Document:

Guarantee, dated April 7, 2006

 Exhibit 10.2 
 EXECUTION COPY 
 GUARANTEE 
 This GUARANTEE (this “Guarantee”) dated as of April 7, 2006, made by Horizon Lines, Inc., a Delaware corporation, in favor of each of HL Tiger LLC, HL Hunter LLC, HL Hawk LLC, HL Falcon LLC and HL Eagle
LLC (collectively, the “Owners” and each individually an “Owner”). 
 WHEREAS, the Owners have agreed that, upon the
purchase of the Vessels by SFL Holdings from the Sellers, the Owners shall purchase the Vessel from SFL Holdings and, simultaneously with such sale, let and demise the Vessel to the Charterer; and 
 WHEREAS, in order to induce the Owners to enter into the Transaction Documents (as defined in each Charter referred to below to which each Owner is a
party) to which it is a party, the Guarantor has agreed to extend this Guarantee in favor of the Owners. 
 NOW, THEREFORE, in consideration
of the Owners entering into the Transaction Documents to which it is a party, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Guarantor, intending to be legally bound, hereby covenants and
agrees as follows: 
 SECTION 1. Definitions and Rules of Interpretation. All terms used in this Guarantee which are not otherwise
defined in this Guarantee shall have the respective meanings given in the bareboat charter (the “Charter”) between Horizon Lines, LLC, as the Charterer and HL Eagle LLC, as Owner, dated as of the date hereof, which Charter is incorporated
herein by reference as if fully set forth herein. The rules of interpretation set forth in the Charter apply mutatis mutandis to this Guarantee. 
 SECTION 2. Guarantee. The Guarantor, as primary obligor and not merely as surety, hereby irrevocably, absolutely and unconditionally guarantees to the Owners and their successors and permitted assigns: (a) the prompt and
complete payment by the Charterer, as and when due and payable (whether by demand or otherwise), of all obligations and liabilities of the Charterer to the Owners now existing or hereafter incurred under or arising out of or in connection with the
Transaction Documents to which the Charterer is a party, whether for Hire, fees, expenses or otherwise and all other obligations and liabilities of any kind of the Charterer in connection with the transactions contemplated by the Transaction
Documents and any agreement, instrument or certificate relating thereto to the Owners (including any liabilities (for damages or otherwise) of the Charterer in respect of any breach by the Charterer of any of its representations, warranties and
covenants in any Transaction Document to which it is party) and (b) the due, prompt and faithful performance of, and compliance with, all other obligations, covenants, terms, conditions and undertakings of the Charterer contained in the
Transaction Documents to which it is a party and any agreement or instrument or certificate relating thereto (all such obligations, liabilities, covenants, terms and conditions and undertakings referred to in clauses (a) and (b) above
being herein called the “Obligations”); and agrees to pay on demand any and all Expenses which may be paid or incurred by any Owner in enforcing, or obtaining advice of 

 counsel in respect of, any rights with respect to, or collecting, any or all of the Obligations and/or enforcing any
rights under this Guarantee or under the Obligations including any Expenses incurred in connection with any bankruptcy proceeding involving the Charterer or the Guarantor. 
 SECTION 3. The Guarantor’s Obligations Absolute and Unconditional. 
 (a) The Guarantor hereby guarantees that the Obligations will be paid and performed strictly in accordance with the terms of the Transaction Documents to
which the Charterer is a party, regardless of any Applicable Law now or hereafter in effect in any jurisdiction affecting any such terms or the rights of any Owner with respect thereto. This Guarantee is a guarantee of payment and performance and
not of collection and the obligations and liabilities of the Guarantor under this Guarantee shall be absolute and unconditional irrespective of: (i) any lack of validity or enforceability of any of the Obligations, the Transaction Documents
(other than due to fraud or misrepresentation of any Owner) or any agreement, instrument or certificate relating thereto, or any delay, failure or omission to enforce or agreement not to enforce, or the stay or enjoining by order of court, by
operation of law or otherwise of the exercise of, any right with respect to the foregoing (including in each case, without limitation, as a result of the insolvency, bankruptcy or reorganization of the Charterer, any Owner or any other Person);
(ii) any change in the time, manner or place of payment of, or in any other term in respect of, all or any of the obligations, or any other amendment or waiver of or consent to any departure from any Transaction Document or any agreement,
instrument or certificate relating thereto; (iii) any claim, set-off, counterclaim, defense or other rights which the Chartere or Guarantor may have at any time and from time to time against any Owner or any other Person, whether in connection
with the transactions contemplated by the Transaction Documents or any unrelated transaction; (iv) any insolvency, bankruptcy, reorganization, arrangement, composition, liquidation, dissolution or similar proceedings with respect to the
Charterer or any other Person; or (v) any other circumstance which might otherwise constitute a defense available to, or a discharge of, the Charterer or any other guarantor or surety in respect of the Obligations or the Guarantor in respect of
this Guarantee. 
 (b) This Guarantee (i) is a continuing guarantee and shall remain in full force and effect until the payment or
performance in full of the Obligations due and owing the Owners and the payment of the other expenses to be paid by the Guarantor pursuant hereto; and (ii) shall continue to be effective or shall be reinstated, as the case may be, if at any
time any payment, or any part thereof, of any of the Obligations are rescinded or must otherwise be returned or reimbursed by any Owner upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of the Charterer or otherwise, all as
though such payment had not been made. 
 (c) The obligations and liabilities of the Guarantor under this Guarantee shall not be conditioned
or contingent upon the pursuit by any Owner of any right or remedy against the Charterer which may be or become liable in respect of all or any part of the Obligations or against any collateral security or guarantee therefor or right of set off with
respect thereto. 
 (d) The Guarantor hereby consents that , without the necessity of any reservation of rights against the Guarantor and
without notice to or further assent by the Guarantor, any demand for payment of any of the Obligations made by any Owner may be rescinded by such Owner and any of the Obligations continued after such rescission. 
  

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 SECTION 4. Waivers. The Guarantor hereby unconditionally waives: (a) promptness and
diligence; (b) notice of or proof of reliance by any Owner upon this Guarantee or acceptance of this Guarantee; (c) notice of the incurrence of any Obligation by the Charterer or the renewal, extension or accrual of any Obligation;
(d) notice of any actions taken by any Owner or the Charterer under the Transaction Documents or any other agreement, instrument or certificate relating thereto; and (e) all other notices, demands and protests, and all other formalities of
every kind in connection with enforcement of the Obligations or of the obligations of the Guarantor hereunder, the omission of or dalay in which, but for the provisions of this Section 4, might constitute grounds for relieving the Guarantor of
its obligations hereunder. 
 SECTON 5. Waiver of Subrogation Rights by the Guarantor. The Guarantor hereby acknowledges and agrees
that under no circumstances shall the Guarantor be entitled to be subrogated to any rights of any Owner in respect of the obligations performed by the Guarantor hereunder or otherwise, and the Guarantor hereby expressly and irrevocably waives each
and every such right of subrogation and any claims, reimbursements, right or right of action relating thereto (howsoever arising). The Guarantor hereby further acknowledges and agrees that no payment or performance hereunder by the Guarantor shall
give rise to any claim of the Guarantor against any Owner. 
 SECTION 6. Representations and Warranties of the Guarantor. The
Guarantor represents and warrants, as of the date hereof, to the Owners as follows: 
 (a) the Guarantor is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware and has the corporate power and authority to carry on its businesses as presently conducted, to own its properties and to enter into and to perform its obligations under
this Guarantee and has not failed to qualify to do business in any jurisdiction where failure so to qualify would materially and adversely affect its financial condition or its ability to perform its respective obligations under this Guarantee;

 (b) the execution, delivery and performance by the Guarantor of this Guarantee have been duly authorized by all necessary corporate
action, do not contravene any Applicable Law presently binding on the Guarantor, and do not and will not contravene the provisions of, or constitute a default under, its certificate of incorporation or by-laws or any indenture, mortgage, chattel
mortgage, deed of trust, conditional sales contract, lease, loan or other material contract, agreement or instrument to which it is a party by which it or any of its properties is or may be bound or affected and which would have a material adverse
effect on the ability of the Guarantor to perform its obligations under this Guarantee; 
 (c) the execution, delivery and performance by the
Guarantor of this Guarantee do not require the consent, approval, authorization, or order of, or giving of notice to, or registration with, or taking of any other action in respect of, any Governmental Entity, other than such consents, approvals,
authorizations, orders, registrations, notices or actions the failure 
  

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 of which to obtain would not have a Material Adverse Effect on the Guarantor, or a material adverse effect upon its
ability to perform any of its obligations under this Guarantee; provided, if any of the foregoing are not required hereby or by the other Transaction Documents or by Applicable Law to be obtain, given or taken on or before Closing Date, the
same will be made or obtained in the ordinary course of business when required; and 
 (d) this Guarantee has been duly executed and
delivered by the Guarantor and constitutes the legal, valid and binding obligation of the Guarantor, duly enforceable against the Guarantor in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or
other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law. 
 (e) the audited consolidated balance sheets of the Guarantor and its Consolidated Subsidiaries as of December 25, 2005, and the related audited statement of its earnings and cash flows for the period then ended,
have been prepared in accordance with GAAP and fairly present the financial condition of the Guarantor and its consolidated subsidiaries taken as a whole as of such dates and the results of operations for the fiscal period then ended. 
  

	 	(f)	the Guarantor owns indirectly all the issued and outstanding capital stock or membership interests of the Charterer; 

 SECTION 7. Financial Information. (a) Within 10 days of the filing thereof with the Securities and Exchange Commission (“SEC”) or,
if the Guarantor is not required to file such financial statements with the SEC, within 120 days of the Guarantor’s fiscal year-end, a copy of the audited annual financial statements of the Guarantor shall be delivered to the Owners,
provided that this covenant shall be deemed to have been fulfilled by the posting on the Guarantor’s website of such financial statements. 
 (b) Within 10 days of the filing thereof with the SEC or, if the Guarantor is not required to file such financial statements with the SEC, within 60 days of the Guarantor’s fiscal quarter then ended, a copy of
the unaudited quarterly financial statements for such fiscal quarter shall be delivered to the Owners, provided that this covenant shall be deemed to have been fulfilled by the posting on the Guarantor’s website of such financial
statements. 
 SECTION 8. Consolidation or Merger. The Guarantor shall not acquire a Person or consolidate or merge with or into any
other Person or sell, convey, assign, transfer, charter or otherwise dispose of substantially all of its property to any Person unless: 
  

	 	(A)	either (x) the Guarantor is the surviving Person; or (y) the Person formed by or surviving any such consolidation, charter or merger (if other than the Guarantor) or to
which such sale, conveyance, assignment, transfer or other disposition has been made expressly assumes all the obligations of the Guarantor under the Guarantee and other Transaction Documents; and 

  

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	 	(b)	the surviving Person who is the Guarantor remains in compliance with the terms and provisions of this Guarantee and the other Transaction Documents. 

 This Section 8 shall not apply to a merger or consolidation, or sale, conveyance, assignment, transfer, charter or other disposition of the
Guarantor with an Affiliate solely for the purpose, and with the effect, of reincorporating the Guarantor in another jurisdiction of the United States. 
 SECTION 9. Notices. Every notice, request or demand or other communication under this Guarantee shall: be in writing (whether or not any such communication is specified to be in writing) and in the English
language and delivered personally, by certified mail or by prepaid courier delivery services such as Federal Express, DHL or other similar services or facsimile (confirmed in the case of a facsimile, by prepaid airmail letter sent within 24 hours of
dispatch); and be deemed to have been received, in the case of a facsimile, at the time of dispatch with a transmission confirmation appearing at the end of the communication (provided, however, that, in the case of a facsimile, if the date of
dispatch is not a business day in the state of the addressee it shall be deemed to have been received at the opening of business on the next such business day) and, in the case of a letter, when delivered personally or by courier; provided, however,
that if personal delivery or delivery by courier of a notice is tendered but refused, such notice, shall be effective upon such tender; 
  

	 	(a)	be sent if: 

  

	 	(1)	to any Owner to: 

 c/o Ship Finance
International Limited 
 P.O. Box HM 1593 
 Par-la-Ville Place 
 14 Par-la-Ville Road 
 Hamilton HM08 Bermuda 
 Attention: Vice President Finance 
 Facsimile: (441) 295-3494 
 with a copy to: 
 Seward & Kissel LLP 
 One Battery Park Plaza 
 New York, New York 10004 
 Attention: Gary J. Wolfe 
 Facsimile: (212) 480-8421 
  

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	 	(2)	to the Guarantor to: 

 Horizon Lines, Inc.

 4064 Colony Road, Suite 200 
 Charlotte, NC 28211 
 Attention: Mark Urbania 
 Facsimile: (704) 973-7010 
 Telephone: (704) 973-7049 
 or to such other addressee or facsimile number as may be
notified by one party to the other parties under this Guarantee. 
 SECTION 10. Miscellaneous. 
 (a) The Guarantor will make each payment hereunder in lawful money of the United States and in immediately available funds to the applicable Owner at its
address specified in Section 12 of this Guarantee or to such other address as such Owner may designate for itself by like notice. 
 (b)
No amendment of any provision of this Guarantee shall be effective unless it is in writing and signed by the Guarantor and each of the Owners, and no waiver of any provision of this Guarantee, and no consent to any departure by the Guarantor
therefrom, shall be effective unless it is in writing and signed by each of the Owners as to itself, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. 
 (c) No failure on the part of the Owners to exercise, and no delay in exercising any right hereunder, shall operate as a waiver hereof. The rights and
remedies provided herein are cumulative and not exclusive of any remedies provided by law. 
 (d) Any provision of this Guarantee which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting the validity or enforceability of
such provision in any other jurisdiction. 
 (e) This Guarantee (i) shall be binding in accordance with and to the extent of its terms
upon the Guarantor and its successors and assigns, (ii) shall inure, together with all rights and remedies hereunder, to the benefit of Owners and their respective successors and permitted assigns and (iii) may be assigned by the Owners to
the Security Trustee under the Credit Agreement to secure its obligations to the Lenders under the Credit Agreement. 
 (f) GOVERNING LAW;
SUBMISSION TO JURISDICTION; VENUE. 
 (i) THIS GUARANTEE SHALL IN ALL RESPECTS BE GOVERNED BY THE LAWS OF THE STATE OF NEW
YORK, INCLUDING ALL 

  

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MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAWS THEREOF. THIS GUARANTEE IS BEING DELIVERED IN THE
STATE OF NEW YORK. 
 (ii) EACH PARTY HEREBY AGREES THAT ANY SUIT, ACTION OR PROCEEDING UNDER OR ARISING OUT OF OR RELATING TO
THIS GUARANTEE OR ANY OTHER TRANSACTION DOCUMENT MAY BE INSTITUTED IN THE FEDERAL COURTS LOCATED IN THE SOUTHERN DISTRICT OF NEW YORK OR THE COURTS OF THE STATE OF NEW YOU LOCATED IN NEW YORK COUNTY, AND EACH PARTY HEREBY IRREVOCABLY WAIVES ANY
OBJECTION WHICH IT MAY HAVE NOW OR HEREAFTER TO THE LAYING OF THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING, INCLUDING THAT ANY SUCH SUIT, ACTION OR PROCEEDING HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. EACH PARTY HEREBY IRREVOCABLY SUBMITS TO
THE NON-EXCLUSIVE JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING, PROVIDED, THAT NOTHING CONTAINED IN THIS SECTION 13(f) SHALL AFFECT THE RIGHTS OF ANY PERSON TO BRING ANY SUCH ACTION, SUIT OR PROCEEDING IN THE COURTS OF ANY
OTHER JURISDICTION. TO THE EXTENT THAT SUCH PERSON OR ANY OF ITS PROPERTY IS OR BECOMES ENTITLED AT ANY TIME TO ANY IMMUNITY ON THE GROUNDS OF SOVEREIGNTY OR OTHERWISE FROM ANY LEGAL ACTION SUIT OR PROCEEDING, FROM SET-OFF OR COUNTERCLAIM, FROM THE
JURISDICTION OF ANY COMPETENT COURT, FROM SERVICE OF PROCESS, FROM ATTACHMENT PRIOR TO JUDGMENT, FROM ATTACHMENT IN AID OF EXECUTION, OR FROM EXECUTION PRIOR TO JUDGMENT, OR OTHER LEGAL PROCESS IN ANY JURISDICTION, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, EACH PARTY FOR ITSELF AND ITS PROPERTY DOES HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE, AND AGREE NOT TO PLEAD OR CLAIM, ANY SUCH IMMUNITY WITH RESPECT TO ITS OBLIGATIONS, LIABILITIES OR ANY OTHER MATTER UNDER OR ARISING OUT OF OR
IN CONNECTION WITH THIS GUARANTEE OR ANY OTHER TRANSACTION DOCUMENT OR THE SUBJECT MATTER HEREOF OR THEREOF. SUCH AGREEMENT OR WAIVER SHALL BE IRREVOCABLE AND NOT SUBJECT TO WITHDRAWAL IN ANY AND ALL JURISDICTIONS INCLUDING UNDER THE FOREIGN
SOVEREIGN IMMUNITIES ACT OF 1976 OF THE UNITED STATES. EACH PARTY HEREBY GENERALLY CONSENTS TO THE SERVICE OF PROCESS AT ITS ADDRESS SPECIFIED FOR NOTICE IN SECTION 12. 
 (iii) EACH PARTY HEREBY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION IN ANY COURT IN ANY JURISDICTION BASED UPON OR
ARISING OUT OF OR RELATING TO THIS GUARANTEE. EACH PARTY ACKNOWLEDGES THAT THE WAIVER OF JURY TRIAL BY IT IN THIS SECTION 13(f)(iii) IS A MATERIAL INDUCEMENT TO THE 
  

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 OTHER PERSONS TO ENTER INTO A BUSINESS RELATIONSHIP WITH IT AND THAT SUCH PARTIES HAVE RELIED ON THIS
SECTION 13(f)(iii) IN ENTERING INTO THE TRANSACTION DOCUMENTS. 
 (iv) EACH PARTY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT
FINAL JUDGMENT AGAINST IT RENDERED BY SUCH COURTS IN ANY OF THE AFORESAID ACTIONS, SUITS OR PROCEEDINGS SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN ANY OTHER JURISDICTION, WITHIN OR WITHOUT THE UNITED STATES, BY SUIT ON THE JUDGMENT. A CERTIFIED OR
EXEMPLIFIED COPY OF WHICH SHALL BE CONCLUSIVE EVIDENCE OF THE FACT AND AMOUNT OF ITS OBLIGATIONS AND LIABILITIES. 
 (v) EACH
PARTY REPRESENTS AND WARRANTS THAT IT HAS REVIEWED THIS SECTION 13(f)(v) WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY ACCEPTS AND AGREES TO THIS SECTION 13(f) FOLLOWING CONSULTATION WITH SUCH LEGAL COUNSEL. THIS SECTION 13(f) IS
IRREVOCABLE AND UNCONDITIONAL AND SHALL APPLY TO ANY AMENDMENTS, SUPPLEMENTS OR MODIFICATIONS TO THIS GUARANTEE. 
 (g) Section heading in
this Guarantee are included in this Guarantee for the convenience of reference only and shall not constitute a part of the Guarantee for any other purpose. 
 (h) The Guarantor hereby agrees to execute and deliver all such instruments and to take all such action as the Owner or its permitted assigns, as applicable, may from time to time reasonably request in order to
effectuate fully the purposes of this Guarantee. 
  

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 IN WITNESS WHEREOF, the Guarantor has caused this Guarantee to be executed by an officer thereunto duly
authorized, as of the date first above written. 
  

			
	 HORIZON LINES, INC.

		
	 By:
	  	 /s/ M. Mark Urbania

	 Name:
	  	 M. Mark Urbania

	 Title:
	  	 Sr. Vice President & CFO

 Acknowledged, Accepted and Agreed to by: 
  

			
	 HL TIGER LLC

		
	 By:
	    	 /s/ Kenneth Becker

	 Name:
	    	 Kenneth Becker

	 Title:
	    	 Management Committee Member

	
	 HL HUNTER LLC

		
	 By:
	    	 /s/ Kenneth Becker

	 Name:
	    	 Kenneth Becker 

	 Title:
	    	 Management Committee Member

	
	 HL HAWK LLC

		
	 By:
	    	 /s/ Kenneth Becker

	 Name:
	    	 Kenneth Becker 

	 Title:
	    	 Management Committee Member

	
	 HL FALCON LLC

		
	 By:
	    	 /s/ Kenneth Becker

	 Name:
	    	 Kenneth Becker 

	 Title:
	    	 Management Committee Member

	
	 HL EAGLE LLC

		
	 By:
	    	 /s/ Kenneth Becker

	 Name:
	    	 Kenneth Becker 

	 Title:
	    	 Management Committee Member

  

 9Reimbursement Agreement

 Exhibit 10.3 
 REIMBURSEMENT AGREEMENT 
 THIS REIMBURSEMENT AGREEMENT (“Agreement”) is made and entered
into this 7th day of April 2006 by and among Horizon Lines, LLC, a Delaware limited liability company
(“HLL”), Ship Finance International Limited, a Bermuda company (“SFL”), SFL Holdings LLC, a Delaware limited liability company (“SFL Holdings”), and the five companies listed in Appendix 1 hereto, each a Delaware
limited liability company and direct wholly-owned subsidiary of SFL Holdings (each an “Owner” and collectively, the “Owners”). 
 RECITALS 
 WHEREAS, pursuant to an Agreement to Acquire and Charter, dated the date hereof (the “Agreement to Acquire
and Charter”), among SFL, SFL Holdings, the Owners and HLL, SFL will, among other things, cause SFL Holdings to purchase five 2,824 TEU containerships (each a “Vessel” and collectively, the “Vessels”), and upon the purchase
of each Vessel by SFL Holdings, SFL Holdings will immediately sell the Vessel to the intended Owner thereof for an amount equal to the Adjusted Average Purchase Price (as defined in the Agreement to Acquire and Charter) of the Vessel and the Owners
will, in turn, demise charter the Vessels to HLL under the terms of five separate bareboat charter parties, dated the date hereof (each a “Charter” and, collectively, the “Charters”), each between one of the Owners and HLL (the
foregoing transactions being, collectively, the “Transactions”); 
 WHEREAS, the Vessels will be built by Hyundai MIPO Dockyard
Co., Ltd., a Korean company (the “Builder”), under five separate Shipbuilding Contracts, two of which are with wholly-owned subsidiaries of E.R. Schiffahrt GMBH & Cie. KG (“ER”; each such wholly-owned subsidiary, an
“ER Subsidiary”), and three of which are with wholly-owned subsidiaries of Tsakos Shipping & Trading S.A. (“Tsakos”; each such wholly-owned subsidiary, a “Tsakos Subsidiary”; each ER Subsidiary and Tsakos
Subsidiary, a “Seller” and such subsidiaries, collectively, the “Sellers”); 
 WHEREAS, SFL Holdings has entered into
five separate Memoranda of Agreement, each dated the date hereof (each an “MOA” and, collectively, the “MOAs”), pursuant to which SFL Holdings has agreed to purchase, and the Seller party thereto has agreed to sell, the Vessel
covered by such MOA; 
 WHEREAS, each MOA with an ER Subsidiary requires that SFL Holdings deliver a cash deposit to the relevant Seller
(each a “Cash Deposit” and, collectively, the “Cash Deposits”), in an amount equal to $5,485,000 per Vessel under the relevant MOA, which Cash Deposit may be drawn upon by the Seller if SFL Holdings defaults under such MOA;

 WHEREAS, each MOA with a Tsakos Subsidiary requires that SFL Holdings deliver as a deposit a letter of credit (each a “Tsakos
L/C” and, collectively, the “Tsakos L/Cs”) in an amount equal to $8,512,500 per Vessel under the relevant MOA, which Tsakos L/C may be drawn upon by the Seller if SFL Holdings defaults under such MOA; 
  

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 WHEREAS, in order to finance a portion of the purchase price of each Vessel, the Owners have entered into
a Credit Agreement, dated the date hereof (the “Credit Agreement’), with Fortis Capital Corp. and the other lenders named therein (each a “Lender” and, collectively, the “Lenders”), pursuant to which the Lenders have
agree to advance to each Owner the lesser of (i) 75% of the Recalculated Adjusted Average Purchase Price (as defined in the Credit Agreement) of the Vessel to be purchased by such Owner, or (ii) $42,000,000; 
 WHEREAS, the Credit Agreement includes a Letter of Credit Facility of up to $38,000,000, a portion of which will be used to issue the Tsakos L/Cs that
will be used to satisfy the deposit requirements of the MOA’s with the Tsakos Subsidiaries; 
 WHEREAS, the Owners have entered into
certain forward-starting interest rate swap agreements (the “Swaps”) in order to fix the interest rate payable by the Owners with respect to amounts advanced under the Credit Agreement; 
 WHEREAS, SFL has entered into an Interest Guarantee, dated the date hereof (the “Interest Guarantee”), pursuant to which SFL has guaranteed the
Owners’ liability under the Swaps with respect to the period prior to delivery of the Vessels that is unrelated to any Event of HLL Default under the Agreement to Acquire and Charter; 
 WHEREAS, SFL has entered into an L/C Guarantee, dated the date hereof (the “L/C Guarantee”), pursuant to which SFL has guaranteed the
Owners’ liability under the Tsakos L/Cs with respect to the period prior to delivery of the Vessels that is unrelated to any Event of HLL Default under the Agreement to Acquire and Charter; 
 WHEREAS, concurrently with SFL Holdings’ delivery of all of the Cash Deposits and Tsakos L/Cs to the Sellers, HLL is causing UBS AG, Stamford Branch
(“UBS”), to issue to Fortis Capital Corp., as Security Trustee for the Lenders and the Swap Providers (each as defined in the Credit Agreement), eight (8) letters of credit (each, a “Back-Up L/C” and collectively, the
“Back-Up L/Cs”) issued pursuant to HLL’s senior credit facility, in the aggregate amount of $29,337,500; three of such letters of credit shall each be in the amount of $8,512,500 and shall each support HLL’s obligation hereunder
to reimburse the relevant Owner in respect of such Owner’s liability under the Credit Agreement for amounts drawn under a Tsakos L/C issued under the Credit Agreement as a deposit under an MOA with a Tsakos Subsidiary; and five of such letters
of credit shall each be in the amount of $760,000 and shall support HLL’s obligation hereunder to reimburse the relevant Owner in respect of such Owner’s liability under the Swaps in respect of a particular Vessel; 
 WHEREAS, HLL, SFL and the Security Trustee have entered into a certain Interest and L/C Liability Agreement dated as of the date hereof (the
“Interest and L/C Liability Agreement”); 
 WHEREAS, as an integral part of the Transaction, including entering into the Charters,
HLL has agreed to reimburse SFL, SFL Holdings and the Owners, with respect to each Vessel, for certain amounts and in certain circumstances, as more fully set forth herein; 
  

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 THEREFORE, in consideration of the premises, and for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows: 
 1. Defined Terms. Capitalized terms used herein and
not otherwise defined shall have the meanings ascribed to them in the Charters. 
 2. Reimbursement Obligations. In consideration of
the agreement of SFL, SFL Holdings and the Owners to enter into the Transaction, HLL agrees as follows: 
 (a) Obligations Covered by
Back-Up L/Cs. HLL shall reimburse SFL, SFL Holdings and the relevant Owner (each an “SFL Party” and, collectively, the “SFL Parties”), without duplication, for the following: 
  

	 	(i)	any liabilities under the Credit Agreement in respect of amounts drawn under any Tsakos L/C (a “Tsakos L/C Draw”) as a result of a default under the MOA with respect to
such Tsakos L/C or paid by SFL under the L/C Guarantee with respect thereto (collectively, “L/C Liability”), plus interest thereon to the date of reimbursement by HLL at the interest rate required under the Credit Agreement (“Tsakos
L/C Draw Interest”); and 

  

	 	(ii)	any liabilities of the Owners in respect of the Swaps during the Pre-Delivery Period (as defined in the Credit Agreement), or paid by SFL under the Interest Guarantee with respect
thereto (collectively, a “Swap Breakage Liability”), in either case, following a default under the related MOA and the termination of the Swap related to such Vessel. 

 (b) Obligations Not Covered by Back-Up L/Cs. HLL shall reimburse the SFL Parties for the amount of any Cash Deposit forfeited to a Seller that is
an ER Subsidiary as a result of a default under the MOA with such Seller, together with interest accrued on such amount that is in excess of amounts due and unpaid by HLL pursuant to Section 1.4(e) of the Agreement to Acquire and Charter
(collectively, a “Cash Deposit Liability”). 
 (c) Limitations. Notwithstanding anything herein or in any Transaction
Document (as defined in the Credit Agreement) to the contrary the reimbursement obligations of HLL hereunder shall be subject to the following limitations: 
  

	 	(i)	HLL shall not be obligated to reimburse any SFL Party for any L/C Liability, , Tsakos L/C Draw Interest, Swap Breakage Liability, or Cash Deposit Liability in respect of or
resulting from any MOA default that was due to or resulted from an Event of SFL Default under the Agreement to Acquire and Charter; 

  

	 	(ii)	the total amount of HLL’s reimbursement obligations to the SFL Parties hereunder in respect of L/C Liability, Tsakos L/C Draw Interest and Swap Breakage Liability pursuant to
Section 2(a) hereof shall not exceed $40,000,000 in the aggregate; 

  

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	 	(iii)	HLL’s reimbursement obligation pursuant to Section 2(a)(i) hereof in connection with any L/C Liability shall be satisfied solely by a draw under the corresponding Back-Up
L/C, and no SFL Party, or any assignee of any SFL Party, shall have any recourse to HLL for any amounts due with respect to any L/C Liability that cannot be paid with the proceeds of a draw under the relevant Back-Up L/C; provided,
however, that each SFL Party and the Security Trustee, as assignee of any SFL Party, shall have recourse to HLL for any Tsakos L/C Draw Interest; 

  

	 	(iv)	HLL’s reimbursement obligation pursuant to Section 2(a)(ii) hereof in connection with any Swap Breakage Liability shall be satisfied first and to the maximum extent
possible by a draw under the corresponding Back-Up L/C; and 

  

	 	(v)	HLL’s obligation to reimburse the SFL Parties pursuant to Section 2(b) hereof in respect of a Cash Deposit Liability and Section 2(a)(ii) hereof in respect of a Swap
Breakage Liability to the extent exceeding the stated amount of the relevant Back-Up L/C, shall be unsecured obligations of HLL. 

 (d) In addition to the foregoing, HLL shall reimburse the SFL Parties for the amount of any L/C Liability or Swap Breakage Liability after the relevant MOA shall have been assigned by SFL Holdings to a third party either with HLL’s
prior written consent or after the occurrence and during the continuance of an Event of HLL Default (as defined in the Agreement to Acquire and Charter), without regard to the provisions of the Interest and L/C Liability Agreement (as defined in the
Credit Agreement). 
 3. Reimbursement Procedure. (a) If any SFL Party incurs any loss, cost or expense for which it is entitled
to reimbursement under Sections 2(a)(i) or (ii) hereof, HLL shall pay any such reimbursement amount due pursuant to and in accordance with the Interest and L/C Liability Agreement. 
 (b) In the event that any SFL Party incurs any loss, cost or expense for which it is entitled to reimbursement hereunder pursuant to Section 2(b),
it shall deliver to HLL a written request for reimbursement, including a reasonably detailed accounting of the amount for which reimbursement is sought with supporting documentation. HLL shall pay any such reimbursement amount due within three
(3) Business Days after receipt of such request for reimbursement. 
 4. Return of Back-Up L/Cs. SFL shall cause the Security
Trustee to return the Back-Up L/Cs to HLL as follows: (i) each Back-Up L/C relating to a Tsakos Vessel that has been delivered to and accepted by SFL Holdings under the relevant MOA shall be returned to HLL undrawn on the date of such delivery
and acceptance promptly upon the Seller’s return to the Security Trustee or the Agent of the Tsakos L/C related to such MOA, (ii) following a Deemed Dispute (as defined in the Interest and L/C Liability Agreement) with respect to any
Vessel, SFL shall cause the Security Trustee to either (a) return the related Back-Up L/C to UBS promptly after 50% of the amount thereof has been drawn by the Security Trustee in accordance with the Interest and L/C Liability Agreement, or
(b) upon instruction from HLL to do so, 

  

 4 

 
transfer such Back-Up L/C to SFL, in either case, to secure HLL’s potential reimbursement obligation to SFL in the event that such Deemed Dispute is
decided in favor of SFL under Section 6(c) hereof. SFL may hold such Replacement Back-Up L/C or transferred Back-Up L/C until the earlier of the date on which (x) the related Deemed Dispute has been settled by the parties pursuant to a
written agreement, or (y) a final award in respect of such Deemed Dispute has been issued pursuant to an arbitration proceeding, as contemplated by Section 6(b) below. SFL shall be entitled to draw an amount under such Replacement Back-Up
L/C to the extent it is entitled to payment pursuant to any such settlement or award and shall promptly thereafter return such Back-Up L/Cs to HLL. 
 5. Swap Collateral; Allocation of Settlement Amounts. (a) In the event that any Owner shall receive notice from any Swap Provider that the Exposure of the Exposed Parties to the Related Parties exceeds the Exposure Threshold
stated in the Master Agreements (as defined in the Credit Agreement), such Owner shall promptly notify HLL in writing of its receipt of such notice (each such notice to HLL, a “Swap Exposure Notice”). 
 (b) Upon its receipt of a Swap Exposure Notice, HLL shall have the right, but not the obligation, to take any single action or any combination of the
actions set forth in subparagraphs (i) and (ii) below such that, after giving effect thereto, the Exposure of the Exposed Parties to the Related Parties under the Master Agreements and the Related ISDAs does not exceed the Exposure
Threshold: 
  

	 	(i)	unilaterally increase the limitation set forth in Section 2(c)(ii) of this Agreement by sending written notice of such increase to SFL and the Agent under the Credit Agreement,
provided that in no event shall such amount exceed $50,000,000 without the prior written consent of the Security Trustee and the Owners; and/or 

  

	 	(ii)	deliver to the Security Trustee under the Credit Agreement, as additional collateral security for the pro rata benefit of the Swap Providers (as defined in the Credit
Agreement), cash and/or a standby letter of credit in favor of the Security Trustee (all such cash and standby letters of credit, collectively, the “Swap Collateral”). 

 (c) All Swap Collateral delivered by HLL to the Security Trustee shall be subject to security documents in form and substance satisfactory to HLL. In no
event shall any Swap Collateral be used as security for the SFL Parties’ Obligations (as defined in the Credit Agreement) under the Loan Documents (as defined in the Credit Agreement) other than such Obligations in respect of the aggregate
Exposure in excess of the Exposure Threshold. In the event that the circumstances giving rise to any Swap Exposure Notice shall cease to exist, HLL may at any time and from time to time thereafter, upon written notice to SFL and the Agent,
unilaterally decrease the limitation set forth in Section 2(c)(ii) of this Agreement, provided, that, in no event shall such amount be less than $40,000,000. Capitalized terms used in this Section, unless otherwise defined herein, shall have
the meanings set forth in the Schedules to the Master Agreements (as defined in the Credit Agreement). 
  

 5 

 (d) In the event that: (a) during the Pre-Delivery Period (as defined in the Credit Agreement), any
Designated Transaction shall have been terminated in whole or in part in accordance with the terms of the related Master Agreement (as defined in the Credit Agreement); (b) such termination shall not have resulted from an Event of SFL Default;
and (c) any SFL Party shall be entitled to receive a Settlement Amount under the related Master Agreement with respect to such termination, then such SFL Party shall cause such Settlement Amount to be paid to HLL instead. 
 6. Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York. 
 7. Jurisdiction; Dispute Resolution. (a) Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or Federal court of the United States of America sitting in New York County, and any appellate court thereof, in any action or proceeding arising out of or relating to this
Agreement (other than any action or proceeding relating to a Deemed Dispute (as defined in the Interest and L/C Liability Agreement)), and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such New York State or Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Subject to the foregoing and to paragraph (c) below, nothing in this Agreement shall affect any right that any party hereto may otherwise have to bring any action or proceeding
relating to this Agreement. Each of the parties hereto hereby irrevocably and unconditionally waives, to the fullest extent they may legally and effectively do so, any objection which they may now or hereafter have to the laying of venue of any
suit, action or proceeding arising out of or relating to this Agreement in any New York State or Federal court and the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court and any immunity from
jurisdiction of any court or from any legal process with respect to themselves or their property 
 (b) Notwithstanding anything in this
Agreement or any Transaction Document to the contrary, each of the parties hereto hereby irrevocably agrees that any Deemed Dispute (as defined in the Interest and L/C Liability Agreement) shall be settled by arbitration in New York County before a
panel of one mutually agreed upon arbitrator or, failing agreement, three persons consisting of one arbitrator to be appointed by SFL Parties, one arbitrator to be appointed by HLL, and one arbitrator by the two so appointed. The decision of any two
of the three on any point or points shall be final and binding, and may include costs, including reasonable attorney fees. Judgment may be entered upon any award made pursuant thereto in any court of competent jurisdiction. The arbitration
proceedings shall be conducted in accordance with the Rules of the Society of Maritime Arbitrators, Inc. current at the time when the arbitration proceedings are commenced. In cases where neither the claim nor any counterclaim exceeds the sum of
$250,000 (or such other sum as the parties may agree) the arbitration shall be conducted in accordance with the Shortened Arbitration Procedure of the Society of Maritime Arbitrators, Inc. current at the time when the arbitration proceedings are
commenced. Any claim by any party shall be waived unless arbitration is commenced by serving notice of demand within one (1) year of the occurrence of the event giving rise to the Deemed Dispute. 
  

 6 

 8. Notices. All notices and other communications under this Agreement shall be in writing and
shall be deemed given when (i) delivered by hand, (ii) transmitted by telecopier (assuming clear transmission), or (iii) delivered, if sent by Express Mail, Federal Express or other express delivery service, or registered or certified
mail, return receipt requested, to the addressee at the following addresses or telecopier numbers (or to such other addresses or telecopier number as a party may specify by notice given to the other party pursuant to this provision): 
 If to SFL: 
 Ship Finance International Ltd.

 PO Box HM 1393 
 Par-la-Ville
Place 
 14 Par-la-Ville Road 
 Hamilton HM 08 Bermuda 
 Attn.: Vice President, Finance 
 Fax No.: +1 441 295 69 35 
 with a copy to:

 Frontline Management AS 
 Bryggegata 3 
 P.O. Box 1327-VIKA 
 Oslo 0112 Norway 
 Attn.: Vice President, Finance 
 Fax No.: +4723114040 
 Seward &
Kissel LLP 
 One Battery Park Plaza 
 New York, New York 10004 
 Attn: Gary J. Wolfe, Esquire 
 Fax No.: 212-480-8421 
 If to SFL Holdings:

 SFL Holdings LLC 
 PO Box HM
1393 
 Par-la-Ville Place 
 14
Par-la-Ville Road 
 Hamilton HM 08 Bermuda 
 Attn.: Vice President, Finance 
 Fax No.: +1 441 295 69 35 
  

 7 

 with a copy to: 
 Frontline Management AS 
 Bryggegata 3 
 P.O. Box 1327-VIKA 
 Oslo 0112 Norway

 Attn.: Vice President 
 Fax
No.: +4723114040 
 Seward & Kissel LLP 
 One Battery Park Plaza 
 New York, New York 10004 
 Attn: Gary J. Wolfe, Esquire 
 Fax No.:
212-480-8421 
 If to any Owner: 
 To the address of such Owner indicated on Appendix 1 hereto. 
 With a copy to: 
 Frontline Management AS 
 Bryggegata 3

 P.O. Box 1327-VIKA 
 Oslo
0112 Norway 
 Attn.: Vice President 
 Fax No.: +4723114040 
 Seward & Kissel LLP 
 One Battery Park Plaza 
 New York, New York 10004 
 Attn: Gary J. Wolfe, Esquire 
 Fax No.:
212-480-8421 
 If to HLL: 
 Horizon Lines, LLC 
 4064 Colony Road 
 Suite 200 
 Charlotte, NC 28211 
 Attn.: M. Mark Urbania 
           Sr. Vice President & CFO 
 Fax No.: 704-973-7034 

 

 8 

 With a copy to: 
 Blank Rome LLP 
 600 New Hampshire Avenue, N.W. 
 Suite 1200 
 Washington, D.C. 20037

 Attn.: T. Michael Dyer, Esquire 
 Fax No.: (202) 772-5858 
 9. Amendments. This Agreement may not be amended, modified or revised, in whole or in part,
except by written instrument signed by all parties hereto. 
 10. Assignment. Neither party hereto may assign any of the rights or
obligations created by this Agreement except with the express written consent of the other parties hereto. 
 11. Severability. Each
term and provision of this Agreement shall be valid and enforceable to the fullest extent permitted by applicable law. Should any term or provision of this Agreement be held invalid, illegal or unenforceable, the remainder of this Agreement,
including the application of such term to the extent not invalid, illegal or unenforceable, shall not be affected thereby, and this Agreement shall be interpreted as if such term or provision, to the extent invalid, illegal or unenforceable, did not
exist. 
 12. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original,
but all of which shall constitute one and the same instrument. 
 13. Termination. HLL’s obligation hereunder to make
reimbursement payments with respect to any L/C, Cash Deposit or breakage costs relating to a Vessel shall terminate immediately upon delivery of such Vessel to SFL Holdings. All of HLL’s obligations hereunder shall terminate immediately upon
delivery of the last Vessel to SFL Holdings. 
 14. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT. 
 [SIGNATURES ON FOLLOWING PAGE] 
  

 9 

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

			
	HORIZON LINES, LLC
		
	By:	 	 /s/ M. Mark Urbania

		 	M. Mark Urbania
		 	Sr. Vice President & CFO
	
	SHIP FINANCE INTERNATIONAL LIMITED
		
	By:	 	 /s/ Inger M. Klemp

		 	Inger M. Klemp
		 	Attorney-In-Fact/Authorized Person
	
	SFL HOLDINGS, LLC
		
	By:	 	 /s/ Kenneth Becker

	Name:	 	Kenneth Becker
	Title:	 	Management Committee Member
	
	HL EAGLE LLC
		
	By:	 	 /s/ Kenneth Becker

	Name:	 	Kenneth Becker
	Title:	 	Management Committee Member

  

 S-1 

			
	HL FALCON LLC
		
	By:	 	 /s/  Kenneth Becker

	Name:	 	Kenneth Becker
	Title:	 	Management Committee Member
	
	HL HAWK LLC
		
	By:	 	 /s/  Kenneth Becker

	Name:	 	Kenneth Becker
	Title:	 	Management Committee Member
	
	HL HUNTER LLC
		
	By:	 	 /s/  Kenneth Becker

	Name:	 	Kenneth Becker
	Title:	 	Management Committee Member
	
	HL TIGER LLC
		
	By:	 	 /s/  Kenneth Becker

	Name:	 	Kenneth Becker
	Title:	 	Management Committee Member

  

 S-2 

 APPENDIX 1 
 NAMES AND ADDRESSES OF THE OWNERS 
  

							
	 Name and Address of Owner
	  	 Vessel Name
	    	 Hull No.
	  	 
	HL Tiger LLC	  	Horizon Tiger	    	0387	  	
	Corporation Trust Center	  		    		  	
	1209 Center Street	  		    		  	
	Wilmington, Delaware 19801-1134	  		    		  	
				
	HL Hunter LLC	  	Horizon Hunter	    	0388	  	
	Corporation Trust Center	  		    		  	
	1209 Center Street	  		    		  	
	Wilmington, Delaware 19801-1134	  		    		  	
				
	HL Hawk LLC	  	Horizon Hawk	    	0389	  	
	Corporation Trust Center	  		    		  	
	1209 Center Street	  		    		  	
	Wilmington, Delaware 19801-1134	  		    		  	
				
	HL Falcon LLC	  	Horizon Falcon	    	0409	  	
	Corporation Trust Center	  		    		  	
	1209 Center Street	  		    		  	
	Wilmington, Delaware 19801-1134	  		    		  	
				
	HL Eagle LLC	  	Horizon Eagle	    	0427	  	
	Corporation Trust Center	  		    		  	
	1209 Center Street	  		    		  	
	Wilmington, Delaware 19801-1134	  		    		  	

  

 A-1

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