Document:

DATED
          1st June         
      2006

    

    

    

    

    GULF
      OFFSHORE N.S. LIMITED

    (as
      borrower)

    

    -
      and -

    

    DnB
      NOR Bank ASA

    and
      others

    (as
      banks)

    

    -
      and -

    

    

    DnB
      NOR Bank ASA

    (as
      mandated lead arranger)

    

    -
      and -

    

    DnB
      NOR Bank ASA

    (as
      agent and security trustee)

    

    

    

    _________________________________________

    

    US$60,000,000
      SECURED

    REDUCING
      REVOLVING LOAN

    FACILITY
      AGREEMENT

    _________________________________________

    

    

    

    

    

    

    

    

    STEPHENSON
      HARWOOD

    One,
      St. Paul's Churchyard

    London
      EC4M 8SH

    Tel:
      020 7329 4422

    Fax:
      020 7329 7100

    Ref:
      1313

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    CONTENTS

    
 

    
      	
              1

            	
              Definitions
                and Interpretation

            	
              1

            
	
              2

            	
              The
                Facility and its Purpose

            	
              21

            
	
              3

            	
              Conditions Precedent and Subsequent

            	
              27

            
	
              4

            	
              Representations
                and Warranties

            	
              30

            
	
              5

            	
              Repayment,
                Prepayment and Currency Option

            	
              34

            
	
              6

            	
              Interest

            	
              38

            
	
              7

            	
              Fees

            	
              40

            
	
              8

            	
              Security
                Documents

            	
              40

            
	
              9

            	
              Agency
                and Trust

            	
              40

            
	
              10

            	
              Covenants

            	
              50

            
	
              11

            	
              Earnings

            	
              56

            
	
              12

            	
              Events Of Default

            	
              57

            
	
              13

            	
              Set-Off
                and Lien

            	
              61

            
	
              14

            	
              Assignment and
                Sub-Participation

            	
              62

            
	
              15

            	
              Payments,
                Mandatory Prepayment, Reserve Requirements and Illegality

            	
              64

            
	
              16

            	
              Communications

            	
              69

            
	
              17

            	
              General
                Indemnities

            	
              70

            
	
              18

            	
              Miscellaneous

            	
              72

            
	
              19

            	
              Law and Jurisdiction

            	
              76

            
	 	
              SCHEDULE
                1

            	
              78

            
	 	
              The
                Banks, the Commitments and the Proportionate Shares

            	
              78

            
	 	
              SCHEDULE
                2

            	
              79

            
	 	
              The
                Vessels

            	
              79

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

      
        	
                SCHEDULE
                  3

              	
                80

              
	
                Form
                  of Transfer Certificate

              	
                80

              
	
                SCHEDULE
                  4

              	
                83

              
	
                Form
                  of Drawdown Notice

              	
                83

              
	
                SCHEDULE
                  5

              	
                85

              
	
                Calculation
                  of the Mandatory Cost

              	
                85

              
	
                SCHEDULE
                  6

              	
                88

              
	
                Form
                  of Compliance Certificate

              	
                88

              

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    LOAN
      FACILITY AGREEMENT

     

    Dated:
        1st
      June 2006

     

    BETWEEN:-

     

    
      	
              (1)

            	
              GULF
                OFFSHORE N.S. LIMITED,
                a
                company incorporated according to the law of England and Wales whose
                principal place of business is at 10 Charlotte Road, Barnes, London
                SW13
                9QJ, England (the "Borrower");
                and 

            

    

     

    
      	
              (2)

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

            

    

     

    
      	
              (3)

            	
              DnB
                NOR Bank ASA acting
                as mandated lead arranger (in that capacity the "MLA");
                and

            

    

     

    
      	
              (4)

            	
              DnB
                NOR Bank ASA
                acting as agent and security trustee through its office at Lars Hillesgate
                30, PO Box 7100, NO-5020 Bergen, Norway (in that capacity the
                "Agent").

            

    

     

    WHEREAS:-

     

    Each
      of
      the Banks has agreed to
      advance
      to the Borrower its respective Commitment of an aggregate principal amount
      not
      exceeding sixty million Dollars ($60,000,000) for the general corporate purposes
      of the Borrower.

     

    IT IS AGREED
      as
      follows:-

     

    
      	1  	
              Definitions
                and Interpretation

            

    

     

    1.1 Definitions

     

    In
      this
      Agreement:-

     

    
      	 	
              1.1.1

            	
              "Accounts"
                means the consolidated financial accounts of the Guarantor to be
                provided
                to the Agent pursuant hereto.

            

    

     

    
      	 	
              1.1.2

            	
              "Address
                for Service"
                means 10 Charlotte Road, Barnes, London, SW13 9QJ, England or, in
                relation
                to any of the Security Parties, such other address in England and
                Wales as
                that Security Party may from 

            

    

     

    

    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    time
      to
      time designate by no fewer than ten (10) Business Days' written notice to the
      Agent.

     

    
      	 	
              1.1.3

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

            

    

     

    
      	 	
              1.1.4

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

            

    

     

    
      	 	
              1.1.5

            	
              "Agent's
                Spot Rate of Exchange"
                means the Agent's spot rate of exchange for the purchase of the relevant
                currency with the Base Currency in the London foreign exchange market
                at
                or about 11.00 a.m. on a particular
                day.

            

    

     

    
      	 	
              1.1.6

            	
              "Approved
                Brokers"
                means H. Clarkson & Co. Ltd, Simpson Spence & Young Shipbrokers
                Ltd, Fearnley AS, R. S. Platou AS and Seabrokers
                Group.

            

    

     

    
      	 	
              1.1.7

            	
              "Assignments"
                means the first priority assignments of the Insurances and Requisition
                Compensation of the Vessels to be made between the Borrower and the
                Agent
                referred to in Clause 8.1.2 (each an "Assignment").

            

    

     

    1.1.8 "Base
      Currency"
      means
      Dollars.

     

    
      	 	
              1.1.9

            	
              "Base
                Currency Amount"
                means the amount specified in the Drawdown Request or, if the amount
                requested is not denominated in the Base Currency, that amount converted
                into the Base Currency at the Agent's Spot Rate of Exchange on the
                date
                which is three (3) Business Days before the Advance Date adjusted
                to
                reflect any repayment (other than a repayment arising from a change
                of
                currency) or prepayment.

            

    

     

    
      	 	
              1.1.10

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

            

    

     

    

    
      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              1.1.11

            	
              "Borrower's
                Security Documents"
                means those of the Security Documents to which the Borrower is or
                is to be
                a party.

            

    

     

    
      	 	
              1.1.12

            	
              "Break
                Costs"
                means all documented costs, losses, premiums or penalties incurred
                by any
                of the Finance Parties in the circumstances contemplated by Clause
                17.4 or
                as a result of any of them receiving any prepayment of all or any
                part of
                the Facility (whether pursuant to Clauses 5.2 and 5.3 or otherwise)
                or any
                other payment under or in relation to the Security Documents on a
                day
                other than the due date for payment of the sum in question, and includes
                (without limitation) any losses or costs incurred in liquidating
                or
                re-employing deposits from third parties acquired to effect or maintain
                the Facility, and any liabilities, expenses or losses incurred by
                any of
                the Finance Parties in terminating or reversing, or otherwise in
                connection with, any interest rate and/or currency swap, transaction
                or
                arrangement entered into by any of the Finance Parties with any member
                of
                the Group to hedge any exposure arising under this Agreement, or
                in
                terminating or reversing, or otherwise in connection with, any open
                position arising under this
                Agreement.

            

    

     

    
      	 	
              1.1.13

            	
              "Business
                Day"
                means a day (other than a Saturday or Sunday) on which banks are
                open for
                general business in London, New York City and Bergen and which is
                a TARGET
                Day.

            

    

     

    
      	 	
              1.1.14

            	
              "Commitment"
                means, in relation to each Bank, the amount of the Facility which
                that
                Bank agrees to advance to the Borrower as its several liability as
                indicated against the name of that Bank in Schedule 1, as reduced
                from time to time in accordance with Clause 2.4, or, where the context
                permits, the amount of the Facility advanced by that Bank and remaining
                outstanding.

            

    

     

    
      	 	
              1.1.15

            	
              "Commitment
                Commission"
                means the commitment commission to be paid by the Borrower to the
                Agent on
                behalf of the Banks pursuant to Clause
                7.

            

    

     

    
      	 	
              1.1.16

            	
              "Commitment
                Termination Date"
                means the date falling one month prior to the Termination
                Date.

            

    

     

    

    
      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              1.1.17

            	
              "Communication"
                means any notice, approval, demand, request or other communication
                from
                one party to this Agreement to any other party to this
                Agreement.

            

    

     

    
      	 	
              1.1.18

            	
              "Communications
                Address"
                means 10111 Richmond Avenue, Suite 340, Houston, Texas, 77042, the
                United
                States of America (fax no: +1 713 963 0541 marked for the attention
                of Mr
                E. Guthrie, email:
                ed.guthrie@gulfmark.com).

            

    

     

    
      	 	
              1.1.19

            	
              "Company"
                means at any given time the company responsible for a Vessel's compliance
                with (i) the ISM Code under paragraph 1.1.2 of the ISM Code and/or
                (ii)
                the ISPS Code (as the case may be).

            

    

     

    
      	 	
              1.1.20

            	
              "Compliance
                Certificate"
                means a certificate to be delivered by the Borrower to the Agent
                substantially in the form of Schedule
                6.

            

    

     

    
      	 	
              1.1.21

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

            

    

     

    
      	 	
              1.1.22

            	
              "Default
                Rate"
                means the rate which is the aggregate of LIBOR, any Mandatory Cost,
                the
                Margin and two per centum (2%) per
                annum.

            

    

     

    
      	 	
              1.1.23

            	
              "Determination
                Date"
                means

            

    

     

    (a) the
      last
      day of each calendar quarter during the Facility Period;

     

    (b) after
      the
      occurrence of an Event of Default which is continuing, any date designated
      by
      the Agent upon at least three (3) Business Days' prior written notice to the
      Borrower; and

     

    (c) each
      Advance Date.

     

    
      	 	
              1.1.24

            	
              "DOC"
                means in relation to the ISM Company, a valid Document of Compliance
                issued for the ISM Company by the Administration under paragraph
                13.2 of
                the ISM Code.

            

    

     

    

    
      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              1.1.25

            	
              "Dollars"
                "US$"
                and "$"
                each means available and freely transferable and convertible funds
                in
                lawful currency of the United States of
                America.

            

    

     

    
      	 	
              1.1.26

            	
              "Drawdown
                Notice"
                means a notice complying with Clause 2.3 in the form set out in Schedule
                4.

            

    

     

    
      	 	
              1.1.27

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

            

    

     

    
      	 	
              1.1.28

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

            

    

     

    
      	 	
              1.1.29

            	
              "Earnings
                Account"
                means a bank account to be opened in the name of the Borrower with
                the
                Agent and designated "Vessel Net Earnings Account".
                

            

    

     

    
      	 	
              1.1.30

            	
              "EBITDA"
                means, for any twelve month period ending on a Determination Date,
                the
                consolidated profit on ordinary activities of the Group before
                Taxes:

            

    

     

    (a) adjusted
      to exclude interest received or receivable and other similar income to the
      extent not already excluded;

     

    (b) before
      the depreciation of fixed assets but after excluding any loss or gain arising
      on
      the disposal of fixed assets or shares;

     

    (c) before
      the deduction of Interest Expense for such period;

     

    

    
      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

    

    

    (d) before
      any charge for the amortisation of goodwill, merger differences, acquisition
      costs or any other intangible asset; and

     

    (e) before
      adding or deducting extraordinary or exceptional items (to include, for the
      avoidance of doubt, any redundancy costs and foreign exchange profits and losses
      in relation to the funding of the business) in each case for such
      period.

     

    
      	 	
              1.1.31

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

            

    

     

    
      	 	
              1.1.32

            	
              "Environmental
                Affiliate"
                means an agent or employee of the Borrower or a person in a contractual
                relationship with the Borrower in respect of the Vessel owned by
                it
                (including without limitation, the operation of or the carriage of
                cargo
                of such Vessel).

            

    

     

    
      	 	
              1.1.33

            	
              "Environmental
                Approvals"
                means any present or future permit, licence, approval, ruling, variance,
                exemption or other authorisation required under the applicable
                Environmental Laws.

            

    

     

    
      	 	
              1.1.34

            	
              "Environmental
                Claim"
                means any and all enforcement, clean-up, removal, administrative,
                governmental, regulatory or judicial actions, orders, demands or
                investigations instituted or completed pursuant to any Environmental
                Laws
                or Environmental Approvals together with any claims made by any third
                person relating to damage, contribution, loss or injury resulting
                from any
                Environmental Incident.

            

    

     

    
      	 	
              1.1.35

            	
              "Environmental
                Incident"
                means:

            

    

     

    
      	 	
              (a)

            	
              any
                release of Environmentally Sensitive Material from a Vessel;
                or

            

    

     

    
      	 	
              (b)

            	
              any
                incident in which Environmentally Sensitive Material is released
                from a
                vessel other than a Vessel and which involves a collision between
                a Vessel
                and such other vessel or some other incident of navigation or operation,
                in either case, in connection 

            

    

     

    

    
      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

    

    

    with
      which the relevant Vessel is actually or potentially liable to be arrested,
      attached, detained or injuncted and/or where any guarantor, any manager (or
      any
      sub-manager of such Vessel) or any of its officers, employees or other persons
      retained or instructed by it (or such sub-manager) are at fault or allegedly
      at
      fault or otherwise liable to any legal or administrative action; or

     

    
      	 	
              (c)

            	
              any
                other incident in which Environmentally Sensitive Material is released
                otherwise than from such Vessel and in connection with which that
                Vessel
                is actually or potentially liable to be arrested and/or where any
                guarantor, any manager (or any sub-manager of the relevant Vessel)
                or any
                of its officers, employees or other persons retained or instructed
                by it
                (or such sub-manager) are at fault or allegedly at fault or otherwise
                liable to any legal or administrative
                action.

            

    

     

    
      	 	
              1.1.36

            	
              "Environmental
                Laws"
                means all present and future laws, regulations, treaties and conventions
                of any applicable jurisdiction
                which:

            

    

     

    
      	 	
              (a)

            	
              have
                as a purpose or effect the protection of, and/or prevention of harm
                or
                damage to, the environment;

            

    

     

    
      	 	
              (b)

            	
              relate
                to the carriage of Environmentally Sensitive Material or to actual
                or
                threatened releases of Environmentally Sensitive
                Material;

            

    

     

    
      	 	
              (c)

            	
              provide
                remedies or compensation for harm or damage to the environment;
                or

            

    

     

    
      	 	
              (d)

            	
              relate
                to Environmentally Sensitive Materials or health or safety
                matters.

            

    

     

    
      	 	
              1.1.37

            	
              "Environmentally
                Sensitive Material"
                means (i) oil and oil products and (ii) any other waste, pollutant,
                contaminant or other substance (including any liquid, solid, gas,
                ion,
                living organism or noise) that may be harmful to human health or
                other
                life or the environment or a nuisance to any person or that may make
                the
                enjoyment, ownership or 

            

    

     

    

    
      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

    

    

    other
      territorial control of any affected land, property or waters more costly for
      such person to a material degree.

     

    1.1.38 "EURIBOR"
      means:

     

    (a) the
      applicable Screen Rate; or

     

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

     

    
      	 	 	
              at
                11.00 a.m. (Brussels time) on the Quotation Day for the offering
                of
                deposits in euro in an amount comparable to the Loan (or any relevant
                part
                of the Loan) and for a period comparable to the relevant Interest
                Period.

            

    

     

    
      	 	
              1.1.39

            	
              "euro"
                and "€"
                means the single currency of the Participating Member
                States.

            

    

     

    
      	 	
              1.1.40

            	
              "Event
                of Default"
                means any of the events set out in
                Clause 12.2.

            

    

     

    
      	 	
              1.1.41

            	
              "Execution
                Date"
                means the date on which this Agreement is executed by each of the
                parties
                hereto.

            

    

     

    
      	 	
              1.1.42

            	
              "Facility"
                means the reducing revolving credit facility made available by the
                Banks
                to the Borrower pursuant to this
                Agreement.

            

    

     

    
      	 	
              1.1.43

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

            

    

     

    
      	 	
              1.1.44

            	
              "Facility
                Period"
                means the period beginning on the Execution Date and ending on the
                date
                when the whole of the Indebtedness has been repaid in full and the
                Borrower has ceased to be under any further actual or contingent
                liability
                to the Finance Parties under or in connection with the Security
                Documents.

            

    

     

    

    
      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              1.1.45

            	
              "Fee
                Letter"
                means a letter or letters from the Agent to the Borrower setting
                out
                certain fees payable to the Agent in connection with the
                Facility.

            

    

     

    
      	 	
              1.1.46

            	
              "Final
                Balloon Payment"
                means an amount of thirty nine million two hundred thousand Dollars
                ($39,200,000), less any voluntary cancellation pursuant to Clause
                2.4.2 or
                any mandatory prepayment pursuant to Clause 2.4.3 or Clause 2.4.4,
                which
                shall be payable on the Termination
                Date.

            

    

     

    
      	 	
              1.1.47

            	
              "Finance
                Parties"
                means the Banks, the MLA and the
                Agent.

            

    

     

    
      	 	
              1.1.48

            	
              "Financial
                Indebtedness"
                means any indebtedness of any person for or in respect
                of:

            

    

     

    
      	 	
              (a)

            	
              moneys
                borrowed or raised;

            

    

     

    
      	 	
              (b)

            	
              amounts
                raised under any acceptance credit
                facility;

            

    

     

    
      	 	
              (c)

            	
              amounts
                raised pursuant to any note purchase facility or the issue of bonds,
                notes, debentures, loan stock or similar
                instruments;

            

    

     

    
      	 	
              (d)

            	
              amounts
                raised pursuant to any issue of shares of the relevant person which
                are
                expressed to be redeemable;

            

    

     

    
      	 	
              (e)

            	
              the
                amount of any liability in respect of leases or hire purchase contracts
                which would, in accordance with GAAP, be treated as finance or capital
                leases;

            

    

     

    
      	 	
              (f)

            	
              all
                reimbursement obligations whether contingent or not in respect of
                amounts
                paid under a letter of credit or similar
                instrument;

            

    

     

    
      	 	
              (g)

            	
              all
                interest rate, currency swap and similar agreements obliging the
                making of
                payments, whether periodically or upon the happening of a contingency
                (and
                the value of such indebtedness shall be the mark-to-market valuation
                of
                such transaction at the relevant
                time);

            

    

     

    

    
      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              (h)

            	
              amounts
                raised under any other transaction (including, without limitation,
                any
                forward sale or purchase agreement) having the commercial effect
                of a
                borrowing; and

            

    

     

    
      	 	
              (i)

            	
              any
                guarantee of indebtedness falling within paragraphs (a) to (i)
                above.

            

    

     

    
      	 	
              1.1.49

            	
              "First
                Reduction Date"
                means the date falling sixty six (66) calendar months after the Execution
                Date.

            

    

     

    
      	 	
              1.1.50

            	
              "GAAP"
                means either IFRS or the generally accepted accounting principles
                in the
                United States of America.

            

    

     

    
      	 	
              1.1.51

            	
              "Group"
                means GulfMark Offshore, Inc. and each of its
                Subsidiaries.

            

    

     

    
      	 	
              1.1.52

            	
              "Guarantee"
                means the guarantee and indemnity to be made by the Guarantor in
                favour of
                the Agent referred to in
                Clause 8.1.3.

            

    

     

    
      	 	
              1.1.53

            	
              "Guarantor"
                means GulfMark Offshore, Inc., a company incorporated according to
                the law
                of the State of Delaware whose principal place of business is
                at 10111 Richmond Avenue, Suite 340, Houston, Texas, 77042, the
                United States of America.

            

    

     

    
      	 	
              1.1.54

            	
              "IFRS"
                means International Financial Reporting Standards issued and/or adopted
                by
                the International Accounting Standards
                Board.

            

    

     

    
      	 	
              1.1.55

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

            

    

     

    
      	 	
              1.1.56

            	
              "Insurances",
                in relation to a Vessel, means all policies and contracts of insurance
                (including but not limited to hull and machinery, all entries in
                

            

    

     

    

    
      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

    

    

    protection
      and indemnity or war risks associations) which are from time to time taken
      out
      or entered into in respect of or in connection with that Vessel or her increased
      value and (where the context permits) all benefits thereof, including all claims
      of any nature and returns of premium.

     

    
      	 	
              1.1.57

            	
              "Interest
                Expense"
                means the interest paid by any member of the Group on the Total Debt
                in
                the twelve month period ending on a Determination
                Date.

            

    

     

    
      	 	
              1.1.58

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

            

    

     

    
      	 	
              1.1.59

            	
              "Interest
                Period"
                means each interest period selected by the Borrower or agreed by
                the Banks
                pursuant to Clause 6.

            

    

     

    
      	 	
              1.1.60

            	
              "ISM
                Code"
                means the International Ship Management Code for the Safe Operation
                of
                Ships and for Pollution Prevention.

            

    

     

    
      	 	
              1.1.61

            	
              "ISM
                Company"
                means, at any given time, the company responsible for a Vessel's
                compliance with the ISM Code under paragraph 1.1.2 of the ISM
                Code.

            

    

     

    
      	 	
              1.1.62

            	
              "ISPS
                Code"
                means the International Ship and Port Security Code as adopted by
                the
                Conference of Contracting Governments to the Safety of Life at Sea
                Convention 1974 on 13 December 2002 and incorporated as Chapter XI-2
                of
                the Safety of Life at Sea Convention
                1974.

            

    

     

    
      	 	
              1.1.63

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

            

    

     

    
      	 	
              1.1.64

            	
              "LIBOR"
                means:

            

    

     

    (a) the
      applicable Screen Rate; or 

     

    

    
      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

    

    

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

     

    
      	 	 	
              at
                11.00 a.m. (London time) on the Quotation Day for the offering of
                deposits
                in the currency in which the Facility is to be denominated during
                the
                relevant Interest Period in an amount comparable to the Facility
                (or any
                relevant part of the Facility) and for a period comparable to the
                relevant
                Interest Period.

            

    

     

    
      	 	
              1.1.65

            	
              "Majority
                Banks"
                means any one or more Banks whose combined Proportionate Shares exceed
                sixty six and two thirds per centum
                (662⁄3%).

            

    

     

    
      	 	
              1.1.66

            	
              "Manager"
                means GulfMark Offshore, Inc. or any entity within the
                Group.

            

    

     

    
      	 	
              1.1.67

            	
              "Mandatory
                Cost"
                means for each Bank to which it applies, the cost imputed to that
                Bank of
                compliance with the mandatory liquid asset requirements of the Bank
                of
                England and/or the banking supervision or other costs imposed by
                the
                Financial Services Authority, determined in accordance with Schedule
                 5 (Calculation of the Mandatory
                Cost).

            

    

     

    
      	 	
              1.1.68

            	
              "Margin"
                shall be calculated on, and effective from each Determination Date
                in
                accordance with the following grid based on the ratio of (a) the
                Guarantor's average Total Debt over the twelve (12) month period
                terminating on the relevant Determination Date to (b) the Guarantor's
                consolidated EBITDA determined on the relevant Determination
                Date:

            

    

     

    
      	
              Total
                Debt/EBITDA

               

            	 	
              Applicable
                Margin

               

            
	
              Less
                than 2.5

               

            	 	
              0.70%
                p.a.

               

            
	
              Equal
                to or greater than 2.5

               

            	 	 

    

    

    
      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

    

    

    

    
      	
              but
                less than 5.0

               

            	 	
              0.80%
                p.a.

               

            
	
              Equal
                to or greater than 5.0

               

            	 	
              0.90%
                p.a.

               

            

    

    

     

    
      	 	
              1.1.69

            	
              "Material
                Adverse Effect"
                means a material adverse change in, or a material adverse effect
                on:

            

    

     

    
      	 	
              (a)

            	
              the
                financial condition, assets, prospects or business of any Security
                Party
                or on the consolidated financial condition, assets, prospects or
                business
                of the Group;

            

    

     

    
      	 	
              (b)

            	
              the
                ability of any Security Party to perform and comply with its obligations
                under any Security Document or to avoid any Event of
                Default;

            

    

     

    
      	 	
              (c)

            	
              the
                validity, legality or enforceability of any Security Document;
                or

            

    

     

    
      	 	
              (d)

            	
              the
                validity, legality or enforceability of any security expressed to
                be
                created pursuant to any Security Document or the priority and ranking
                of
                any such security.

            

    

     

    1.1.70 "Material
      Subsidiary"
      means
      any Subsidiary of the Guarantor whose net asset value represents ten per cent
      (10%) or more of the net asset value of the Group, as indicated by the financial
      statements to be delivered to the Agent pursuant to Clause 10.2.1.

     

    
      	 	
              1.1.71

            	
              "Maximum
                Facility Amount"
                means an amount not exceeding sixty million Dollars ($60,000,000),
                subject
                to any reductions effected in accordance with Clauses 2.4, 15.7 and
                15.8.

            

    

     

    
      	 	
              1.1.72

            	
              "Mortgages"
                means the first priority ship mortgages together with collateral
                deed of
                covenants thereto over each of the Vessels made or to be made between
                the
                Borrower and the Agent referred to in Clause 8.1.1 (each a "Mortgage").

            

    

     

    1.1.73 "Net
      Earnings"
      means
      the Earnings less any Operating Commissions. 

     

    

    
      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

    

    

    1.1.74 "NIBOR"
      means
      the Norwegian interbank offered rate being the rate per annum equal to the
      offered quotation for deposits in amounts equal to that Drawing (and for periods
      equal to the Interest Period of that Drawing) appearing on Reuters Screen page
      NIBR, published by Reuters through its monitor service or any equivalent
      successor to such service at or about 12:00 p.m. (Oslo time) on the applicable
      Quotation Day or if no such rate is available, the arithmetic mean (rounded
      upwards to the nearest 1/16 of one per cent) of the rate per annum at which
      the
      Agent is able to acquire NOK in the amount and for the Interest Period equal
      to
      such Drawing in the Norwegian interbank market at or about 12:00 p.m. (Oslo
      time) on the applicable Quotation Day.

     

    1.1.75 "Norwegian
      Kroner"
      means
      the lawful currency of the Kingdom of Norway.

     

    1.1.76 "Optional
      Currency"
      means
      any of Dollars, Sterling, Euro and Norwegian Kroner.

     

    1.1.77 "Operating
      Commissions"
      means
      any commissions or fees payable by the Borrower in respect of any of the Vessels
      to any agents in respect of the chartering of the Vessels. 

     

    
      	 	
              1.1.78

            	
              "Participating
                Member State"
                means any member state of the European Community that adopts or has
                adopted the euro as its lawful currency in accordance with legislation
                of
                the European Community relating to Economic and Monetary
                Union.

            

    

     

    
      	 	
              1.1.79

            	
              "Party"
                means a party to this Agreement. 

            

    

     

    
      	 	
              1.1.80

            	
              "Permitted
                Liens"
                means (i) any Encumbrance which has the prior written approval of
                the
                Agent or (ii) any Encumbrances that arise either by operation of
                law or in
                the ordinary course of the business of the relevant Security Party
                which
                are discharged in the ordinary course of
                business.

            

    

     

    

    
      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              1.1.81

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

            

    

     

    
      	 	
              1.1.82

            	
              "Pre-Approved
                Classification Society"
                means any of Det norske Veritas, Lloyds Register of Shipping, American
                Bureau of Shipping (ABS), Germanischer Lloyd or Bureau
                Veritas.

            

    

     

    
      	 	
              1.1.83

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

            

    

     

    
      	 	
              1.1.84

            	
              "Proportionate
                Share"
                means, for each Bank, the percentage that its Commitment bears to
                the
                aggregate Commitments of all Banks from time to time, being initially
                the
                percentage indicated against the name of that Bank in Schedule
                1.

            

    

     

    1.1.85 "Quotation
      Day"
      means,
      in relation to any period for which an interest rate is to be determined
      :

     

    (a) (if
      the
      currency is sterling) the first day of that period; 

     

    (b) (if
      the
      currency is euro) two TARGET Days before the first day of that period; or

     

    (c) (for
      any
      other currency) two Business Days before the first day of that
      period,

     

    unless
      market practice differs in the relevant interbank market for a currency, in
      which case the Quotation Day will be determined by the Agent in accordance
      with
      market practice in that interbank market.

     

    
      	 	
              1.1.86

            	
              "Reference
                Banks"
                means the office of DnB NOR Bank ASA at Lars Hillesgate 30, PO Box
                7100,
                NO-5020 Bergen, Norway and The Royal Bank of Scotland plc at 1 Albyn
                Place, Aberdeen AB10 1BR, Scotland or such other banks as may be
                appointed
                by the Agent in consultation with the
                Borrower.

            

    

     

    

    
      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              1.1.87

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

            

    

     

    1.1.88 "Screen
      Rate"
      means:

     

    
      	 	
              (a)

            	
              in
                relation to LIBOR, the British Bankers' Association Interest Settlement
                Rate for the relevant currency and period;
                and

            

    

     

    
      	 	
              (b)

            	
              in
                relation to EURIBOR, the percentage rate per annum determined by
                the
                Banking Federation of the European Union for the relevant period;
                and

            

    

     

    
      	 	
              (c)

            	
              in
                relation to NIBOR, Reuters screen page
                NIBR,

            

    

     

    
      	 	 	
              displayed
                on the appropriate page of the Reuters screen. If the agreed page
                is
                replaced or the service ceases to be available, the Agent may specify
                another page or service displaying the appropriate rate after consultation
                with the Borrower and the Banks.

            

    

     

    1.1.89 "Security
      Documents"
      means
      this Agreement, the Assignments, the Mortgages, the Guarantee or (where the
      context permits) any one or more of them, and any other agreement or document
      which may at any time be executed as security for the payment of all or any
      part
      of the Indebtedness.

     

    1.1.90 "Security
      Parties"
      means,
      at any relevant time, the Borrower, the Guarantor and any other party who may
      at
      any time during the Facility Period be liable for, or provide security for,
      all
      or any part of the Indebtedness, and "Security
      Party"
      means
      any one of them. 

     

    1.1.91 "SMC"
      means a
      valid safety management certificate issued for a Vessel by or on behalf of
      the
      Administration under paragraph 13.7 of the ISM Code.

     

    1.1.92 "SMS"
      means,
      in relation to each Vessel, a safety management system for that Vessel developed
      and implemented in accordance with the ISM 

     

    

    
      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

    

    

    Code
      and
      including the functional requirements, duties and obligations required by the
      ISM Code.

     

    1.1.93 "Sterling"
      means
      the lawful currency of England.

     

    1.1.94 "Subsequent
      Reduction Dates"
      means
      each date falling at consecutive six monthly intervals after the previous
      Subsequent Reduction Date which in the case of the first Subsequent Reduction
      Date shall be six months after the First Reduction Date.

     

    1.1.95 "Subsidiary"
      means a
      subsidiary undertaking, as defined in section 736 Companies Act 1985, or any
      analogous definition under any other relevant system of law.

     

    1.1.96 "TARGET"
      means
      the Trans-European Automated Real-time Gross Settlement Express Transfer payment
      system.

     

    1.1.97 "TARGET
      Day"
      means
      any day on which TARGET is open for the settlement of payments in
      euro.

     

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

     

    
      	 	
              1.1.99

            	
              "Termination
                Date"
                means the seventh anniversary of the Execution
                Date.

            

    

     

    
      	 	
              1.1.100

            	
              "Total
                Assets"
                means the amount which is equal to the total consolidated assets
                of the
                Guarantor as shown in the Guarantor's latest audited consolidated
                balance
                sheet less the goodwill (if any) of the Guarantor as shown in the
                Guarantor's latest audited balance
                sheet.

            

    

     

    
      	 	
              1.1.101

            	
              "Total
                Debt"
                means the aggregate of:-

            

    

     

    (a) the
      amount calculated in accordance with GAAP shown as each of "long term debt",
      "short term debt" and "current portion of long 

     

    

    
      
        
          
          

        

        
          17

          
            

          

        

        
          
          

        

      

    

    

    term
      debt" on the latest consolidated balance sheet of the Guarantor;
      and

     

    (b) the
      amount of any liability in respect of any lease or hire purchase contract
      entered into by the Guarantor or any of its Subsidiaries which would, in
      accordance with GAAP, be treated as a finance or capital lease.

     

    
      	 	
              1.1.102

            	
              "Total
                Loss",
                in relation to a Vessel, means:- 

            

    

     

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

     

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

     

    (c) the
      capture, seizure, arrest, detention or confiscation of that Vessel, unless
      the
      Vessel is released and returned to the possession of the Borrower within thirty
      (30) days after the capture, seizure, arrest, detention or confiscation in
      question.

     

    
      	 	
              1.1.103

            	
              "Total
                Shareholders Equity"
                means the aggregate of the amount paid up on the issued share capital
                of
                any relevant entity and the amount standing to the credit of its
                capital
                and revenue reserves (including any share premium account or capital
                redemption reserve but excluding any revaluation reserve,) plus or
                minus
                the amount standing to the credit or debit (as the case may be) of
                its
                profit and loss account.

            

    

     

    
      	 	
              1.1.104

            	
              "Transfer
                Certificate"
                means a certificate materially in the form set forth in Schedule
                3 signed
                by a Bank and a Transferee
                whereby:-

            

    

     

    (a) such
      Bank
      seeks to procure the transfer to such Transferee of all or a part of such Bank's
      rights and obligations under this Agreement upon and subject to the terms and
      conditions set out in Clause 14; and

     

    (b) such
      Transferee undertakes to perform the obligations it will assume as a result
      of
      delivery of such certificate to the Agent 

     

    

    
      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

    

    

    and
      the
      Banks (other than the transferor Bank) as is contemplated in Clause
      14.

     

    
      	 	
              1.1.105

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

            

    

     

    1.1.106 "Transferee"
      means a
      bank or other financial institution to which a Bank seeks to transfer all or
      part of such Bank's rights and obligations under this Agreement.

     

    1.1.107 "Trust
      Property"
      means:-

     

    (a) the
      benefit of Clause 8 and the covenants contained in Clause 9.3;
      and

     

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

     

    1.1.108 "Valuation"
      means
      in relation to a Vessel the average of the written valuations of that Vessel
      expressed in Dollars prepared by two of the Approved Brokers (or such other
      firms of reputable independent shipbrokers as may be acceptable to the Majority
      Banks), to be nominated by the Borrower. Such valuations shall be prepared
      at
      the Borrower's expense (unless otherwise stated in this Agreement), without
      a
      physical inspection, on the basis of a sale for prompt delivery for cash at
      arm's length on a charter free basis between a willing buyer and a willing
      seller. 

     

    
      	 	
              1.1.109

            	
              "Vessels" means,
                subject to Clause 2.10, those vessels listed in Schedule 2 (each
                a "Vessel").

            

    

     

    1.2 Interpretation

     

    In
      this
      Agreement:-

     

    
      	 	
              1.2.1

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

            

    

     

    

    
      
        
          
          

        

        
          19

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              1.2.2

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

            

    

     

    
      	 	
              1.2.3

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

            

    

     

    
      	 	
              1.2.4

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

            

    

     

    
      	 	
              1.2.5

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

            

    

     

    
      	 	
              1.2.6

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

            

    

     

    
      	 	
              1.2.7

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

            

    

     

    
      	 	
              1.2.8

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

            

    

     

    
      	 	
              1.2.9

            	
              references
                to times of day are unless otherwise stated to London time;
                and

            

    

     

    
      	 	
              1.2.10

            	
              unless
                the contrary intention appears, a reference to a month or months
                is a
                reference to a period starting on one day in a calendar month and
                ending
                on the numerically corresponding day in the next calendar month or
                the
                calendar month in which it is to end, except
                that:

            

    

     

    (i) if
      the
      numerically corresponding day is not a Business Day, the period will end on
      the
      next Business Day in that month (if there is one) or the preceding Business
      Day
      (if there is not);

     

    

    
      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

    

    

    (ii) if
      there
      is no numerically corresponding day in that month, that period will end on
      the
      last Business Day in that month; and

     

    (iii) notwithstanding
      sub-paragraph (i) above, a period which commences on the last Business Day
      of a
      month will end on the last Business Day in the next month or the calendar month
      in which it is to end, as appropriate.

     

    
      	2  	
              The
                Facility and its Purpose

            

    

     

    
      	 	
              2.1

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

            

    

     

    
      	 	
              2.2

            	
              Drawings
                Subject
                to satisfaction by the Borrower of the conditions set out in
                Clause 3.1 (in respect of the first Drawing), or Clause 3.2 (in
                respect of all subsequent Drawings) and subject to Clause 2.3, and
                provided that the maximum aggregate amount of the Facility Outstandings
                at
                any given time during the Facility Period shall not exceed the Maximum
                Facility Amount, each Drawing shall be advanced to the Borrower,
                in each
                case by the Agent transferring the amount of the Drawing to such
                account
                as the Borrower shall notify to the Agent in the relevant Drawdown
                Notice
                by such same day method of funds transfer as the Agent shall
                select.

            

    

     

    
      	 	
              2.3

            	
              Advance
                of Drawings
                Each Drawing shall be advanced in the Base Currency. Each Drawing
                shall be
                advanced on a Business Day, provided that the Borrower shall have
                given to
                the Agent not more than ten and not fewer than three Business Days'
                notice
                in writing materially in the form set out in Schedule 4 of the required
                Advance Date of the Drawing in question and provided that the requested
                Drawing would not cause a breach of Clause 2.5. Each Drawdown Notice
                once
                given shall be irrevocable and shall constitute a warranty by the
                Borrower
                that:- 

            

    

     

    

    
      
        
          
          

        

        
          21

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              2.3.1

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

            

    

     

    
      	 	
              2.3.2

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

            

    

     

    
      	 	
              2.3.3

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

            

    

     

    The
      Agent
      shall promptly notify each Bank of the receipt of each Drawdown Notice,
      following which each Bank will make its Proportionate Share of the amount of
      the
      requested Drawing available to the Borrower through the Agent on the Advance
      Date requested.

     

    2.4 Facility
      Reduction

     

    
      	 	
              2.4.1

            	
              The
                aggregate amount of the Facility available to the Borrower for drawing
                under this Agreement shall be sixty million Dollars ($60,000,000)
                during
                the period from the Execution Date until the First Reduction Date.
                On the
                First Reduction Date and on each of the Subsequent Reduction Dates
                the
                amount of the Facility available for drawing shall be reduced by
                five
                million two hundred thousand Dollars ($5,200,000), which shall leave
                the
                Final Balloon Payment as being payable on the Termination Date. On
                the
                Termination Date the Facility available shall be reduced to zero.
                Subject
                to the proviso hereto, the mandatory reductions in the amount of
                the
                Facility available for drawing required pursuant to this Clause will
                be
                made in the amounts and at the times specified whether or not the
                Maximum
                Facility Amount is reduced pursuant to Clause 2.4.2, Clause 2.4.3,
                Clause
                2.4.4, Clause 15.7 or Clause 15.8. PROVIDED
                ALWAYS THAT
                any mandatory reductions pursuant to Clause 2.4.2 (voluntary reductions),
                Clause 2.4.3 (sale) or Clause 2.4.4 (Total Loss) shall be applied
                to the
                remaining mandatory reductions hereunder on a pro rata
                basis.

            

    

     

    
      	 	
              2.4.2

            	
              The
                Borrower may voluntarily cancel the Maximum Facility Amount in whole
                or in
                part in an amount of not less than five million Dollars
                

            

    

     

    

    
      
        
          
          

        

        
          22

          
            

          

        

        
          
          

        

      

    

    

    ($5,000,000)
      and shall be in integral multiples of one million Dollars ($1,000,000), provided
      that it has first given to the Agent not fewer than five (5) Business Days'
      prior written notice expiring on a Business Day (the "Cancellation
      Date")
      of its
      desire to reduce the Maximum Facility Amount. Such notice, once received by
      the
      Agent, shall be irrevocable and shall oblige the Borrower to make payment of
      all
      interest and Commitment Commission accrued on the amount so cancelled up to
      and
      including the Cancellation Date together with any Break Costs in respect of
      such
      cancelled amount if the Cancellation Date is not an Interest Payment Date.
      Any
      such reduction in the Maximum Facility Amount:

     

    (a) shall
      not
      be reversed; and 

     

    (b) shall
      be
      applied against the Final Balloon Payment, and the Final Balloon Payment shall
      be reduced by the same amount as any such reduction of the Maximum Facility
      Amount. 

     

    2.4.3 In
      the
      event of a sale or disposal of a Vessel, if the aggregate Valuation of the
      remainder of the Vessels is less than one hundred and seventy five per cent
      (175%) of the Maximum Facility Amount, then the whole of the net sales proceeds
      shall be applied as a mandatory prepayment and the Maximum Facility Amount
      shall
      be reduced by an amount equal to such prepayment. Such reduction shall be made
      on the date of such sale or disposal. If the aggregate Valuation of the
      remainder of the Vessels is between one hundred and seventy five per cent (175%)
      and two hundred per cent (200%) of the Maximum Facility Amount, then no
      prepayment shall be required and there shall be no reduction to the Maximum
      Facility Amount until such time as seventeen million five hundred thousand
      Dollars ($17,500,000) has been released under this Clause 2.4.3 when aggregated
      with those amounts similarly released under Clause 2.4.4, whereupon the whole
      of
      any further net sales proceeds shall be applied as a mandatory prepayment and
      the Maximum Facility Amount shall be reduced by an amount equal to such
      prepayment. If the aggregate Valuation of the remainder of the Vessels is above
      two hundred per cent (200%) of the Maximum Facility Amount then no prepayment
      shall be required and there shall be no reduction to the Maximum Facility

     

    

    
      
        
          
          

        

        
          23

          
            

          

        

        
          
          

        

      

    

    

    Amount.
      In each case, the Valuations used shall be that attached to the then most
      recently delivered Compliance Certificate. Any such prepayment shall oblige
      the
      Borrower to make payment of all interest and Commitment Commission accrued
      on
      the amount so reduced up to and including the date of reduction together with
      any Break Costs in respect of such reduced amount if the date of such reduction
      is not an Interest Payment Date. Any such reduction in the Maximum Facility
      Amount: 

     

    (a) shall
      not
      be reversed; and 

     

    (b) shall
      be
      applied against the Final Balloon Payment, and the Final Balloon Payment shall
      be reduced by the same amount as any such reduction of the Maximum Facility
      Amount. 

     

    
      	 	
              2.4.4

            	
              In
                the event that a Vessel becomes a Total Loss, on the earlier to occur
                of
                (a) the date of receipt of the proceeds of the Total Loss and (b)
                the date
                falling one hundred and eighty (180) days after the occurrence of
                the
                Total Loss (the "Reduction
                Date"),
                if the aggregate Valuation of the remainder of the Vessels is less
                than
                one hundred and seventy five per cent (175%) of the Maximum Facility
                Amount then the whole of any total loss proceeds shall be applied
                as a
                mandatory prepayment and the Maximum Facility Amount shall be reduced
                by
                an amount equal to such prepayment. If the aggregate Valuation of
                the
                remainder of the Vessels is between one hundred and seventy five
                per cent
                (175%) and two hundred per cent (200%) of the Maximum Facility Amount,
                then no prepayment shall be required and there shall be no reduction
                to
                the Maximum Facility Amount until such time as seventeen million
                five
                hundred thousand Dollars ($17,500,000) has been released under this
                Clause
                2.4.4 when aggregated with those amounts similarly released under
                Clause
                2.4.3, whereupon the whole of any further total loss proceeds shall
                be
                applied as a mandatory prepayment and the Maximum Facility Amount
                shall be
                reduced by an amount equal to such prepayment. If the aggregate Valuation
                of the remainder of the Vessels is above two hundred per cent (200%)
                of
                the Maximum Facility Amount, then no prepayment shall be required
                and
                there shall be no reduction to the Maximum Facility Amount. In each
                case,
                the Valuation used shall be that attached to the
                

            

    

     

    

    
      
        
          
          

        

        
          24

          
            

          

        

        
          
          

        

      

    

    

    then
      most
      recently delivered Compliance Certificate. Any such prepayment shall oblige
      the
      Borrower to make payment of all interest and Commitment Commission accrued
      on
      the amount so reduced up to and including the date of reduction together with
      any Break Costs in respect of such reduced amount if the date of such reduction
      is not an Interest Payment Date. Any such reduction in the Maximum Facility
      Amount: 

     

    (a) shall
      not
      be reversed; and 

     

    (b) shall
      be
      applied against the Final Balloon Payment, and the Final Balloon Payment shall
      be reduced by the same amount as any such reduction of the Maximum Facility
      Amount. 

     

    
      	 	
              2.4.5

            	
              To
                the extent that repayments or prepayments made by the Borrower to
                the
                Agent in accordance with this Agreement reduce the Facility Outstandings
                to less than the Maximum Facility Amount, the Borrower shall again
                be
                entitled to make Drawings up to the Commitment Termination Date in
                accordance with and subject to the terms of this Agreement. Any part
                of
                the Facility which is undrawn on the Commitment Termination Date
                shall be
                automatically cancelled.

            

    

     

    
      	 	
              2.4.6

            	
              Simultaneously
                with each reduction of the Maximum Facility Amount in accordance
                with
                Clause 2.4.1, Clause 2.4.2, Clause 2.4.3 or Clause 2.4.4, (as the
                case may
                be), the Commitment of each Bank will reduce so that the Commitments
                of
                the Banks in respect of the reduced Maximum Facility Amount remain
                in
                accordance with their respective Proportionate
                Shares.

            

    

     

    
      	 	
              2.5

            	
              Restrictions
                on Drawings
                The Borrower shall not be entitled to make more than one Drawing
                on any
                Business Day and no more than five (5) Drawings may be outstanding
                at any
                one time during the Facility Period. Each Drawing shall be of an
                amount of
                not less than four million Dollars ($4,000,000) and shall be in integral
                multiples of one million Dollars ($1,000,000), or the equivalent
                in an
                Optional Currency. If at any time during the Facility Period the
                Facility
                Outstandings exceed the Maximum Facility Amount then available or
                if a
                proposed Drawing added to the Facility Outstandings would result
                in the
                Maximum Facility Amount being exceeded then the Borrower shall immediately
                

            

    

     

    

    
      
        
          
          

        

        
          25

          
            

          

        

        
          
          

        

      

    

    

    pay
      to
      the Agent on behalf of the Banks such amounts as will ensure that the Facility
      Outstandings are equal to or less than the Maximum Facility Amount then
      available. 

     

    
      	 	
              2.6

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

            

    

     

    
      	 	
              2.7

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

            

    

     

    
      	 	
              2.8

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

            

    

     

    
      	 	
              2.9

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

            

    

     

    
      	 	
              2.10

            	
              Substitute
                Vessels
                It
                is agreed and acknowledged that the Borrower may request amendments
                to the
                list of Vessels set out at Schedule 2. Any such request shall be
                considered by the Banks acting reasonably, and subject
                to:

            

    

     

    2.10.1 the
      Banks
      being satisfied that the replacement vessels are:

     

    (i) offshore
      PSVs or AHTSs of the Borrower's usual standard and quality;

     

    (ii) registered
      in an acceptable registry and classed with a Pre-Approved Classification
      Society;

     

    (iii) built
      no
      earlier than 2000 and being no more than two (2) years older than the Vessel
      it
      is to replace;

     

    (iv) have
      a
      Valuation no less than eighty per cent (80%) of the Valuation of the Vessel
      to
      be replaced;

     

    

    
      
        
          
          

        

        
          26

          
            

          

        

        
          
          

        

      

    

    

    2.10.2 the
      Borrower, as owner of the replacement vessel, granting security over such
      replacement vessel equivalent to the other Security Documents; and

     

    2.10.3 the
      Agent
      receiving such conditions precedent (including but not limited to corporate
      papers and legal opinions) as it may reasonably require,

     

    the
      Banks
      shall consent to such substitutions and the definition of "Vessels"
      shall
      be amended accordingly.

     

    
      	3  	
              Conditions Precedent and Subsequent 

            

    

     

    
      	 	
              3.1

            	
              Conditions
                Precedent
                -
                First
                Drawing Before
                any Bank shall have any obligation to advance the first Drawing under
                the
                Facility, the Borrower shall pay to the Agent the relevant fees referred
                to in Clause 7 and deliver or cause to be delivered to or to the
                order of
                the Agent the following documents and
                evidence:-

            

    

     

    
      	 	
              3.1.1

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

            

    

     

    
      	 	
              3.1.2

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

            

    

     

    
      	 	
              3.1.3

            	
              Officer's
                certificate A
                certificate (i) signed by a duly authorised officer or representative
                of
                each of the Security Parties setting out the names of
                

            

    

     

    

    
      
        
          
          

        

        
          27

          
            

          

        

        
          
          

        

      

    

    

    the
      directors and officers of that Security Party and (ii) issued by each Security
      Party's company registry confirming due incorporation and valid existence and
      (when such information is maintained by the registry) the names of its directors
      and shareholders.

     

    
      	 	
              3.1.4

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

            

    

     

    
      	 	
              3.1.5

            	
              The
                Security Documents The
                Security Documents, together with all notices and other documents
                required
                by any of them, duly executed.

            

    

     

    
      	 	
              3.1.6

            	
              Drawdown
                Notice A
                duly completed Drawdown Notice.

            

    

     

    
      	 	
              3.1.7

            	
              Legal
                opinions Confirmation
                satisfactory to the Agent that all legal opinions required by the
                Agent
                and the Finance Parties will be given substantially in the form required
                by the Agent and the Finance
                Parties.

            

    

     

    
      	 	
              3.1.8

            	
              Consents
                A
                certificate from the Borrower that all (if any) consents, licences,
                approvals and authorisations of, or registrations with or declarations
                to,
                any governmental authority, bureau or agency which may be required
                in
                connection with the Security Documents have been made or obtained
                and
                remain in full force and effect.

            

    

     

    
      	 	
              3.1.9

            	
              Fee
                Letter The
                Fee Letter duly signed and payment of all fees that have fallen due
                thereunder.

            

    

     

    
      	 	
              3.1.10

            	
              Accounts
                The
                audited consolidated accounts for the Guarantor for the year ended
                2005.

            

    

     

    
      	 	
              3.1.11

            	
              Evidence
                of Borrower's title Evidence
                that on the date of the Drawing (i) the Vessels are registered under
                the
                flag stated in Schedule 2 in the ownership of the Borrower and (ii)
                the
                relevant Mortgages will be capable of being immediately registered
                against
                the Vessels with first priority.

            

    

     

    
      	 	
              3.1.12

            	
              Evidence
                of insurance Evidence
                that the Vessels are insured in the manner required by the Security
                Documents and that letters of undertaking will be issued in the manner
                required by the Security Documents, together

            

    

     

    

    
      
        
          
          

        

        
          28

          
            

          

        

        
          
          

        

      

    

    

    with
      a
      written opinion on the Insurances from an insurance adviser appointed by the
      Agent.

     

    
      	 	
              3.1.13

            	
              Confirmation
                of class A Certificate
                of Confirmation of Class for hull and machinery confirming that the
                Vessels are classed with the highest class applicable to vessels
                of her
                type with a Pre-Approved Classification
                Society.

            

    

     

    
      	 	
              3.1.14

            	
              Vessel
                Documents Photocopies,
                certified as true, accurate and complete by an authorised signatory
                of the
                Borrower, of:

            

    

     

    (i) current
      SMC of each of the Vessels; and

     

    (ii) each
      ISM
      Company's current DOC,

     

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

            

    

     

    
      	 	
              3.2

            	
              Conditions
                Precedent
                -
                Subsequent
                Drawings Before
                any Bank shall have any obligation to advance any subsequent Drawings
                under the Facility, the Borrower shall deliver or cause to be delivered
                to
                the order of the Agent:

            

    

     

    3.2.1 Officer's
      certificate
      A
      certificate signed by a duly authorised officer of each Security Party dated
      no
      later than five (5) Business Days before the date of the Drawing confirming
      that
      none of the documents and evidence delivered to the Agent pursuant to Clauses
      3.1.1, 3.1.2, 3.1.3 and 3.1.4 has been amended, modified or revoked in any
      way
      since its delivery to the Agent. 

     

    3.2.2 Drawdown
      Notice
      Drawdown
      Notice.

     

    3.3 Conditions
      Subsequent
      The
      Borrower undertakes to deliver or to cause to be delivered to the Agent on,
      or,
      in respect of Clause 3.3.1 not later than ten (10) days, or in respect of Clause
      3.3.2 not later than fifteen (15) Business Days, or such other period as the
      Agent may have consented to after the first Advance Date the following
      additional documents and evidence:-

     

    
      	 	
              3.3.1

            	
              Letters
                of undertaking
                Letters of undertaking in respect of the Insurances as required by
                the
                Security Documents together with copies of

            

    

     

    

    
      
        
          
          

        

        
          29

          
            

          

        

        
          
          

        

      

    

    

    the
      relevant policies or cover notes or entry certificates duly endorsed with the
      interest of the Agent. 

     

    
      	 	
              3.3.2

            	
              Evidence
                of Borrower's title
                Certificates of ownership and encumbrance (or equivalent) issued
                by the
                Registrar of Ships (or equivalent official) of the relevant Vessel's
                flag
                state confirming that (a) the Vessels are permanently registered
                under
                that flag in the ownership of the Borrower (b) the Mortgages have
                been
                registered with first priority against the Vessels and (c) there
                are no
                further Encumbrances registered against the
                Vessels.

            

    

     

    
      	 	
              3.4

            	
              No
                waiver If
                the Banks in their sole discretion agree to advance any part of the
                Facility to the Borrower before all of the documents and evidence
                required
                by Clause 3.1 or Clause 3.2 (as the case may be) have been delivered
                to or
                to the order of the Agent, the Borrower undertakes to deliver all
                outstanding documents and evidence to or to the order of the Agent
                no
                later than the date agreed by the Agent and the Borrower and the
                advance
                of any part of the Facility shall not be taken as a waiver of the
                Agent's
                right to require production of all the documents and evidence required
                by
                Clause 3.1 or Clause 3.2 (as the case may
                be).

            

    

     

    
      	 	
              3.5

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

            

    

     

    
      	 	
              3.5.1

            	
              be
                in form and substance reasonably acceptable to the Agent;
                

            

    

     

    
      	 	
              3.5.2

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

            

    

     

    
      	 	
              3.5.3

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

            

    

     

    
      	4  	
              Representations
                and Warranties

            

    

     

    The
      Borrower represents and warrants to each of the Finance Parties at the Execution
      Date and (by reference to the facts and circumstances then pertaining) at the
      date of each Drawdown Notice, at each Advance Date and at each Interest Payment
      Date as follows (except that the representation and warranty contained at Clause
      4.17 shall only be made 

     

    

    
      
        
          
          

        

        
          30

          
            

          

        

        
          
          

        

      

    

    

    on
      the
      first Advance Date and that the representation and warranty contained at Clause
      4.9 shall only be made on the Execution Date) :-

     

    
      	 	
              4.1

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

            

    

     

    
      	 	
              4.2

            	
              Solvency
                None
                of the Security Parties is insolvent or in liquidation or administration
                or subject to any other insolvency procedure, and no receiver,
                administrative receiver, administrator, liquidator, trustee or analogous
                officer has been appointed in respect of any of the Security Parties.
                For
                this purpose a Security Party will be deemed insolvent if it is unable
                to
                pay its debts within the meaning of S.123 of the Insolvency Act
                1986.

            

    

     

    
      	 	
              4.3

            	
              Binding
                obligations The
                Security Documents when duly executed and delivered will constitute
                the
                legal, valid and binding obligations of the Security Parties enforceable
                in accordance with their respective terms subject to applicable laws
                regarding creditors' rights in
                general.

            

    

     

    
      	 	
              4.4

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

            

    

     

    
      	 	
              4.5

            	
              Registrations
                and consents All
                (if any) consents, licences, approvals and authorisations of, or
                registrations with or declarations to, any governmental authority,
                bureau
                or agency which may be required in connection with the execution,
                delivery, performance, validity or enforceability of the Security
                Documents have been obtained or made and remain in full force and
                effect
                and 

            

    

     

    

    
      
        
          
          

        

        
          31

          
            

          

        

        
          
          

        

      

    

    

    the
      Borrower is not aware of any event or circumstance which could reasonably be
      expected adversely to affect the right of any of the Security Parties to hold
      and/or obtain renewal of any such consents, licences, approvals or
      authorisations.

     

    
      	 	
              4.6

            	
              Disclosure
                of material facts The
                Borrower is not aware of any material facts or circumstances which
                have
                not been disclosed to the Agent and which might, if disclosed, have
                reasonably been expected to adversely affect the decision of a person
                considering whether or not to make facilities of the nature contemplated
                by this Agreement available to the
                Borrower.

            

    

     

    
      	 	
              4.7

            	
              No
                material litigation There
                is no action, suit, arbitration or administrative proceeding nor
                any
                contemplated action, suit, arbitration or administrative proceeding
                pending or to its knowledge about to be pursued before any court,
                tribunal
                or governmental or other authority which is not covered by adequate
                insurance which would, or would be likely to, have a Material Adverse
                Effect.

            

    

     

    
      	 	
              4.8

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

            

    

     

    
      	 	
              4.9

            	
              No
                deductions
                To
                the best of its knowledge belief and without undue enquiry, none
                of the
                Security Parties is required to make any deduction or withholding
                from any
                payment which it may be obliged to make to any of the Finance Parties
                under or pursuant to the Security
                Documents.

            

    

     

    
      	 	
              4.10

            	
              Use
                of Facility
                The Facility will be used for the purpose specified in the
                recital.

            

    

     

    
      	 	
              4.11

            	
              Material
                Adverse Change
                There has been no change in the business, assets, operations or condition
                (financial or otherwise) of any of the Security Parties or in the
                facts
                and information regarding such entities as represented to date which
                constitutes a Material Adverse
                Effect.

            

    

     

    

    
      
        
          
          

        

        
          32

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              4.12

            	
              No
                default
                None of the Security Parties is in default of its obligations under
                any
                other financing documents to which it is a party to an extent or
                in a
                manner which might have a Material Adverse Effect on the business
                or
                condition (financial or otherwise) of that Security Party and no
                Event of
                Default is continuing or might reasonably be expected to result from
                the
                advance of any Drawing.

            

    

     

    
      	 	
              4.13

            	
              Pari
                passu ranking
                The payment obligations of each of the Security Parties under the
                Security
                Documents to which it is a party rank at least pari passu with the
                claims
                of all its other unsecured and unsubordinated creditors, except for
                obligations mandatorily preferred by law applying to companies
                incorporated in the relevant Security Party's country of incorporation
                or
                otherwise applicable to that Security
                Party.

            

    

     

    
      	 	
              4.14

            	
              No
                Immunity
                In
                any proceedings taken in any of the Security Parties' respective
                jurisdictions of incorporation in relation to any of the Security
                Documents, none of the Security Parties will be entitled to claim
                for
                itself or any of its assets immunity from suit, execution, attachment
                or
                other legal process.

            

    

     

    
      	 	
              4.15

            	
              Governing
                Law and Judgments
                In
                any proceedings taken in any of the Security Parties' jurisdiction
                of
                incorporation or organisation in relation to any of the Security
                Documents
                in which there is an express choice of the law, the submission to
                that
                jurisdiction of a particular country as the governing law thereof,
                that
                choice of law and any judgment or (if applicable) arbitral award
                obtained
                in that country will be recognised and
                enforced.

            

    

     

    
      	 	
              4.16

            	
              Validity
                and Admissibility in Evidence
                As
                at the date hereof, all acts, conditions and things required to be
                done,
                fulfilled and performed in order (a) to enable each of the Security
                Parties lawfully to enter into, exercise its rights under and perform
                and
                comply with the obligations expressed to be assumed by it in the
                Security
                Documents, (b) to ensure that the obligations expressed to be assumed
                by
                each of the Security Parties in the Security Documents are legal,
                valid
                and binding and (c) to make the Security Documents admissible in
                evidence
                in the jurisdictions of incorporation or organization of each of
                the
                Security Parties, have been done, fulfilled and
                performed.

            

    

     

    

    
      
        
          
          

        

        
          33

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              4.17

            	
              No
                Filing or Stamp Taxes Under
                the laws of the Security Parties' respective jurisdictions of
                incorporation or organisation in force at the date hereof, it is
                not
                necessary that any of the Security Documents be filed, recorded or
                enrolled with any court or other authority in its jurisdiction of
                incorporation or organisation (other than the Registrar of Companies
                for
                England and Wales, or the Maritime Coastguard Agency in England,
                to the
                extent applicable) or that any stamp, registration or similar tax
                be paid
                on or in relation to any of the Security
                Documents.

            

    

     

    
      	 	
              4.18

            	
              Accounts
                The
                first set of Accounts and all other annual financial statements relating
                to the Group required to be delivered, were prepared in accordance
                with
                GAAP, give (in conjunction with the notes thereto) a true and fair
                view of
                (in the case of annual financial statements) or fairly represent
                (in the
                case of quarterly accounts) the financial condition of the Group
                at the
                date as of which they were prepared and the results of the Group’s
                operations during the financial period then
                ended.

            

    

     

    
      	 	
              4.19

            	
              Ownership
                and Security
                Each of the Security Parties is the legal and beneficial owner of
                all
                assets and other property which it purports to charge, mortgage,
                pledge,
                assign or otherwise secure pursuant to each Security Document and
                those
                Security Documents to which it is a party create and give rise to
                valid
                and effective Security having the ranking expressed in those Security
                Documents.

            

    

     

    4.20 Money
      Laundering Any
      amount borrowed hereunder, and the performance of the obligations of the
      Security Parties under the Security Documents, will be for the account of
      members of the Group and will not involve any breach by any of them of any
      law
      or regulatory measure relating to "money laundering" as defined in Article
      1 of
      the Directive (91/308/EEC) of the Council of the European
      Communities.

     

    
      	5  	
              Repayment,
                Prepayment
                and Currency Option

            

    

     

    
      	 	
              5.1

            	
              Repayment
                Each
                Drawing shall be repaid by the Borrower to the Agent on behalf of
                the
                Banks on the last day of its Interest Period unless the Borrower
                selects a
                further Interest Period for that Drawing in accordance with Clause
                6,
                provided that the Borrower shall not be permitted to select such
                further
                Interest Period if an Event of Default or Potential Event of Default
                has
                occurred and shall 

            

    

     

    

    
      
        
          
          

        

        
          34

          
            

          

        

        
          
          

        

      

    

    

    then
      be
      obliged to repay such Drawing on the last day of its then current Interest
      Period. The Borrower shall on the Termination Date repay to the Agent as agent
      for the Banks all Facility Outstandings.

     

    
      	 	
              5.2

            	
              Prepayment
                The
                Borrower may prepay the Facility Outstandings in whole or in part
                in
                integral multiples of one million Dollars ($1,000,000) (or as otherwise
                may be agreed by the Agent), each such prepayment to be of a minimum
                amount of five million Dollars ($5,000,000), provided that it has
                first
                given to the Agent not fewer than five (5) days prior written notice
                expiring on a Business Day of its intention to do so. Any notice
                pursuant
                to this Clause 5.2 once given shall be irrevocable and shall oblige
                the
                Borrower to make the prepayment referred to in the notice on the
                Business
                Day specified in the notice, together with all interest accrued on
                the
                amount prepaid up to and including that Business
                Day.

            

    

     

    
      	 	
              5.3

            	
              Mandatory
                Prepayment If
                at any time the Facility Outstandings shall exceed the Maximum Facility
                Amount the Borrower shall immediately prepay to the Agent on behalf
                of the
                Banks such amounts as will ensure that the Facility Outstandings
                do not
                exceed the Maximum Facility Amount and shall pay to the Banks all
                interest
                accrued on the amount prepaid up to and including the date on which
                such
                prepayment occurred.

            

    

     

    
      	 	
              5.4

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

            

    

     

    
      	 	
              5.5

            	
              Application
                of prepayments Any
                prepayment by the Borrower in an amount less than the Indebtedness
                shall
                be applied in satisfaction or reduction first of any costs and other
                expenses outstanding; secondly of all interest accrued with respect
                to the
                outstanding Drawings; and thirdly of the outstanding
                Drawings.

            

    

     

    
      	 	
              5.6

            	
              Reborrowing
                of prepayments Any
                amount prepaid pursuant to this Agreement, which for the avoidance
                of
                doubt shall exclude any amount prepaid pursuant to Clause 2.4.2,
                Clause
                2.4.3 or Clause 2.4.4, may be reborrowed in accordance with Clause
                2.2.

            

    

     

    

    
      
        
          
          

        

        
          35

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              5.7

            	
              Selection
                of currency The
                Borrower may from time to time select in a written notice to the
                Agent
                given not later than 11.00am on the Quotation Day for the relevant
                Interest Period that the Facility shall be denominated for the next
                Interest Period (which may include the first Interest Period) in
                an
                Optional Currency.

            

    

     

    
      	 	
              5.8

            	
              Unavailability
                of a currency If:

            

    

     

    5.8.1 a
      Bank
      notifies the Agent that the Optional Currency requested is not readily available
      to it in the amount required; or 

     

    5.8.2 a
      Bank
      notifies the Agent that to make an advance in that Optional Currency would
      contravene a law or regulation applicable to it,

     

    the
      Agent
      will promptly give notice to the Borrower to that effect. In this event any
      Bank
      that gives notice pursuant to this Clause 5.8 will be required to
      participate in the Facility during the relevant Interest Period in the Base
      Currency (in an amount equal to that Bank's proportion of the Base Currency
      Amount) and its participation will be treated as a separate Facility denominated
      in the Base Currency during that Interest Period.

     

    5.9 Change
      of currency If
      the
      Facility is to be denominated in different currencies during two successive
      Interest Periods:

     

    5.9.1 the
      following provisions shall apply:

     

    (a) if
      the
      currency for the second Interest Period is an Optional Currency, the amount
      of
      the Facility in that Optional Currency will be calculated by the Agent as the
      amount of that Optional Currency equal to the Base Currency Amount of the
      Facility at the Agent's Spot Rate of Exchange two (2) Business Days before
      the
      first day of the second Interest Period;

     

    (b) if
      the
      currency for the second Interest Period is the Base Currency, the amount of
      the
      Facility will be equal to the Base Currency Amount;

     

    (c) the
      Borrower shall repay the Facility on the last day of the first Interest Period
      in the currency in which it was denominated for that Interest Period;
      and

     

    

    
      
        
          
          

        

        
          36

          
            

          

        

        
          
          

        

      

    

    

    (d) the
      Banks
      shall re-advance the Facility in the new currency in accordance with Clause
      5.10;

     

    5.9.2 the
      Agent
      shall:

     

    (a) apply
      the
      amount to be readvanced by the Banks under Clause 5.9.1(d) (or so much of that
      amount as is necessary) in or towards the purchase of an amount in the currency
      in which the Facility is outstanding for the first Interest Period;
      and

     

    (b) use
      the
      amount it purchases in or towards satisfaction of the Borrower's obligations
      under Clause 5.9.1(c);

     

    5.9.3 if
      the
      amount purchased by the Agent under Clause 5.9.2(a) is less than the amount
      required to be repaid by the Borrower, the Agent shall promptly notify the
      Borrower and the Borrower shall, on the last day of the first Interest Period,
      pay an amount to the Agent (for the account of the Banks) (in the currency
      of
      the Facility for the first Interest Period) equal to the
      difference;

     

    5.9.4 if
      any
      part of the amount to be readvanced by the Banks under Clause 5.9.1(d) is not
      needed to purchase the amount required to be repaid by the Borrower, the Agent
      shall promptly notify the Borrower and pay the Borrower on the last day of
      the
      first Interest Period that part of that amount (in the new
      currency).

     

    5.10 Same
      Optional Currency during successive Interest Periods If
      the
      Facility is to be denominated in the same Optional Currency during two
      successive Interest Periods, the Agent shall calculate the amount of the
      Facility in the Optional Currency for the second of those Interest Periods
      (by
      calculating the amount of Optional Currency equal to the Base Currency Amount
      of
      the Facility at the Agent's Spot Rate of Exchange two (2) Business Days before
      the first day of the second Interest Period) and (subject to Clause
      5.10.2):

     

    (i) if
      the
      amount calculated is less than the existing amount of the Facility in the
      Optional Currency during the first Interest Period, promptly notify the Borrower
      and the Borrower shall pay to the Agent (for the account of the 

     

    

    
      
        
          
          

        

        
          37

          
            

          

        

        
          
          

        

      

    

    

    Banks),
      on the last day of the first Interest Period, an amount equal to the difference;
      or

     

    (ii) if
      the
      amount calculated is more than the existing amount of the Facility in the
      Optional Currency during the first Interest Period, if no Event of Default
      is
      continuing, each Bank shall, on the last day of the first Interest Period,
      pay
      to the Borrower through the Agent its participation in an amount equal to the
      difference;

     

    
      	 	
              5.11

            	
              Agent's
                calculations All
                calculations made by the Agent under this Clause 5 will take into
                account
                any repayment or prepayment of the Facility to be made on the last
                day of
                the first Interest Period.

            

    

     

    
      	6  	
              Interest

            

    

     

    
      	 	
              6.1

            	
              Interest
                Periods
                The period during which any Drawing shall be outstanding pursuant
                to this
                Agreement shall be divided into consecutive Interest Periods of one,
                three
                or six months' duration, as selected by the Borrower by written notice
                to
                the Agent not later than 3:00 p.m. on the fourth Business Day before
                the
                beginning of the Interest Period in question, or such other duration
                as
                may be agreed by the Banks in their discretion. No more than three
                one (1)
                month Interest Periods may be selected by the Borrower in each twelve
                (12)
                month period during the Facility
                Period.

            

    

     

    
      	 	
              6.2

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

            

    

     

    
      	 	
              6.3

            	
              Interest
                rate
                During each Interest Period, interest shall accrue on each Drawing
                at the
                rate determined by the Agent to be the aggregate of (a) the Margin
                (b)
                LIBOR (or, if the Facility is denominated in Euro, EURIBOR, or, if
                the
                Facility is denominated in NOK, NIBOR) and (c), if applicable, the
                Mandatory Cost 

            

    

     

    

    
      
        
          
          

        

        
          38

          
            

          

        

        
          
          

        

      

    

    

    determined
      at or about 11.00 a.m. (London time) on the second Business Day prior to the
      beginning of the Interest Period relating to that Drawing. 

     

    
      	 	
              6.4

            	
              Accrual
                and payment of interest During
                the Facility Period, interest
                shall accrue from day to day, shall be calculated on the basis of
                a 360
                day year (or, for any period when the Facility is denominated in
                Sterling
                on the basis of a 365 day year) and the actual number of days elapsed
                (or,
                in any circumstance where market practice differs, in accordance
                with the
                prevailing market practice) and shall be paid by the Borrower to
                the Agent
                on behalf of the Banks on the last day of each Interest Period and
                additionally, during any Interest Period exceeding six months, on the
                last day of each successive six month period after the beginning of
                that Interest Period.

            

    

     

    
      	 	
              6.5

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

            

    

     

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

     

    6.7 Absence
      of quotations
      If LIBOR
      or, if applicable, EURIBOR or NIBOR is to be determined by reference to the
      Reference Banks but a Reference Bank does not supply a quotation by 11.00 am
      (London time) in respect of LIBOR, 11.00 am (Brussels time) in respect of
      EURIBOR or 12.00 pm (Oslo time) in respect NIBOR, the applicable LIBOR, EURIBOR
      or NIBOR shall be determined on the basis of the quotations obtained from such
      other banks as may be appointed by the Agent in consultation with the Borrower.
      

     

    
      	 	
              6.8

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

            

    

     

    

    
      
        
          
          

        

        
          39

          
            

          

        

        
          
          

        

      

    

    

    

     

    
      	7  	
              Fees

            

    

     

    
      	 	
              7.1

            	
              The
                Borrower shall pay to the Agent for distribution to the Banks Commitment
                Commission at the rate of forty per centum (40%) of the applicable
                Margin
                on any undrawn and uncancelled part of the Facility. The Commitment
                Commission will accrue from day to day on the basis of a 360 day
                year and
                the actual number of days elapsed and shall be paid quarterly in
                arrears
                from 15 March 2006 until the Commitment Termination Date with a pro
                rata
                payment being due and payable on the Commitment Termination
                Date.

            

    

     

    
      	 	
              7.2

            	
              The
                Borrower shall pay to the Agent the fees detailed in the Fee
                Letter.

            

    

     

    
      	 	
              7.3

            	
              All
                fees and commissions hereunder or under the Fee Letter shall be calculated
                by reference to, and payable in, the Base
                Currency.

            

    

     

    
      	8  	
              Security
                Documents

            

    

     

    
      	 	
              8.1

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

            

    

     

    
      	 	
              8.1.1

            	
              the
                Mortgages
                the first priority ship mortgages together with collateral deeds
                of
                covenant thereto over each of the Vessels executed by the Borrower.
                

            

    

     

    
      	 	
              8.1.2

            	
              the
                Assignments
                the assignments of the Insurances and Requisition Compensation in
                respect
                of each of the Vessels executed by the Borrower.
                

            

    

     

    
      	 	
              8.1.3

            	
              the
                Guarantee the
                guarantee and indemnity of the Guarantor in favour of the
                Agent.

            

    

     

    
      	9  	
              Agency
                and Trust

            

    

     

    
      	 	
              9.1

            	
              Appointment
                Each
                of the Finance Parties appoints the Agent its agent for the purpose
                of
                administering the Facility and the Security Documents and authorises
                the
                Agent and its directors, officers, employees and agents acting on
                the
                instructions from time to time of the Majority Banks, and subject
                to
                Clauses 9.4 and 9.19, to execute the Security Documents on its behalf
                and
                to exercise all 

            

    

     

    

    
      
        
          
          

        

        
          40

          
            

          

        

        
          
          

        

      

    

    

    rights,
      powers, discretions and remedies vested in the Banks under or pursuant to the
      Security Documents, together with all powers reasonably incidental to them.
      

     

    
      	 	
              9.2

            	
              Authority
                Each
                of the Finance Parties irrevocably authorises the Agent, acting on
                the
                instructions from time to time of the Majority Banks (save where
                the terms
                of any Security Document expressly require the instructions of all
                of the
                Banks):- 

            

    

     

    
      	 	
              9.2.1

            	
              to
                give or withhold any consents or approvals; and

            

    

     

    
      	 	
              9.2.2

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

            

    

     

    
      	 	
              9.2.3

            	
              to
                collect, receive, release or pay any
                money;

            

    

     

    under
      or
      pursuant to any of the Security Documents. The Agent shall have no duties or
      responsibilities as agent or as security trustee other than those expressly
      conferred on it by the Security Documents and shall not be obliged to act on
      any
      instructions if to do so would, in the opinion of the Agent, be contrary to
      any
      provision of the Security Documents or to any law, or would expose the Agent
      to
      any actual or potential liability to any third party.

     

    
      	 	
              9.3

            	
              Trust
                The
                Agent agrees and declares, and each of the Banks acknowledges, that,
                subject to the terms and conditions of this Clause, the Agent holds
                the
                Trust Property on trust for the Banks, in accordance with their respective
                Proportionate Shares. Each of the Finance Parties agrees that the
                obligations, rights and benefits vested in the Agent in its capacity
                as
                security trustee shall be performed and exercised in accordance with
                this
                Clause. The Agent in its capacity as security trustee shall have
                the
                benefit of all of the provisions of this Agreement benefiting it
                in its
                capacity as agent for the Finance Parties, and all the powers and
                discretions conferred on trustees by the Trustee Act 1925 (to the
                extent
                not inconsistent with this Agreement). In
                addition:-

            

    

     

    
      	 	
              9.3.1

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

            

    

     

    

    
      
        
          
          

        

        
          41

          
            

          

        

        
          
          

        

      

    

    

    respect
      of anything else done or omitted to be done in any way relating to the Security
      Documents other than as a result of its gross negligence or wilful misconduct;
      and

     

    
      	 	
              9.3.2

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

            

    

     

    
      	 	
              9.3.3

            	
              the
                Agent and the Finance Parties agree that the perpetuity period applicable
                to the trusts declared by this Agreement shall be the period of eighty
                years from the Execution Date.

            

    

     

    9.4 Limitations
      on authority Except
      with the prior written consent of each of the Banks, the Agent shall not be
      entitled to :-

     

    
      	 	
              9.4.1

            	
              release
                or vary any security given for the Borrower's obligations under this
                Agreement; nor

            

    

     

    
      	 	
              9.4.2

            	
              agree
                to waive the payment of any sum of money payable by any of the Security
                Parties under the Security Documents;
                nor

            

    

     

    
      	 	
              9.4.3

            	
              change
                the meaning of the expression "Majority
                Banks";
                nor

            

    

     

    
      	 	
              9.4.4

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

            

    

     

    
      	 	
              9.4.5

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

            

    

     

    
      	 	
              9.4.6

            	
              take
                or refrain from taking any step if the effect of such action or inaction
                may lead to the increase of the obligations of a Bank under any of
                the
                Security Documents; nor

            

    

     

    
      	 	
              9.4.7

            	
              agree
                to change the currency in which any sum is payable under the Security
                Documents; nor

            

    

     

    

    
      
        
          
          

        

        
          42

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              9.4.8

            	
              agree
                to amend this Clause 9.4; nor

            

    

     

    
      	 	
              9.4.9

            	
              agree
                to reduce the rate under the definitions of "Margin"
                "Commitment
                Commission"
                or "Default
                Rate".

            

    

     

    
      	 	
              9.5

            	
              Liability
                Neither
                the Agent nor any of its directors, officers, employees or agents
                shall be
                liable to any of the other Finance Parties for anything done or omitted
                to
                be done by the Agent under or in connection with the Security Documents
                unless as a result of the Agent's wilful misconduct or gross
                negligence.

            

    

     

    
      	 	
              9.6

            	
              Acknowledgement
                Each
                of the Finance Parties (other than the Agent) acknowledges that:-
                

            

    

     

    
      	 	
              9.6.1

            	
              it
                has not relied on any representation made by the Agent or any of
                the
                Agent's directors, officers, employees or agents or by any other
                person
                acting or purporting to act on behalf of the Agent to induce it to
                enter
                into any of the Security Documents;

            

    

     

    
      	 	
              9.6.2

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

            

    

     

    
      	 	
              9.6.3

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

            

    

     

    
      	 	
              9.6.4

            	
              the
                Agent shall not have any duty or responsibility at any time to provide
                it
                with any credit or other information relating to any of the Security
                Parties unless that information is received by the Agent pursuant
                to the
                express terms of the Security Documents.

            

    

     

    Each
      of
      the Finance Parties (other than the Agent) agrees that it will not assert nor
      seek to assert against any director, officer, employee or agent of the Agent
      or
      against any other person acting or purporting to act on behalf of the Agent
      any
      claim which it might have against them in respect of any of the matters referred
      to in this Clause.

     

    

    
      
        
          
          

        

        
          43

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              9.7

            	
              Limitations
                on responsibility The
                Agent shall have no responsibility to any of the Security Parties
                or to
                any of the other Finance Parties on account of:-
                

            

    

     

    
      	 	
              9.7.1

            	
              the
                failure of any of the Finance Parties or of any of the Security Parties
                to
                perform any of their respective obligations under the Security Documents;
                

            

    

     

    
      	 	
              9.7.2

            	
              the
                financial condition of any of the Security Parties;
                

            

    

     

    
      	 	
              9.7.3

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

            

    

     

    
      	 	
              9.7.4

            	
              the
                negotiation, execution, effectiveness, genuineness, validity,
                enforceability, admissibility in evidence or sufficiency of any of
                the
                Security Documents or of any document executed or delivered pursuant
                to or
                in connection with any of the Security
                Documents.

            

    

     

    9.8 The
      Agent's rights The
      Agent
      may:-

     

    
      	 	
              9.8.1

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

            

    

     

    
      	 	
              9.8.2

            	
              assume
                that no Event of Default or Potential Event of Default has occurred
                unless, in its capacity as the Agent, it has acquired actual knowledge
                to
                the contrary; and 

            

    

     

    
      	 	
              9.8.3

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

            

    

     

    
      	 	
              9.8.4

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

            

    

     

    

    
      
        
          
          

        

        
          44

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              9.8.5

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

            

    

     

    
      	 	
              9.8.6

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

            

    

     

    
      	 	
              9.9

            	
              The
                Agent's duties The
                Agent shall:-

            

    

     

    
      	 	
              9.9.1

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

            

    

     

    
      	 	
              9.9.2

            	
              inform
                the Banks promptly of any Event of Default of which the Agent has
                actual
                knowledge.

            

    

     

    
      	 	
              9.10

            	
              No
                deemed knowledge The
                Agent shall not be deemed to have actual knowledge of the falsehood
                or
                incompleteness of any representation or warranty made or deemed repeated
                by any of the Security Parties or actual knowledge of the occurrence
                of
                any Event of Default or Potential Event of Default unless a Bank
                or any of
                the Security Parties shall have given written notice thereof to the
                Agent.

            

    

     

    
      	 	
              9.11

            	
              Other
                business The
                Agent may, without any liability to account to the Banks, generally
                engage
                in any kind of banking or trust business with any of the Security
                Parties
                or any of their respective Subsidiaries or associated companies or
                with a
                Bank as if it were not the Agent.

            

    

     

    
      	 	
              9.12

            	
              Agent's
                Indemnity The
                Banks shall, promptly on the Agent's request, reimburse the Agent
                in their
                respective Proportionate Shares, for, and keep the Agent fully indemnified
                in respect of:- 

            

    

     

    

    
      
        
          
          

        

        
          45

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              9.12.1

            	
              all
                amounts payable by the Borrower to the Agent pursuant to Clause 17
                (other
                than under Clauses 17.3 and 17.4) to the extent that those amounts
                are not
                paid by the Borrower; 

            

    

     

    
      	 	
              9.12.2

            	
              all
                liabilities, damages, costs and claims sustained or incurred by the
                Agent
                in connection with the Security Documents, or the performance of
                its
                duties and obligations, or the exercise of its rights, powers, discretions
                or remedies under or pursuant to any of the Security Documents; or
                in
                connection with any action taken or omitted by the Agent under or
                pursuant
                to any of the Security Documents, unless in any case those liabilities,
                damages, costs or claims arise solely from the Agent's wilful misconduct
                or gross negligence.

            

    

     

    
      	 	
              9.13

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

            

    

     

    
      	 	
              9.14

            	
              Distribution
                of payments The
                Agent shall pay promptly to the order of each of the Banks that Bank's
                Proportionate Share of every sum of money received by the Agent pursuant
                to the Security Documents (with the exception of any amounts payable
                pursuant to Clause 7 and any amounts which, by the terms of the Security
                Documents, are paid to the Agent for the account of the Agent alone
                or
                specifically for the account of one or more of the Finance Parties)
                and
                until so paid such amount shall be held by the Agent on trust absolutely
                for that Finance Party.

            

    

     

    
      	 	
              9.15

            	
              Reimbursement
                The
                Agent shall have no liability to pay any sum to another Party until
                it has
                itself received payment of that sum. If, however, the Agent does
                pay any
                sum to a Party on account of any amount prospectively due to it pursuant
                to Clause 9.14 or otherwise before it has itself received payment of
                that amount, and the Agent does not in fact receive payment within
                five
                Business Days after 

            

    

     

    

    
      
        
          
          

        

        
          46

          
            

          

        

        
          
          

        

      

    

    

    the
      date
      on which that payment was required to be made by the terms of the Security
      Documents, the recipient will, on demand by the Agent, refund to the Agent
      an
      amount equal to the amount received by it, together with an amount sufficient
      to
      reimburse the Agent for the cost of money for funding the amount in question
      during the period beginning on the date on which that amount was required to
      be
      paid by the terms of the Security Documents and ending on the date on which
      the
      Agent receives reimbursement.

     

    
      	 	
              9.16

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

            

    

     

    
      	 	
              9.16.1

            	
              that
                Finance Party shall promptly notify the Agent (which shall promptly
                notify
                each other Finance Party);

            

    

     

    
      	 	
              9.16.2

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

            

    

     

    
      	 	
              9.16.3

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

            

    

     

    However,
      if a Finance Party has commenced any Proceedings to recover sums owing to it
      under the Security Documents and, as a result of, or in connection with, those
      Proceedings has received an Excess Amount, the Agent shall not distribute any
      of
      that Excess Amount to any other Finance Party which had been notified of the
      Proceedings and had the legal right to, but did not, join those Proceedings
      or
      commence and diligently prosecute separate Proceedings to enforce its rights
      in
      the same or another court.

     

    

    
      
        
          
          

        

        
          47

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              9.17

            	
              Rescission
                of Excess Amount If
                all or any part of any Excess Amount is rescinded or must otherwise
                be
                restored to any of the Security Parties or to any other third party,
                the
                Finance Parties which have received any part of that Excess Amount
                by way
                of distribution from the Agent pursuant to Clause 9.16 shall repay
                to the
                Agent for the account of the Finance Party which originally received
                or
                recovered the Excess Amount, the amount which shall be necessary
                to ensure
                that all of the Banks share rateably in accordance with their
                Proportionate Shares together with interest on that amount at a rate
                equivalent to that (if any) paid by the Finance Party receiving or
                recovering the Excess Amount to the person to whom that Finance Party
                is
                liable to make payment in respect of such amount, and Clause 9.16.3
                shall
                apply only to the retained amount.

            

    

     

    
      	 	
              9.18

            	
              Proceedings
                Each
                of the Finance Parties shall notify one another of the proposed
                commencement of any Proceedings under any of the Security Documents
                prior
                to their commencement. No such Proceedings may be commenced without
                the
                prior written consent of the Majority
                Banks.

            

    

     

    
      	 	
              9.19

            	
              Instructions
                Where
                the Agent is authorised or directed to act or refrain from acting
                in
                accordance with the instructions of the Banks, or of the Majority
                Banks
                where applicable, each of the Banks shall provide the Agent with
                instructions within five (5) Business Days of the Agent's written
                request
                or such shorter period as the Agent may reasonably specify. If a
                Bank does
                not provide the Agent with instructions within that period, (i) that
                Bank
                shall be bound by the decision of the Agent, (ii) that Bank shall
                have no
                vote for the purposes of this Clause and (iii) the combined Proportionate
                Shares of the other Banks who provided such instructions shall be
                deemed
                to contribute 100%. Nothing in this Clause shall limit the right
                of the
                Agent to take, or refrain from taking, any action without obtaining
                the
                instructions of the Banks if the Agent in its discretion considers
                it
                necessary or appropriate to take, or refrain from taking, such action
                in
                order to preserve the rights of the Banks under or in connection
                with the
                Security Documents. In that event, the Agent will notify the Banks
                of the
                action taken by it as soon as reasonably practicable, and the Banks
                agree
                to ratify any action taken by the Agent pursuant to this
                Clause.

            

    

     

    
      	 	
              9.20

            	
              Communications
                Any
                Communication under this Clause shall be given, delivered, made or
                served,
                in the case of the Agent (in its capacity as Agent, or as
                

            

    

     

    

    
      
        
          
          

        

        
          48

          
            

          

        

        
          
          

        

      

    

    

    one
      of
      the Banks), and in the case of the other Finance Parties, at the address
      indicated in Schedule 1 or such other addresses as shall be duly notified in
      writing to the Agent on behalf of the Banks.

     

    
      	 	
              9.21

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

            

    

     

    
      	 	
              9.22

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

            

    

     

    
      	 	
              9.22.1

            	
              with
                the consent of the Borrower, not to be unreasonably withheld, the
                other
                Finance Parties may within thirty days after the date of the Agent's
                notice appoint a successor to act as agent and/or security trustee
                or, if
                they fail to do so with the consent of the Borrower, not to be
                unreasonably withheld, the Agent may appoint any other bank or financial
                institution as its successor;

            

    

     

    
      	 	
              9.22.2

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

            

    

     

    
      	 	
              9.22.3

            	
              the
                Agent shall thereupon be discharged from all further obligations
                as agent
                and/or security trustee but shall remain entitled to the benefit
                of the
                provisions of this Clause; 

            

    

     

    
      	 	
              9.22.4

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

            

    

     

    
      	 	
              9.23

            	
              No
                fiduciary relationship Except
                as provided in Clauses 9.3 and 9.14, the Agent shall not have any
                fiduciary relationship with or be deemed to be a trustee of or for
                any
                other Finance Party and nothing contained in any of the Security
                Documents
                shall constitute a partnership between any two or more Banks or between
                the Agent and any other Finance
                Party.

            

    

     

    

    
      
        
          
          

        

        
          49

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              9.24

            	
              The
                Agent as a Bank The
                expression "the
                Banks"
                when used in the Security Documents includes the Agent in its capacity
                as
                one of the Banks. The Agent shall be entitled to exercise its rights,
                powers, discretions and remedies under or pursuant to the Security
                Documents in its capacity as one of the Banks in the same manner
                as any
                other Bank and as if it were not also the
                Agent.

            

    

     

    
      	 	
              9.25

            	
              The
                Agent as security trustee
                Unless the context otherwise requires, the expression "the
                Agent"
                when used in the Security Documents includes the Agent acting in
                its
                capacities both as agent and security
                trustee.

            

    

     

    
      	10  	
              Covenants

            

    

     

    The
      Borrower covenants with the Finance Parties in the following terms.

     

    
      	 	
              10.1

            	
              Negative
                covenants 

            

    

     

    The
      Borrower will not:-

     

    10.1.1 no
      third party rights without
      the Majority Banks' prior written consent, create or permit to arise or continue
      any Encumbrance on or over all or any part of the Vessels or their respective
      Insurances except for Permitted Liens; nor

     

    10.1.2 no
      other business
      materially change the nature of their business from that of acting as a holding
      company as carried on as at the Execution Date and shall procure that there
      is
      no material change in the nature of the business of the Group as a whole from
      that advised to the Agent of the date of this Agreement; nor

     

    10.1.3 merger
      or amalgamation
      without
      the prior written consent of the Majority Banks, permit any merger or
      amalgamation; nor

     

    10.1.4 no
      change in management
      permit
      anyone other than the Manager to be appointed as commercial or technical
      managers of the Vessels, nor permit any material variation of the arrangements
      for the commercial or technical management of the Vessels, nor permit the
      Manager to sub-contract or delegate a material part of the commercial or
      technical management of any Vessel to any third party.

     

    

    
      
        
          
          

        

        
          50

          
            

          

        

        
          
          

        

      

    

    

    10.2 Positive
      covenants

     

    
      	 	
              10.2.1

            	
              Financial
                statements The
                Borrower shall procure that the Guarantor shall supply to the Agent
                

            

    

     

    
      	 	
              (a)

            	
              as
                soon as the same become available, but in any event within one hundred
                and
                fifty (150) days after the end of each of its financial years, its
                audited
                consolidated financial statements for that financial
                year;

            

    

     

    
      	 	
              (b)

            	
              as
                soon as the same become available, but in any event within sixty
                (60) days
                of the end of its second quarter in each of its financial years,
                unaudited
                consolidated financial statements for that half
                year;

            

    

     

    
      	 	
              (c)

            	
              as
                soon as they become available, but in any event within one hundred
                and
                fifty (150) days after the end of each of its financial years,
                consolidated financial forecasts for the following two financial
                years.

            

    

     

    
      	 	
              10.2.2

            	
              Requirements
                as to financial statements Each
                set of financial statements delivered by the Guarantor under Clause
                10.2.1:

            

    

     

    
      	 	
              (a)

            	
              shall
                be certified by an officer of the Guarantor to the best of its knowledge
                and belief as fairly representing its financial condition as at the
                date
                as at which those financial statements were drawn up;
                and

            

    

     

    
      	 	
              (b)

            	
              shall
                be prepared using GAAP, accounting practices and financial reference
                periods consistently applied unless, in relation to any set of financial
                statements, the Guarantor notifies the Agent that there has been
                a change
                in GAAP, the accounting practices or reference periods and the Guarantor's
                auditors deliver to the Agent:

            

    

     

    
      	 	
              (i)

            	
              a
                description of any change necessary for those financial statements
                to
                reflect the GAAP, accounting practices and reference periods upon
                which
                the previous financial statements were prepared;
                and

            

    

     

    

    
      
        
          
          

        

        
          51

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              (ii)

            	
              sufficient
                information, in form and substance as may be reasonably required
                by the
                Agent, to enable the Agent to make an accurate comparison between
                the
                financial position indicated in those financial statements and that
                indicated in the previous financial statements.

            

    

     

    
      	 	
              10.2.3

            	
              Information:
                miscellaneous The
                Borrower shall supply to the Agent:

            

    

     

    
      	 	
              (a)

            	
              all
                documents dispatched by the Borrower to its creditors generally at
                the
                same time as they are dispatched;

            

    

     

    
      	 	
              (b)

            	
              promptly
                upon becoming aware of them, details of any litigation, arbitration
                or
                administrative proceedings which are current, threatened or pending
                against any Security Party, and which might, if adversely determined,
                have
                a Material Adverse Effect on the ability of a Security Party to perform
                its obligations under the Security Documents or on the validity or
                enforceability of any of the Security Documents; and
                

            

    

     

    
      	 	
              (c)

            	
              promptly,
                such further information regarding the financial condition, business
                and
                operations of any Security Party as the Agent may reasonably request
                including, without limitation, cash flow analyses and details of
                the
                operating costs of each Vessel.

            

    

     

    
      	 	
              10.2.4

            	
              Notification
                of default 

            

    

     

    
      	 	
              (a)

            	
              The
                Borrower shall notify the Agent of any Default (and the steps, if
                any,
                being taken to remedy it) promptly upon becoming aware of its
                occurrence.

            

    

     

    
      	 	
              (b)

            	
              Promptly
                upon a request by the Agent, the Borrower shall supply to the Agent
                a
                certificate signed by two of its directors or senior officers on
                its
                behalf certifying to the best of their knowledge and belief that
                no
                Default is continuing (or if a Default is continuing, specifying
                the
                Default and the steps, if any, being taken to remedy
                it).

            

    

     

    

    
      
        
          
          

        

        
          52

          
            

          

        

        
          
          

        

      

    

    

    10.2.5 "Know
      your customer" checks If:

     

    
      	 	
              (a)

            	
              the
                introduction of or any change in (or in the interpretation, administration
                or application of) any law or regulation made after the date of this
                Agreement;

            

    

     

    
      	 	
              (b)

            	
              any
                change in the status of the Borrower after the date of this Agreement;
                or

            

    

     

    
      	 	
              (c)

            	
              a
                proposed assignment or transfer by a Bank of any of its rights and
                obligations under this Agreement to a party that is not a Bank prior
                to
                such assignment or transfer,

            

    

     

    obliges
      the Agent or any Bank (or, in the case of (c) above, any prospective new Bank)
      to comply with "know your customer" or similar identification procedures in
      circumstances where the necessary information is not already available to it,
      the Borrower shall promptly upon the request of the Agent or any Bank supply,
      or
      procure the supply of, such documentation and other evidence as is reasonably
      requested by the Agent (for itself or on behalf of any Bank) or any Bank for
      itself (or, in the case of (c) above, on behalf of any prospective new Bank)
      in
      order for the Agent or that Bank (or, in the case of (c) above, any prospective
      new Bank) to carry out and be satisfied it has complied with all necessary
      "know
      your customer" or other similar checks under all applicable laws and regulations
      pursuant to the transactions contemplated in the Security
      Documents.

     

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

     

    10.2.7 Corporate
      Existence
      The
      Borrower shall ensure that throughout the Facility Period each of the Security
      Parties shall (i) remain duly formed and validly existing under the laws of
      its
      respective jurisdiction of incorporation (ii) remain authorised to do business
      in the jurisdiction in 

     

    

    
      
        
          
          

        

        
          53

          
            

          

        

        
          
          

        

      

    

    

    which
      it
      transacts its business (iii) continue to have the power to carry on its business
      as it is now being conducted and to enter into and perform its obligations
      under
      the Security Documents to which it is a party and (iv) continue to comply with
      all laws, statutory, regulatory and other requirements relative to its business
      which could reasonably be expected to have a Material Adverse Effect on its
      business, assets or operations, financial or otherwise.

     

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

     

    10.2.9 Registration
      of Vessels
      The
      Borrower undertakes to maintain the registration of the Vessels under the flag
      indicated in Schedule 2, or such other flag requested by the Borrower and is
      consented to by the Banks (such consent not to be unreasonably withheld), for
      the duration of the Facility Period. 

     

    10.2.10 Classification
      The
      Borrower shall ensure that each Vessel maintains the highest classification
      required for the purpose of the relevant trade of such Vessel which shall be
      with a Pre-Approved Classification Society or such other society as may be
      acceptable to the Agent, in each case, free from any overdue recommendations
      and
      conditions affecting the class of that Vessel.

     

    10.2.11 Compliance
      with Applicable Laws
      The
      Borrower shall comply with all applicable laws to which it may be
      subject.

     

    10.2.12 Inspection
      of records
      The
      Borrower will permit the inspection of its financial records and accounts on
      reasonable notice from time to time during business hours by the Agent or its
      nominee. 

     

    10.2.13 Valuations
      The
      Borrower will deliver to the Agent: 

     

    

    
      
        
          
          

        

        
          54

          
            

          

        

        
          
          

        

      

    

    

    (a) a
      Valuation of each of the Vessels on the due date for delivery of the six monthly
      Compliance Certificate (which shall be at the expense of the Borrower);
      and

     

    (b) on
      such
      other occasions as the Agent may reasonably request (which shall be at the
      expense of the Agent).

     

    10.2.14 Financial
      covenants
      Throughout the Facility Period the Borrower shall procure that the Guarantor
      shall:-

     

    (i) maintain
      a ratio of Total Shareholder Equity to Total Assets of at least thirty five
      per
      cent. (35%); and

     

    (ii) maintain
      a ratio of EBITDA to Interest Expense of no less than 2.25:1.00.

     

    
      	 	
              10.2.15

            	
              Compliance
                Certificates
                The Borrower will produce a Compliance Certificate with each set
                of
                audited consolidated annual accounts and each set of unaudited
                consolidated six monthly accounts.

            

    

     

    
      	 	
              10.2.16

            	
              Additional
                security If
                and so often as the aggregate of: 

            

    

     

    
      	 	
              (i)

            	
              the
                Valuations of the Vessels; and

            

    

     

    
      	 	
              (ii)

            	
              the
                value of any additional security acceptable to the Agent in its absolute
                discretion for the time being provided to the Banks (or to the Agent
                on
                their behalf) pursuant to this Clause (the "Collateral")

            

    

     

    shall
      be
      less than one hundred and forty per cent (140%) of the amount of the Base
      Currency Amount (each being a "Relevant
      Percentage")
      the
      Borrower will, within thirty days of the request of the Agent to do so, at
      the
      Borrower's option:- 

     

    
      	 	
              (a)

            	
              pay
                to the Agent or to its nominee a cash deposit in the amount of the
                shortfall to be secured in favour of the Banks (or of the Agent on
                their
                behalf) as additional security for the payment of the Indebtedness;
                or
                

            

    

     

    

    
      
        
          
          

        

        
          55

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              (b)

            	
              give
                to the Banks (or to the Agent on their behalf) other additional security
                as proposed by the Borrower in amount and form acceptable to the
                Banks in
                their reasonable discretion, acting in good faith; or
                

            

    

     

    
      	 	
              (c)

            	
              prepay
                the amount of the Indebtedness which will ensure that the Collateral
                is
                not less than the Relevant
                Percentage.

            

    

     

     

    Clauses 5.3,
      5.4, 5.5 and 5.6 shall apply, mutatis
      mutandis,
      to any
      prepayment made pursuant to this Clause and the value of any additional security
      provided pursuant to this Clause shall be determined by the Agent in its
      discretion after consultation with the Majority Banks. Where the Borrower has
      provided additional security pursuant to this Clause, the Borrower may obtain
      new Valuations (at the Borrower's expense) on a date falling not earlier than
      three (3) months after the date such additional security was provided. If the
      aggregate amount of the Collateral reflecting the new Valuations of the Vessels
      (the "New
      Security Amount")
      is
      greater than the Relevant Percentage then, provided no Event of Default has
      occurred and is continuing, the Agent shall release to the Borrower, upon the
      Borrower's written request and at the Borrower's expense, any part of the
      additional security as the Borrower shall select with the consent of the Agent
      (such consent not to be unreasonably withheld), such that after its release
      the
      New Security Amount will be at least equal to the Relevant
      Percentage.

     

    
      	11  	
              Earnings

            

    

     

    
      	 	
              11.1

            	
              Remittance
                of Earnings The
                Borrower shall procure that all Net Earnings and any Requisition
                Compensation are paid to the Earnings Account or to such other account(s)
                as the Agent shall from time to time specify by notice in writing
                to the
                Borrower to begin as of no later than 30 June 2006 or such later
                date as
                the Banks shall agree. 

            

    

     

    
      	 	
              11.2

            	
              Earnings
                Account The
                Borrower shall maintain the Earnings Account with the Agent for the
                duration of the Facility Period free of Encumbrances and rights of
                set off
                except for Permitted Liens and those Encumbrances and rights of set
                off
                created by or under the Security Documents.

            

    

     

    

    
      
        
          
          

        

        
          56

          
            

          

        

        
          
          

        

      

    

    

    

     

    
      	12  	
              Events Of Default

            

    

     

    
      	 	
              12.1

            	
              The
                Agent's rights If
                any of the events set out in Clause 12.2 occurs, the Agent may at
                its
                discretion (and, on the instructions of the Majority Banks,
                will):

            

    

     

    12.1.1 by
      notice
      to the Borrower declare the Banks to be under no further obligation to the
      Borrower under or pursuant to this Agreement and may (and, on the instructions
      of the Majority Banks, will) declare all or any part of the Indebtedness
      (including such unpaid interest as shall have accrued and any Break Costs
      incurred by the Finance Parties) to be immediately payable, whereupon the
      Indebtedness (or the part of the Indebtedness referred to in the Agent's notice)
      shall immediately become due and payable without any further demand or notice
      of
      any kind; and/or

     

    12.1.2 declare
      that any undrawn portion of the Facility shall be cancelled, whereupon the
      same
      shall be cancelled and the corresponding Commitment of each Bank shall be
      reduced to zero; and/or

     

    
      	 	
              12.1.3

            	
              exercise
                any rights and remedies in existence or arising under the Security
                Documents.

            

    

     

    
      	 	
              12.2

            	
              Events
                of Default The
                events referred to in Clause 12.1
                are:-

            

    

     

    
      	 	
              12.2.1

            	
              payment
                default if
                the Borrower defaults in the payment of any part of the Indebtedness
                when
                due PROVIDED
                ALWAYS
                that if the Borrower can demonstrate to the reasonable satisfaction
                of the
                Agent that it has given all necessary instructions to effect payment
                and
                the non-receipt thereof is attributable to an error in the banking
                system,
                such Event of Default shall only occur two (2) Business Days after
                such
                payment fell due; or

            

    

     

    
      	 	
              12.2.2

            	
              other
                default if
                any of the Security Parties fails to observe or perform any of the
                covenants, conditions, undertakings, agreements or obligations on
                its part
                contained in any of the Security Documents or shall in any other
                way be in
                breach of any of the Security Documents and such default (if in the
                reasonable opinion of the Majority Banks

            

    

     

    

    
      
        
          
          

        

        
          57

          
            

          

        

        
          
          

        

      

    

    

    capable
      of remedy) is not remedied within fifteen (15) Business Days after notice of
      the
      default has been given to the Borrower; or 

     

    
      	 	
              12.2.3

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

            

    

     

    
      	 	
              12.2.4

            	
              execution
                if
                a distress or execution or other process of a court or authority
                not
                   covered by insurance is levied on any of the property of any of
                the
                Security Parties before or after final judgment or by order of any
                competent court or authority for an amount in excess of one million
                Dollars ($1,000,000) or its equivalent in any other currency and
                is not
                satisfied or stayed (with a view to being contested in good faith)
                within
                fourteen days of levy or any other applicable cure period (if longer);
                or

            

    

     

    
      	 	
              12.2.5

            	
              insolvency
                events if
                any of the Security Parties:-

            

    

     

    
      	 	
              (a)

            	
              resolves
                to appoint, or applies for, or consents to the appointment of, a
                receiver,
                administrative receiver, trustee, administrator or liquidator of
                itself or
                of all or part of its assets; or

            

    

     

    
      	 	
              (b)

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

            

    

     

    
      	 	
              (c)

            	
              makes
                a general assignment for the benefit of creditors;
                or

            

    

     

    
      	 	
              (d)

            	
              ceases
                trading or threatens to cease trading;
                or

            

    

     

    
      	 	
              (e)

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

            

    

     

    
      	 	
              12.2.6

            	
              insolvency
                proceedings if
                any proceedings are commenced or threatened, or any order or judgment
                is
                given by any court, for the bankruptcy, liquidation, winding up,
                administration or re-organisation of any of the Security Parties
                or for
                the appointment of a receiver, 

            

    

     

    

    
      
        
          
          

        

        
          58

          
            

          

        

        
          
          

        

      

    

    

    administrative
      receiver, administrator, liquidator or trustee of any of the Security Parties
      or
      of all or any material part of the assets of any of the Security Parties or
      if
      any person appoints or purports to appoint such receiver, administrative
      receiver, administrator, liquidator or trustee which proceeding is not
      discharged within fifteen (15) days of its commencement; or

     

    
      	 	
              12.2.7

            	
              impossibility
                or illegality unless
                covered by Clause 15.7, if any event occurs which would, or would
                with the
                passage of time, render performance of any of the Security Documents
                impossible, unlawful or unenforceable by the Banks or the Agent;
                or

            

    

     

    
      	 	
              12.2.8

            	
              conditions
                subsequent if
                any of the conditions set out in Clause 3.3 is not satisfied within
                the
                time reasonably required by the Agent;
                or

            

    

     

    
      	 	
              12.2.9

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

            

    

     

    
      	 	
              12.2.10

            	
              curtailment
                of business if
                the business of any of the Security Parties is wholly or materially
                curtailed by any intervention by or under authority of any government,
                or
                if all or a substantial part of the undertaking, property or assets
                of any
                of the Security Parties is seized, nationalised, expropriated or
                compulsorily acquired by or under authority of any government or
                any
                Security Party disposes or threatens to dispose of a substantial
                part of
                its business or assets; or

            

    

     

    
      	 	
              12.2.11

            	
              acceleration
                of other indebtedness if
                any Financial Indebtedness of any of the Security Parties or any
                Material
                Subsidiary becomes due or capable of being declared due prior to
                its
                stated maturity by reason of default on the part of that Security
                Party or
                Material Subsidiary (as the 

            

    

     

    

    
      
        
          
          

        

        
          59

          
            

          

        

        
          
          

        

      

    

    

    case
      may
      be), or is not repaid or satisfied on the due date for its repayment or any
      such
      other loan, guarantee or indebtedness becomes enforceable save for amounts
      of
      less than one million Dollars ($1,000,000) in aggregate, or its equivalent
      in
      any other currency; or

     

    
      	 	
              12.2.12

            	
              reduction
                of capital if
                any of the Security Parties reduces its authorised or issued or subscribed
                capital except as part of a share buy-back, whilst solvent, by the
                Borrower; or

            

    

     

    
      	 	
              12.2.13

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

            

    

     

    
      	 	
              12.2.14

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

            

    

     

    
      	 	
              12.2.15

            	
              material
                adverse change etc. if
                any thing is done or permitted or omitted to be done by any of the
                Security Parties or any Material Subsidiary which in the reasonable
                opinion of the Majority Banks has a Material Adverse Effect or if
                there
                occurs (in the reasonable opinion of the Majority Banks) any material
                adverse change in the business, affairs or financial condition of
                any of
                the Security Parties or any Material Subsidiary from that pertaining
                at
                the date of this Agreement; or 

            

    

     

    
      	 	
              12.2.16

            	
              final
                judgements
                if
                any of the Security Parties fails to comply with any non appealable
                court
                order or fails to pay a final unappealable judgment against it which
                remains unsettled for fifteen (15) Business Days;
                or

            

    

     

    
      	 	
              12.2.17

            	
              loss
                of stock market listing
                if
                the Guarantor ceases to be listed on NASDAQ or another recognised
                stock
                exchange for more than fifteen (15) Business Days;
                or

            

    

     

    
      	 	
              12.2.18

            	
              similar
                event any
                event occurs which, under the laws of any jurisdiction, has a similar
                or
                analogous effect to any of those events mentioned in Clauses 12.2.4,
                12.2.5 and 12.2.6; or

            

    

     

    

    
      
        
          
          

        

        
          60

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              12.2.19

            	
              environmental
                matters

            

    

     

    
      	 	
              (a)

            	
              any
                Environmental Claim is pending or made against the Borrower or any
                of the
                Borrower's Environmental Affiliates or in connection with a Vessel,
                where
                such Environmental Claim has a Material Adverse Effect, where such
                Environmental Claim is not covered by the Insurances.
                

            

    

     

    
      	 	
              (b)

            	
              any
                actual Environmental Incident occurs in connection with a Vessel,
                where
                such Environmental Incident has a Material Adverse Effect, where
                such
                Environmental Claim is not covered by the Insurances; or
                

            

    

     

    
      	 	
              12.2.20

            	
              repudiation
                Any Security Party repudiates any Security Document to which it is
                a party
                or does or causes to be done any act or thing evidencing an intention
                to
                repudiate any such Security Documents;
                or

            

    

     

    
      	 	
              12.2.21

            	
              Change
                in ownership or control of the Borrower
                There is any change in the beneficial ownership or control of the
                Borrower
                from that advised to the Agent by the Borrower at the date of this
                Agreement.

            

    

     

    
      	13  	
              Set-Off
                and Lien

            

    

     

    
      	 	
              13.1

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

            

    

     

    
      	 	
              13.2

            	
              Lien
                If
                an Event of Default has occurred and is continuing, unremedied or
                unwaived, each Finance Party shall have a lien on and be entitled
                to
                retain and realise as additional security for the repayment of the
                Indebtedness any cheques, drafts, bills, notes or negotiable or
                non-negotiable instruments and any stocks,

            

    

     

    

    
      
        
          
          

        

        
          61

          
            

          

        

        
          
          

        

      

    

    

    shares
      or
      marketable or other securities and property of any kind of the Borrower (or
      of
      that Finance Party as agent or nominee of the Borrower) from time to time held
      by that Finance Party, whether for safe custody or otherwise.

     

    
      	 	
              13.3

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

            

    

     

    
      	 	
              13.4

            	
              Application
                Whilst
                an Event of Default is continuing unremedied or unwaived, the Borrower
                irrevocably authorises the Agent to apply all sums which the Agent
                may
                receive:-

            

    

     

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

     

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

     

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

     

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

     

    
      	14  	
              Assignment and
                Sub-Participation

            

    

     

    
      	 	
              14.1

            	
              Right
                to assign Each
                of the Banks may assign or transfer all or any of its rights under
                or
                pursuant to the Security Documents or assign or grant sub-participations
                in all or any part of its Commitment (i) to any other branch or affiliate
                of that Bank or to another Bank or (ii) with the prior written consent
                of
                the Agent and the Borrower (which shall not be unreasonably withheld
                and
                which shall be deemed given if no response shall be received within
                ten
                (10) Business Days of a request 

            

    

     

    

    
      
        
          
          

        

        
          62

          
            

          

        

        
          
          

        

      

    

    

    or
      at any
      time whilst an Event of Default is in existence) to any other bank or financial
      institution.

     

    
      	 	
              14.2

            	
              Borrower's
                co-operation The
                Borrower will co-operate fully and will procure that the other Security
                Parties co-operate fully with the Banks in connection with any assignment,
                transfer or sub-participation pursuant to Clause 14.1; will execute
                and
                procure the execution of such documents as the Banks may require
                in
                connection therewith; and irrevocably authorises each of the Finance
                Parties to disclose to any proposed assignee, transferee or
                sub-participant (whether before or after any assignment, transfer
                or
                sub-participation and whether or not any assignment, transfer or
                sub-participation shall take place) all information relating to the
                Security Parties, the Facility or the Security Documents which each
                such
                Finance Party may in its discretion consider necessary or desirable
                (subject to any duties of confidentiality applicable to the Banks
                generally). 

            

    

     

    
      	 	
              14.3

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

            

    

     

    
      	 	
              14.4

            	
              Transfer
                Certificates
                If
                any Bank wishes to transfer all or any of its Commitment as contemplated
                in Clause 14.1 then such transfer may be effected by the delivery
                to the
                Agent and the Banks of a duly completed and duly executed Transfer
                Certificate in which event, on the later of the Transfer Date specified
                in
                such Transfer Certificate and the fifth Business Day after the date
                of
                delivery of such Transfer Certificate to the
                Agent:

            

    

     

    14.4.1 to
      the
      extent that in such Transfer Certificate the Bank which is a party thereto
      seeks
      to transfer its Commitment in whole, the Borrower and such Bank shall be
      released from further obligations towards each other under this Agreement and
      their respective rights against each other shall be cancelled other than
      existing claims against such Bank for breach of this Agreement (such rights,
      benefits and obligations being referred to in this Clause 14.4 as "discharged
      rights and obligations");

     

    14.4.2 the
      Borrower and the Transferee which is a party thereto shall assume obligations
      towards each other and/or acquire rights against each other which differ from
      such discharged rights and obligations only insofar as 

     

    

    
      
        
          
          

        

        
          63

          
            

          

        

        
          
          

        

      

    

    

    the
      Borrower and such Transferee have assumed and/or acquired the same in place
      of
      the Borrower and such Bank; 

     

    14.4.3 the
      Finance Parties and the Transferee shall acquire the same rights and benefits
      and assume the same obligations between themselves as they would have acquired
      and assumed had such Transferee been an original party to this Agreement as
      a
      Bank with the rights, benefits and/or obligations acquired or assumed by it
      as a
      result of such transfer; and

     

    14.4.4 the
      Transferee shall pay to the Agent a transfer fee of three thousand Dollars
      ($3,000).

     

    
      	 	
              14.5

            	
              Power
                of Attorney In
                order to give effect to each Transfer Certificate, the Finance Parties
                (with the exception of the Banks) and the Borrower each hereby irrevocably
                and unconditionally appoint the Agent as its true and lawful attorney
                with
                full power to execute on their respective behalves each Transfer
                Certificate delivered to the Agent pursuant to Clause 14.4 without
                the
                Agent being under any obligation to take any further instructions
                from or
                give any prior notice to, any of the Finance Parties or, subject
                to the
                Borrower's rights under Clause 14.1, the Borrower before doing so
                and the
                Agent shall so execute each such Transfer Certificate on behalf of
                the
                other Finance Parties (with the exception of the Banks) and the Borrower
                immediately on its receipt of the same pursuant to Clause
                14.4.

            

    

     

    
      	 	
              14.6

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

            

    

     

    
      	15  	
              Payments,
                Mandatory Prepayment, Reserve Requirements and
                Illegality

            

    

     

    
      	 	
              15.1

            	
              Payments
                All
                amounts payable by the Borrower under or pursuant to any of the Security
                Documents shall be paid to such accounts at such banks as the Agent
                may
                from time to time direct to the Borrower and shall be paid in the
                relevant
                Optional Currency in same day funds. Payments shall be deemed to
                have been
                received by the Agent on the date on which the Agent receives
                authenticated advice of receipt, unless that advice is received by
                the
                Agent on a day other than a 

            

    

     

    

    
      
        
          
          

        

        
          64

          
            

          

        

        
          
          

        

      

    

    

    Business
      Day or at a time of day (whether on a Business Day or not) when the Agent in
      its
      reasonable discretion considers that it is impossible or impracticable for
      the
      Agent to utilise the amount received for value that same day, in which event
      the
      payment in question shall be deemed to have been received by the Agent on the
      Business Day next following the date of receipt of advice by the
      Agent.

     

    
      	 	
              15.2

            	
              No
                deductions or withholdings All
                payments (whether of principal or interest or otherwise) to be made
                by the
                Borrower pursuant to the Security Documents shall, subject only to
                Clause
                15.3, be made free and clear of and without deduction for or on account
                of
                any Taxes or other deductions, withholdings, restrictions, conditions
                or
                counterclaims of any nature, and the Borrower will not claim any
                equity in
                respect of any payment due from them to the Banks or to the Agent
                under or
                in relation to any of the Security
                Documents.

            

    

     

    
      	 	
              15.3

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

            

    

     

    
      	 	
              15.4

            	
              Evidence
                of deductions If
                at any time the Borrower is required by law to make any deduction
                or
                withholding from any payment to be made by it pursuant to any of
                the
                Security Documents, the Borrower will pay the amount required to
                be
                deducted or withheld to the relevant authority within the time allowed
                under the applicable law and will, no later than thirty days after
                making
                that payment, deliver to the Agent an original receipt issued by
                the
                relevant authority, or other evidence reasonably acceptable to the
                Agent,
                evidencing the payment to that authority of all amounts required
                to be
                deducted or withheld. If
                the Borrower makes any deduction or withholding from any payment
                under or
                pursuant to any of the Security Documents, and a Bank subsequently
                receives a refund or allowance 

            

    

     

    

    
      
        
          
          

        

        
          65

          
            

          

        

        
          
          

        

      

    

    

    from
      any
      tax authority which that Bank at its sole discretion identifies as being
      referable to that deduction or withholding, that Bank shall, as soon as
      reasonably practicable, pay to the Borrower an amount equal to the amount of
      the
      refund or allowance received, if and to the extent that it may do so without
      prejudicing its right to retain that refund or allowance and without putting
      itself in any worse financial position than that in which it would have been
      had
      the deduction or withholding not been required to have been made. Nothing in
      this Clause shall be interpreted as imposing any obligation on any Bank to
      apply
      for any refund or allowance nor as restricting in any way the manner in which
      any Bank organises its tax affairs, nor as imposing on any Bank any obligation
      to disclose to the Borrower any information regarding its tax affairs or tax
      computations. All costs and expenses incurred by any Bank in obtaining or
      seeking to obtain a refund or allowance from any tax authority pursuant to
      this
      Clause shall be for the Borrower's account.

     

    
      	 	
              15.5

            	
              Adjustment
                of due dates If
                any payment to be made under any of the Security Documents, other
                than a
                payment of interest on the Facility (to which Clause 6.5 applies),
                shall
                be due on a day which is not a Business Day, that payment shall be
                made on
                the next succeeding Business Day (unless the next succeeding Business
                Day
                falls in the next calendar month in which event the payment shall
                be made
                on the next preceding Business Day). Any such variation of time shall
                be
                taken into account in computing any interest in respect of that
                payment.

            

    

     

    
      	 	
              15.6

            	
              Change
                in law If,
                by reason of the introduction of any law, or any change in any law,
                or the
                interpretation or administration of any law, or in compliance with
                any
                request or requirement from any central bank or any fiscal, monetary
                or
                other authority:-

            

    

     

    
      	 	
              15.6.1

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

            

    

     

    
      	 	
              15.6.2

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

            

    

     

    
      	 	
              15.6.3

            	
              any
                reserve requirements shall be imposed, modified or deemed applicable
                against assets held by or deposits in or for the account of or
                

            

    

     

    

    
      
        
          
          

        

        
          66

          
            

          

        

        
          
          

        

      

    

    

    loans
      by
      any branch of any Finance Party or its direct or indirect holding company;
      or

     

    
      	 	
              15.6.4

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

            

    

     

    
      	 	
              15.6.5

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

            

    

     

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

     

    
      	 	
              15.7

            	
              Illegality
                and impracticality Notwithstanding
                anything contained in the Security Documents, the obligations of
                a Bank to
                advance or maintain its Commitment shall terminate in the event that
                a
                change in any law or in the interpretation of any law by any authority
                charged with its administration shall make it unlawful for that Bank
                to
                advance or maintain its Commitment. In such event the Bank affected
                shall
                notify the Agent and the Agent shall, by written notice to the Borrower,
                declare that Bank's obligations to be immediately terminated. If
                all or
                any part of the Facility shall have been advanced by the Banks to
                the
                Borrower the portion of the Indebtedness (including all accrued interest)
                advanced by the Bank so affected shall be prepaid within thirty days
                

            

    

     

    

    
      
        
          
          

        

        
          67

          
            

          

        

        
          
          

        

      

    

    

    from
      the
      date of such notice, or sooner if illegality is determined. Clause 5.4 shall
      apply to either of those prepayments if it is made on a day other than the
      last
      day of an Interest Period. During that period, the affected Bank shall negotiate
      in good faith with the Borrower to find an alternative method or lending base
      in
      order to maintain the Facility.

     

    
      	 	
              15.8

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

            

    

     

    
      	 	
              15.8.1

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

            

    

     

    
      	 	
              15.8.2

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

            

    

     

    
      	 	
              15.8.3

            	
              the
                Agent in accordance with instructions from that Bank and subject
                to that
                Bank's approval of any agreement between the Agent and the Borrower,
                will
                negotiate with the Borrower in good faith with a view to modifying
                this
                Agreement to provide a substitute basis for that Bank’s Commitment which
                is financially a substantial equivalent to the basis provided for
                in this
                Agreement. 

            

    

     

    If,
      within thirty days of the giving of the notice referred to in
      Clause 15.8.1, the Borrower and the Agent fail to agree in writing on a
      substitute basis for such Bank’s Commitment the Borrower will immediately prepay
      the amount of such Bank’s Commitment and the Maximum Facility Amount will
      automatically decrease by the amount of such Commitment and such decrease shall
      not be reversed. Clause 5.4 shall apply to that prepayment if it is made on
      a
      day other than the last day of an Interest Period.

     

    

    
      
        
          
          

        

        
          68

          
            

          

        

        
          
          

        

      

    

    

    

     

    
      	 	
              15.9

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

            

    

     

    
      	16  	
              Communications

            

    

     

    
      	 	
              16.1

            	
              Method
                Except for Communications pursuant to Clause 9, which shall be made
                or
                given in accordance with Clause 9.20, any Communication may be given,
                delivered, made or served (as the case may be) under or in relation
                to
                this Agreement by letter or fax and shall be in the English language
                and
                sent addressed:- 

            

    

     

    
      	 	
              16.1.1

            	
              in
                the case of any of the Finance Parties to the Agent at its address
                at the
                head of this Agreement (fax no: +47 5521 1924) marked for the attention
                of: Credit Administration; and 

            

    

     

    
      	 	
              16.1.2

            	
              in
                the case of the Borrower to the Communications
                Address;

            

    

     

    or
      to
      such other address or fax number as the Agent or the Borrower may designate
      for
      themselves by written notice to the others.

     

    

    
      
        
          
          

        

        
          69

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              16.2

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

            

    

     

    
      	 	
              16.2.1

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

            

    

     

    
      	 	
              16.2.2

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

            

    

     

    
      	 	
              16.2.3

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

            

    

     

    Any
      Communication by fax shall be promptly confirmed in writing by post or hand
      delivery.

     

    
      	17  	
              General
                Indemnities

            

    

     

    
      	 	
              17.1

            	
              Currency
                In
                the event of any Finance Party receiving or recovering any amount
                payable
                under any of the Security Documents in a currency other than the
                Currency
                of Account, and if the amount received or recovered is insufficient
                when
                converted into the Currency of Account at the date of receipt to
                satisfy
                in full the amount due, the Borrower shall, on the Agent's written
                demand,
                pay to the Agent such further amount in the Currency of Account as
                is
                sufficient to satisfy in full the amount due and that further amount
                shall
                be due to the Agent on behalf of the Finance Parties as a separate
                debt
                under this Agreement.

            

    

     

    
      	 	
              17.2

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

            

    

     

    
      	 	
              17.2.1

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

            

    

     

    

    
      
        
          
          

        

        
          70

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              17.2.2

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

            

    

     

    
      	 	
              17.2.3

            	
              any
                other documents which may at any time reasonably be required by any
                Finance Party to give effect to any of the Security Documents or
                which any
                Finance Party is entitled to call for or obtain pursuant to any of
                the
                Security Documents; and

            

    

     

    
      	 	
              17.2.4

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

            

    

     

    
      	 	
              17.3

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

            

    

     

    
      	 	
              17.4

            	
              Funding
                costs
                The Borrower shall indemnify the Finance Parties from time to time
                on
                demand against all losses and costs incurred or sustained by any
                Finance
                Party if, for any reason due to a default or other action by the
                Borrower,
                any Drawing is not advanced to the Borrower after the relevant Drawdown
                Notice has been given to the Agent, or is advanced on a date other
                than
                that requested in the Drawdown Notice, including (without limitation)
                any
                Break Costs.

            

    

     

    
      	 	
              17.5

            	
              Protection
                and enforcement The
                Borrower shall indemnify the Finance Parties from time to time on
                demand
                against all losses, costs and liabilities which any Finance Party
                may from
                time to time sustain, incur or become liable for in or about the
                protection, maintenance or enforcement of the rights conferred on
                the
                Finance Parties by the Security Documents or in or about the exercise
                or
                purported exercise by the Finance Parties of any of the rights, powers,
                discretions or remedies vested in them under or arising out of the
                Security Documents, including (without limitation) any losses, costs
                and
                liabilities which any Finance Party may from time to time sustain,
                incur
                or become liable for by reason of any Finance Party being mortgagees
                of
                any Vessel, assignees of any Mortgage and/or a lender to the Borrower,
                or
                by reason of any Finance Party being deemed by any court or authority
                to
                be an operator or controller, or in any way concerned in the operation
                or
                control, of any Vessel. No such indemnity will be given to a Finance
                Party
                where any such loss, cost or liability has occurred due to gross
                negligence 

            

    

     

    

    
      
        
          
          

        

        
          71

          
            

          

        

        
          
          

        

      

    

    

    or
      wilful
      misconduct on the part of that Finance Party; however this shall not affect
      the
      right of any other Finance Party to receive any such indemnity.

     

    
      	 	
              17.6

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

            

    

     

    
      	 	
              17.7

            	
              Taxes
                The
                Borrower shall pay all Taxes to which all or any part of the Indebtedness
                or any of the Security Documents may be at any time subject and shall
                indemnify the Finance Parties on demand against all liabilities,
                costs,
                claims and expenses incurred in connection therewith, including but
                not
                limited to any such liabilities, costs, claims and expenses resulting
                from
                any omission to pay or delay in paying any such Taxes. The indemnity
                contained in this Clause shall survive the repayment of the
                Indebtedness.

            

    

     

    
      	18  	
              Miscellaneous

            

    

     

    
      	 	
              18.1

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

            

    

     

    
      	 	
              18.2

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

            

    

     

    

    
      
        
          
          

        

        
          72

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              18.3

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

            

    

     

    
      	 	
              18.4

            	
              Successors
                etc. The
                Security Documents shall be binding on the Security Parties and on
                their
                successors and permitted transferees and assignees, and shall inure
                to the
                benefit of the Finance Parties and their respective successors,
                transferees and assignees. The Borrower may not assign or transfer
                any of
                its rights or duties under or pursuant to any of the Security Documents
                without the prior written consent of the
                Banks.

            

    

     

    
      	 	
              18.5

            	
              Further
                assurance If
                any provision of the Security Documents shall be invalid or unenforceable
                in whole or in part by reason of any present or future law or any
                decision
                of any court, or if the documents at any time held by the Finance
                Parties
                on their behalf are considered by the Banks for any reason insufficient
                to
                carry out the terms of this Agreement, then from time to time the
                Borrower
                will promptly, on demand by the Agent, execute or procure the execution
                of
                such further documents as in the reasonable opinion of the Banks
                are
                necessary to provide adequate security for the repayment of the
                Indebtedness.

            

    

     

    
      	 	
              18.6

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

            

    

     

    
      	 	
              18.7

            	
              Advisers
                The Borrower irrevocably authorises the Agent, at any time and from
                time
                to time during the Facility Period, to consult insurance advisers
                on any
                matters relating to the Insurances, and from time to time to consult
                or
                retain advisers or consultants to monitor or advise on any other
                claims
                relating to the Vessels. The Borrower will provide such advisers
                and
                consultants with all information and documents which they may from
                time to
                time reasonably require 

            

    

     

    

    
      
        
          
          

        

        
          73

          
            

          

        

        
          
          

        

      

    

    

    and
      will
      reimburse the Agent on demand for all reasonable costs and expenses incurred
      by
      the Agent in connection with the consultation or retention of such advisers
      or
      consultants.

     

    
      	 	
              18.8

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

            

    

     

    
      	 	
              18.9

            	
              Rights
                etc. cumulative Every
                right, power, discretion and remedy conferred on the Finance Parties
                under
                or pursuant to the Security Documents shall be cumulative and in
                addition
                to every other right, power, discretion or remedy to which they may
                at any
                time be entitled by law or in equity. The Finance Parties may exercise
                each of their rights, powers, discretions and remedies as often and
                in
                such order as they deem appropriate subject to obtaining the prior
                written
                consent of the Majority Banks. The exercise or the beginning of the
                exercise of any right, power, discretion or remedy shall not be
                interpreted as a waiver of the right to exercise any other right,
                power,
                discretion or remedy either simultaneously or
                subsequently.

            

    

     

    
      	 	
              18.10

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

            

    

     

    
      	 	
              18.11

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

            

    

     

    
      	 	
              18.12

            	
              Security
                cumulative The
                security constituted by the Security Documents shall be in addition
                to any
                other security now or in the future held by the Finance Parties or
                any of
                them for or in respect of all or any part of the Indebtedness, and
                

            

    

     

    

    
      
        
          
          

        

        
          74

          
            

          

        

        
          
          

        

      

    

    

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

     

    
      	 	
              18.13

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

            

    

     

    
      	 	
              18.14

            	
              No
                liability None
                of the Finance Parties, nor any agent or employee of any Finance
                Party,
                nor any receiver and/or manager appointed by the Agent, shall be
                liable
                for any losses which may be incurred in or about the exercise of
                any of
                the rights, powers, discretions or remedies of the Finance Parties
                under
                or pursuant to the Security Documents nor liable as mortgagee in
                possession for any loss on realisation or for any neglect or default
                of
                any nature for which a mortgagee in possession might otherwise be
                liable
                unless such Finance Party’s action constitutes gross negligence or wilful
                misconduct.

            

    

     

    
      	 	
              18.15

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

            

    

     

    
      	 	
              18.16

            	
              Subsequent
                Encumbrances If
                the Agent receives notice of any subsequent Encumbrance (other than
                any
                Encumbrance permitted by the terms of this Agreement) affecting any
                Vessel
                or all or any part of the Insurances or Requisition Compensation,
                the
                Agent may open a new account in its books for the Borrower. If the
                Agent
                does not open a new account, then (unless the Encumbrance is permitted
                by
                the terms of this Agreement or the Agent gives written notice to
                the
                contrary to the Borrower) as from the time of receipt by the
                

            

    

     

    

    
      
        
          
          

        

        
          75

          
            

          

        

        
          
          

        

      

    

    

    Agent
      of
      notice of such subsequent Encumbrance, all payments made to the Agent shall
      be
      treated as having been credited to a new account of the Borrower and not as
      having been applied in reduction of the Indebtedness.

     

    
      	 	
              18.17

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

            

    

     

    
      	 	
              18.18

            	
              Certificates
                Any
                certificate or statement signed by an authorised signatory of the
                Agent
                purporting to show the amount of the Indebtedness (or any part of
                the
                Indebtedness) or any other amount referred to in any of the Security
                Documents shall, save for manifest error or on any question of law,
                be
                conclusive evidence as against the Borrower of that amount.
                

            

    

     

    
      	 	
              18.19

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

            

    

     

    
      	 	
              18.20

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

            

    

     

    
      	 	
              18.21

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

            

    

     

    
      	19  	
              Law and Jurisdiction

            

    

     

    
      	 	
              19.1

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

            

    

     

    
      	 	
              19.2

            	
              Jurisdiction
                For
                the exclusive benefit of the Finance Parties, the parties to this
                Agreement irrevocably agree that the courts of England are to have
                jurisdiction to settle any disputes which may arise out of or in
                connection with this Agreement and that any Proceedings may be brought
                in
                those courts. The Borrower irrevocably waives any objection which
                it may
                now or in the future have to the 

            

    

     

    

    
      
        
          
          

        

        
          76

          
            

          

        

        
          
          

        

      

    

    

    laying
      of
      the venue of any Proceedings in any court referred to in this Clause, and any
      claim that those Proceedings have been brought in an inconvenient or
      inappropriate forum.

     

    
      	 	
              19.3

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

            

    

     

    
      	 	
              19.4

            	
              Service
                of process Without
                prejudice to the right of the Finance Parties to use any other method
                of
                service permitted by law, the Borrower irrevocably agrees that any
                writ,
                notice, judgment or other legal process shall be sufficiently served
                on it
                if addressed to it and left at or sent by post to the Address for
                Service,
                and in that event shall be conclusively deemed to have been served
                at the
                time of leaving or, if posted, at 9.00 a.m. on the third Business
                Day
                after posting by prepaid first class registered
                post.

            

    

     

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

     

    

    
      
        
          
          

        

        
          77

          
            

          

        

        
          
          

        

      

    

    

    SCHEDULE
      1

     

    The
      Banks, the Commitments and the Proportionate Shares

     

    

    
      	
              The
                Banks

            	
              The
                Commitments ($)

            	
              The
                Proportionate Shares (%)

            
	
              DnB
                NOR BANK ASA

            	
              $43,200,000

            	
              72%

            
	
              THE
                ROYAL BANK OF SCOTLAND PLC

            	
              $16,800,000

            	
              28%

               

            

    

    

    

    
      
        
          
          

        

        
          78

          
            

          

        

        
          
          

        

      

    

    

    SCHEDULE
      2

     

    The
      Vessels

     

    

    
      	
              Owner

               

            	
              Country
                of Incorporation

               

            	
              Vessel

               

            	
              Flag

               

            
	
              Gulf
                Offshore N.S. Limited

               

            	
              England
                and Wales

               

            	
              "HIGHLAND
                BUGLAR"

               

            	
              UK

               

            
	
              Gulf
                Offshore N.S. Limited

               

            	
              England
                and Wales

               

            	
              "HIGHLAND
                EAGLE"

               

            	
              UK

               

            
	
              Gulf
                Offshore N.S. Limited

               

            	
              England
                and Wales

               

            	
              "HIGHLAND
                MONARCH"

               

            	
              UK

               

            
	
              Gulf
                Offshore N.S. Limited

               

            	
              England
                and Wales

               

            	
              "HIGHLAND
                ENDURANCE"

               

            	
              UK

               

            
	
              Gulf
                Offshore N.S. Limited

               

            	
              England
                and Wales

               

            	
              "HIGHLAND
                COURAGE"

               

            	
              UK

               

            
	
              Gulf
                Offshore N.S. Limited

               

            	
              England
                and Wales

               

            	
              "HIGHLAND
                VALOUR"

               

            	
              UK

               

            

    

    

     

    

    
      
        
          
          

        

        
          79

          
            

          

        

        
          
          

        

      

    

    

    SCHEDULE
      3

     

    Form
      of Transfer Certificate

     

    To:
       DnB
      NOR
      Bank ASA as agent (the "Agent")

    The
      Royal
      Bank of Scotland plc (the "Bank")

    

    TRANSFER
      CERTIFICATE

    

    This
      transfer certificate relates to a facility agreement (as the same may be from
      time to time amended, varied, novated or supplemented, the "Facility
      Agreement")
      dated
                              
2006 whereby an initial reducing revolving credit facility of up to $30,000,000
      was made available to GulfMark Rederi AS by a group of banks on whose behalf
      the
      Agent acts as agent and security trustee.

    

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

            

    

    

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

            

    

    

    
      	3  	
              The
                Transferee requests the Agent and the Bank to accept this Transfer
                Certificate as being delivered to the Agent and the Bank pursuant
                to and
                for the purposes of clause 14.4 of the Facility Agreement so as to
                take
                effect in accordance with the terms thereof on the Transfer Date
                or on
                such later date as may be determined in accordance with the terms
                thereof.

            

    

    

    
      	4  	
              The
                Transferee confirms that it has received a copy of the Facility Agreement
                together with such other information as it has required in connection
                with
                this transaction and that it has not relied and will not in the future
                rely on the Existing Bank or any other party to the Facility Agreement
                to
                check or enquire on its behalf into the legality, validity,
                

            

    

    

    
      
        
          
          

        

        
          80

          
            

          

        

        
          
          

        

      

    

    

    effectiveness,
      adequacy, accuracy or completeness of any such information and further agrees
      that it has not relied and will not rely on the Existing Bank or any other
      party
      to the Facility Agreement to access or keep under review on its behalf the
      financial condition, creditworthiness, condition, affairs, status or nature
      of
      the Borrower or any other party to the Facility Agreement.

    

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

            

    

    

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

            

    

    

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

            

    

    

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

            

    

    

    
      
        
          
          

        

        
          81

          
            

          

        

        
          
          

        

      

    

    

    

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

            

    

    THE SCHEDULE

    

    
      	1  	
              Existing
                Bank:

            

    

    

    
      	2  	
              Transferee:

            

    

    

    
      	3  	
              Transfer
                Date:

            

    

    

    
      	4  	
              Existing
                Bank's Commitment1:Portion
                Transferred

            

    

    

    

    [Transferor
      Bank]    [Transferee
      Bank]

    

    By:      By:

    

    Date:      Date:

    

    DnB
      NOR Bank ASA

    

    As
      agent
      for and on behalf of itself,

    the
      Borrower and the other Finance Parties (with the exception of the
      Banks):-

    

    By:
      ..........................................

    

    Date:
      [    ]

    

    

    The
      Royal Bank of Scotland plc

    

    By:
      ..........................................

    

    Date:
      [    ]

    

    

    

    

    1
      Details
      of the Bank's Commitment should not be completed after the Termination
      Date.

    

    
      
        
          
          

        

        
          82

          
            

          

        

        
          
          

        

      

    

    

    SCHEDULE
      4

     

    Form
      of Drawdown Notice

     

    

    
      	
              To:

            	
              DnB
                NOR Bank ASA

            

    

    

    

    From: GULF
      OFFSHORE N.S. LIMITED

    

    [Date]

    

    Dear
      Sirs,

    Drawdown
      Notice

    

    We
      refer
      to the Revolving Credit Facility Agreement dated
                                    2006
      made between, amongst others, ourselves and yourselves ("the
      Agreement").

    

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

    

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

     

    We
      warrant that the representations and warranties contained in Clause 4 of the
      Agreement other than those in clause 4.9 [and clause 4.17]2 
      are true
      and correct at the date of this Drawdown Notice and will be true and correct
      on
             
200[ ]; that no Event of Default nor Potential Event of Default has
      occurred and is continuing, and that no Event of Default or Potential Event
      of
      Default will result from the advance of the Drawing requested in this Drawdown
      Notice. 

    

    [We
      further confirm and certify that no material adverse change has occurred since
      the Execution Date in the business, assets, operations, condition (financial
      or
      otherwise) or prospects of the Borrower or its subsidiaries or in the facts
      and
      information regarding such entities as represented to date3 ].

     

    2
      To be in
      subsequent Drawdown Notices only.

    3
      To be in
      first Drawdown Notice only.

    

    
      
        
          
          

        

        
          83

          
            

          

        

        
          
          

        

      

    

    

    

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

    

    Yours
      faithfully

    

    

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

    For
      and
      on behalf of

    GULF
      OFFSHORE N.S. LIMITED

     

    

    
      
        
          
          

        

        
          84

          
            

          

        

        
          
          

        

      

    

    

    SCHEDULE
      5

     

    Calculation
      of the Mandatory Cost

     

    
      	
              1

            	
              The
                Mandatory Cost is an addition to the interest rate to compensate
                the Banks
                for the cost of compliance with (a) the requirements of the Bank
                of
                England and/or the Financial Services Authority (or, in either case,
                any
                other authority which replaces all or any of its functions) or (b)
                the
                requirements of the European Central
                Bank.

            

    

     

    
      	
              2

            	
              On
                the first day of each Interest Period (or as soon as possible thereafter)
                the Agent shall calculate, as a percentage rate, a rate (the "Additional
                Cost Rate")
                for each Bank, in accordance with the paragraphs set out below. The
                Mandatory Cost will be calculated by the Agent as a weighted average
                of
                the Banks' Additional Cost Rates (weighted in proportion to the percentage
                participation of each Bank in the Loan) and will be expressed as
                a
                percentage rate per annum.

            

    

     

    
      	
              3

            	
              The
                Additional Cost Rate for any Bank lending from a Facility Office
                in a
                Participating Member State will be the percentage notified by that
                Bank to
                the Agent. This percentage will be certified by that Bank in its
                notice to
                the Agent to be its reasonable determination of the cost (expressed
                as a
                percentage of that Bank's participation in all loans made from that
                Facility Office) of complying with the minimum reserve requirements
                of the
                European Central Bank in respect of loans made from that Facility
                Office.

            

    

     

    
      	
              4

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

            

    

     

    
      per
        cent.
        per annum.
E
      x
      0.01

    300 

     

    
      	 	
              Where
                E is the rate of charge payable by a Bank to the Financial Services
                Authority under the Fees Rules in respect of the relevant financial
                year
                of the Financial Services Authority (calculated for this purpose
                by the
                Agent as being the average of the Fee Tariffs applicable to that
                Bank for
                that financial year).

            

    

     

    5 For
      the
      purposes of this Schedule:

     

    
      	 	
              (a)

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

            

    

     

    

    
      
        
          
          

        

        
          85

          
            

          

        

        
          
          

        

      

    

    

    
      	 	
              (b)

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

            

    

     

    
      	 	
              (c)

            	
              "Fee
                Rules"
                means the rules on periodic fees contained in the FSA Supervision
                Manual
                or such other law or regulation as may be in force from time to time
                in
                respect of the payment of fees for the acceptance of
                deposits;

            

    

     

    
      	 	
              (d)

            	
              "Fee
                Tariffs"
                means the fee tariffs specified in the Fees Rules under the activity
                group
                A.1 Deposit acceptors (ignoring any minimum fee or zero rated fee
                required
                pursuant to the Fee Rules but taking into account any applicable
                discount
                rate); and

            

    

     

    
      	 	
              (e)

            	
              "Participating
                Member State"
                means any member state of the European Communities that adopts or
                has
                adopted the euro as its lawful currency in accordance with legislation
                of
                the European Union relating to European Monetary
                Union;

            

    

     

    
      	 	
              (f)

            	
              "Parties"
                means any party to the Agreement, including its successors in title
                permitted assigns and permitted transferees;
                and

            

    

     

    
      	 	
              (g)

            	
              "Tariff
                Base"
                has the meaning given to it in, and will be calculated in accordance
                with,
                the Fees Rules.

            

    

     

    
      	
              6

            	
              If
                requested by the Agent, each Bank shall, as soon as practicable after
                publication by the Financial Services Authority, supply to the Agent,
                the
                rate of charge payable by that Bank to the Financial Services Authority
                pursuant to the Fees Rules in respect of the relevant financial year
                of
                the Financial Services Authority (calculated for this purpose by
                that Bank
                as being the average of the Fee Tariffs applicable to that Bank for
                that
                financial year).

            

    

     

    
      	
              7

            	
              Each
                Bank shall supply any information required by the Agent for the purpose
                of
                calculating its Additional Cost Rate. In particular, but without
                limitation, each Bank Shall supply the following information on or
                prior
                to the date on which it becomes a
                Bank:

            

    

     

    (a) the
      jurisdiction of its Facility Office; and

     

    (b) any
      other
      information that the Agent may reasonably require for such purpose.

     

    Each
      Bank
      shall promptly notify the Agent of any change to the information provided by
      it
      pursuant to this paragraph.

     

    

    
      
        
          
          

        

        
          86

          
            

          

        

        
          
          

        

      

    

    

    
      	
              8

            	
              The
                percentages of each Bank for the purpose of E above shall be determined
                by
                the Agent based upon the information supplied to it pursuant to paragraphs
                6 and 7 above and on the assumption that, unless the Bank notifies
                the
                Agent to the contrary, each Bank's obligations in relation to cash
                ratio
                deposits and Special Deposits are the same as those of a typical
                bank from
                its jurisdiction of incorporation with a Facility Office in the same
                jurisdiction as in its Facility
                Office.

            

    

     

    
      	
              9

            	
              The
                Agent shall have no liability to any person if such determination
                results
                in an Additional Cost Rate which over or under compensates any Bank
                and
                shall be entitled to assume that the information provided by any
                Bank
                pursuant to paragraphs 3, 6 and 7 above is true and correct in all
                respects.

            

    

     

    
      	
              10

            	
              The
                Agent shall distribute the additional amounts received as a result
                of the
                Mandatory Cost to the Banks on the basis of the Additional Cost Rate
                for
                each Bank based on the information provided by each Bank pursuant
                to
                paragraphs 3, 6 and 7 above.

            

    

     

    
      	
              11

            	
              Any
                determination by the Agent pursuant to this Schedule in relation
                to a
                formula, the Mandatory Cost, an Additional Cost Rate or any amount
                payable
                to a Bank shall, in the absence of manifest error, be conclusive
                and
                binding on all Parties.

            

    

     

    
      	
              12

            	
              The
                Agent may from time to time, after consultation with the Borrower
                and the
                Banks determine and notify to all Parties any amendments which are
                required to be made to this Schedule in order to comply with any
                change in
                law, regulation or any requirements from time to time imposed by
                the Bank
                of England, the Financial Services Authority or the European Central
                Bank
                (or, in any case, any other authority which replaces all or any of
                its
                functions) and any such determination shall, in the absence of manifest
                error, be conclusive and binding on all
                Parties.

            

    

     

    

    
      
        
          
          

        

        
          87

          
            

          

        

        
          
          

        

      

    

    

    SCHEDULE
      6

     

    Form
      of Compliance Certificate

     

    To: DnB
      NOR
      Bank ASA (the "Agent")

    From: Gulf
      Offshore N.S. Limited

    

    Date:
      [Ÿ]

    

    

    Dear
      Sirs,

     

    We
      refer
      to an agreement (the "Agreement")
      dated
      [                        ]
      2006 and made between (inter alia) (1) ourselves as borrower (2) the banks
      and
      financial institutions listed in Schedule 1 of the Agreement as banks and (3)
      the Agent as the agent and security trustee (as from time to time amended,
      varied, novated or supplemented).

     

    Terms
      defined or construed in the Agreement have the same meanings and constructions
      in this Certificate.

     

    We
      attach
      the relevant calculation details applicable on the last day of our financial
      [year][quarter] ending [Ÿ]
      (the
      "Relevant
      Period")
      which
      confirm that:-

     

    
      	
              1.

            	
              The
                Guarantor's Total Shareholder Equity is
                [          ], and the
                Guarantor's Total Assets are
                [          ]. As such
                the ratio of Total Shareholder Equity to Total Assets is
                [          ].

            

    

     

    
      	
              2.

            	
              The
                Guarantor's EBITDA is
                [          ] and the
                Guarantor's Interest Expense is
                [          ]. As such
                the Guarantor's ratio of EBITDA to Interest Expense is
                [          ].

            

    

     

    
      	
              3.

            	
              We
                attach Valuations for each of the Vessels showing an aggregate Valuation
                of [          ]. As such
                the
                aggregate of: 

            

    

     

    
      	 	
              (a)

            	
              the
                Valuations of the Vessels; and

            

    

     

    
      	 	
              (b)

            	
              the
                value of any additional security acceptable to the Agent in its absolute
                discretion for the time being provided to the Banks (or to the Agent
                on
                their behalf) pursuant to
                Clause 10.2.16,

            

    

     

    is
      [    ]% of the Maximum Facility Amount.

     

    

    
      
        
          
          

        

        
          88

          
            

          

        

        
          
          

        

      

    

    

    

     

    

    Signed:  ........................................

    Duly
      authorised representative of

    GULF
      OFFSHORE N.S. LIMITED

    

    

    
      
        
          
          

        

        
          89

          
            

          

        

        
          
          

        

      

    

    

    

      

      
        	
                SIGNED
                  by

                duly
                  authorised for and on behalf 

                of
                  DnB
                  NOR Bank ASA

                (as
                  Agent, MLA, Issuer and Bank)

                in
                  the presence of:- Ania Lipinski

              	
                )

                )

                )

                )

                )

              	
                /s/
                  M.A. Russell

                 

                /s/
                  Ania Lipinski

                Stephenson
                  Harwood

                One,
                  St. Paul’s Churchyard

                London
                  EC4M 8SH

                 

              
	
                SIGNED
                  by

                duly
                  authorised for and on behalf 

                of
                  THE
                  ROYAL BANK OF SCOTLAND PLC

                (as
                  Bank)

                in
                  the presence of:- Ania Lipinski

              	
                )

                )

                )

                )

                )

              	
                /s/
                  Ian Mace

                 

                /s/
                  Ania Lipinski

                Stephenson
                  Harwood

                One,
                  St. Paul’s Churchyard

                London
                  EC4M 8SH

                 

              
	
                SIGNED
                  by
                  B. Streeter

                duly
                  authorised for and on behalf 

                of
                  GULF OFFSHORE N.S. LIMITED

                in
                  the presence of:- 

              	
                )

                )

                )

                )

                )

              	
                /s/
                  Bruce Streeter

                 

                /s/
                  Mary Kay Kutka

                Mary
                  Kay Kutka

                10111
                  Richmond Ave., Ste. 340

                Houston,
                  TX 77042

              

      

      

    

    

    

    
      
        
          
          

        

        
          90Exhibit 10.30

    
      
        

      

    

    DATED
          1st
      June            
2006

    

    

    

    

    GULFMARK
      REDERI AS

    (as
      borrower)

    

    -
      and -

    

    DnB
      NOR Bank ASA

    and
      others

    (as
      banks)

    

    -
      and -

    

    

    DnB
      NOR Bank ASA

    (as
      mandated lead arranger)

    

    -
      and -

    

    DnB
      NOR Bank ASA

    (as
      agent and security trustee)

    

    

    

    _________________________________________

    

    US$30,000,000
      SECURED

    REDUCING
      REVOLVING LOAN

    FACILITY
      AGREEMENT

    _________________________________________

    

    

    

    

    

    

    

    

    STEPHENSON
      HARWOOD

    One,
      St. Paul's Churchyard

    London
      EC4M 8SH

    Tel:
      020 7329 4422

    Fax:
      020 7329 7100

    Ref:
      1313

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    CONTENTS

    
 

    
      	
              1

            	
              Definitions
                and Interpretation

            	
              1

            
	
              2

            	
              The
                Facility and its Purpose

            	
              21

            
	
              3

            	
              Conditions Precedent and Subsequent

            	
              27

            
	
              4

            	
              Representations
                and Warranties

            	
              31

            
	
              5

            	
              Repayment,
                Prepayment and Currency Option

            	
              35

            
	
              6

            	
              Interest

            	
              38

            
	
              7

            	
              Fees

            	
              40

            
	
              8

            	
              Security
                Documents

            	
              40

            
	
              9

            	
              Agency
                and Trust

            	
              41

            
	
              10

            	
              Covenants

            	
              50

            
	
              11

            	
              Earnings

            	
              67

            
	
              12

            	
              Events Of Default

            	
              68

            
	
              13

            	
              Set-Off
                and Lien

            	
              72

            
	
              14

            	
              Assignment and
                Sub-Participation

            	
              74

            
	
              15

            	
              Payments,
                Mandatory Prepayment, Reserve Requirements and Illegality

            	
              76

            
	
              16

            	
              Communications

            	
              80

            
	
              17

            	
              General
                Indemnities

            	
              81

            
	
              18

            	
              Miscellaneous

            	
              84

            
	
              19

            	
              Law and Jurisdiction

            	
              88

            
	 	
              SCHEDULE
                1

            	
              90

            
	 	
              The
                Banks, the Commitments and the Proportionate Shares

            	
              90

            
	 	
              SCHEDULE
                2

            	
              91

            
	 	
              The
                Vessels

            	
              91

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

      
        	
                SCHEDULE
                  3

              	
                92

              
	
                Form
                  of Transfer Certificate

              	
                92

              
	
                SCHEDULE
                  4

              	
                95

              
	
                Form
                  of Drawdown Notice

              	
                95

              
	
                SCHEDULE
                  5

              	
                97

              
	
                Calculation
                  of the Mandatory Cost

              	
                97

              
	
                SCHEDULE
                  6

              	
                100

              
	
                Form
                  of Compliance Certificate

              	
                100

              
	
                SCHEDULE
                  7

              	
                102

              
	
                Calculation
                  of Effective Interest

              	
                102

              

      

    

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    LOAN
      FACILITY AGREEMENT

     

    Dated:
        1st
      June 2006

     

    BETWEEN:-

     

    
      	
              (1)

            	
              GULFMARK
                REDERI AS,
                a
                company incorporated according to the law of Norway whose principal
                place
                of business is at Strandgaten 5, 4307 Sandnes, Norway (the
                "Borrower");
                and 

            

    

     

    
      	
              (2)

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

            

    

     

    
      	
              (3)

            	
              DnB
                NOR Bank ASA acting
                as mandated lead arranger (in that capacity the "MLA");
                and

            

    

     

    
      	
              (4)

            	
              DnB
                NOR Bank ASA
                acting as agent and security trustee through its office at Lars Hillesgate
                30, PO Box 7100, NO-5020 Bergen, Norway (in that capacity the
                "Agent").

            

    

     

    WHEREAS:-

     

    Each
      of
      the Banks has agreed to
      advance
      to the Borrower its respective Commitment of an aggregate principal amount
      not
      exceeding thirty million Dollars ($30,000,000) for the general corporate
      purposes of the Borrower.

     

    IT IS AGREED
      as
      follows:-

     

    
      	1  	
              Definitions
                and Interpretation

            

    

     

    1.1 Definitions

     

    In
      this
      Agreement:-

     

    
      	 	
              1.1.1

            	
              "Accounts"
                means the consolidated financial accounts of the Guarantor to be
                provided
                to the Agent pursuant hereto.

            

    

     

    
      	 	
              1.1.2

            	
              "Address
                for Service"
                means c/o Gulf Offshore N.S. Limited of 10 Charlotte Road, Barnes,
                London,
                SW13 9QJ, England or, in relation to any of the Security Parties,
                such
                other address in England and Wales as

            

    

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    that
      Security Party may from time to time designate by no fewer than ten (10)
      Business Days' written notice to the Agent.

     

    
      	 	
              1.1.3

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

            

    

     

    
      	 	
              1.1.4

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

            

    

     

    
      	 	
              1.1.5

            	
              "Agent's
                Spot Rate of Exchange"
                means the Agent's spot rate of exchange for the purchase of the relevant
                currency with the Base Currency in the London foreign exchange market
                at
                or about 11.00 a.m. on a particular
                day.

            

    

     

    
      	 	
              1.1.6

            	
              "Approved
                Brokers"
                means H. Clarkson & Co. Ltd, Simpson Spence & Young Shipbrokers
                Ltd, Fearnley AS, R. S. Platou AS and Seabrokers
                Group.

            

    

     

    
      	 	
              1.1.7

            	
              "Assignments"
                means the first priority assignments of the Insurances and Requisition
                Compensation of the Vessels to be made between the Borrower and the
                Agent
                referred to in Clause 8.1.2 (each an "Assignment").

            

    

     

    
      	 	
              1.1.8

            	
              "Assigned
                Property"
                means the Insurances and the Requisition
                Compensation.

            

    

     

    1.1.9 "Base
      Currency"
      means
      Dollars.

     

    
      	 	
              1.1.10

            	
              "Base
                Currency Amount"
                means the amount specified in the Drawdown Request or, if the amount
                requested is not denominated in the Base Currency, that amount converted
                into the Base Currency at the Agent's Spot Rate of Exchange on the
                date
                which is three (3) Business Days before the Advance Date adjusted
                to
                reflect any repayment (other than a repayment arising from a change
                of
                currency) or prepayment.

            

    

     

    
      	 	
              1.1.11

            	
              "Borrower's
                Obligations"
                means all of the liabilities and obligations of the Borrower to the
                Finance Parties under or pursuant to the Borrower's Security Documents,
                whether actual or contingent, present

            

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    or
      future, and whether incurred alone or jointly or jointly and severally with
      any
      other and in whatever currency, including (without limitation) interest,
      commission and all other charges and expenses.

     

    
      	 	
              1.1.12

            	
              "Borrower's
                Security Documents"
                means those of the Security Documents to which the Borrower is or
                is to be
                a party.

            

    

     

    
      	 	
              1.1.13

            	
              "Break
                Costs"
                means all documented costs, losses, premiums or penalties incurred
                by any
                of the Finance Parties in the circumstances contemplated by Clause
                17.4 or
                as a result of any of them receiving any prepayment of all or any
                part of
                the Facility (whether pursuant to Clauses 5.2 and 5.3 or otherwise)
                or any
                other payment under or in relation to the Security Documents on a
                day
                other than the due date for payment of the sum in question, and includes
                (without limitation) any losses or costs incurred in liquidating
                or
                re-employing deposits from third parties acquired to effect or maintain
                the Facility, and any liabilities, expenses or losses incurred by
                any of
                the Finance Parties in terminating or reversing, or otherwise in
                connection with, any interest rate and/or currency swap, transaction
                or
                arrangement entered into by any of the Finance Parties with any member
                of
                the Group to hedge any exposure arising under this Agreement, or
                in
                terminating or reversing, or otherwise in connection with, any open
                position arising under this
                Agreement.

            

    

     

    
      	 	
              1.1.14

            	
              "Business
                Day"
                means a day (other than a Saturday or Sunday) on which banks are
                open for
                general business in London, New York City and Bergen and which is
                a TARGET
                Day.

            

    

     

    
      	 	
              1.1.15

            	
              "Commitment"
                means, in relation to each Bank, the amount of the Facility which
                that
                Bank agrees to advance to the Borrower as its several liability as
                indicated against the name of that Bank in Schedule 1, as reduced
                from time to time in accordance with Clause 2.4, or, where the context
                permits, the amount of the Facility advanced by that Bank and remaining
                outstanding.

            

    

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    
      	 	
              1.1.16

            	
              "Commitment
                Commission"
                means the commitment commission to be paid by the Borrower to the
                Agent on
                behalf of the Banks pursuant to Clause
                7.

            

    

     

    
      	 	
              1.1.17

            	
              "Commitment
                Termination Date"
                means the date falling one month prior to the Termination
                Date.

            

    

     

    
      	 	
              1.1.18

            	
              "Communication"
                means any notice, approval, demand, request or other communication
                from
                one party to this Agreement to any other party to this
                Agreement.

            

    

     

    
      	 	
              1.1.19

            	
              "Communications
                Address"
                means 10111 Richmond Avenue, Suite 340, Houston, Texas, 77042, the
                United
                States of America (fax no: +1 713 963 0541 marked for the attention
                of Mr
                E. Guthrie, email:
                ed.guthrie@gulfmark.com).

            

    

     

    
      	 	
              1.1.20

            	
              "Company"
                means at any given time the company responsible for a Vessel's compliance
                with (i) the ISM Code under paragraph 1.1.2 of the ISM Code and/or
                (ii)
                the ISPS Code (as the case may be).

            

    

     

    
      	 	
              1.1.21

            	
              "Compliance
                Certificate"
                means a certificate to be delivered by the Borrower to the Agent
                substantially in the form of Schedule
                6.

            

    

     

    
      	 	
              1.1.22

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

            

    

     

    
      	 	
              1.1.23

            	
              "Default
                Rate"
                means the rate which is the aggregate of LIBOR, any Mandatory Cost,
                the
                Margin and two per centum (2%) per
                annum.

            

    

     

    
      	 	
              1.1.24

            	
              "Determination
                Date"
                means

            

    

     

    (a) the
      last
      day of each calendar quarter during the Facility Period;

     

    (b) after
      the
      occurrence of an Event of Default which is continuing, any date designated
      by
      the Agent upon at least 

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    three
      (3)
      Business Days' prior written notice to the Borrower; and

     

    (c) each
      Advance Date.

     

    
      	 	
              1.1.25

            	
              "DOC"
                means in relation to the ISM Company, a valid Document of Compliance
                issued for the ISM Company by the Administration under paragraph
                13.2 of
                the ISM Code.

            

    

     

    
      	 	
              1.1.26

            	
              "Dollars"
                "US$"
                and "$"
                each means available and freely transferable and convertible funds
                in
                lawful currency of the United States of
                America.

            

    

     

    
      	 	
              1.1.27

            	
              "Drawdown
                Notice"
                means a notice complying with Clause 2.3 in the form set out in Schedule
                4.

            

    

     

    
      	 	
              1.1.28

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

            

    

     

    
      	 	
              1.1.29

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

            

    

     

    
      	 	
              1.1.30

            	
              "Earnings
                Account"
                means a bank account to be opened in the name of the Borrower with
                the
                Agent and designated "Vessel Net Earnings Account".
                

            

    

     

    
      	 	
              1.1.31

            	
              "EBITDA"
                means, for any twelve month period ending on a Determination Date,
                the
                consolidated profit on ordinary activities of the Group before
                Taxes:

            

    

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    (a) adjusted
      to exclude interest received or receivable and other similar income to the
      extent not already excluded;

     

    (b) before
      the depreciation of fixed assets but after excluding any loss or gain arising
      on
      the disposal of fixed assets or shares;

     

    (c) before
      the deduction of Interest Expense for such period;

     

    (d) before
      any charge for the amortisation of goodwill, merger differences, acquisition
      costs or any other intangible asset; and

     

    (e) before
      adding or deducting extraordinary or exceptional items (to include, for the
      avoidance of doubt, any redundancy costs and foreign exchange profits and losses
      in relation to the funding of the business) in each case for such
      period.

     

    
      	 	
              1.1.32

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

            

    

     

    
      	 	
              1.1.33

            	
              "Environmental
                Affiliate"
                means an agent or employee of the Borrower or a person in a contractual
                relationship with the Borrower in respect of the Vessel owned by
                it
                (including without limitation, the operation of or the carriage of
                cargo
                of such Vessel).

            

    

     

    
      	 	
              1.1.34

            	
              "Environmental
                Approvals"
                means any present or future permit, licence, approval, ruling, variance,
                exemption or other authorisation required under the applicable
                Environmental Laws.

            

    

     

    
      	 	
              1.1.35

            	
              "Environmental
                Claim"
                means any and all enforcement, clean-up, removal, administrative,
                governmental, regulatory or judicial actions, orders, demands or
                investigations instituted or completed pursuant to any Environmental
                Laws
                or Environmental Approvals together with any claims made by any third
                person relating to damage, contribution, loss or injury resulting
                from any
                Environmental Incident.

            

    

     

    
      	 	
              1.1.36

            	
              "Environmental
                Incident"
                means:

            

    

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    
      	 	
              (a)

            	
              any
                release of Environmentally Sensitive Material from a Vessel;
                or

            

    

     

    
      	 	
              (b)

            	
              any
                incident in which Environmentally Sensitive Material is released
                from a
                vessel other than a Vessel and which involves a collision between
                a Vessel
                and such other vessel or some other incident of navigation or operation,
                in either case, in connection with which the relevant Vessel is actually
                or potentially liable to be arrested, attached, detained or injuncted
                and/or where any guarantor, any manager (or any sub-manager of such
                Vessel) or any of its officers, employees or other persons retained
                or
                instructed by it (or such sub-manager) are at fault or allegedly
                at fault
                or otherwise liable to any legal or administrative action;
                or

            

    

     

    
      	 	
              (c)

            	
              any
                other incident in which Environmentally Sensitive Material is released
                otherwise than from such Vessel and in connection with which that
                Vessel
                is actually or potentially liable to be arrested and/or where any
                guarantor, any manager (or any sub-manager of the relevant Vessel)
                or any
                of its officers, employees or other persons retained or instructed
                by it
                (or such sub-manager) are at fault or allegedly at fault or otherwise
                liable to any legal or administrative
                action.

            

    

     

    
      	 	
              1.1.37

            	
              "Environmental
                Laws"
                means all present and future laws, regulations, treaties and conventions
                of any applicable jurisdiction
                which:

            

    

     

    
      	 	
              (a)

            	
              have
                as a purpose or effect the protection of, and/or prevention of harm
                or
                damage to, the environment;

            

    

     

    
      	 	
              (b)

            	
              relate
                to the carriage of Environmentally Sensitive Material or to actual
                or
                threatened releases of Environmentally Sensitive
                Material;

            

    

     

    
      	 	
              (c)

            	
              provide
                remedies or compensation for harm or damage to the environment;
                or

            

    

     

    
      	 	
              (d)

            	
              relate
                to Environmentally Sensitive Materials or health or safety
                matters.

            

    

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    
      	 	
              1.1.38

            	
              "Environmentally
                Sensitive Material"
                means (i) oil and oil products and (ii) any other waste, pollutant,
                contaminant or other substance (including any liquid, solid, gas,
                ion,
                living organism or noise) that may be harmful to human health or
                other
                life or the environment or a nuisance to any person or that may make
                the
                enjoyment, ownership or other territorial control of any affected
                land,
                property or waters more costly for such person to a material
                degree.

            

    

     

    1.1.39 "EURIBOR"
      means:

     

    (a) the
      applicable Screen Rate; or

     

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

     

    
      	 	 	
              at
                11.00 a.m. (Brussels time) on the Quotation Day for the offering
                of
                deposits in euro in an amount comparable to the Loan (or any relevant
                part
                of the Loan) and for a period comparable to the relevant Interest
                Period.

            

    

     

    
      	 	
              1.1.40

            	
              "euro"
                and "€"
                means the single currency of the Participating Member
                States.

            

    

     

    
      	 	
              1.1.41

            	
              "Event
                of Default"
                means any of the events set out in
                Clause 12.2.

            

    

     

    
      	 	
              1.1.42

            	
              "Execution
                Date"
                means the date on which this Agreement is executed by each of the
                parties
                hereto.

            

    

     

    
      	 	
              1.1.43

            	
              "Facility"
                means the reducing revolving credit facility made available by the
                Banks
                to the Borrower pursuant to this
                Agreement.

            

    

     

    
      	 	
              1.1.44

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

            

    

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    
      	 	
              1.1.45

            	
              "Facility
                Period"
                means the period beginning on the Execution Date and ending on the
                date
                when the whole of the Indebtedness has been repaid in full and the
                Borrower has ceased to be under any further actual or contingent
                liability
                to the Finance Parties under or in connection with the Security
                Documents.

            

    

     

    
      	 	
              1.1.46

            	
              "Fee
                Letter"
                means a letter or letters from the Agent to the Borrower setting
                out
                certain fees payable to the Agent in connection with the
                Facility.

            

    

     

    
      	 	
              1.1.47

            	
              "Final
                Balloon Payment"
                means an amount of twenty million Dollars ($20,000,000), less any
                voluntary cancellation pursuant to Clause 2.4.2 or any mandatory
                prepayment pursuant to Clause 2.4.3 or Clause 2.4.4, which shall
                be
                payable on the Termination Date.

            

    

     

    
      	 	
              1.1.48

            	
              "Finance
                Parties"
                means the Banks, the MLA and the
                Agent.

            

    

     

    
      	 	
              1.1.49

            	
              "Financial
                Indebtedness"
                means any indebtedness of any person for or in respect
                of:

            

    

     

    
      	 	
              (a)

            	
              moneys
                borrowed or raised;

            

    

     

    
      	 	
              (b)

            	
              amounts
                raised under any acceptance credit
                facility;

            

    

     

    
      	 	
              (c)

            	
              amounts
                raised pursuant to any note purchase facility or the issue of bonds,
                notes, debentures, loan stock or similar
                instruments;

            

    

     

    
      	 	
              (d)

            	
              amounts
                raised pursuant to any issue of shares of the relevant person which
                are
                expressed to be redeemable;

            

    

     

    
      	 	
              (e)

            	
              the
                amount of any liability in respect of leases or hire purchase contracts
                which would, in accordance with GAAP, be treated as finance or capital
                leases;

            

    

     

    
      	 	
              (f)

            	
              all
                reimbursement obligations whether contingent or not in respect of
                amounts
                paid under a letter of credit or similar
                instrument;

            

    

     

    
      	 	
              (g)

            	
              all
                interest rate, currency swap and similar agreements obliging the
                making of
                payments, whether periodically or upon the

            

    

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    happening
      of a contingency (and the value of such indebtedness shall be the mark-to-market
      valuation of such transaction at the relevant time);

     

    
      	 	
              (h)

            	
              amounts
                raised under any other transaction (including, without limitation,
                any
                forward sale or purchase agreement) having the commercial effect
                of a
                borrowing; and

            

    

     

    
      	 	
              (i)

            	
              any
                guarantee of indebtedness falling within paragraphs (a) to (i)
                above.

            

    

     

    
      	 	
              1.1.50

            	
              "First
                Reduction Date"
                means the date falling sixty six (66) calendar months after the Execution
                Date.

            

    

     

    
      	 	
              1.1.51

            	
              "GAAP"
                means either IFRS or the generally accepted accounting principles
                in the
                United States of America.

            

    

     

    
      	 	
              1.1.52

            	
              "Group"
                means GulfMark Offshore, Inc. and each of its
                Subsidiaries.

            

    

     

    
      	 	
              1.1.53

            	
              "Guarantee"
                means the guarantee and indemnity to be made by the Guarantor in
                favour of
                the Agent referred to in
                Clause 8.1.3.

            

    

     

    
      	 	
              1.1.54

            	
              "Guarantor"
                means GulfMark Offshore, Inc., a company incorporated according to
                the law
                of the State of Delaware whose principal place of business is
                at 10111 Richmond Avenue, Suite 340, Houston, Texas, 77042, the
                United States of America.

            

    

     

    
      	 	
              1.1.55

            	
              "IFRS"
                means International Financial Reporting Standards issued and/or adopted
                by
                the International Accounting Standards
                Board.

            

    

     

    
      	 	
              1.1.56

            	
              "Indebtedness"
                means the Facility Outstandings; all other sums of any nature including
                costs (together with all interest on any of those sums) which from
                time to
                time may be payable by the Borrower to the Finance Parties pursuant
                to the
                Security Documents; any damages payable as a result of any breach
                by the
                Borrower of any of the Security Documents; and any damages or other
                sums
                payable as a result of any of the obligations of the Borrower under
                or
                pursuant to any of the Security Documents being disclaimed by a liquidator
                or any other person, or, 

            

    

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    where
      the
      context permits, the amount thereof for the time being outstanding.

     

    
      	 	
              1.1.57

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

            

    

     

    
      	 	
              1.1.58

            	
              "Interest
                Expense"
                means the interest paid by any member of the Group on the Total Debt
                in
                the twelve month period ending on a Determination
                Date.

            

    

     

    
      	 	
              1.1.59

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

            

    

     

    
      	 	
              1.1.60

            	
              "Interest
                Period"
                means each interest period selected by the Borrower or agreed by
                the Banks
                pursuant to Clause 6.

            

    

     

    
      	 	
              1.1.61

            	
              "ISM
                Code"
                means the International Ship Management Code for the Safe Operation
                of
                Ships and for Pollution Prevention.

            

    

     

    
      	 	
              1.1.62

            	
              "ISM
                Company"
                means, at any given time, the company responsible for a Vessel's
                compliance with the ISM Code under paragraph 1.1.2 of the ISM
                Code.

            

    

     

    
      	 	
              1.1.63

            	
              "ISPS
                Code"
                means the International Ship and Port Security Code as adopted by
                the
                Conference of Contracting Governments to the Safety of Life at Sea
                Convention 1974 on 13 December 2002 and incorporated as Chapter XI-2
                of
                the Safety of Life at Sea Convention
                1974.

            

    

     

    
      	 	
              1.1.64

            	
              "law"
                or "Law"
                means any law, statute, treaty, convention, regulation, instrument
                or
                other subordinate legislation or other legislative or quasi-legislative
                rule or measure, or any order or decree of any government, judicial
                or
                public or other body or authority, or any directive, code of
                

            

    

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    practice,
      circular, guidance note or other direction issued by any competent authority
      or
      agency (whether or not having the force of law).

     

    
      	 	
              1.1.65

            	
              "LIBOR"
                means:

            

    

     

    (a) the
      applicable Screen Rate; or 

     

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

     

    
      	 	 	
              at
                11.00 a.m. (London time) on the Quotation Day for the offering of
                deposits
                in the currency in which the Facility is to be denominated during
                the
                relevant Interest Period in an amount comparable to the Facility
                (or any
                relevant part of the Facility) and for a period comparable to the
                relevant
                Interest Period.

            

    

     

    
      	 	
              1.1.66

            	
              "Majority
                Banks"
                means any one or more Banks whose combined Proportionate Shares exceed
                sixty six and two thirds per centum
                (662⁄3%).

            

    

     

    
      	 	
              1.1.67

            	
              "Manager"
                means GulfMark Offshore, Inc. or any entity within the
                Group.

            

    

     

    
      	 	
              1.1.68

            	
              "Mandatory
                Cost"
                means for each Bank to which it applies, the cost imputed to that
                Bank of
                compliance with the mandatory liquid asset requirements of the Bank
                of
                England and/or the banking supervision or other costs imposed by
                the
                Financial Services Authority, determined in accordance with Schedule
                 5 (Calculation of the Mandatory
                Cost).

            

    

     

    
      	 	
              1.1.69

            	
              "Margin"
                shall be calculated on, and effective from each Determination Date
                in
                accordance with the following grid based on the ratio of (a) the
                Guarantor's average Total Debt over the twelve (12) month period
                terminating on the relevant Determination Date to (b) the Guarantor's
                consolidated EBITDA determined on the relevant Determination
                Date:

            

    

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

    

     

    
      	
              Total
                Debt/EBITDA

               

            	 	
              Applicable
                Margin

               

            
	
              Less
                than 2.5

               

            	 	
              0.70%
                p.a.

               

            
	
              Equal
                to or greater than 2.5

               

            	 	 
	
              but
                less than 5.0

               

            	 	
              0.80%
                p.a.

               

            
	
              Equal
                to or greater than 5.0

               

            	 	
              0.90%
                p.a.

               

            

    

    
      	 	
              1.1.70

            	
              "Material
                Adverse Effect"
                means a material adverse change in, or a material adverse effect
                on:

            

    

     

    
      	 	
              (a)

            	
              the
                financial condition, assets, prospects or business of any Security
                Party
                or on the consolidated financial condition, assets, prospects or
                business
                of the Group;

            

    

     

    
      	 	
              (b)

            	
              the
                ability of any Security Party to perform and comply with its obligations
                under any Security Document or to avoid any Event of
                Default;

            

    

     

    
      	 	
              (c)

            	
              the
                validity, legality or enforceability of any Security Document;
                or

            

    

     

    
      	 	
              (d)

            	
              the
                validity, legality or enforceability of any security expressed to
                be
                created pursuant to any Security Document or the priority and ranking
                of
                any such security.

            

    

     

    1.1.71 "Material
      Subsidiary"
      means
      any Subsidiary of the Guarantor whose net asset value represents ten per cent
      (10%) or more of the net asset value of the Group, as indicated by the financial
      statements to be delivered to the Agent pursuant to Clause 10.2.1.

     

    
      	 	
              1.1.72

            	
              "Maximum
                Facility Amount"
                means an amount not exceeding thirty million Dollars ($30,000,000),
                subject
                to any reductions effected in accordance with Clauses 2.4, 15.7 and
                15.8.

            

    

     

    
      	 	
              1.1.73

            	
              "Mortgages"
                means the first priority ship mortgages together with collateral
                declaration of pledge thereto over each of the Vessels made or
                

            

    

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    to
      be
      made between the Borrower and the Agent referred to in Clause 8.1.1 (each a
      "Mortgage").

     

    
      	 	
              1.1.74

            	
              "Mortgagees'
                Insurances"
                means all policies and contracts of mortgagees' interest insurance,
                mortgagees' additional perils (oil pollution) insurance and any other
                insurance from time to time taken out by the Mortgagee in relation
                to the
                Vessel.

            

    

     

    1.1.75 "Net
      Earnings"
      means
      the Earnings less any Operating Commissions. 

     

    1.1.76 "NIBOR"
      means
      the Norwegian interbank offered rate being the rate per annum equal to the
      offered quotation for deposits in amounts equal to that Drawing (and for periods
      equal to the Interest Period of that Drawing) appearing on Reuters Screen page
      NIBR, published by Reuters through its monitor service or any equivalent
      successor to such service at or about 12:00 p.m. (Oslo time) on the applicable
      Quotation Day or if no such rate is available, the arithmetic mean (rounded
      upwards to the nearest 1/16 of one per cent) of the rate per annum at which
      the
      Agent is able to acquire NOK in the amount and for the Interest Period equal
      to
      such Drawing in the Norwegian interbank market at or about 12:00 p.m. (Oslo
      time) on the applicable Quotation Day.

     

    1.1.77 "Norwegian
      Kroner"
      means
      the lawful currency of the Kingdom of Norway.

     

    1.1.78 "Obligatory
      Insurances"
      means
      the insurances and entries referred to in Clause 10.3.1 and, where applicable,
      those referred to in Clauses 10.3.2, 10.3.5 and/or 10.4.12.

     

    1.1.79 "Optional
      Currency"
      means
      any of Dollars, Sterling, Euro and Norwegian Kroner.

     

    1.1.80 "Operating
      Commissions"
      means
      any commissions or fees payable by the Borrower in respect of any of the Vessels
      to any agents in respect of the chartering of the Vessels. 

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    
      	 	
              1.1.81

            	
              "Participating
                Member State"
                means any member state of the European Community that adopts or has
                adopted the euro as its lawful currency in accordance with legislation
                of
                the European Community relating to Economic and Monetary
                Union.

            

    

     

    
      	 	
              1.1.82

            	
              "Party"
                means a party to this Agreement. 

            

    

     

    
      	 	
              1.1.83

            	
              "Permitted
                Liens"
                means (i) any Encumbrance which has the prior written approval of
                the
                Agent or (ii) any Encumbrances that arise either by operation of
                law or in
                the ordinary course of the business of the relevant Security Party
                which
                are discharged in the ordinary course of
                business.

            

    

     

    
      	 	
              1.1.84

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

            

    

     

    
      	 	
              1.1.85

            	
              "Pre-Approved
                Classification Society"
                means any of Det norske Veritas, Lloyds Register of Shipping, American
                Bureau of Shipping (ABS), Germanischer Lloyd or Bureau
                Veritas.

            

    

     

    
      	 	
              1.1.86

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

            

    

     

    
      	 	
              1.1.87

            	
              "Proportionate
                Share"
                means, for each Bank, the percentage that its Commitment bears to
                the
                aggregate Commitments of all Banks from time to time, being initially
                the
                percentage indicated against the name of that Bank in Schedule
                1.

            

    

     

    1.1.88 "Quotation
      Day"
      means,
      in relation to any period for which an interest rate is to be determined
      :

     

    (a) (if
      the
      currency is sterling) the first day of that period; 

     

    (b) (if
      the
      currency is euro) two TARGET Days before the first day of that period; or

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    (c) (for
      any
      other currency) two Business Days before the first day of that
      period,

     

    unless
      market practice differs in the relevant interbank market for a currency, in
      which case the Quotation Day will be determined by the Agent in accordance
      with
      market practice in that interbank market.

     

    
      	 	
              1.1.89

            	
              "Reference
                Banks"
                means the office of DnB NOR Bank ASA at Lars Hillesgate 30, PO Box
                7100,
                NO-5020 Bergen, Norway and The Royal Bank of Scotland plc at 1 Albyn
                Place, Aberdeen AB10 1BR, Scotland or such other banks as may be
                appointed
                by the Agent in consultation with the
                Borrower.

            

    

     

    
      	 	
              1.1.90

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

            

    

     

    1.1.91 "Screen
      Rate"
      means:

     

    
      	 	
              (a)

            	
              in
                relation to LIBOR, the British Bankers' Association Interest Settlement
                Rate for the relevant currency and period;
                and

            

    

     

    
      	 	
              (b)

            	
              in
                relation to EURIBOR, the percentage rate per annum determined by
                the
                Banking Federation of the European Union for the relevant period;
                and

            

    

     

    
      	 	
              (c)

            	
              in
                relation to NIBOR, Reuters screen page
                NIBR,

            

    

     

    
      	 	 	
              displayed
                on the appropriate page of the Reuters screen. If the agreed page
                is
                replaced or the service ceases to be available, the Agent may specify
                another page or service displaying the appropriate rate after consultation
                with the Borrower and the Banks.

            

    

     

    1.1.92 "Security
      Documents"
      means
      this Agreement, the Assignments, the Mortgages, the Guarantee or (where the
      context permits) any one or more of them, and any other agreement or document
      which may at any 

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    time
      be
      executed as security for the payment of all or any part of the
      Indebtedness.

     

    1.1.93 "Security
      Parties"
      means,
      at any relevant time, the Borrower, the Guarantor and any other party who may
      at
      any time during the Facility Period be liable for, or provide security for,
      all
      or any part of the Indebtedness, and "Security
      Party"
      means
      any one of them. 

     

    1.1.94 "SMC"
      means a
      valid safety management certificate issued for a Vessel by or on behalf of
      the
      Administration under paragraph 13.7 of the ISM Code.

     

    1.1.95 "SMS"
      means,
      in relation to each Vessel, a safety management system for that Vessel developed
      and implemented in accordance with the ISM Code and including the functional
      requirements, duties and obligations required by the ISM Code.

     

    1.1.96 "Sterling"
      means
      the lawful currency of England.

     

    1.1.97 "Subsequent
      Reduction Dates"
      means
      each date falling at consecutive six monthly intervals after the previous
      Subsequent Reduction Date which in the case of the first Subsequent Reduction
      Date shall be six months after the First Reduction Date.

     

    1.1.98 "Subsidiary"
      means a
      subsidiary undertaking, as defined in section 736 Companies Act 1985, or any
      analogous definition under any other relevant system of law.

     

    1.1.99 "TARGET"
      means
      the Trans-European Automated Real-time Gross Settlement Express Transfer payment
      system.

     

    1.1.100 "TARGET
      Day"
      means
      any day on which TARGET is open for the settlement of payments in
      euro.

     

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

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

    
      	 	
              1.1.102

            	
              "Termination
                Date"
                means the seventh anniversary of the Execution
                Date.

            

    

     

    
      	 	
              1.1.103

            	
              "Threshold
                Amount"
                means one million Dollars ($1,000,000) or its equivalent in any other
                currency.

            

    

     

    
      	 	
              1.1.104

            	
              "Total
                Assets"
                means the amount which is equal to the total consolidated assets
                of the
                Guarantor as shown in the Guarantor's latest audited consolidated
                balance
                sheet less the goodwill (if any) of the Guarantor as shown in the
                Guarantor's latest audited balance
                sheet.

            

    

     

    
      	 	
              1.1.105

            	
              "Total
                Debt"
                means the aggregate of:-

            

    

     

    (a) the
      amount calculated in accordance with GAAP shown as each of "long term debt",
      "short term debt" and "current portion of long term debt" on the latest
      consolidated balance sheet of the Guarantor; and

     

    (b) the
      amount of any liability in respect of any lease or hire purchase contract
      entered into by the Guarantor or any of its Subsidiaries which would, in
      accordance with GAAP, be treated as a finance or capital lease.

     

    
      	 	
              1.1.106

            	
              "Total
                Loss",
                in relation to a Vessel, means:- 

            

    

     

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

     

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

     

    (c) the
      capture, seizure, arrest, detention or confiscation of that Vessel, unless
      the
      Vessel is released and returned to the possession of the Borrower within thirty
      (30) days after the capture, seizure, arrest, detention or confiscation in
      question.

     

    
      	 	
              1.1.107

            	
              "Total
                Shareholders Equity"
                means the aggregate of the amount paid up on the issued share capital
                of
                any relevant entity and the amount 

            

    

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

    standing
      to the credit of its capital and revenue reserves (including any share premium
      account or capital redemption reserve but excluding any revaluation reserve,)
      plus or minus the amount standing to the credit or debit (as the case may be)
      of
      its profit and loss account.

     

    
      	 	
              1.1.108

            	
              "Transfer
                Certificate"
                means a certificate materially in the form set forth in Schedule
                3 signed
                by a Bank and a Transferee
                whereby:-

            

    

     

    (a) such
      Bank
      seeks to procure the transfer to such Transferee of all or a part of such Bank's
      rights and obligations under this Agreement upon and subject to the terms and
      conditions set out in Clause 14; and

     

    (b) such
      Transferee undertakes to perform the obligations it will assume as a result
      of
      delivery of such certificate to the Agent as is contemplated in Clause
      14.

     

    
      	 	
              1.1.109

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

            

    

     

    1.1.110 "Transferee"
      means a
      bank or other financial institution to which a Bank seeks to transfer all or
      part of such Bank's rights and obligations under this Agreement.

     

    1.1.111 "Trust
      Property"
      means:-

     

    (a) the
      benefit of Clause 8 and the covenants contained in Clause 9.3;
      and

     

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

     

    1.1.112 "Valuation"
      means
      in relation to a Vessel the average of the written valuations of that Vessel
      expressed in Dollars prepared by two of the Approved Brokers (or such other
      firms of reputable independent shipbrokers as may be acceptable to the Majority
      Banks), to be 

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

    nominated
      by the Borrower. Such valuations shall be prepared at the Borrower's expense
      (unless otherwise stated in this Agreement), without a physical inspection,
      on
      the basis of a sale for prompt delivery for cash at arm's length on a charter
      free basis between a willing buyer and a willing seller. 

     

    
      	 	
              1.1.113

            	
              "Vessels" means,
                subject to Clause 2.10, those vessels listed in Schedule 2 (each
                a "Vessel").

            

    

     

    1.2 Interpretation

     

    In
      this
      Agreement:-

     

    
      	 	
              1.2.1

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

            

    

     

    
      	 	
              1.2.2

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

            

    

     

    
      	 	
              1.2.3

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

            

    

     

    
      	 	
              1.2.4

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

            

    

     

    
      	 	
              1.2.5

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

            

    

     

    
      	 	
              1.2.6

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

            

    

     

    
      	 	
              1.2.7

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

            

    

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

    
      	 	
              1.2.8

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

            

    

     

    
      	 	
              1.2.9

            	
              references
                to times of day are unless otherwise stated to London time;
                and

            

    

     

    
      	 	
              1.2.10

            	
              unless
                the contrary intention appears, a reference to a month or months
                is a
                reference to a period starting on one day in a calendar month and
                ending
                on the numerically corresponding day in the next calendar month or
                the
                calendar month in which it is to end, except
                that:

            

    

     

    (i) if
      the
      numerically corresponding day is not a Business Day, the period will end on
      the
      next Business Day in that month (if there is one) or the preceding Business
      Day
      (if there is not);

     

    (ii) if
      there
      is no numerically corresponding day in that month, that period will end on
      the
      last Business Day in that month; and

     

    (iii) notwithstanding
      sub-paragraph (i) above, a period which commences on the last Business Day
      of a
      month will end on the last Business Day in the next month or the calendar month
      in which it is to end, as appropriate.

     

    
      	2  	
              The
                Facility and its Purpose

            

    

     

    
      	 	
              2.1

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

            

    

     

    
      	 	
              2.2

            	
              Drawings
                Subject
                to satisfaction by the Borrower of the conditions set out in
                Clause 3.1 (in respect of the first Drawing), or Clause 3.2 (in
                respect of all subsequent Drawings) and subject to Clause 2.3, and
                provided that the maximum aggregate amount of the Facility Outstandings
                at
                any given time during the Facility Period shall not exceed the Maximum
                Facility Amount, each Drawing shall be advanced to the Borrower,
                in each
                case by the Agent transferring the amount of the Drawing to such
                account
                as the Borrower shall notify to the Agent

            

    

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

    in
      the
      relevant Drawdown Notice by such same day method of funds transfer as the Agent
      shall select.

     

    
      	 	
              2.3

            	
              Advance
                of Drawings
                Each Drawing shall be advanced in the Base Currency. Each Drawing
                shall be
                advanced on a Business Day, provided that the Borrower shall have
                given to
                the Agent not more than ten and not fewer than three Business Days'
                notice
                in writing materially in the form set out in Schedule 4 of the required
                Advance Date of the Drawing in question and provided that the requested
                Drawing would not cause a breach of Clause 2.5. Each Drawdown Notice
                once
                given shall be irrevocable and shall constitute a warranty by the
                Borrower
                that:- 

            

    

     

    
      	 	
              2.3.1

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

            

    

     

    
      	 	
              2.3.2

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

            

    

     

    
      	 	
              2.3.3

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

            

    

     

    The
      Agent
      shall promptly notify each Bank of the receipt of each Drawdown Notice,
      following which each Bank will make its Proportionate Share of the amount of
      the
      requested Drawing available to the Borrower through the Agent on the Advance
      Date requested.

     

    2.4 Facility
      Reduction

     

    
      	 	
              2.4.1

            	
              The
                aggregate amount of the Facility available to the Borrower for drawing
                under this Agreement shall be thirty million Dollars ($30,000,000)
                during
                the period from the Execution Date until the First Reduction Date.
                On the
                First Reduction Date and on each of the Subsequent Reduction Dates
                the
                amount of the Facility available for drawing shall be reduced by
                two
                million five hundred thousand Dollars ($2,500,000), which shall leave
                the
                Final Balloon Payment as being payable on the Termination Date. On
                the
                Termination Date the Facility available shall be reduced to zero.
                Subject
                to the proviso hereto, the mandatory reductions in the amount of
                the
                Facility available for drawing 

            

    

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

    required
      pursuant to this Clause will be made in the amounts and at the times specified
      whether or not the Maximum Facility Amount is reduced pursuant to Clause 2.4.2,
      Clause 2.4.3, Clause 2.4.4, Clause 15.7 or Clause 15.8. PROVIDED
      ALWAYS THAT
      any
      mandatory reductions pursuant to Clause 2.4.2 (voluntary reductions), Clause
      2.4.3 (sale) or Clause 2.4.4 (Total Loss) shall be applied to the remaining
      mandatory reductions hereunder on a pro rata basis.

     

    
      	 	
              2.4.2

            	
              The
                Borrower may voluntarily cancel the Maximum Facility Amount in whole
                or in
                part in an amount of not less than five million Dollars ($5,000,000)
                and
                shall be in integral multiples of one million Dollars ($1,000,000),
                provided that it has first given to the Agent not fewer than five
                (5)
                Business Days' prior written notice expiring on a Business Day (the
                "Cancellation
                Date")
                of its desire to reduce the Maximum Facility Amount. Such notice,
                once
                received by the Agent, shall be irrevocable and shall oblige the
                Borrower
                to make payment of all interest and Commitment Commission accrued
                on the
                amount so cancelled up to and including the Cancellation Date together
                with any Break Costs in respect of such cancelled amount if the
                Cancellation Date is not an Interest Payment Date. Any such reduction
                in
                the Maximum Facility Amount:

            

    

     

    (a) shall
      not
      be reversed; and 

     

    (b) shall
      be
      applied against the Final Balloon Payment, and the Final Balloon Payment shall
      be reduced by the same amount as any such reduction of the Maximum Facility
      Amount. 

     

    2.4.3 In
      the
      event of a sale or disposal of a Vessel, if the aggregate Valuation of the
      remainder of the Vessels is less than one hundred and seventy five per cent
      (175%) of the Maximum Facility Amount, then the whole of the net sales proceeds
      shall be applied as a mandatory prepayment and the Maximum Facility Amount
      shall
      be reduced by an amount equal to such prepayment. Such reduction shall be made
      on the date of such sale or disposal. If the aggregate Valuation of the
      remainder of the Vessels is between one hundred and seventy five per cent (175%)
      and two hundred per cent (200%) of the Maximum Facility Amount, then no
      prepayment shall be required and there shall be no reduction to the Maximum
      Facility 

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

    Amount
      until such time as seven million five hundred thousand Dollars ($7,500,000)
      has
      been released under this Clause 2.4.3 when aggregated with those amounts
      similarly released under Clause 2.4.4, whereupon the whole of any further net
      sales proceeds shall be applied as a mandatory prepayment and the Maximum
      Facility Amount shall be reduced by an amount equal to such prepayment. If
      the
      aggregate Valuation of the remainder of the Vessels is above two hundred per
      cent (200%) of the Maximum Facility Amount then no prepayment shall be required
      and there shall be no reduction to the Maximum Facility Amount. In each case,
      the Valuations used shall be that attached to the then most recently delivered
      Compliance Certificate. Any such prepayment shall oblige the Borrower to make
      payment of all interest and Commitment Commission accrued on the amount so
      reduced up to and including the date of reduction together with any Break Costs
      in respect of such reduced amount if the date of such reduction is not an
      Interest Payment Date. Any such reduction in the Maximum Facility Amount:

     

    (a) shall
      not
      be reversed; and 

     

    (b) shall
      be
      applied against the Final Balloon Payment, and the Final Balloon Payment shall
      be reduced by the same amount as any such reduction of the Maximum Facility
      Amount. 

     

    
      	 	
              2.4.4

            	
              In
                the event that a Vessel becomes a Total Loss, on the earlier to occur
                of
                (a) the date of receipt of the proceeds of the Total Loss and (b)
                the date
                falling one hundred and eighty (180) days after the occurrence of
                the
                Total Loss (the "Reduction
                Date"),
                if the aggregate Valuation of the remainder of the Vessels is less
                than
                one hundred and seventy five per cent (175%) of the Maximum Facility
                Amount then the whole of any total loss proceeds shall be applied
                as a
                mandatory prepayment and the Maximum Facility Amount shall be reduced
                by
                an amount equal to such prepayment. If the aggregate Valuation of
                the
                remainder of the Vessels is between one hundred and seventy five
                per cent
                (175%) and two hundred per cent (200%) of the Maximum Facility Amount,
                then no prepayment shall be required and there shall be no reduction
                to
                the Maximum Facility Amount until such time as seven million five
                hundred
                thousand Dollars 

            

    

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

    ($7,500,000)
      has been released under this Clause 2.4.4 when aggregated with those amounts
      similarly released under Clause 2.4.3, whereupon the whole of any further total
      loss proceeds shall be applied as a mandatory prepayment and the Maximum
      Facility Amount shall be reduced by an amount equal to such prepayment. If
      the
      aggregate Valuation of the remainder of the Vessels is above two hundred per
      cent (200%) of the Maximum Facility Amount, then no prepayment shall be required
      and there shall be no reduction to the Maximum Facility Amount. In each case,
      the Valuation used shall be that attached to the then most recently delivered
      Compliance Certificate. Any such prepayment shall oblige the Borrower to make
      payment of all interest and Commitment Commission accrued on the amount so
      reduced up to and including the date of reduction together with any Break Costs
      in respect of such reduced amount if the date of such reduction is not an
      Interest Payment Date. Any such reduction in the Maximum Facility Amount:

     

    (a) shall
      not
      be reversed; and 

     

    (b) shall
      be
      applied against the Final Balloon Payment, and the Final Balloon Payment shall
      be reduced by the same amount as any such reduction of the Maximum Facility
      Amount. 

     

    
      	 	
              2.4.5

            	
              To
                the extent that repayments or prepayments made by the Borrower to
                the
                Agent in accordance with this Agreement reduce the Facility Outstandings
                to less than the Maximum Facility Amount, the Borrower shall again
                be
                entitled to make Drawings up to the Commitment Termination Date in
                accordance with and subject to the terms of this Agreement. Any part
                of
                the Facility which is undrawn on the Commitment Termination Date
                shall be
                automatically cancelled.

            

    

     

    
      	 	
              2.4.6

            	
              Simultaneously
                with each reduction of the Maximum Facility Amount in accordance
                with
                Clause 2.4.1, Clause 2.4.2, Clause 2.4.3 or Clause 2.4.4, (as the
                case may
                be), the Commitment of each Bank will reduce so that the Commitments
                of
                the Banks in respect of the reduced Maximum Facility Amount remain
                in
                accordance with their respective Proportionate
                Shares.

            

    

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

    
      	 	
              2.5

            	
              Restrictions
                on Drawings
                The Borrower shall not be entitled to make more than one Drawing
                on any
                Business Day and no more than five (5) Drawings may be outstanding
                at any
                one time during the Facility Period. Each Drawing shall be of an
                amount of
                not less than four million Dollars ($4,000,000) and shall be in integral
                multiples of one million Dollars ($1,000,000), or the equivalent
                in an
                Optional Currency. If at any time during the Facility Period the
                Facility
                Outstandings exceed the Maximum Facility Amount then available or
                if a
                proposed Drawing added to the Facility Outstandings would result
                in the
                Maximum Facility Amount being exceeded then the Borrower shall immediately
                pay to the Agent on behalf of the Banks such amounts as will ensure
                that
                the Facility Outstandings are equal to or less than the Maximum Facility
                Amount then available. 

            

    

     

    
      	 	
              2.6

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

            

    

     

    
      	 	
              2.7

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

            

    

     

    
      	 	
              2.8

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

            

    

     

    
      	 	
              2.9

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

            

    

     

    
      	 	
              2.10

            	
              Substitute
                Vessels
                It
                is agreed and acknowledged that the Borrower may request amendments
                to the
                list of Vessels set out at Schedule 2. Any such request shall be
                considered by the Banks acting reasonably, and subject
                to:

            

    

     

    2.10.1 the
      Banks
      being satisfied that the replacement vessels are:

     

    (i) offshore
      PSVs or AHTSs of the Borrower's usual standard and quality;

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

    (ii) registered
      in an acceptable registry and classed with a Pre-Approved Classification
      Society;

     

    (iii) built
      no
      earlier than 1996 and being no more than two (2) years older than the Vessel
      it
      is to replace;

     

    (iv) have
      a
      Valuation no less than eighty per cent (80%) of the Valuation of the Vessel
      to
      be replaced;

     

    2.10.2 the
      Borrower, as owner of the replacement vessel, granting security over such
      replacement vessel equivalent to the other Security Documents; and

     

    2.10.3 the
      Agent
      receiving such conditions precedent (including but not limited to corporate
      papers and legal opinions) as it may reasonably require,

     

    the
      Banks
      shall consent to such substitutions and the definition of "Vessels"
      shall
      be amended accordingly.

     

    
      	3  	
              Conditions Precedent and Subsequent 

            

    

     

    
      	 	
              3.1

            	
              Conditions
                Precedent
                -
                First
                Drawing Before
                any Bank shall have any obligation to advance the first Drawing under
                the
                Facility, the Borrower shall pay to the Agent the relevant fees referred
                to in Clause 7 and deliver or cause to be delivered to or to the
                order of
                the Agent the following documents and
                evidence:-

            

    

     

    
      	 	
              3.1.1

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

            

    

     

    
      	 	
              3.1.2

            	
              Corporate
                authorities A
                copy, certified by a director or any duly authorised officer of the
                Security Party in question as true, complete, accurate and neither
                amended
                nor revoked, of a resolution of the directors

            

    

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

    of
      each
      Security Party (together, where appropriate, with signed waivers of notice
      of
      any directors' meetings) approving, and authorising or ratifying the execution
      of, those of the Security Documents to which that Security Party is or is
      intended to be a party and all matters incidental thereto. 

     

    
      	 	
              3.1.3

            	
              Officer's
                certificate A
                certificate (i) signed by a duly authorised officer or representative
                of
                each of the Security Parties setting out the names of the directors
                and
                officers of that Security Party and (ii) issued by each Security
                Party's
                company registry confirming due incorporation and valid existence
                and
                (when such information is maintained by the registry) the names of
                its
                directors and shareholders.

            

    

     

    
      	 	
              3.1.4

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

            

    

     

    
      	 	
              3.1.5

            	
              The
                Security Documents The
                Security Documents, together with all notices and other documents
                required
                by any of them, duly executed.

            

    

     

    
      	 	
              3.1.6

            	
              Drawdown
                Notice A
                duly completed Drawdown Notice.

            

    

     

    
      	 	
              3.1.7

            	
              Process
                agent A
                letter from Gulf Offshore N.S. Limited accepting their appointment
                by each
                of the Security Parties as agent for service of Proceedings pursuant
                to
                the Security Documents.

            

    

     

    
      	 	
              3.1.8

            	
              Legal
                opinions Confirmation
                satisfactory to the Agent that all legal opinions required by the
                Agent
                and the Finance Parties will be given substantially in the form required
                by the Agent and the Finance
                Parties.

            

    

     

    
      	 	
              3.1.9

            	
              Consents
                A
                certificate from the Borrower that all (if any) consents, licences,
                approvals and authorisations of, or registrations with or declarations
                to,
                any governmental authority, bureau or agency which may be required
                in
                connection with the Security Documents have been made or obtained
                and
                remain in full force and effect.

            

    

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

    

    
      	 	
              3.1.10

            	
              Fee
                Letter The
                Fee Letter duly signed and payment of all fees that have fallen due
                thereunder.

            

    

     

    
      	 	
              3.1.11

            	
              Accounts
                The
                audited consolidated accounts for the Guarantor for the year ended
                 2005.

            

    

     

    
      	 	
              3.1.12

            	
              Evidence
                of Borrower's title Evidence
                that on the date of the Drawing (i) the Vessels are registered under
                the
                flag stated in Schedule 2 in the ownership of the Borrower and (ii)
                the
                relevant Mortgages will be capable of being immediately registered
                against
                the Vessels with first priority.

            

    

     

    
      	 	
              3.1.13

            	
              Evidence
                of insurance Evidence
                that the Vessels are insured in the manner required by the Security
                Documents and that letters of undertaking will be issued in the manner
                required by the Security Documents, together with a written opinion
                on the
                Insurances from an insurance adviser appointed by the
                Agent.

            

    

     

    
      	 	
              3.1.14

            	
              Confirmation
                of class A Certificate
                of Confirmation of Class for hull and machinery confirming that the
                Vessels are classed with the highest class applicable to vessels
                of her
                type with a Pre-Approved Classification
                Society.

            

    

     

    
      	 	
              3.1.15

            	
              Vessel
                Documents Photocopies,
                certified as true, accurate and complete by an authorised signatory
                of the
                Borrower, of:

            

    

     

    (i) current
      SMC of each of the Vessels; and

     

    (ii) each
      ISM
      Company's current DOC,

     

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

            

    

     

    
      	 	
              3.2

            	
              Conditions
                Precedent
                -
                Subsequent
                Drawings Before
                any Bank shall have any obligation to advance any subsequent Drawings
                under the Facility, the Borrower shall deliver or cause to be delivered
                to
                the order of the Agent:

            

    

     

    3.2.1 Officer's
      certificate
      A
      certificate signed by a duly authorised officer of each Security Party dated
      no
      later than five (5) Business Days before the date of the Drawing confirming
      that
      none of the documents and evidence delivered to the Agent pursuant to Clauses
      3.1.1, 3.1.2, 3.1.3 and 3.1.4 

     

    
      
        
        

      

      
        29

        
          

        

      

      
        
        

      

    

    has
      been
      amended, modified or revoked in any way since its delivery to the Agent.

     

    3.2.2 Drawdown
      Notice
      Drawdown
      Notice.

     

    3.3 Conditions
      Subsequent
      The
      Borrower undertakes to deliver or to cause to be delivered to the Agent on,
      or,
      in respect of Clause 3.3.1 not later than ten (10) days, or in respect of Clause
      3.3.2 not later than fifteen (15) Business Days, or such other period as the
      Agent may have consented to after the first Advance Date the following
      additional documents and evidence:-

     

    
      	 	
              3.3.1

            	
              Letters
                of undertaking
                Letters of undertaking in respect of the Insurances as required by
                the
                Security Documents together with copies of the relevant policies
                or cover
                notes or entry certificates duly endorsed with the interest of the
                Agent.
                

            

    

     

    
      	 	
              3.3.2

            	
              Evidence
                of Borrower's title
                Certificates of ownership and encumbrance (or equivalent) issued
                by the
                Registrar of Ships (or equivalent official) of the relevant Vessel's
                flag
                state confirming that (a) the Vessels are permanently registered
                under
                that flag in the ownership of the Borrower (b) the Mortgages have
                been
                registered with first priority against the Vessels and (c) there
                are no
                further Encumbrances registered against the
                Vessels.

            

    

     

    
      	 	
              3.4

            	
              No
                waiver If
                the Banks in their sole discretion agree to advance any part of the
                Facility to the Borrower before all of the documents and evidence
                required
                by Clause 3.1 or Clause 3.2 (as the case may be) have been delivered
                to or
                to the order of the Agent, the Borrower undertakes to deliver all
                outstanding documents and evidence to or to the order of the Agent
                no
                later than the date agreed by the Agent and the Borrower and the
                advance
                of any part of the Facility shall not be taken as a waiver of the
                Agent's
                right to require production of all the documents and evidence required
                by
                Clause 3.1 or Clause 3.2 (as the case may
                be).

            

    

     

    
      	 	
              3.5

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

            

    

     

    
      	 	
              3.5.1

            	
              be
                in form and substance reasonably acceptable to the Agent;
                

            

    

     

    
      
        
        

      

      
        30

        
          

        

      

      
        
        

      

    

    
      	 	
              3.5.2

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

            

    

     

    
      	 	
              3.5.3

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

            

    

     

    
      	4  	
              Representations
                and Warranties

            

    

     

    The
      Borrower represents and warrants to each of the Finance Parties at the Execution
      Date and (by reference to the facts and circumstances then pertaining) at the
      date of each Drawdown Notice, at each Advance Date and at each Interest Payment
      Date as follows (except that the representation and warranty contained at Clause
      4.17 shall only be made on the first Advance Date and that the representation
      and warranty contained at Clause 4.9 shall only be made on the Execution Date)
      :-

     

    
      	 	
              4.1

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

            

    

     

    
      	 	
              4.2

            	
              Solvency
                None
                of the Security Parties is insolvent or in liquidation or administration
                or subject to any other insolvency procedure, and no receiver,
                administrative receiver, administrator, liquidator, trustee or analogous
                officer has been appointed in respect of any of the Security Parties.
                For
                this purpose a Security Party will be deemed insolvent if it is unable
                to
                pay its debts within the meaning of S.123 of the Insolvency Act
                1986.

            

    

     

    
      	 	
              4.3

            	
              Binding
                obligations The
                Security Documents when duly executed and delivered will constitute
                the
                legal, valid and binding obligations of the Security Parties enforceable
                in accordance with their respective terms subject to applicable laws
                regarding creditors' rights in
                general.

            

    

     

    
      
        
        

      

      
        31

        
          

        

      

      
        
        

      

    

    
      	 	
              4.4

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

            

    

     

    
      	 	
              4.5

            	
              Registrations
                and consents All
                (if any) consents, licences, approvals and authorisations of, or
                registrations with or declarations to, any governmental authority,
                bureau
                or agency which may be required in connection with the execution,
                delivery, performance, validity or enforceability of the Security
                Documents have been obtained or made and remain in full force and
                effect
                and the Borrower is not aware of any event or circumstance which
                could
                reasonably be expected adversely to affect the right of any of the
                Security Parties to hold and/or obtain renewal of any such consents,
                licences, approvals or
                authorisations.

            

    

     

    
      	 	
              4.6

            	
              Disclosure
                of material facts The
                Borrower is not aware of any material facts or circumstances which
                have
                not been disclosed to the Agent and which might, if disclosed, have
                reasonably been expected to adversely affect the decision of a person
                considering whether or not to make facilities of the nature contemplated
                by this Agreement available to the
                Borrower.

            

    

     

    
      	 	
              4.7

            	
              No
                material litigation There
                is no action, suit, arbitration or administrative proceeding nor
                any
                contemplated action, suit, arbitration or administrative proceeding
                pending or to its knowledge about to be pursued before any court,
                tribunal
                or governmental or other authority which is not covered by adequate
                insurance which would, or would be likely to, have a Material Adverse
                Effect.

            

    

     

    
      	 	
              4.8

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

            

    

     

    
      
        
        

      

      
        32

        
          

        

      

      
        
        

      

    

    
      	 	
              4.9

            	
              No
                deductions
                To
                the best of its knowledge belief and without undue enquiry, none
                of the
                Security Parties is required to make any deduction or withholding
                from any
                payment which it may be obliged to make to any of the Finance Parties
                under or pursuant to the Security
                Documents.

            

    

     

    
      	 	
              4.10

            	
              Use
                of Facility
                The Facility will be used for the purpose specified in the
                recital.

            

    

     

    
      	 	
              4.11

            	
              Material
                Adverse Change
                There has been no change in the business, assets, operations or condition
                (financial or otherwise) of any of the Security Parties or in the
                facts
                and information regarding such entities as represented to date which
                constitutes a Material Adverse
                Effect.

            

    

     

    
      	 	
              4.12

            	
              No
                default
                None of the Security Parties is in default of its obligations under
                any
                other financing documents to which it is a party to an extent or
                in a
                manner which might have a Material Adverse Effect on the business
                or
                condition (financial or otherwise) of that Security Party and no
                Event of
                Default is continuing or might reasonably be expected to result from
                the
                advance of any Drawing.

            

    

     

    
      	 	
              4.13

            	
              Pari
                passu ranking
                The payment obligations of each of the Security Parties under the
                Security
                Documents to which it is a party rank at least pari passu with the
                claims
                of all its other unsecured and unsubordinated creditors, except for
                obligations mandatorily preferred by law applying to companies
                incorporated in the relevant Security Party's country of incorporation
                or
                otherwise applicable to that Security
                Party.

            

    

     

    
      	 	
              4.14

            	
              No
                Immunity
                In
                any proceedings taken in any of the Security Parties' respective
                jurisdictions of incorporation in relation to any of the Security
                Documents, none of the Security Parties will be entitled to claim
                for
                itself or any of its assets immunity from suit, execution, attachment
                or
                other legal process.

            

    

     

    
      	 	
              4.15

            	
              Governing
                Law and Judgments
                In
                any proceedings taken in any of the Security Parties' jurisdiction
                of
                incorporation or organisation in relation to any of the Security
                Documents
                in which there is an express choice of the law, the submission to
                that
                jurisdiction of a particular country as the governing law thereof,
                that
                choice of law and any judgment or (if applicable) arbitral award
                obtained
                in that country will be recognised and
                enforced.

            

    

     

    
      
        
        

      

      
        33

        
          

        

      

      
        
        

      

    

    
      	 	
              4.16

            	
              Validity
                and Admissibility in Evidence
                As
                at the date hereof, all acts, conditions and things required to be
                done,
                fulfilled and performed in order (a) to enable each of the Security
                Parties lawfully to enter into, exercise its rights under and perform
                and
                comply with the obligations expressed to be assumed by it in the
                Security
                Documents, (b) to ensure that the obligations expressed to be assumed
                by
                each of the Security Parties in the Security Documents are legal,
                valid
                and binding and (c) to make the Security Documents admissible in
                evidence
                in the jurisdictions of incorporation or organization of each of
                the
                Security Parties, have been done, fulfilled and
                performed.

            

    

     

    
      	 	
              4.17

            	
              No
                Filing or Stamp Taxes Under
                the laws of the Security Parties' respective jurisdictions of
                incorporation or organisation in force at the date hereof, it is
                not
                necessary that any of the Security Documents be filed, recorded or
                enrolled with any court or other authority in its jurisdiction of
                incorporation or organisation (other than the Registrar of Companies
                for
                England and Wales, or the maritime registry in Norway, to the extent
                applicable) or that any stamp, registration or similar tax be paid
                on or
                in relation to any of the Security
                Documents.

            

    

     

    
      	 	
              4.18

            	
              Accounts
                The
                first set of Accounts and all other annual financial statements relating
                to the Group required to be delivered, were prepared in accordance
                with
                GAAP, give (in conjunction with the notes thereto) a true and fair
                view of
                (in the case of annual financial statements) or fairly represent
                (in the
                case of quarterly accounts) the financial condition of the Group
                at the
                date as of which they were prepared and the results of the Group’s
                operations during the financial period then
                ended.

            

    

     

    
      	 	
              4.19

            	
              Ownership
                and Security
                Each of the Security Parties is the legal and beneficial owner of
                all
                assets and other property which it purports to charge, mortgage,
                pledge,
                assign or otherwise secure pursuant to each Security Document and
                those
                Security Documents to which it is a party create and give rise to
                valid
                and effective Security having the ranking expressed in those Security
                Documents.

            

    

     

    4.20 Money
      Laundering Any
      amount borrowed hereunder, and the performance of the obligations of the
      Security Parties under the Security Documents, will be for the account of
      members of the Group and will not involve any breach by any of them of any
      law
      or regulatory measure relating to "money laundering" as defined 

     

    
      
        
        

      

      
        34

        
          

        

      

      
        
        

      

    

    in
      Article 1 of the Directive (91/308/EEC) of the Council of the European
      Communities.

     

    
      	5  	
              Repayment,
                Prepayment
                and Currency Option

            

    

     

    
      	 	
              5.1

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

            

    

     

    
      	 	
              5.2

            	
              Prepayment
                The
                Borrower may prepay the Facility Outstandings in whole or in part
                in
                integral multiples of one million Dollars ($1,000,000) (or as otherwise
                may be agreed by the Agent), each such prepayment to be of a minimum
                amount of five million Dollars ($5,000,000), provided that it has
                first
                given to the Agent not fewer than five (5) days prior written notice
                expiring on a Business Day of its intention to do so. Any notice
                pursuant
                to this Clause 5.2 once given shall be irrevocable and shall oblige
                the
                Borrower to make the prepayment referred to in the notice on the
                Business
                Day specified in the notice, together with all interest accrued on
                the
                amount prepaid up to and including that Business
                Day.

            

    

     

    
      	 	
              5.3

            	
              Mandatory
                Prepayment If
                at any time the Facility Outstandings shall exceed the Maximum Facility
                Amount the Borrower shall immediately prepay to the Agent on behalf
                of the
                Banks such amounts as will ensure that the Facility Outstandings
                do not
                exceed the Maximum Facility Amount and shall pay to the Banks all interest
                accrued on the amount prepaid up to and including the date on which
                such
                prepayment occurred.

            

    

     

    
      	 	
              5.4

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

            

    

     

    
      
        
        

      

      
        35

        
          

        

      

      
        
        

      

    

    
      	 	
              5.5

            	
              Application
                of prepayments Any
                prepayment by the Borrower in an amount less than the Indebtedness
                shall
                be applied in satisfaction or reduction first of any costs and other
                expenses outstanding; secondly of all interest accrued with respect
                to the
                outstanding Drawings; and thirdly of the outstanding
                Drawings.

            

    

     

    
      	 	
              5.6

            	
              Reborrowing
                of prepayments Any
                amount prepaid pursuant to this Agreement, which for the avoidance
                of
                doubt shall exclude any amount prepaid pursuant to Clause 2.4.2,
                Clause
                2.4.3 or Clause 2.4.4, may be reborrowed in accordance with Clause
                2.2.

            

    

     

    
      	 	
              5.7

            	
              Selection
                of currency The
                Borrower may from time to time select in a written notice to the
                Agent
                given not later than 11.00am on the Quotation Day for the relevant
                Interest Period that the Facility shall be denominated for the next
                Interest Period (which may include the first Interest Period) in
                an
                Optional Currency.

            

    

     

    
      	 	
              5.8

            	
              Unavailability
                of a currency If:

            

    

     

    5.8.1 a
      Bank
      notifies the Agent that the Optional Currency requested is not readily available
      to it in the amount required; or 

     

    5.8.2 a
      Bank
      notifies the Agent that to make an advance in that Optional Currency would
      contravene a law or regulation applicable to it,

     

    the
      Agent
      will promptly give notice to the Borrower to that effect. In this event any
      Bank
      that gives notice pursuant to this Clause 5.8 will be required to
      participate in the Facility during the relevant Interest Period in the Base
      Currency (in an amount equal to that Bank's proportion of the Base Currency
      Amount) and its participation will be treated as a separate Facility denominated
      in the Base Currency during that Interest Period.

     

    5.9 Change
      of currency If
      the
      Facility is to be denominated in different currencies during two successive
      Interest Periods:

     

    5.9.1 the
      following provisions shall apply:

     

    (a) if
      the
      currency for the second Interest Period is an Optional Currency, the amount
      of
      the Facility in that Optional Currency will be calculated by the Agent as the
      amount of that Optional Currency equal to the Base Currency Amount of the
      Facility at the

     

    
      
        
        

      

      
        36

        
          

        

      

      
        
        

      

    

    Agent's
      Spot Rate of Exchange two (2) Business Days before the first day of the second
      Interest Period;

     

    (b) if
      the
      currency for the second Interest Period is the Base Currency, the amount of
      the
      Facility will be equal to the Base Currency Amount;

     

    (c) the
      Borrower shall repay the Facility on the last day of the first Interest Period
      in the currency in which it was denominated for that Interest Period;
      and

     

    (d) the
      Banks
      shall re-advance the Facility in the new currency in accordance with Clause
      5.10;

     

    5.9.2 the
      Agent
      shall:

     

    (a) apply
      the
      amount to be readvanced by the Banks under Clause 5.9.1(d) (or so much of that
      amount as is necessary) in or towards the purchase of an amount in the currency
      in which the Facility is outstanding for the first Interest Period;
      and

     

    (b) use
      the
      amount it purchases in or towards satisfaction of the Borrower's obligations
      under Clause 5.9.1(c);

     

    5.9.3 if
      the
      amount purchased by the Agent under Clause 5.9.2(a) is less than the amount
      required to be repaid by the Borrower, the Agent shall promptly notify the
      Borrower and the Borrower shall, on the last day of the first Interest Period,
      pay an amount to the Agent (for the account of the Banks) (in the currency
      of
      the Facility for the first Interest Period) equal to the
      difference;

     

    5.9.4 if
      any
      part of the amount to be readvanced by the Banks under Clause 5.9.1(d) is not
      needed to purchase the amount required to be repaid by the Borrower, the Agent
      shall promptly notify the Borrower and pay the Borrower on the last day of
      the
      first Interest Period that part of that amount (in the new
      currency).

     

    5.10 Same
      Optional Currency during successive Interest Periods If
      the
      Facility is to be denominated in the same Optional Currency during two
      successive Interest 

     

    
      
        
        

      

      
        37

        
          

        

      

      
        
        

      

    

    Periods,
      the Agent shall calculate the amount of the Facility in the Optional Currency
      for the second of those Interest Periods (by calculating the amount of Optional
      Currency equal to the Base Currency Amount of the Facility at the Agent's Spot
      Rate of Exchange two (2) Business Days before the first day of the second
      Interest Period) and (subject to Clause 5.10.2):

     

    (i) if
      the
      amount calculated is less than the existing amount of the Facility in the
      Optional Currency during the first Interest Period, promptly notify the Borrower
      and the Borrower shall pay to the Agent (for the account of the Banks), on
      the
      last day of the first Interest Period, an amount equal to the difference;
      or

     

    (ii) if
      the
      amount calculated is more than the existing amount of the Facility in the
      Optional Currency during the first Interest Period, if no Event of Default
      is
      continuing, each Bank shall, on the last day of the first Interest Period,
      pay
      to the Borrower through the Agent its participation in an amount equal to the
      difference;

     

    
      	 	
              5.11

            	
              Agent's
                calculations All
                calculations made by the Agent under this Clause 5 will take into
                account
                any repayment or prepayment of the Facility to be made on the last
                day of
                the first Interest Period.

            

    

     

    
      	6  	
              Interest

            

    

     

    
      	 	
              6.1

            	
              Interest
                Periods
                The period during which any Drawing shall be outstanding pursuant
                to this
                Agreement shall be divided into consecutive Interest Periods of one,
                three
                or six months' duration, as selected by the Borrower by written notice
                to
                the Agent not later than 3:00 p.m. on the fourth Business Day before
                the
                beginning of the Interest Period in question, or such other duration
                as
                may be agreed by the Banks in their discretion. No more than three
                one (1)
                month Interest Periods may be selected by the Borrower in each twelve
                (12)
                month period during the Facility
                Period.

            

    

     

    
      	 	
              6.2

            	
              Beginning
                and end of Interest Periods The
                first Interest Period in respect of each Drawing shall begin on the
                Advance Date of that Drawing and shall end on the last day of the
                Interest
                Period selected in accordance with Clause 6.1. Any subsequent Interest
                Period selected in respect of each Drawing shall commence
                

            

    

     

    
      
        
        

      

      
        38

        
          

        

      

      
        
        

      

    

    on
      the
      day following the last day of its previous Interest Period and shall end on
      the
      last day of its current Interest Period selected in accordance with Clause
      6.1.
      However, in respect of any Drawings outstanding on the Termination Date, the
      Interest Period applicable to such Drawings shall end on the Termination
      Date.

     

    
      	 	
              6.3

            	
              Interest
                rate
                During each Interest Period, interest shall accrue on each Drawing
                at the
                rate determined by the Agent to be the aggregate of (a) the Margin
                (b)
                LIBOR (or, if the Facility is denominated in Euro, EURIBOR, or, if
                the
                Facility is denominated in NOK, NIBOR) and (c), if applicable, the
                Mandatory Cost determined at or about 11.00 a.m. (London time) on
                the
                second Business Day prior to the beginning of the Interest Period
                relating
                to that Drawing. The effective interest rate is as is more fully
                described
                in Schedule 7.

            

    

     

    
      	 	
              6.4

            	
              Accrual
                and payment of interest During
                the Facility Period, interest
                shall accrue from day to day, shall be calculated on the basis of
                a 360
                day year (or, for any period when the Facility is denominated in
                Sterling
                on the basis of a 365 day year) and the actual number of days elapsed
                (or,
                in any circumstance where market practice differs, in accordance
                with the
                prevailing market practice) and shall be paid by the Borrower to
                the Agent
                on behalf of the Banks on the last day of each Interest Period and
                additionally, during any Interest Period exceeding six months, on the
                last day of each successive six month period after the beginning of
                that Interest Period.

            

    

     

    
      	 	
              6.5

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

            

    

     

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

     

    
      
        
        

      

      
        39

        
          

        

      

      
        
        

      

    

    6.7 Absence
      of quotations
      If LIBOR
      or, if applicable, EURIBOR or NIBOR is to be determined by reference to the
      Reference Banks but a Reference Bank does not supply a quotation by 11.00 am
      (London time) in respect of LIBOR, 11.00 am (Brussels time) in respect of
      EURIBOR or 12.00 pm (Oslo time) in respect NIBOR, the applicable LIBOR, EURIBOR
      or NIBOR shall be determined on the basis of the quotations obtained from such
      other banks as may be appointed by the Agent in consultation with the Borrower.
      

     

    
      	 	
              6.8

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

            

    

     

    
      	7  	
              Fees

            

    

     

    
      	 	
              7.1

            	
              The
                Borrower shall pay to the Agent for distribution to the Banks Commitment
                Commission at the rate of forty per centum (40%) of the applicable
                Margin
                on any undrawn and uncancelled part of the Facility. The Commitment
                Commission will accrue from day to day on the basis of a 360 day
                year and
                the actual number of days elapsed and shall be paid quarterly in
                arrears
                from 15 March 2006 until the Commitment Termination Date with a pro
                rata
                payment being due and payable on the Commitment Termination
                Date.

            

    

     

    
      	 	
              7.2

            	
              The
                Borrower shall pay to the Agent the fees detailed in the Fee
                Letter.

            

    

     

    
      	 	
              7.3

            	
              All
                fees and commissions hereunder or under the Fee Letter shall be calculated
                by reference to, and payable in, the Base
                Currency.

            

    

     

    
      	8  	
              Security
                Documents

            

    

     

    
      	 	
              8.1

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

            

    

     

    
      	 	
              8.1.1

            	
              the
                Mortgages
                the first priority ship mortgages together with collateral declaration
                of
                pledge thereto over each of the Vessels executed by the Borrower.
                

            

    

     

    
      
        
        

      

      
        40

        
          

        

      

      
        
        

      

    

    
      	 	
              8.1.2

            	
              the
                Assignments
                the assignments of the Insurances and Requisition Compensation in
                respect
                of each of the Vessels executed by the Borrower.
                

            

    

     

    
      	 	
              8.1.3

            	
              the
                Guarantee the
                guarantee and indemnity of the Guarantor in favour of the
                Agent.

            

    

     

    
      	9  	
              Agency
                and Trust

            

    

     

    
      	 	
              9.1

            	
              Appointment
                Each
                of the Finance Parties appoints the Agent its agent for the purpose
                of
                administering the Facility and the Security Documents and authorises
                the
                Agent and its directors, officers, employees and agents acting on
                the
                instructions from time to time of the Majority Banks, and subject
                to
                Clauses 9.4 and 9.19, to execute the Security Documents on its behalf
                and
                to exercise all rights, powers, discretions and remedies vested in
                the
                Banks under or pursuant to the Security Documents, together with
                all
                powers reasonably incidental to them.

            

    

     

    
      	 	
              9.2

            	
              Authority
                Each
                of the Finance Parties irrevocably authorises the Agent, acting on
                the
                instructions from time to time of the Majority Banks (save where
                the terms
                of any Security Document expressly require the instructions of all
                of the
                Banks):- 

            

    

     

    
      	 	
              9.2.1

            	
              to
                give or withhold any consents or approvals; and

            

    

     

    
      	 	
              9.2.2

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

            

    

     

    
      	 	
              9.2.3

            	
              to
                collect, receive, release or pay any
                money;

            

    

     

    under
      or
      pursuant to any of the Security Documents. The Agent shall have no duties or
      responsibilities as agent or as security trustee other than those expressly
      conferred on it by the Security Documents and shall not be obliged to act on
      any
      instructions if to do so would, in the opinion of the Agent, be contrary to
      any
      provision of the Security Documents or to any law, or would expose the Agent
      to
      any actual or potential liability to any third party.

     

    
      	 	
              9.3

            	
              Trust
                The
                Agent agrees and declares, and each of the Banks acknowledges, that,
                subject to the terms and conditions of this Clause, the Agent holds
                the
                Trust Property on trust for the Banks, in accordance with their respective
                Proportionate Shares. Each of the Finance Parties agrees that the
                obligations, rights and benefits vested in the Agent in its capacity
                as
                security trustee shall be performed and exercised in accordance with
                this
                Clause. The Agent in its capacity as security

            

    

     

    
      
        
        

      

      
        41

        
          

        

      

      
        
        

      

    

    trustee
      shall have the benefit of all of the provisions of this Agreement benefiting
      it
      in its capacity as agent for the Finance Parties, and all the powers and
      discretions conferred on trustees by the Trustee Act 1925 (to the extent not
      inconsistent with this Agreement). In addition:-

     

    
      	 	
              9.3.1

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

            

    

     

    
      	 	
              9.3.2

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

            

    

     

    
      	 	
              9.3.3

            	
              the
                Agent and the Finance Parties agree that the perpetuity period applicable
                to the trusts declared by this Agreement shall be the period of eighty
                years from the Execution Date.

            

    

     

    9.4 Limitations
      on authority Except
      with the prior written consent of each of the Banks, the Agent shall not be
      entitled to :-

     

    
      	 	
              9.4.1

            	
              release
                or vary any security given for the Borrower's obligations under this
                Agreement; nor

            

    

     

    
      	 	
              9.4.2

            	
              agree
                to waive the payment of any sum of money payable by any of the Security
                Parties under the Security Documents;
                nor

            

    

     

    
      	 	
              9.4.3

            	
              change
                the meaning of the expression "Majority
                Banks";
                nor

            

    

     

    
      
        
        

      

      
        42

        
          

        

      

      
        
        

      

    

    
      	 	
              9.4.4

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

            

    

     

    
      	 	
              9.4.5

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

            

    

     

    
      	 	
              9.4.6

            	
              take
                or refrain from taking any step if the effect of such action or inaction
                may lead to the increase of the obligations of a Bank under any of
                the
                Security Documents; nor

            

    

     

    
      	 	
              9.4.7

            	
              agree
                to change the currency in which any sum is payable under the Security
                Documents; nor

            

    

     

    
      	 	
              9.4.8

            	
              agree
                to amend this Clause 9.4; nor

            

    

     

    
      	 	
              9.4.9

            	
              agree
                to reduce the rate under the definitions of "Margin"
                "Commitment
                Commission"
                or "Default
                Rate".

            

    

     

    
      	 	
              9.5

            	
              Liability
                Neither
                the Agent nor any of its directors, officers, employees or agents
                shall be
                liable to any of the other Finance Parties for anything done or omitted
                to
                be done by the Agent under or in connection with the Security Documents
                unless as a result of the Agent's wilful misconduct or gross
                negligence.

            

    

     

    
      	 	
              9.6

            	
              Acknowledgement
                Each
                of the Finance Parties (other than the Agent) acknowledges that:-
                

            

    

     

    
      	 	
              9.6.1

            	
              it
                has not relied on any representation made by the Agent or any of
                the
                Agent's directors, officers, employees or agents or by any other
                person
                acting or purporting to act on behalf of the Agent to induce it to
                enter
                into any of the Security Documents;

            

    

     

    
      	 	
              9.6.2

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

            

    

     

    
      
        
        

      

      
        43

        
          

        

      

      
        
        

      

    

    
      	 	
              9.6.3

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

            

    

     

    
      	 	
              9.6.4

            	
              the
                Agent shall not have any duty or responsibility at any time to provide
                it
                with any credit or other information relating to any of the Security
                Parties unless that information is received by the Agent pursuant
                to the
                express terms of the Security Documents.

            

    

     

    Each
      of
      the Finance Parties (other than the Agent) agrees that it will not assert nor
      seek to assert against any director, officer, employee or agent of the Agent
      or
      against any other person acting or purporting to act on behalf of the Agent
      any
      claim which it might have against them in respect of any of the matters referred
      to in this Clause.

     

    
      	 	
              9.7

            	
              Limitations
                on responsibility The
                Agent shall have no responsibility to any of the Security Parties
                or to
                any of the other Finance Parties on account of:-
                

            

    

     

    
      	 	
              9.7.1

            	
              the
                failure of any of the Finance Parties or of any of the Security Parties
                to
                perform any of their respective obligations under the Security Documents;
                

            

    

     

    
      	 	
              9.7.2

            	
              the
                financial condition of any of the Security Parties;
                

            

    

     

    
      	 	
              9.7.3

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

            

    

     

    
      	 	
              9.7.4

            	
              the
                negotiation, execution, effectiveness, genuineness, validity,
                enforceability, admissibility in evidence or sufficiency of any of
                the
                Security Documents or of any document executed or delivered pursuant
                to or
                in connection with any of the Security
                Documents.

            

    

     

    9.8 The
      Agent's rights The
      Agent
      may:-

     

    
      	 	
              9.8.1

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

            

    

     

    
      
        
        

      

      
        44

        
          

        

      

      
        
        

      

    

    
      	 	
              9.8.2

            	
              assume
                that no Event of Default or Potential Event of Default has occurred
                unless, in its capacity as the Agent, it has acquired actual knowledge
                to
                the contrary; and 

            

    

     

    
      	 	
              9.8.3

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

            

    

     

    
      	 	
              9.8.4

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

            

    

     

    
      	 	
              9.8.5

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

            

    

     

    
      	 	
              9.8.6

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

            

    

     

    
      	 	
              9.9

            	
              The
                Agent's duties The
                Agent shall:-

            

    

     

    
      	 	
              9.9.1

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

            

    

     

    
      	 	
              9.9.2

            	
              inform
                the Banks promptly of any Event of Default of which the Agent has
                actual
                knowledge.

            

    

     

    
      	 	
              9.10

            	
              No
                deemed knowledge The
                Agent shall not be deemed to have actual knowledge of the falsehood
                or
                incompleteness of any representation or warranty made or deemed repeated
                by any of the Security Parties or actual knowledge of the
                

            

    

     

    
      
        
        

      

      
        45

        
          

        

      

      
        
        

      

    

    occurrence
      of any Event of Default or Potential Event of Default unless a Bank or any
      of
      the Security Parties shall have given written notice thereof to the
      Agent.

     

    
      	 	
              9.11

            	
              Other
                business The
                Agent may, without any liability to account to the Banks, generally
                engage
                in any kind of banking or trust business with any of the Security
                Parties
                or any of their respective Subsidiaries or associated companies or
                with a
                Bank as if it were not the Agent.

            

    

     

    
      	 	
              9.12

            	
              Agent's
                Indemnity The
                Banks shall, promptly on the Agent's request, reimburse the Agent
                in their
                respective Proportionate Shares, for, and keep the Agent fully indemnified
                in respect of:- 

            

    

     

    
      	 	
              9.12.1

            	
              all
                amounts payable by the Borrower to the Agent pursuant to Clause 17
                (other
                than under Clauses 17.3 and 17.4) to the extent that those amounts
                are not
                paid by the Borrower; 

            

    

     

    
      	 	
              9.12.2

            	
              all
                liabilities, damages, costs and claims sustained or incurred by the
                Agent
                in connection with the Security Documents, or the performance of
                its
                duties and obligations, or the exercise of its rights, powers, discretions
                or remedies under or pursuant to any of the Security Documents; or
                in
                connection with any action taken or omitted by the Agent under or
                pursuant
                to any of the Security Documents, unless in any case those liabilities,
                damages, costs or claims arise solely from the Agent's wilful misconduct
                or gross negligence.

            

    

     

    
      	 	
              9.13

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

            

    

     

    
      	 	
              9.14

            	
              Distribution
                of payments The
                Agent shall pay promptly to the order of each of the Banks that Bank's
                Proportionate Share of every sum of money received by the
                

            

    

     

    
      
        
        

      

      
        46

        
          

        

      

      
        
        

      

    

    Agent
      pursuant to the Security Documents (with the exception of any amounts payable
      pursuant to Clause 7 and any amounts which, by the terms of the Security
      Documents, are paid to the Agent for the account of the Agent alone or
      specifically for the account of one or more of the Finance Parties) and until
      so
      paid such amount shall be held by the Agent on trust absolutely for that Finance
      Party.

     

    
      	 	
              9.15

            	
              Reimbursement
                The
                Agent shall have no liability to pay any sum to another Party until
                it has
                itself received payment of that sum. If, however, the Agent does
                pay any
                sum to a Party on account of any amount prospectively due to it pursuant
                to Clause 9.14 or otherwise before it has itself received payment of
                that amount, and the Agent does not in fact receive payment within
                five
                Business Days after the date on which that payment was required to
                be made
                by the terms of the Security Documents, the recipient will, on demand
                by
                the Agent, refund to the Agent an amount equal to the amount received
                by
                it, together with an amount sufficient to reimburse the Agent for
                the cost
                of money for funding the amount in question during the period beginning
                on
                the date on which that amount was required to be paid by the terms
                of the
                Security Documents and ending on the date on which the Agent receives
                reimbursement.

            

    

     

    
      	 	
              9.16

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

            

    

     

    
      	 	
              9.16.1

            	
              that
                Finance Party shall promptly notify the Agent (which shall promptly
                notify
                each other Finance Party);

            

    

     

    
      	 	
              9.16.2

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

            

    

     

    
      	 	
              9.16.3

            	
              the
                Agent shall treat that payment as if it were a payment by the Security
                Party in question on account of the sum owed to the Finance
                

            

    

     

    
      
        
        

      

      
        47

        
          

        

      

      
        
        

      

    

    Parties
      as aforesaid and shall account to the Finance Parties in respect of the Excess
      Amount in accordance with the provisions of this Clause.

     

    However,
      if a Finance Party has commenced any Proceedings to recover sums owing to it
      under the Security Documents and, as a result of, or in connection with, those
      Proceedings has received an Excess Amount, the Agent shall not distribute any
      of
      that Excess Amount to any other Finance Party which had been notified of the
      Proceedings and had the legal right to, but did not, join those Proceedings
      or
      commence and diligently prosecute separate Proceedings to enforce its rights
      in
      the same or another court.

     

    
      	 	
              9.17

            	
              Rescission
                of Excess Amount If
                all or any part of any Excess Amount is rescinded or must otherwise
                be
                restored to any of the Security Parties or to any other third party,
                the
                Finance Parties which have received any part of that Excess Amount
                by way
                of distribution from the Agent pursuant to Clause 9.16 shall repay
                to the
                Agent for the account of the Finance Party which originally received
                or
                recovered the Excess Amount, the amount which shall be necessary
                to ensure
                that all of the Banks share rateably in accordance with their
                Proportionate Shares together with interest on that amount at a rate
                equivalent to that (if any) paid by the Finance Party receiving or
                recovering the Excess Amount to the person to whom that Finance Party
                is
                liable to make payment in respect of such amount, and Clause 9.16.3
                shall
                apply only to the retained amount.

            

    

     

    
      	 	
              9.18

            	
              Proceedings
                Each
                of the Finance Parties shall notify one another of the proposed
                commencement of any Proceedings under any of the Security Documents
                prior
                to their commencement. No such Proceedings may be commenced without
                the
                prior written consent of the Majority
                Banks.

            

    

     

    
      	 	
              9.19

            	
              Instructions
                Where
                the Agent is authorised or directed to act or refrain from acting
                in
                accordance with the instructions of the Banks, or of the Majority
                Banks
                where applicable, each of the Banks shall provide the Agent with
                instructions within five (5) Business Days of the Agent's written
                request
                or such shorter period as the Agent may reasonably specify. If a
                Bank does
                not provide the Agent with instructions within that period, (i) that
                Bank
                shall be bound by the decision of the Agent, (ii) that Bank shall
                have no
                vote for the purposes of this Clause and (iii) the combined Proportionate
                Shares of the other Banks who provided such instructions shall be
                deemed
                to contribute 100%. Nothing in this Clause shall
                

            

    

     

    
      
        
        

      

      
        48

        
          

        

      

      
        
        

      

    

    limit
      the
      right of the Agent to take, or refrain from taking, any action without obtaining
      the instructions of the Banks if the Agent in its discretion considers it
      necessary or appropriate to take, or refrain from taking, such action in order
      to preserve the rights of the Banks under or in connection with the Security
      Documents. In that event, the Agent will notify the Banks of the action taken
      by
      it as soon as reasonably practicable, and the Banks agree to ratify any action
      taken by the Agent pursuant to this Clause.

     

    
      	 	
              9.20

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

            

    

     

    
      	 	
              9.21

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

            

    

     

    
      	 	
              9.22

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

            

    

     

    
      	 	
              9.22.1

            	
              with
                the consent of the Borrower, not to be unreasonably withheld, the
                other
                Finance Parties may within thirty days after the date of the Agent's
                notice appoint a successor to act as agent and/or security trustee
                or, if
                they fail to do so with the consent of the Borrower, not to be
                unreasonably withheld, the Agent may appoint any other bank or financial
                institution as its successor;

            

    

     

    
      	 	
              9.22.2

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

            

    

     

    
      	 	
              9.22.3

            	
              the
                Agent shall thereupon be discharged from all further obligations
                as agent
                and/or security trustee but shall remain entitled to the benefit
                of the
                provisions of this Clause; 

            

    

     

    
      
        
        

      

      
        49

        
          

        

      

      
        
        

      

    

    
      	 	
              9.22.4

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

            

    

     

    
      	 	
              9.23

            	
              No
                fiduciary relationship Except
                as provided in Clauses 9.3 and 9.14, the Agent shall not have any
                fiduciary relationship with or be deemed to be a trustee of or for
                any
                other Finance Party and nothing contained in any of the Security
                Documents
                shall constitute a partnership between any two or more Banks or between
                the Agent and any other Finance
                Party.

            

    

     

    
      	 	
              9.24

            	
              The
                Agent as a Bank The
                expression "the
                Banks"
                when used in the Security Documents includes the Agent in its capacity
                as
                one of the Banks. The Agent shall be entitled to exercise its rights,
                powers, discretions and remedies under or pursuant to the Security
                Documents in its capacity as one of the Banks in the same manner
                as any
                other Bank and as if it were not also the
                Agent.

            

    

     

    
      	 	
              9.25

            	
              The
                Agent as security trustee
                Unless the context otherwise requires, the expression "the
                Agent"
                when used in the Security Documents includes the Agent acting in
                its
                capacities both as agent and security
                trustee.

            

    

     

    
      	10  	
              Covenants

            

    

     

    The
      Borrower covenants with the Finance Parties in the following terms.

     

    
      	 	
              10.1

            	
              Negative
                covenants 

            

    

     

    The
      Borrower will not:-

     

    10.1.1 no
      third party rights without
      the Majority Banks' prior written consent, create or permit to arise or continue
      any Encumbrance on or over all or any part of the Vessels or their respective
      Insurances except for Permitted Liens; nor

     

    10.1.2 no
      other business
      materially change the nature of their business from that of acting as a holding
      company as carried on as at the Execution Date and shall procure that there
      is
      no material change in the nature of the business of the Group as a whole from
      that advised to the Agent of the date of this Agreement; nor

     

    
      
        
        

      

      
        50

        
          

        

      

      
        
        

      

    

    10.1.3 merger
      or amalgamation
      without
      the prior written consent of the Majority Banks, permit any merger or
      amalgamation; nor

     

    10.1.4 no
      change in management
      permit
      anyone other than the Manager to be appointed as commercial or technical
      managers of the Vessels, nor permit any material variation of the arrangements
      for the commercial or technical management of the Vessels, nor permit the
      Manager to sub-contract or delegate a material part of the commercial or
      technical management of any Vessel to any third party.

     

    10.2 Positive
      covenants

     

    
      	 	
              10.2.1

            	
              Financial
                statements The
                Borrower shall procure that the Guarantor shall supply to the Agent
                

            

    

     

    
      	 	
              (a)

            	
              as
                soon as the same become available, but in any event within one hundred
                and
                fifty (150) days after the end of each of its financial years, its
                audited
                consolidated financial statements for that financial
                year;

            

    

     

    
      	 	
              (b)

            	
              as
                soon as the same become available, but in any event within sixty
                (60) days
                of the end of its second quarter in each of its financial years,
                unaudited
                consolidated financial statements for that half
                year;

            

    

     

    
      	 	
              (c)

            	
              as
                soon as they become available, but in any event within one hundred
                and
                fifty (150) days after the end of each of its financial years,
                consolidated financial forecasts for the following two financial
                years.

            

    

     

    
      	 	
              10.2.2

            	
              Requirements
                as to financial statements Each
                set of financial statements delivered by the Guarantor under Clause
                10.2.1:

            

    

     

    
      	 	
              (a)

            	
              shall
                be certified by an officer of the Guarantor to the best of its knowledge
                and belief as fairly representing its financial condition as at the
                date
                as at which those financial statements were drawn up;
                and

            

    

     

    
      
        
        

      

      
        51

        
          

        

      

      
        
        

      

    

    
      	 	
              (b)

            	
              shall
                be prepared using GAAP, accounting practices and financial reference
                periods consistently applied unless, in relation to any set of financial
                statements, the Guarantor notifies the Agent that there has been
                a change
                in GAAP, the accounting practices or reference periods and the Guarantor's
                auditors deliver to the Agent:

            

    

     

    
      	 	
              (i)

            	
              a
                description of any change necessary for those financial statements
                to
                reflect the GAAP, accounting practices and reference periods upon
                which
                the previous financial statements were prepared;
                and

            

    

     

    
      	 	
              (ii)

            	
              sufficient
                information, in form and substance as may be reasonably required
                by the
                Agent, to enable the Agent to make an accurate comparison between
                the
                financial position indicated in those financial statements and that
                indicated in the previous financial statements.

            

    

     

    
      	 	
              10.2.3

            	
              Information:
                miscellaneous The
                Borrower shall supply to the Agent:

            

    

     

    
      	 	
              (a)

            	
              all
                documents dispatched by the Borrower to its creditors generally at
                the
                same time as they are dispatched;

            

    

     

    
      	 	
              (b)

            	
              promptly
                upon becoming aware of them, details of any litigation, arbitration
                or
                administrative proceedings which are current, threatened or pending
                against any Security Party, and which might, if adversely determined,
                have
                a Material Adverse Effect on the ability of a Security Party to perform
                its obligations under the Security Documents or on the validity or
                enforceability of any of the Security Documents; and
                

            

    

     

    
      	 	
              (c)

            	
              promptly,
                such further information regarding the financial condition, business
                and
                operations of any Security Party as the Agent may reasonably request
                including, without limitation, cash flow analyses and details of
                the
                operating costs of each Vessel.

            

    

     

    
      
        
        

      

      
        52

        
          

        

      

      
        
        

      

    

    
      	 	
              10.2.4

            	
              Notification
                of default 

            

    

     

    
      	 	
              (a)

            	
              The
                Borrower shall notify the Agent of any Default (and the steps, if
                any,
                being taken to remedy it) promptly upon becoming aware of its
                occurrence.

            

    

     

    
      	 	
              (b)

            	
              Promptly
                upon a request by the Agent, the Borrower shall supply to the Agent
                a
                certificate signed by two of its directors or senior officers on
                its
                behalf certifying to the best of their knowledge and belief that
                no
                Default is continuing (or if a Default is continuing, specifying
                the
                Default and the steps, if any, being taken to remedy
                it).

            

    

     

    10.2.5 "Know
      your customer" checks If:

     

    
      	 	
              (a)

            	
              the
                introduction of or any change in (or in the interpretation, administration
                or application of) any law or regulation made after the date of this
                Agreement;

            

    

     

    
      	 	
              (b)

            	
              any
                change in the status of the Borrower after the date of this Agreement;
                or

            

    

     

    
      	 	
              (c)

            	
              a
                proposed assignment or transfer by a Bank of any of its rights and
                obligations under this Agreement to a party that is not a Bank prior
                to
                such assignment or transfer,

            

    

     

    obliges
      the Agent or any Bank (or, in the case of (c) above, any prospective new Bank)
      to comply with "know your customer" or similar identification procedures in
      circumstances where the necessary information is not already available to it,
      the Borrower shall promptly upon the request of the Agent or any Bank supply,
      or
      procure the supply of, such documentation and other evidence as is reasonably
      requested by the Agent (for itself or on behalf of any Bank) or any Bank for
      itself (or, in the case of (c) above, on behalf of any prospective new Bank)
      in
      order for the Agent or that Bank (or, in the case of (c) above, any prospective
      new Bank) to carry out and be satisfied it has complied with all necessary
      "know
      your customer" or other similar checks under all applicable laws 

     

    
      
        
        

      

      
        53

        
          

        

      

      
        
        

      

    

    and
      regulations pursuant to the transactions contemplated in the Security
      Documents.

     

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

     

    10.2.7 Corporate
      Existence
      The
      Borrower shall ensure that throughout the Facility Period each of the Security
      Parties shall (i) remain duly formed and validly existing under the laws of
      its
      respective jurisdiction of incorporation (ii) remain authorised to do business
      in the jurisdiction in which it transacts its business (iii) continue to have
      the power to carry on its business as it is now being conducted and to enter
      into and perform its obligations under the Security Documents to which it is
      a
      party and (iv) continue to comply with all laws, statutory, regulatory and
      other
      requirements relative to its business which could reasonably be expected to
      have
      a Material Adverse Effect on its business, assets or operations, financial
      or
      otherwise.

     

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

     

    10.2.9 Registration
      of Vessels
      The
      Borrower undertakes to maintain the registration of the Vessels under the flag
      indicated in Schedule 2, or such other flag requested by the Borrower and is
      consented to by the Banks (such consent not to be unreasonably withheld), for
      the duration of the Facility Period. 

     

    10.2.10 Classification
      The
      Borrower shall ensure that each Vessel maintains the highest classification
      required for the purpose of the relevant trade of such Vessel which shall be
      with a Pre-Approved Classification Society or such 

     

    
      
        
        

      

      
        54

        
          

        

      

      
        
        

      

    

    other
      society as may be acceptable to the Agent, in each case, free from any overdue
      recommendations and conditions affecting the class of that Vessel.

     

    10.2.11 Compliance
      with Applicable Laws
      The
      Borrower shall comply with all applicable laws to which it may be
      subject.

     

    10.2.12 Inspection
      of records
      The
      Borrower will permit the inspection of its financial records and accounts on
      reasonable notice from time to time during business hours by the Agent or its
      nominee. 

     

    10.2.13 Valuations
      The
      Borrower will deliver to the Agent: 

     

    (a) a
      Valuation of each of the Vessels on the due date for delivery of the six monthly
      Compliance Certificate (which shall be at the expense of the Borrower);
      and

     

    (b) on
      such
      other occasions as the Agent may reasonably request (which shall be at the
      expense of the Agent).

     

    10.2.14 Financial
      covenants
      Throughout the Facility Period the Borrower shall procure that the Guarantor
      shall:-

     

    (i) maintain
      a ratio of Total Shareholder Equity to Total Assets of at least thirty five
      per
      cent. (35%); and

     

    (ii) maintain
      a ratio of EBITDA to Interest Expense of no less than 2.25:1.00.

     

    
      	 	
              10.2.15

            	
              Compliance
                Certificates
                The Borrower will produce a Compliance Certificate with each set
                of
                audited consolidated annual accounts and each set of unaudited
                consolidated six monthly accounts.

            

    

     

    
      	 	
              10.2.16

            	
              Additional
                security If
                and so often as the aggregate of: 

            

    

     

    
      	 	
              (i)

            	
              the
                Valuations of the Vessels; and

            

    

     

    
      	 	
              (ii)

            	
              the
                value of any additional security acceptable to the Agent in its absolute
                discretion for the time being provided to the Banks (or to the Agent
                on
                their behalf) pursuant to this Clause (the "Collateral")

            

    

     

    
      
        
        

      

      
        55

        
          

        

      

      
        
        

      

    

    shall
      be
      less than one hundred and forty per cent (140%) of the amount of the Base
      Currency Amount (each being a "Relevant
      Percentage")
      the
      Borrower will, within thirty days of the request of the Agent to do so, at
      the
      Borrower's option:- 

     

    
      	 	
              (a)

            	
              pay
                to the Agent or to its nominee a cash deposit in the amount of the
                shortfall to be secured in favour of the Banks (or of the Agent on
                their
                behalf) as additional security for the payment of the Indebtedness;
                or
                

            

    

     

    
      	 	
              (b)

            	
              give
                to the Banks (or to the Agent on their behalf) other additional security
                as proposed by the Borrower in amount and form acceptable to the
                Banks in
                their reasonable discretion, acting in good faith; or
                

            

    

     

    
      	 	
              (c)

            	
              prepay
                the amount of the Indebtedness which will ensure that the Collateral
                is
                not less than the Relevant
                Percentage.

            

    

     

     

    Clauses 5.3,
      5.4, 5.5 and 5.6 shall apply, mutatis
      mutandis,
      to any
      prepayment made pursuant to this Clause and the value of any additional security
      provided pursuant to this Clause shall be determined by the Agent in its
      discretion after consultation with the Majority Banks. Where the Borrower has
      provided additional security pursuant to this Clause, the Borrower may obtain
      new Valuations (at the Borrower's expense) on a date falling not earlier than
      three (3) months after the date such additional security was provided. If the
      aggregate amount of the Collateral reflecting the new Valuations of the Vessels
      (the "New
      Security Amount")
      is
      greater than the Relevant Percentage then, provided no Event of Default has
      occurred and is continuing, the Agent shall release to the Borrower, upon the
      Borrower's written request and at the Borrower's expense, any part of the
      additional security as the Borrower shall select with the consent of the Agent
      (such consent not to be unreasonably withheld), such that after its release
      the
      New Security Amount will be at least equal to the Relevant
      Percentage.

     

    
      
        
        

      

      
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    10.3 Vessel
      Covenants - Insurance 

     

    
      	 	
              10.3.1

            	
              The
                Borrower covenants to ensure at its own expense throughout the Facility
                Period that:

            

    

     

    
      	 	
              (a)

            	
              the
                Vessels remain insured against marine risks and war risks on an agreed
                value basis for an amount which is the greater from time to time
                of (i)
                ninety per cent (90%) of the most recent Valuation of the Vessels
                and (ii)
                an amount which (when aggregated with the amounts for which any other
                vessels providing first priority security for the Indebtedness are
                insured
                for such risks) equals one hundred and twenty per cent (120%) of
                the
                amount of the Facility Outstandings;
                and

            

    

     

    
      	 	
              (b)

            	
              the
                Vessels remain entered in a protection and indemnity association
                in both
                protection and indemnity classes, or remains otherwise insured against
                protection and indemnity risks and liabilities (including, without
                limitation, protection and indemnity war risks);
                and

            

    

     

    
      	 	
              (c)

            	
              the
                Vessels remain insured against oil pollution caused by such Vessel
                for
                such amounts as the Agent may from time to time approve unless that
                risk
                is covered to the satisfaction of the Agent by each Vessel's protection
                and indemnity entry or insurance.

            

    

     

    
      	 	
              10.3.2

            	
              The
                Agent agrees that, if and for so long as any Vessel may be laid up
                with
                the approval of the Agent, the Borrower may at its own expense take
                out
                port risk insurance on the Vessel in place of hull and machinery
                insurance. 

            

    

     

    
      	 	
              10.3.3

            	
              The
                Borrower undertakes to place the Obligatory Insurances in such markets,
                in
                such currency, on such terms and conditions, and with such brokers,
                underwriters and associations as the Agent shall have previously
                approved
                in writing. The Borrower shall not alter the terms of any of the
                Obligatory Insurances without the prior written consent of the Agent,
                and
                will supply the Agent from time to time on request with such information
                as the Agent may in its discretion require with regard to the Obligatory
                

            

    

     

    
      
        
        

      

      
        57

        
          

        

      

      
        
        

      

    

    Insurances
      and the brokers, underwriters or associations through or with which the
      Obligatory Insurances are placed. The Borrower shall reimburse the Agent on
      demand for all costs and expenses incurred by the Agent in obtaining from time
      to time a report on the adequacy of the Obligatory Insurances from an insurance
      adviser instructed by the Agent.

     

    
      	 	
              10.3.4

            	
              The
                Borrower undertakes duly and punctually to pay all premiums, calls and
                contributions, and all other sums at any time payable in connection
                with
                the Obligatory Insurances, and, at its own expense, to arrange and
                provide
                any guarantees from time to time required by any protection and indemnity
                or war risks association. 

            

    

     

    
      	 	
              10.3.5

            	
              The
                Borrower will comply in all respects with all terms and conditions
                of the
                Obligatory Insurances and will make all such declarations to brokers,
                underwriters and associations as may be required to enable the Vessels
                to
                operate in accordance with the terms and conditions of the Obligatory
                Insurances. The Borrower will not do, nor permit to be done, any
                act, nor
                make, nor permit to be made, any omission, as a result of which any
                of the
                Obligatory Insurances may become liable to be suspended, cancelled
                or
                avoided, or may become unenforceable, or as a result of which any
                sums
                payable under or in connection with any of the Obligatory Insurances
                may
                be reduced or become liable to be repaid or rescinded in whole or
                in part.
                In particular, but without limitation, the Borrower will not permit
                the
                Vessels to be employed other than in conformity with the Obligatory
                Insurances without first taking out additional insurance cover in
                respect
                of that employment in all respects to the satisfaction of the Agent,
                and
                the Borrower will promptly notify the Agent of any new requirement
                imposed
                by any broker, underwriter or association in relation to any of the
                Obligatory Insurances.

            

    

     

    
      	 	
              10.3.6

            	
              The
                Borrower will, at least fourteen (14) days (or such shorter period
                as the
                Agent may from time to time agree) before the expiry of any of the
                Obligatory Insurances, notify the Agent of the names of the brokers
                and/or
                the war risks and protection and indemnity associations proposed
                to be
                employed by the Borrower for the purposes of the renewal of such
                Obligatory Insurances and of the amounts in which such Obligatory
                

            

    

     

    
      
        
        

      

      
        58

        
          

        

      

      
        
        

      

    

    Insurances
      are proposed to be renewed and the risks to be covered and, subject to
      compliance with any requirements of the Agent pursuant to this Clause 10.3.6,
      that the relevant insurance brokers and/or the approved war risks and protection
      and indemnity associations will at least seven (7) days before such expiry
      (or
      within such shorter period as the Agent may from time to time agree) confirm
      in
      writing to the Agent whether or not there are likely to be any changes to the
      names of the brokers and/or war risks and protection and indemnity associations
      and advise when it is expected that such renewals shall be effected in
      accordance with the instructions so given provided always that the renewal
      is
      effected before the relevant current Obligatory Insurances expire.

     

    
      	 	
              10.3.7

            	
              The
                Borrower shall deliver to the Agent certified copies (and, if required
                by
                the Agent, the originals) of all policies, certificates of entry
                and other
                documents relating to the Insurances (including, without limitation,
                receipts for premiums, calls or contributions) and shall procure
                that
                letters of undertaking in such form as the Agent may approve shall
                be
                issued to the Agent by the brokers through which the Insurances are
                placed
                (or, in the case of protection and indemnity or war risks associations,
                by
                their managers). If any Vessel is at any time during the Facility
                Period
                insured under any form of fleet cover, the Borrower shall procure
                that
                those letters of undertaking contain confirmation that the brokers,
                underwriters or association (as the case may be) will not set off
                claims
                relating to the Vessel against premiums, calls or contributions in
                respect
                of any other vessel or other insurance, and that the insurance cover
                of
                the Vessel will not be cancelled by reason of non-payment of premiums,
                calls or contributions relating to any other vessel or other insurance.
                Failing receipt of those confirmations, the Borrower will instruct
                the
                brokers, underwriters or association concerned to issue a separate
                policy
                or certificate for the Vessel in the sole name of the Borrower or
                of the
                Borrower's brokers as agents for the
                Borrower.

            

    

     

    
      	 	
              10.3.8

            	
              The
                Borrower shall promptly provide the Agent with full information regarding
                any casualty or other accident or damage to any
                Vessel.

            

    

     

    
      
        
        

      

      
        59

        
          

        

      

      
        
        

      

    

    
      	 	
              10.3.9

            	
              The
                Borrower agrees that, at any time after the occurrence and during
                the
                continuation of an Event of Default, the Agent shall be entitled
                to
                collect, sue for, recover and give a good discharge for all claims
                in
                respect of any of the Insurances; to compromise all such claims or
                refer
                them to arbitration or any other form of judicial or non-judicial
                determination; and otherwise to deal with such claims in such manner
                as
                the Agent shall in its discretion think
                fit.

            

    

     

    
      	 	
              10.3.10

            	
              Whether
                or not an Event of Default shall have occurred or be continuing,
                the
                proceeds of any claim under any of the Insurances in respect of a
                Total
                Loss in excess of the Threshold Amount shall be paid to the Agent
                and
                applied by the Agent in accordance with Clause
                13.4.

            

    

     

    
      	 	
              10.3.11

            	
              Following
                the occurrence of an Event of Default which shall be continuing,
                in the
                event of any claim in respect of any of the Insurances (other than
                in
                respect of a Total Loss), if the Borrower shall fail to reach agreement
                with any of the brokers, underwriters or associations for the immediate
                restoration of any Vessel, or for payment to third parties, within
                such
                time as the Agent may stipulate, the Agent shall be entitled to require
                payment to itself. In the event of any dispute arising between the
                Borrower and any broker, underwriter or association with respect
                to any
                obligation to make any payment to the Borrower or to the Agent under
                or in
                connection with any of the Insurances, or with respect to the amount
                of
                any such payment, the Agent shall be entitled to settle that dispute
                directly with the broker, underwriter or association concerned. Any
                such
                settlement shall be binding on the
                Borrower.

            

    

     

    
      	 	
              10.3.12

            	
              The
                Agent agrees that any amounts which may become due under any protection
                and indemnity entry or insurance shall be paid to the Borrower to
                reimburse the Borrower for, and in discharge of, the loss, damage
                or
                expense in respect of which they shall have become due, unless, at
                the
                time the amount in question becomes due, an Event of Default shall
                have
                occurred and be continuing, in which event the Agent shall be entitled
                to
                receive the amounts in question and to apply them either in reduction
                of
                the Indebtedness or, at the option of the Agent, to the discharge
                of the
                liability in respect of which they were
                paid.

            

    

     

    
      
        
        

      

      
        60

        
          

        

      

      
        
        

      

    

    
      	 	
              10.3.13

            	
              The
                Borrower shall not settle, compromise or abandon any claim under
                or in
                connection with any of the Insurances (other than a claim of less
                than the
                Threshold Amount arising other than from a Total Loss) without the
                prior
                written consent of the Agent.

            

    

     

    
      	 	
              10.3.14

            	
              If
                the Borrower fails to effect or keep in force the Obligatory Insurances,
                the Agent may (but shall not be obliged to) effect and/or keep in
                force
                such insurances on the Vessels and such entries in protection and
                indemnity or war risks associations as the Agent in its discretion
                considers desirable, and the Agent may (but shall not be obliged
                to) pay
                any unpaid premiums, calls or contributions. The Borrower will reimburse
                the Agent from time to time on demand for all such premiums, calls
                or
                contributions paid by the Agent, together with interest at the Default
                Rate from the date of payment by the Agent until the date of
                reimbursement.

            

    

     

    
      	 	
              10.3.15

            	
              The
                Borrower shall comply strictly with the requirements of any legislation
                relating to pollution or protection of the environment which may
                from time
                to time be applicable to the Vessels in any jurisdiction in which
                any
                Vessel shall trade and in particular (if such Vessel is to trade
                in the
                United States of America and Exclusive Economic Zone (as defined
                in the
                Act)) the Borrower shall comply strictly with the requirements of
                the
                United States Oil Pollution Act 1990 (the "Act").
                Before any such trade is commenced and during the entire period during
                which such trade is carried on, the Borrower
                shall:

            

    

     

    (a) pay
      any
      additional premiums required to maintain protection and indemnity cover for
      oil
      pollution up to the limit available to the Borrower for such Vessel in the
      market; and

     

    (b) make
      all
      such quarterly or other voyage declarations as may from time to time be required
      by such Vessel's protection and indemnity association in order to maintain
      such
      cover, and promptly deliver to the Agent copies of such declarations;
      and

     

    (c) submit
      such Vessel to such additional periodic, classification, structural or other
      surveys which may be required by the Vessel's protection and indemnity insurers
      to maintain cover for such trade 

     

    
      
        
        

      

      
        61

        
          

        

      

      
        
        

      

    

    and
      promptly deliver to the Agent copies of reports made in respect of such surveys;
      and

     

    (d) implement
      any recommendations contained in the reports issued following the surveys
      referred to in Clause 10.3.15 (d) within the relevant time limits, and provide
      evidence satisfactory to the Agent that the protection and indemnity insurers
      are satisfied that this has been done; and

     

    (e) in
      addition to the foregoing (if such trade is in the United States of America
      and
      Exclusive Economic Zone):

     

    (i) obtain
      and retain a certificate of financial responsibility under the Act in form
      and
      substance satisfactory to the United States Coast Guard and provide the Agent
      with a copy; and

     

    (ii) procure
      that the protection and indemnity insurances do not contain a US Trading
      Exclusion Clause or any other analogous provision and provide the Agent with
      evidence that this is so; and

     

    (iii) comply
      strictly with any operational or structural regulations issued from time to
      time
      by any relevant authorities under the Act so that at all times the Vessels
      fall
      within the provisions which limit strict liability under the Act for oil
      pollution.

     

    10.4 Vessel
      Covenants - Operation and Maintenance

     

    The
      Borrower covenants with the Agent:

     

    
      	 	
              10.4.1

            	
              to
                keep the Vessels seaworthy and in a state of complete repair and
                in
                compliance with the requirements from time to time of all applicable
                laws,
                conventions and regulations and of her insurers;
                and

            

    

     

    
      	 	
              10.4.2

            	
              to
                maintain the registration of each Vessel under its current flag or
                such
                other flag as may be consented to by the Agent with such consent
                not to be
                unreasonably withheld, to effect and maintain registration of each
                

            

    

     

    
      
        
        

      

      
        62

        
          

        

      

      
        
        

      

    

    Mortgage
      at each Vessel's Ship Registry; and not cause nor permit to be done any act
      or
      omission as a result of which either of those registrations might be defeated
      or
      imperilled; and

     

    
      	 	
              10.4.3

            	
              to
                maintain the Vessels in a condition entitling each Vessel to the
                highest
                class applicable to vessels of her type with a Pre-Approved Classification
                Society free of recommendations and qualifications and not cause
                nor
                permit to be done any act or omission as a result of which a Vessel
                would
                no longer be classed by such Pre-Approved Classification Society;
                and
                

            

    

     

    
      	 	
              10.4.4

            	
              to
                comply with all laws, conventions and regulations applicable to the
                Borrower or to the Vessels and to carry on board each Vessel all
                certificates and other documents which may from time to time be required
                to evidence such compliance; and 

            

    

     

    
      	 	
              10.4.5

            	
              to
                procure that all repairs to each Vessel or replacements of parts
                or
                equipment of each Vessel are effected in such a way as not to diminish
                the
                value of such Vessel and with replacement parts or equipment the
                property
                of the Borrower and free of all Encumbrances (other than the Mortgage);
                and

            

    

     

    
      	 	
              10.4.6

            	
              to
                permit the Agent and all persons appointed by the Agent to board
                the
                Vessels from time to time during the Facility Period to inspect each
                Vessel's state and condition and, if such Vessel shall not be in
                a state
                and condition which complies with the requirements of this Agreement,
                to
                effect such repairs as shall in the opinion of the Agent be desirable
                to
                ensure such compliance, without prejudice to the Agent's other rights
                under or pursuant to the Mortgage or this Agreement;
                and

            

    

     

    
      	 	
              10.4.7

            	
              immediately
                to notify the Agent of any arrest or detention of the Vessels, and
                to
                cause such Vessel to be released from arrest or detention as quickly
                as
                possible, and in any event within fifteen (15) Business Days from
                the date
                of arrest or detention, and immediately to notify the Agent in the
                same
                manner of the release of such Vessel;
                and

            

    

     

    
      
        
        

      

      
        63

        
          

        

      

      
        
        

      

    

    
      	 	
              10.4.8

            	
              not
                during the Facility Period to sell, agree to sell, or otherwise dispose
                of, or agree to dispose of, the Vessels without the prior written
                consent
                of the Agent; and

            

    

     

    
      	 	
              10.4.9

            	
              in
                the event of any requisition or seizure of any Vessel, to take all
                lawful
                steps to recover possession of the Vessel as soon as it is entitled
                to do
                so; and 

            

    

     

    
      	 	
              10.4.10

            	
              to
                give to the Agent from time to time during the Facility Period on
                request
                such information as the Agent may require with regard to each Vessel's
                employment, position and state of repair and, on the Agent's request,
                to
                supply the Agent with copies of all charterparties and other contracts
                of
                employment relating to each Vessel and copies of each Vessel's deck
                and
                engine logs; and

            

    

     

    
      	 	
              10.4.11

            	
              to
                comply with all requirements from time to time of each Vessel's
                classification society and to give to the Agent from time to time
                during
                the Facility Period on request copies of all classification certificates
                of each Vessel and reports of surveys required by each Vessel's
                classification society (the Borrower by its execution of this Agreement
                irrevocably authorising the Agent to obtain such information and
                documents
                from each Vessel's classification society as the Agent may from time
                to
                time require), and to notify the Agent immediately of any requirement
                or
                recommendation imposed by each Vessel's classification society;
                and

            

    

     

    
      	 	
              10.4.12

            	
              not
                during hostilities (whether or not a state of war shall formally
                have been
                declared and including, without limitation, any civil war) to permit
                any
                Vessel to be employed in carrying any goods which may be declared
                to be
                contraband of war or which may render such Vessel liable to confiscation,
                seizure, detention or destruction, nor to permit any Vessel to enter
                any
                area which is declared a war zone by any governmental authority or
                by any
                Vessel's insurers unless the Agent shall have consented to that employment
                or voyage in writing, which consent (if given) shall be conditional
                on the
                Borrower effecting at its own expense such additional insurances
                as the
                Agent shall consider necessary or desirable and, if required by the
                Agent,
                specifically assigning those insurances to the Agent by such documents
                as
                the Agent may require; and 

            

    

     

    
      
        
        

      

      
        64

        
          

        

      

      
        
        

      

    

    
      	 	
              10.4.13

            	
              not
                without the prior written consent of the Agent to let any Vessel
                on any
                demise charter which (inclusive of any extension option) is capable
                of
                exceeding thirty seven (37) months nor to employ any Vessel in any
                way
                which might impair the security created by the Security Documents;
                and

            

    

     

    
      	 	
              10.4.14

            	
              duly
                to perform (unless prevented by force majeure), and to take all necessary
                steps to enforce the performance by charterers and shippers of, all
                charterparties and other contracts of employment and all bills of
                lading
                and other contracts relating to the Vessels;
                and

            

    

     

    
      	 	
              10.4.15

            	
              not
                following the occurrence and during the continuation of an Event
                of
                Default to let any Vessel on charter or renew or extend any charter
                or
                other contract of employment of any Vessel, nor agree to do so, without
                the prior written consent of the Agent;
                and

            

    

     

    
      	 	
              10.4.16

            	
              to
                pay and discharge when due from time to time all taxes, levies, duties,
                fines and penalties imposed on each Vessel, or on the Borrower, its
                income, profits, capital gains or any of its property; and
                

            

    

     

    
      	 	
              10.4.17

            	
              not
                at any time during the Facility Period without the prior written
                consent
                of the Agent (and then subject to such conditions as the Agent may
                impose)
                to create nor grant nor permit to exist any Encumbrance over any
                Vessel or
                any of the Assigned Property other than any Permitted Encumbrances
                existing from time to time; and

            

    

     

    
      	 	
              10.4.18

            	
              to
                notify the Agent immediately the Borrower becomes aware of any legal
                proceedings or arbitration involving any Vessel or the Borrower where
                the
                amount claimed by any party (ignoring any counterclaim or defence
                of
                set-off) exceeds or may reasonably be expected to exceed the Threshold
                Amount; and

            

    

     

    
      	 	
              10.4.19

            	
              to
                keep proper books of account in respect of each Vessel and as and
                when
                required by the Agent to make such books available for inspection
                on
                behalf of the Agent; and

            

    

     

    
      	 	
              10.4.20

            	
              not
                to permit anyone other than the Manager to be appointed as commercial
                or
                technical managers of any Vessel, nor permit any material variation
                of the
                arrangements for the commercial or technical

            

    

     

    
      
        
        

      

      
        65

        
          

        

      

      
        
        

      

    

    management
      of any Vessel, nor permit the Manager to sub-contract or delegate a material
      part of the commercial or technical management of any Vessel to any third party;
      and

     

    
      	 	
              10.4.21

            	
              to
                take all reasonable precautions to prevent any infringements of any
                anti
                drug legislation in any jurisdiction in which the Vessels shall trade
                and
                in particular (if any Vessel is to trade in the United States of
                America)
                to take all reasonable precautions to prevent any infringements of
                the
                Anti-Drug Abuse Act of 1986 of the United States of America and for
                this
                purpose to enter into a "Carrier Initiative Agreement" with the United
                States' Customs Service and to procure that the same or a similar
                agreement is maintained in full force and effect and that the Borrower's
                obligations under that agreement are performed in respect of such
                Vessel;
                and 

            

    

     

    
      	 	
              10.4.22

            	
              to
                comply, or procure that the operator of the Vessels will comply,
                with the
                International Management Code for the Safe Operation of Ships and
                for
                Pollution Prevention adopted by the International Maritime Organisation
                (as the same may be amended from time to time) (the "ISM
                Code")
                or any replacement of the ISM Code and in particular, without limitation,
                to:

            

    

     

    (a)  procure
      that the Vessels remain for the duration of the Facility Period subject to
      a
      safety management system developed and implemented in accordance with the ISM
      Code; and

     

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

     

    (c) procure
      that the ISM Company maintains throughout the Facility Period a valid and
      current DOC and provide a copy to the Agent; and

     

    (d) notify
      the Agent immediately in writing of any actual or threatened withdrawal,
      suspension, cancellation or modification of the SMC of the Vessel or of the
      DOC
      of the ISM Company.

     

    
      
        
        

      

      
        66

        
          

        

      

      
        
        

      

    

    
      	 	
              10.4.23

            	
              to
                comply in relation to each Vessel with the ISPS Code or any replacement
                of
                the ISPS Code and in particular, without limitation,
                to:

            

    

     

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

     

    (b) maintain
      for each Vessel throughout the Facility Period a valid and current International
      Ship Security Certificate issued under the ISPS Code ("ISSC")
      and
      provide a copy to the Agent; and

     

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

     

    
      	 	
              10.4.24

            	
              to
                comply in relation to each Vessel with Annex VI (Regulations for
                the
                Prevention of Air Pollution from Ships) to the International Convention
                for the Prevention of Pollution from Ships 1973 (as modified in 1978
                and
                1997) (as the same may be amended from time to time) ("Annex
                VI")
                or any replacement of Annex VI and in particular, without limitation,
                to:

            

    

     

    (a) procure
      that each Vessel's master and crew are familiar with, and that each Vessel
      complies with, Annex VI; and

     

    (b) maintain
      for each Vessel throughout the Facility Period a valid and current International
      Air Pollution Prevention Certificate issued under Annex VI ("IAPPC")
      and
      provide a copy to the Agent; and

     

     

    10.4.25 notify
      the Agent immediately in writing of any actual or threatened withdrawal,
      suspension, cancellation or modification of the IAPPC.

     

    
      	11  	
              Earnings

            

    

     

    
      	 	
              11.1

            	
              Remittance
                of Earnings The
                Borrower shall procure that all Net Earnings and any Requisition
                Compensation are paid to the Earnings Account or to such other account(s)
                as the Agent shall from time to time specify by notice in writing
                to the
                Borrower to begin as of no later than 30 June 2006 or such later
                date as
                the Banks shall agree. 

            

    

     

    
      
        
        

      

      
        67

        
          

        

      

      
        
        

      

    

    
      	 	
              11.2

            	
              Earnings
                Account The
                Borrower shall maintain the Earnings Account with the Agent for the
                duration of the Facility Period free of Encumbrances and rights of
                set off
                except for Permitted Liens and those Encumbrances and rights of set
                off
                created by or under the Security Documents.

            

    

     

    
      	12  	
              Events Of Default

            

    

     

    
      	 	
              12.1

            	
              The
                Agent's rights If
                any of the events set out in Clause 12.2 occurs, the Agent may at
                its
                discretion (and, on the instructions of the Majority Banks,
                will):

            

    

     

    12.1.1 by
      notice
      to the Borrower declare the Banks to be under no further obligation to the
      Borrower under or pursuant to this Agreement and may (and, on the instructions
      of the Majority Banks, will) declare all or any part of the Indebtedness
      (including such unpaid interest as shall have accrued and any Break Costs
      incurred by the Finance Parties) to be immediately payable, whereupon the
      Indebtedness (or the part of the Indebtedness referred to in the Agent's notice)
      shall immediately become due and payable without any further demand or notice
      of
      any kind; and/or

     

    12.1.2 declare
      that any undrawn portion of the Facility shall be cancelled, whereupon the
      same
      shall be cancelled and the corresponding Commitment of each Bank shall be
      reduced to zero; and/or

     

    
      	 	
              12.1.3

            	
              exercise
                any rights and remedies in existence or arising under the Security
                Documents.

            

    

     

    
      	 	
              12.2

            	
              Events
                of Default The
                events referred to in Clause 12.1
                are:-

            

    

     

    
      	 	
              12.2.1

            	
              payment
                default if
                the Borrower defaults in the payment of any part of the Indebtedness
                when
                due PROVIDED
                ALWAYS
                that if the Borrower can demonstrate to the reasonable satisfaction
                of the
                Agent that it has given all necessary instructions to effect payment
                and
                the non-receipt thereof is attributable to an error in the banking
                system,
                such Event of Default shall only occur two (2) Business Days after
                such
                payment fell due; or

            

    

     

    
      
        
        

      

      
        68

        
          

        

      

      
        
        

      

    

    
      	 	
              12.2.2

            	
              other
                default if
                any of the Security Parties fails to observe or perform any of the
                covenants, conditions, undertakings, agreements or obligations on
                its part
                contained in any of the Security Documents or shall in any other
                way be in
                breach of any of the Security Documents and such default (if in the
                reasonable opinion of the Majority Banks capable of remedy) is not
                remedied within fifteen (15) Business Days after notice of the default
                has
                been given to the Borrower; or 

            

    

     

    
      	 	
              12.2.3

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

            

    

     

    
      	 	
              12.2.4

            	
              execution
                if
                a distress or execution or other process of a court or authority
                not
                covered by insurance is levied on any of the property of any of the
                Security Parties before or after final judgment or by order of any
                competent court or authority for an amount in excess of one million
                Dollars ($1,000,000) or its equivalent in any other currency and
                is not
                satisfied or stayed (with a view to being contested in good faith)
                within
                fourteen days of levy or any other applicable cure period (if longer);
                or

            

    

     

    
      	 	
              12.2.5

            	
              insolvency
                events if
                any of the Security Parties:-

            

    

     

    
      	 	
              (a)

            	
              resolves
                to appoint, or applies for, or consents to the appointment of, a
                receiver,
                administrative receiver, trustee, administrator or liquidator of
                itself or
                of all or part of its assets; or

            

    

     

    
      	 	
              (b)

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

            

    

     

    
      	 	
              (c)

            	
              makes
                a general assignment for the benefit of creditors;
                or

            

    

     

    
      	 	
              (d)

            	
              ceases
                trading or threatens to cease trading;
                or

            

    

     

    
      
        
        

      

      
        69

        
          

        

      

      
        
        

      

    

    
      	 	
              (e)

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

            

    

     

    
      	 	
              12.2.6

            	
              insolvency
                proceedings if
                any proceedings are commenced or threatened, or any order or judgment
                is
                given by any court, for the bankruptcy, liquidation, winding up,
                administration or re-organisation of any of the Security Parties
                or for
                the appointment of a receiver, administrative receiver, administrator,
                liquidator or trustee of any of the Security Parties or of all or
                any
                material part of the assets of any of the Security Parties or if
                any
                person appoints or purports to appoint such receiver, administrative
                receiver, administrator, liquidator or trustee which proceeding is
                not
                discharged within fifteen (15) days of its commencement;
                or

            

    

     

    
      	 	
              12.2.7

            	
              impossibility
                or illegality unless
                covered by Clause 15.7, if any event occurs which would, or would
                with the
                passage of time, render performance of any of the Security Documents
                impossible, unlawful or unenforceable by the Banks or the Agent;
                or

            

    

     

    
      	 	
              12.2.8

            	
              conditions
                subsequent if
                any of the conditions set out in Clause 3.3 is not satisfied within
                the
                time reasonably required by the Agent;
                or

            

    

     

    
      	 	
              12.2.9

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

            

    

     

    
      	 	
              12.2.10

            	
              curtailment
                of business if
                the business of any of the Security Parties is wholly or materially
                curtailed by any intervention by or under authority of any government,
                or
                if all or a substantial part of the undertaking, property or assets
                of any
                of the Security Parties is seized, nationalised,
                

            

    

     

    
      
        
        

      

      
        70

        
          

        

      

      
        
        

      

    

    expropriated
      or compulsorily acquired by or under authority of any government or any Security
      Party disposes or threatens to dispose of a substantial part of its business
      or
      assets; or

     

    
      	 	
              12.2.11

            	
              acceleration
                of other indebtedness if
                any Financial Indebtedness of any of the Security Parties or any
                Material
                Subsidiary becomes due or capable of being declared due prior to
                its
                stated maturity by reason of default on the part of that Security
                Party or
                Material Subsidiary (as the case may be), or is not repaid or satisfied
                on
                the due date for its repayment or any such other loan, guarantee
                or
                indebtedness becomes enforceable save for amounts of less than one
                million
                Dollars ($1,000,000) in aggregate, or its equivalent in any other
                currency; or

            

    

     

    
      	 	
              12.2.12

            	
              reduction
                of capital if
                any of the Security Parties reduces its authorised or issued or subscribed
                capital except as part of a share buy-back, whilst solvent, by the
                Borrower; or

            

    

     

    
      	 	
              12.2.13

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

            

    

     

    
      	 	
              12.2.14

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

            

    

     

    
      	 	
              12.2.15

            	
              material
                adverse change etc. if
                any thing is done or permitted or omitted to be done by any of the
                Security Parties or any Material Subsidiary which in the reasonable
                opinion of the Majority Banks has a Material Adverse Effect or if
                there
                occurs (in the reasonable opinion of the Majority Banks) any material
                adverse change in the business, affairs or financial condition of
                any of
                the Security Parties or any Material Subsidiary from that pertaining
                at
                the date of this Agreement; or 

            

    

     

    
      
        
        

      

      
        71

        
          

        

      

      
        
        

      

    

    
      	 	
              12.2.16

            	
              final
                judgements
                if
                any of the Security Parties fails to comply with any non appealable
                court
                order or fails to pay a final unappealable judgment against it which
                remains unsettled for fifteen (15) Business Days;
                or

            

    

     

    
      	 	
              12.2.17

            	
              loss
                of stock market listing
                if
                the Guarantor ceases to be listed on NASDAQ or another recognised
                stock
                exchange for more than fifteen (15) Business Days;
                or

            

    

     

    
      	 	
              12.2.18

            	
              similar
                event any
                event occurs which, under the laws of any jurisdiction, has a similar
                or
                analogous effect to any of those events mentioned in Clauses 12.2.4,
                12.2.5 and 12.2.6; or

            

    

     

    
      	 	
              12.2.19

            	
              environmental
                matters

            

    

     

    
      	 	
              (a)

            	
              any
                Environmental Claim is pending or made against the Borrower or any
                of the
                Borrower's Environmental Affiliates or in connection with a Vessel,
                where
                such Environmental Claim has a Material Adverse Effect, where such
                Environmental Claim is not covered by the Insurances.
                

            

    

     

    
      	 	
              (b)

            	
              any
                actual Environmental Incident occurs in connection with a Vessel,
                where
                such Environmental Incident has a Material Adverse Effect, where
                such
                Environmental Claim is not covered by the Insurances; or
                

            

    

     

    
      	 	
              12.2.20

            	
              repudiation
                Any Security Party repudiates any Security Document to which it is
                a party
                or does or causes to be done any act or thing evidencing an intention
                to
                repudiate any such Security Documents;
                or

            

    

     

    
      	 	
              12.2.21

            	
              Change
                in ownership or control of the Borrower
                There is any change in the beneficial ownership or control of the
                Borrower
                from that advised to the Agent by the Borrower at the date of this
                Agreement.

            

    

     

    
      	13  	
              Set-Off
                and Lien

            

    

     

    
      	 	
              13.1

            	
              Set-off
                The
                Borrower irrevocably authorises each of the Finance Parties at any
                time
                after all or any part of the Indebtedness shall have become due and
                payable to set off without notice any liability of the Borrower to
                any of
                the Finance Parties (whether present or actual, and irrespective
                of the
                branch or office, currency or 

            

    

     

    
      
        
        

      

      
        72

        
          

        

      

      
        
        

      

    

    place
      of
      payment) against any credit balance from time to time standing on any account
      of
      the Borrower (whether current or otherwise and whether or not subject to notice)
      with any branch of any of the Finance Parties in or towards satisfaction of
      the
      Indebtedness and, in the name of that Finance Party or the Borrower, to do
      all
      acts (including, without limitation, converting or exchanging any currency)
      and
      execute all documents which may be required to effect such
      application.

     

    
      	 	
              13.2

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

            

    

     

    
      	 	
              13.3

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

            

    

     

    
      	 	
              13.4

            	
              Application
                Whilst
                an Event of Default is continuing unremedied or unwaived, the Borrower
                irrevocably authorises the Agent to apply all sums which the Agent
                may
                receive:-

            

    

     

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

     

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

     

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

     

    
      
        
        

      

      
        73

        
          

        

      

      
        
        

      

    

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

     

    
      	14  	
              Assignment and
                Sub-Participation

            

    

     

    
      	 	
              14.1

            	
              Right
                to assign Each
                of the Banks may assign or transfer all or any of its rights under
                or
                pursuant to the Security Documents or assign or grant sub-participations
                in all or any part of its Commitment (i) to any other branch or affiliate
                of that Bank or to another Bank or (ii) with the prior written consent
                of
                the Agent and the Borrower (which shall not be unreasonably withheld
                and
                which shall be deemed given if no response shall be received within
                ten
                (10) Business Days of a request or at any time whilst an Event of
                Default
                is in existence) to any other bank or financial
                institution.

            

    

     

    
      	 	
              14.2

            	
              Borrower's
                co-operation The
                Borrower will co-operate fully and will procure that the other Security
                Parties co-operate fully with the Banks in connection with any assignment,
                transfer or sub-participation pursuant to Clause 14.1; will execute
                and
                procure the execution of such documents as the Banks may require
                in
                connection therewith; and irrevocably authorises each of the Finance
                Parties to disclose to any proposed assignee, transferee or
                sub-participant (whether before or after any assignment, transfer
                or
                sub-participation and whether or not any assignment, transfer or
                sub-participation shall take place) all information relating to the
                Security Parties, the Facility or the Security Documents which each
                such
                Finance Party may in its discretion consider necessary or desirable
                (subject to any duties of confidentiality applicable to the Banks
                generally). 

            

    

     

    
      	 	
              14.3

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

            

    

     

    
      	 	
              14.4

            	
              Transfer
                Certificates
                If
                any Bank wishes to transfer all or any of its Commitment as contemplated
                in Clause 14.1 then such transfer may be effected by the delivery
                to the
                Agent and the Banks of a duly completed and duly executed Transfer
                Certificate in which event, on the later of the Transfer Date specified
                in
                such Transfer Certificate and the fifth Business Day after the date
                of
                delivery of such Transfer Certificate to the
                Agent:

            

    

     

    
      
        
        

      

      
        74

        
          

        

      

      
        
        

      

    

    14.4.1 to
      the
      extent that in such Transfer Certificate the Bank which is a party thereto
      seeks
      to transfer its Commitment in whole, the Borrower and such Bank shall be
      released from further obligations towards each other under this Agreement and
      their respective rights against each other shall be cancelled other than
      existing claims against such Bank for breach of this Agreement (such rights,
      benefits and obligations being referred to in this Clause 14.4 as "discharged
      rights and obligations");

     

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

     

    14.4.3 the
      Finance Parties and the Transferee shall acquire the same rights and benefits
      and assume the same obligations between themselves as they would have acquired
      and assumed had such Transferee been an original party to this Agreement as
      a
      Bank with the rights, benefits and/or obligations acquired or assumed by it
      as a
      result of such transfer; and

     

    14.4.4 the
      Transferee shall pay to the Agent a transfer fee of three thousand Dollars
      ($3,000).

     

    
      	 	
              14.5

            	
              Power
                of Attorney In
                order to give effect to each Transfer Certificate, the Finance Parties
                (with the exception of the Banks) and the Borrower each hereby irrevocably
                and unconditionally appoint the Agent as its true and lawful attorney
                with
                full power to execute on their respective behalves each Transfer
                Certificate delivered to the Agent pursuant to Clause 14.4 without
                the
                Agent being under any obligation to take any further instructions
                from or
                give any prior notice to, any of the Finance Parties or, subject
                to the
                Borrower's rights under Clause 14.1, the Borrower before doing so
                and the
                Agent shall so execute each such Transfer Certificate on behalf of
                the
                other Finance Parties (with the exception of the Banks) and the Borrower
                immediately on its receipt of the same pursuant to Clause
                14.4.

            

    

     

    
      	 	
              14.6

            	
              Notification
                The
                Agent shall promptly notify the other Finance Parties (with the exception
                of the Banks), the Transferee and the Borrower on the execution by
                it
                

            

    

     

    
      
        
        

      

      
        75

        
          

        

      

      
        
        

      

    

    and
      the
      Banks of any Transfer Certificate together with details of the amount
      transferred, the Transfer Date and the parties to such transfer.

     

    
      	15  	
              Payments,
                Mandatory Prepayment, Reserve Requirements and
                Illegality

            

    

     

    
      	 	
              15.1

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

            

    

     

    
      	 	
              15.2

            	
              No
                deductions or withholdings All
                payments (whether of principal or interest or otherwise) to be made
                by the
                Borrower pursuant to the Security Documents shall, subject only to
                Clause
                15.3, be made free and clear of and without deduction for or on account
                of
                any Taxes or other deductions, withholdings, restrictions, conditions
                or
                counterclaims of any nature, and the Borrower will not claim any
                equity in
                respect of any payment due from them to the Banks or to the Agent
                under or
                in relation to any of the Security
                Documents.

            

    

     

    
      	 	
              15.3

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

            

    

     

    
      
        
        

      

      
        76

        
          

        

      

      
        
        

      

    

    
      	 	
              15.4

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

            

    

     

    
      	 	
              15.5

            	
              Adjustment
                of due dates If
                any payment to be made under any of the Security Documents, other
                than a
                payment of interest on the Facility (to which Clause 6.5 applies),
                shall
                be due on a day which is not a Business Day, that payment shall be
                made on
                the next succeeding Business Day (unless the next succeeding Business
                Day
                falls in the next calendar month in which event the payment shall
                be made
                on the next preceding Business Day). Any such variation of time shall
                be
                taken into account in computing any interest in respect of that
                payment.

            

    

     

    
      	 	
              15.6

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

            

    

     

    
      
        
        

      

      
        77

        
          

        

      

      
        
        

      

    

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

     

    
      	 	
              15.6.1

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

            

    

     

    
      	 	
              15.6.2

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

            

    

     

    
      	 	
              15.6.3

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

            

    

     

    
      	 	
              15.6.4

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

            

    

     

    
      	 	
              15.6.5

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

            

    

     

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

     

    
      
        
        

      

      
        78

        
          

        

      

      
        
        

      

    

    its
      calculation shall be submitted to the Borrower and shall be conclusive evidence
      of such amount save for manifest error or on any question of law.

     

    
      	 	
              15.7

            	
              Illegality
                and impracticality Notwithstanding
                anything contained in the Security Documents, the obligations of
                a Bank to
                advance or maintain its Commitment shall terminate in the event that
                a
                change in any law or in the interpretation of any law by any authority
                charged with its administration shall make it unlawful for that Bank
                to
                advance or maintain its Commitment. In such event the Bank affected
                shall
                notify the Agent and the Agent shall, by written notice to the Borrower,
                declare that Bank's obligations to be immediately terminated. If
                all or
                any part of the Facility shall have been advanced by the Banks to
                the
                Borrower the portion of the Indebtedness (including all accrued interest)
                advanced by the Bank so affected shall be prepaid within thirty days
                from
                the date of such notice, or sooner if illegality is determined. Clause
                5.4
                shall apply to either of those prepayments if it is made on a day
                other
                than the last day of an Interest Period. During that period, the
                affected
                Bank shall negotiate in good faith with the Borrower to find an
                alternative method or lending base in order to maintain the
                Facility.

            

    

     

    
      	 	
              15.8

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

            

    

     

    
      	 	
              15.8.1

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

            

    

     

    
      	 	
              15.8.2

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

            

    

     

    
      	 	
              15.8.3

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

            

    

     

    
      
        
        

      

      
        79

        
          

        

      

      
        
        

      

    

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

     

    If,
      within thirty days of the giving of the notice referred to in
      Clause 15.8.1, the Borrower and the Agent fail to agree in writing on a
      substitute basis for such Bank’s Commitment the Borrower will immediately prepay
      the amount of such Bank’s Commitment and the Maximum Facility Amount will
      automatically decrease by the amount of such Commitment and such decrease shall
      not be reversed. Clause 5.4 shall apply to that prepayment if it is made on
      a
      day other than the last day of an Interest Period.

     

    
      	 	
              15.9

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

            

    

     

    
      	16  	
              Communications

            

    

     

    
      	 	
              16.1

            	
              Method
                Except for Communications pursuant to Clause 9, which shall be made
                or
                given in accordance with Clause 9.20, any Communication may be given,
                

            

    

     

    
      
        
        

      

      
        80

        
          

        

      

      
        
        

      

    

    delivered,
      made or served (as the case may be) under or in relation to this Agreement
      by
      letter or fax and shall be in the English language and sent addressed:-

     

    
      	 	
              16.1.1

            	
              in
                the case of any of the Finance Parties to the Agent at its address
                at the
                head of this Agreement (fax no: +47 5521 1924) marked for the attention
                of: Credit Administration; and 

            

    

     

    
      	 	
              16.1.2

            	
              in
                the case of the Borrower to the Communications
                Address;

            

    

     

    or
      to
      such other address or fax number as the Agent or the Borrower may designate
      for
      themselves by written notice to the others.

     

    
      	 	
              16.2

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

            

    

     

    
      	 	
              16.2.1

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

            

    

     

    
      	 	
              16.2.2

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

            

    

     

    
      	 	
              16.2.3

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

            

    

     

    Any
      Communication by fax shall be promptly confirmed in writing by post or hand
      delivery.

     

    
      	17  	
              General
                Indemnities

            

    

     

    
      	 	
              17.1

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

            

    

     

    
      
        
        

      

      
        81

        
          

        

      

      
        
        

      

    

    full
      the
      amount due and that further amount shall be due to the Agent on behalf of the
      Finance Parties as a separate debt under this Agreement.

     

    
      	 	
              17.2

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

            

    

     

    
      	 	
              17.2.1

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

            

    

     

    
      	 	
              17.2.2

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

            

    

     

    
      	 	
              17.2.3

            	
              any
                other documents which may at any time reasonably be required by any
                Finance Party to give effect to any of the Security Documents or
                which any
                Finance Party is entitled to call for or obtain pursuant to any of
                the
                Security Documents; and

            

    

     

    
      	 	
              17.2.4

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

            

    

     

    
      	 	
              17.3

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

            

    

     

    
      	 	
              17.4

            	
              Funding
                costs
                The Borrower shall indemnify the Finance Parties from time to time
                on
                demand against all losses and costs incurred or sustained by any
                Finance
                Party if, for any reason due to a default or other action by the
                Borrower,
                any Drawing is not advanced to the Borrower after the relevant Drawdown
                Notice has been given to the Agent, or is advanced on a date other
                than
                that requested in the Drawdown Notice, including (without limitation)
                any
                Break Costs.

            

    

     

    
      
        
        

      

      
        82

        
          

        

      

      
        
        

      

    

    
      	 	
              17.5

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

            

    

     

    
      	 	
              17.6

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

            

    

     

    
      	 	
              17.7

            	
              Taxes
                The
                Borrower shall pay all Taxes to which all or any part of the Indebtedness
                or any of the Security Documents may be at any time subject and shall
                indemnify the Finance Parties on demand against all liabilities,
                costs,
                claims and expenses incurred in connection therewith, including but
                not
                limited to any such liabilities, costs, claims and expenses resulting
                from
                any omission to pay or delay in paying any such Taxes. The indemnity
                contained in this Clause shall survive the repayment of the
                Indebtedness.

            

    

     

    
      
        
        

      

      
        83

        
          

        

      

      
        
        

      

    

    

     

    
      	18  	
              Miscellaneous

            

    

     

    
      	 	
              18.1

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

            

    

     

    
      	 	
              18.2

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

            

    

     

    
      	 	
              18.3

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

            

    

     

    
      	 	
              18.4

            	
              Successors
                etc. The
                Security Documents shall be binding on the Security Parties and on
                their
                successors and permitted transferees and assignees, and shall inure
                to the
                benefit of the Finance Parties and their respective successors,
                transferees and assignees. The Borrower may not assign or transfer
                any of
                its rights or duties under or pursuant to any of the Security Documents
                without the prior written consent of the
                Banks.

            

    

     

    
      	 	
              18.5

            	
              Further
                assurance If
                any provision of the Security Documents shall be invalid or unenforceable
                in whole or in part by reason of any present or future law or any
                decision
                of any court, or if the documents at any time held by the Finance
                Parties
                on their behalf are considered by the Banks for any reason insufficient
                to
                carry out the terms of this Agreement, then from time to time the
                Borrower
                will promptly, on demand by the Agent, execute or procure the execution
                of
                such further documents as in the reasonable opinion of the Banks
                are
                necessary to provide adequate security for the repayment of the
                Indebtedness.

            

    

     

    
      
        
        

      

      
        84

        
          

        

      

      
        
        

      

    

    
      	 	
              18.6

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

            

    

     

    
      	 	
              18.7

            	
              Advisers
                The Borrower irrevocably authorises the Agent, at any time and from
                time
                to time during the Facility Period, to consult insurance advisers
                on any
                matters relating to the Insurances, and from time to time to consult
                or
                retain advisers or consultants to monitor or advise on any other
                claims
                relating to the Vessels. The Borrower will provide such advisers
                and
                consultants with all information and documents which they may from
                time to
                time reasonably require and will reimburse the Agent on demand for
                all
                reasonable costs and expenses incurred by the Agent in connection
                with the
                consultation or retention of such advisers or
                consultants.

            

    

     

    
      	 	
              18.8

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

            

    

     

    
      	 	
              18.9

            	
              Rights
                etc. cumulative Every
                right, power, discretion and remedy conferred on the Finance Parties
                under
                or pursuant to the Security Documents shall be cumulative and in
                addition
                to every other right, power, discretion or remedy to which they may
                at any
                time be entitled by law or in equity. The Finance Parties may exercise
                each of their rights, powers, discretions and remedies as often and
                in
                such order as they deem appropriate subject to obtaining the prior
                written
                consent of the Majority Banks. The exercise or the beginning of the
                exercise of any right, power, discretion or remedy shall not be
                interpreted as a waiver of the right to exercise any other right,
                power,
                discretion or remedy either simultaneously or
                subsequently.

            

    

     

    
      
        
        

      

      
        85

        
          

        

      

      
        
        

      

    

    
      	 	
              18.10

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

            

    

     

    
      	 	
              18.11

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

            

    

     

    
      	 	
              18.12

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

            

    

     

    
      	 	
              18.13

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

            

    

     

    
      	 	
              18.14

            	
              No
                liability None
                of the Finance Parties, nor any agent or employee of any Finance
                Party,
                nor any receiver and/or manager appointed by the Agent, shall be
                liable
                for any losses which may be incurred in or about the exercise of
                any of
                the rights, powers, discretions or remedies of the Finance Parties
                under
                or pursuant to the Security Documents nor liable as mortgagee in
                possession for any loss on realisation or for any neglect or default
                of
                any nature for which a mortgagee in possession might otherwise be
                liable
                unless such Finance Party’s action constitutes gross negligence or wilful
                misconduct.

            

    

     

    
      
        
        

      

      
        86

        
          

        

      

      
        
        

      

    

    
      	 	
              18.15

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

            

    

     

    
      	 	
              18.16

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

            

    

     

    
      	 	
              18.17

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

            

    

     

    
      	 	
              18.18

            	
              Certificates
                Any
                certificate or statement signed by an authorised signatory of the
                Agent
                purporting to show the amount of the Indebtedness (or any part of
                the
                Indebtedness) or any other amount referred to in any of the Security
                Documents shall, save for manifest error or on any question of law,
                be
                conclusive evidence as against the Borrower of that amount.
                

            

    

     

    
      	 	
              18.19

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

            

    

     

    
      
        
        

      

      
        87

        
          

        

      

      
        
        

      

    

    
      	 	
              18.20

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

            

    

     

    
      	 	
              18.21

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

            

    

     

    
      	19  	
              Law and Jurisdiction

            

    

     

    
      	 	
              19.1

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

            

    

     

    
      	 	
              19.2

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

            

    

     

    
      	 	
              19.3

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

            

    

     

    
      	 	
              19.4

            	
              Service
                of process Without
                prejudice to the right of the Finance Parties to use any other method
                of
                service permitted by law, the Borrower irrevocably agrees that any
                writ,
                notice, judgment or other legal process shall be sufficiently served
                on it
                if addressed to it and left at or sent by post to the Address for
                Service,
                and in that event shall be conclusively deemed to have been served
                at the
                time of leaving or, if posted, at 9.00 a.m. on the third Business
                Day
                after posting by prepaid first class registered
                post.

            

    

     

    
      
        
        

      

      
        88

        
          

        

      

      
        
        

      

    

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

     

    
      
        
        

      

      
        89

        
          

        

      

      
        
        

      

    

    SCHEDULE
      1

     

    The
      Banks, the Commitments and the Proportionate Shares

     

    

    
      	
              The
                Banks

            	
              The
                Commitments ($)

            	
              The
                Proportionate Shares (%)

            
	
              DnB
                NOR BANK ASA

            	
              $21,600,000

            	
              72%

            
	
              THE
                ROYAL BANK OF SCOTLAND PLC

            	
              $8,400,000

            	
              28%

               

            

    

    

    
      
        
        

      

      
        90

        
          

        

      

      
        
        

      

    

    SCHEDULE
      2

     

    The
      Vessels

     

    

    
      	
              Owner

               

            	
              Country
                of Incorporation

               

            	
              Vessel

               

            	
              Flag

               

            
	
              GulfMark
                Rederi AS

               

            	
              Norway

               

            	
              "NORTH
                CHALLENGER"

               

            	
              Norway

               

            
	
              GulfMark
                Rederi AS

               

            	
              Norway

               

            	
              "NORTH
                TRAVELLER"

               

            	
              Norway

               

            
	
              GulfMark
                Rederi AS

               

            	
              Norway

               

            	
              "NORTH
                STREAM"

               

            	
              Norway

               

            
	
              GulfMark
                Rederi AS

               

            	
              Norway

               

            	
              "NORTH
                MARINER"

               

            	
              Norway

               

            

    

    

     

    
      
        
        

      

      
        91

        
          

        

      

      
        
        

      

    

    SCHEDULE
      3

     

    Form
      of Transfer Certificate

     

    To:
       DnB
      NOR
      Bank ASA as agent (the "Agent")

    The
      Royal
      Bank of Scotland plc (the "Bank")

    

    TRANSFER
      CERTIFICATE

    

    This
      transfer certificate relates to a facility agreement (as the same may be from
      time to time amended, varied, novated or supplemented, the "Facility
      Agreement")
      dated
                              
2006 whereby an initial reducing revolving credit facility of up to $30,000,000
      was made available to GulfMark Rederi AS by a group of banks on whose behalf
      the
      Agent acts as agent and security trustee.

    

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

            

    

    

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

            

    

    

    
      	3  	
              The
                Transferee requests the Agent and the Bank to accept this Transfer
                Certificate as being delivered to the Agent and the Bank pursuant
                to and
                for the purposes of clause 14.4 of the Facility Agreement so as to
                take
                effect in accordance with the terms thereof on the Transfer Date
                or on
                such later date as may be determined in accordance with the terms
                thereof.

            

    

    

    
      	4  	
              The
                Transferee confirms that it has received a copy of the Facility Agreement
                together with such other information as it has required in connection
                with
                this transaction and that it has not relied and will not in the future
                rely on the Existing Bank or any other party to the Facility Agreement
                to
                check or enquire on its behalf into the legality, validity,
                

            

    

    
      
        
        

      

      
        92

        
          

        

      

      
        
        

      

    

    effectiveness,
      adequacy, accuracy or completeness of any such information and further agrees
      that it has not relied and will not rely on the Existing Bank or any other
      party
      to the Facility Agreement to access or keep under review on its behalf the
      financial condition, creditworthiness, condition, affairs, status or nature
      of
      the Borrower or any other party to the Facility Agreement.

    

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

            

    

    

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

            

    

    

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

            

    

    

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

            

    

    
      
        
        

      

      
        93

        
          

        

      

      
        
        

      

    

    

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

            

    

    THE SCHEDULE

    

    
      	1  	
              Existing
                Bank:

            

    

    

    
      	2  	
              Transferee:

            

    

    

    
      	3  	
              Transfer
                Date:

            

    

    

    
      	4  	
              Existing
                Bank's Commitment1:Portion
                Transferred

            

    

    

    

    [Transferor
      Bank]    [Transferee
      Bank]

    

    By:      By:

    

    Date:      Date:

    

    DnB
      NOR Bank ASA

    

    As
      agent
      for and on behalf of itself,

    the
      Borrower and the other Finance Parties (with the exception of the
      Banks):-

    

    By:
      ..........................................

    

    Date:
      [    ]

    

    

    The
      Royal Bank of Scotland plc

    

    By:
      ..........................................

    

    Date:
      [    ]

    

    

    1
      Details
      of the Bank's Commitment should not be completed after the Termination
      Date.

    

    

    
      
        
        

      

      
        94

        
          

        

      

      
        
        

      

    

    SCHEDULE
      4

     

    Form
      of Drawdown Notice

     

    

    
      	
              To:

            	
              DnB
                NOR Bank ASA

            

    

    

    

    From: GULFMARK
      REDERI AS

    

    [Date]

    

    Dear
      Sirs,

    Drawdown
      Notice

    

    We
      refer
      to the Revolving Credit Facility Agreement dated
                                    2006
      made between, amongst others, ourselves and yourselves ("the
      Agreement").

    

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

    

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

     

    We
      warrant that the representations and warranties contained in Clause 4 of the
      Agreement other than those in clause 4.9 [and clause 4.17]2 
      are true
      and correct at the date of this Drawdown Notice and will be true and correct
      on
             
200[ ]; that no Event of Default nor Potential Event of Default has
      occurred and is continuing, and that no Event of Default or Potential Event
      of
      Default will result from the advance of the Drawing requested in this Drawdown
      Notice. 

    

    [We
      further confirm and certify that no material adverse change has occurred since
      the Execution Date in the business, assets, operations, condition (financial
      or
      otherwise) or prospects of the Borrower or its subsidiaries or in the facts
      and
      information regarding such entities as represented to date3 ].

     

    2
      To be in
      subsequent Drawdown Notices only.

    3
      To be in
      first Drawdown Notice only.

    
      
        
        

      

      
        95

        
          

        

      

      
        
        

      

    

    

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

    

    Yours
      faithfully

    

    

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

    For
      and
      on behalf of

    GULFMARK
      REDERI AS

     

    
      
        
        

      

      
        96

        
          

        

      

      
        
        

      

    

    SCHEDULE
      5

     

    Calculation
      of the Mandatory Cost

     

    
      	
              1

            	
              The
                Mandatory Cost is an addition to the interest rate to compensate
                the Banks
                for the cost of compliance with (a) the requirements of the Bank
                of
                England and/or the Financial Services Authority (or, in either case,
                any
                other authority which replaces all or any of its functions) or (b)
                the
                requirements of the European Central
                Bank.

            

    

     

    
      	
              2

            	
              On
                the first day of each Interest Period (or as soon as possible thereafter)
                the Agent shall calculate, as a percentage rate, a rate (the "Additional
                Cost Rate")
                for each Bank, in accordance with the paragraphs set out below. The
                Mandatory Cost will be calculated by the Agent as a weighted average
                of
                the Banks' Additional Cost Rates (weighted in proportion to the percentage
                participation of each Bank in the Loan) and will be expressed as
                a
                percentage rate per annum.

            

    

     

    
      	
              3

            	
              The
                Additional Cost Rate for any Bank lending from a Facility Office
                in a
                Participating Member State will be the percentage notified by that
                Bank to
                the Agent. This percentage will be certified by that Bank in its
                notice to
                the Agent to be its reasonable determination of the cost (expressed
                as a
                percentage of that Bank's participation in all loans made from that
                Facility Office) of complying with the minimum reserve requirements
                of the
                European Central Bank in respect of loans made from that Facility
                Office.

            

    

     

    
      	
              4

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

            

    

     

    
                               
        per cent. per annum.
E
      x
      0.01

    300 

     

    
      	 	
              Where
                E is the rate of charge payable by a Bank to the Financial Services
                Authority under the Fees Rules in respect of the relevant financial
                year
                of the Financial Services Authority (calculated for this purpose
                by the
                Agent as being the average of the Fee Tariffs applicable to that
                Bank for
                that financial year).

            

    

     

    5 For
      the
      purposes of this Schedule:

     

    
      	 	
              (a)

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

            

    

     

    
      
        
        

      

      
        97

        
          

        

      

      
        
        

      

    

    
      	 	
              (b)

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

            

    

     

    
      	 	
              (c)

            	
              "Fee
                Rules"
                means the rules on periodic fees contained in the FSA Supervision
                Manual
                or such other law or regulation as may be in force from time to time
                in
                respect of the payment of fees for the acceptance of
                deposits;

            

    

     

    
      	 	
              (d)

            	
              "Fee
                Tariffs"
                means the fee tariffs specified in the Fees Rules under the activity
                group
                A.1 Deposit acceptors (ignoring any minimum fee or zero rated fee
                required
                pursuant to the Fee Rules but taking into account any applicable
                discount
                rate); and

            

    

     

    
      	 	
              (e)

            	
              "Participating
                Member State"
                means any member state of the European Communities that adopts or
                has
                adopted the euro as its lawful currency in accordance with legislation
                of
                the European Union relating to European Monetary
                Union;

            

    

     

    
      	 	
              (f)

            	
              "Parties"
                means any party to the Agreement, including its successors in title
                permitted assigns and permitted transferees;
                and

            

    

     

    
      	 	
              (g)

            	
              "Tariff
                Base"
                has the meaning given to it in, and will be calculated in accordance
                with,
                the Fees Rules.

            

    

     

    
      	
              6

            	
              If
                requested by the Agent, each Bank shall, as soon as practicable after
                publication by the Financial Services Authority, supply to the Agent,
                the
                rate of charge payable by that Bank to the Financial Services Authority
                pursuant to the Fees Rules in respect of the relevant financial year
                of
                the Financial Services Authority (calculated for this purpose by
                that Bank
                as being the average of the Fee Tariffs applicable to that Bank for
                that
                financial year).

            

    

     

    
      	
              7

            	
              Each
                Bank shall supply any information required by the Agent for the purpose
                of
                calculating its Additional Cost Rate. In particular, but without
                limitation, each Bank Shall supply the following information on or
                prior
                to the date on which it becomes a
                Bank:

            

    

     

    (a) the
      jurisdiction of its Facility Office; and

     

    (b) any
      other
      information that the Agent may reasonably require for such purpose.

     

    Each
      Bank
      shall promptly notify the Agent of any change to the information provided by
      it
      pursuant to this paragraph.

     

    
      
        
        

      

      
        98

        
          

        

      

      
        
        

      

    

    
      	
              8

            	
              The
                percentages of each Bank for the purpose of E above shall be determined
                by
                the Agent based upon the information supplied to it pursuant to paragraphs
                6 and 7 above and on the assumption that, unless the Bank notifies
                the
                Agent to the contrary, each Bank's obligations in relation to cash
                ratio
                deposits and Special Deposits are the same as those of a typical
                bank from
                its jurisdiction of incorporation with a Facility Office in the same
                jurisdiction as in its Facility
                Office.

            

    

     

    
      	
              9

            	
              The
                Agent shall have no liability to any person if such determination
                results
                in an Additional Cost Rate which over or under compensates any Bank
                and
                shall be entitled to assume that the information provided by any
                Bank
                pursuant to paragraphs 3, 6 and 7 above is true and correct in all
                respects.

            

    

     

    
      	
              10

            	
              The
                Agent shall distribute the additional amounts received as a result
                of the
                Mandatory Cost to the Banks on the basis of the Additional Cost Rate
                for
                each Bank based on the information provided by each Bank pursuant
                to
                paragraphs 3, 6 and 7 above.

            

    

     

    
      	
              11

            	
              Any
                determination by the Agent pursuant to this Schedule in relation
                to a
                formula, the Mandatory Cost, an Additional Cost Rate or any amount
                payable
                to a Bank shall, in the absence of manifest error, be conclusive
                and
                binding on all Parties.

            

    

     

    
      	
              12

            	
              The
                Agent may from time to time, after consultation with the Borrower
                and the
                Banks determine and notify to all Parties any amendments which are
                required to be made to this Schedule in order to comply with any
                change in
                law, regulation or any requirements from time to time imposed by
                the Bank
                of England, the Financial Services Authority or the European Central
                Bank
                (or, in any case, any other authority which replaces all or any of
                its
                functions) and any such determination shall, in the absence of manifest
                error, be conclusive and binding on all
                Parties.

            

    

     

    
      
        
        

      

      
        99

        
          

        

      

      
        
        

      

    

    SCHEDULE
      6

     

    Form
      of Compliance Certificate

     

    To: DnB
      NOR
      Bank ASA (the "Agent")

    From: GulfMark
      Rederi AS

    

    Date:
      [Ÿ]

    

    

    Dear
      Sirs,

     

    We
      refer
      to an agreement (the "Agreement")
      dated
      [                        ]
      2006 and made between (inter alia) (1) ourselves as borrower (2) the banks
      and
      financial institutions listed in Schedule 1 of the Agreement as banks and (3)
      the Agent as the agent and security trustee (as from time to time amended,
      varied, novated or supplemented).

     

    Terms
      defined or construed in the Agreement have the same meanings and constructions
      in this Certificate.

     

    We
      attach
      the relevant calculation details applicable on the last day of our financial
      [year][quarter] ending [Ÿ]
      (the
      "Relevant
      Period")
      which
      confirm that:-

     

    
      	
              1.

            	
              The
                Guarantor's Total Shareholder Equity is
                [          ], and the
                Guarantor's Total Assets are
                [          ]. As such
                the ratio of Total Shareholder Equity to Total Assets is
                [          ].

            

    

     

    
      	
              2.

            	
              The
                Guarantor's EBITDA is
                [          ] and the
                Guarantor's Interest Expense is
                [          ]. As such
                the Guarantor's ratio of EBITDA to Interest Expense is
                [          ].

            

    

     

    
      	
              3.

            	
              We
                attach Valuations for each of the Vessels showing an aggregate Valuation
                of [          ]. As such
                the
                aggregate of: 

            

    

     

    
      	 	
              (a)

            	
              the
                Valuations of the Vessels; and

            

    

     

    
      	 	
              (b)

            	
              the
                value of any additional security acceptable to the Agent in its absolute
                discretion for the time being provided to the Banks (or to the Agent
                on
                their behalf) pursuant to
                Clause 10.2.16,

            

    

     

    is
      [    ]% of the Maximum Facility Amount.

     

    
      
        
        

      

      
        100

        
          

        

      

      
        
        

      

    

    

    Signed:  ........................................

    Duly
      authorised representative of

    GULFMARK
      REDERI AS

    

    
      
        
        

      

      
        101

        
          

        

      

      
        
        

      

    

    SCHEDULE
      7

     

    Calculation
      of Effective Interest

     

    The
      Norwegian Financial Agreements Act of 25 June 1999 (the "Financial
      Agreements Act")
      contains a number of detailed and mandatory requirements concerning inter alia
      information, which has to be documented within a contractual relationship,
      irrespective of whether the client of the financial institution is a consumer
      or
      a professional or commercial organisation. 

     

    One
      important aspect of The Financial Agreements Act is that the Banks are required
      to confirm to the Borrower the effective
      annual interest rate.
      

     

    A
      calculation of the effective annual interest rate is subject to both a fixed
      nominal interest rate and a fixed utilisation rate. Since the interest is based
      on LIBOR and such rate may vary, and a Drawing may be subject to varying
      Interest Periods, the Agent cannot state one effective annual interest rate
      for
      the Facility Period. According to regulations issued under the Financial
      Agreement Act, it is however deemed sufficient that the Borrower is informed
      of
      and has agreed to a representative sample in respect of the calculation of
      the
      effective annual interest rate. An illustration of the calculation, subject
      to
      the following theoretical assumptions, will be: 

     

    Total
      facility amount: USD
      30,000,000

     

    LIBOR,
      6
      months: 5.309%
      p.a. 

     

    Margin: As
      defined in this Agreement

     

    Fees: As
      specified in a separate Fee Letter

     

    Drawdown
      Date: 8
      June
      2006

     

    Effective
      annual interest rate, based on the above-mentioned assumptions, is calculated
      to
      6.375% p.a.

     

    Above
      calculations are intended as examples only.

     

    By
      our
      signature to this Agreement we, GulfMark Rederi AS, hereby confirm that we
      understand and accept the basis of calculation of the effective annual interest
      rate and the contents of the samples, which form a part of the
      Agreement.

     

    

    
      
        
        

      

      
        102

        
          

        

      

      
        
        

      

    

    

      

      
        	
                SIGNED
                  by

                duly
                  authorised for and on behalf 

                of
                  DnB
                  NOR Bank ASA

                (as
                  Agent, MLA, Issuer and Bank)

                in
                  the presence of:- Ania Lipinski

              	
                )

                )

                )

                )

                )

              	
                /s/
                  M.A. Russell

                 

                /s/
                  Ania Lipinski

                Stephenson
                  Harwood

                One,
                  St. Paul’s Churchyard

                London
                  EC4M 8SH

                 

              
	
                SIGNED
                  by

                duly
                  authorised for and on behalf 

                of
                  THE
                  ROYAL BANK OF SCOTLAND PLC

                (as
                  Bank)

                in
                  the presence of:- Ania Lipinski

              	
                )

                )

                )

                )

                )

              	
                /s/
                  Ian Mace

                 

                /s/
                  Ania Lipinski

                Stephenson
                  Harwood

                One,
                  St. Paul’s Churchyard

                London
                  EC4M 8SH

                 

              
	
                SIGNED
                  by
                  B. Streeter

                duly
                  authorised for and on behalf 

                of
                  GULFMARK
                  REDERI AS

                in
the
                  presence of:- 

              	
                )

                )

                )

                )

                )

              	
                /s/
                  Bruce Streeter

                 

                /s/
                  Mary Kay Kutka

                Mary
                  Kay Kutka

                10111
                  Richmond Ave., Ste. 340

                Houston,
                  TX 77042

              

      

      

    

    

    

    

    
      
        
        

      

      
        103

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