, is converted to
another form of registration and irrespective of when any of the foregoing
shall occur; provided, however, that Registration Expenses for
any supplements or amendments to a Registration Statement or Prospectus
resulting from a misstatement furnished to the Company by a Holder shall be
borne by such Holder.  If any
Registration Statement for a Demand Registration is withdrawn solely at the
request of a Holder of Registrable Shares (unless withdrawn following
postponement of filing by the Company in accordance with Sections 2(d)(i)
or (ii)) and such request is the second or subsequent such withdrawal request
by any Holder complied with by the Company, then at the election of the
requesting Holder, either such Holder shall bear the Registration Expenses for
such Registration Statement, or the number of Demand Registrations available to
such Holder shall be reduced by one.

 

8.             Best
Available Rights Terms.

 

The
Company shall not grant to any Person the right, to request the Company to
register any common equity securities of the Company except such rights as are
not materially more favorable than or inconsistent with the rights granted to
the Holders herein. In the event the Company grants rights which are materially
more favorable, the Company will make such 

 

12

 

provisions
available to the Holders and will enter into any amendments necessary to confer
such rights on the Holders.

 

9.                                      Distribution
of Rights upon Dissolution of the Stockholder.

 

At
any time after the execution date of this Agreement, the Stockholder shall
cease to exist for any reason as a legal entity (a “Dissolution”),
if prior to such Dissolution the Stockholder distributed its shares in the
Company to its members or if the Stockholder has otherwise distributed such
shares to its members, such members shall have the same rights and obligations under
this Agreement as granted to the Stockholder as if such Dissolution had not
occurred.

 

10.                               Indemnification.

 

(a)           The Company
shall indemnify, to the fullest extent permitted by law, each Holder, each
underwriter for such Holder, their respective officers, directors and
Affiliates and each Person who controls such Holder or underwriter (within the
meaning of the Securities Act) against all losses, claims, damages, liabilities
and expenses arising out of or based upon any untrue or alleged untrue
statement of material fact contained in any Registration Statement, Prospectus
or preliminary Prospectus or any amendment thereof or supplement thereto or any
omission or alleged omission of a material fact required to be stated therein
or necessary to make the statements therein not misleading or any violation or
alleged violation by the Company of the Securities Act, the Exchange Act or
applicable “blue sky” laws, except insofar as the same are made in reliance and
in conformity with information relating to such Holder furnished in writing to
the Company by such Holder expressly for use therein or caused by such Holder’s
failure to deliver to such Holder’s immediate purchaser a copy of the
Registration Statement or Prospectus or any amendments or supplements thereto
(if the same was required by applicable law to be so delivered).

 

(b)           In connection
with any Registration Statement in which a Holder of Registrable Shares is
participating, each such Holder shall furnish to the Company in writing such
information and affidavits as the Company reasonably requests for use in
connection with any such Registration Statement or Prospectus and, shall
indemnify, to the fullest extent permitted by law, the Company, its officers,
directors Affiliates, and each Person who controls the Company (within the
meaning of the Securities Act) against all losses, claims, damages, liabilities
and expenses arising out of or based upon any untrue or alleged untrue
statement of material fact contained in the Registration Statement, Prospectus
or preliminary Prospectus or any amendment thereof or supplement thereto or any
omission or alleged omission of a material fact required to be stated therein
or necessary to make the statements therein not misleading, but only to the
extent that the same are made in reliance and in conformity with information
relating to such Holder furnished in writing to the Company by such Holder
expressly for use therein or caused by such Holder’s failure to deliver to such
Holder’s immediate purchaser a copy of the Registration Statement or Prospectus
or any amendments or supplements thereto (if the same was required by
applicable law to be so delivered) after the Company has furnished such Holder
with a sufficient number of copies of the same; provided, however,
that the obligation to indemnify shall be several, not joint and several, among
such Holders and the liability of each 

 

13

 

such
Holder shall be in proportion to and limited to the net amount received by such
Holder from the sale of Registrable Shares pursuant to such Registration
Statement.

 

(c)           Any Person
entitled to indemnification hereunder shall (i) give prompt written notice
to the indemnifying party of any claim with respect to which it seeks
indemnification; provided, however, that the failure to notify
the indemnifying party shall not relieve the indemnifying party from any
liability that it may have under this Section 10 except to the
extent that it has been materially prejudiced (through the forfeiture of
substantive rights or defenses) by such failure; and provided, further,
that the failure to notify the indemnifying party shall not relieve the
indemnifying party from any liability that it may have to an indemnified party
otherwise than under this Section 10 and (ii) unless in such
indemnified party’s reasonable judgment a conflict of interest between such
indemnified and indemnifying parties may exist with respect to such claim,
permit such indemnifying party to assume the defense of such claim with counsel
reasonably satisfactory to the indemnified party.  If such defense is assumed, the indemnifying
party shall not be subject to any liability for any settlement made by the
indemnified party without its consent (but such consent will not be
unreasonably withheld).  An indemnifying
party who is not entitled to, or elects not to, assume the defense of a claim
shall not be obligated to pay the fees and expenses of more than one counsel
for all parties indemnified by such indemnifying party with respect to such
claim, unless in the reasonable judgment of any indemnified party there may be
one or more legal or equitable defenses available to such indemnified party
which are in addition to or may conflict with those available to another
indemnified party with respect to such claim. 
Failure to give prompt written notice shall not release the indemnifying
party from its obligations hereunder.

 

(d)           The
indemnification provided for under this Agreement shall remain in full force
and effect regardless of any investigation made by or on behalf of the
indemnified party or any officer, director or controlling Person of such
indemnified party and shall survive the transfer of securities.

 

(e)           If the
indemnification provided for in or pursuant to this Section 10 is
due in accordance with the terms hereof, but is held by a court to be
unavailable or unenforceable in respect of any losses, claims, damages,
liabilities or expenses referred to herein, then each applicable indemnifying
party, in lieu of indemnifying such indemnified party, shall contribute to the
amount paid or payable by such indemnified Person as a result of such losses,
claims, damages, liabilities or expenses in such proportion as is appropriate
to reflect the relative fault of the indemnifying party on the one hand and of
the indemnified party on the other in connection with the statements or
omissions which result in such losses, claims, damages, liabilities or expenses
as well as any other relevant equitable considerations.  The relative fault of the indemnifying party
on the one hand and of the indemnified Person on the other shall be determined
by reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the indemnifying party or by the indemnified
party, and by such party’s relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.  In no event shall the liability of any
selling Holder be greater in amount than the amount of net proceeds received by
such Holder upon such sale or the amount for which such indemnifying party
would have been obligated to pay by way of indemnification if the 

 

14

 

indemnification
provided for under Section 10(a) or 10(b) hereof
had been available under the circumstances.

 

11.                               Participation
in Underwritten Registrations.

 

No
Person may participate in any registration hereunder which is underwritten
unless such Person (a) agrees to sell such Person’s securities on the
basis provided in any underwriting arrangements approved by the Person or
Persons entitled hereunder to approve such arrangements and (b) completes
and executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents required under the terms of such underwriting
arrangements.

 

12.                               Rule 144.

 

The
Company covenants that it will file the reports required to be filed by it
under the Securities Act and the Exchange Act and the rules and
regulations adopted by the SEC thereunder, and it will take such further action
as any Holder may reasonably request to make available adequate current public
information with respect to the Company meeting the current public information
requirements of Rule 144(c) under the Securities Act, to the extent
required to enable such Holder to sell Registrable Shares without registration
under the Securities Act within the limitation of the exemptions provided by (i) Rule 144
under the Securities Act, as such Rule may be amended from time to time,
or (ii) any similar rule or regulation hereafter adopted by the
SEC.  Upon the request of any Holder, the
Company will deliver to such Holder a written statement as to whether it has
complied with such information and requirements.

 

13.                               Miscellaneous.

 

(a)           Notices.  All notices, requests, consents and other
communications required or permitted hereunder shall be in writing and shall be
hand delivered or mailed postage prepaid by registered or certified mail or by
facsimile transmission (with immediate telephone confirmation thereafter),

 

	
  If
  to the Company:

  	
   

  
	
   

  	
   

  
	
  Baltic Trading Limited

  	
   

  
	
  299 Park Avenue, 20th Floor

  	
   

  
	
  New York, NY 10171

  	
   

  
	
  Attention: John C. Wobensmith, President and
  Chief Financial Officer

  
	
  Fax: (646) 443-8551

  	
   

  
	
   

  	
   

  
	
  If
  to the Stockholder:

  	
   

  
	
   

  	
   

  
	
  Genco Investments LLC

  	
   

  
	
  299 Park Avenue, 20th Floor

  	
   

  
	
  New York, NY 10171

  	
   

  
	
  Attention: John C. Wobensmith, Chief Financial
  Officer

  
	
  Fax: (646) 443-8551

  	
   

  

 

15

 

or
if to another Holder, to the addresses set forth on the counterpart signature pages of
this Agreement signed by such Holders.

 

If
to a transferee Holder, to the address of such Holder set forth in the transfer
documentation provided to the Company or at such other address as such party
each may specify by written notice to the others, and each such notice,
request, consent and other communication shall for all purposes of the Agreement
be treated as being effective or having been given when delivered personally or
upon receipt of facsimile confirmation if transmitted by facsimile, or, if sent
by mail, at the earlier of its receipt or 72 hours after the same has been
deposited in a regularly maintained receptacle for the deposit of United States
mail, addressed and postage prepaid as aforesaid.

 

(b)           No Waivers.  No failure or delay by any party in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof nor shall any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.  The rights and remedies herein provided shall
be cumulative and not exclusive of any rights or remedies provided by law.

 

(c)           Successors and
Assigns.  The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns, it being understood that
subsequent Holders of the Registrable Shares are intended third party
beneficiaries of this Agreement.

 

(d)           Other
Registration Rights.  Other
Registration Rights. The Company shall not grant to any Person the right, to
request the Company to register any securities of the Company except such rights
as are not more favorable than or inconsistent with the rights granted to the
Holders herein. In the event the Company grants rights which are more
favorable, the Company will make such provisions available to the Holders and
will enter into any amendments necessary to confer such rights on the Holders.

 

(e)           Governing Law.  The laws of the State of New York shall
govern the enforceability and validity of this Agreement, the construction of
its terms and the interpretation of the rights and duties of the parties,
without regard to the principles of conflicts of laws thereof.

 

(f)            Jurisdiction.  Any suit, action or proceeding seeking to
enforce any provision of, or based on any matter arising out of or in
connection with, this Agreement or the transactions contemplated hereby may be
brought in any federal or state court located in the County and State of New
York, and each of the parties hereby consents to the jurisdiction of such
courts (and of the appropriate appellate courts therefrom) in any such suit, action
or proceeding and irrevocably waives, to the fullest extent permitted by law,
any objection which it may now or hereafter have to the laying of the venue of
any such suit, action or proceeding in any such court or that any such suit,
action or proceeding which is brought in any such court has been brought in an
inconvenient forum.  Process in any such
suit, action or proceeding may be served on any party anywhere in the world,
whether within or without the jurisdiction of any such court.  Without 

 

16

 

limiting
the foregoing, each party agrees that service of process on such party as
provided in this Section 13(e) shall be deemed effective
service of process on such party.

 

(g)           Waiver of Jury
Trial.  EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.

 

(h)           Counterparts;
Effectiveness.  This
Agreement may be executed in any number of counterparts (including by
facsimile) and by different parties hereto in separate counterparts, with the
same effect as if all parties had signed the same document.  All such counterparts shall be deemed an
original, shall be construed together and shall constitute one and the same
instrument.  This Agreement shall become
effective when each party hereto shall have received counterparts hereof signed
by all of the other parties hereto.

 

(i)            Entire
Agreement.  This
Agreement contains the entire agreement among the parties hereto with respect
to the subject matter hereof and supersedes and replaces all other prior
agreements, written or oral, among the parties hereto with respect to the
subject matter hereof.

 

(j)            Captions.  The headings and other captions in this
Agreement are for convenience and reference only and shall not be used in
interpreting, construing or enforcing any provision of this Agreement.

 

(k)           Severability.  If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction or
other authority to be invalid, void or unenforceable, the remainder of the
terms, provisions, covenants and restrictions of this Agreement shall remain in
full force and effect and shall in no way be affected, impaired or invalidated
so long as the economic or legal substance of the transactions contemplated
hereby is not affected in any manner materially adverse to any party.  Upon such a determination, the parties shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner in order
that the transactions contemplated hereby be consummated as originally
contemplated to the fullest extent possible.

 

(l)            Amendments.  The provisions of this Agreement, including
the provisions of this sentence, may not be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not be
given without the prior written consent of the holders of a majority of the Registrable
Shares (as constituted on the date hereof); provided, however,
that without a Holder’s written consent no such amendment, modification,
supplement or waiver shall affect adversely such Holder’s rights hereunder in a
discriminatory manner inconsistent with its adverse effects on rights of other
Holders hereunder (other than as reflected by the different number of shares
held by such Holder); provided, further, that the consent or
agreement of the Company shall be required with regard to any termination,
amendment, modification or supplement of, or waivers or consents to departures
from, the terms hereof, which affect the Company’s obligations hereunder.  This Agreement cannot be changed, modified,
discharged or terminated by oral agreement.

 

17

 

(m)          Aggregation of
Shares.  All Registrable Shares held by
or acquired by any Affiliated Persons will be aggregated together for the
purpose of determining the availability of any rights under this Agreement.

 

(n)           Equitable
Relief.  Without limiting the remedies
available, the parties hereto acknowledge that any failure by the Company to
comply with its obligations under this Agreement will result in material
irreparable injury to the Holders for which there is no adequate remedy at law,
that it will not be possible to measure damages for such injuries precisely and
that, in the event of any such failure, any Holder shall have the right to
obtain such relief as may be required to specifically enforce the Company’s
obligations under this Agreement.

 

[Remainder of Page Intentionally Left Blank]

 

18

 

IN
WITNESS WHEREOF, this Agreement has been duly executed by each of the parties
hereto as of the date first written above.

 

 

	
   

  	
  BALTIC
  TRADING LIMITED

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  John C. Wobensmith

  
	
   

  	
  Name:

  	
  John
  C. Wobensmith

  
	
   

  	
  Title:

  	
  President
  and Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  GENCO
  INVESTMENTS LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  John C. Wobensmith

  
	
   

  	
  Name:

  	
  John
  C. Wobensmith

  
	
   

  	
  Title:

  	
  Chief
  Financial Officer

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