Document:

Exhibit 10.4

 

Loan No. 310629100

 

CONSTRUCTION LOAN AGREEMENT

 

AGREEMENT made this 24th
day of January, 2011, by and between Rockland Trust Company, a Massachusetts trust company with a place of business located
at 288 Union Street, Rockland, Massachusetts 02370 (the "Lender") and 109 LONG WHARF LLC, a Delaware limited liability
company with a mailing address c/o Phoenix Bulk Carriers, 88 Valley Road, Middletown, Rhode Island 02842 (the "Borrower").

 

I. DEFINITIONS

 

1.01. Certain Defined Terms.
In addition to the definitions contained in the foregoing recital clause, the following terms shall have the meanings provided
below:

 

"Agreement" means this
Agreement, as amended from time to time.

 

"Change Order" means any
change, amendment or modification to the Plans or the Construction Contract.

 

"Collateral" shall have
the meaning ascribed to that term in the Mortgage.

 

"Collateral Assignment"
means the Collateral Assignment of Leases and Rents by the Borrower to the Lender dated of even date.

 

"Completion" or "Completion
of the Improvements" shall mean the completion and payment of the Direct Costs and the Indirect Costs of all design, construction,
equipping, furnishing and tenant-fixturing of the Improvements, all clearing, landscaping, lighting and paving of the Premises,
and procurement of all approvals, licenses and permits necessary to make the same ready for use and occupancy, open the same to
the public and place the same in operation in order to convert, exchange, remortgage, rent, sell, use or otherwise dispose of the
Premises and Improvements, as a whole or in parts, so that the Loan can be repaid or refinanced on or before the maturity date
of the Note.

 

"Completion Date" shall
mean January 24, 2012.

 

"Construction Assignment"
shall mean the Assignment of Project Contracts by and between the Borrower and the Lender dated even date.

 

"Construction Consultant"
shall mean an independent qualified engineer or architect, selected by the Lender whose duties shall include analysis of the Plans
and Requisitions, monitoring progress on the construction of the Improvements, and other customary services incidental to the foregoing.

 

    	 

    	 

    

 

"Construction Contract"
shall mean that contract between the Borrower and the Contractor dated July 1, 2010 to provide, or supervise or manage the procurement
of, substantially all labor and materials needed for the construction of the Improvements.

 

"Construction Term" shall
mean the period commencing on the date hereof and ending on the Completion Date.

 

"Contractor" shall mean
The Damon Company, with a place of business located at 62 Warner Street, Newport, Rhode Island.

 

"Corporate Guarantor"
shall mean Bulk Partners (Bermuda) Ltd. 

 

"Default" means any of
the events specified in Article IX hereof which with the passage of time or giving of notice or both would constitute an Event
of Default.

 

"Direct Costs" shall mean
the aggregate costs of all labor, materials, equipment, fixtures and furnishings necessary for the Completion of the Improvements.
The initial projection of the Direct Costs appears on the Initial Project Cost Statement.

 

"Event of Default" means
an Event of Default described in Article IX hereof.

 

"GAAP" means generally
accepted accounting principles in the United States.

 

"Governmental Authorities"
means the United States, the state in which the Premises is located and any political subdivision, agency, department, commission,
board, bureau or instrumentality of either of them, including any local authorities, which exercise jurisdiction over the Premises
or the construction of the Improvements thereon.

 

"Guarantor" shall, jointly
and severally, mean Anthony Laura, Edward Coll and Bulk Partners (Bermuda) Ltd.

 

"Guaranty" shall collectively
mean the Guaranties of the Guarantor dated of even date.

 

"Hazardous Waste Laws"
shall mean any federal, state or local law governing the existence, release, generation, storage or disposal of any Hazardous Waste
now or hereafter existing.

 

"Hazardous Waste" shall
mean any "oil," "hazardous material," "hazardous wastes" or "hazardous substances" as defined
in the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. §9601 et seq., as amended,
or any similar statute, and the regulations adopted pursuant thereto and shall include without limitation (whether or not included
in the definition contained in said laws), petroleum, solvents, asbestos and other chemicals which would be materially dangerous
to the environment or to human beings.

 

"Improvements" shall mean
a building or buildings of office space and all related facilities, improvements and fixtures to be renovated on the Premises.

 

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"Indebtedness" means, for
the Borrower (i) all indebtedness or other obligations of the Borrower for borrowed money or for the deferred purchase price of
property or services, (ii) all indebtedness or other obligations of any other Person for borrowed money or for the deferred purchase
price of property or services the payment or collection of which the Borrower has guaranteed (except by reason of endorsement for
collection in the ordinary course of business) or in respect of which the Borrower is liable, contingently or otherwise, including,
without limitation, liable by way of agreement to purchase, to provide funds for payment, to supply funds to or otherwise to invest
in such other Person, or otherwise to assure a creditor against loss, (iii) all indebtedness or other obligations of any other
Person for borrowed money or for the deferred purchase price of property or services secured by (or for which the holder of such
indebtedness has an existing right, contingent or otherwise, to be secured by) any mortgage, deed of trust, pledge, lien, security
interest or other charge or encumbrance upon or in property (including, without limitation, accounts and contract rights) owned
by the Borrower, whether or not the Borrower has assumed or become liable for the payment of such indebtedness or obligations and
(iv) capitalized lease obligations of the Borrower.

 

"Indirect Costs" shall
mean all costs of Completion of the Improvements other than Direct Costs, including but not limited to, architects' fees, attorneys'
fees, interest, real estate taxes, survey costs, accounting fees and title insurance premiums. The initial projection of the Indirect
Costs appears on the Initial Project Cost Statement.

 

"Individual Guarantor"
shall, jointly and severally, mean Anthony Laura and Edward Coll.

 

"Initial Advance" shall
mean the first advance to be made hereunder, which may be contemporaneous with or subsequent to the time of the execution and delivery
by the Borrower and the Lender of this Agreement.

 

"Initial Project Cost Statement"
means the projection of, among other things, the Direct Costs and the Indirect Costs as set forth in Exhibit A attached
hereto and made a part hereof.

 

"Leases" means any and
all leases with respect to the Premises including the lease with Phoenix Bulk Carriers (US) LLC.

 

"Loan" shall mean the loan
of up to One Million Forty-Eight Thousand Dollars ($1,048,000) from the Lender to the Borrower.

 

"Major Subcontracts" shall
mean the subcontracts of each and every subcontractor or material supplier whose bid represents 10% or more of the total costs
of Completion of the Improvements and a sufficient number of subcontractors' and material suppliers' contracts whose bids collectively
represent not less than 70% of the total costs of Completion of the Improvements.

 

"Mortgage" shall mean the
Open-End Mortgage and Security Agreement by the Borrower to the Lender dated even date.

 

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"Note" shall mean the Borrower's
secured promissory note in the form attached hereto as Exhibit B, which Note is hereby incorporated herein by reference
and made a part hereof.

 

"Obligations" means all
obligations and all liabilities of the Borrower under this Agreement, the Note and the Security Documents.

 

"Permitted Encumbrances"
shall mean those encumbrances, if any, permitted by the Lender on the property of the Borrower as set forth in Exhibit C
attached hereto and incorporated herein by reference.

 

"Person" means and includes
an individual, a partnership, a joint venture, a corporation, a trust, an unincorporated organization and a government or any department
or agency thereof.

 

"Plans" means all preliminary
and final drawings, plans, specifications and other documents (including but not limited to complete architectural, structural,
mechanical, electrical and sprinkler system) prepared by the Borrower or the Contractor and approved by the Lender and the Construction
Consultant which describe and show the materials, equipment, fixtures and furnishings necessary for the construction of the Improvements,
including all amendments and modifications thereof made by approved Change Orders and also showing minimum grade of finishes and
furnishings for all areas of the Improvements to be leased or sold in ready-for-occupancy condition.

 

"Premises" means that certain
parcel of land, with all buildings and improvements now or hereafter situated thereon, located at 109 Long Wharf, Newport, Rhode
Island and more particularly described in the Mortgage.

 

"Project Proceeds" shall
mean the monies and proceeds derived by the Borrower or its affiliates from the Premises or the Improvements prior to the repayment
of the Loan, including any reimbursements for tenant work done by the Borrower, tax refunds, refunds or rebates from contractors
or suppliers, performance bond and insurance proceeds, condemnation awards and capital contributions or loans by such affiliates
or other Persons or entities but excluding tenant security deposits, rentals and any ordinary and necessary costs or expenses
of raising or collecting such monies and proceeds.

 

"Requisition" means a statement
by the Borrower and, in the case of a Direct Cost requisition, by the Borrower and the Contractor, in the forms acceptable to the
Lender setting forth the amount of the Loan advance requested in each instance.

 

"Retainage" shall mean
the retention by the Lender of five percent (5%) of the funds to be advanced under a Direct Cost Requisition pending the Completion
of the Improvements.

 

"Security Documents" means
the Mortgage, the Guaranty, the Collateral Assignment, the Construction Assignment and any other agreement or instrument now or
hereafter securing the Note.

 

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"Site Assessment Report"
shall mean an environmental site assessment report prepared by a qualified environmental engineer satisfactory to the Lender indicating
that no Hazardous Waste is or has been present on the Premises or areas adjacent to the Premises and containing evidence satisfactory
to the Lender that no "notice of responsibility" or other order has been issued by the United States Environmental Protection
Agency against the Borrower or the Premises.

 

1.02. Defined LIBOR Terms.

 

“Hedging Contracts”
means the ISDA Master Agreement and Schedule thereto, and any swap agreements, as defined in 11 U.S.C. §101, entered into
pursuant to said ISDA Master Agreement and Schedule thereto. Any prepayment, acceleration, reduction, increase or any change in
the terms of the Note will not alter the notional amount of such interest rate swap transactions, which will remain in full force
and effect notwithstanding any such prepayment, acceleration, reduction, increase or change, subject to the terms of such interest
rate swap transactions.

 

“Interest Rate”
shall mean the rate at which interest shall accrue on the unpaid principal balance of the Note during each Interest Period from
the date hereof at a rate per annum equal to 1-month LIBOR plus two hundred eighty-five (285) basis points per annum, adjusted
monthly, subject to the Hedging Contracts, as hereinafter defined.

 

“Interest Period”
shall mean each period commencing on and including the date an interest payment is due as provided in the payment schedule in the
Note and ending on but excluding the date the next interest payment is due, with the first Interest Period commencing on the day
of closing. Upon determination by the Lender of the Interest Rate for any Interest Period, such Interest Rate shall remain in effect
for the entire Interest Period until redetermined for the next successive Interest Period.

 

“LIBOR” is
the rate for U.S. dollar deposits with a maturity equal to one month, and reported on Reuters Screen LIBOR01 as of 11:00 a.m. London
time, on the day that is two (2) London business days prior to beginning of the applicable Interest Period. Interest shall be computed
based upon a year consisting of twelve (12) months of thirty days each. If for any reason, LIBOR ceases to be available, then interest
shall accrue upon the unpaid principal balance of the Note during each Interest Period at a rate equal to one and one-half percent
(1.5%) per annum above the Prime Lending Rate in effect upon the commencement of (or is such day is not a business day, the last
business day before) each applicable Interest Period.

 

"Prime Lending Rate"
shall mean the rate listed in the Wall Street Journal as the so-called national "prime rate", but if no such designation
is published, the term shall mean the nearest equivalent to such term as published by the Wall Street Journal (as determined by
the Lender), or if no equivalent is published by the Wall Street Journal, by another financial publication of national standing.
The so-called Prime Lending Rate is a rate for reference purposes only and is not necessarily the lowest rate offered by the Lender.

 

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1.03. LIBOR Provisions. (a)
The Borrower shall hedge the floating interest expense of the Loan evidenced by the Note by maintaining one or more interest rate
swap agreements in an aggregate notional amount equal to the principal balance of the Note outstanding over such term that the
hedge is executed and providing for a fixed rate acceptable to Lender, with the Borrower making fixed rate payments and receiving
floating rate payments to offset changes in the variable interest expense of the Note, all upon such terms and conditions as shall
be acceptable to Lender. To establish this interest rate hedge, the Borrower and the Lender have entered into the Hedging Contracts.

 

(b) The Borrower hereby warrants and represents
that it has received and reviewed the Derivative Risk Disclosure provided to the Borrower by the Lender. Borrower warrants and
represents that it knows and understands the risks associated with the transactions contemplated by the Hedging Contracts, and
has consulted with or had the opportunity to consult with legal, tax and accounting advisors regarding such risks.

 

1.04. Accounting Terms. All
accounting terms not specifically defined herein shall be construed in accordance with GAAP consistent with those applied in the
preparation of all financial data submitted pursuant to this Agreement and prepared in accordance with GAAP.

 

II. GENERAL TERMS

 

2.01. Amount of Loan. The
Borrower has applied to the Lender for the Loan and the Lender has agreed to make the Loan to the Borrower subject to all the terms
and conditions of this Agreement.

 

2.02. Note. The borrowing
is to be evidenced by the Note.

 

2.03. Payments. The Borrower
shall make payments to the Lender in immediately available funds, as and when required by the Note.

 

2.04. Security for the Note.
The Note shall be secured by the Security Documents and by such additional security as shall be agreed to by the Lender and the
Borrower from time to time.

 

2.05. Advances. Subject to
the provisions of this Agreement, the Lender will advance and the Borrower will accept the Loan in installments as follows: The
Initial Advance will be made upon the satisfaction of the applicable conditions set forth in Article IV hereof relevant thereto,
and all subsequent advances shall be made not more frequently than monthly thereafter, upon the satisfaction of the applicable
conditions set forth in Article V hereof, in amounts which shall be equal to the aggregate of the Direct Costs and the Indirect
Costs incurred by the Borrower through the end of the period covered by the Requisition less:

 

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(i) The Retainage until the Project
is fifty percent (50%) complete, at which time the Retainage may be eliminated; and

 

(ii) The total of the Loan advances
theretofore made by the Lender;

 

and, at the election of the Lender, less
any combination of the following further amounts:

 

(iii) The entire amount by which
any Direct Costs or Indirect Costs are (or are estimated by the Lender to be) greater than the amounts set forth on the Initial
Project Cost Statement for such costs; and/or

 

(iv) Any costs covered by the
Requisition not approved, certified or verified as provided in Section 2.06 below, any Indirect Costs covered by a previous
Requisition for which proof of payment has not been received by the Lender, and/or any Direct Costs covered by a previous
Requisition for which payment receipts have not been received by the Construction Consultant and/or the Lender; and/or

 

(v) Any real estate taxes, mechanics'
liens, security interests, claims or other charges against the Premises or the Improvements and any interest, fees or other costs
which the Borrower may have failed to pay in accordance with this Agreement, the Note or the Security Documents.

 

2.06. Certification of Direct Costs.
All Direct Costs are to be certified by the Contractor and verified by the Construction Consultant. Verification of the monthly
progress and Direct Costs of construction of the Improvements which have been incurred by the Borrower from time to time and the
estimated total Direct Costs of construction of the Improvements from time to time may be made by the Construction Consultant in
his sole discretion. Both the Direct Costs and the Indirect Costs are to be approved by the Lender and may also be verified by
the Lender from time to time.

 

2.07. Location of Advances and Deposit
Thereof. All advances are to be made from the principal office of the Lender or from such other place as the Lender may
designate. Requisitions shall be received five (5) business days prior to the date of the requested advance. Such advance shall
be made to or deposited in a separate bank account with the Lender which shall (a) be the depository for all advances made hereunder
and (b) not be drawn upon except to pay (or to reimburse the Borrower if previously paid) for Direct Costs and Indirect Costs approved
by the Lender.

 

2.08. Last Advance. Amounts
not advanced pursuant to paragraph (a)(i) of Section 2.05 during the course of construction of the Improvements shall be advanced
upon the satisfaction of the conditions set forth in Section 5.02 hereof for the receipt of the last advance for Direct Costs.
Loan budget amounts for Indirect Costs not advanced prior to Completion of the Improvements shall be advanced until exhausted,
not more frequently than once a month, for the Indirect Costs as incurred after such Completion.

 

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2.09. Building Material Advances.
The Lender shall not be required to make any advances for building materials or furnishings which are not stored on the Premises
or which are stored on the Premises but not affixed to or incorporated in the Improvements; provided, however, the Lender may make
advances for such materials if (a) they are stored on the Premises or in a bonded warehouse, (b) they are covered by adequate insurance,
(c) they are adequately protected against theft and damage and (d) the Construction Consultant confirms the foregoing and recommends
such disbursements.

 

2.10. Acceleration of Advances.
If the Lender considers that its best interests and the best interests of Completion of the Improvements lies in accelerating the
amounts to be advanced pursuant to paragraph (a) of Section 2.05 hereof, it shall be entitled to do so and no Person dealing with
the Borrower or the Contractor or any other Person shall have standing to demand any different performance from the Lender. The
Lender may also disburse proceeds of the Loan, at its option, directly to the Contractor and/or subcontractors.

 

2.11. Reallocation of Loan Budget
Amounts. If at any time during the existence of this Agreement the undisbursed balance of the Loan budget amount for any
category of cost shown on the Initial Project Cost Statement is, in the Lender's sole judgment, excessive, the excess may be reallocated
to any other Loan budget amount balance which is deemed by the Lender to be insufficient.

 

2.12. Insufficient Loan Proceeds.
If at any time (which may include the execution of this Agreement and the inception of the Loan), and from time to time, the Lender
shall determine that the Loan, or the undisbursed balance thereof, is insufficient to cover the remaining costs of Completion of
the Improvements, then to further secure payment, the Lender may require the Borrower to pay sufficient funds to the Lender to
cover the Completion of the Improvements.

 

2.13. Permanent Phase of Loan.
On January 24, 2012, the Loan shall continue for the term and subject to the conditions and requirements as stated in the Note,
and all of the representations, warranties, covenants and agreements of the Borrower stated herein shall continue until payment
in full of all principal, interest and charges due under the Note and hereunder.

 

2.14. Forced-Funding. Loan
proceeds which are not advanced in accordance with the Loan Disbursement Schedule attached hereto as Exhibit D and incorporated
herein by reference shall be forced funded and disbursed into an interest earning deposit account with the Lender. Advances drawn
from this account shall bear interest at the same rate as all other Advances. Disbursements of funds from such forced-funded deposit
account will occur on the same terms and conditions as established by this Agreement for construction draws. The forced funded
deposit account shall serve as collateral for the Loan. All interest earned on the forced funded deposit account will, if the Loan
is not in Default, accrue to the Borrower. By executing this Agreement, the Borrower hereby directs and authorizes the Lender to
force-fund the account if necessary and no further direction or authorization from Borrower shall be necessary with respect to
such advances, and all such advances shall be secured by the Security Documents.

 

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2.15. Participations. The
Lender reserves the right without notice to the Borrower to sell participations in the Loan, in whole or in part, provided that
the Borrower's rights under this Agreement will not be modified thereby. Furthermore, the Lender shall have the right to make available
to actual or potential participants all financial information, public or non-public, that the Lender receives from the Borrower.

 

2.16. Environmental Condition.
The Borrower and Lender acknowledge that the Premises is governed by an environmental land use restriction (“ELUR”).
The Borrower shall, at all times comply with the requirements of the Rhode Island Department of Environmental Management, during
and after construction of the improvements (as further set forth in Section 5.02(d)) and the Borrower shall further comply with
the terms of the ELUR by providing the Bank with a copy of the required annual inspection report as it is submitted to the Department
of Environmental Management.

 

III. REPRESENTATIONS AND WARRANTIES

 

To induce the Lender to enter into this
Agreement and make the Loan, the Borrower represents and warrants to the Lender (which representations and warranties shall survive
the delivery of the Note and the making of the Loan) that:

 

3.01. Financial Statements.
All financial statements previously furnished by the Borrower to the Lender have been prepared in accordance with GAAP applied
on a basis consistent with that of preceding periods, are complete and correct, and fully and accurately reflect the financial
condition of the Borrower as of said dates, and the results of its operations for the period stated. To the best of the Borrower's
knowledge and belief, the Borrower does not have any contingent obligations, liabilities for taxes, unusual long-term commitments
or lease commitments except as specifically mentioned in such financial statements or the notes thereto. Since the date of the
most recent financial statements submitted to Lender there has been no material adverse change in the financial condition of the
Borrower.

 

3.02. Organization and Qualification.
 The Borrower (i) is duly organized, validly existing and in good standing under the laws of its state of organization, (ii)
has the power and authority to own its properties and to carry on business as now being conducted and is qualified to do business
in every jurisdiction where such qualification is necessary and (iii) has the power to execute and deliver this Agreement, to borrow
hereunder and to execute and deliver to the Lender the Note, the Security Documents and any other instruments required hereunder.

 

3.03. No Conflict. (a) The
Borrower has taken all necessary action to authorize the borrowings on the terms and conditions of this Agreement and to authorize
the execution, delivery and performance of this Agreement, the Note, the Security Documents and any other agreements referred to
herein or related to the Loan.

 

(b) All consents, licenses, approvals or authorizations
of, or registrations or declarations with, any Governmental Authorities, bureaus or agencies which are required in connection with
the execution, delivery, performance, validity or enforceability of this Agreement, the Note and any other agreements referred
to herein have been duly obtained and are in full force and effect.

 

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(c) The execution, delivery and performance
of this Agreement, the Note, the Security Documents and any other agreement referred to herein will not be in conflict with, result
in a breach of, or constitute (with due notice or lapse of time or both) a default under, any provision of any existing law or
regulation or of any order or decree of any courts or Governmental Authorities, bureaus or agencies or of the Articles of Organization
or Operating Agreement of the Borrower or of any mortgage, indenture, contract or other agreement to which the Borrower is a party
or which purports to be binding upon it or upon any of its properties or assets, and will not result in the creation or imposition
of any lien, charge or encumbrance on, or security interest in, any of its properties or assets, except in favor of the Lender.

 

3.04. Litigation. There is
no action, suit or proceeding at law or in equity or by or before any Governmental Authorities or other agencies now pending or,
to the knowledge of the Borrower, threatened against or affecting the Borrower which, if adversely determined, would have a material
adverse effect on the business operations, properties, assets or condition (financial or otherwise) of the Borrower. The Borrower
is not in default with respect to any order of any courts, arbitrators or Governmental Authorities arising out of any action, suit
or proceeding under any statute or other law.

 

3.05. No Default.  The Borrower
is not a party to any agreement or instrument or subject to any restriction adversely affecting its business, properties or assets,
operations or conditions, financial or otherwise. The Borrower is not in default in the performance, observance or fulfillment
of any of the obligations, covenants or conditions contained in any agreement or instrument to which it is a party or by which
its assets may be bound, and no Default or Event of Default as hereinafter specified has occurred and is continuing hereunder.

 

3.06. Properties. The Borrower
has good title to, or valid leasehold interests in, all of its properties and assets, real and personal, including the Premises,
free and clear of all mortgages, liens and encumbrances, except for the Permitted Encumbrances.

 

3.07. Taxes. The Borrower
has filed or caused to be filed all tax returns required to be filed, and has paid all taxes shown to be due and payable on said
returns or on any assessments made against it, and no tax liens have been filed and no claims are being asserted, or proposed or
threatened to be asserted, with respect to any taxes which are not reflected in the financial statements referred to in Section
3.01 hereof, and the Borrower is currently providing adequate reserves for all current taxes.

 

3.08. No Pending Insolvency.
Any funds advanced to the Borrower under this Agreement do not and will not render the Borrower insolvent; the Borrower is not
contemplating either the filing of a petition under any state or federal bankruptcy or insolvency laws or the liquidation of all
or a major portion of its property and the Borrower has no knowledge of any Person contemplating the filing of any such petition
against it, and none of such properties and assets owned by the Borrower is subject to any mortgage, security interest, pledge,
lien, charge, encumbrance or title retention or other security agreement or arrangement of any nature whatsoever, except for the
Permitted Encumbrances.

 

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3.09. Statements. No statement
of fact made by or on behalf of the Borrower in this Agreement or in any certificate or schedule furnished to the Lender pursuant
hereto, contains any untrue statement of a material fact or omits to state any material fact necessary to make the statements contained
therein or herein not misleading. There is no fact presently known to the Borrower which has not been disclosed to the Lender which
materially affects adversely nor as far as the Borrower can foresee, will materially affect adversely the property, business, prospects
or condition (financial or otherwise) of the Borrower.

 

3.10. Legally Enforceable Agreement.
This Agreement, the Note, the Security Documents and any other documents executed by the Borrower in connection with the Loan,
are the legal, valid and binding obligations of the Borrower, enforceable against the Borrower in accordance with their respective
terms, except to the extent that such enforcement may be limited by applicable bankruptcy, insolvency and similar laws affecting
creditors' rights generally and except as certain remedies thereunder may be subject to equitable principles.

 

3.11. Regulation U. The Borrower
is not engaged principally, or as one of the Borrower's important activities, in the business of extending credit for the purpose
of purchasing or carrying margin stock (within the meaning of Regulation U of the Board of Governors of the Federal Reserve System),
and will not use the proceeds of the Loan so as to violate Regulation U as it may be amended or interpreted from time to time by
the Board of Governors of the Federal Reserve System.

 

3.12. Plans. The Plans are
satisfactory to the Borrower, have been reviewed and approved by the Guarantor, the Contractor, the tenants under any Leases which
require approval of the Plans and, to the extent required by applicable law or any effective restrictive covenant, by all Governmental
Authorities and the beneficiary of any such covenant, respectively. The Plans so approved have been initialed by the Borrower and
the Contractor. All construction, if any, already performed on the Improvements has been performed within the perimeter of the
Premises in accordance with the Plans approved by the Persons named above and with any restrictive covenants applicable thereto.
There are no structural defects in the Improvements or violations of any requirement of any Governmental Authorities with respect
thereto; the planned use of the Improvements complies with applicable zoning ordinances, regulations and restrictive covenants
affecting the Premises as well as all environmental, ecological, landmark and other applicable laws and regulations; and all requirements
for such use have been satisfied.

 

3.13. Utilities. All utility
services necessary for the construction of the Improvements and the operation thereof for their intended purposes are available
at the boundaries of the Premises, including, without limitation, water supply, fire protection, storm and sanitary sewer, gas,
electric power and telephone facilities, and are of sufficient capacity to service adequately the Improvements and all necessary
governmental regulatory consents to the connecting of such facilities to the Improvements (when constructed) have been obtained
(which consents are not on a "stand-by" basis).

 

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3.14. Roads. All roads necessary
for the full utilization of the Improvements for their intended purposes have either been completed or the necessary rights of
way therefor have been acquired by the appropriate Governmental Authorities or dedicated to public use and accepted by the Governmental
Authorities, and all necessary steps have been taken by the Borrower and the Governmental Authorities to assure the complete construction
and installation thereof no later than the Completion Date or any earlier date required by any law, order or regulation or Lease.

 

3.15. Leases. The Leases are
in full force and effect, there are no defaults under any of the provisions thereof and all conditions to the effectiveness and
continuing effectiveness thereof required to be satisfied as of the date hereof have been satisfied.

 

3.16. No Violation; Approvals.
Construction of the Improvements will not violate the Permitted Encumbrances nor any zoning, environmental, building code, subdivision
or land use ordinance, regulation or law. No approvals are required by the U.S. Environmental Protection Agency or the Department
of Housing and Urban Development under the Flood Disaster Act of 1973.

 

3.17. Brokerage Commissions.
The making of the Loan or the Lender's acquisition of the Note or any of the Security Documents will not subject the Lender to
any claim for a brokerage commission.

 

IV. CONDITIONS OF MAKING THE INITIAL
ADVANCE

 

The obligation of the Lender to make the
Initial Advance hereunder is subject to the following conditions precedent:

 

4.01. Representations. The
representations and warranties set forth in Article III hereof shall be true and correct on and as of the date hereof and the date
that each advance under the Loan is made.

 

4.02. Certification. The Borrower
shall have executed and delivered to the Lender, upon the execution of this Agreement, the following: (a) a Certificate of the
Members of the Borrower certifying the Votes of the Members authorizing the execution and delivery of this Agreement, the Note,
the Security Documents and any other documents related to the Loan, and (b) such other supporting documents as the Lender may reasonably
request.

 

4.03. Legal Opinion. The Lender
shall have received the favorable written opinion of Corcoran, Peckham, Hayes and Galvin PC, counsel for the Borrower, dated the
date of the Loan, satisfactory to the Lender and its counsel in scope and substance, with respect to, among other things, the matters
set forth in Sections 3.02, 3.03, 3.04 and 3.05.

 

4.04. Good Standing. The Lender
shall have received for the Borrower Certificates of Good Standing from the Delaware Secretary of State.

 

4.05. Legal Matters. All legal
matters incident to the transactions hereby contemplated shall be satisfactory to counsel for the Lender.

 

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4.06. Commitment Letter. There
shall be compliance with all terms of the commitment letter of the Lender to the Borrower dated December 29, 2010.

 

4.07. No Material Damage.
The Improvements, if any, shall not have been materially injured or damaged by fire or other casualty.

 

4.08. First Requisition. The
Lender shall have received a Requisition for the Initial Advance, together with proof of payment of the Indirect Costs for which
the advance is requested.

 

4.09. Title Continuation.
The Lender shall have received a title continuation report of the title policy to the date of the Initial Advance in a form approved
by the Lender and the Lender's counsel containing a pending disbursements provision and setting forth no additional exceptions
except those approved in writing by the Lender and its counsel.

 

4.10. No Default There shall
be no Default under this Agreement or the Security Documents at the time of the Initial Advance.

 

4.11. Direct Costs. If the
Initial Advance shall consist of advances for Direct Costs (in addition to Indirect Costs) or be solely for Direct Costs, or if
Direct Costs shall have theretofore been incurred even though not included within the Initial Advance, the Construction Consultant
shall have received and approved copies of (l) the Requisition, (2) the Construction Contract, and (3) all Change Orders which
are in effect as of the date of such Requisition.

 

4.12. Documents To Be Delivered To
The Lender. The items to be delivered to the Lender prior to the Initial Advance shall be:

 

(a) The commitment fee, to be retained by
Lender whether or not any advances are made under this Agreement.

 

(b) The Construction Consultant's fees and
expenses and Lender's counsel fees and expenses.

 

(c) Current financial statements and such
other financial statements as the Lender shall require.

 

(d) An appraisal of the value of the Premises
and the Improvements to be built thereon.

 

(e) Advice from the Construction Consultant
to the effect that (l) the Plans have been approved by him and by the Governmental Authorities, (2) a Construction Contract and/or
Major Subcontracts are in effect which satisfactorily provide for the Completion of the Improvements, (3) all utilities necessary
for the full utilization of the Improvements for their intended purposes have been completed or the presently installed and proposed
utilities will be sufficient for the full utilization of the Improvements for their intended purpose, and (4) in his opinion the
construction of the Improvements theretofore performed was performed in accordance with the Plans and will be finished along with
all necessary roads and utilities on or before the Completion Date.

 

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(f) The executed Note.

 

(g) The executed Security Documents.

 

(h) The policies of hazard insurance required
by the Security Documents, accompanied by evidence of the payment of the premiums therefor, which policies shall contain an endorsement
specifically providing that, in the case of any damage, the entire insurance proceeds will be paid to the Lender so long as it
certifies to the insurer that the unpaid principal amount of the Loan equals or exceeds the proceeds of insurance.

 

(i) A paid title insurance policy, or commitment
therefor, in American Land Title Association form, approved by the Lender, from a title insurer acceptable to the Lender, for the
amount of the Note, insuring the Mortgage to be a valid first lien on the Borrower's interest in the Premises free and clear of
all defects, encumbrances and exceptions except such as the Lender and its counsel shall approve, and shall contain:

 

(i) full coverage against mechanics' and materialmen's
liens;

 

(ii) a reference to the survey but no survey exceptions
except those theretofore approved in writing by Lender and its counsel; and

 

(iii) a pending disbursement clause in a form approved
by the Lender.

 

(j) A copy of the current survey of the Premises.

 

(k) Filed Uniform Commercial Code financing
statements to perfect the security interest created by the Security Documents in the personalty, fixtures and other property described
therein.

 

(l) A progress schedule or chart showing the
interval of time over which each item of Direct Cost is projected to be incurred or paid.

 

(m) The Initial Project Cost Statement.

 

(n) Certified copies of all authorizations
including plot plan approvals, subdivision approvals, sewer permits and zoning variances, if any, building and other permits required
by any Governmental Authorities for the construction, use, occupancy and operation of the Premises and/or the Improvements for
the purposes contemplated by the Plans in accordance with all applicable building, environmental, ecological, landmark, subdivision
and zoning codes, laws and regulations, which are presently procurable.

 

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(o) A current title report from the title
insurer which shall set forth a legally sufficient description of the Premises, copies of all instruments which appear as exceptions
in the report, any liens which have been previously discharged by bonding, court deposit or other means other than full payment,
the status of the title to abutting streets and roads, and any UCC filings against the Borrower or other owner of the Premises;
and advice from the title insurer to the effect that searches of proper public records disclose no leases of personalty or financing
statements filed or recorded against the Premises or the Borrower, or owner of any of the property which is the subject of the
Security Documents.

 

(p) Copies of the Construction Contract and
all riders, addenda and other instruments referred to therein as "contract documents," certified by the Borrower to be
true and complete and copies of Major Subcontracts so certified.

 

(q) such other matters as the Lender or its
counsel may reasonably request.

 

(r) Lien releases or affidavits from, or the
submission of other appropriate forms by, suppliers, the Contractor, subcontractors or materialmen as the Lender may deem desirable.

 

(s) The Site Assessment Report.

 

4.13. Documents To Be Delivered To
The Construction Consultant. The items to be delivered to the Construction Consultant prior to the Initial Advance shall
be:

 

(a) Copies of a site plan (showing all necessary
approvals, utility connections and site improvements) and the Plans.

 

(b) A copy of the current survey of the Premises.

 

(c) Copies of the Construction Contract and
any Major Subcontracts

 

(d) A statement of Direct Costs.

 

(e) Copies of any Leases containing any requirements
or specifications for the construction of the Improvements.

 

(f) Copies of the authorizations, approvals,
permits and other documents referred to in paragraph (n) of Section 4.12.

 

(g) A project progress schedule showing the
interval of time over which each item of Direct Cost is projected to be incurred or paid.

 

V. CONDITIONS OF MAKING ADVANCES

AFTER THE INITIAL ADVANCE

 

5.01. Conditions Precedent.
The Lender's obligation to make Loan advances after the Initial Advance shall be subject to the satisfaction of the following conditions:

 

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(a) All conditions of Article IV shall remain
satisfied, performed and unimpaired as of the date of each such subsequent advance.

 

(b) If the advance shall consist of disbursements
for Direct Costs, the Construction Consultant and the Lender shall have received, as of the date of the advance, the items required
by Section 4.12 and such other documentation and information (including but not limited to the progress schedule) as the Construction
Consultant or the Lender may require.

 

(c) The Lender shall have received a Requisition
for the advance.

 

(d) The Lender shall have received a title
continuation report of the title policy to the date of such advance, in the form approved by the Lender's counsel, including, but
not limited to, the pending disbursements clause and setting forth no additional exceptions except those approved in writing by
the Lender and its counsel.

 

(e) The representations and warranties set
forth in Article III hereof shall be true and correct on and as of the date of the advance with the same effect as if made on such
date.

 

(f) There shall be no Default under this Agreement
or the Security Documents as of the date of such advance.

 

5.02. Last Advance. In the
case of the last Loan advance as provided in Section 2.08 and prior to converting to the Permanent Phase of the Loan, the Lender
shall also have received:

 

(a) Evidence of (i) approval by all Governmental
Authorities of the Completion of the Improvements in their entirety and the issuance of a certificate for the permanent occupancy
thereof to the extent any such approval is a condition of the lawful use and occupancy of the Improvements for the contemplated
uses, (ii) such approval by the State Fire Marshall or its equivalent, and (iii) the approval of the contemplated uses thereof
by all Governmental Authorities.

 

(b) Advice from the Construction Consultant
to the effect that all design, site, construction and finishing work necessary for the Completion of the Improvements and any necessary
utilities and roads have been finished and made available for use in accordance with the Plans.

 

(c) An affidavit of the Borrower that no work
has been performed or materials supplied for the Improvements for more than two hundred (200) days or lien releases or affidavits
from, or the submission of other appropriate forms by, suppliers, the Contractor, subcontractors or materialmen as the Lender may
deem desirable.

 

(d) Evidence to the Lender that the Borrower
is in full compliance with the ELUR requirements associated with the Premises. This requirement shall include delivery to the Lender
of a copy of the “ELUR Remedial Action Closure Report” and subsequent “Letter of Compliance” to be issued
by the Rhode Island Department of Environmental Management.

 

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VI. AFFIRMATIVE COVENANTS

 

The Borrower covenants and agrees that,
from the date hereof and until payment in full of the principal of, and interest on, the Note and any other Indebtedness of the
Borrower to the Lender, whether now existing or arising hereafter, unless the Lender shall otherwise consent in writing, the Borrower
will:

 

6.01. Maintenance of Properties; Insurance.
(a) Do or cause to be done all things necessary to preserve, renew and keep in full force and effect its rights, licenses, permits
and franchises and comply with all laws and regulations applicable to it; at all times maintain, preserve and protect all franchises
and trade names and preserve all the remainder of its property used or useful in the conduct of its business and keep the same
in good repair, working order and condition, and from time to time, make, or cause to be made, all needful and proper repairs,
renewals, replacements, betterments and improvements thereto, so that the business carried on in connection therewith may be properly
and advantageously conducted at all times; and maintain insurance in accordance with the requirements of the Security Documents.

 

(b) Comply with all applicable laws and regulations,
whether now in effect or hereafter enacted or promulgated by any Governmental Authorities having jurisdiction over the property
which is the subject of the Security Documents.

 

6.02. Payment of Obligations and Taxes.
Pay and discharge or cause to be paid and discharged all of its obligations and liabilities and all taxes, assessments and governmental
charges or levies imposed upon it or upon its respective income and profits or upon any of its property, real, personal or mixed,
or upon any part thereof, before the same shall become in default, as well as all lawful claims for labor, materials and supplies
or otherwise, which, if unpaid, might become a lien or charge upon such properties or any part thereof; provided that the Borrower
shall not be required to pay and discharge or cause to be paid and discharged any such tax, assessment, charge, levy or claim so
long as the validity thereof shall be contested in good faith by appropriate proceedings and it shall have set aside on its books
adequate reserves with respect to any such tax, assessment, charge, levy or claim, so contested; and provided, further, that payment
with respect to any such tax, assessment, charge, levy or claim shall be made within ten (10) days after entry of final judgment
and before any of its property shall be seized or sold in satisfaction thereof.

 

6.03. Legal Proceedings. Give
prompt written notice to the Lender of any proceedings instituted against it in any Federal or state court or before any commission
or other regulatory body, Federal, state or local, which, if adversely determined, would have an adverse effect upon its business,
operations, properties, assets, or condition, financial or otherwise.

 

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6.04. Books, Records and Reports.
At all times keep proper books of record and accounts in which full, true and correct entries will be made of its transactions
in accordance with GAAP and in a manner satisfactory to the Lender. The Borrower hereby authorizes the Lender to make or cause
to be made, at the Borrower's expense and in such reasonable manner and at such reasonable times as the Lender may require:

 

(a) Inspections and audits of any books, records
and papers in the custody or control of the Borrower or others, relating to the Borrower's financial or business conditions, including
the making of copies thereof and extracts therefrom, and

 

(b) Inspections and appraisals of any of the
Borrower's assets.

 

6.05. Financial Statements.
Furnish to the Lender:

 

(a) Within one hundred twenty (120) days of
the end of each fiscal year, management prepared financial statements of Borrower in form and substance reasonably satisfactory
to the Lender;

 

(b) Within thirty (30) days of filing but
not later than one hundred twenty (120) days after the end of each calendar year, annual federal income tax returns of Borrower;

 

(c) Within one hundred twenty (120) days of
the end of each calendar year, updated personal financial statements in form and substance reasonably satisfactory to the Lender
and copies of federal and state income tax returns of Individual Guarantor;

 

(d) Within one hundred eighty (180) days of
the end of each fiscal year, audited financial statement of Corporate Guarantor in form and substance reasonably satisfactory to
the Lender;

 

(e) Within thirty (30) days of filing but
not later than one hundred eighty (180) days after the end of each calendar year, annual federal income tax returns of Corporate
Guarantor; and

 

(f) Promptly, from time to time, such other
information regarding its operations, assets, business, affairs and financial condition, as the Lender may reasonably request.

 

6.06. Adverse Changes. Promptly
advise the Lender of (a) all litigation and proceedings affecting the Borrower in which the amount involved is Fifty Thousand Dollars
($50,000) or more and is not covered by insurance; (b) any material adverse change in its condition, financial or otherwise; or
(c) any Default described in Article IX hereof or of the occurrence of any event which upon notice or lapse of time or both would
constitute such an Event of Default.

 

6.07. Accounting. Maintain
a standard system of accounting in accordance with GAAP.

 

6.08. Depository. Use the
Lender as the principal bank of account of the Borrower's funds.

 

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6.09. Additional Instruments.
Promptly execute and deliver or cause to be executed and delivered to the Lender all such additional and/or supplemental other
instruments and documents from time to time as the Lender deems necessary or appropriate for the performance of the Borrower's
obligations under this Agreement, so long as such additional instruments do not create any additional liabilities or obligations
of the Borrower.

 

6.10. Subordination of Debt.
Subordinate all member debt to this Loan and not make any payments on account of such debt without the prior written consent of
the Lender.

 

6.11. Compliance with Laws.
Promptly comply with all laws, ordinances, orders, rules, statutes and regulations of Governmental Authorities and furnish the
Lender, promptly, with reports of any official searches made by any Governmental Authorities and any claims of violations thereof.

 

6.12. Inspection of Premises.
Permit the Lender, its representatives and the Construction Consultant, to enter upon the Premises at all reasonable times, to
inspect the Improvements and all materials to be used in the construction thereof and to examine all detailed plans and shop drawings
which are or may be kept at the construction site. The Borrower will cooperate and also cause the Contractor and the subcontractors
under the Major Subcontracts to cooperate with the Construction Consultant to enable him to perform his functions hereunder. At
the time of each inspection by the Construction Consultant, the Borrower will make available to the Construction Consultant, on
demand, daily log sheets covering the period since the immediately preceding inspection showing the date, weather, subcontractors
on the job, number of workers and status of construction.

 

6.13. Payment of Fees. Pay
or authorize the Lender to pay out of proceeds of the Loan all costs and expenses required for the Completion of the Improvements
and the satisfaction of the conditions of this Agreement, including without limitation:

 

(a) The commitment fee and all costs of title
searches or abstracts, document taxes, stamp taxes and recording expenses;

 

(b) Any fees and commissions due to brokers
in connection with this transaction; and

 

(c) The Construction Consultant's fees and
expenses and Lender's counsel fees and expenses.

 

6.14. Commencement of Construction.
Commence construction of the Improvements no later than thirty (30) days from the date hereof; requisition the Initial Advance
not later than thirty (30) days after commencement of such construction and subsequent advances on a monthly basis (or, with the
Lender's approval, less frequently) thereafter; cause the construction thus begun to be prosecuted with diligence and continuity
in accordance with the Plans except during the existence of delays (for not more than forty-five (45) days) caused by events beyond
its control; and complete the Improvements in accordance with the Plans on or before the Completion Date free and clear of defects
and liens or claims for liens for material supplied or labor or services performed in connection with the construction of the Improvements.

 

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6.15. Satisfaction of Conditions.
Cause the satisfaction of all conditions of this Agreement to be performed by or imposed upon the Borrower.

 

6.16. Indemnification. Indemnify
the Lender against claims of brokers arising by reason of the execution hereof or the consummation of the transactions contemplated
hereby.

 

6.17. Delivery of Bill of Sale, Etc.
Deliver to the Lender or the Construction Consultant copies of all contracts, bills of sale, statements, receipted vouchers or
agreements under which the Borrower claims title to any materials, fixtures or articles incorporated in the Improvements or subject
to the lien of the Security Documents, or under which it has incurred costs for which it is entitled to a Loan advance.

 

6.18. Correction of Defects.
Upon demand of the Lender or the Construction Consultant, correct any defects (including structural) in the Improvements or any
departures from the Plans not approved by the Lender (with respect to which the advance of any Loan proceeds shall not constitute
a waiver of the Lender's right to require correction of any such defects or departures from the Plans not theretofore discovered
by, or called to the attention of, the Lender or the Construction Consultant).

 

6.19. Security. Employ means
to protect from theft or vandalism all portions of the Improvements and all tools and building materials stored at the Premises.

 

6.20. Compliance with Easements, Etc.
Comply with all restrictions, covenants and easements affecting the Premises or the Improvements.

 

6.21. Change Orders. Not permit
Change Orders which would involve a change in costs of more than $30,000 or involve changes exceeding $60,000 in the aggregate.

 

VII. FINANCIAL COVENANTS

 

The Borrower covenants and agrees that,
from the date hereof and until payment in full of the principal of, and interest on, the Note and any other Indebtedness of the
Borrower to the Lender, whether now existing or arising hereafter, unless the Lender shall otherwise consent in writing, the Borrower
will:

 

7.01. Minimum Debt Service Coverage
Ratio. Maintain at all times a minimum debt service coverage ratio for the Premises of 1.25X, to be tested annually upon
review of the Borrower's federal tax return commencing after the first year of the Lease. Maintain at all times a minimum debt
service coverage ratio of the Corporate Guarantor of 1.25x, to be tested annually upon review of the audited, consolidated financial
statements commencing with the receipt of the December 31, 2010 audited financial report. Debt Service Coverage Ratio is defined
as the sum of earnings before interest, taxes, depreciation and amortization less cash capital expenditures, distributions, cash
taxes and cash preferred dividends divided by senior debt service requirements.

 

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VIII. NEGATIVE COVENANTS

 

The Borrower covenants and agrees that,
until payment in full of the principal of, and interest on, the Note and any other Indebtedness of the Borrower to the Lender,
whether now existing or arising hereafter, unless the Lender shall otherwise consent in writing, it will not, directly or indirectly:

 

8.01. Indebtedness. Incur,
create, assume, become or be liable in any manner with respect to, or permit to exist, any Indebtedness, liability or lease commitment,
except upon such terms and conditions as may be mutually agreed upon in advance by the Borrower and the Lender and except:

 

(a) Indebtedness under this Agreement and/or
any of the Security Documents and/or evidenced by the Note;

 

(b) Indebtedness with respect to trade obligations
and other normal accruals in the ordinary course of business not yet due and payable in accordance with customary trade terms or
with respect to which the Borrower is contesting in good faith the amount or validity thereof by appropriate proceedings and then
only to the extent the Borrower has set aside on its books adequate reserves therefor;

 

(c) Indebtedness described in the financial
statements and existing on the date hereof; provided that such Indebtedness is paid in accordance with its stated terms without
renewal, extension or modification;

 

(d) Other Indebtedness in the aggregate not
in excess of Twenty Five Thousand Dollars ($25,000);

 

(e) loans to the Borrower made by companies
affiliated with the Borrower.

 

8.02. Liens. Create, incur,
make, assume or suffer to exist any assignment, mortgage, pledge, lien, charge, security interest or other encumbrance of any nature
whatsoever on any of its property or assets, now or hereafter owned, other than in favor of the Lender or other than:

 

(a) liens securing the payment of taxes, either
not yet due or the validity of which is being contested in good faith by appropriate proceedings, and as to which there shall have
been set aside on its books adequate reserves or other provisions made in accordance with GAAP;

 

(b) liens securing the Note;

 

(c) the Permitted Encumbrances;

 

(d) liens imposed by law, such as carriers',
warehousemen's and mechanics' liens, bankers' set off rights and other similar liens arising in the ordinary course of business
for sums not yet due or being contested in good faith and by appropriate proceedings diligently conducted and for which proper
reserve or other provision has been made in accordance with GAAP;

 

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(e) liens arising in the ordinary course of
business out of pledges or deposits under worker's compensation laws, unemployment insurance, old age pensions, or other social
security or retirement benefits, or similar legislation;

 

(f) liens incurred as purchase money liens
or other liens of a conditional vendor or refundings thereof on property acquired or held by the Borrower to secure the purchase
price of such property; provided that the liens permitted by this clause (f) shall at all times be confined solely to the property
so purchased and shall secure Indebtedness which does not exceed the lower of the fair market value on the date of purchase or
the cost of the property so purchased and that any such obligations shall not otherwise be prohibited by the terms of this Agreement;

 

(g) liens arising from or upon any judgment
or award, provided that such judgment or award is being contested in good faith by proper appeal proceedings and only so long as
execution thereon shall be stayed;

 

(h) liens securing Indebtedness in the aggregate
not in excess of Twenty Five Thousand Dollars ($25,000).

 

8.03. Guaranties. Make any
loans or advances to, or assume, guarantee, endorse or otherwise in any way become or be responsible for obligations of any other
Person, whether by agreement to purchase the Indebtedness of any other Person, or agreement for the furnishing of funds to any
other Person, firm, corporation or other enterprise, through purchase of goods, supplies or services, or by way of stock purchase,
capital contribution, advance or loan, for the purpose of paying any Indebtedness or obligation of such other Person, or otherwise,
except the endorsement of negotiable instruments for deposit or collection in the normal course of business.

 

8.04. Sale of Assets; Management.
Sell, lease, transfer or otherwise dispose of any or all of its properties, assets, rights, licenses and franchises to any Person,
except in the ordinary course of its business, or turn over the management of, or enter a management contract with respect to,
such properties, assets, rights, licenses, and franchises.

 

8.05. Leasebacks. Enter into
any arrangement, directly or indirectly, with any Person whereby it shall sell or transfer any property, real, personal or mixed,
used or useful in its business, whether now owned or hereafter acquired, and thereafter rent or lease such property.

 

8.06. Investments. Purchase,
invest in or otherwise acquire or hold securities, including, without limitation, capital stock and evidences of indebtedness of,
or make loans or advances to, or enter into any arrangement for the purpose of providing funds or credit to, any other Person,
except investments in short-term obligations of the United States or certificates of deposit of the Lender.

 

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8.07. Fundamental Changes.
Dissolve, liquidate, consolidate with, or merge with, or otherwise acquire all or substantially all of the assets or properties
of, any other corporation, or make any substantial change in its executive management, or engage, directly or indirectly, in any
business substantially different from the business now being conducted.

 

8.08. Acceleration of Other Indebtedness.
 Accelerate the maturity of any Indebtedness now or hereafter outstanding to any other bank, supplier, or other third party,
or repay the same otherwise than in accordance with its regular amortization.

 

8.09. Performance of Work.
Permit the performance of any work on the Improvements pursuant to the Construction Contract, Major Subcontracts, Change Orders
or Plans until the Lender or the Construction Consultant shall have received copies of such Construction Contract, Major Subcontracts,
Change Orders or Plans and, in the case of Change Orders (except as provided in Section 6.21 hereof) or Plans, given specific written
approval thereof; it being understood that approval of any Plans or Change Orders will not obligate the Lender to increase or advance
any Loan budget amount on account of any such Plans or Change Orders.

 

8.10. Installation of Material, etc.
Purchase nor install materials, equipment, fixtures, furnishings or any other part of the Improvements under purchase money security
agreements, conditional sales contracts or lease agreements, or other arrangements wherein title to or a security interest in such
property is retained or the right is reserved or accrues to anyone to remove or repossess any such property.

 

8.11. Transfer of Interests.
Not permit the direct or indirect transfer of any interest in the Borrower by any of its present members or the direct or indirect
dilution of the percentage interest in the Borrower currently held by any present member without the prior written consent of the
Lender.

 

8.12. Hazardous Waste. Release,
generate or dispose of any Hazardous Waste at the Premises or on any properties adjacent to the Premises in violation of any Hazardous
Waste Laws. In the event that any Hazardous Waste is found at the Premises, the Borrower shall immediately contain and remove the
same in compliance with all Hazardous Waste Laws. The Borrower shall insure that all of its properties and operations, and those
of its Lessees, are in compliance with all Hazardous Waste Laws.

 

IX. DEFAULTS AND REMEDIES

 

9.01. Events of Default. The
following shall constitute Events of Default:

 

(a) any representation or warranty made herein,
or in any report, certificate, financial statement, Requisition or other instrument furnished in connection with this Agreement,
or the borrowing hereunder, shall prove to be false or misleading in any material respect on or as of the date made or deemed made;

 

(b) default in the payment of any installment
of the principal of, or fees or interest on, the Note after the date when the same shall become due and payable, whether at the
due date thereof or at a date fixed for prepayment or by acceleration or otherwise;

 

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(c) default, after the expiration of any applicable
grace period, in the payment of any installment of the principal of, or fees or interest on, any other Indebtedness of the Borrower
to the Lender after the date when the same shall become due and payable;

 

(d) default in the due observance or performance
of any covenant, condition or agreement contained in Articles V, VI or VII hereof, in the Note (other than payment) or in the Security
Documents, and the continuance of such default for a period of twenty (20) days after the date such performance or observance was
due;

 

(e) default in the due observance or performance
of any other covenant, condition or agreement, on the part of the Borrower to be observed or performed pursuant to the terms hereof,
and the continuance of such default for a period of twenty (20) days after the date such performance or observance was due;

 

(f) default, after the expiration of any applicable
grace period, in the due observance or performance of any covenant, promise or provision contained in any other agreement of the
Borrower in favor of the Lender, including without limitation, any other loan agreement, mortgage deed or security document;

 

(g) default with respect to any evidence of
Indebtedness of the Borrower (other than the Note), if the effect of such default is to accelerate the maturity of such Indebtedness
or to permit the holder thereof to cause such Indebtedness to become due prior to the stated maturity thereof, or if any Indebtedness
of the Borrower is not paid, when due and payable, whether at the due date thereof or a date fixed for prepayment or otherwise;

 

(h) the Borrower shall (i) apply for or consent
to the appointment of a receiver, trustee or liquidator of it or any of its property, (ii) admit in writing inability to pay its
debts as they mature, (iii) make a general assignment for the benefit of creditors, (iv) be adjudicated a bankrupt or insolvent
or (v) file a voluntary petition in bankruptcy, or a petition or an answer seeking reorganization or an arrangement with creditors
or to take advantage of any bankruptcy, reorganization, insolvency, readjustment of debt, dissolution or liquidation law or statute,
or an answer admitting the material allegations of a petition filed against it in any proceeding under any such law or if action
shall be taken for the purpose of effecting any of the foregoing;

 

(i) an order, judgment or decree shall be
entered, without the application, approval or consent of the Borrower by any court of competent jurisdiction, approving a petition
seeking reorganization of the Borrower or appointing a receiver, trustee or liquidator of the Borrower or of all or a substantial
part of the assets of the Borrower, provided, however, with respect to such involuntary proceedings, the Borrower shall have thirty
(30) days from the date of such order, judgment or decree to discharge the same;

 

(j) final judgment for the payment of money
in excess of an aggregate of Twenty Thousand Dollars ($20,000) shall be rendered against the Borrower and the same shall remain
undischarged for a period of thirty (30) consecutive days, during which execution shall not be effectively stayed;

 

    	24

    	 

    

 

(k) the occurrence of any attachment of any
deposits or other property of the Borrower in the hands or possession of the Lender, or the occurrence of any attachment of any
other property of the Borrower (other than the Premises or the Improvements thereon) in an amount exceeding Twenty Thousand Dollars
($20,000) which shall not be discharged within thirty (30) days of the date of such attachment;

 

(l) any Event of Default shall occur and be
continuing under any Guaranty;

 

(m) any Guarantor shall terminate his Guaranty;

 

(n) failure to carry on the construction of
the Improvements with reasonable dispatch or discontinuance of such construction for a continuous period of five (5) days or, as
a result of delays beyond the Borrower's reasonable control, for a period of more than forty-five (45) days;

 

(o) refusal to permit the Lender, its representatives
or the Construction Consultant to enter upon the Premises at all reasonable times to inspect the Improvements, the construction
thereof and all materials, fixtures and articles used or to be used in said construction and to examine all detailed plans, shop
drawings and specifications which relate to the Improvements, and/or failure to furnish to the Lender, its representative or the
Construction Consultant copies of such plans, drawings and specifications when requested;

 

(p) use of any materials, fixtures, furnishings
or equipment in the construction of the Improvements or any appurtenances that are obsolete or not new or not installed in a good
and workmanlike manner in accordance with the Plans;

 

(q) execution by the Borrower of any security
instrument other than the Security Documents covering any materials, fixtures, furnishings or equipment intended to be incorporated
or placed in the Improvements, the filing of a financing statement, publishing notice of such security instrument, or failure to
purchase any of such materials, fixtures, furnishings or equipment so that the ownership thereof will not vest unconditionally
in the Borrower free from encumbrances on delivery at the Premises;

 

(r) failure by the Borrower to disclose to
the Lender or the Construction Consultant, upon request, the names of all Persons with whom the Borrower has contracted or intends
to contract for the construction of the Improvements or for the furnishing of labor or materials therefor, or to obtain the approval
of such Persons by the Lender when required by this Agreement;

 

(s) failure or inability of the Borrower to
complete the Improvements on or before the Completion Date;

 

(t) refusal or inability of the Borrower to
satisfy any condition to the receipt of an advance hereunder for a period in excess of thirty (30) days;

 

    	25

    	 

    

 

(u) failure to satisfy or bond a lien for
the performance of work or the supply of materials filed against the Premises before the date of any Loan advance or for a period
of thirty (30) days after the filing thereof;

 

(v) the sale, conveyance or other transfer
of any interest of the Borrower in the Improvements or the Premises;

 

(w) the failure or inability of the title
insurer to certify, at the time or prior to the time at which the Lender would make any advance of the Loan, that title to the
Premises has not adversely changed since the date hereof;

 

(x)(i) the Improvements, or the collateral
which is the subject of the Security Documents, are, in the opinion of the Lender, materially damaged or destroyed by fire or other
casualty or (ii) the Premises or any substantial portion thereof is taken by eminent domain in such a manner as to significantly
interfere with the operations of any business and/or the Completion of the Improvements thereon;

 

(y) if (i) any "notice of violation",
"notice of responsibility" or other similar order is issued by any one or more Governmental Authorities against the Premises
or the Borrower under any applicable Hazardous Waste Law and remains undischarged for a period of sixty (60) days after the issuance
thereof or such lesser period of time stated in said notice or in any Hazardous Waste Law or (ii) if any lien or claim is filed
or arises against the Premises under any Hazardous Waste Law;

 

(z) a default under the terms of the Hedging Contracts;

 

(aa) loss, theft, damage or destruction of
any material portion of the Collateral for which there is no insurance coverage or for which, in the opinion of the Lender, there
is insufficient insurance coverage;

 

(bb) the occurrence of any adverse change
described in Section 6.06 hereof;

 

(cc) a default shall have occurred under any
of the Leases;

 

(dd) if any easement over, across or under
or otherwise affecting the Premises or any portion thereof (other than customary utility easements) shall be granted without the
Lender's prior written consent; or

 

(ee) the Security Documents shall at any time
after their execution and delivery and for any reason cease (a) to create a valid and perfected mortgage and/or security interest
in and to the property purported to be the subject thereof and/or in the priority agreed to by the parties thereto; or (b) to be
in full force and effect or shall be declared null and void, or the validity or enforceability thereof shall be contested by the
Borrower, or the Borrower shall deny it has any further liability or obligation under the Security Documents.

 

    	26

    	 

    

 

9.02. Acceleration. Upon the
occurrence of any such Event of Default and at any time thereafter during the continuance of such Event of Default, the Lender
may, by written notice to the Borrower, declare the entire principal amount of the Note, and any and all other Indebtedness of
the Borrower to the Lender, forthwith to be due and payable, whereupon the Note and/or such other Indebtedness shall become forthwith
due and payable, both as to principal and interest, without presentment, demand, protest or notice of any kind, all of which are
hereby expressly waived, anything contained herein or in the Note or other evidence of such Indebtedness to the contrary notwithstanding
and any obligation of the Lender to extend further credit pursuant to any of the terms hereof shall immediately terminate.

 

9.03. Set-off. The Borrower
hereby grants to the Lender the right at any time after the occurrence of an Event of Default to set off or otherwise apply by
the Lender against the payment of all amounts owing in respect to this Agreement or of any other liabilities, Obligations and Indebtedness
of the Borrower, or any part thereof, whether or not due, in such order as it shall determine, all tangible and intangible personal
property, credits, accounts, claims and balances of whatever nature of the Borrower at any time in the possession or control of
or owing by the Lender or its agents (remittances and property to be deemed in possession of the Lender as soon as put in transit
to it) including, without limitation, any balances on deposit in any account of the Borrower.

 

9.04. Completion by the Lender.
After and during the continuation of any Event of Default which in the Lender's judgment may interfere with Completion of the Improvements,
the Lender shall have the right and is hereby given a license, in addition to and without limiting any other rights or remedies
afforded by the Note, the Security Documents, the Guaranty or this Agreement, or other documents executed and delivered hereunder
or thereunder, or by law, to enter or to cause the Construction Consultant or another independent contractor of the Lender's selection
to enter the Premises and perform any and all work and labor necessary for the Completion of the Improvements. All sums advanced
hereunder and any other amounts expended by the Lender for the Completion of the Improvements shall be deemed to have been advanced
to the Borrower and shall be secured by the Security Documents.

 

9.05. Attorney-In-Fact. For
purposes of Section 9.04, the Borrower hereby constitutes and appoints the Lender, the Construction Consultant and/or another independent
contractor selected by the Lender, its true and lawful attorney-in-fact with full power of substitution for the purpose of causing
the Completion of the Improvements in the name of the Borrower, and hereby empowers said attorney-in-fact to do any or all of the
following:

 

(a) To use any and all funds which may remain
unadvanced hereunder for the purpose of causing the Completion of the Improvements in the manner called for by the Plans;

 

(b) To make such additions, changes and corrections
in the Plans as shall be necessary or desirable for the Completion of the Improvements in substantially the manner contemplated
by the Plans;

 

(c) To employ any contractors, subcontractors,
agents, architects and inspectors required for said purposes;

 

    	27

    	 

    

 

(d) To employ attorneys to defend against
attempts to interfere with the exercise of the powers granted hereby;

 

(e) To pay, settle or compromise all existing
bills and claims which are or may be liens against the Premises or Improvements or may be necessary or desirable for the Completion
of the Improvements or the clearance of title;

 

(f) To execute all applications and certificates
in the name of the Borrower which may be required by any construction contract; and/or

 

(g) To prosecute and defend all actions or
proceedings in connection with the construction of the Improvements on the Premises and to take such action, require such performance
and do any and every other act as is deemed reasonably necessary with respect to the Completion of the Improvements which the Borrower
might do in its own behalf.

 

9.06. Power Coupled with an Interest.
The power-of-attorney given in Section 9.05 shall be a power coupled with an interest which, together with the license given in
Section 9.04, cannot be revoked until the Completion of the Improvements in accordance with this Agreement.

 

9.07. Payment Direct to Contractor.
After the occurrence of any Event of Default, the Borrower does irrevocably permit and authorize the Lender to advance any remaining
proceeds of the Loan directly to subcontractors under the Major Subcontracts, the Contractor and other Persons to pay for the Completion
of the Improvements but the Lender is not under any obligation to do so. No further direction or authorization from the Borrower
shall be necessary to warrant such direct advances and all such advances shall satisfy pro tanto the obligations of the Lender
hereunder and shall be secured by the Security Documents as fully as if made to the Borrower regardless of the disposition thereof
by any major subcontractor, the Contractor or such other Persons. The Lender may impose any condition for such direct payment including,
but not limited to, receipt of estoppel certificates, waivers of lien, releases and the like.

 

9.08. Casualty or Condemnation.
If one of the events set forth in Section 9.01(y) occurs, the insurance proceeds or condemnation award, as the case may be, shall
be paid to the Lender alone, to be applied, in the Lender's discretion, and in such order as the Lender may determine, (i) to the
costs of collection of such amounts, (ii) to payment of the outstanding amount of the Loan, whether or not then due, and all other
sums then due from the Borrower to Lender or (iii) in accordance with this Agreement with the same limitations and restrictions
applicable to advances hereunder, to the restoration, replacement and rebuilding of the Improvements. The Lender is authorized,
without the consent of the Borrower, to adjust and compromise any such loss or condemnation award, collect and receipt for any
such proceeds or awards and endorse the Borrower's name on any check or draft in payment thereof, provided, however, without limiting
the foregoing, the Lender shall consult with Borrower and advise the Borrower of its actions.

 

    	28

    	 

    

 

9.09. Other Remedies. The
Lender may look to, utilize, and realize upon any item or portion of any security held by it hereunder or under the Security Documents,
or other instrument securing the Loan or any other Indebtedness, liabilities, or Obligations of the Borrower to the Lender, whether
now existing or hereafter contracted or acquired, in any order it may elect without obligation to equalize the burden between or
among the separate items of security or portions thereof or between or among the owners thereof, or to marshal the same in any
way, and the Lender may apply any proceeds of any security in such order as it shall determine, and after all Indebtedness, liabilities,
and Obligations now or hereafter of the Borrower to the Lender have been paid in full, the Lender shall account for any security
then remaining or any surplus proceeds of any security then remaining to the owner of such security.

 

X. MISCELLANEOUS

 

10.01. Survival of Representations.
This Agreement and all covenants, agreements, representations and warranties made herein and in the certificates delivered pursuant
hereto, shall survive the making by the Lender of the Loan, the execution and delivery to the Lender of the Note and the Security
Documents, and shall continue in full force and effect so long as the Note and any other Indebtedness of the Borrower to the Lender
is outstanding and unpaid.

 

10.02. Successors and Assigns.
Whenever in this Agreement any of the parties hereto is referred to, such reference shall be deemed to include the successors and
assigns of such party; and all covenants, promises and agreements in this Agreement contained, by or in behalf of the Borrower
shall inure to the benefit of the respective successors and assigns of the Lender, provided that the Borrower may not transfer
or assign any of its respective rights hereunder without the prior written consent of the Lender.

 

10.03. Lender's Expenses.
The Borrower will reimburse the Lender upon demand for all out-of-pocket costs, charges and expenses of the Lender (including reasonable
fees and disbursements of counsel to the Lender) in connection with (i) the preparation, execution and delivery of this Agreement,
the Note, the Security Documents and any other agreements hereunder, (ii) the making of the Loan, (iii) any amendments, modifications,
consents, or waivers in respect thereof, (iv) any enforcement thereof and (v) any enforcement of the Lender's rights with respect
to, or the administration, supervision, preservation, protection of, or realization upon, any property securing the Note and/or
this Agreement.

 

10.04. Governing Law. This
Agreement, the Note and the Security Documents (unless otherwise specified therein) shall be construed in accordance with and governed
by the internal laws (and not the law of conflicts) of the State of Rhode Island.

 

10.05. No Waiver. No modification
or waiver of any provision of this Agreement or the Note nor consent to any departure by the Borrower therefrom, shall in any event
be effective unless the same shall be in writing, and then such waiver or consent shall be effective only in the specific instance,
and for the purpose, for which given. No notice to, or demand on, the Borrower, in any case, shall entitle the Borrower to any
other or future notice or demand in the same, similar or other circumstances. Neither any failure nor delay on the part of the
Lender in exercising any right, power or privilege hereunder, or under the Note, or any other instrument given as security therefor,
shall operate as a waiver thereof, nor shall a single or partial exercise thereof preclude any other or future exercise, or the
exercise of any other right, power or privilege.

 

    	29

    	 

    

 

10.06. Captions.  The captions
and other headings contained in this Agreement are for reference only and shall not affect the meaning or interpretation of this
Agreement.

 

10.07. Notices. All notices,
requests, demands, consents or other communications given hereunder or in connection herewith (collectively the "Notice")
shall be in writing and shall be sent by registered or certified mail, return receipt requested, postage prepaid, addressed to
the party to receive such Notice at its address set forth below. Either party may, by Notice given as aforesaid, change its address
for any subsequent Notice.

 

	 	If to the Lender:	
        Rockland Trust Company

        288 Union Street

        Rockland, MA 02370

        Attention: Graham M. W. Kilvert, Vice President

	 	 	 
	 	With a copy to:	
        Edward G. Avila, Esquire

        Roberts, Carroll, Feldstein & Peirce Incorporated

        10 Weybosset Street

        Providence, Rhode Island 02903

	 	 	 
	 	If to the Borrower:	
        109 LONG WHARF LLC

        c/o Phoenix Bulk Carriers

        88 Valley Road

        Middletown, Rhode Island 02842

	 	 	 
	 	With a copy to:	
        Patrick O’Neill Hayes, Jr., Esquire

        Corcoran Peckham Hayes & Galvin, PC

        31 America’s Cup Avenue

        Newport, Rhode Island 02840

 

Each party by notice duly given in accordance herewith may specify
a different address for the purposes hereof.

 

10.08. Maximum Payments. Notwithstanding
any other terms or conditions hereof, in no event shall the amount paid or agreed to be paid to the Lender hereunder exceed the
maximum permissible under applicable law. If, for any reason, fulfillment of any obligation of Borrower shall involve the exceeding
of such maximum, then such obligation, automatically and without action or notice by Lender, shall be reduced to such maximum valid
amount and any amount received by Lender in excess thereof shall be applied to the reduction of principal outstanding and not to
interest.

 

    	30

    	 

    

 

10.09. Jurisdiction. The Borrower,
to the extent that it may lawfully do so, hereby consents to the jurisdiction of the courts of the State of Rhode Island and the
United States District Court for the District of Rhode Island as well as to the jurisdiction of all courts from which an appeal
may be taken from such courts, for the purpose of any suit, action or other proceeding arising out of any of its Obligations arising
hereunder or with respect to the transactions contemplated hereby, and expressly waives any and all objections it may have as to
venue in any of such courts.

 

10.10. Severability. Any provision
of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the
extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.

 

10.11. Gender. Words of the
masculine gender shall mean and include correlative words of the feminine and neuter genders and words importing the singular number
shall mean and include the plural number and vice versa.

 

10.12. Arm's-Length Transaction.
The Borrower and each Guarantor (by delivery of a Guaranty) recognize, stipulate and agree that the Lender's actions and relationships
with the parties hereto, including, but not limited to, those relationships created or referenced by or in this Agreement, the
Note and the Security Documents, have been and constitute arm's-length commercial transactions and that such actions and relationships
shall at all times in the future continue to constitute arm's-length commercial transactions and that the Lender or the Lender's
attorneys shall not at any time act, be obligated to act, or otherwise be construed or interpreted as acting as or being the agent,
attorney, partner, employee or fiduciary of any such parties.

 

10.13. Negotiations. The Borrower
and each Guarantor (by delivery of a Guaranty) stipulate and agree that each of this Agreement, the Note and the Security Documents
are products of and result from lengthy arm's-length negotiations between the parties and that neither the Lender nor any other
party has exerted or attempted to induce, through threats or otherwise, the execution or delivery of this Agreement, the Note or
the Security Documents. Without in any way limiting the foregoing, the Borrower and each Guarantor stipulate and agree that at
all times during the course of the negotiations surrounding the execution and delivery of this Agreement, the Note and the Security
Documents, they have, to the extent deemed necessary or advisable in their sole discretion, been advised and assisted by competent
counsel of their own choosing, that counsel has been present and actively participated in the negotiations surrounding this Agreement,
the Note and the Security Documents, and that they have been fully advised by counsel of their choosing of the effect of each term,
condition, provision and stipulation contained herein and therein.

 

10.14. No Offer. Neither the
negotiations to date nor the preparation of this Agreement, the Note or the Security Documents shall be deemed an offer by any
of the parties to the other. No such instrument, document or agreement shall be deemed binding on any party until such party has
executed and delivered the same in writing.

 

10.15. Agreements Relating to Consideration.
The Borrower and each Guarantor (by delivery of a Guaranty) hereby acknowledge and agree that the covenants and agreements of the
Lender under this Agreement constitute full and fair consideration for the obligations, covenants and agreements of (a) the Borrower
under this Agreement and (b) each Guarantor under the applicable Guaranty, and that, by virtue of such consideration, each of the
parties hereto and thereto have received reasonably equivalent value in exchange for the covenants and agreements hereunder and
thereunder.

 

    	31

    	 

    

 

10.16. No Joint Venture. Notwithstanding
anything to the contrary contained herein, in the Note and/or in the Security Documents, the Lender, by entering into this Agreement
with the Borrower, will not be deemed a partner or joint venturer with the Borrower or any Guarantor and the Borrower (and each
Guarantor by virtue of the execution and delivery by each Guarantor of a Guaranty) agree to hold the Lender harmless from any damages
and expenses resulting from such construction of the relationship of the parties or any exertion thereof.

 

10.17. Integration. This Agreement
and the Security Documents contain the entire agreement between the parties relating to the subject matter hereof and thereof and
supercede all oral statements and prior writings with respect thereto.

 

10.18. Jury Waiver. Each party
to this Agreement hereby expressly WAIVES ANY RIGHT TO TRIAL BY JURY of any claim, demand, action or cause of action (a) arising
under this Agreement or any other instrument, document or agreement executed or delivered in connection herewith, (b) in any way
connected with or incidental to the dealings of the parties hereto or any of them with respect to this Agreement or any other instrument,
document or agreement executed or delivered in connection herewith, or the transactions related hereto or thereto, in each case
whether now existing or hereafter arising and whether sounding in contract or tort or otherwise; AND EACH PARTY HEREBY AGREES AND
CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY A COURT TRIAL WITHOUT A JURY AND THAT ANY PARTY
TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT
OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

 

[Signature Pages Follow]

 

    	32

    	 

    

 

IN WITNESS WHEREOF, the Borrower
and the Lender have caused this Construction Loan Agreement to be duly executed all as of the day and year first above written.

 

	WITNESS/ATTEST:	 	Rockland Trust Company
	 	 	 
	 	 	By	 
	 	 	Name: Graham M. W. Kilvert
	 	 	Title: Vice President

 

    	33

    	 

    

 

IN WITNESS WHEREOF, the Borrower
and the Lender have caused this Construction Loan Agreement to be duly executed all as of the day and year first above written.

 

	WITNESS/ATTEST:	 	109 LONG WHARF LLC
	 	 	 
	 	 	By:	 
	 	 	Name: Edward Coll
	 	 	
        Title: President

        

 

    	34

    	 

    

 

EXHIBIT A

 

Initial Project Cost Statement

 

    	35

    	 

    

 

EXHIBIT C

 

Permitted Encumbrances

 

		1.	Grant of Easement recorded in Book 386 at Page 15.
	 	 	 

		2.	Environmental Land Usage Restriction recorded in Book 769 at Page 197
	 	 	 

		3.	Zoning Decisions recorded in Book 1540 at Page 31, Book 2037 at Page 25 and Book 2095 at Page 217.

 

    	36

    	 

    

 

EXHIBIT D

 

Forced Funding

 

    	37Exhibit 10.5

 

LOAN AND GUARANTY AGREEMENT

 

THIS LOAN AND GUARANTY AGREEMENT (“Agreement”)
is entered into as of the 25th day of February, 2011, between GATX CORPORATION, a New York corporation (“Lender”),
and BULK DISCOVERY (BERMUDA) LTD., a Bermuda company (“Borrower”), BULK PARTNERS (BERMUDA) LTD., a Bermuda company
(“Holding Company”), and AMERICAS BULK TRANSPORT (BVI) LIMITED, a British Virgin Islands business company (“Charterer”),
with respect to the following facts:

 

A.        Borrower
wishes to obtain from Lender, and Lender wishes to provide to Borrower a term loan in the principal amount of U.S. $9,120,000.00
on the terms and conditions stated herein, in order to finance the purchase of the vessel IOANNA L, Greek Official No. 9577, IMO No.
8806187, to be reflagged in Panama as the BULK DISCOVERY (the “Vessel”).

 

B.        Holding
Company is the indirect owner of Borrower, and Charterer will be the time charterer of the Vessel after Borrower purchases the
Vessel, in consideration of which Holding Company and Charterer are guarantying the Borrower’s obligations under this Agreement.

 

NOW, THEREFORE, in consideration of the
foregoing and the agreements of the parties hereto, and for other good and valuable consideration, the receipt of which the parties
hereby acknowledge, the parties hereto represent, warrant and agree as follows:

 

ARTICLE I

DEFINITIONS AND CONSTRUCTION

 

1.1       Defined
Terms. As used herein and in the schedules of this Agreement, the terms defined below shall have the definitions ascribed to
them below:

 

“Advance” has the meaning
given to it in Section 2.1(a).

 

“Affiliate” means, with
respect to a Person any other Person which directly or indirectly controls, is controlled by, or is under common control with,
such Person. “Control” “controlled by” and “under common control with” means direct or indirect
possession of the power to direct or cause the direction of management or policies (whether through ownership of voting securities,
by contract or otherwise); provided that control shall be conclusively presumed for this purpose when any Person or affiliated
group directly or indirectly owns ten percent (10%) or more of the securities or other Equity Interests having ordinary voting
power for the election of directors, managing general partners, trustees or managers of a Person.

 

“Allseas” means Allseas
Logistics Bermuda Ltd., a Bermuda company.

 

“Allseas Charge on Cash Deposit”
has the meaning given to it in Section 3.1(a)(xiii).

    	 

    	 

    

 

“Banking Day” means any
day on which commercial banks are open for general business (including dealings in foreign exchange and foreign currency markets)
in New York and Chicago.

 

“Bankruptcy or Other Proceeding”
means a Debtor Relief Proceeding; a dissolution, winding up, liquidation, or reorganization of a Person; an arrangement with a
Person’s creditors or a composition of a Person or any of its debts; or an assignment for the benefit of creditors or any
other marshalling of the assets and liabilities of a Person.

 

“Borrower’s Earnings Assignment
Agreement” has the meaning given to it in Section 3.1(a)(iii).

 

“Bulk Discovery Freights Account”
has the meaning given to it in Section 3.1(i)

 

“Bulk Discovery Hire Account”
has the meaning given to it in Section 3.1(h)

 

“Charterer’s Earnings Assignment
Agreement” has the meaning given to it in Section 3.1(a)(v).

 

“Closing” means the satisfaction
or waiver of the conditions precedent listed in Article III.

 

“COA” means the Contract
of Affreightment between Phoenix Bulk Carriers (US) LLC and Noranda Alumina LLC dated as of January 1, 2011.

 

“Code” means the Internal
Revenue Code of 1985.

 

“Collateral” means personal
or real property, whether tangible or intangible, on which an Encumbrance is granted as security for any or all of the Obligations
outstanding from time to time under any Loan Document.

 

“Commercial Management Agreement”
means the Commercial Management Agreement for the Vessel between Borrower and Phoenix Bulk Carriers (BVI) Limited dated February
11, 2011.

 

“Commitment Fee” has
the meaning given to it in Section 3.1(j).

 

“Constitutional Documents”
means the certificate of incorporation, memorandum of association and by-laws of a corporation, as amended and restated.

 

“Credit Party” means
Borrower, Pledgor, Holding Company, Charterer, or any future Guarantor.

 

“Debtor Relief Proceeding”
means bankruptcy, insolvency, receivership dissolution, arrangement, reorganization, administration, debt relief or similar proceeding
pertaining to a Person.

    	2

    	 

    

 

“Default” means an event
or condition which, with the giving of notice, the passage of time, or both, would become an Event of Default.

 

“Default Rate” has the
meaning given to it in Section 2.1(c)(i).

 

“EBITDA” means, for any
period, for any Person, an amount equal to the Net Earnings of such Person for such period plus the following to the extent
deducted in calculating such Net Earnings: (i) the Interest Expense of such Person for such period, (ii) the provision
for federal, state, local and foreign income taxes payable by such Person for such period, and (iii) the amount of depreciation
and amortization expense deducted in determining such Net Earnings.

 

“Encumbrance” means any
lien, mortgage, pledge, assignment, security interest, liability for forfeiture, defeasance, lease, charter, right to possession
or services of the relevant property, option, right of first refusal with respect to the relevant property, restriction against
transferability or use, or other encumbrance whatsoever.

 

“Environmental Law” means
law relating to environmental, health, safety or land use matters applicable to any property.

 

“Environmental Liability”
means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties
or indemnities), that is directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) the generation,
use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the environment, or (e) any contract, agreement or other
consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

 

“Equity Interest” means
stock in a corporation, a membership interest in a company, a general or limited partnership interest in a partnership, a beneficial
interest in a trust, or other equity interest in a Person.

 

“ERISA” means the Employee
Retirement Income Security Act of 1974 and any regulations issued pursuant thereto.

 

“ERISA Affiliate” means
any trade or business (whether or not incorporated) under common control with Borrower or a Guarantor within the meaning of Section
414(b) or (c) of the Code and Sections 414(m) and (o) of the Code.

 

“Event of Default” has
the meaning given to it in Section 7.1.

 

“Fee Letter” has the
meaning given to it in Section 3.1(j).

 

    	3

    	 

    

“Fixed Charges” means,
for any period, for any Person, the sum of Interest Expense, operating lease payments, payments of the current portion of capital
leases, and payments of the current portion of long term Indebtedness, and distributions of equity made during the relevant period.

 

“Funds Deposit Agreement”
has the meaning given to it in Section 3.1(a)(ix).

 

“GAAP” means at any time
generally accepted accounting principles as then in effect in the United States, applied on a consistent basis.

 

“Governmental Authority”
includes all foreign and U.S. federal, national, state and local governments; government corporations, authorities, boards, commissions,
and entities; and all departments, ministries, agencies, bureaus, offices, and subdivisions of any of the foregoing.

 

“Guarantor” means Holding
Company, Charterer, and any other Person that grants Lender a guaranty for any of the Obligations, as the context requires.

 

“Hazardous Materials”
means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including
petroleum or petroleum distillates, asbestos or asbestos-containing materials, polychlorinated biphenyls, radon gas, infectious
or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Law.

 

“Indebtedness” means,
for any Person, (i) indebtedness for borrowed money, (ii) obligations evidenced by bonds, debentures, notes or other similar instruments,
(iii) obligations to pay the deferred purchase price of property or services, (iv) obligations as lessee under leases which shall
have been or should be, in accordance with GAAP, recorded as capital leases, (v) obligations as lessee under Synthetic Lease Obligations,
(vi) obligations with respect to undrawn letters of credit issued for the account of that Person or under bonds or suretyship arrangements;
and (vii) all obligations arising under any swap transaction or other agreement or arrangement designated to protect the Person
against fluctuation in interest rates, currency exchange rates or commodity prices; (viii) obligations to ordinary trade creditors
which are more than ninety (90) days delinquent, (ix) liabilities in respect of unfunded vested benefits under plans covered by
Title IV of ERISA, (x) obligations under indemnification agreements in favor of issuers of letters of credit (contingent or otherwise),
and (xi) obligations under direct or indirect guaranties or suretyship agreements in respect of, and obligations (contingent or
otherwise) to purchase or otherwise acquire, or otherwise to assure a creditor against loss in respect of, indebtedness or obligations
of others of the kinds referred to in clauses (i) through (x) above.

 

“Indemnitee” has the
meaning given to it in Section 9.2.

 

“Interest Expense” shall
mean for any period, for any Person, the aggregate amount of interest expense of such Person for such period as determined in accordance
with GAAP. Notwithstanding the foregoing, specific items of interest expense shall only be included in this definition to the extent
such items have been deducted from gross revenues in calculating the Net Earnings of such Person for such fiscal period.

 

“Interest Rate” has the
meaning given to it in Section 2.1(c)(i).

    	4

    	 

    

 

 

“Investment” means, as
to any Person, any acquisition or investment by such Person, whether by means of (a) the purchase or other acquisition of capital
stock or other securities of another Person, (b) a convertible loan or advance, or capital contribution to, purchase or other acquisition
of any other debt or equity participation or interest in, another Person, including any partnership interest, membership interest,
joint venture interest, or other beneficial interest in such other Person, or (c) the purchase or other acquisition (in one transaction
or a series of transactions) of assets of another Person that constitute a business unit. For purposes of covenant compliance,
the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in
the value of such Investment.

 

“IRS” means the United
States Internal Revenue Service.

 

“Loan Document” means
any of: this Agreement; and any other loan agreement, promissory note or other evidence of indebtedness related to this Agreement;
any ship or naval mortgage, security agreement, assignment, deed of trust, pledge, or other security document; any guaranty; any
subordination agreement, or any other agreement, instrument, certificate, or other document; in each case whether heretofore, concurrently,
or hereafter entered into by any Person in connection with this Agreement (each, as assigned, assumed, amended, renewed, replaced,
or otherwise modified from time to time).

 

“Manager’s Undertaking”
means a Manager’s Undertaking described in Sections 3.1(a) (vii) or 3.1(a)(viii).

 

“Material” means, with
reference to the significance of a matter which is reasonably calculable in monetary terms, a change or effect related to such
matter which has a monetary consequence of $500,000.00 or more in amount.

 

“Mortgage” has the meaning
given to it in Section 3.1(a)(ii).

 

“Multiemployer Plan”
means any employee benefit plan of the type described in Section 4001(a)(3) of ERISA, to which Borrower, a Guarantor or any ERISA
Affiliate makes or is obligated to make contributions, or during the preceding three calendar years, has made or been obligated
to make contributions.

 

“Net Earnings” means,
for any period, for any Person, the net earnings of such Person for such period determined in accordance with GAAP for such period,
but not including the net after-tax amount of: (a) any gains or losses resulting from the disposition of capital assets (as
defined by GAAP) where the consideration paid in connection with such disposition is not paid in cash, provided, however,
that when all or any portion of the consideration paid in connection with such disposition is received in cash, checks or other
cash equivalent financial instruments, such amount shall be recognized as gain or loss and included in the net earnings of such
Person in the fiscal period received; (b) any gains or income resulting from the write-up of assets; (c) any gains or
losses resulting from the acquisition of securities or the retirement or extinguishment of Indebtedness; (d) any losses from
the impairment of goodwill or other intangible assets required to be recognized under GAAP; (e) any losses from the impairment
or disposal of long-lived assets required to be recognized under GAAP; (f) any gains or losses arising from changes in accounting
principles; (g) any equity of such Person in the undistributed earnings of any Person which is not a Subsidiary; (h) any
earnings of any Person acquired by such Person through purchase, merger or consolidation or otherwise for any period prior to the
date of acquisition; (i) any deferred credit representing the excess of equity in any Subsidiary at the date of acquisition
over the cost of the investment in such Subsidiary; and (j) any extraordinary gains or losses.

    	5

    	 

    

 

 

“Obligations” means all
obligations of Borrower to repay the Advance, to pay interest thereon, or to pay and perform other debts, liabilities, obligations,
covenants and duties, existing or arising under any Loan Document, whether direct or indirect (including those acquired by assumption),
absolute or contingent, due or to become due, now existing or hereafter arising, and including interest that accrues after the
commencement, by or against Borrower or any Person of which Borrower is a partner, joint venturer, or member, or any Debtor Relief
Proceeding in which such Person is the debtor in such proceeding.

 

“Other Taxes” has the
meaning given to it in Section 2.5(a)(ii).

 

“Permit” means any authorization,
certificate, consent, approval, license, permit, waiver or exemption issued or granted by a Governmental Authority.

 

“Permitted Encumbrance”
has the meaning given to it in Section 4.9.

 

“Pension Plan” means
any “employee pension benefit plan” (as such term is defined in Section 3(2) of ERISA) that is sponsored or maintained
by Borrower, a Guarantor, or any ERISA Affiliate or to which Borrower, a Guarantor, or any ERISA Affiliate contributes or has an
obligation to contribute, or in the case of a multiple employer plan (as described in Section 4064(a) of ERISA) has made contributions
at any time during the immediately preceding five plan years.

 

“Permitted Investments”
means (i) U.S. Dollar demand deposits maintained in the United States with any commercial bank which has a combined capital and
surplus of at least $100,000,000.00; (ii) U.S. Dollar time deposits maintained in the United States with, or certificates of deposit
having a maturity of six months or less issued by, any commercial bank which has its head office in the United States and which
has a combined capital and surplus of at least $100,000,000.00; (iii) direct obligations of, or obligations unconditionally guaranteed
by, the United States Government and having a maturity of one year or less; (iv) readily marketable commercial paper having a maturity
of six months or less, issued by any corporation organized and existing under the laws of the United States, any state thereof,
or the District of Columbia and rated A-1 by Standard & Poor's Corporation or P-1 by Moody's Investors Service, Inc. (or, if
neither such organization shall rate such commercial paper at any time, rated by any nationally recognized rating organization
in the United States with the highest rating assigned by such organization).

    	6

    	 

    

 

“Person” includes an
individual natural person, corporation, limited liability company, general or limited partnership, joint venture, association,
trust, Governmental Authority, and any other entity.

 

“Phoenix” means Phoenix
Bulk Carriers (US) LLC, a Delaware limited liability company.

 

“Plan” means any “employee
benefit plan” (as such term is defined in Section 3(3) of ERISA) established by Borrower or any ERISA Affiliate.

 

“Pledgor” means Bulk
Fleet Bermuda Holding Company Ltd., a Bermuda company.

 

“Process Agent” has the
meaning given to it in Section 3.1(a)(xiv), and includes any successor thereto that is appointed as contemplated in Section 7.4.

 

“Process Agent Appointment”
has the meaning given to it in Section 3.1(a)(xiv).

 

“Requisition” means expropriation,
confiscation, requisition or acquisition of the title to or use of the Vessel, whether for full consideration or a consideration
less than full value, which is effected by any Governmental Authority or by any Person or Persons claiming to be or to represent
a Governmental Authority

 

“Reportable Event” means
any of the events set forth in Section 4043(c) of ERISA.

 

“Request for Advance”
has the meaning given to it in Section 2.1(a).

 

“Seizure” means an arrest,
repossession, taking into custody, detention or seizure by judicial or nonjudicial means (including attachment, garnishment, or
execution or levy), and “Seize” has a correlative meaning).

 

“Sub-COA” means the Contract
of Affreightment between Charterer and Phoenix dated as of January 1, 2011.

 

“Subordinated Debt” has
the meaning given to it in Section 8.6(a).

 

“Subordinated Liens”
has the meaning given to it in Section 8.6(a).

 

“Subsidiary” means any
corporation, limited liability company, partnership, joint venture, association, trust or estate of which (or in which) the relevant
Person owns, directly or indirectly, ten percent (10%) or more of (i) the outstanding capital stock having ordinary voting power
to elect a majority of the Board of Directors of such corporation (irrespective of whether or not at the time capital stock of
any other class or classes of such corporation shall or might have voting power upon the occurrence of any contingency), (ii) the
interest in the capital or profits of such limited liability company, partnership or joint venture, or association, or (iii) the
beneficial interest of such trust or estate.

    	7

    	 

    

 

“Synthetic Lease Obligation”
means the monetary obligation of a Person under (a) a so called synthetic, off-balance sheet or tax retention lease, or (b) an
agreement for the use or possession of property creating obligations that do not appear on the balance sheet of such Person but
which, upon the insolvency or bankruptcy of such Person, would be characterized as the indebtedness of such Person (without regard
to accounting treatment).

 

“Taxes” has the meaning
given to it in Section 2.5(a)(i).

 

“Technical Management Agreement”
means the Ship Management Agreement for the Vessel between Borrower and Seamar Management S.A. dated February 23, 2011.

 

“Time Charter” means
the Time Charter for the Vessel between Borrower and Charterer dated February 7, 2011.

 

“United States” means
the United States of America, its territories and possessions.

 

“Vessel” has the meaning
given to it in Recital A.

 

1.2        Currency.
All references to dollars and all usage of the symbol “$” are references to U.S. Dollars.

 

1.3        Accounting
Terminology. All accounting terms used in the Loan Documents shall be construed, and all financial records and reports prepared
or provided pursuant to the Loan Documents shall be prepared, in accordance with GAAP.

 

1.4        Computation
of Interest and Time Periods. Under the Loan Documents, interest shall accrue and be calculated at a rate per annum based on
the actual number of days elapsed and a 360-day year. Anything in the Loan Documents to the contrary notwithstanding, interest
shall not accrue thereunder at a rate in excess of the maximum rate, if any, that is permitted under applicable law, and shall
be deemed automatically capped at the relevant maximum rate in effect, if any, from time to time. At no time shall the interest
rate payable on the Advance, together with the late payment fees and prepayment fees that accrue under, and all other amounts payable
under the Loan Documents to the Lender, to the extent the same are construed to constitute interest, exceed the maximum rate of
interest that at any time may be contracted for, taken, charged or received by the Lender under the Loan Documents under applicable
law. If for any period during the term of this Agreement any amount paid to the Lender under the Loan Documents (to the extent
the same shall (but for the provisions of this Section) constitute or be deemed to constitute interest) would exceed the maximum
amount of interest permitted during such period, then such excess amount shall be applied or shall be deemed to have been applied
as a prepayment of the Advance in such order as the Lender shall determine. In computations of interest or time under this Agreement
“from” means “from and excluding,” and “to” or “through” means “to and including.”
For the calculation of the duration of a monthly period, a month commencing on one numeric day of a calendar month shall end on
the same numeric day of the next calendar month, if any, or else the last day of the next calendar month.

    	8

    	 

    

 

1.5        Construction.
In this Agreement, unless expressly stated otherwise: (a) references to articles, sections, exhibits and schedules, are references
to articles, sections, exhibits, and schedules of this Agreement, and references to “herein,” “hereof,”
and “hereto” are references to this Agreement as a whole; (b) the terms “include,” “including”
and similar terms shall be construed as if followed by the words “but not limited to”; (c) the term “documents”
includes any and all instruments, documents, charters, leases, contracts, agreements, certificates, notices, reports, financial
statements and other writings, however evidenced, whether in physical or electronic form; (d) references to execution of documents
shall include obtaining notarial acknowledgements thereof in accordance with applicable law as required by Lender; (e) words denoting
the singular shall include the plural, and vice versa, and words denoting any gender shall include all genders; (f) captions of
articles and sections of this Agreement are inserted for convenience of reference only and shall not be considered in the interpretation
or construction of this Agreement; (g) references to agreements and other contractual instruments shall be deemed to include such
agreements and other instruments as assigned, assumed, amended, renewed, replaced, or otherwise modified from time to time, but
only to the extent that the assignments, assumptions, amendments, renewals, replacements, novations, and other modifications are
not prohibited by any Loan Document; and (h) references to the accrual of interest include reference to the applicable loan margins
and increases in interest relevant to an Event of Default, as provided in the Loan Documents. In this Agreement “law”
includes (i) all international, foreign, U.S. federal, state and local statutes, treaties, rules, guidelines, regulations, ordinances,
codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental
Authority, court, administrative or other governmental tribunal charged with the enforcement, interpretation or administration
thereof, (ii) all applicable administrative orders, directed duties, requests, and Permits of, or issued by, any Governmental Authority,
in each case whether or not having the force of law, and (iii) any particular law shall include all recodifications, amendments,
consolidations, replacements, and supplements thereto and thereof, and interpretations of such law by relevant Governmental Authorities.
Each party to the Loan Documents has had an opportunity to review and revise them, so the rule of construction to the effect that
any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation or construction of the
Loan Documents. Time is of the essence of the Loan Documents.

 

ARTICLE II

LOAN

 

2.1       Loan Advance.

 

(a)       Loan
Advance. Lender agrees, on the terms and conditions set forth herein, to advance to Borrower, in a single advance, $9,120,000.00
(the “Advance”). The Advance shall be disbursed for the account of Borrower in accordance with an executed request
therefor in substantially the form attached hereto as Exhibit A (“Request for Advance”).

 

(b)       Principal
Repayments. The Advance shall be repaid in installments as follows: principal installments of $356,000.00 shall be repaid on
the first day of each June, September, December and March commencing with June 1, 2011 until the principal of the Advance is fully
repaid, provided, the final installment of all principal then outstanding, shall be repaid in full on March 1, 2016. Once
repaid no portion of the Advance may be reborrowed.

    	9

    	 

    

 

 

(c)         Interest.

 

(i)       Interest
Rate. Interest shall accrue on the outstanding principal of the Advance from February 28, 2011 (or such later date as the Advance
is disbursed to a bank in Greece in preparation for Closing) until the principal is fully repaid, at the rate of eight and 16/100ths
percent (8.16%) per annum (the “Interest Rate”), provided, however, that after the occurrence
and during the continuance of an Event of Default, in the exercise of Lender’s sole discretion, the Interest Rate shall be
increased by the five percent (5%) (such resulting rate being the “Default Rate”), provided, further, in
no event shall the Advance or any other amount owing under the Loan Documents accrue interest in excess of the maximum amount,
if any, that is permitted by law. Interest shall accrue and be calculated at a rate per annum based on the actual number of days
elapsed and a 360-day year.

 

(ii)       Interest
Payments. On each date on which a payment of principal is due under this Agreement, Borrow shall also make payment of all interest
that has accrued and that remains unpaid as of that date.

 

2.2        Payments;
Late Payments; Business Days. If any payment to be made by Borrower under the Loan Documents shall fall due on a day other
than a Business Day, payment shall be made on the next following Business Day. Principal payments made more than five (5) Business
Days’ late shall incur a late payment fee of five percent (5%) of the amount that is late, which shall be due concurrently
with the late payment, without limiting Lender’s rights to interest or default interest, or the right to exercise any of
its other rights, powers, and remedies for default.

 

2.3        Application
of Payments. Unless the application of payments received on account of the Obligations in advance of an Event of Default are
otherwise specified by another provision of the Loan Documents, all payments and other funds received on account of the Obligations
(including insurance proceeds, proceeds of Requisition of the Vessel, proceeds of disposition of or realization on Collateral,
and other proceeds of collection), together with the proceeds of any claims for damages received by the Lender pursuant to or under
the terms of the Loan Documents, shall be applied as follows:

 

first, toward the payment
of the fees, costs and other expenses (including attorneys’ fees and expenses), and interest thereon, that are owed by Borrower
and that are outstanding under the Loan Documents at the time, and, as required by Lender from time to time, to provide adequate
indemnity against Encumbrances claiming priority over Lender’s security in any Collateral, provided that unless an
Event of Default has occurred and is continuing said sums shall not be used to satisfy or provide indemnity against or security
for Permitted Encumbrances;

 

second, toward interest
that accrues on the Obligations;

    	10

    	 

    

 

third, toward payment of
the principal of the Advance; and

 

fourth, to the Borrower
or to whomsoever may be entitled thereto.

 

When applied to the Advance, payments and prepayments shall
be applied in the reverse order of the maturity of the installments thereof.

 

2.4        Prepayment.

 

(a)        Required
Prepayments. At six-month intervals after Closing Borrower shall provide to Lender a written appraisal of the Vessel that is
prepared by an appraiser listed in Schedule 2.4, and dated not more than fourteen days before it is given to Lender. In
lieu of the foregoing, or in the event that Borrower fails to timely deliver any required appraisal, the Lender may have the Vessel
appraised, at Borrower’s expense, by an appraiser selected by Lender in the exercise of its sole discretion. In either event
the Borrower shall make the Vessel available for inspection (without being required to delay a departure for, or deviate from,
a voyage under the Sub-COA, or to specially dry dock the Vessel), but for this purpose such an inspection shall not be required
unless requested by Lender. The appraiser shall determine the fair market value of the vessel on a lien- and charter- free basis,
assuming a willing buyer and a willing seller not under a compulsion to sell. If that valuation is an amount that is less than
seventy percent (70%) of the outstanding principal of the Advance at the time the appraisal is made, and if demanded to do so by
Lender, Borrower shall, within sixty (60) days after receiving notice thereof and a copy of the appraisal, either (i) prepay an
amount such that, after such prepayment is first applied to outstanding interest at the time the prepayment is made and the balance
is applied to the principal of the Advance, the outstanding amount of the Advance shall not exceed seventy percent (70%) of the
appraised value of the Vessel, or (ii) Borrower shall provide further security to Lender that is of a type, value, and that is
subject to a first priority perfected security interest in favor of Lender, acceptable to Lender in the exercise of its sole discretion.

 

(b)       Voluntary
Prepayments. Borrower may make voluntary prepayment of the Advance and all accrued unpaid interest thereon in whole but not
in part on March 1, 2013, March 1, 2014, or March 1, 2015 (or the first Business Day thereafter), by first providing to Lender
sixty (60) days’ advance written notice of Borrower’s intention to do so. Once such notice is given for any prepayment,
Borrower is obligated to make such prepayment on the date so indicated.

 

(c)       Other
Prepayments; Prepayment Fee. In the event the Advance is prepaid pursuant to Sections 2.4(a) or (b), or as a result of receipt
by Lender and application of proceeds of insurance, foreclosure or other realization on Collateral, collection actions with respect
to an Obligation, proceeds of Requisition, a payment from Bankruptcy or Other Proceedings, prepayment compelled by law, or any
other mandatory or involuntary prepayment, Borrower shall, concurrently with Lender’s receipt of such prepayment, pay a
prepayment fee calculated as the difference between X and Y, with the variables X and Y defined as follows:

    	11

    	 

    

 

X equals all future scheduled principal and interest
payments (from the date of prepayment through March 1, 2016) related to the portion of the Advance prepaid, reduced to present
value as of the prepayment date at the rate of four and 35/100ths percent (4.35%) per annum.

 

Y equals the amount of the Advance prepaid.

 

Borrower acknowledges that the prepayment fee is intended to
compensate the Lender and is not a penalty.

 

2.5        Taxes;
Yield Protection; Illegality.

 

(a)        Taxes.

 

(i)       All
payments by Borrower to or for the account of Lender under the Loan Documents shall be made free and clear of and without deduction
for present or future taxes, duties, levies, imposts, deductions, assessments, fees, withholdings or similar charges, and all liabilities
with respect thereto, excluding taxes imposed on or measured by Lender’s net income or gross receipts, and franchise taxes
imposed on Lender (in lieu of net income taxes) by the jurisdiction (or any political subdivision thereof) under the laws of which
Lender is organized or maintains a lending office (all such non-excluded taxes, duties, levies, imposts, deductions, assessments,
fees, withholdings or similar charges, and liabilities being hereinafter referred to as “Taxes”). If Borrower
shall be required by any law to deduct any Taxes from or in respect of any sum payable under any Loan Document to Lender, (A) the
sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional
sums payable under this Section 2.5), Lender receives an amount equal to the sum it would have received had no such deductions
been made, (B) Borrower shall make such deductions, (C) Borrower shall pay the full amount deducted to the relevant taxation authority
or other authority in accordance with applicable law, and (D) within thirty (30) days after the date of such payment, Borrower
shall furnish to Lender the original or a certified copy of a receipt evidencing payment thereof. In the event and to the extent
that Lender receives, from an applicable taxing authority, a refund or credit for any Taxes so withheld and paid to a Governmental
Authority by Borrower and for which Borrower makes an additional payment to Lender under the foregoing clause (A), Lender shall
promptly make a refund to Borrower of the amount of such refund or credit.

 

(ii)         Borrower
agrees to pay all present or future stamp taxes, court or documentary taxes, and other excise or property taxes or charges or similar
levies which arise from any payment made under any Loan Document or from the execution, delivery, performance, enforcement, filing
or registration of, or otherwise with respect to, any Loan Document (hereinafter referred to as “Other Taxes”).

 

    	12

    	 

    

(iii)        If
Borrower shall be required to deduct or pay any Taxes or Other Taxes from or in respect of any sum payable to Lender under any
Loan Document, Borrower shall also pay to Lender, at the times interest is paid, such additional amounts that Lender specifies
as necessary to preserve the after-tax yield (after factoring in all Taxes, Other Taxes, and taxes imposed on or measured by net
income or gross receipts, and franchise taxes) Lender would have received if such Taxes or Other Taxes had not been imposed.

 

(iv)        Borrower
agrees to indemnify Lender for (A) the full amount of Taxes and Other Taxes (including any Taxes or Other Taxes imposed or asserted
by any jurisdiction on amounts payable under this Section 2.5) paid by Lender, (B) amounts otherwise payable under this Section
2.5, and (C) all liabilities (including penalties, interest and expenses) arising therefrom or with respect thereto, in each case
whether or not such Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.
Payment under this Section (iv) shall be made within thirty (30) days after the date Lender makes a demand therefor.

 

(b)         Matters
Applicable to all Requests for Compensation. A certificate of Lender claiming compensation under this Section 2.5 and setting
forth the additional amount or amounts to be paid to it hereunder shall be conclusive in the absence of manifest error. In determining
such amount, Lender may use any reasonable averaging and attribution methods.

 

(c)         Survival.
All of Borrower’s obligations under this Section 2.5 shall survive repayment of the Advance and all interest thereon.

 

2.6        Wire
Transfers. If the Advance is, at Borrower’s request, to be wire transferred to Borrower or any other Person, such transfer
shall be subject to all applicable law, including the policies of the Board of Governors of the Federal Reserve System. Borrower
acknowledges that as a result thereof, the transmission of the Advance may be significantly delayed.

 

2.7        Renewal
of Credit Facilities. Borrower acknowledges that any request that it makes for a renewal, extension, or replacement of the
credit facilities contained in this Agreement shall be granted or withheld by Lender in the exercise of Lender’s sole discretion.

 

2.8        Conditions.
Lender shall not be required to make the Advance unless at such time: all Conditions Precedent that are relevant to the Advance
have been timely fulfilled; none of the covenants, representations or warranties of Borrower or any other Person other than Lender
that are contained in the Loan Documents shall have been materially breached or shall be materially untrue; no Default or Event
of Default shall have occurred and be outstanding; and all other requirements set forth in the Loan Documents shall be satisfied
in all material respects; provided that any of the foregoing may be waived by the Lender if done in writing. Other than as expressly
set forth herein, Lender shall be under no obligation to make advances to Borrower, and no other advances made by Lender apart
from the requirements of this Agreement shall be deemed to establish any contrary practice, course of dealing or obligation.

 

ARTICLE III

CONDITIONS PRECEDENT

 

3.1        Conditions
Precedent to the Advance. Lender’s obligation to make the Advance under this Agreement shall be subject to the fulfillment,
on or before March 15, 2011 (or such later date as Lender approves in writing), of all of the following conditions precedent, and
all other conditions precedent that may be contained in any of the Loan Documents:

 

    	13

    	 

    

 

(a)         General
Documents. Borrower shall furnish to Lender the following in form and substance satisfactory to Lender, dated as of Closing,
unless otherwise indicated below:

 

(i)       the
Request for Advance;

 

(ii)      a
First Naval Mortgage encumbering the Vessel, duly executed by Borrower in substantially the form attached hereto as Exhibit
B, that has been notarized and legalized, and stamped with a consular registration number by the Panamanian consul in Greece
as preliminarily registered (the “Mortgage”);

 

(iii)     an
Assignment of Charter, Earnings and Insurances executed by Borrower in substantially the form attached hereto as Exhibit C
(the “Borrower’s Earnings Assignment Agreement”);

 

(iv)     a
certification that an executed Notice of Assignment in substantially the form of Exhibit A to Exhibit C hereto was delivered to
Charterer, and that an Acknowledgement and Agreement executed by Charterer in substantially the form of Exhibit B to Exhibit C
hereto;

 

(v)     an
Assignment of Contract of Affreightment, Earnings and Insurances executed by Charterer in substantially the form attached hereto
as Exhibit D (the “Charterer’s Earnings Assignment Agreement”);

 

(vi)     a
certification that an executed Notice of Assignment in substantially the form of Exhibit A to Exhibit D hereto was delivered to
Phoenix, an Acknowledgement and Agreement executed by Phoenix in substantially the form of Exhibit B to Exhibit D hereto;

 

(vii)    a
Manager’s Undertaking executed by Seamar Management S.A., in substantially the form attached hereto as Exhibit E;

 

(viii)   a
Manager’s Undertaking executed by Phoenix, in substantially the form attached hereto as Exhibit F;

 

(ix) a Funds Deposit Agreement
executed by Borrower, Charterer, Phoenix, Allseas, and Lender, in substantially the form attached hereto as Exhibit G (the
“Funds Deposit Agreement”);

 

(x) a copy of a letter executed
by Phoenix, addressed to Mid-Ship Group LLC, that instructs Mid-Ship Group LLC to remit all freights and other sums paid by Noranda
Alumina LLC under the COA, less commissions retained by Mid-Ship Group LLC under the COA, to the Bulk Discovery Freights Account,
in form acceptable to Lender;

 

    	14

    	 

    

 

(xi)        charge
over Shares regarding all of the issued and outstanding shares of stock in Borrower, executed by Pledgor in substantially the form
attached hereto as Exhibit H (the “Shares Charge”), and (A) a Shareholder’s Proxy executed by Pledgor
in substantially the form attached to the Shares Charge, (B) a Share Transfer Form executed by Pledgor in substantially the form
attached to the Shares Charge that pertains to the shares subject to the Shares Charge, (C) all share certificates for all issued
an outstanding shares of stock of Borrower, (D) an Undertaking executed by Pledgor in substantially the form attached to the Shares
Charge, and (E) undated Director & Officer Resignation Letters executed by all of the directors and officers of Borrower in
substantially the form attached to the Shares Charge;

 

(xii)        a
Charge Over Cash Deposit executed by Borrower, Lender, and HSBC Bank Bermuda Limited in substantially the form attached hereto
as Exhibit I;

 

(xiii)       a
Charge Over Cash Deposit executed by Allseas, Lender, and HSBC Bank Bermuda Limited in substantially the form attached hereto as
Exhibit I (the “Allseas Charge on Cash Deposit”);

 

(xiv)      an
irrevocable consent to appointment as registered agent for service of process on Borrower, Pledgor, Allseas, and the Guarantors,
executed by Leicht & Rein (“Process Agent”), in form acceptable to Lender (“Process Agent Appointment”);

 

(xvi)      copies
of the executed Time Charter, Technical Management Agreement, and Commercial Management Agreement certified by an officer of Borrower
or another individual acceptable to Lender;

 

(xvii)     copy,
certified by Charterer or another individual acceptable to Lender, of the executed Sub-COA;

 

(xviiii) copy, certified by Phoenix
or another individual acceptable to Lender, of the executed COA;

 

(xix) certified copies of all
entries and filings in respect of each of Borrower, Holding Company, Pledgor, and Allseas on file in the Register of Companies
at the office of the Registrar of Companies in Hamilton, Bermuda;

 

(xx) copies, certified by the
secretaries of the respective companies or other individuals acceptable to Lender, of the Constitutional Documents of each of Borrower,
Holding Company, Pledgor, and Allseas, and of minutes of the meetings of the board of directors of each of Borrower, Holding Company,
Pledgor, and Allseas containing, inter alia, the unanimous resolutions of the directors of each of such companies approving
such companies’ authorization of and entry into the Loan Documents to be executed on their behalf;

 

(xxi) a Certificate of Compliance
issued by the Registrar of Companies in respect of each of Borrower, Holding Company, Pledgor, and Allseas;

 

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(xxii) a certified copy of the
Register of Shareholders in respect of each of Borrower, Holding Company, Pledgor, and Allseas;

 

(xxiii) a certified copy of the
Register of Directors and Officers in respect of each of Borrower, Holding Company, Pledgor, and Allseas, certified by their respective
secretaries;

 

(xxiv) certified copy of a current
Foreign Exchange Letter issued by the Bermuda Monetary Authority with respect to each of Borrower, Holding Company, Pledgor, and
Allseas certified by their respective secretaries;

 

(xxv) a certified copy of a current
Tax Assurance issued by the Registrar of Companies for the Minister of Finance in relation to each of Borrower, Holding Company,
Pledgor, and Allseas certified by their respective secretaries;

 

(xxvi) copies of the Constitutional
Documents and public records of Charterer obtained from the Registry of Corporate Affairs and the High Court Registry of the British
Virgin Islands and certified by the secretary of Charterer;

 

(xxvii) copies of the memorandum
and articles of association and certificate of incorporation of Charter certified by the secretary of Charterer;

 

(xxviii) copy of the public records
of Charterer obtained from the Registry of Corporate Affairs in the British Virgin Islands and the public information revealed
from a search of each of the Civil Index Book and the Commercial Book, each from the date of the Charterer’s incorporation,
maintained by the British Virgin Islands’ High Court Registry;

 

(xxix) a certificate of the secretary
of the Charterer identifying, inter alia, the directors, officers, and shareholders of Charterer;

 

(xxx) a copy certified by the
secretary of the Charterer of the written resolutions of the directors of Charterer approving, inter alia, the Charterer’s
authorization of and entry into the Loan Documents to be executed for and on behalf of Charterer;

 

(xxxi) a copy of the register
of the members of Charterer certified by the secretary of Charterer;

 

(xxxii) a copy of the register
of the directors of Charterer certified by the secretary of Charterer;

 

(xxxiii) a Certificate of Good
Standing for Phoenix issued by the Division of Corporations of the Delaware Department of State on or about the date of Closing;

 

    	16

    	 

    

 

(xxxiv) a copy of the Certificate
of Formation of Phoenix, as amended and restated, issued by the Division of Corporations of the Delaware Department of State on
or about the date of Closing;

 

(xxxv) a certificate of a manager
or officer of Phoenix that:

 

(A)         attaches
a true and complete a copy of the Certificate of Formation of Phoenix, as amended and restated;

 

(B)         attaches
a true and complete copy of the limited liability company operating agreement for Phoenix, as amended and restated;

 

(C)         attaches
a true and complete copy of resolutions of the members and manager of Phoenix that authorizes the execution and delivery of a the
Loan Documents which this Agreement contemplates that it will execute and deliver, and that certifies that such resolutions are
in full force and effect; and

 

(D)         verifies
the incumbency and signature of the individual who executes Loan Documents on behalf of Phoenix;

 

(xxxvi) certified true copies
of executed powers of attorneys appointing all attorneys-in-fact who executed Loan Documents on behalf of Borrower, Holding Company,
Pledgor, Allseas and Charterer;

 

(xxxvii) certifications of the
signatures of all individuals who execute Loan Documents on behalf of Borrower, Holding Company, Pledgor, Allseas, or Charterer;

 

(xxxviii) legal opinions of counsel
in Bermuda, the British Virgin Islands, and Panama that are acceptable to Lender, in form acceptable to Lender, regarding this
Agreement and the transactions and matters contemplated therein; and

 

(xxxix) such other agreements,
instruments, documents, and certifications as Lender may reasonably require.

 

(b)        Vessel
Documentation and Preliminary Registrations. Lender shall have received

 

(i)         certified
copies of a valid and unexpired Provisional Patente of Navigation and Registration Certificate and Radio Permit for the Vessel
that indicate that Borrower is the sole owner of the Vessel, and that the Vessel is duly registered under the laws of the Republic
of Panama,

 

(ii)        original
bill of sale for the Vessel from Antonis Special Maritime Enterprise, as seller, that has been duly executed by the seller, notarized
and legalized, and that has been executed by Borrower as the transferee, and that bears a customary dated Panamanian consular attestation
together with the acceptance of sale referred to in section (iii) below; and bearing a Panamanian consular registration number
stamp as preliminarily registered,

 

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(iii)        an
acceptance of sale of Vessel in form acceptable to Lender, executed by Borrower, and notarized and legalized;

 

(iv)        an
application for Panamanian preliminary registration of title to property executed by the Borrower and bearing a customary acknowledgement
by the Panamanian consul, and

 

(v)         either
(A) a copy, with proof of filing with the Panamanian Merchant Marine Administration, of a power of attorney granted by Borrower
to a Panamanian lawyer or law firm, designating the lawyer or law firm as the Borrower’s legal representative of the Vessel
in Panama, or (B) an original such power of attorney that has been duly executed by Borrower, and notarized and legalized.

 

(c)       Mortgage
Filing. The Mortgage shall have been duly preliminarily filed and recorded at the Public Registry of Titles and Encumbrances
of Vessels of the Panama Maritime Authority, such that it creates a duly perfected mortgage and maritime lien under the laws of
the Republic of Panama, and creates a preferred mortgage on the Vessel (as the term “preferred mortgage” is defined
at 46 U.S.C. § 31301(6)(B)), subject to no Encumbrances thereon other than Permitted Encumbrances. Lender shall have
received a certified copy of a certificate of ownership and encumbrance for the Vessel issued by the Panama Public Register Office
that indicates that Borrower is the sole owner of record of the Vessel, that the Mortgage has been duly filed and recorded at the
Panama Public Register Office, and that there are no outstanding Encumbrances of record at the Panama Public Register Office that
pertain to the Vessel.

 

(d)       Vessel
Items. Lender shall have received the results of a survey and appraisal of the Vessel, and certified copies of valid and unexpired
documents that indicate that the Vessel satisfies the requirements contained in Section 4.19, in each such case that are satisfactory
to Lender, in the exercise of its sole discretion. There shall have been no change in the condition of the Vessel or in the existence
aboard or condition of any equipment listed in such survey since the date of the surveyor’s inspection thereof, except for
ordinary wear and tear. The Vessel shall have been duly deleted from the Greek registry, free of all Encumbrances, and Borrower
shall have provided to Lender copies of all documents referred to in the Addendum No 1 Dated 14th February 2011 to the
Memorandum of Agreement dated January 26, 2011 among Antonis Special Maritime Enterprise, Borrower, Lomar Shipping and Management
Inc. and Seamar Management S.A. Lender shall have received a copy, certified by the secretary of Borrower, of the foregoing Memorandum
of Agreement, and all attachments and addenda thereto.

 

(e)       Financing
Statements. There shall have been duly filed in all jurisdictions of Lender’s choice forms of Uniform Commercial Code
financing statements pertaining to Borrower, Pledgor, Allseas and Charterer as debtors, with respect to the Collateral, in forms
required by Lender.

 

(f)       Perfection.
Borrower, Pledgor, Allseas, and Charterer shall furnish to Lender all other evidence of the perfection of the security granted
in the Collateral Documents in all jurisdictions of Lender’s choice, in form as it may require, and evidence satisfactory
to Lender that all such mortgages, assignments, and other security interests have the priority required of them herein or in the
relevant Loan Documents.

 

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(g)       Insurance.
Borrower shall have furnished to all underwriters and protection and indemnity associations Notices of Assignment as required herein,
which shall have been duly endorsed on all policies and entries. Lender shall have been furnished with certified copies of all
policies of insurance and protection and indemnity association certificates of entry that Borrower is required to procure and maintain
pursuant to the Loan Documents, along with all required endorsements thereto, a letter of undertaking from the Vessel’s protection
and indemnity association, and a letter from the Borrower’s insurance broker as required herein. Lender shall have been furnished
with certified copies of all policies of insurance that Charterer obtains for which it is required to furnish documents pursuant
to the Charterer’s Earnings Assignment Agreement (or of a certificate of entry in the case of a protection and indemnity
association), and all such documents that Charterer is required to furnish pursuant to the Charterer’s Earnings Assignment
Agreement. Charterer shall have furnished to all underwriters and protection and indemnity associations Notices of Assignment as
required therein, which shall have been duly endorsed on all policies and entries.

 

(h)       Borrower
Bank Account. Borrower shall have opened a demand deposit account with HSBC Bermuda Bank Limited for the purpose of receiving
charter hire under the Time Charter (the “Bulk Discovery Hire Account”).

 

(i)       Allseas
Bank Account. Allseas shall have opened a demand deposit account with HSBC Bermuda Bank Limited for the purpose of receiving
freights and other amounts under the Sub-COA, and for the purpose of receiving from Mid-Ship Group LLC freights and other amounts
paid by Noranda Alumina LLC, its successors and assigns under the COA (the “Bulk Discovery Freights Account”).

 

(j)        Fees
and Expenses. Borrower shall have paid (A) a commitment fee of one percent (1%) of the Advance (the “Commitment Fee”),
(B) all transaction fees payable to Lender pursuant to a fee letter executed by Lender and Borrower dated February 1, 2011 (the
“Fee Letter”), (C) all filing and recording fees, and all stamp and other taxes payable with respect to the
consummation of the transactions as contemplated in this Agreement, and (D) Lenders’ reasonable attorneys’ fees and
other expenses incurred as of Closing in connection with the transactions contemplated in this Agreement.

 

3.2        Compliance
with Loan Documents. It is a condition precedent to the Advance that the representations and warranties of Borrower and Guarantors
contained in the Loan Documents shall be true, and there shall be no outstanding Default or Event of Default thereunder by any
of the Loan Documents, and there shall not exist any Material adverse condition with respect to a Credit Party that has not been
contained in the written information about them, their assets, their businesses, and their financial condition that has not heretofore
been disclosed to Lender in writing.

 

3.3        Unfulfilled
Conditions Precedent Become Ongoing Covenants. Conditions Precedent specified in this Article III that remain unfulfilled as
of the disbursement of the Advance shall survive and shall be deemed ongoing covenants of Borrower, the performance of which shall
be due on demand, unless they are waived by Lender in writing.

 

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ARTICLE IV

REPRESENTATIONS AND WARRANTIES

 

The Credit Parties make the following representations,
warranties, and covenants in addition to those which may be contained elsewhere in the Loan Documents. All of the following and
such other representations, warranties, and covenants as such parties shall make in the other Loan Documents are continuing representations
and warranties and shall survive the Closing until all of the Obligations are fully performed:

 

4.1        Company
Matters. Borrower, Pledgor, Allseas, Phoenix, and Holding Company are each an exempted company incorporated under the laws
of Bermuda, and possesses the capacity to sue and be sued in its own name and is in good standing under the laws of Bermuda. Charterer
is an exempted company incorporated under the laws of the British Virgin Islands, and possesses the capacity to sue and be sued
in its own name and is in good standing under the laws of the British Virgin Islands. Each Credit Party, and each of Allseas and
Phoenix possesses all requisite power and authority to enter into, execute, deliver, and perform its obligations under this Agreement
and the other Loan Documents to which it is or is to become party pursuant to this Agreement and to take all action as may be necessary
to consummate the contractions contemplated thereby. The entry into, execution, delivery, and performance by each Credit Party,
and each of Allseas and Phoenix, of the Loan Documents to which it is, or, pursuant to this Agreement is to be a party, and the
transactions contemplated thereby, have been duly authorized by all necessary corporate action. This Agreement and the Loan Documents
which this Agreement contemplates that the Credit Parties, Allseas and Phoenix will execute have been duly executed by such Persons
and constitute (or shall constitute when executed and delivered) legal, valid, and binding obligations of such Persons, enforceable
against them in accordance with their terms.

 

4.2        Legal
Matters. The execution, delivery, and performance of the Loan Documents to which the Credit Parties, Allseas, and Phoenix are
or are to become party do not and will not (a) violate any provision of any law, rule, order, writ, judgment, injunction,
decree, determination or award presently in effect having applicability to them, or (b) result in a breach of or constitute a default
under any indenture, loan or credit agreement, or any other note, instrument, or agreement for borrowed money. None of the Credit
Parties, Allseas, or Phoenix are in Material violation of or Material default under any such law, rule, order, writ, judgment,
injunction, decree, determination, award, indenture, loan or credit agreement, or other note, instrument, or agreement for borrowed
money. The execution, delivery, and performance of the Loan Documents to which each of the Credit Parties, Allseas, and Phoenix
is or is to become a party do not and will not violate its Constitutional Documents, are within its powers, and have been duly
authorized by all necessary company action.

 

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4.3        Authorization;
Validity and Enforceability. This Agreement has been duly executed on behalf of Borrower and Guarantors, and constitutes a
valid obligation of each of them, and is enforceable against them in accordance with its terms. Each Loan Document, when executed
and delivered by such of the Credit Parties, Allseas, or Phoenix as are stated to be parties thereto, will be a legal, valid and
binding obligation of such of such Persons as are stated to be party thereto, enforceable against each such party in accordance
with its terms. This Agreement is not subject to any claim, defense or right of offset or recoupment of any kind whatsoever. None
of the Credit Parties, Allseas, or Phoenix has any claims, counterclaims or defenses against the Lender or any other Person that
would or might affect (1) the validity, enforceability or binding nature of any provision of any Loan Document or (2) the collectability
of any of the Obligations or any of the obligations of any Guarantor, Pledgor, Allseas, or Phoenix under the Loan Documents.

 

4.4        Lines
of Business. Borrower is engaged exclusively in the ownership and operation of the Vessel for operation in the international
bulk cargo trade, including to and from ports in the United States, and activities reasonably related thereto.

 

4.5        Government
Approvals. No Permit from, or filing or registration with any Governmental Authority is or will be necessary to the valid execution,
delivery, or performance of the Loan Documents by the Credit Parties, Allseas or Phoenix.

 

4.6        Ownership;
Subsidiaries. All Equity Interests in the Credit Parties are owned as set forth in Schedule 4.6. Borrower has no Subsidiaries
other than as set forth in Schedule 4.6. Except as has been disclosed to the Lender in Schedule 4.6, there are no
outstanding subscription agreements, membership interest or share purchase agreements, warrants, or options for any Equity Interests
in Borrower. Allseas and Phoenix are, directly or indirectly, wholly-owned subsidiaries of Holding Company.

 

4.7        Financial
Condition. All financial information heretofore given to Lender by Borrower or any of its Affiliates pertaining to Borrower
or any other Person reasonably and accurately reflected the facts stated therein or represented thereby as of the dates of such
financial information, and was prepared in accordance with GAAP, and was otherwise prepared in a manner that is consistent with
the financial information with which Lender has been provided heretofore, except as otherwise expressly noted therein. At such
dates there were no omissions of material facts or materially erroneous statements therein or therefrom, as determined in accordance
with GAAP.

 

4.8        Legal
Actions. There are no actions, suits, or proceedings pending or threatened against any of the Credit Parties or any of their
assets, before any court, administrative or other tribunal, arbitrator or panel of arbitrators, or Governmental Authority except
as set forth in Schedule 4.8 hereto.

 

4.9        Title
and Encumbrances. Borrower has good and merchantable title to all of the Collateral except Collateral owned by Pledgor, Charterer,
or Allseas. Pledgor has good and merchantable title to all of the Equity Interest in Borrower, and all Collateral related thereto.
Charterer has good and merchantable title to the Time Charter, all other Collateral described in the Charterer’s Earnings
Assignment Agreement, and all Collateral related thereto. Allseas has good and merchantable title to the deposit account described
in the Allseas Charge on Cash Deposit, and all Collateral related thereto. None of Borrower’s assets or any of the other
Collateral are subject to any Encumbrances except (a) Encumbrances in favor of Lender, (b) Encumbrances listed in Schedule
4.9, and (c) Encumbrances expressly permitted in any Loan Documents (each, a “Permitted Encumbrance”).

 

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4.10         Contracts.
None of the Time Charter, Technical Management Agreement, Commercial Management Agreement, Sub-COA, and COA have been assigned,
assumed, amended, renewed, replaced, or otherwise modified.

 

4.11         Place
of Business. Borrower’s, Charterer’s and Allseas offices where they keep their books and records pertaining to
deposit accounts and general intangibles owing or belonging to them, and all other records contemplated in Section 5.9 are located
at the address of Borrower stated in Section 9.4, and their chief executive offices and places of business are located at the locations
stated in Schedule 4.11.

 

4.12         Disclosure.
All written statements, representations, and warranties made by the Credit Parties, Allseas, and Phoenix in the Loan Documents
are materially true, and do not omit any material facts on the date as of which such information was stated or certified.

 

4.13         Laws
and Regulations. The Credit Parties, Allseas, and Phoenix are in compliance with all applicable laws, except for any violation
of which would not subject any Collateral to forfeiture, could not subject any directors, officers, or shareholders of any of the
Credit Parties, Allseas, or Phoenix to imprisonment, and could not have a Material affect on the Credit Parties, Allseas, or Phoenix
.. Borrower is not engaged and shall not engage in the business of purchasing or carrying margin stock (within the meaning of Regulation
U issued by the Board of Governors of the Federal Reserve System), or extending credit for the purpose of purchasing or carrying
margin stock. Borrower is not subject to the Investment Company Act of 1940, the Public Utility Holding Company Act of 1935, or
any other law that restricts entering into or performing any obligation of Borrower under any Loan Document.

 

4.14         Tax
Status. The Credit Parties and their Subsidiaries have filed all tax returns and reports required to be filed, has made provision
in accordance with GAAP for the payment of all applicable and accrued or accruing foreign, U.S. federal, state and local taxes,
and has paid all such taxes which are due and payable.

 

4.15         Fiscal
Year. The Credit Parties’ and their Subsidiaries’ fiscal years for accounting and tax purposes end on December
31.

 

4.16         Intellectual
Property. The Credit Parties own or possess the right to use, all of the trademarks, service marks, trade names, and copyrights
that are reasonably necessary for the operation of their businesses, without conflict with the rights of any other Person, and
it owns no patents, patent rights, franchises, or licenses or registered trademarks, service marks, trade names, copyrights, or
other intellectual property rights.

 

4.17         ERISA
Compliance. No Credit Party or any ERISA Affiliate thereof has any Pension Plan or Multiemployer Plan.

 

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4.18    Environmental
Compliance.

 

(a)       The
Credit Parties and their Subsidiaries are in compliance in all material respects with the requirements of all applicable Environmental
Laws, the violation of which could have a Material adverse effect on their assets or business.

 

(b)       No
hazardous substances have been generated or manufactured on, transported to or from, treated at, stored at or discharged from or
on any real property or from a vessel, owned, leased or operated by any Credit Party or any of their Subsidiaries, in violation
of any Environmental Laws.

 

(c)       None
of the Credit Parties or any of their Subsidiaries have received notice or otherwise learned of any claim, demand, suit, action,
proceeding, event, condition, report, directive, Encumbrance, violation, non-compliance or investigation indicating or concerning
any potential or actual liability or remedial action arising in connection with any non-compliance with or violation of the requirements
of any applicable Environmental Laws, or the presence of, or release or threatened release of any Hazardous Materials on or from
any real property, or from a vessel, owned, leased or operated by any of the Credit Parties or any of their Subsidiaries.

 

4.19    Vessel.
The Vessel (a) satisfies the criteria to conduct the business as described in Section 4.4, including the carriage of cargo under
the Sub-COA and COA, (b) measures 9,977 light ship tons and 69,349 deadweight tons, (c) is in class BV + I 3/3 Bulk Ore Carrier,
Deep Sea, AU-MS of Bureau Veritas, and is so certified, without any outstanding exceptions or recommendations, and (d) has, and
Borrower has possession of, all required national and international certificates of financial responsibility, and all other Permits
that are required to conduct the business described in Section 4.4, including all Permits required under the laws of Panama, Jamaica,
and the United States for the carriage of cargo under the Sub-COA and COA.

 

4.20.   Land.
Charterer owns no real property in the British Virgin Islands.

 

ARTICLE V

COVENANTS

 

So long as any Obligations are outstanding
or Lender has any commitment to make the Advance hereunder, Borrower and Guarantors agree to comply with the following covenants
that are applicable to them unless otherwise agreed to in writing by Lender:

 

5.1      Title
and Liens.

 

(a)       At
Closing, Borrower shall be the sole owner of the whole of Vessel and other Collateral except Collateral owned by Pledgor, Charterer,
or Allseas, and shall thereafter retain good and marketable title thereto, subject to no Encumbrances except Permitted Encumbrances;
and

 

    	23

    	 

    

 

(b)       At
Closing, Charterer shall have good and merchantable title to the Time Charter, all Collateral described in the Charterer’s
Earnings Assignment Agreement, and all Collateral related thereto, and shall thereafter retain good and marketable title thereto,
subject to no Encumbrances except Permitted Encumbrances.

 

(c)       The
Greek business day after Closing, Borrower shall deliver to Lender a certificate of the deletion of the Vessel from the Greek registry,
that has been notarized and legalized, showing that the last record owner of the Vessel was Antonis Special Maritime Enterprise,
and that when the Vessel was deleted from Greek registry, it was free and clear of liens and mortgages of record.

 

5.2        Change
in Business. Borrower shall not engage in any trade or business in which it is not currently engaged. Borrower shall not change
the location of its chief executive office or the office where it keeps its books and records pertaining to accounts and general
intangibles owing or belonging to it without giving Lender at least thirty (30) days’ advance written notice.

 

5.3        Financial
Covenants. Holding Company shall maintain a ratio of EBITDA to Fixed Charges for each fiscal year of not less than 1.2 : 1.
Holding Company shall at all times have shareholders’ equity of not less than $10,000,000.00, determined in accordance with
GAAP.

 

5.4        Company
Matters.

 

(a)       Without
the written consent of Lender previously obtained, Borrower shall not, and shall not allow any of its Subsidiaries to:

 

(i)        make
any Investments except for Permitted Investments or Investments otherwise permitted by this Agreement;

 

(ii)         incur
any Indebtedness (other than borrowing funds under this Agreement), make any loans or advances, or extend credit to any Person;

 

(iii)        acquire
any Equity Interests, create any Subsidiaries, or contribute to the equity of any Person;

 

(iv)        declare
or pay any dividends, distribute any equity, or make any other distributions to its shareholders or members;

 

(v)         redeem
any Equity Interests;

 

(vi)        change
its fiscal year or make any material change in its method of accounting;

 

(vii)       merge,
consolidate or amalgamate with or into any other Person, change the legal nature of its form of entity, or change its jurisdiction
of formation;

 

    	24

    	 

    

 

(viii)      liquidate
or dissolve;

 

(ix)         sell
or dispose of any assets other than equipment that is obsolete, or worn out, or no longer necessary for the conduct of Borrower’s
business or the operation of the Vessel, however, if such equipment that is disposed of is equipment of the Vessel, such equipment
shall be concurrently replaced with equipment of equal value;

 

(x)       grant
any Encumbrance on any of its assets except Permitted Encumbrances; or

 

(xi)         incur
or pay any management fees or commissions to any Person other than pursuant to the current express provisions of the Technical
Management Agreement and the Commercial Management Agreement.

 

(b)       Borrower
shall pay all of its obligations as they mature, provided, it may contest obligations in good faith if appropriate reserves
therefor are established and maintained consistently with GAAP, and security therefor is posted as may be required by Lender.

 

5.5      Financial
Statements/Reporting Requirements. Each of Borrower (on a stand alone basis and on a consolidated basis as to it and its Subsidiaries,
if any), Holding Company (on a consolidated basis) shall deliver to Lender, in form and detail satisfactory to Lender, the following
information and documents, which shall be accurate and complete in all material respects:

 

(a)       As
soon as available but no later than seventy-five (75) days after the end of the each of its fiscal quarters, complete copies of
its financial statements, which shall include its balance sheet, income statement, a statement of changes in equity, and a statement
of cash flows for the preceding fiscal quarter, prepared in a level of detail as reasonably required by Lender, certified by its
chief financial officer or a representative acceptable to Lender as being complete and correct, and fairly presenting its and their
respective financial conditions and the results of its and their respective operations in all material respects;

 

(b)       As
soon as available but no later than one hundred eighty (180) days after the end of the each of their fiscal years, complete copies
of its financial statements, which shall include its balance sheet, income statement, a statement of changes in equity, and a statement
of cash flows for the preceding fiscal year, prepared in a level of detail as reasonably required by Lender, certified by its chief
financial officer or a representative acceptable to Lender as being complete and correct, and fairly presenting its and their respective
financial conditions and the results of its and their respective operations in all material respects, and which, as to Holding
Company, shall have been audited by an independent certified public accountant that has been selected with the written approval
of Lender;

 

(c)       On
each September 1 and March 1 of each year, a Certificate of Compliance executed by an officer Borrower (or its authorized representative
approved by Lender) in substantially the form attached hereto as Exhibit J;

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(d)       Within
thirty (30) days after they are due to be filed under applicable law, as extended pursuant to any valid extensions, copies of the
income tax returns for Borrower and Guarantors in each relevant jurisdiction for each of their fiscal years ending after the date
of this Agreement, and, if filing extensions are requested, Borrower and Guarantors shall furnish Lender forthwith with copies
of all related extension applications and approvals;

 

(e)       Within
ten (10) days after becoming aware of any of the following, written notice to Lender of:

 

(i)       all
Material breaches of contract to which Borrower is a party,

 

(ii)      any
Material disputed account receivable,

 

(iii)     the
institution of any litigation or arbitration to which Borrower is a party or which affects any of its assets (including by means
of counterclaim, cross claim, impleader, or interpleader), in which the claim against the Borrower or a Guarantor is in excess
of $1,000,000.00,

 

(iv)     the
revocation, modification, rescission or failure to renew of any Permit issued to Borrower or the Vessel,

 

(v)      the
occurrence of any Default or Event of Default, together with a detailed statement of the steps being taken by the defaulting party
to deal with any such Default or Event of Default,

 

(vi)     any
change in the jurisdiction of a Credit Party’s formation, or location of Borrower’s or Charterer’s chief executive
office or the office where it keeps its books and records pertaining to accounts and general intangibles owing or belonging to
it, or of the establishment of any new, or the discontinuance of any existing, place of business of Borrower or Charterer,

 

(vii)    the
death of Edward Coll or Claus Boggild, or the disablement of one them such that he may no longer effectively participate in the
management of Holding Company,

 

(viii)   the
occurrence of damage to the Vessel in excess of the amount of the deductible or franchise amount of the hull and machinery insurance
thereon; a total loss of the Vessel occurs, an incident of salvage or general average occurs with respect to the Vessel,

 

(ix)     after
receiving knowledge of a Requisition of the Vessel, or knowledge that a Governmental Authority intends to effect a Requisition
of the Vessel (which shall be accompanied by a copy of the relevant communications received),

 

(x)       after
the occurrence of any discharge from the Vessel of any Hazardous Material into the environment,

 

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(xi)      after
receipt of any notice from any Governmental Authority of any illegal act, omission, or condition by or concerning the Vessel or
its officers, crew, or cargoes,

 

(xii)     if
any material requirement of any of Governmental Authority or classification society with respect to the Vessel is made that is
not complied with, or any Governmental Authority or classification society issues a recommendation or exception with respect to
a certification or Permit pertaining to the Vessel that is not complied with or rectified (which shall be accompanied by a copy
of the relevant communications received), or if any classification certificate for the Vessel is terminated,

 

(xiii)    if
the Vessel is Seized,

 

(xiv)    the
occurrence of an Event of Default or any event or condition which, with the passage of time, the giving of notice, or both, would
become an Event of Default, and

 

(xv)     any
other matter which has resulted or might result in a Material adverse change in the financial condition or business of Borrower.

 

Borrower shall provide to Lender copies of all Form
CG-2692 accident reports (and all similar reports filed outside the United States) within five (5) days after submitting them to
the United States Coast Guard, and copies of all periodic classification society, damage, and insurance surveys that are prepared
for the Vessel; and

 

(f)       Such
other statements, lists or property and accounts, budgets, forecasts, reports or other financial information as are regularly made
or maintained by Borrower as Lender may from time to time request.

 

5.6        Fiscal
Year. No Credit Party shall change its fiscal year, nor shall it permit any Subsidiary thereof to do so, without the advance
written consent of Lender.

 

5.7        Accuracy
of Financial Information. All financial information hereafter given to Lender by Borrower, Guarantor, or any accountant, or
other professional therefor pertaining to Borrower, Guarantor, or any Subsidiary thereof shall reasonably and accurately reflect
the facts stated therein or represented thereby as of the dates of such financial information subject to, in the case of non-fiscal
year-end information, normal year-end adjustments, and shall be prepared in accordance with GAAP and otherwise in a manner that
is consistent with the financial information with which Lender has been provided heretofore. There shall be no omissions of material
facts therefrom, determined in accordance with GAAP, and there shall be no material and erroneous statements therein, determined
in accordance with GAAP.

 

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5.8        Access.
The Borrower and Guarantors, shall cause their presidents, chief executive officers, chief financial officers, and authorized representatives
(and Holding Company shall cause the presidents, chief executive officers, chief financial officers, and authorized representatives
of Allseas and Phoenix, and the Persons with custody of or control over the books and records referred to in Section 5.9 pertaining
to Allseas and Phoenix), to be available during customary office hours at least once each fiscal quarter for a conference with
a representative of Lender for the purpose of discussing the financial affairs of Borrower (and any Subsidiaries of Borrower that
may exist from time to time), Guarantors, Allseas, Phoenix.

 

5.9        Accounting
Records. Borrower and Guarantors shall maintain, and shall cause their Subsidiaries to maintain, adequate books, accounts and
records of all of their financial transactions and their assets and businesses, and prepare all financial statements, all in accordance
with GAAP and in compliance with the regulations of every Governmental Authority or other regulatory body having jurisdiction over
it or them or its or their businesses. Borrower and Guarantors shall permit, and cause their Subsidiaries to permit, employees
or agents of Lender at such reasonable times as Lender may request to inspect their assets, including without limitation regular
collateral audits, and to examine, audit, and make copies and memoranda of its and their documents, books, accounts and records,
including those kept in electronic form. None of Borrowers or Guarantors shall make or permit any material change in their accounting
policies or reporting practices, and shall ensure that none of their Subsidiaries do so, except (i) as required by generally accepted
accounting principles or (ii) with the prior written consent of the Lender, which consent shall not unreasonably be withheld.

 

5.10         Status.
Borrower and Guarantors shall maintain, and shall cause their Subsidiaries to maintain, in full force and effect their corporate
existences, and shall maintain their qualifications to do business as foreign corporations in each jurisdiction in which the character
of the assets owned by them or the nature of their activities make such qualification necessary to avoid a material adverse effect
on them.

 

5.11         Condition
of Assets. Borrower and Guarantors shall maintain all of its assets that are necessary or useful in the proper conduct of its
business in good working order and condition, normal wear and tear and excepted.

 

5.12         Legal
Compliance. Borrower and Guarantors shall, and shall cause each of their Subsidiaries to, comply with the requirements of all
applicable law, and judicial, arbitral, and governmental rules, orders, writs, judgments, injunctions, decrees, determinations
and awards. Borrower and Charterer bear sole responsibility for compliance with or obtaining all Permits as may be necessary under
applicable contracts and law with respect to the security granted by them to Lender in the Collateral.

 

5.13         ERISA
Plans. No Credit Party shall have, or permit any Subsidiary thereof to have any Pension Plan or Multiemployer Plan.

 

5.14         Taxes.
Prior to the date on which they became delinquent, Borrower shall duly pay, and discharge, and shall cause each of its Subsidiaries
to pay and discharge, all taxes, duties, levies, imposts, deductions, assessments, fees, withholdings, user fees, and other governmental
charges imposed upon it or upon its income or profits, upon its or their activities, or upon any assets belonging to it or them,
provided, Borrower and its Subsidiaries may contest in good faith any such claims and taxes, duties, levies, imposts, deductions,
assessments, fees, withholdings, user fees, and other governmental charges if appropriate reserves therefor are established and
maintained consistently with GAAP, and provided, further, if an Encumbrance on Collateral arises in respect thereto, Borrower
shall post, or shall cause its Subsidiary to post, security sufficient to ensure that the Governmental Authority asserting the
claim, or any successor or assign thereof, will not enforce an Encumbrance against the Collateral.

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5.15         Permits.
Borrower and Charterer shall obtain and maintain in full force and effect all of its Permits in effect on the date hereof or at
Closing, and such others as are necessary to allow it to conduct the business contemplated in Section 4.4. Borrower and Charterer
shall not operate, and shall not allow the Vessel to be operated, without a Permit in violation of applicable law. None of Borrower
or Charterer shall sell, subject to any Encumbrance, or otherwise transfer any such Permit or any right, title, or interest therein,
thereto, or thereunder.

 

5.16         Intellectual
Property. Borrower and Guarantors shall not, sell, transfer, encumber, or otherwise dispose of any of its or their rights,
title, or interest in any trademarks, service marks, trade names, copyrights, patents, patent rights, franchises, licenses and
other intellectual property rights and assets that are reasonably necessary for the operation of its or their businesses, except
transfers of such property to Borrower.

 

ARTICLE VI

VESSEL PROVISIONS

 

On, and from and after Closing, Borrower
represents, warrants, and agrees as follows (and shall cause all managers and operators of the Vessel to ensure compliance with
the following provisions on behalf of Borrower):

 

6.1        Vessel
Registry. Borrower shall keep the vessel fully documented under the Panamanian registry, including all additional certifications
required for vessels of its type, tonnage and area of operation, under the laws of and international conventions approved by the
Republic of Panama.

 

6.2.       Ownership
and Encumbrances. Borrower is the sole owner of the whole of the Vessel free and clear of all Encumbrances except Permitted
Encumbrances, and is lawfully possessed of the Vessel and warrants and shall defend its title to and possession thereof and every
part thereof for the benefit of Lender against the claims and demands of all persons whomsoever. No Encumbrances shall exist hereafter
against the Vessel except for Permitted Encumbrances, and none of Borrower or the master of the Vessel nor any other Persons have
or shall have any right or authority to create, incur or permit to be placed or imposed upon the Vessel, or any part of any of
the Vessel, any Encumbrance whatsoever other than Permitted Encumbrances. Borrower shall pay and discharge, or cause to be paid
and discharged, when due and payable, from time to time, all Encumbrances on the Vessel except when the continuation of such an
Encumbrance is otherwise permitted in this Agreement.

 

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6.3.       Transfers.
There are no outstanding charters, contracts of affreightment, or other rights to possession of or services of the Vessel other
than as listed in Schedule 4.9. Borrower shall not sell, convey, mortgage, or charter the Vessel or any portion thereof,
or transfer any interest therein in any manner (including by grant of an option, right of first refusal, or restriction on transferability),
without the written consent of Lender being first obtained (except that Permitted Encumbrances are permitted), provided,
sub-time charters, voyage charters, and contracts of affreightment may be entered into by Charterer with the prior written consent
of Lender granted or withheld in the exercise of its sole discretion. No such written consent to any such sale, conveyance, mortgage,
charter, or transfer shall be construed to be a waiver of this provision in respect to any subsequent proposed sale, conveyance,
mortgage, charter, or transfer. Borrower shall repay all of the Obligations concurrently with a sale or other transfer of title
to the Vessel. Each other mortgage, charter, or transfer shall be subject to the provisions of the Mortgage and the lien it creates.

 

6.4        Lawful
Operation. The Vessel and its operations shall at all times comply with (a) all laws of the Republic of Panama, all applicable
treaties and conventions, and all applicable rules and regulations thereunder, as in effect from time to time, and (b) all laws
and regulations applicable to the Vessel and its operation in all trades and locations in which it operates or is located from
time to time; and the Vessel shall have on board as and when required thereby valid certificates of inspection and all other certificates
evidencing compliance therewith. Borrower shall obtain and file all certificates of financial responsibility as legally required
in all jurisdictions in which the Vessel is located from time to time. Borrower shall prepare and file all pollution prevention
and contingency plans and take all other steps required under all applicable laws concerning the prevention and cleanup of environmental
pollution, and the regulation of shipowners and vessels with respect to environmental matters. The Vessel shall not be abandoned,
and shall not carry any passenger, cargo, or other matter that will expose it to penalty, forfeiture or capture. Borrower shall
ensure that all reasonable precautions are taken to ensure that no illegal drugs or drug paraphernalia are used or kept on board
the Vessel, and shall otherwise comply with the anti-drug policies of the United States Government.

 

6.5        Operation.
Unless otherwise agreed to in writing by Lender, granted or withheld in the exercise of its sole discretion, Borrower and Charterer
shall ensure that the Vessel shall at all times be dedicated to the performance of the Sub-COA and the COA, shall not be taken
to a zone that is a declared war zone by any government or by any of the Vessel’s war risk underwriters, and shall not be
abandoned in a port or place outside the United States. The Vessel satisfies, and shall continue to satisfy, the objective requirements
for it to be utilized under the Time Charter, Sub-COA and COA.

 

6.6        Maintenance.
The vessel has a valid classification certificate issued by Bureau Veritas, in classification BV + I 3/3 Bulk Ore Carrier, Deep
Sea, AU-MS without outstanding exceptions or recommendations. Borrower shall, at all times, and without cost or expense to Lender,
maintain such classification status, and maintain and preserve the Vessel as required in all applicable manufacturer’s manuals,
and in a safe and seaworthy condition, and in such running order and repair as would be expected of a prudent, first-class shipowner,
and in a condition, working order and repair at least as good as such Vessel is in on the date of this Agreement, ordinary wear
and tear excepted. Borrower shall not make or permit to be made any material changes to the structure, type or speed of the Vessel,
or to its propulsion system, or make any alterations to the Vessel that would change its registered length, breadth, or depth,
or its gross, net, deadweight, or lightship tonnages, without first receiving written approval from Lender. Borrower may remove
equipment from the Vessel free and clear of the lien of the Mortgage if (i) it simultaneously replaces such equipment with equipment
of the same or greater value, (ii) it causes all damage to the Vessel caused by such removal and replacement to be promptly repaired,
and (iii) such removal and replacement will not adversely affect the fair market value of the Vessel. Borrower shall cause the
Vessel to be surveyed and placed in dry dock when and as is required in order for it to maintain its classification status, and
to maintain all certificates of inspection and other certifications that is now has or is required to have in order to pursue its
intended trades.

 

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6.7        Access
and Surveys. At all times Borrower shall afford Lender or its authorized representatives and surveyors full and complete access
to the Vessel for the purpose of inspecting it and its cargoes, and papers, and making copies of such papers, and shall provide
to Lender, within seven (7) days after being so requested, copies of all contracts, charterparties, policies of insurance, evidence
of club entries, and all other documents (including records that are in electronic form) pertaining to the Vessel or its operations.
Borrower shall provide to Lender prompt advance notice of all emergency dry-dockings of the Vessel, and fourteen (14) days advance
written notice of all non-emergency dry-dockings of the Vessel. If requested by Lender Borrower shall instruct the Vessel’s
classification society to make available to Lender all of its records pertaining to the Vessel (including records that are in electronic
form), and to provide Lender with copies of all of the classification society’s communications with Borrower, its managers
or agents with respect to the Vessel.

 

6.8        Seizure;
Requisition. If the Vessel shall be Seized, Borrower, within thirty (30) days thereafter, shall cause the Vessel to be irrevocably
released and all Encumbrances thereon, other than the lien of the Mortgage, to be discharged by payment, performance, or the posting
of security therefor. In the event any of the foregoing occurs, Borrower agrees forthwith to notify Lender by facsimile or telegram,
confirmed by letter, at its address set forth in Section 9.4. In the event the Vessel shall be Seized and shall not be released
therefrom within thirty (30) days thereafter, Borrower hereby irrevocably authorizes and empowers each officer of Lender in the
name of Borrower (as attorney-in-fact, coupled with an interest) to apply for and receive possession of the Vessel, with all rights
and authority that Borrower might have, possess and exercise in any such event, but such officers shall not be under any obligation
to act in connection with the rights given in this Section. Borrower also authorizes and empowers Lender and the officials above
specified or their appointees, or any of them, to appear in the name of Borrower in any court of any country or nation of the world
where a complaint in rem or libel is pending against the Vessel, or where the Vessel is Seized or is subject to Seizure
and to take such actions as may seem proper toward the defense of such suit and the discharge of any or all Encumbrances thereon
or other relevant judgment or claim, and all expenditures made or so incurred shall be obligations due from Borrower to Lender,
shall be secured by the lien of the Mortgage, and shall accrue interest at the Interest Rate or Default Rate, as in effect from
time to time.

 

6.9        Insurance.
Borrower shall obtain insurance for its assets and liabilities as would be customary for a business of its type. Without limiting
the foregoing:

 

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(a)       Borrower
shall, while any of the Obligations are outstanding, or Lender has any commitment to advance funds under this Agreement (whether
or not there is a request for an advance outstanding), obtain and maintain the following insurances with respect to the Vessel:

 

(i)        Marine
hull and machinery insurance, and war risk hull and machinery insurance, in an amount not less than the full commercial value of
the Vessel, on a charter-free and lien-free basis, determined in a manner approved by Lender (which value shall not at any time
be an amount less than one hundred twenty percent (120%) of the principal amount of the Obligations outstanding from time to time);

 

(ii)        Protection
and Indemnity insurance purchased through a protection and indemnity association that is a member of the International Group of
P & I Clubs including but not limited to coverage for crew injuries, pollution liability including clean-up costs, wreck removal,
4/4ths collision liability, third party bodily injury and property damage insurance and war risk protection and indemnity insurance,
in such amounts per occurrence as is currently available from the protection and indemnity associations that are members of the
International Group of P & I Clubs.

 

(iii)        Loss
of earnings insurance in an amount not less than $1,350,000.00;

 

(iv)        Workers
Compensation and Employers Liability insurance for each state in or from which the Vessel shall operate, if and as required by
law, and United States Longshore and Harbor Workers’ Compensation Act insurance for statutory amounts;

 

(v)        A
separate policy of Mortgagee’s Interest Insurance with Lender as the Named Insured with respect to loss of or damage to the
Vessel in an amount at least equal to one hundred twenty percent (120%) of the principal amount of the Obligations outstanding
from time to time; and

 

(vi)        Insurance
as required by law, and insurance against any other risks to the Vessel or liabilities that could give rise to liens thereon as
from time to time required by Lender.

 

Borrower shall obtain and maintain all such
insurances at its own expense, and shall timely pay all premiums, dues, calls, assessments and other amounts and expenses thereunder,
and issue or procure all guaranties required by protection and indemnity associations with respect thereto. In the event Borrower
fails to pay such amounts, Lender shall have no responsibility to make any such payments, and no payment or undertaking to pay
any such amounts by Lender shall relieve the Borrower of its responsibility to make such payments or its responsibility under Section
7.2(c) to reimburse Lender for all such amounts that Lender pays.

 

    	32

    	 

    

 

(b)       All
policies of insurance shall be maintained in forms approved by Lender, effected by an insurance broker approved by Lender, and
contain insuring covenants, deductible or franchise clauses, mortgagee clauses, and other terms and conditions satisfactory to
Lender. No policy shall be materially amended or terminated without obtaining the prior written consent of Lender. All policies,
binders and interim contracts of insurance shall provide for fourteen (14) days’ prior written notice to be given to Lender
by the underwriters in the event of amendment or cancellation, except in the event of cancellation for nonpayment of premiums,
in which event Lender shall be furnished with not less than ten (10) days’ notice of cancellation, and in the event of cancellation
of war risk insurance, in which event Lender shall be furnished with the same advance written notice of cancellation as the relevant
policies shall provide for notices to Borrower. Certifications of all insurances required hereunder, including certified copies
of protection and indemnity association certificates of entry shall be provided to Lender forthwith upon placement of all such
insurances. Certified copies of the originals of all policies, amendments, endorsements, letters of undertaking, binders and other
interim insurance contracts shall be deposited with Lender promptly upon placement thereof, and the originals thereof shall be
furnished to Lender promptly on request. Evidence of renewal of all insurances shall be furnished to Lender not less than fourteen
(14) days prior to the expiration of all of such insurances. Borrower shall furnish evidence satisfactory to Lender whenever it
may require that all premiums, dues, assessments and other charges with respect to the insurance required herein have been fully
paid. At the option of Lender, and without waiver of any default with respect thereto, any policies of insurance required herein
and not timely obtained and properly maintained by Borrower may be obtained and maintained by Lender at Borrower’s expense.

 

(c)       Borrower
shall provide to all underwriters of the insurances a Notice of Assignment in substantially the form attached hereto as Exhibit
K, which shall be endorsed on all relevant polices and protection and indemnity association entries. All insurances shall name
Lender as an additional insured in addition to Borrower and as sole loss payee, pursuant to endorsements in substantially the form
attached hereto as Exhibit L (including a customary protection and indemnity association letter of undertaking the customary
form issued by members of the International Group of P & I Clubs, except as to: (i) mortgagee’s interest insurance,
as to which Lender shall be the sole insured and sole loss payee, and (ii) the insurance required in Section 6.9(a)(iii)
and 6.9(a) (v). No assured or loss payees shall be added to any policy without obtaining the advance written consent of Lender.
All insurance required in Section 6.9 shall be endorsed to (i) waive the underwriters’ rights of subrogation against Lender,
(ii) to provide that all such insurance is primary and non-contributory with respect to insurances placed by Lender, and (iii)
provide that Lender will not be responsible for premiums, calls, supplementary calls or similar payments. Concurrently with each
placement and, not more than fourteen (14) days before expiration of an insurance coverage that is required herein, renewal or
replacement of that insurance, Borrower shall provide to Lender a Brokers Opinion Letter in substantially the form attached hereto
as Exhibit M confirming that the insurance placed by such broker conforms to the insurance requirements herein. in a customary
form reasonably acceptable to Lender.

 

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(d)       In
the event of an actual total loss, a constructive total loss, or a compromised, agreed, or arranged total loss of the Vessel, Lender
shall receive and retain out of the insurance payments received on account of such loss an amount equal to the Obligations outstanding
at the time or that are otherwise owing under or secured by any of the Loan Documents at that time, whether or not the same are
then due and payable, and shall pay the balance as provided in Section 2.3. Lender shall have the sole right to tender abandonment
of the Vessel to its underwriters on behalf of itself and Borrower. If there has not occurred and there is not continuing an Event
of Default at the time of tender of payment by the underwriters, in the event of any other loss payable in an amount less than
$500,000.00 under any hull and machinery insurance, war risk hull and machinery insurance, or other insurance in respect of loss
of or damage to the Vessel or any of its appurtenances, or sue and labor expenses or defense costs insured thereunder, Lender shall
instruct the underwriters to pay directly for the covered repairs, replacements, expenses, or costs, or to reimburse Borrower or
Lender therefor. If there has not occurred and there is not continuing an Event of Default, and the Vessel is not an actual total
loss, a constructive total loss, or a compromised, agreed, or arranged total loss, in the event of any other loss payable in an
amount equal to or greater than $500,000.00 under any hull and machinery insurance, or war risk hull and machinery insurance, or
increased value insurance in respect of loss of or damage to the Vessel or any of its appurtenances, or sue and labor expenses
or defense costs insured thereunder, in the exercise of its sole discretion, Lender shall either instruct the underwriters to pay
directly for the covered repairs, replacements, or sue and labor expenses or defense costs insured thereunder or to reimburse Borrower
or Lender therefor, or Lender may receive all such insurance proceeds and use them to pay directly for the repairs, replacements,
or sue and labor expenses or defense costs insured thereunder, or to reimburse Borrower or Lender therefor. All claims for unrepaired
damage shall be paid to Lender, which shall apply them as provided in Section 2.3. In the event of any loss payable under any hull
and machinery insurance, war risk hull and machinery insurance, or increased value insurance not provided for above in this Section
6.9(d), in the exercise of it is sole discretion, Lender may instruct the underwriters to pay directly for the covered repairs,
replacements, expenses, or costs, or to reimburse Borrower therefor, or Lender may, in the exercise of its sole discretion, receive
all such insurance proceeds defray its own covered expenses and apply the balance toward payment of the Obligations and all sums
otherwise owing under or secured by any of the Loan Documents at the time, whether or not the same are then due and payable, in
which event the balance of the proceeds shall be applied as provided in Section 2.3. For the purpose of this clause, all hull and
machinery, war risk hull and machinery, and increased value insurance proceeds payable with respect to an occurrence and its consequences
shall be deemed to be proceeds of a single loss event.

 

(e)       In
the event that insurance moneys become due under any protection and indemnity insurance or other liability insurance coverage,
including coverage for salvage, general average, or other liabilities covered by the relevant hull insurance policy, if there has
not occurred and there is not continuing an Event of Default at the time of tender of payment by the underwriters or protection
and indemnity association, Lender shall instruct the underwriters to pay Borrower such insurance proceeds as may be due to Borrower
on account of any liability covered by such insurance if Borrower has already paid the liability, or to pay the party in respect
of whom the liability was incurred, in exchange for an appropriate release of liability with respect thereto. At such time of tender
of payment, if an Event of Default has occurred and is continuing in the exercise of Lender’s sole discretion and in lieu
of the foregoing, Lender shall be entitled to receive such insurance proceeds and may apply the proceeds thereof toward the discharge
or indemnification or reimbursement for the payment of the relevant liability, or payment of the Obligations and all sums otherwise
owing under or secured by any of the Loan Documents at the time, whether or not the same are then due and payable, in which event
the balance of the proceeds shall be applied as provided in Section 2.3 herein.

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(f)       Borrower
shall promptly file all required and customary proofs of loss and claims under all insurances, and on any failure by Borrower to
do so, Lender may do so on its and Borrower’s behalf, and is hereby irrevocably appointed as Borrower’s attorney-in-fact,
coupled with an interest, to do so.

 

(g)       In
the event the Vessel is Seized, Lender may, in lieu of the foregoing Sections 6.9(d) and (e), in the exercise of its sole discretion,
agree with any surety executing a surety bond releasing the Vessel from such attachment or arrest to hold for the benefit of such
surety any or all insurance proceeds under the policies of insurance on the Vessel as collateral security to indemnify such surety
against liability under such bond.

 

(h)       Borrower
shall not do any act or voluntarily suffer or permit any act to be done whereby any insurance shall or may be impaired, suspended,
or canceled, and shall not suffer or permit the Vessel to engage in any voyage or to engage in any trade or activity not permitted
under the policies of insurance at the time in effect without first covering the Vessel for such voyage, trade or activity with
insurances of the types, obtained from underwriters, and in the forms and amounts herein required.

 

(i)       The
acquiescence by Lender in any noncompliance in the placement of insurance in one or more instances shall not establish a consent
or course of dealing with respect to such noncompliance in any other instances.

 

6.10    Cargo.
There is no cargo aboard the Vessel as of the date hereof, and none will be loaded aboard the Vessel until after Closing.

 

ARTICLE VII

DEFAULT AND REMEDIES

 

7.1      Default.
The occurrence of each of the following events of default shall constitute an “Event of Default” as such term
is used in this Agreement:

 

(a)       Borrower
fails to make any payment of principal, interest or any other amount, as and when it becomes due to Lender under the Loan Documents,
including the Commitment Fee or any amount payable pursuant to the Fee Letter;

 

(b)       any
representation or warranty made or to be made by Borrower or any other Person (other than Lender) in any Loan Document was false
or incorrect in any material respect when made or deemed made under the provisions of any Loan Document;

 

(c)       any
of the Loan Documents, for any reason, cease to be in full force and effect or are declared to be null and void; or any Person
other than Lender that has executed a Loan Document denies that it has any or further liability or obligation under any Loan Document
which it has executed (or any provisions thereof) before full performance of all obligations thereunder;

 

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(d)       a
Credit Party, Phoenix, or Allseas: (i) applies for or consents to or becomes subject to the appointment of a receiver, trustee
or liquidator of itself, or of all or any part of its assets, or any Collateral, or becomes subject to an administration order,
(ii) makes a general assignment for the benefit of creditors, (iii) becomes or is adjudicated insolvent, (iv) commences any
Debtor Relief Proceeding in any jurisdiction, (v) becomes subject to any involuntary Debtor Relief Proceeding in any jurisdiction
and such proceeding is not dismissed within sixty (60) days after it is commenced, (vi) enters into an arrangement with a group
of creditors for the restructuring of its obligations, (vii) shall fail to pay its debts generally as they become due, (viii) if
a corporation, limited liability company, or partnership, merges or consolidates with any Person, (ix) commences a dissolution
or liquidation proceeding or is dissolved or liquidates, (x) becomes the subject of any involuntary dissolution or liquidation
proceeding and any such proceeding is not dismissed within sixty (60) days after it is commenced, (xi) commences, agrees to or
is or becomes subject to any action taken for the purpose of effectuating any of the foregoing, (xii) changes its name, and
(xiii) if a corporation, limited liability company, or partnership, reorganizes, reclassifies or recapitalizes its capital stock
or any membership or partnership interests in it;

 

(e)       the
shareholders, directors, or members of any Credit Party, Phoenix or Allseas adopts a resolution authorizing or approving of any
of the actions described in Section 7.1(d) with respect to a Credit Party;

 

(f)        Borrower
issues, redeems, purchases, retires or otherwise acquires any shares of any class of any Equity Interest in itself, enters into
any subscription agreement or other agreement for the issuance of any shares in itself, or grants or issues any warrant, right
or option pertaining thereto, or incurs any debt or obligations or issues any security that is convertible into any of the foregoing;

 

(g)       any
judgment shall be entered against a Credit Party, Phoenix, or Allseas in a Material amount that is not covered by liability insurance
with a deductible clause that has been approved by Lender in writing, and such judgment is not effectively stayed and remains undischarged
and unbonded for thirty (30) days;

 

(h)       without
Lender’s prior written consent any change shall occur in the legal structure of a Credit Party, Phoenix, or Allseas;

 

(i)       A
Credit Party, Phoenix or Allseas is or becomes in default under any loan agreement, promissory note, guaranty or other instrument
or agreement with or in favor of Lender or any Affiliate of Lender, or any Indebtedness of any third party to Lender or any Affiliate
of Lender that is guaranteed by Borrower or a Guarantor is not paid in full when due, whether on maturity, upon acceleration, or
otherwise; or Borrower or a Guarantor is or becomes in default under any preferred or other mortgage, deed of trust, assignment,
or other security agreement that secures any of its obligations with respect to any of the foregoing;

 

(j)       any
other Indebtedness of Credit Party, Phoenix or Allseas that is not subject to Section 7.1(i) in any Material amount is or becomes
due prematurely by reason of default; Borrower fails to make any Material payment thereunder on or before the due date for such
payment; or the security for any obligation of Borrower or a Guarantor, or any security therefor, becomes enforceable against any
Collateral or against a Material amount of any of its assets;

 

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(k)       without
the written consent of the Lender (i) Claus Boggild does not own at least sixty-seven percent (67%) of the Equity Interest in,
and hold at least sixty-seven percent (67%) of the voting power in Lagoa Investments Ltd., and Edward Coll, Anthony Laura, and
Lagoa Investments Ltd. do not collectively own at least fifty-one percent (51%) of the Equity Interest in, and hold at least fifty-one
percent (51%) of the voting power in Holding Company; (ii) Holding Company does not own all of the Equity Interest in and hold
all of the voting power in Bulk Partners Holding Company Bermuda Ltd, a Bermuda company; (iii) Bulk Partners Holding Company Bermuda
Ltd, a Bermuda company does not own all of the Equity Interest in and hold all of the voting power in Pledgor; (iv) Pledgor does
not own all of the Equity Interest in and hold all of the voting power in Borrower; and (v) Holding Company does not, directly
or indirectly, own all of the Equity Interest in and hold all of the voting power in Charterer and Allseas; provided, the
death of any of Claus Boggild, Anthony Laura or Edward Coll shall not cause an Event of Default under this Section 7.1(k) if there
is not an Event of Default outstanding or that results therefrom under Section 7.1(l);

 

(l)       any
of Claus Boggild, Anthony Laura, or Edward Coll becomes sufficiently disabled that he or they cannot effectively participate in
the management of Holding Company, or dies, and at least one of them, or two of them collectively, who are alive and not so disabled,
does not hold voting control over fifty-one percent (51%) of the shares of Holding Company.

 

(m)       any
judicial or nonjudicial foreclosure of or other realization upon any pledge or assignment of, or other security interest in, or
other encumbrance of any shares of the capital stock of Borrower shall be commenced or occur;

 

(n)       any
of the Time Charter, Technical Management Agreement, Commercial Management Agreement, Sub-COA (in respect of the Vessel), and COA
(in respect of the Vessel) have been or are assigned, assumed, amended, renewed, replaced, or otherwise modified without the prior
written consent of Lender;

 

(o)        a
material default by Borrower occurs under any of the Time Charter, Technical Management Agreement, Commercial Management Agreement,
or by Charterer or Phoenix under the Sub-COA (in respect of the Vessel), or by Phoenix under the COA (in respect of the Vessel)
or any such contract is terminated prematurely;

 

(p)        Any
party defaults under the Funds Deposit Agreement or any Manager’s Undertaking.

 

(q)       any
of Credit Parties or their Subsidiaries has a fiscal year-end that does not end on December 31;

 

(r)       any
Vessel becomes subject to a Seizure and is not released therefrom within thirty (30) days thereafter in the manner required in
the applicable Preferred Mortgage;

 

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(s)       a
Vessel becomes an actual total loss, or a constructive, compromised, arranged, or agreed total loss, or there is a Requisition
of the Vessel, and the Obligations are not paid in full within one hundred twenty (120) days thereafter;

 

(t)       any
Permit required in Section 4.19 or 5.15 is materially modified, becomes invalid, or is terminated;

 

(u)       the
occurrence of illegal activity which in the opinion of the Lender caused the forfeiture of or which subjects to forfeiture the
Vessel or any other Collateral;

 

(v)         the
Vessel or other Collateral is placed in danger of being seriously damaged or becoming a total loss and is not removed from such
danger by Borrower forthwith;

 

(w)       Pledgor
does not or shall not have good and merchantable title to all of the shares of the Equity Interest in Borrower, and all Collateral
related thereto, and does not have or shall not hereafter retain good and marketable title thereto, subject to no Encumbrances
except Permitted Encumbrances;

 

(x)       Allseas
does not or shall not have good and merchantable title to the deposit account described in the Allseas Charge on Cash Deposit,
and all Collateral related thereto, and does not have or shall not hereafter retain good and marketable title thereto, subject
to no Encumbrances except Permitted Encumbrances;

 

(y)       without
Lender’s prior written consent, any amounts owed to Phoenix under the COA with respect to the Vessel, or to Charterer under
the Sub-COA with respect to the Vessel, are not promptly paid into the Bulk Discovery Freights Account after Noranda Alumina LLC,
its successor or assigns, makes payments under the COA, except for commissions payable to Mid-Ship Group LLC under Sections 54
of the COA and Sub-COA, and all hire owed by Charterer to Borrower is not fully and timely paid into the Bulk Discovery Hire Account;

 

(z)       the
Mortgage is not permanently registered at the Public Registry of Titles and Encumbrances of Vessels of the Panama Maritime Authority,
such that it creates a duly perfected mortgage and maritime lien under the laws of the Republic of Panama, and creates a preferred
mortgage on the Vessel (as the term “preferred mortgage” is defined at 46 U.S.C. § 31301(6)(B)), or the title
to the property in the Vessel is not permanently registered in the Borrower’s name in such public registry, within thirty
(90) days after the date hereof;

 

(aa)         before
the expiration of Provisional Patente of Navigation/Registration Certificate and Radio Permit for the Vessel, the corresponding
five (5) year validity Patente of Navigation and Radio License is not issued, confirming that all required legal documents and
technical certificates have been submitted to the Merchant Marine Administration (Dirección General de Marina Mercante),
including: Continuous Synopsis Record, Document of Compliance, Safety Management Certificate and International Ship Safety Certificate,
issued under the authority of the Republic of Panama; and

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(bb)        in
a manner which is not otherwise specifically referenced in this Section 7.1, Borrower from time to time breaches or fails to perform
or observe any term, covenant or agreement contained in the Loan Documents, is or becomes in default thereunder, or any further
event of default occurs under any of the Loan Documents.

 

7.2           Remedies.

 

(a)           Upon
the occurrence of:

 

(i)       an
Event of Default constituting a default with respect to a payment of principal, interest, fees, expenses, or any other sum which
is payable to Lender which continues for longer than three (3) days after payment is due;

 

(ii)       an
Event of Default consisting of: (A) a breach of an obligation with respect to obtaining or maintaining required insurance or providing
reasonable and prompt verification thereof, (B) and Event of Default with respect to Sections 5.4(vii), (viii), (ix), , 5.10, 6.3,
6.8, or 7.4, (C) an Event of Default described in Sections 7.1(d), (g), (h), (l), (m), (n), (q), (r), (t), (u), (y), or (z),
(D) an Event of Default which, by its nature, is not capable of being fully remedied so as to provide to Lender the practical benefits
to which it or they are entitled under any of the Loan Documents with respect to such Event of Default; or (E) an Event of Default
which occurs with the knowledge of a Borrower as to which a notice required to be given to Lender is not timely given; or

 

(iii)      any
other Event of Default not specified in subsections (i) or (ii) above which is not fully remedied to the satisfaction of the Lender
within ten (10) days after it occurs,

 

Lender shall enjoy all rights, powers, and remedies which may
arise under the Loan Documents, or otherwise existing or arising by agreement, at law, in equity or in admiralty, including the
following: Lender may deem the principal of the Advance, interest thereon, and all other amounts then owing, accrued or accruing
with respect to the Advance immediately due and payable, and Lender may exercise all such rights, powers and remedies, without
presentments, demands, protests, or notices of any kind, all of which are hereby expressly waived by Borrower, provided,
that in the event of an actual or deemed entry of an order for relief with respect to Borrower under the United States Bankruptcy
Code, as amended, the Obligations automatically shall become and be due and payable, without presentment, demand, protest or any
notice of any kind, all of which are hereby expressly waived by Borrower.

 

(b)          All
rights, powers and authority granted to the Lender in any Loan Document may be exercised on its behalf by any agents or representatives
it appoints from time to time.

 

(c)           On
the occurrence of an Event of Default Lender may, in its discretion, do any act or make any expenditures necessary to remedy such
default or preserve the value of or protect the Collateral, including entering the Vessel to make repairs, purchasing insurance,
discharging Encumbrances, or defending any lawsuit against the Vessel, and Borrower shall promptly reimburse Lender for all such
expenses, with interest at the Interest Rate or Default Rate, as in effect from time to time, for any and all expenditures so made
or incurred, and until Borrower has so reimbursed Lender for such expenditures; but Lender, though privileged so to do, shall be
under no obligation to Borrower to make any such expenditures nor shall the making thereof relieve Borrower of any default in that
respect.

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(d)       The
rights, powers, and remedies provided in the Loan Documents or otherwise existing or arising by agreement, at law, in equity or
in admiralty, or otherwise, are cumulative. All rights, powers, and remedies may be exercised, in whole or in part, from time to
time, as often, and in any order as Lender chooses, and the exercise or the beginning of the exercise of any right, power, or remedy
shall not be construed to be an election of rights, powers, or remedies, or a waiver of the right to exercise at the same time
or thereafter any other right, power, or remedy. No delay or omission by Lender in the exercise of any right, power, or remedy
accruing upon any Event of Default shall impair any such right, power, or remedy or be construed to be a waiver of any right to
take advantage of any such future event or of any such past Default or Event of Default. In case Lender proceeds to enforce any
right, power, or remedy, and such enforcement is discontinued or abandoned for any reason or is determined adversely to Lender,
in whole or in part, then, and in any such case, at the option of Lender, in the exercise of its sole discretion, the relevant
parties shall be restored to their former positions and rights, all rights, powers, and remedies of Lender shall continue as if
no such proceedings had been taken and nothing shall be construed to be a waiver of any right, power, or remedy of Lender. The
acceptance by Lender of any security or any payment of or on account of the Obligations maturing after any Event of Default or
any payment on account of any past default shall not be construed to be a waiver of any right of Lender to take advantage of any
future Event of Default or of any past Event of Default not completely cured thereby. Each Encumbrance that exists or is granted
or otherwise arises pursuant to the Loan Documents is cumulative and not in lieu of any other such Encumbrances.

 

7.3        Legal
Actions. All judicial actions by any party to enforce any provision of any or all of the Loan Documents shall, if requested
by Lender, be brought in or transferred to the United States District Court for the Southern District of New York or the state
courts of general jurisdiction sitting in the County of New York in the State of New York, or in the jurisdiction where relevant
Collateral is located or subject to in rem or quasi in rem proceedings from time to time. Borrower consents to the
jurisdiction of all such courts over it, and hereby irrevocably waives any objection, including any objection to the laying of
venue or based on the grounds of forum non conveniens, which it may now or hereafter have to the bringing of any such action or
proceeding in such respective jurisdictions.

 

BORROWER WAIVES THE RIGHT TO TRIAL BY JURY IN EVERY ACTION,
SUIT, PROCEEDING OR COUNTERCLAIM OF ANY KIND ARISING OUT OF OR RELATED TO THE LOAN DOCUMENTS. BORROWER ACKNOWLEDGES THAT THE FOREGOING
WAIVER IS A MATERIAL INDUCEMENT TO LENDER ENTERING INTO THIS AGREEMENT AND THAT LENDER IS RELYING UPON THE FOREGOING WAIVER IN
ITS DEALINGS WITH BORROWER. BORROWER REPRESENTS AND WARRANTS THAT IT HAS REVIEWED, OR HAS HAD THE OPPORTUNITY TO REVIEW, THE FOREGOING
WAIVER WITH ITS LEGAL COUNSEL AND HAS KNOWINGLY AND VOLUNTARILY WAIVED ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION, OR THE OPPORTUNITY
TO CONSULT, WITH SUCH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL WITHOUT
A JURY BY THE COURT. BORROWER HEREBY CERTIFIES THAT NO REPRESENTATIVE OR AGENT OF LENDER, OR COUNSEL TO LENDER, HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT LENDER WOULD NOT, IN THE EVENT OF SUCH LITIGATION, SEEK TO ENFORCE THIS WAIVER OF RIGHT TO JURY TRIAL
PROVISION.

 

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7.4        Service
of Process. Service of process may be made on Borrower by mailing or delivering a copy of such process to the Borrower in care
of the Process Agent at the Process Agent’s address specified in the Process Agent Appointment, or to any new address of
the Process Agent of which Lender becomes aware. Borrower hereby irrevocably authorizes and directs the Process Agent to accept
such service on its behalf at such addresses. Process Agent is at liberty to change its address to another address in the United
States but Lender is permitted to effect service upon Borrower by service by mail or by service on any person of suitable age and
discretion at the last address for Process Agent known by Lender at the time. Not later than fifteen (15) days before the appointment
of Process Agent is terminated for any reason, Borrower shall appoint a successor that has an address in the United States and
deliver to Lender a written acceptance of appointment of a substitute process agent that contains and agreement in writing to give
Lender not less than thirty (30) days advance written notice of any change of its address or any termination of its appointment
(delivered Lender to Lenders’ address of Lender specified in, or changed as provided in Section 9.4 hereof). As an alternative
method of service, the Borrower also irrevocably consents to the service of any and all process, postage prepaid, in any such action
or proceeding by the mailing a copy of such process to the Borrower at its address identified in or in accordance with Section
9.4. Nothing herein shall affect the right to serve process in any manner permitted by law.

 

7.5        Judgment.
If for the purposes of obtaining judgment in any court it is necessary to convert a sum due hereunder in any currency (the “Original
Currency”) into another currency (the “Other Currency”) the parties hereto agree, to the fullest extent
that they may effectively do so, that the rate of exchange used shall be that at which in accordance with normal banking procedures
the Lender could purchase the Original Currency with the Other Currency in New York City on the second Business Day preceding that
on which final judgment is given. Upon receipt of payment in the Other Currency of the amount of such judgment, the Lender shall
convert such amount into the Original Currency on or as of the next Business Day in accordance with normal banking procedures.
If the amount is so converted at or as of that time is insufficient to discharge the entire amount (including accrued interest),
denominated in the Original Currency, that would be owing at the time to the Lender had no judgment been entered or fixed in the
Other Currency, the Borrower agrees, as a separate obligation and notwithstanding any such judgment, to indemnify Lender against
such loss.

 

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7.6        Right
of Set-Off. Upon the occurrence and during the continuance of any Event of Default, Lender is hereby authorized at any time
and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits and investments (general
or special, time or demand, provisional or final) at any time held in any accounts, and other indebtedness at any time owed by
Lender, to or for the credit or the account of Borrower, against any or all of the obligations of Borrower now or hereafter existing
in favor of Lender, whether or not Lender shall have given any notice or made any demand to Borrower, and although such obligations
of Borrower may be unmatured. Lender agrees to mail or transmit notice to Borrower on the day of each such set-off and application
made by Lender, provided that the failure to give such notice shall not affect the validity of such set-off and application, nor
shall such failure subject Lender to any liability. The rights of Lender under this Section are in addition to other rights, powers,
and remedies (including, without limitation, other rights of set-off) which Lender may have.

 

ARTICLE VIII

CONTINUING GUARANTY

 

8.1        Guaranty.
Each Guarantor hereby unconditionally and irrevocably guarantees, as its separate and independent obligation, as principal obligor,
and not merely as a surety, the punctual payment and performance when due, whether at stated maturity, by acceleration, or otherwise,
of the Obligations. The obligations of the Guarantors and the Borrower are joint and several.

 

8.2        Guaranty
Absolute. Guarantor guarantees that the Obligations shall be paid and performed strictly in accordance with the terms of the
Loan Documents, regardless of any law, regulation or order now or hereafter in effect in any jurisdiction affecting any of such
terms or the rights, powers, or remedies of Lender with respect thereto. This is a guaranty of payment, and not just of collection.
The liability of Guarantor under this Agreement for the Obligations or otherwise shall be absolute and unconditional irrespective
of one or more of: (a) any lack of validity or enforceability of any Loan Document or any provision thereof; (b) any change in
the time, manner or place of payment of, or in any other term of, any or all of the Obligations; (c) any waiver, termination, renewal,
replacement, amendment or other modification of, or any consent to any departure from, any Loan Document or any provision thereof;
(d) any taking, exchange, release or nonperfection of any real or personal property security for any or all of the Obligations;
(e) any taking, waiver, release, amendment or other modification of, or any consent to departure from, any other guaranty
of or liability for any or all of the Obligations; (f) any manner of sale or other disposition of any real or personal property
security for any or all of the Obligations; (g) any manner of application of any real or personal property security, or any proceeds
of any such security, to any or all of the Obligations; (h) any change, restructuring or termination of the structure or existence
of Borrower, any other guarantor or other obligor, or any other Person; or (i) any other circumstance (other than payment and performance
of the Obligations in full) that might otherwise constitute a suretyship or other defense available to Guarantor. The Guarantor
acknowledges that it has received copies of the Loan Documents now in existence, and has reviewed them to its satisfaction.

 

8.3        Waiver.
With the exception of notices to which it is expressly entitled under applicable agreements, Guarantor hereby waives its rights,
if any, to any notices of acceptance and any other notices with respect to any of the Obligations or this Agreement, and waives
all requirements that Lender protect, secure, perfect or insure any real or personal property security for any or all of the Obligations,
or any property subject thereto, or exhaust any right or take any action against Borrower or any other Person, or any security,
or collateral. Lender shall have no obligation to marshal any present or future collateral security for any of the Obligations
or to resort to any such collateral security in any order.

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8.4        Subrogation.
The Guarantor shall not exercise any rights which it may acquire by way of subrogation under this Agreement, by any payment made
hereunder or otherwise, until all the Obligations shall have been paid and performed in full. If any amount shall be paid to the
Guarantor on account of such subrogation rights at any time when all the Obligations shall not have been paid and performed in
full, such amount shall be held in trust for the benefit of Lender and shall forthwith be paid to Lender to be credited and applied
to the Obligations, whether matured or unmatured, in accordance with Section 2.3.

 

8.5        Holding
Company Indemnification. Holding Company shall indemnify and hold harmless Charterer from and against any and all liabilities
claims, actions, suits, judgments, costs, disbursements and expenses (including reasonable fees and expenses of legal counsel related
thereto) of any kind or nature whatsoever which may at any time be imposed on, incurred by or asserted against Charterer as a result
of Charterer’s obligations under this Article.

 

8.6        Subordination.

 

(a)       Neither
Guarantor shall make any loans or advances to Borrower, and Holding Company shall ensure that no Subsidiaries thereof shall make
any loans or advances to Borrower, in each case other than equity investments of capital. All Indebtedness of Borrower to each
Guarantor whether now existing or hereafter arising (the “Subordinated Debt”) is hereby subordinated to full
payment and performance of the Obligations, and until then, Borrower shall not make, and neither Guarantor shall, without the prior
written consent from Lender (granted or withheld in the exercise of its sole discretion) accept any payment of an Indebtedness
from Borrower. All Encumbrances that either Guarantor may have or that would otherwise arise against any assets of Borrower, including
for any breach of the Time Charter, are hereby irrevocably subordinated to the lien of the Mortgage and other security granted
in the Loan Documents (the “Subordinated Liens”).

 

(b)       Unless
otherwise permitted pursuant to this Agreement, all payments or distributions upon or with respect to the Subordinated Debt or
obligations secured by Subordinated Liens, including from Bankruptcy or Other Proceedings pertaining to any of them, whether through
payment, subrogation, or otherwise, shall be received in trust for the benefit of Lender, shall be segregated from other funds
and assets held by the recipient, and shall be forthwith paid to the Lender in the same form in which it was received (with any
necessary endorsement) to be applied (in the case of cash) to the Obligations in accordance with Section 2.3, or received as collateral
(in the case of non-cash property or securities) as security for, the payment of the Obligations, to be foreclosed upon in the
occurrence of an Event of Default as permitted by law.

 

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(c)       If
any Bankruptcy or Other Proceeding is commenced by or against or otherwise occurs with respect to Borrower, any member or shareholder
of Borrower, any Person of which Borrower is a partner, joint venturer, or member, or any Subsidiary of Borrower, this Agreement
shall remain in effect, and Lender is hereby irrevocably authorized (in its own name or in the name of Holding Company or Charterer,
as the case may be), but shall have no obligation, to demand, sue for, collect, and receive every payment or distribution that
results from a Bankruptcy or Other Proceeding on account of the Subordinated Debt or obligations secured by Subordinated Liens,
and to give acquittance therefor, file claims and proofs of claim, and take such other action with respect thereto (including voting
the Subordinated Debt or obligations secured by Subordinated Liens, enforcing security therefor, and compromising claims therefor)
as it may deem necessary or advisable for the exercise or enforcement of any of the rights, powers, and remedies of the Lender
hereunder.

 

(d)       For
so long as any of the Obligations remain outstanding the Guarantors shall duly and promptly take or refrain from taking such action
as the Lender may reasonably require: (i) unless otherwise permitted pursuant to this Agreement, to collect the Subordinated Debt
and obligations secured by Subordinated Liens and remit the proceeds thereof to Lender, file appropriate claims and proofs of claim
in respect of the Subordinated Debt or obligations secured by Subordinated Liens, (ii) to execute and deliver to the Lender such
powers of attorney, assignments, and other instruments as the Lender may require in order to enable the Lender to enforce any or
all claims with respect to, and security for, the Subordinated Debt and obligations secured by Subordinated Liens, and (iii) to
collect and receive all payments and distributions that may be payable or deliverable upon or with respect to the Subordinated
Debt and obligations secured by Subordinated Liens.

 

(e)       For
so long as any of the Advance remains outstanding Guarantors shall not, without the prior written consent of Lender: (i) accelerate
or demand payment of any of the Subordinated Debt or obligations secured by Subordinated Liens; (ii) commence any legal proceedings
or arbitration proceedings to collect any of the Subordinated Debt or obligations secured by Subordinated Liens, (iii) exercise
any rights, powers, or remedies with respect to collection of the Subordinated Debt or obligations secured by Subordinated Liens;
(iv) cooperate with or stipulate to the commencement or continuation of any Bankruptcy or Other Proceeding with respect to Borrower
or any of its assets, (v) assist the Borrower with respect to any Bankruptcy or Other Proceedings pertaining to the Borrower, or
(vi) assign, transfer, or subject to an Encumbrance any Subordinated Debt or obligations secured by Subordinated Liens.

 

(f)       Borrower
shall not make any payment of any of the Subordinated Debt or obligations secured by Subordinated Liens without the written consent
of Lender previously obtained, which may be granted or withheld by Lender in the exercise of its sole discretion. None of the Subordinated
Debt or obligations secured by Subordinated Liens (or any agreements, instruments, or other evidence thereof) shall be amended
in a manner that would have an adverse effect on the rights, powers, or remedies of Lender under this Agreement. Borrower and Guarantors
agree to refrain from all acts which are in any way inconsistent with this Agreement or the rights of Lender hereunder. Borrower
and Guarantors agree to perform all further acts reasonably necessary to give full effect to this Agreement.

 

(g)       Guarantors
waive the right to assert the doctrine of marshalling of assets against the Lender.

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ARTICLE IX

MISCELLANEOUS

 

9.1        Loan
Documents, Administration and Collection Expenses. Borrower shall pay or reimburse Lender for the preparation, negotiation
and execution of the Loan Documents, and all waivers under and amendments thereto from time to time, and the reasonable fees and
expenses of counsel for Lender in connection therewith, whether Borrower satisfies the conditions precedent contained in Article
III or not. Borrower shall pay or reimburse Lender for all costs and other expenses incurred in connection with the drafting, negotiation,
execution, delivery, filing, or recording of the Loan Documents, or the enforcement, attempted enforcement, or preservation of
any rights, powers, or remedies under the Loan Documents (including all such costs and expenses incurred during any “workout”
or restructuring in respect of the Obligations and during legal proceedings, including Bankruptcy or Other Proceedings), and including
all the reasonable fees and expenses of legal counsel. The foregoing costs and expenses shall include all search, filing, recording,
title insurance and appraisal charges and fees and stamp and other taxes related thereto, and other out-of-pocket expenses incurred
by Lender, and the cost of independent public accountants and other outside experts retained by Lender.

 

9.2        Indemnification.
Whether or not the transactions contemplated herein are consummated, Borrower shall indemnify and hold harmless Lender and its
Affiliates, directors, officers, employees, counsel, agents and attorneys-in-fact (collectively, the “Indemnitee”)
from and against any and all liabilities, obligations, losses, damages, penalties, claims, demands, actions, judgments, suits,
costs, disbursements and expenses (including reasonable fees and expenses of legal counsel related thereto) of any kind or nature
whatsoever which may at any time be imposed on, incurred by or asserted against any such Indemnitee in any way relating to or arising
out of or in connection with (a) the drafting, negotiation, execution, delivery, filing, recording, enforcement, performance or
administration of any Loan Document or any other document delivered in connection with the transactions contemplated thereby, or
the consummation of the transactions contemplated thereby, (b) the Advance or the use or proposed use of the proceeds thereof,
(c) the ownership and operation of the business and assets of Borrower, including if any assertion is made that Borrower, any Indemnitee,
or any other Persons were negligent with respect thereto, (d) any actual or alleged presence or release of Hazardous Materials
on or from any personal or real property currently or formerly owned or operated by Borrower or for its account, or any Environmental
Liability related in any way to Borrower or any of the Collateral, or (e) any actual or prospective claim, litigation, investigation
or proceeding relating to any of the foregoing, whether based on contract, tort, strict liability, or any other theory (including
any investigation of, preparation for, or defense of any pending or threatened claim, litigation, investigation, or proceeding)
and regardless of whether any Indemnitee is a party thereto, in all cases, whether or not caused by or arising, in whole or in
part, out of the negligence of the Indemnitee; provided that such indemnity shall not, as to any Indemnitee, be available to the
extent that such liabilities, obligations, losses, damages, penalties, claims, demands, actions, judgments, suits, costs, disbursements
and expenses are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted primarily
from the fraud, gross negligence or willful misconduct of an Indemnitee. The agreements in this Section shall survive the performance
of all the Obligations and termination of this Agreement.

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9.3        Amendments
and Waivers. No amendment, modification, termination, or waiver of any provision of any of the Loan Documents, nor consent
to any departure therefrom, shall be effective unless the same shall be in writing and signed by Lender. Waivers or consents shall
be effective only in the specific instances and for the specific purposes for which they are given. The Loan Documents shall not
be deemed amended, qualified, or supplemented by any course of dealing. No notice to or demand on any Person in any instance shall
entitle any Person to any other or further notice or demand in similar or other circumstances.

 

9.4        Notices.
All notices, requests, demands, directions and other communications between parties hereto shall be in writing and delivered by
hand, sent by overnight courier, or by facsimile, or mailed by certified mail, return receipt requested (postage prepaid), to the
applicable party at the addresses indicated below:

 

If to a Credit Party (and Allseas and Phoenix):

 

	 	c/o Phoenix Bulk Carriers (US) LLC
	 	(as agent)
	 	88 Valley Road
	 	Middletown, RI 02842
	 	United States
	 	Attn: Mr. Anthony Laura
	 	Facsimile No.: (401) 846-1520
	 	 
	If to Lender:	GATX Corporation
	 	 
	 	Four Embarcadero Center, Suite 2100
	 	San Francisco, CA 94111
	 	Attn:  Contracts Administration
	 	Facsimile No.:  415-955-3416

 

or, as to each party, at such other address as shall be designated
by such party on written notice to the other party otherwise complying as to form and delivery with terms of this paragraph. All
such notices, requests, demands, directions and other communications shall be effective on actual delivery, or, when mailed, shall
be effective on the third calendar day after being deposited in the U.S. mail, or, when sent by overnight courier, on the next
business day after being delivered to such overnight courier, or when transmitted by fax, shall be effective on transmission with
confirmed receipt of transmission, respectively.

 

9.5        Governing
Law. The validity, performance, construction, interpretation, and effect of this Agreement shall be governed by and construed
in accordance with the internal laws of the State of New York (excluding its laws relating to conflicts of law except for Sections
5-1401 and 5-1402 of the General Obligation Laws of New York), except as the same may be governed by the federal law of the United
States.

    	46

    	 

    

 

9.6        Severability.
If any provision of this Agreement, or the application to any circumstance, person or place, is held to be unenforceable, invalid
or void by a court or other tribunal of competent jurisdiction, such provision shall be severed therefrom or shall be reformed
only to the extent necessary to be enforceable to such circumstance, person or place; and such provision as applied to other circumstances,
persons or places, and the remainder of this Agreement, shall remain in full force and effect.

 

9.7        Assignment.
No assignment, delegation or other transfer of this Agreement, in whole or in part, directly or indirectly, whether voluntarily,
involuntarily or by operation of law, or of any rights and obligations under this Agreement can be made by any party other than
Lender, without the prior written consent of the other party, which consent can be withheld in the exercise of its sole discretion.
Any purported assignment, transfer, or delegation in violation of this Section shall be void. Subject to the limits on assignment,
this Agreement shall be binding upon and inure to the benefit of the parties and their respective permitted successors and assigns.
This Agreement does not create and shall not be construed as creating any rights enforceable by any person not a party to this
Agreement. To the extent permitted by law, Lender may freely assign any or all of the Loan Documents, or assign or delegate any
or all of its rights and obligations arising under the Loan Documents to other parties or financial institutions, and may permit
other parties or financial institutions to participate in the Obligations and transactions evidenced by the Loan Documents, in
which event reference to Lender in such documents shall refer to Lender’s successors, delegees, or assigns, and to such participants,
as appropriate. In that connection, Lender may disclose all documents and information which Lender now or hereafter may have relating
to the Loan Documents, the transactions evidenced thereby, Borrower, or its business.

 

9.8        Further
Assurances. Each party hereto agrees to perform such further acts and to execute and deliver such additional written instruments
as may from time to time be reasonably required to provide, maintain and perfect the security contemplated in this Agreement, and
otherwise to carry out the intent, terms and conditions of this Agreement.

 

9.9        Authority.
None of the obligations of any of the parties to this Agreement or to any of the other Loan Documents shall be affected in the
event that the execution and delivery of any or all of the Loan Documents on behalf of any other party was not duly authorized
by all necessary corporate or company action.

 

9.10         Complete
Agreement. This Agreement, including all exhibits, schedules, and all additional documents herein or therein incorporated by
reference, expresses the complete understanding and agreement of the parties hereto with respect to its subject matter, all prior
oral and written agreements to the contrary notwithstanding, and all contemporaneous oral agreements notwithstanding.

 

9.11         Counterparts.
This Agreement may be executed in counterparts, all of which, taken together, shall constitute the entire Agreement. For purposes
of this Agreement, a facsimile or other electronic version of a party’s signature, such as a .pdf, printed by a receiving
facsimile or printer shall be deemed an original signature.

 

[Signatures
provided on next page]

    	47

    	 

    

 

 

IN WITNESS WHEREOF, the parties hereto have
caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written.

 

	 	GATX CORPORATION
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 
	 	 	 
	 	BULK DISCOVERY (BERMUDA) LTD.
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 
	 	 	 
	 	BULK PARTNERS (BERMUDA) LTD.
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 
	 	 	 
	 	AMERICAS BULK TRANSPORT (BVI) LIMITED
	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 

 

Signature Page to Loan and Guaranty Agreement

 

    	 

    	 

    

 

SCHEDULES

 

	2.4	Approved Appraisers
	4.6	Shareholders
	4.8	Litigation
	4.9	Permitted Encumbrances
	4.11	Locations

 

EXHIBITS

 

	A	Request for Advance
	B	Mortgage
	C	Borrower’s Earnings Assignment Agreement
	D	Charterer’s Earnings Assignment Agreement
	E	Manager’s Undertaking – Seamar Management S. A.
	F	Manager’s Undertaking – Phoenix
	G	Funds Deposit Agreement
	H	Shares Charge
	I	Charge Over Cash Deposit
	J	Compliance Certificate
	K	Notice of Assignment
	L	Insurance Endorsements
	M	Broker’s Opinion Letter

 

    	 

    	 

    

 

SCHEDULE 2.4

 

APPROVED APPRAISERS

 

Fearnleys AS

H. Clarkson & Co. Limited

Platou Shipbrokers

 

    	 

    	 

    

 

 

SCHEDULE 4.6

 

EQUITY INTERESTS IN HOLDING COMPANY

Bulk Partners (Bermuda) Ltd.

 

	Shareholder	 	Number of Shares	 	Percentage	 	Citizenship
	 	 	 	 	 	 	 
	Ed Coll	 	38,643(Common)	 	44.25%	 	United States
	 	 	 	 	 	 	 
	Lagoa Investments Ltd.	 	34,277 (Common)	 	39.25%	 	Bermuda
	 	 	 	 	 	 	 
	Anthony Laura	 	14,409 (Common)	 	16.50%	 	United States
	 	 	 	 	 	 	 
	Pangaea One L.P.	 	7,759.946 (Preferred)	 	 	 	United States
	 	 	 	 	 	 	 
	Pangaea One (Cayman) L.P.	 	4,276.712 (Preferred)	 	 	 	Cayman Islands
	 	 	 	 	 	 	 
	Pangaea One Parallel Fund L.P.	 	3,996.424 (Preferred)	 	 	 	Cayman Islands
	 	 	 	 	 	 	 
	Pangaea One Parallel Fund (B) L.P.	 	2,107.317 (Preferred)	 	 	 	United States

 

EQUITY INTERESTS IN PLEDGOR

Bulk Fleet Bermuda Holding Company Limited

 

	Shareholder	 	Number of

                           Shares
	 	Percentage	 	Citizenship
	 	 	 	 	 	 	 
	Bulk Partners (Bermuda) Ltd.	 	10,000	 	100%	 	Bermuda
	 	 	 	 	 	 	 

EQUITY INTERESTS IN BORROWER

Bulk Discovery (Bermuda) Ltd.

 

	Shareholder	 	Number of 

                           Shares
	 	Percentage	 	Citizenship
	 	 	 	 	 	 	 
	Bulk Fleet Bermuda Holding Company Limited	 	10,000	 	100%	 	Bermuda

 

    	 

    	 

    

 

 

EQUITY INTERESTS IN CHARTERER

Americas Bulk Transport (BVI) Limited

 

	Shareholder	 	Number of

                           Shares
	 	Percentage	 	Citizenship
	 	 	 	 	 	 	 
	Bulk Partners Holding Company Bermuda Ltd.	 	1,000	 	100%	 	Bermuda

  

BORROWER’S SUBSIDIARIES

(Direct and Indirect)

 

None

 

SUBSCRIPTION AGREEMENTS, ETC. FOR EQUITY

INTERESTS IN BORROWER

 

None

 

    	 

    	 

    

 

SCHEDULE 4.8

 

LEGAL ACTIONS

 

NONE

 

    	 

    	 

    

 

SCHEDULE 4.9

 

PERMITTED ENCUMBRANCES

 

Charters and Service Agreements

 

The Time Charter

The Sub-COA

The COA

 

Other Encumbrances

 

Maritime liens on the Vessel for:

 

(a) torts that are covered by insurance
that complies with the provisions of the Preferred Mortgages; or

 

(b) crew’s wages, salvage, or for
goods and services furnished to the Vessel in the ordinary course of Borrower’s business and not in violation of any provisions
of the Loan Documents, none of which are overdue provided, Borrower may contest such Encumbrances in good faith if appropriate
reserves therefor are established and maintained consistently with GAAP, and security therefor is posted as necessary to prevent
the Seizure of the Vessel, or, if the Vessel is Seized with respect to a claim of such an Encumbrance, the Vessel is released therefrom
within thirty (30) days.

 

    	 

    	 

    

 

SCHEDULE 4.11

 

LOCATIONS

 

	Entity	 	Chief Executive Office	 	Place of Business or Business Records
	 	 	 	 	 
	Borrower	 	3rd Floor – Par la Ville Place	 	c/o Phoenix Bulk Carriers (US) LLC
	 	 	14 Par la Ville Road	 	88 Valley Road
	 	 	Hamilton HM08	 	Middletown, RI 02842
	 	 	Bermuda	 	 
	 	 	 	 	 
	Pledgor	 	3rd Floor – Par la Ville Place	 	c/o Phoenix Bulk Carriers (US) LLC
	 	 	14 Par la Ville Road	 	88 Valley Road
	 	 	Hamilton HM08	 	Middletown, RI 02842
	 	 	Bermuda	 	 
	 	 	 	 	 
	Charterer	 	3rd Floor – Par la Ville Place	 	c/o Phoenix Bulk Carriers (US) LLC
	 	 	14 Par la Ville Road	 	88 Valley Road
	 	 	Hamilton HM08	 	Middletown, RI 02842
	 	 	Bermuda	 	 
	 	 	 	 	 
	Allseas	 	3rd Floor – Par la Ville Place	 	c/o Phoenix Bulk Carriers (US) LLC
	 	 	14 Par la Ville Road	 	88 Valley Road
	 	 	Hamilton HM08	 	Middletown, RI 02842
	 	 	Bermuda	 	 

 

All of the above companies have no place of business or business
records at any location in the United States, with the possible exception of:

 

c/o Phoenix Bulk Carriers (US) LLC

88 Valley Road

Middletown, RI 02842

 

    	 

    	 

    

 

EXHIBIT A

 

REQUEST FOR ADVANCE

 

Pursuant to Section 2.1 of the Loan and Guaranty Agreement dated
February __, 2011 (as assigned, assumed, amended, renewed, replaced, or otherwise modified (the “Loan Agreement”)
among GATX Corporation (“Lender”) and Bulk Discovery (Bermuda) Ltd. (“Borrower”), Bulk Partners
(Bermuda) Ltd., and Americas Bulk Transport (BVI) Limited please disburse the Advance on a Business Day on or about _______, 2011
as follows:

 

1.       The
amount of $_____________ by wire transfer as follows:

 

	 	_________________________
	 	Branch: _____________
	 	Account No.: _________________
	 	ABA Routing No.: ________________

 

2.       ____________________________________

 

None of Borrower’s representations or warranties contained
in any of the Loan Documents are untrue, Borrower is in compliance with all of its covenants contained in the Loan Documents, and
no Default or Event of Default has occurred and is continuing under the Loan Documents.

 

Terms used herein that are defined in the Loan Agreement have
the meaning herein that they are given therein.

 

DATE: _____________, 2011

 

	 	BULK DISCOVERY (BERMUDA) LTD.
	 	 	 
	 	By:	 
	 	Its:

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