Document:

d1007401_ex4-74.htm

    
      Exhibit
4.74

    

    
 

    F28.055

     

    DATED 3 APRIL
2009

    

    

    JAPAN
III SHIPPING COMPANY LIMITED

    (as
borrower)

     

    -and-

     

    LICHTENSTEIN
SHIPPING COMPANY LIMITED

    (as
collateral guarantor)

     

    -and-

     

    ALPHA
BANK A.E.

    (as
lender)

    

    

    

    ___________________________________________________________

    

    SUPPLEMENTAL
AGREEMENT TO SECURED

    LOAN
FACILITY AGREEMENT DATED 17 DECEMBER 2007

    ___________________________________________________________

    

    

    

    

    STEPHENSON
HARWOOD

    One,
St. Paul's Churchyard

    London
EC4M 8SH

    Tel:
+44 (0)20 7329 4422

    Fax:
+44 (0)20 7329 7100

    Ref:
F28.055

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    CONTENTS

    Page

    
      	
              1

            	
              Interpretation

               

            	
              3

            
	
              2

            	
              Conditions

               

            	
              3

            
	
              3

            	
              Representations
      and Warranties

               

            	
              8

            
	
              4

            	
              Amendments
      to Loan Agreement

               

            	
              8

            
	
              5

            	
              Confirmation
      and Undertaking

               

            	
              12

            
	
              6

            	
              Communications,
      Law and Jurisdiction

               

            	
               13

            

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

    SUPPLEMENTAL
AGREEMENT 

     

    Dated:  3
April 2009

     

    BETWEEN:

     

    
      	
              (1)

            	
              JAPAN III SHIPPING COMPANY
      LIMITED, a company incorporated under the laws of the Republic of
      Liberia whose registered office is at 80, Broad Street, Monrovia, Liberia
      (the "Borrower");
      and

               

            

    

    
      	
              (2)

            	
              LICHTENSTEIN SHIPPING COMPANY
      LIMITED, a company incorporated under the laws of the Republic of
      Liberia whose registered office is at 80, Broad Street Monrovia, Liberia
      (the "Collateral
      Guarantor"); and

               

            

    

    
      	
              (3)

            	
              ALPHA BANK A.E., acting
      through its office at 89 Akti Miaouli, GR 185 38 Piraeus, Greece (the
      "Lender").

            

    

     

    SUPPLEMENTAL TO a secured loan
agreement dated 17 December 2007 (the "Loan Agreement") made between
the Borrower, as borrower and the Lender, as lender on the terms and subject to
the conditions of which the Lender has agreed to advance to the Borrower an
aggregate amount not exceeding forty eight million Dollars ($48,000,000) (the
"Loan").

     

    WHEREAS:

     

    
      	
              (A)

            	
              The
      Collateral Guarantor and the Lender have entered into a secured loan
      agreement dated 18 August 2008 as amended and supplemented by a first
      supplemental agreement dated 23 February 2009 and a supplemental agreement
      dated April 2009 (together the "Lichtenstein Loan Agreement")
      each made between, among others, the Collateral Guarantor, as
      borrower and the Lender, as lender on the terms and subject to the
      conditions of which the Lender has agreed to advance to the Collateral
      Guarantor an aggregate
      amount not exceeding thirty nine million Dollars ($39,000,000) (the "Lichtenstein
      Loan").  As security for the obligations of the
      Collateral Guarantor under the Lichtenstein Loan Agreement, the Collateral
      Guarantor executed, delivered and registered (where applicable), in favour
      of the Lender, as first mortgagee and assignee, a first preferred
      Panamanian mortgage over the Collateral Vessel together with a first
      priority assignment of the Collateral Vessel's Insurances, Earnings and
      Requisition Compensation and a first priority deed of assignment and
      subordination in respect of the bareboat charter of the Collateral
      Vessel.

            

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    
      	
               
      

            	
            

    

    
      	
              (B)

            	
              As
      security for the obligations of the Borrower under the Loan Agreement the
      Lender has requested and the Collateral Guarantor agreed to execute,
      deliver and register (where applicable), in favour of the Lender a
      guarantee and indemnity, a second preferred Panamanian mortgage over the
      Collateral Vessel, a second priority deed of assignment of the Insurances,
      Earnings and Requisition Compensation in respect of the Collateral Vessel
      and a second priority deed of assignment and subordination in respect of
      the bareboat charter of the Collateral Vessel.

               

            

    

    
      	
              (C)

            	
              The
      aggregate of the Market Value of the Vessel pursuant to clause 10.12 of
      the Loan Agreement is less than one hundred and thirty per cent (130%) of
      the Loan.

               

            

    

    
      	
              (D)

            	
              Pursuant
      to the provisions of clauses 10.12.1 to 10.12.3 of the Loan Agreement, the
      Borrower has an obligation to take certain action following the occurrence
      of the event set out in Recital (C) above.

               

            

    

    
      	
              (E)

            	
              The
      Borrower has requested that the Lender agrees to waive the provisions of
      clauses 10.12.1 to 10.12.3 and 12.2.2 of the Loan Agreement with effect
      from the Effective Date until and including 31 March 2010.

               

            

    

    
      	
              (F)

            	
              Pursuant
      to the provisions of clause 12.2.1 of the Loan Agreement, the Borrower
      would procure that the Guarantor shall at all times during the Facility
      Period on a consolidated basis commencing from the date of the Loan
      Agreement maintain a Minimum Liquidity of not less than twenty five
      million Dollars ($25,000,000).

               

            

    

    
      	
              (G)

            	
              The
      Borrower has requested that the Lender agrees to reduce the amount of the
      Minimum Liquidity referred to in clause 12.2.1 of the Loan Agreement to an
      amount not less than fifteen million Dollars (S15,000,000) with effect
      from the Effective Date up to and including 31 March 2010, whereupon and
      for the remaining of the Facility Period the amount of the Minimum
      Liquidity will be increased again to an amount of not less than twenty
      five million Dollars ($25,000,000).

               

            

    

    
      	
              (H)

            	
              The
      Lender is willing to agree to all the foregoing requests and amend the
      Loan Agreement and the Security Documents subject to the terms and
      conditions set forth in this Supplemental Agreement.

               

            

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    
      	
              (I)

            	
              At
      the date of this Supplemental Agreement the outstanding amount of the Loan
      is thirty four million seven hundred and fifty thousand Dollars
      (S34,750,000).

               

            

    

     

    IT
IS AGREED THAT:

     

    1.          Interpretation

     

    
      	
               
      

            	
              1.1

            	
              In
      this Supplemental Agreement:

            

    

     

    "Account Pledge" means a first
priority Greek account charge and pledge (enechyron) over the Cash Deposit
Account to be executed by the Borrower in favour of the Lender in form and
substance acceptable to the Lender in all respects.

    "Cash Deposit" means an amount
of four million Dollars (S4,000,000) to be credited by the Borrower in the Cash
Deposit Account and pledged in favour of the Lender.

     

    "Cash Deposit Account" means a
bank account opened or to be opened in the name of the Borrower with the Lender
and designated "Japan III Shipping Company Limited — Cash Deposit
Account".

     

    "Collateral Assignment" means a
second priority deed of assignment of the Insurances, Earnings and Requisition
Compensation in respect of the Collateral Vessel to be granted by the Collateral
Guarantor, as owner of the Collateral Vessel in favour of the Lender in form and
substance acceptable to the Lender in all respects.

     

    "Collateral Guarantee" means a
guarantee and indemnity to be executed by the Collateral Guarantor in favour of
the Lender in form and substance acceptable to the Lender in all
respects.

     

    "Collateral Managers'
Confirmation" means a managers' confirmation to be executed by each of
Top Tanker Management Inc., of the Republic of the Marshall Islands, and DL
Shipping Co., Ltd., of South Korea as managers of the Collateral Vessel in
favour of the Lender in form and substance acceptable to the Lender in all
respects.

     

    "Collateral Mortgage" means a
second preferred Panamanian mortgage over the Collateral Vessel to be granted by
the Collateral Guarantor, as owner of the Collateral Vessel in favour of the
Lender in form and substance acceptable to the Lender in all
respects.

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

     

    "Collateral Tripartite
Assignment" means a notarially attested and legalised (in respect of the
Lichtenstein Bareboat Charterer) second priority deed of assignment and
subordination in respect of the Collateral Vessel to be executed by the
Collateral Guarantor, as owner of the Collateral Vessel, the Lender, as lender
and the Lichtenstein Bareboat Charterer, as bareboat charterer in form and
substance acceptable to the Lender in all respects.

     

    "Collateral Vessel" means the
motor vessel "LICHTENSTEIN" registered in the ownership of the Owner under the
flag of the Republic of Panama with Provisional Patente de Navigacion number
3845-PEXT, together with all her engines, machinery, boats, tackle, outfit,
fuels, spares, consumable and other stores, belongings and appurtenances,
whether on board or ashore, including any which may in the future be put on
board or may in the future be intended to be used for the Collateral Vessel if
on shore.

     

    "Deed of Confirmation" means a
deed of confirmation to be executed by Top Ships Inc., of the Republic of the
Marshall Islands in favour of the Lender in form and substance acceptable to the
Lender in all respects.

     

    "Effective Date" means the date
of this Supplemental Agreement.

     

    "Existing Time Charter" means
the time charter in respect of the Vessel dated 13 March 2008 made between the
Borrower, as owner of the Vessel and the Existing Time Charterer, as charterer
on the terms and subject to the conditions of which
the Borrower would time charter the Vessel to the Existing Time Charterer for a
duration of 35 up to 37 months at a minimum net daily rate of hire of fifty four
thousand two hundred and fifty Dollars ($54,250).

     

    "Existing Time Charterer" means
Hanjin Shipping Co., Ltd., of South Korea.

     

    "Lichtenstein Bareboat
Charterer" means Daelim Corporation, of IOF KCCI Bldg, 45 4ga
Namdaemunre, Jung gu Seoul, Republic of South Korea.

     

    "New Security Documents" means
this Supplemental Agreement, the Collateral Guarantee, the Collateral Mortgage,
the Collateral Assignment, the Collateral Manager's Confirmation, the Deed of
Confirmation, the Account Pledge, the Collateral Tripartite Agreement and any
other agreement or document which may at any time be executed by any person as
additional security for the payment of all or any part of the
Indebtedness.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    "Security Parties" means all
parties to this Supplemental Agreement other than the Lender.

     

    
      	
               
      

            	
              1.2

            	
              Unless
      otherwise defined, all words and expressions defined in the Loan Agreement
      shall have the same meaning when used in this Supplemental Agreement
      unless the context otherwise requires, and clause I.2 of the Loan
      Agreement shall apply to the interpretation of this Supplemental Agreement
      as if it was set out in full.

            

    

     

    2.          Conditions

     

    
      
        	
                 
      

              	
                2.1

              	
                As
      conditions for the agreement of the Lender to the requests specified in
      Recitals (E) and (G) above, the Borrower shall deliver or cause to be
      delivered to or to the order of the Lender the following documents and
      evidence:

              

      

       

    

    
      	
               
      

            	
              2.1.1

            	
              a
      certificate from a duly authorised officer of each of the Borrower and the
      Guarantor confirming that none of the documents delivered to the Lender
      pursuant to clause 3.1 of the Loan Agreement have been amended or modified
      in any way since the date of their delivery to the Lender, or copies,
      certified by a duly authorised officer of each of the Borrower and the
      Guarantor as true, complete, accurate and neither amended nor revoked, of
      any documents which have been amended or
  modified;

            

    

     

    
      	
               
      

            	
              2.1.2

            	
              copies
      of the constitutional documents of the Collateral Guarantor together with
      such other evidence as the Lender may reasonably require that the
      Collateral Guarantor is duly incorporated in its country of incorporation
      and remains in existence with power to enter into, and perform its
      obligations under, the New Security Documents to which it is or is to
      become a party;

            

    

     

    
      	
               
      

            	
              2.1.3

            	
              the
      original resolution of the directors and the shareholders of each of the
      Security Parties and the Guarantor (together, where appropriate, with
      signed waivers of notice of any directors' or shareholders' meetings)
      approving, and authorising or ratifying the execution of, the New Security
      Documents and any document to be executed by each of the Security Parties
      and the Guarantor pursuant to the New Security
  Documents;

            

    

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              2.1.4

            	
              a
      notarially attested and legalised power of attorney of each of the
      Security Parties and the Guarantor under which the New Security Documents
      and any documents required pursuant to them are to be executed by each of
      the Security Parties and the
Guarantor;

            

    

     

    
      	
               
      

            	
              2.1.5

            	
              a
      certificate of good standing in respect of each of the Security Parties
      and the Guarantor;

            

    

     

    
      	
               
      

            	
              2.1.6

            	
              the
      New Security Documents, together with all other documents required by any
      of them, including, without limitation, all other notices of assignment
      and/or charge duly executed, and registered (where applicable) and
      evidence that those notices will be duly acknowledged by the recipients
      and in the case of the Collateral Mortgage registered with second priority
      at the Ship's Registry (or equivalent office) of the Collateral Vessel's
      current flag;

            

    

     

    
      	
               
      

            	
              2.1.7

            	
              a
      certificate of ownership and encumbrance (or equivalent) issued by the
      Registrar of Ships (or equivalent official) of the Collateral Vessel's
      current flag confirming that the Collateral Vessel is permanently
      registered under the flag of the Republic of Panama in the ownership of
      the Collateral Guarantor and that the Collateral Mortgage in respect of
      the Collateral Vessel has been registered with second priority and that
      there are no further encumbrances registered apart from a first preferred
      Panamanian mortgage over the Collateral Vessel dated 23 February 2009
      executed by the Collateral Guarantor in favour of the
    Lender;

            

    

     

    
      	
               
      

            	
              2.1.8

            	
              evidence
      that the Collateral Vessel is insured in the manner required by the New
      Security Documents and that letters of undertaking will be issued in the
      manner required by the New Security Documents together with copies of the
      relevant policies or cover notes or entry certificates duly endorsed with
      the interest of the Lender as second mortgagee and assignee, together with
      (if required by the Lender) the written approval of the Insurances by an
      insurance adviser appointed by the
Lender;

            

    

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              2.1.9

            	
              if
      required by the Lender, the written confirmation of the Managers that,
      throughout the Facility Period unless otherwise agreed by the Lender, they
      will remain the commercial and technical managers of the Collateral Vessel
      and that they will not, without the prior written consent of the Lender
      sub-contract or delegate the commercial or technical management of the
      Collateral Vessel to any third party and confirming in terms acceptable to
      the Lender that, following the occurrence of an Event of Default, all
      claims against the Borrower shall be subordinated to the claims of the
      Lender under the Finance Documents;

            

    

     

    
      	
               
      

            	
              2.1.10

            	
              confirmation
      satisfactory to the Lender that all legal opinions required by the Lender
      will be given substantially in the form required by the
      Lender;

            

    

     

    
      	
               
      

            	
              2.1.11

            	
              evidence
      that any process agent referred to in clause 21.5 of the Loan Agreement
      and any process agent appointed under any New Security Document has
      accepted its appointment;

            

    

     

    
      	
               
      

            	
              2.1.12

            	
              such
      duly signed forms of mandate, and/or other evidence of the opening of the
      Cash Deposit Account, as the Lender may require in respect of the
      Borrower;

            

    

     

    
      	
               
      

            	
              2.1.13

            	
              evidence
      satisfactory to the Lender that the Cash Deposit has been credited to the
      Cash Deposit Account; and

            

    

     

    
      	
               
      

            	
              2.1.14

            	
              a
      copy of any other consent, licence, approval, authorisation or other
      document, opinion or assurance which the Lender considers to be necessary
      or desirable (if it has notified the Borrower and/or the Collateral
      Guarantor accordingly) in connection with the entry into and performance
      of the transactions contemplated by this Supplemental Agreement and the
      other New Security Documents or for the validity and enforceability of
      this Supplemental Agreement and the other New Security
      Documents.

            

    

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              2.2

            	
              If
      the Lender agrees, in its sole discretion, to waive any conditions under
      Clause 2.1 prior to the Effective Date, the Borrower undertakes to deliver
      all outstanding documents and evidence to or to the order of the Lender no
      later than the date specified by the Lender, which however, shall not be
      taken as a waiver of the Lender's right to require production of all the
      documents and evidence required by Clause
2.1.

            

    

     

    
      	
               
      

            	
              2.3

            	
              All
      documents and evidence delivered to the Lender pursuant to this Clause
      shall:

            

    

     

    
      	
               
      

            	
              2.3.1

            	
              be
      in form and substance acceptable to the
Lender;

            

    

     

    
      	
               
      

            	
              2.3.2

            	
              be
      accompanied, if required by the Lender, by translations into the English
      language, certified in a manner acceptable to the Lender;
    and

            

    

     

    
      	
               
      

            	
              2.3.3

            	
              if
      required by the Lender, be certified, notarised, legalised or attested in
      a manner acceptable to the Lender.

            

    

     

    3.          Representations
and Warranties

     

    Each of
the representations and warranties contained in clause
I 1 of the Loan Agreement shall
be deemed repeated by the Borrower at the Effective Date, by reference to the
facts and circumstances then pertaining, as if references to the Security
Documents included this Supplemental Agreement.

     

    4.          Amendments
to Loan Agreement

     

     
With effect from the Effective Date:

     

    
      	
               
      

            	
              4.1

            	
              the
      definitions contained in Clause 1.1 (other than the definition
      of "Effective
      Date") of this
      Supplemental Agreement shall be added to clause 1.1 of the Loan
      Agreement;

            

    

     

    
      	
               
      

            	
              4.2

            	
              the
      definition of "Collateral
      Guarantor" contained in Recital 2 was added in clause 1.1 of the Loan
      Agreement;

            

    

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              4.3

            	
              the
      definition of the term "Margin", as is set out
      in clause 1.1 of the Loan Agreement shall be substituted as
      follows:-

            

    

     

    
      	
               
      

            	
              "Margin" means two point
      five per cent (2.5%) per annum.";

            

    

     

    
      	
               
      

            	
              4.4

            	
              where
      the context so admits, all references to the term "Earnings Account" (however
      defined) in the Loan Agreement and the Security Documents, shall be read
      and construed as including the Cash Deposit
  Account;

            

    

     

    
      	
               
      

            	
              4.5

            	
              where
      the context so admits, all references to the term "Mortgage" (however defined) in the Loan
      Agreement and the Security Documents, shall be read and construed as
      including the plural of such term or as referring to each "Mortgage", as if they
      were references to the Mortgage in respect of the Vessel and to the
      Collateral Mortgage in respect of the Collateral
  Vessel;

            

    

     

    
      	
               
      

            	
              4.6

            	
              the
      definition of "Security Documents" set forth in
      clause 1.1 of the Loan Agreement was construed to include the New Security
      Documents;

            

    

     

    
      	
               
      

            	
              4.7

            	
              the
      definition of "Security Parties" set forth in
      clause 1.1 of the Loan Agreement was construed to include the Collateral
      Guarantor;

            

    

     

    
      	
               
      

            	
              4.8

            	
              where
      the context so admits, all references to the term "Vessel" (however
      defined) in the Loan Agreement, including but not limited to references in
      clauses 1.1, 10, 12 and 13 of the Loan Agreement, and the Security
      Documents, shall be read and construed as including the plural of such
      term or as referring to each "Vessel" respectively,
      as if they were references to the Vessel in relation to the Borrower and
      to the Collateral Vessel in relation to the Collateral
      Guarantor;

            

    

     

    
      	
               
      

            	
              4.9

            	
              clause
      6.2.3 of the Loan Agreement was deleted and replaced with the following
      clause 6.2.3:

            

    

     

    
      	
               
      

            	
              "6.2.3. 
      any prepayment under this Clause 6.2 shall satisfy the obligations under
      Clause 5.1 (Repayment of
      Loan) as follows:

            

    

     

    
      	
               
      

            	
              (a)

            	
              if
      prepayment is made by 31 March 2010, fifty per cent (50%) of such
      prepayment shall be applied in reducing pro rata any unpaid part of the
      first thirteen (1st-13th) Repayment Instalments and the other fifty per
      cent (50%) of such prepayment shall be applied in reducing pro rata the
      following nineteen (14th-32nd) Repayment
  Instalments;

            

    

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (b)

            	
              if
      prepayment is made following the repayment of the fourteenth (14th)
      Repayment Instalment, such prepayment shall be applied in reducing pro
      rata the outstanding Repayment Instalments including the Balloon
      Payment";

            

    

     

    
      	
               
      

            	
              4.10

            	
              clause
      6.3 of the Loan Agreement was deleted and replaced with the following
      clause 6.3:

            

    

     

    "6.3  Mandatory Prepayment on sale or Total
Loss If the Vessel is sold by the Borrower or becomes a Total Loss, the
Borrower shall, simultaneously with any such sale or within one hundred and
fifty (150) days after any such Total Loss, prepay the whole of the Loan. If the
Collateral Vessel is sold by the Collateral Guarantor or becomes a Total Loss,
the Borrower shall, simultaneously with any such sale or within one hundred and
fifty (150) days after any such Total Loss, within thirty (30) days of the
Lender's request, at the Borrower's option:

                      

    
      
        	 	6.3.1 	
                pay
      to the Lender or to its nominee a cash deposit to be secured in favour of
      the Lender as additional security for the payment of the Indebtedness;
      or 

                 

              
	
                 
      

              	
                6.3.2

              	
                give
      to the Lender other additional security in amount and form acceptable to
      the Lender in its discretion; or

                 

              

      

    

    
      	
               
      

            	
              6.3.3

            	
              prepay
      an amount of the Indebtedness,

               

            

    

    which, in
each case, will ensure that the aggregate of the market value of the Vessel (as
determined pursuant to Clause 10.12) and the value of any such additional
security is not less than the ratio of the market value of the Vessel and the
Collateral Vessel as was immediately prior to the sale or Total Loss of the
Collateral Vessel.";

     

    
      	
               
      

            	
              4.11

            	
              the
      following clause was added as clause 10.13 of the Loan
      Agreement:

            

    

     

    "10.13
Cash Deposit Account The
Borrower shall maintain the Cash Deposit Account with the Lender for the
duration of the Facility Period free of Encumbrances and rights of set off other
than those created by or under the Finance Documents.";

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              4.12

            	
              the
      following clause was added as clause 10.14 of the Loan
      Agreement;

            

    

     

    "10.14
Cash Deposit The
Borrower shall procure that the Cash Deposit is credited and remains credited
for the duration of the Facility Period to the Cash Deposit Account. The Cash
Deposit held in the Cash Deposit Account pledged in favour of the Lender will be
applied toward the prepayment of the Loan pursuant to Clause 6 in case the
Existing Time Charter is amended and/or supplemented and/or novated and/or
renegotiated and/or cancelled and/or repudiated and/or terminated, and it will
be released to the Borrower as follows:

    
      
        	 	(a) 	
                an
      amount of two million Dollars ($2,000,000) will be released to the
      Borrower or to its order on 31 December 2009; and

                 

              
	
                 
      

              	
                (b)

              	
                an
      amount of two million Dollars ($2,000,000) will be released to the
      Borrower or to its order on 31 March
2010,

              

      

    

     

    subject
to (i) no Event of Default having occurred, and (ii) the Existing Time Charter
has not in any respect been amended and/or supplemented and/or novated and/or
renegotiated and/or cancelled and/or repudiated and/or terminated up to and
including that date.";

     

    
      	
               
      

            	
              4.13

            	
              the
      Lender agrees to waive the breach of the covenant contained in clause
      10.12 of the Loan Agreement only until 31 March
  2010;

            

    

     

    
      	
               
      

            	
              4.14

            	
              clause
      12.2 of the Loan Agreement was deleted and replaced with the following
      clause 12.2:-

            

    

     

    
      	
               
      

            	
              "12.2
      Financial
      covenants

            

    

     

    The
Borrower shall procure that the Guarantor shall at all times during the Facility
Period on a consolidated basis (assessed semi-annually and certified in
accordance with Clause 12.1.2 (a)) commencing from the date of this
Agreement:-

     

    
      	
               
      

            	
              12.2.1

            	
              maintain
      a Minimum Liquidity of not less than twenty five million Dollars
      ($25,000,000), but of not less than fifteen million Dollars ($15,000,000)
      from the Effective Date until 31 March 2010 whereupon and for the
      remaining of the Facility Period the amount of the Minimum Liquidity will
      be increased again to an amount of not less than twenty five million
      Dollars (525,000,000); and

               

            

    

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              12,2,2

            	
              maintain
      a Minimum Adjusted Net Worth of not less than two hundred and fifty
      million Dollars ($250,000,000) with the exception of the period between
      the Effective Date and 31 March 2010; and

               

            

    

    
      	
               
      

            	
              12.2.3

            	
              maintain
      Minimum Equity of not less than one hundred million Dollars
      ($100,000,000).";

               

            

    

    
      	
               
      

            	
              4.15

            	
              clause
      13.1.18 of the Loan Agreement was deleted and replaced with the following
      clause 13.1.18:-

            

    

     

    
      	
               
      

            	
              "13.1.18

            	
              Notice of termination
      The Guarantor or the Collateral Guarantor gives notice to the
      Lender to determine its obligations under the Guarantee or the Collateral
      Guarantee."; and

               

            

    

    
      	
               
      

            	
              4.16

            	
              clause
      10.1 of the Loan Agreement shall be read and construed as including the
      New Security Documents.

            

    

     

    For the
avoidance of doubt, the Lender hereby consents to and permits the creation of
additional Encumbrance over the Collateral Vessel by virtue of the New Security
Documents. All other terms and conditions of the Loan Agreement shall remain
unaltered and in full force and effect.

     

    5.        Confirmation
and Undertaking

     

    
      	
               
      

            	
              5.1

            	
              The
      Borrower confirms that all of its respective obligations under or pursuant
      to each of the Security Documents to which it is a party remain in full
      force and effect, despite the amendments to the Loan Agreement made in
      this Supplemental Agreement, as if all references in any of the Security
      Documents to the Loan Agreement (however described) were references to the
      Loan Agreement as amended and supplemented by this Supplemental
      Agreement.

            

    

     

    
      	
               
      

            	
              5.2

            	
              The
      definition of any term defined in any of the Security Documents shall, to
      the extent necessary, be modified to reflect the amendments to the Loan
      Agreement made in this Supplemental
Agreement.

            

    

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    6.          Notices,
Law and Jurisdiction

     

    The
provisions of clauses 17 and 21 of the Loan Agreement shall apply to this
Supplemental Agreement as if they were set out in full and as if references to
the Loan Agreement were references to this Supplemental Agreement and references
to the Borrower were references to the Security Parties.

     

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

     

     

    
      
        	
                SIGNED and DELIVERED as a DEED
      by

              	
                )

              	 
	
                JAPAN
      III SHIPPING COMPANY LIMITED

              	
                )

              	 
	
                acting
      by Andreas Louka

              	
                )

              	 /s/
      Andreas Louka
	
                its
      duly authorized  attorney-in-fact

              	
                )

              	 
	
                in
      the presence of: 

              	
                )

              	 

      

    

    

    
      
        	
                SIGNED and DELIVERED as a DEED
      by

              	
                )

              	 
	
                LICHTENSTEIN
      SHIPPING COMPANY LIMITED

              	
                )

              	 
	
                acting
      by Andreas Louka

              	
                )

              	 /s/
      Andreas Louka 
	
                its
      duly authorized  attorney-in-fact

              	
                )

              	 
	
                in
      the presence of:

              	
                )

              	 

      

    

    

    
      
        	
                SIGNED and DELIVERED as a DEED
      by

              	
                )

              	 
	
                ALPHA
      BANK A.E.

              	
                )

              	 
	
                acting
      by Constantinos Flokos

              	
                )

              	 /s/
      Constantinos Flokos
	
                and
      by Gregorios Kondilis

              	
                )

              	 /s/
      Gregorios Kondilis
	
                its
      duly authorized  attorneys-in-fact

              	
                )

              	 
	
                in
      the presence of:

              	
                )

              	 

      

    

     

    

    SK 23116 0005
1007401

    
      
         

      

      
        13d1007473_ex4-75.htm

    
      Exhibit
4.75

    

     

    
 

    
    

     

    
      
        
          
            	
                    Dated: 5th
      March,
2008

                  

          

        

      

    

     

    

    EMPORIKI BANK OF GREECE
S.A.

    -
and -

    JAPAN
I SHIPPING COMPANY LIMITED

     

    
      
        
          
            	 
      	
                     

                    LOAN
      AGREEMENT NO. 185/2008

                    for
      a secured floating interest rate

                    loan
      facility

                    of
      up to US$50,000,000

                     

                  	 
      

          

        

      

    

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    TABLE OF
CONTENTS

     

     

    

     

    
      
        	
                CLAUSE

              	
                HEADINGS

              	
                PAGE

              
	 	 	 
	
                1.

              	
                PURPOSE,
      DEFINITIONS AND INTERPRETATION

              	
                1

              
	
                2.

              	
                THE
      LOAN

              	
                11

              
	
                3.

              	
                INTEREST

              	
                14

              
	
                4.

              	
                REPAYMENT
      - PREPAYMENT

              	
                17

              
	
                5.

              	
                PAYMENTS,
      TAXES, LOAN ACCOUNT AND COMPUTATION

              	
                21

              
	
                6.

              	
                REPRESENTATIONS
      AND WARRANTIES

              	
                22

              
	
                7.

              	
                CONDITIONS
      PRECEDENT

              	
                28

              
	
                8.

              	
                COVENANTS

              	
                31

              
	
                9.

              	
                EVENTS
      OF DEFAULT

              	
                40

              
	
                10.

              	
                INDEMNITIES
      - EXPENSES - FEES

              	
                45

              
	
                11.

              	
                SECURITY,
      APPLICATION, AND SET-OFF

              	
                49

              
	
                12.

              	
                UNLAWFULNESS,
      INCREASED COSTS

              	
                53

              
	
                13.

              	
                ASSIGNMENT,
      PARTICIPATION, LENDING BRANCH

              	
                54

              
	
                14.

              	
                MISCELLANEOUS

              	
                55

              
	
                15.

              	
                NOTICES
      AND OTHER MATTERS

              	
                57

              
	
                16.

              	
                APPLICABLE
      LAW AND JURISDICTION

              	
                59

              

      

    

     

    SCHEDULES

     

    
      	
              1.

            	
              FORM
      OF DRAWDOWN NOTICE

            	
              54

            
	
              2.

            	
              INSURANCES

            	
              56

            
	
              3.

            	
              FORM
      OF COMPLIANCE CERTIFICATE

            	 
      

    

    

    

     

    

    

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      

       

      THIS
AGREEMENT is dated the 5th day of March, 2008 made BETWEEN:

       

      
        	
                (1)

              	
                EMPORIKI BANK OF GREECE S.A.,
      a Greek banking societe anonyme duly incorporated under the laws of
      Greece, having its registered office at 11, Sofokleous Street, Athens,
      Greece, acting for the purposes of this Agreement through its office at
      114 Kolokotroni Street, Piraeus, Greece and includes its successors in
      title, as lender (the "Bank");
    and

              

      

       

      
        	
                (2)

              	
                JAPAN I SHIPPING COMPANY
      LIMITED, a company incorporated in the Republic of Liberia and
      having its registered office at 80, Broad Street, Monrovia, Liberia and
      includes its successors in title, as borrower (hereinafter called the
      "Borrower");

              

      

       

      AND
IT IS HEREBY AGREED as follows:

       

      
        	
                1.

              	
                PURPOSE, DEFINITIONS
      AND INTERPRETATION

              

      

       

      
        	
                1.1

              	
                Amount and
      Purpose

              

      

       

      This
Agreement sets out the terms and conditions upon and subject to which the Bank
agrees to make available to the Borrower a term loan facility of up to the
lesser of (a) Dollars fifty million ($50,000,000) and (b) 68% of the Market
Value of the Vessel, to be used for the purpose of financing up to 68% of the
Market Value of the Vessel.

       

      
        	
                1.2

              	
                Definitions

              

      

       

      In
this Agreement, unless the context otherwise requires each term or expression
defined in the recital of the parties and in this Clause shall have the meaning
given to it in the recital of the parties, in this Clause:

       

      "Accounting Period" means each
consecutive period of twelve (12) months falling during the Security Period
(ending on the last day in December of each year) for which the annual financial
statements are required to be delivered pursuant to sub-clause
8.1(a);

       

      "Accounts Pledge Agreement"
means an agreement to be entered into between the Borrower and the Bank
for the creation of a pledge over the Earnings Account and the Retention Account
in favour of the Bank, in form and substance satisfactory to the Bank as the
same may from time to time be amended and/or supplemented;

       

      "Advance" means each borrowing
of a portion of the Commitment by the Borrower or (as the context may require)
the principal amount of such borrowing;

       

      "Agreed Rate" means a rate
agreed between the Bank and the Borrower on the basis of which (instead of LIBO)
the interest rate is determined pursuant to Clause 3.6;

       

      "Approved Manager" means for
the time being Top Tanker Management Inc., a company duly incorporated in the
Republic of the Marshall Islands and having an office established in Greece (at
1, Vassilis Sofias Avenue & Megalou Alexandrou street, Maroussi, 151 24,
Greece) pursuant to the Greek laws 378/68, 27/75 and 814/79 (as amended) or any
other person appointed by the Borrower, with the prior written consent of the
Bank (such consent not to be unreasonably withheld) as the manager of the Vessel
and includes its successors in title;

       

      "Availability Period"
means
the period starting on the date hereof and ending on the 31st March,
2008 or until such later date as the Bank may agree in writing or on such
earlier date (if any): (i) on which the whole Commitment has been advanced by
the Bank to the Borrower, or (ii) on which the Commitment is reduced to zero
pursuant to Clauses 3.6, 9.9, 12.1 or 12.2 or any other Clause of this
Agreement;

       

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

       

      "Balloon Instalment" means the
principal part of the Loan amounting to $12,900,000 (Dollars twelve million nine
hundred thousand) which becomes due for repayment by the Borrower to the Bank on
the Final Maturity Date pursuant to Clause 4.1;

       

      "Bank" means the Bank as
specified in the beginning of this Agreement and includes its successors in
title and transferees;

       

      "Banking Day" means any day on
which banks and foreign exchange markets in New York, London, Pireaus and Athens
and in each country or place in or at which an act is required to be done under
this Agreement in accordance with the usual practice of the Bank, are open for
the transaction of business of the nature contemplated in this
Agreement;

       

      "Borrowed Money" means
Indebtedness incurred in respect of (i) money borrowed or raised, (ii) any bond,
note, loan stock, debenture or similar instrument, (iii) acceptance of
documentary credit facilities, (iv) deferred payments for assets or services
acquired, (v) rental payments under leases (whether in respect of land,
machinery, equipment or otherwise) entered into primarily as a method of raising
finance or of financing the acquisition of the asset leased, (vi) guarantees,
bonds, stand-by letters of credit or other instruments issued in connection with
the performance of contracts and (vii) guarantees or other assurances against
financial loss in respect of Indebtedness of any person falling within any of
sub-paragraphs (i) to (vi) above;

       

      "Borrower" means the Borrower
as specified in the beginning of this Agreement;

       

      "Break Costs" means all costs,
losses, premiums or penalties incurred by the Bank in the circumstances
contemplated by Clause 10.1, or as a result of it receiving any prepayment of
all or any part of the Loan (whether pursuant to Clause 4 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 Loan, and any liabilities,
expenses or losses incurred by the Bank in terminating or reversing, or
otherwise in connection with, any interest rate and/or currency swap,
transaction or arrangement entered into by the Bank 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 or the Master
Agreement;

       

      "Charterparty" means a time or
bareboat charterparty or contract of affreightment, agreement or related
document in respect of the employment of the Vessel for a period for more than
12 months and at a daily rate and on conditions acceptable to the Bank to be
made between the Borrower, as owner and any charterer on terms and conditions
acceptable to the Bank (and shall include any addenda thereto);

       

      "Charterparty Assignment"
means the assignment of the Charterparty to be executed by the Borrower
in favour of the Bank and the acknowledgement of notice of the assignment in
respect of the Charterparty to be given by a charterer, both in form and
substance satisfactory to the Bank as the same may from time to time be amended
and/or supplemented;

       

      "Commitment" means the amount
which the Bank has agreed to lend to the Borrower under Clause 2.1 as reduced
pursuant to any relevant term of this Agreement;

       

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      "Commitment
Letter" means the Commitment Letter dated 2nd
October, 2007 addressed by the Bank to the Corporate Guarantor and
accepted by it on the 5th October, 2007 and shall include any amendments or
addenda thereto;

       

      "Confirmation" means a
Confirmation exchanged, or deemed exchanged, between the Bank and the Borrower
as contemplated by the Master Agreement;

       

      "Corporate Guarantee" means an
irrevocable and unconditional guarantee given or, as the context may require, to
be given by the Corporate Guarantor in form and substance satisfactory to the
Bank as a security for the Outstanding Indebtedness and any and all other
obligations of the Borrower under this Agreement;

       

      "Corporate Guarantor" means
Top Ships Inc., a company duly incorporated in the Republic of the Marshall
Islands and listed and trading in the Nasdaq Global Select Market and/or any
other person nominated by the Borrower and acceptable to the Bank which may give
a Corporate Guarantee;

       

      "Credit Support Document"
means any document described as such in the Master Agreement and, where
the context permits, any other document referred to in any Credit Support
Document which has the effect of creating an Encumbrance in favour of the
Bank;

       

      "Credit Support Provider"
means any person (other than the Borrower) described as such in the
Master Agreement;

       

      "Default" means any Event of
Default or any event which with the giving of notice or lapse of time or the
satisfaction of any other condition (or any combination thereof) would
constitute an Event of Default;

       

      "Default Rate" means that rate
of interest per annum which is determined in accordance with the provisions of
Clause 3.4;

       

      "DOC" means a document of
compliance issued to an Operator in accordance with rule 13 of the ISM
Code;

       

      "Dollars" and "$" mean the
lawful currency of the United States of America and in respect of all payments
to be made under any of the Security Documents means funds which are for same
day settlement in the New York Clearing House Interbank Payments System (or such
other U.S. dollar funds as may at the relevant time be customary for the
settlement of international banking transactions denominated in
Dollars);

       

      "Drawdown Date" means the day,
being a Banking Day, on which the Commitment is or, as the context may require,
shall be advanced to the Borrower;

       

      "Drawdown Notice" means a
notice substantially in the terms of Schedule 1;

       

      "Early Termination Date" has
the meaning given to that expression in section 14 of the Master
Agreement;

       

      "Earnings" in relation to the
Vessel, means all earnings of the Vessel, both present or future, including all
freight, hire and passage moneys, compensation payable to the Owner in the event
of requisition of the Vessel for hire, remuneration for salvage and towage
services, demurrage and detention moneys, contributions of any nature whatsoever
in respect of general average, damages for breach (or payments for variation or
termination) of any charterparty or other contract for the employment of the
Vessel and any other earnings whatsoever due or to become due to the Owner in
respect of the Vessel and all sums recoverable under the Insurances in respect
of loss of Earnings and includes, if and whenever the Vessel is employed on
terms whereby any and all such moneys as aforesaid are pooled or shared with any
other person, that proportion of the net receipts of the relevant pooling or
sharing agreement which is attributable to the Vessel;

       

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      "Earnings Account" means the
account to be opened and maintained with the Lending Branch or with any other
Branch of the Bank or with any other bank the Bank may designate to the Borrower
at the discretion of the Bank, to which (inter alia) all Earnings of the Vessel
are to be paid in accordance with the provisions of this Agreement;

       

      "Encumbrance" means any
mortgage, charge (whether fixed or floating), pledge, lien, hypothecation,
assignment, security interest, title retention, arrest, seizure, garnishee order
(whether nisi or absolute) or any other order or judgement having similar effect
or other encumbrance of any kind securing or any right conferring a priority of
payment in respect of any obligation of any person;

       

      "Environmental Affiliate"
means any agent or employee of the Borrower or any other Relevant Party
or any person having a contractual relationship with the Borrower or any other
Relevant Party in connection with any Relevant Ship or her operation or the
carriage of cargo thereon;

       

      "Environmental Approval" means
any consent, authorisation, licence or approval of any governmental or public
body or authorities or courts applicable to any Relevant Ship or her operation
or the carriage of cargo thereon and/or passengers therein and/or provisions of
goods and/or services on or from the Relevant Ship required under any
Environmental Law;

       

      "Environmental Claim" means
any and all enforcement, clean up, removal or other governmental or regulatory
actions or orders instituted or completed pursuant to any Environmental Law or
any Environmental Approval together with claims made by any third party relating
to damage, contribution, loss or injury, resulting from any actual or threatened
emission, spill, release or discharge of a Material of Environmental Concern
from any Relevant Ship;

       

      "Environmental Laws" means all
national, international and state laws, rules, regulations, treaties and
conventions applicable to any Relevant Ship pertaining to the pollution or
protection of human health or the environment including, without limitation, the
carriage or Materials of Environmental Concern and actual or threatened
emissions, spills, releases or discharges of Materials of Environmental Concern
and actual or threatened emissions, spills, releases or discharges of Materials
of Environmental Concern from any Relevant Ship;

       

      "Event of Default" means any
event or circumstance set out in Clause 9 or described as such in any other of
the Security Documents;

       

      "Expenses" means the aggregate
at any relevant time (to the extent that the same have not been received or
recovered by the Bank) of:

       

      
        	
                 
      

              	
                (a)

              	
                all
      losses, liabilities, costs, charges, expenses, damages and outgoings of
      whatever nature, (including, without limitation, Taxes, repair costs,
      registration fees and insurance premiums, crew wages, repatriation
      expenses and seamen's pension fund dues) suffered, incurred, charged to or
      paid or committed to be paid by the Bank in connection with the exercise
      of the powers referred to in or granted by any of the Security Documents
      or otherwise payable by the Borrower in accordance with the terms of any
      of the Security Documents;

              

      

       

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (b)

              	
                the
      expenses referred to in Clause 10.2 (a) and (b);
  and

              

      

       

      
        	
                 
      

              	
                (c)

              	
                interest
      on all such losses, liabilities, costs, charges, expenses, damages and
      outgoings from, in the case of Expenses referred to in sub-paragraph (b)
      above, the date on which such Expenses were demanded by the Bank from the
      Borrower and in all other cases, the date on which the same were suffered,
      incurred or paid by the Bank until the date of receipt or recovery thereof
      (whether before or after judgement) at the Default Rate (as conclusively
      certified by the Bank);

              

      

       

      "Final Maturity Date" means
the date falling seven (7) years after the Drawdown Date;

       

      "Flag State" means the
Republic of Liberia or such other state or territory proposed in writing by the
Borrower to the Bank and approved (at its sole discretion) by the Bank (such
approval not to be unreasonably withheld), as being the Flag State of the Vessel
for the purposes of the Security Documents;

       

      "General Assignment" means the
assignment of the Earnings, Insurances and Requisition compensation collateral
to the Mortgage executed or (as the context may require) to be executed by the
Borrower in favour of the Bank in form satisfactory to the Bank;

       

      "Governmental Withholdings"
means withholdings and any restrictions or conditions resulting in any
charge whatsoever imposed, either now or hereafter, by any sovereign state or by
any political sub-division or taxing authority of any sovereign
state;

       

      "Group" means together the
Borrower, any Security Party and their Related Companies and "member of the Group" shall be
construed accordingly;

       

      "Indebtedness" means any
obligation for the payment or repayment of money, whether as principal or as
surety, whether present or future, actual or contingent;

       

      "Insurances" includes all
policies and contracts of insurance (which expression includes all entries of
the Vessel in a protection and indemnity or war risks association) which are
from time to time taken out or entered into in respect of the Vessel and her
Earnings or otherwise howsoever in connection with the Vessel;

       

      "Interest Payment Date" means
in respect of the Loan or any part thereof in respect of which a separate
Interest Period is fixed the last day of the relevant Interest Period and in
case of any Interest Period longer than three (3) months the date(s) falling at
successive three (3) monthly intervals during such longer Interest Period and
the last day of such Interest Period;

       

      "Interest Period" means in
relation to the Loan or any part thereof, each period for the calculation of
interest in respect of the Loan or such part ascertained in accordance with
Clauses 3.2 and 3.3;

       

      "ISM Code" means in relation
to its application to the Borrower, the Vessel and her operation:

       

      
        	
                 
      

              	
                (a)

              	
                "The
      International Management Code for the Safe Operation of Ships and for
      Pollution Prevention", currently known or referred to as the "ISM Code",
      adopted by the Assembly of the International Maritime Organisation by
      Resolution A. 741(18) on 4th
      November, 1993 and incorporated on 19th
      May, 1994 into chapter IX of the International Convention for the Safety
      of Life at Sea 1974 (SOLAS 1974);
and

              

      

       

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (b)

              	
                all
      further resolutions, circulars, codes, guidelines, regulations and
      recommendations which are now or in the future issued by or on behalf of
      the International Maritime Organisation or any other entity with
      responsibility for implementing the ISM Code, including without
      limitation, the "Guidelines on implementation or administering of the
      International Safety Management (ISM) Code by Administrations" produced by
      the International Maritime Organisation pursuant to Resolution A. 788(19)
      adopted on 25th
      November, 1995;

              

      

       

      as
the same may be amended, supplemented or replaced from time to
time;

       

      "ISM Code Documentation"
includes:

       

      
        	
                 
      

              	
                (a)

              	
                the
      DOC and SMC issued by a classification society in all respects acceptable
      to the Bank in its absolute discretion pursuant to the ISM Code in
      relation to the Vessel within the period specified by the ISM
      Code;

              

      

       

       

      
        	
                 
      

              	
                (b)

              	
                all
      other documents and data which are relevant to the ISM SMS and its
      implementation and verification which the Bank may require by request;
      and

              

      

       

       

      
        	
                 
      

              	
                (c)

              	
                any
      other documents which are prepared or which are otherwise relevant to
      establish and maintain the Vessel's or the Borrower's compliance with the
      ISM Code which the Bank may require by
request;

              

      

       

      "ISM SMS" means the safety
management system which is required to be developed, implemented and maintained
under the ISM Code;

       

      "ISPS Code" means the
International Ship and Port Security Code of the International Maritime
Organization and includes any amendments or extensions thereto and any
regulation issued pursuant thereto;

       

      "ISSC" means an International
Ship Security Certificate issued in respect of the Vessel pursuant to the ISPS
Code;

       

      Branch
by notice to the Borrowers;

       

      "LIBOR" means in relation to a
particular period the rate for deposits in Dollars equivalent to or comparable
to the amount of the Loan (or the relevant part thereof) for a period equivalent
to such period at or about 11:00 a.m. (London time) on the second Banking Day
before the first day of such period as displayed on Telerate page 3750 (British
Bankers' Association Interest Settlement Rates) (or such other page as may
replace such page 3750 on such system or on any other system of the information
vendor for the time being designated by the British Bankers' Association to
calculate BBA Interest Settlement Rate (as defined in the British Bankers'
Recommended Terms and Conditions ("BBAIRS" terms) dated August, 1985)); and if
on such date no such rate is so displayed, Libor for a period equivalent to such
period shall be the rate per annum (rounded upward if necessary to five decimal
place) at which the Bank is able in accordance with its usual practices to
obtain deposits in Dollars for an amount approximately equivalent to or
comparable with the amount to which Libor is to be determined at 11:00 a.m.
(London time) on the second Banking Day prior to the beginning of such period in
the London Interbank Market for delivery on the first day of that period and for
the number of days comprised therein;

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

       

      "Loan" means the aggregate
principal amount borrowed by the Borrower in respect of the Commitment or (as
the context may require) the principal amount thereof owing to the Bank under
this Agreement at any relevant time;

       

      "Lending Branch" means the
office of the Bank appearing at the beginning of this Agreement or any other
office of the Bank designated by the Bank as the Lending Branch by notice to the
Borrower;

       

      "Major Casualty Amount" means
any casualty to the Vessel in respect whereof the claim or the aggregate of the
claims against all insurers, before adjustment for any relevant franchise or
deductible, exceeds five hundred thousand Dollars ($500,000) or the equivalent
in any other currency;

       

      "Management Agreement" means
the agreement made between the Borrower and the Approved Manager providing
(inter alia) for the Approved Manager to manage the Vessel;

       

      "Manager's Undertaking" means
a letter of undertaking and subordination to be executed by the Approved
Manager, as manager, whereby the Approved Manager shall subordinate any and all
claims it may have against the Borrower and/or the Vessel to the claims of the
Bank hereunder and under the Security Documents ;

       

      "Margin" means one point ten
percent (1.10%) per annum;

       

      "Market Value" means the
market value of the Vessel as determined in accordance with Clause
8.6(b);

       

      "Master Agreement" means the
Master Agreement (on the 1992 ISDA (Multicurrency - Crossborder) form as
modified (or any other form of master agreement relating to interest or currency
exchange transactions)) made or to be made between the Bank and the Borrower,
and includes the Schedule thereto and all transactions from time to time entered
into and Confirmations from time to time exchanged under the Master Agreement
and any amending, supplementing or replacement agreements made from time to
time;

       

      "Master Agreement Liabilities"
means, at any relevant time, all liabilities actual or contingent,
present or future, of the Borrower to the Bank under the Master
Agreement;

       

      "Material of Environmental Concern"
means and includes pollutants, contaminants, toxic substances, oil as
defined in the United States Oil Pollution Act of 1990 and all hazardous
substances as defined in the United States Comprehensive Environmental Response,
Compensation and Liability Act 1988;

       

      "MOA" means in relation to the
Vessel, the Memorandum of Agreement dated 7th August, 2007 entered into between
the Seller, as seller, and the Borrower, as buyer of the Vessel, in respect of
the sale by such seller and the purchase by the Borrower of the Vessel and any
and all addenda thereto;

       

      "Month" means a period
beginning in one calendar month and ending in the next calendar month on the day
numerically corresponding to the day of the calendar month on which it started
provided that (i) if there is no such numerically corresponding day, it shall
end on the last Banking Day in such next calendar month and (ii) if such
numerically corresponding day is not a Banking Day, the period shall end on the
next following Banking Day in the same calendar month but if there is no such
Banking Day it shall end on the preceding Banking Day and "months" and "monthly" shall be construed
accordingly;

       

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

       

      "Mortgage" means the first
preferred ship mortgage on the Vessel to be executed by the Borrower in favour
of the Bank in form and substance satisfactory to the Bank;

       

      "Mortgaged Vessel(s)" means
the Vessel and any vessel which is or remain mortgaged in favour of the Bank
pursuant to this Agreement at any relevant time hereunder;

       

      "Operator" means any person
who is from time to time during the Security Period concerned in the operation
of the Vessel and falls within the definition of "Company" set out in rule
1.1.2. of the ISM Code;

       

      "Outstanding Indebtedness"
means the aggregate of (a) the Loan and interest accrued and accruing
thereon, (b) the Expenses, (c) the Master Agreement Liabilities and all other
sums of any nature (together with all interest on any of those sums) which from
time to time may be payable by the Borrower to the Bank pursuant to the Security
Documents, whether actually or contingently (d) any damages payable as a result
of any breach by the Borrower of any of the Security Documents and (e) 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;

       

      "Owner" means the
Borrower;

       

      "Permitted Encumbrance" means
any Encumbrance in favour of the Bank created pursuant to the Security Documents
and Permitted Liens;

       

      "Permitted Lien" means any
lien on the Vessel for master's, officers' or crew's wages outstanding in the
ordinary course of trading, any lien for salvage and any ship repairer's or
outfitter's possessory lien for a sum not (except with the prior written consent
of the Bank) exceeding the Major Casualty Amount;

       

      "Pledgors" means persons
acceptable to the Bank who have executed or (as the context may require) shall
execute the Shares Pledge Agreement;

       

      "Registry" means the offices
of such registrar, commissioner or representative of the Flag State who is duly
authorised to register the Vessel, the Borrower's title to the Vessel and the
Mortgage over the Vessel under the laws and flag of the Flag State;

       

      "Related Company" means any
company which is under the ultimate control, direct or indirect, of any
individual who has ultimate control, whether alone or with others, of the
Borrower or other entity of which such company is a Subsidiary and any
Subsidiary of any such company or entity;

       

      "Relevant Jurisdiction" means
any jurisdiction in which or where any Security Party is incorporated, resident,
domiciled, has a permanent establishment, carries on, or has a place of business
or is otherwise effectively connected;

       

      "Relevant Party" means the
Borrower, the Borrower's Related Companies and any other Security Party and any
Security Party's Related Companies;

       

      "Relevant Ship" means the
Vessel and any other vessel from time to time (whether before or after the date
of this Agreement) owned, managed or crewed by, or chartered to, any Relevant
Party;

       

       

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

       

      "Repayment Date" means each of
the dates specified in Clause 4.1 on which the Repayment Instalments shall be
payable by the Borrower to the Bank;

       

      "Repayment Instalment" means
each instalment of the Loan which becomes due for repayment by the Borrower to
the Bank on a Repayment Date pursuant to Clause 4.1;

       

      "Requisition Compensation"
means all sums of money or other compensation from time to time payable
by reason of requisition of the Vessel otherwise than by requisition for
hire;

       

      "Retention Account" means an
account of the Borrower with the Lending Branch or any other branch of the Bank
or any other bank as the Bank may at its discretion require;

       

      "Security Documents" means
this Agreement, the Master Agreement, the documents listed in Clause 11.1 and
any and every other document as may have been or shall from time to time after
the date of this Agreement be executed to guarantee and/or to secure the whole
or any part of the Outstanding Indebtedness and/or any and all other obligations
of the Borrower to the Bank pursuant to this Agreement (whether or not any such
document also secures moneys from time to time owing pursuant to any other
document or agreement);

       

      "Security Party" means the
Borrower, the Corporate Guarantor and any other person (other than the Bank)
which is or may become a party to any of the Security Documents;

       

      "Security Period" means the
period commencing on the date hereof and terminating on the date upon which the
Loan together with all interest thereon and all other moneys payable to the Bank
under this Agreement and the other Security Documents has been repaid in full to
the Bank;

       

      "Security Requirement" means
the amount in Dollars (as certified by the Bank, whose certificate shall, in the
absence of manifest error, be conclusive and binding on the Borrower) which is
at any relevant time one hundred and twenty five per cent (125%) of the
aggregate of (i) the Loan and (ii) the Swap Exposure;

       

      "Security Value" means the
amount in Dollars (as certified by the Bank whose certificate shall, in the
absence of manifest error, be conclusive and binding on the Borrower) which, at
any relevant time is the aggregate of (a) the Market Value of the Mortgaged
Vessel(s) as most recently determined in accordance with Clause 8.6 and (b) the
market value of any additional security provided under Clause 8.6 (c) (if
any);

       

      "Seller" means Golden Steamship
Co. S.A., of Panama;

       

      "Shares Pledge Agreement"
means the pledge agreement to be executed by the Pledgors in favour of
the Bank whereby the Pledgors shall pledge all the issued share capital of the
Borrower, in form and substance satisfactory to the Bank as the same may from
time to time be amended and/or supplemented;

       

      "Swap Exposure" means, as at
any relevant date, the amount certified by the Bank to the Borrower to be the
aggregate net amount in Dollars which would be payable by the Borrower to the
Bank under (and calculated in accordance with) Section 6(e) (Payments on Early
Termination) of the Master Agreement if an Early Termination Date had occurred
on the relevant date in relation to all continuing Transactions entered into
between the Borrower and the Bank;

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

       

      "SMC" means a safety management
certificate issued in respect of the Vessel in accordance with rule 13 of the
ISM Code;

       

      "Subsidiary" of a person means
any company or entity directly or indirectly controlled by such person, and for
this purpose "control" means either ownership of more than fifty percent (50%)
of the voting share capital (or equivalent rights of ownership) of such company
or entity or the power to direct its policies and management, whether by
contract or otherwise;

       

      "Taxes" includes all present
and future taxes, levies, imposts, duties, fees or charges of whatever nature
together with interest thereon and penalties in respect thereof (except taxes
concerning the Bank and imposed on the net income of the Bank) and "Taxation" shall be construed
accordingly;

       

      "Total Loss" in relation to
the Vessel, means (a) actual, constructive, compromised or arranged total loss
of the Vessel; or (b) requisition for title or other compulsory acquisition of
the Vessel otherwise than by requisition for hire; or (c) hijacking, theft,
condemnation, capture, seizure, detention, arrest or confiscation of the Vessel
by any government or by any person acting or purporting to act on behalf of any
government, unless the Vessel is released and restored to the Borrower within
thirty (30) days after the occurrence thereof;

       

      "Transaction" means a
Transaction entered into between the Bank and the Borrower pursuant to the
Master Agreement for the express purpose of hedging all or part of the
Borrower's interest rate risk pursuant to this Agreement;

       

      "Vessel" means the Panamax m/v
"EPSON TRADER" presently registered under the Panama flag and under dual
registration under the Philippines flag purchased by the Borrower from the
Seller pursuant to the MOA which upon delivery to the Borrower shall be
registered in the ownership of the Borrower at the Registry under the laws and
flag of the Flag State under the name "PEPITO".

       

      1.3        Interpretation

       

      In
this Agreement:

       

      
        	
                 
      

              	
                (a)

              	
                clause
      headings and the table of contents are inserted for convenience of
      reference only and shall be ignored in the interpretation of this
      Agreement;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                subject
      to any specific provision of this Agreement or of any assignment and/or
      participation or syndication agreement of any nature whatsoever, reference
      to each of the parties hereto and to the other Security Documents shall be
      deemed to be reference to and/or to include, as appropriate, their
      respective successors and permitted
assigns;

              

      

       

      
        	
                 
      

              	
                (c)

              	
                reference
      to a person shall be construed as including reference to an individual,
      firm, company, corporation, unincorporated body of persons or any State or
      any agency thereof;

              

      

       

      
        	
                 
      

              	
                (d)

              	
                where
      the context so admits, words in the singular include the plural and vice
      versa;

              

      

       

      
        	
                 
      

              	
                (e)

              	
                the
      words "including" and "in particular" shall not be construed as limiting
      the generality of any foregoing
words;

              

      

       

      
        	
                 
      

              	
                (f)

              	
                references
      to (or to any specified provisions of) this Agreement and all documents
      referred to in this Agreement shall be construed as references to this
      Agreement, that provision or that document as are in force for the time
      being and as are amended and/or supplemented from time to
      time;

              

      

       

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (g)

              	
                reference
      to this Agreement includes all the terms of this Agreement and any
      Schedules, Annexes or Appendices to this Agreement, which form an integral
      part of same;

              

      

       

      
        	
                 
      

              	
                (h)

              	
                reference
      to Clauses, sub-Clauses and Schedules are to Clauses, sub-Clauses and
      Schedules in this Agreement;

              

      

       

      
        	
                 
      

              	
                (i)

              	
                reference
      to the opinion of the Bank or a determination or acceptance by the Bank or
      to documents, acts, or persons acceptable or satisfactory to the Bank or
      the like shall be construed as reference to opinion, determination,
      acceptance or satisfaction of the Bank at the sole discretion of the Bank
      and such opinion, determination, acceptance or satisfaction of the Bank
      shall be conclusive and binding on the
Borrower;

              

      

       

      
        	
                 
      

              	
                (j)

              	
                references
      to a "regulation"
      include any present or future regulation, rule, directive,
      requirement, request or guideline (whether or not having the force of law)
      of any agency, authority, central bank or government department or any
      self regulatory or other national or supra-national
    authority;

              

      

       

      
        	
                 
      

              	
                (k)

              	
                references
      to any person include such person's assignees and successors in
      title;

              

      

       

      
        	
                 
      

              	
                (1)

              	
                references
      to a "guarantee"
      include references to an indemnity or other assurance against
      financial loss including, without limitation, an obligation to purchase
      assets or services as a consequence of a default by any other person to
      pay any Indebtedness and "guaranteed" shall be
      construed accordingly; and

              

      

       

      
        	
                 
      

              	
                (m)

              	
                references
      to any enactment shall be deemed to include references to such enactment
      as re-enacted, amended or extended.

              

      

       

      
        	
                2.

              	
                THE
      LOAN

              

      

       

      
        	
                 
      

              	
                2.1

              	
                Commitment to
      Lend

              

      

       

      The
Bank, relying upon (inter alia) each of the representations and warranties set
forth in Clause 6 and in each of the other Security Documents, agrees to lend to
the Borrower in one (1) advance and upon and subject to the terms of this
Agreement, the amount specified in Clause 1.1 hereof.

       

      
        	
                2.2

              	
                Drawdown Notice and
      Commitment to Borrow

              

      

       

      Subject
to the terms and conditions of this Agreement, the Commitment shall be advanced
to the Borrower following receipt by the Bank from the Borrower of a Drawdown
Notice not later than 10 a.m. (London time) on the second Banking Day before the
date on which the drawdown is intended to be made. A Drawdown Notice shall be
effective on actual receipt thereof by the Bank and, once given, shall, subject
as provided in Clause 3.6, be irrevocable.

       

      
        	
                2.3

              	
                Number of Advances
      Agreed

              

      

       

      The
Commitment shall be advanced to the Borrower in one advance.

       

       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

       

      
        	
                2.4

              	
                Disbursement

              

      

       

      Upon
receipt of the Drawdown Notice complying with the terms of this Agreement the
Bank shall, subject to the provisions of Clause 7, on the date specified in the
Drawdown Notice, make the Commitment available to the Borrower.

       

      
        	
                2.5

              	
                Application of
      Proceeds

              

      

       

      Without
prejudice to the Borrower's obligations under Clause 8.9, the Bank shall have no
responsibility for the application of the proceeds of the Loan (or any part
thereof) by the Borrower.

       

      
        	
                2.6

              	
                Termination Date of
      the Commitment

              

      

       

      Any
part of the Commitment undrawn and uncancelled at the end of the Availability
Period shall thereupon be automatically cancelled and the Bank shall have no
further obligation to the Borrower in respect of such undrawn part.

       

      
        	
                2.7

              	
                Evidence

              

      

       

      It
is hereby expressly agreed and admitted by the Borrower that abstracts or
photocopies of the books of the Bank as well as statements of accounts or a
certificate signed by an authorised officer of the Bank shall be conclusive
binding and full evidence on the Borrower as to the existence and/or the amount
of the at any time Outstanding Indebtedness, of any amount due under this
Agreement, of the applicable interest rate or Default Rate or any other rate
provided for or referred to in this Agreement, the Interest Period, the value of
additional securities under Clause 8.6(c), the payment or non payment of any
amount and/or the occurrence of any other Event of Default. Nevertheless,
enforcement procedures or any other court or out-of-court procedure can be
commenced by the Bank on the basis of the above mentioned means of evidence
including written statements or certificates of the Bank.

       

      
        	
                2.8

              	
                Cancellation

              

      

       

      The
Borrower may, cancel any undrawn part of the Commitment under this Agreement
upon giving the Bank not less than five (5) Banking Days' notice in writing to
that effect, provided that no Drawdown Notice has been given to the Bank under
Clause 2.2 for the full amount of the Commitment or in respect of the portion
thereof in respect of which cancellation is required by the Borrower. Any such
notice of cancellation, once given, shall be irrevocable. Any amount cancelled
may not be drawn. Notwithstanding any such cancellation pursuant to this Clause
2.8 the Borrower shall continue to be liable for any and all amounts due to the
Bank under this Agreement including without limitation any amounts due to the
Bank under Clause 10.

       

      
        	
                2.9

              	
                Disbursement of the
      Loan to Seller's Bank

              

      

       

      
        	
                 
      

              	
                (a)

              	
                Notwithstanding
      the foregoing provisions of this Clause 2, in the event that the
      Commitment or any relevant part thereof (as the case may be) is required
      to be drawn down prior to the satisfaction of the requirements of Clause 7
      and remitted to the Seller's Bank in accordance with Clause 3 of the MOA
      (the "Seller's Bank"),
      the Bank may in its absolute discretion agree to remit such amount
      to the Seller's Bank prior to the satisfaction of the requirements of
      Clause 7 expressly subject to the following
  conditions:

              

      

       

       

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (i)

              	
                such
      amount is remitted to the Seller's Bank to be held by it in an account in
      the Bank's name (the "deposit account") and
      to the order of the Bank;

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                the
      principal amount (the "deposited amount") of
      such funds will only be released to the Seller upon the Seller's
      presentation to the Seller's Bank of a copy of the protocol of delivery
      and acceptance for the Vessel in the form agreed between the Seller and
      the Borrower and duly signed on behalf of the Seller and the Borrower and
      countersigned by the Bank's
representative;

              

      

       

      
        	
                 
      

              	
                (iii)

              	
                the
      deposited amount so released may be used only for payment to the account
      of the Seller with the Seller's Bank in satisfaction of the balance of the
      purchase price of the Vessel; and

              

      

       

      
        	
                 
      

              	
                (iv)

              	
                in
      the event that none of the said amount so remitted is released in
      accordance with the Bank's instructions or any part thereof given in
      compliance with the conditions of sub-clauses (i), (ii) and (iii) above is
      not so released, the said amount so remitted and any interest earned, the
      Bank may, after expiry of five (5) days from the expected Delivery Date,
      instruct the Seller's Bank to pay the amount of the Loan and any earned
      interest to another account of the Bank and the Borrower shall be obliged
      to indemnify the Bank in accordance with Clause 10.1. Thereafter and
      subject to the receipt by the Bank of the amount of the Loan and any
      interest earned and prompt indemnification of the Bank by the Borrower in
      accordance with Clause 10.1, as and when any further Drawdown Notice is
      given by the Borrower) the provisions of this Clause shall apply again
      (mutatis mutandis).

              

      

       

      
        	
                 
      

              	
                (b)

              	
                When
      either:

              

      

       

      
        	
                 
      

              	
                (i)

              	
                the
      Commitment or any relevant part thereof (as the case may be) is disbursed
      (whether on the expected Delivery Date or thereafter) in accordance with
      Clause 2.9(a)(i) and (ii) or

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                the
      Bank withdraws the deposited amount under Clause
  2.9(d),

              

      

       

      the
Borrower shall forthwith upon demand by the Bank pay to the Bank such amounts
that may be certified by the Bank as being the amount required to indemnify the
Bank in respect of the cost to the Bank of funding the deposited amount from the
date of payment thereof to the Seller's Bank to the date of disbursement of the
deposited amount to the Seller or the refund of the deposited amount to the Bank
less the amount (if any) of the earned interest received by the Bank from the
Seller's Bank. For this purpose, the cost of the Bank funding the deposited
amount shall be deemed to be interest at a rate equal to the aggregate of (i)
the applicable Margin and (ii) LIBOR for comparable deposits on a call (day to
day) basis.

       

      
        	
                 
      

              	
                (c)

              	
                The
      Bank shall have no liability to the Borrower if the Seller's Bank fails to
      carry out any instructions given to it by the Bank to disburse or refund
      the deposited amount.

              

      

       

      
        	
                 
      

              	
                (d)

              	
                If,
      upon being instructed to do so by the Bank, the Seller's Bank fails either
      to apply the deposited amount in full in accordance with Clause 2.9
      (a)(ii) or to refund the deposited amount in full in accordance with
      Clause 2.9(a)(iv):

              

      

       

       

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (i)

              	
                the
      Bank shall cease to be obliged to make the Commitment or relevant part
      thereof (as the case may be) available unless and until the Seller's Bank
      carries out such instructions;

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                the
      continued failure of the Seller's Bank to do so for five Banking Days
      after the giving of such instruction shall be deemed to be an Event of
      Default for the purposes of this
Agreement;

              

      

       

      
        	
                 
      

              	
                (iii)

              	
                the
      Borrower shall indemnify the Bank on demand in respect to all loses
      certified by the Bank as suffered or incurred by the Bank as a consequence
      of the Seller's Bank failure to carry the Bank's instructions;
      and

              

      

       

      
        	
                 
      

              	
                (iv)

              	
                without
      prejudice to the obligations of the Borrower so to indemnify the Bank on
      demand, the Bank shall in good faith take reasonable and proper steps
      diligently to seek recovery of the deposited amount from the Seller's Bank
      (provided that prior to taking such action the Borrower shall have agreed
      to indemnify the Bank for all costs and expenses which may be incurred in
      seeking recovery of such amount, including, without limitation, all legal
      fees and disbursements reasonably and properly incurred) and if the Bank
      shall recover any part of the deposited amount (and provided that it has
      previously recovered full indemnification under Clause 2.9(d)(ii)) the
      Bank shall, so long as no Event of Default has occurred and is continuing,
      pay to the Borrower the amount so recovered after subtracting any tax
      suffered or incurred thereon by the
Bank.

              

      

       

      
        	
                 
      

              	
                (e)

              	
                If,
      at the time prior to the deposit of funds by the Bank with the Seller's
      Bank, the Bank considers in its absolute discretion that the Seller's Bank
      may be or will be unable or unwilling for any reason (including, without
      limitation, by reason of the Seller's Bank's financial position or
      regulatory requirements applicable to the Seller's Bank) to take and fully
      apply such deposit in accordance with the requirements of this Clause 2.9,
      the Bank may in its absolute discretion decide not to make such deposit
      and this Agreement shall thereupon take effect as if this Clause 2.9 does
      not apply and the Commitment or relevant part thereof (as the case may be)
      shall, without prejudice to Clause 7, be made and disbursed in the manner
      set out in this Agreement.

              

      

       

      
        	
                2.9

              	
                No security or lien
      from other person

              

      

       

      The
Borrower has not taken or received, and the Borrower undertakes that until all
moneys, obligations and liabilities due, owing or incurred by the Borrower under
this Agreement and the Security Documents have been paid in full, it will not
take or receive, any security or lien from any other person liable or for any
liability whatsoever.

       

      
        	
                3.

              	
                INTEREST

              

      

       

      3.1        Normal Interest
Rate

       

      The
Borrower shall pay interest on the Loan (or as the case may be, each portion
thereof to which a different Interest Period relates) in respect of each
Interest Period related thereto on each Interest Payment Date and in case of any
Interest Period longer than three (3) months interest shall be payable quarterly
in arrears and on the last day of such Interest Period. The interest rate for
the calculation of interest shall be the rate per annum determined by the Bank
to be the aggregate of (i) the Margin and (ii) LIBOR.

       

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

       

      3.2        Selection of Interest
Period

       

      The
Borrower may by notice received by the Bank not later than 10 a.m. (London time)
on the second Banking Day before the beginning of each Interest Period specify
(subject to Clause 3.3 below) whether such Interest Period shall have a duration
of three (3) or six (6) or up to twenty four (24) months (or such other period
as may be requested by the Borrower subject to Bank's approval and market
availability).

       

      3.3        Duration of Interest
Period

       

      Every
Interest Period shall, subject to market availability to be conclusively
determined by the Bank, be of the duration specified by the Borrower pursuant to
Clause 3.2 but so that:

       

      
        	
                 
      

              	
                (a)

              	
                the
      initial Interest Period in respect of the Loan will commence on the
      Drawdown Date and each subsequent Interest Period will commence forthwith
      upon the expiry of the previous Interest
Period;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                if
      any Interest Period would otherwise overrun one or more Repayment Dates,
      then, in the case of the last Repayment Date, such Interest Period shall
      end on such Repayment Date, and in the case of any other Repayment Date or
      Dates the Loan shall be divided into parts so that there is one part equal
      to the amount of the Repayment Instalment due on each Repayment Date
      falling during that Interest Period and having an Interest Period ending
      on the relevant Repayment Date and another part equal to the amount of the
      balance of the Loan having an Interest Period determined in accordance
      with Clause 3.2 and the other provisions of this Clause 3.3 and the
      expression "Interest
      Period in respect of the Loan" when used in this Agreement refers
      to the Interest Period in respect of the balance of the
    Loan;

              

      

       

      
        	
                 
      

              	
                (c)

              	
                if
      the Borrower fails to specify the duration of an Interest Period in
      accordance with the provisions of Clause 3.2 and this Clause 3.3, such
      Interest Period shall have a duration of three (3) months unless another
      period shall be agreed between the Bank and the Borrower provided always
      that such period shall comply with this Clause 3.3;
  and

              

      

       

      
        	
                 
      

              	
                (d)

              	
                if
      the Bank determines that funds for the duration of an Interest Period
      specified by the Borrower in accordance with Clause 3.2 are not readily
      available, then that Interest Period shall have such duration as the Bank,
      in consultation with the Borrower, may
  determine.

              

      

       

      3.4        Default
Interest

       

      If
the Borrower fails to pay any sum (including, without limitation, any sum
payable pursuant to this Clause 3.4) on its due date for payment under any of
the Security Documents, the Borrower shall pay interest on such sum from the due
date up to the date of actual payment (as well after as before judgement) at the
rate determined by the Bank pursuant to this Clause 3.4. The period beginning on
such due date and ending on such date of payment shall be divided into
successive periods of not more than six (6) months as selected by the Bank each
of which (other than the first, which shall commence on such due date) shall
commence on the last day of the preceding such period. The rate of interest
applicable to each such period shall be the aggregate (as determined by the
Bank) of (i) two and a half per cent (2.5%), per annum, (ii) the Margin and
(iii) the LIBOR. Such interest shall be due and payable on the last day of each
such period as determined by the Bank and 

       

       

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

       

      each
such day shall, for the purposes of this Agreement, be treated as an Interest
Payment Date. In case that a payment is made in default for any amount, the
Interest Periods will be determined by the Bank at its discretion including the
amounts for which there is no default, even if the Bank has not (yet) exercised
its rights pursuant to Clause 9.9(b) of this Agreement. If for the reasons
specified in Clause 3.6, the Bank is unable to determine a rate in accordance
with the foregoing provisions of this Clause 3.4, interest on any sum not paid
on its due date for payment shall be calculated at a rate determined by the Bank
to be two and a half per cent (2.5%) per annum above the aggregate of the Margin
and costs of funds to the Bank as conclusively determined by the Bank save for
manifest error. Interest payable by the Borrower as aforesaid shall be
compounded semi-annually (or if the period fixed by the Bank is longer, at the
end of such longer period) and shall be payable on demand.

       

      3.5        Notification of Interest and
Interest Rate

       

      The
Bank shall notify the Borrower promptly of the duration of each Interest Period
and of each rate of interest determined by it under this Clause 3 without
prejudice to the right of the Bank to make determinations at its sole
discretion. However, omission of the Bank to make such notification (without the
application of the Borrower) will not constitute and will not be interpreted as
if to constitute a breach of obligation of the Bank except in case of wilful
misconduct.

       

      3.6        Market disruption – Non
Availability

       

      
        	
                 
      

              	
                (a)

              	
                If
      and whenever, at any time prior to the commencement of any Interest
      Period, the Bank shall have determined (which determination shall, in the
      absence of manifest error, be conclusive): (i) that adequate and fair
      means do not exist for ascertaining LIBOR, during said Interest Period, or
      (ii) that deposits in Dollars are not available to the Bank in the London
      Interbank Market in the ordinary course of business in sufficient amounts
      for any Interest Period or (iii) that by reason of circumstances affecting
      the London Interbank Market generally, it is impracticable for the Bank to
      advance the Commitment or fund or continue to fund the Loan during any
      Interest Period or (iv) that LIBOR for that Interest Period will not
      adequately reflect the cost of funding of the Loan for that Interest
      Period, the Bank shall forthwith give notice (a "Determination Notice")
      thereof to the Borrower. A Determination Notice shall contain
      particulars of the relevant circumstances giving rise to its issue. After
      the giving of any Determination Notice the undrawn amount of the
      Commitment shall not be borrowed until notice to the contrary is given to
      the Borrower by the Bank.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                During
      the period of ten (10) days after any Determination Notice has been given
      by the Bank under sub-Clause 3.6(a) the Bank and the Borrower shall
      negotiate in good faith (but without incurring any legal obligations) with
      a view to arriving at an acceptable alternative basis (the "Substitute Basis"), for
      maintaining the Loan, failing which the Borrower shall promptly, on first
      demand or within the time limit which may be determined by the Bank,
      prepay the Loan together with accrued interest thereon to the date of
      prepayment (calculated at the rate or rates most lately applicable to the
      Loan) and all other sums payable by the Borrower under the Security
      Documents and the Commitment shall be reduced to zero. In such case the
      Borrower shall also reimburse to the Bank such amount as may be determined
      by the Bank to be necessary to compensate it for the increased cost (if
      any) of maintaining the Loan during the period of negotiation referred to
      in this Clause 3.6 until such prepayment. In case the Bank agrees
      

              

      

       

       

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

       

      
      

       

      
        	 	 	
                to a
      Substitute Basis for funding the Loan the Bank shall certify such
      Substitute Basis to the Borrower. The Substitute Basis may (without
      limitation) include alternative interest period(s), alternative currencies
      or alternative rates of interest but shall include the Margin above the
      cost of funds to the Bank. Each Substitute Basis so certified shall be
      binding upon the Borrower and shall take effect in accordance with its
      terms from the date specified in the Determination Notice until such time
      as the Bank notifies the Borrower that none of the circumstances specified
      in sub-Clause 3.6(a) continues to exist whereupon the normal interest rate
      fixing provisions of this Agreement shall
    apply. 

              

      

       

       

      3.7        Swap
Transactions

       

      
        	
                 
      

              	
                (a)

              	
                If,
      at any time during the Security Period, the Borrower wishes to enter into
      swap Transactions so as to (inter alia) hedge all or any part of its
      exposure under this Agreement to interest rate fluctuations, it shall
      advise the Bank in writing.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                Any
      such swap transaction shall be concluded with the Bank under the Master
      Agreement provided however that no such swap transaction shall be
      concluded unless the Bank first agrees to it in writing at its sole and
      absolute discretion. If and when any such swap transaction has been
      concluded, it shall constitute a Transaction, and the Borrower shall sign
      a Confirmation with the Bank.

              

      

       

      4.           REPAYMENT -
PREPAYMENT

       

       

      4.1        Repayment

       

       

      The
Borrower shall and it is expressly undertaken by the Borrower to repay the Loan
by (a) fourteen (14) consecutive semi annual Repayment Instalments to be repaid
on each of the Repayment Dates so that the first be repaid on the date falling
six (6) months after the Drawdown Date and each of the subsequent ones
consecutively falling due for payment on each of the dates falling six (6)
months after the immediately preceding Repayment Date with the last of such
Repayment Instalments falling due for payment on the Final Maturity Date and
(ii) the Balloon Instalment payable together with the last Repayment Instalment
on the Final Maturity Date; subject to the provisions of this Agreement, the
Repayment Instalments shall be in the following amounts:

       

      
        	
                 
      

              	
                (i)

              	
                1st
      to 4th
      (both inclusive) of such Repayment Instalments shall be in the
      amount of $3,337,500 (US Dollars three million three hundred thirty seven
      thousand five hundred) each and;

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                5th
      to 14th
      (both inclusive) of such Repayment Instalments shall be in the amount of
      $2,375,000 (Dollars two million three hundred seventy five thousand)
      each;

              

      

       

      Provided further that
(a) in the event that the Commitment is not drawn down in full, the
amount of the Balloon Instalment shall be reduced by the amount of the part of
the Commitment not drawn and (b) on the Final Maturity Date the Borrower shall
also pay to the Bank any and all other monies then due and payable under this
Agreement and the other Security Documents, and (c) if any of the Repayment
Instalments shall become due on a day which is not a Banking Day, the due date
therefor shall be extended to the next succeeding Banking Day unless such
Banking Day falls in the next calendar month, in which event such due date shall
be the immediately preceding Banking Day.

       

      4.2        Voluntary
Prepayment

       

       

      The
Borrower shall have the right, upon giving the Bank not less than five (5)
Banking Days' notice in writing, to prepay part or all of the Loan in each case
together with all unpaid interest accrued thereon and all other sums of money
whatsoever due and owing from the Borrower to the Bank hereunder or pursuant to
the other Security Documents and all interest accrued thereon, provided
that:

       

       

      
        
          
          

        

        
          17

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (a)

              	
                the
      giving of such notice by the Borrower will irrevocably commit the Borrower
      to prepay such amount as stated in such
notice;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                such
      prepayment may take place only on the last day of an Interest Period in
      respect of the Loan provided however, that if the Borrower shall request
      consent to make such prepayment on another day and the Bank shall accede
      to such request (it being in the reasonable discretion of the Bank to
      decide whether or not to do so) the Borrower will pay in addition to the
      amount to be prepaid, any such sum as may be payable to the Bank pursuant
      to Clause 10.1;

              

      

       

      
        	
                 
      

              	
                (c)

              	
                each
      partial prepayment shall be equal to Dollars one million ($1,000,000) or a
      whole multiple thereof or the balance of the
  Loan;

              

      

       

      
        	
                 
      

              	
                (d)

              	
                any
      prepayment of less than the whole of the Loan will be applied towards pro
      rata satisfaction of the Balloon Instalment and the outstanding Repayment
      Instalments;

              

      

       

      
        	
                 
      

              	
                (e)

              	
                every
      notice of prepayment shall be effective only on actual receipt (including
      by fax) by the Bank, shall be irrevocable and shall oblige the Borrower to
      make such prepayment on the date
specified;

              

      

       

      
        	
                 
      

              	
                (f)

              	
                no
      amount prepaid may be re-borrowed;
and

              

      

       

      
        	
                 
      

              	
                (g)

              	
                the
      Borrower may not prepay the Loan or any part thereof save as expressly
      provided in this Agreement.

              

      

       

      4.3        Compulsory Prepayment in
case of Total Loss or sale of the Vessel

       

      
        	
                 
      

              	
                (a)

              	
                On
      the Vessel becoming a Total Loss or suffering damage or being involved in
      an incident which in the reasonable opinion of the Bank may result in the
      Vessel being subsequently determined to be a Total
  Loss:

              

      

       

      
        	
                 
      

              	
                (iii)

              	
                prior
      to the advancing of the Commitment, the obligation of the Bank to advance
      the Commitment shall immediately cease and the Commitment shall be reduced
      to zero; or

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                in
      case the Commitment has been already advanced, the Borrower shall prepay
      the Outstanding Indebtedness the latest on the date falling one hundred
      and eighty (180) days after that on which the incident which in the
      reasonable opinion of the Bank may result in the Vessel being subsequently
      determined to be a Total Loss occurred or, if earlier, on the date upon
      which the insurance proceeds in respect of such Total Loss are or
      Requisition Compensation is received by the Borrower (or the Bank pursuant
      to the Security Documents).

              

      

       

      For
the purpose of this Agreement:

       

      
        	
                 
      

              	
                (i)

              	
                an
      actual total loss of the Vessel shall be deemed to have occurred at the
      actual date and time the Vessel was lost but in the event of the date of
      the loss being unknown then the actual total loss shall be deemed to have
      occurred on the date on which the Vessel was last
  reported;

              

      

       

       

      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (ii)

              	
                a
      constructive total loss shall be deemed to have occurred at the date and
      time notice of abandonment of the Vessel is given to the insurers of the
      Vessel for the time being (provided a claim for total loss is admitted by
      such insurers) or, if such insurers do not admit such a claim, at the date
      and time at which a total loss is subsequently adjudged by a competent
      court of law to have occurred;

              

      

       

      
        	
                 
      

              	
                (iii)

              	
                a
      compromised or arranged total loss shall be deemed to have occurred on the
      date on which a binding agreement as to such compromised or arranged total
      loss has been entered into by the insurers of the
  Vessel;

              

      

       

      
        	
                 
      

              	
                (iv)

              	
                requisition
      for title or other compulsory acquisition of the Vessel shall be deemed to
      have occurred on the date upon which the relevant requisition for title or
      other compulsory acquisition occurs;
and

              

      

       

      
        	
                 
      

              	
                (v)

              	
                hijacking,
      theft, condemnation, capture, seizure, detention, arrest, or confiscation
      of the Vessel by any government or by any person acting or purporting to
      act on behalf of any government, which deprives the Borrower of the use of
      the Vessel for more than thirty (30) days shall be deemed to occur upon
      the expiry of the period of thirty (30) days after the date upon which the
      relevant hijacking, theft, condemnation, capture, seizure, detention,
      arrest or confiscation occurred.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                In
      case of sale or other disposal of the Vessel, immediately upon completion
      of such sale or other disposal, the Borrower shall prepay the
      Loan.

              

      

       

      
        	
                4.4

              	
                Amounts payable on
      prepayment

              

      

       

      Any
prepayment of all or part of the Loan under this Agreement shall be made
together with (a) accrued interest on the amount to be prepaid to the date of
such prepayment (calculated, in the case of a prepayment pursuant to Clause 3.6
(b) at a rate equal to the aggregate of the Margin and the cost to the Bank of
funding the Loan), (b) any additional amount payable under Clause 5 and (c) all
other sums payable by the Borrower to the Bank under this Agreement or any of
the other Security Documents including, without limitation, any amounts payable
under Clause 10 and (d) in relation to any prepayment made on a date other than
an Interest Payment Date in respect of the whole of the Loan, it shall, in
addition to the amount prepaid and accrued interest, pay to the Bank any amount
which the Bank may certify is necessary to compensate the Bank for any Break
Costs incurred by the Bank as a result of the making of the prepayment in
question

       

      4.5        Master Agreement, Repayments
and Prepayments

       

      
        	
                 
      

              	
                (a)

              	
                Pursuant
      to the Master Agreement, the Bank and the Borrower may during the Security
      Period enter, into one or more Transactions (pursuant to Clause 3.7), the
      terms and conditions of each of which shall be specified in a Confirmation
      sent by the Bank to the Borrower.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                Notwithstanding
      any provision of the Master Agreement to the contrary, in the case of a
      prepayment of all or part of the Loan (including, without limitation, upon
      a Total Loss or sale in accordance with clause 4.3), then subject to
      Clause 4.5(c) the Bank shall be entitled but not obliged (and, where
      relevant, may do so without the consent of the Borrower, where it would
      otherwise be required whether under the Master Agreement or otherwise) to
      amend, supplement, cancel, net out, terminate, liquidate, transfer or
      assign all or any part of the rights, benefits and
  

              

      

       

       

      
        
          
          

        

        
          19

          
            

          

        

        
          
          

        

      

       

      
         

        
          	
                   
      

                	
                   

                	
                  obligations
      created by any Transaction and/or the Master Agreement and/or to obtain or
      re establish any hedge or related trading position in any manner and with
      any person the Bank in its absolute discretion may determine and both the
      Bank's and the Borrower's continuing obligations under any Transaction
      and/or the Master Agreement shall, unless agreed otherwise by the Bank, be
      calculated so far as the Bank considers it practicable by reference to the
      amended repayment schedule for the Loan taking into account the fact that
      less than the full amount of the Loan remains
  outstanding.

                

        

         

      

      
        	
                 
      

              	
                (c)

              	
                If
      less than the full amount of the Loan remains outstanding following a
      prepayment under this Agreement and the Bank in its absolute discretion
      agrees, following a written request of the Borrower, that the Borrower may
      be permitted to maintain all or part of a Transaction in an amount not
      wholly matched with or linked to all or part of the Loan, the Borrower
      shall within ten (10) days of being notified by the Bank of such
      requirement, provide the Bank with, or procure the provision to the Bank
      of, such additional security as shall in the opinion of the Bank be
      adequate to secure the performance of such Transaction, which additional
      security shall take such form, be constituted by such documentation and be
      entered into between such parties, as the Bank in its absolute discretion
      may approve or require, and each document comprising such additional
      security shall constitute a Credit Support
  Document.

              

      

       

      
        	
                 
      

              	
                (d)

              	
                The
      Borrower shall on the first written demand of the Bank indemnify the Bank
      in respect of all losses, costs and expenses (including, but not limited
      to, legal costs and expenses) incurred or sustained by the Bank as a
      consequence of or in relation to the effecting of any matter or
      transactions referred to in this Clause
4.5.

              

      

       

      
        	
                 
      

              	
                (e)

              	
                Notwithstanding
      any provision of the Master Agreement to the contrary, if for any reason,
      a Transaction has been entered into but no Advance is drawn down under
      this Agreement then, subject to clause 4.5(f) the Bank shall be entitled
      but not obliged (and, where relevant, may do so without the consent of the
      Borrower where it would otherwise be required whether under the Master
      Agreement or otherwise) to amend, supplement, cancel, net out, terminate,
      liquidate, transfer or assign all or any part of the rights, benefits and
      obligations created by such Transaction and/or the Master Agreement and/or
      to obtain or re-establish any hedge or related trading position in any
      manner and with any person the Bank in its absolute discretion may
      determine.

              

      

       

      
        	
                 
      

              	
                (f)

              	
                If
      a Transaction has been entered into but no Advance is drawn down under
      this Agreement and the Bank in its absolute discretion agrees, following a
      written request of the Borrower, that the Borrower may be permitted to
      maintain all or part of a Transaction, the Borrower shall within ten (10)
      days of being notified by the Bank of such requirement, provide the Bank
      with, or procure the provision to the Bank of, such additional security as
      shall in the opinion of the Bank be adequate to secure the performance of
      such Transaction, which additional security shall take such form, be
      constituted by such documentation and be entered into between such
      parties, as the Bank in its absolute discretion may approve or require,
      and each document comprising such additional security shall constitute a
      Credit Support Document for the purposes of the Master Agreement and/or
      otherwise.

              

      

       

       

      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (g)

              	
                Without
      prejudice to or limitation of the obligations of the Borrower under clause
      4.5(c), in the event that the Bank exercises any of its rights under
      clauses 4.5 (b), 4.5(c), 4.5(e) or 4.5(f) and such exercise results in all
      or part of a Transaction being terminated such termination shall be
      treated under the Master Agreement in the same manner as if it were a
      Terminated Transaction (as defined in section 14 of the Master Agreement)
      effected by the Bank after an Event of Default (as so defined in that
      section 14) by the Borrower and, accordingly, the Bank shall be permitted
      to recover from the Borrower a payment for early termination calculated in
      accordance with the provisions of section 6(e)(i) of the Master
      Agreement.

              

      

       

      
        	
                 
      

              	
                (h)

              	
                No
      Transaction will be entered into without the specific consent of the
      Borrower.

              

      

       

      5.           PAYMENTS, TAXES, LOAN
ACCOUNT AND COMPUTATION

       

      5.1        Payments – No set-off or
Counterclaims

       

      
        	
                 
      

              	
                (a)

              	
                The
      Borrower acknowledges that in performing its obligations under this
      Agreement, the Bank will be incurring liabilities to third parties in
      relation to the funding of amounts to the Borrower, such liabilities
      matching the liabilities of the Borrower to the Bank and that it is
      reasonable for the Bank to be entitled to receive payments from the
      Borrower gross on the due date in order that the Bank is put in a position
      to perform its matching obligations to the relevant third parties.
      Accordingly, all payments to be made by the Borrower under this Agreement
      and/or any of the other Security Documents shall be made in full, without
      any set-off or counterclaim whatsoever and, subject as provided in Clause
      5.3, free and clear of any deductions or withholdings or Governmental
      Withholdings whatsoever, in Dollars on the due date to the account of the
      Bank at such bank and in such place as the Bank may from time to time
      specify for that purpose, reference: "JAPAN I SHIPPING COMPANY LIMITED -
      LOAN AGREEMENT", Provided however, that the Bank shall have the right to
      change the place of account for payment, upon eight (8) Banking Days'
      prior written notice to the
Borrower.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                If
      at any time it shall become unlawful or impracticable for the Borrower to
      make payment under this Agreement to the relevant account or bank referred
      to in Clause 5.1(a), the Borrower may request and the Bank may agree to
      alternative arrangements for the payment of the amounts due by the
      Borrower to the Bank under this Agreement or the other Security
      Documents.

              

      

       

      5.2        Payments on Banking
Days

       

      All
payments due shall be made on a Banking Day. If the due date for payment falls
on a day which is not a Banking Day, the payment or payments due shall be made
on the next following Banking Day unless such Banking Day falls in the next
calendar month in which case payment shall be made on the immediately preceding
Banking Day.

       

      5.3        Gross Up

       

       

      
        
          
          

        

        
          21

          
            

          

        

        
          
          

        

      

       

      If
at any time any law, regulation, regulatory requirement or requirement of any
governmental authority, monetary agency, central bank or the like compels the
Borrower to make payment subject to Governmental Withholdings, or any other
deduction or withholding, the Borrower shall pay to the Bank such additional
amounts as may be necessary to ensure that there will be received by the Bank a
net amount equal to the full amount which would have been received had payment
not been made subject to such Governmental Withholdings or other deduction or
withholding. The Borrower shall indemnify the Bank against any losses or costs
incurred by the Bank by reason of any failure of the Borrower to make any such
deduction or withholding or by reason of any increased payment not being made on
the due date for such payment. The Borrower shall, not later than thirty (30)
days after each deduction, withholding or payment of any Governmental
Withholdings, forward to the Bank official receipts and any other documentary
receipts and any other documentary evidence reasonably required by the Bank in
respect of the payment made or to be made of any deduction or withholding or
Governmental Withholding. The obligations of the Borrower under this provision
shall, subject to applicable law, remain in force notwithstanding the repayment
of the Loan and the payment of all interest due thereon pursuant to the
provisions of this Agreement.

       

      5.4        Certificates
Conclusive

       

      Any
certificate or determination of the Bank as to any rate of interest, rate of
exchange or any other amount pursuant to and for the purposes of any of the
Security Documents shall, in the absence of manifest error, be conclusive and
binding on the Borrower.

       

      5.5        Computation

       

      All
interest and other payments payable by reference to a rate per annum under this
Agreement shall accrue from day to day and be calculated on the basis of actual
days elapsed and a 360 day year.

       

      6.          REPRESENTATIONS AND
WARRANTIES

       

      
        	
                6.1

              	
                The
      Borrower hereby represents and warrants to the Bank
  that:

              

      

       

      Continuing representations
and warranties

       

      
        	
                 
      

              	
                (a)

              	
                Due
      Incorporation/Valid
Existence

              

      

       

      the
Borrower and each of the other corporate Security Parties is duly incorporated
and validly existing and in good standing under the laws of their respective
countries of incorporation as limited liability companies, and have power to own
their respective property and assets, to carry on their respective business as
the same are now being lawfully conducted and to purchase, own, finance and
operate vessels, or, as the case may be, manage vessels, as well as to undertake
the obligations which they have undertaken or shall undertake pursuant to the
Security Documents;

       

      
        	
                 
      

              	
                (b)

              	
                Due Corporate
      Authority

              

      

       

      each
of the Borrower and the other Security Parties has power to execute, deliver and
perform its obligations under the Security Documents to which it is a party and
to borrow the Commitment and each of the other Security Parties has power to
execute and deliver and perform its obligations under the Security Documents to
which it is or is to be a party; all necessary corporate, shareholder and other
action has been taken to authorise the execution, delivery and performance of
the same and no limitation on the powers of the Borrower to borrow will be
exceeded as a result of borrowing the Loan;

       

       

      
        
          
          

        

        
          22

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (c)

              	
                Litigation

              

      

       

      no
litigation, arbitration, tax claim or administrative proceeding involving a
potential liability of the Borrower or any other Security Party is current or
pending or (to its or its officers' knowledge) threatened against the Borrower
or any other Security Party, which, if adversely determined, would have a
materially adverse effect on the business assets or the financial condition of
any of them;

       

      
        	
                 
      

              	
                (d)

              	
                No conflict with other
      obligations

              

      

       

      the
execution and delivery of, the performance of its obligations under, and
compliance with the provisions of, the Security Documents by the relevant
Security Parties will not (i) contravene any existing applicable law, statute,
rule or regulation or any judgment, decree or permit to which the Borrower or
any other Security Party is subject, (ii) conflict with, or result in any breach
of any of the terms of, or constitute a default under, any agreement or other
instrument to which the Borrower or any other Security Party is a party or is
subject to or by which it or any of its property is bound, (iii) contravene or
conflict with any provision of the memorandum and articles of
association/articles of incorporation/by-laws/statutes or other constitutional
documents of the Borrower or any other Security Party or (iv) result in the
creation or imposition of or oblige the Borrower or any other Security Party to
create any Encumbrance (other than a Permitted Encumbrance) on any of the
undertakings, assets, rights or revenues of the Borrower or any other Security
Party;

       

      
        	
                 
      

              	
                (e)

              	
                Financial
      Condition

              

      

       

      the
financial condition of the Borrower and of the other Security Parties has not
suffered any material deterioration since that condition was last disclosed to
the Bank;

       

      
        	
                 
      

              	
                (f)

              	
                No
      Immunity

              

      

       

      neither
the Borrower nor any other Security Party nor any of their respective assets are
entitled to immunity on the grounds of sovereignty or otherwise from any legal
action or proceeding (which shall include, without limitation, suit, attachment
prior to judgement, execution or other enforcement);

       

      
        	
                 
      

              	
                (g)

              	
                Shipping
      Company

              

      

       

      each
of the Borrower and the Approved Manager is a shipping company involved in the
owning or, as the case may be, managing of ships engaged in international
voyages and earning profits in free foreign currency;

       

      
        	
                 
      

              	
                (h)

              	
                Licences/Authorisation

              

      

       

      every
consent, authorisation, license or approval of, or registration with or
declaration to, governmental or public bodies or authorities or courts required
by any Security Party to authorise, or required by any Security Party in
connection with, the execution, delivery, validity, enforceability or
admissibility in evidence of each of the Security 

       

       

      
        
          
          

        

        
          23

          
            

          

        

        
          
          

        

      

       

       

      Documents
or the performance by each Security Party of its obligations under the Security
Documents has been obtained or made and is in full force and effect and there
has been no default in the observance of any of the conditions or restrictions
(if any) imposed in, or in connection with, any of the same so far as the
Borrower is aware;

       

      
        	
                 
      

              	
                (i)

              	
                Perfected
      Securities

              

      

       

      when
duly executed, the Security Documents will create a perfected security interest
in favour of the Bank, with the intended priority, over the assets and revenues
intended to be covered, valid and enforceable against the Borrower and the other
Security Parties;

       

      
        	
                 
      

              	
                (j)

              	
                No
      Notarisation/Filing/Recording

              

      

       

      save
for the registration of any mortgage in the Registry, it is not necessary to
ensure the legality, validity, enforceability or admissibility in evidence of
this Agreement or any of the other Security Documents that it or they or any
other instrument be notarised, filed, recorded, registered or enrolled in any
court, public office or elsewhere or that any stamp, registration or similar tax
or charge be paid on or in relation to this Agreement or the other Security
Documents;

       

      
        	
                 
      

              	
                (k)

              	
                Validity and Binding
      effect

              

      

       

      the
Security Documents constitute (or upon their execution - and in the case of any
mortgage upon its registration at the Registry - will constitute) valid and
legally binding obligations of the relevant Security Parties enforceable against
the Borrower and the other Security Parties in accordance with their respective
terms and that there are no other agreements or arrangements which may adversely
affect or conflict with the Security Documents or the security thereby created;
and

       

      
        	
                 
      

              	
                (l)

              	
                Valid Choice of
      Law

              

      

       

      the
choice of law agreed to govern this Agreement and/or any other Security Document
and the submission to the jurisdiction of the courts agreed in each of the
Security Documents are or will be, on execution of the respective Security
Documents, valid and binding on the Borrower and any other Security Party which
is or is to be a party thereto.

       

      
        	
                 
      

              	
                (m)

              	
                Shareholdings

              

      

       

      the
Borrower's shares are legally and beneficially owned by the persons described to
the Bank in the negotiation of this Agreement; and

       

      
        	
                 
      

              	
                (n)

              	
                Money laundering -
      acting for own account

              

      

       

      The
Borrower confirms that, by entering into this Agreement and the other Security
Documents, it is acting on its own behalf and for their own account and it is
obtaining the Loan for their own account and the borrowing of the Commitment and
the performance and discharge of the Borrower's obligations and liabilities
under this Agreement and the other Security Documents to which each is or is to
be a party and other arrangements effected or 

       

      
        
          
          

        

        
          24

          
            

          

        

        
          
          

        

      

       

       

      contemplated
by this Agreement will not involve or lead to contravention of any law,
official, requirement or other regulatory measure or procedure mplemented to
combat "money laundering" as defined in Article 1 of the Directive (91/308/EEC)
of the Council of the European Community or any Relevant
Jurisdiction.

       

      
        	
                6.2

              	
                The
      Borrower hereby further represents and warrants to the Bank
      that:

              

      

       

      Initial representations and
warranties

       

      (a)       Direct obligations - Pari
Passu

       

       

      the
obligations of the Borrower under this Agreement are direct, general and
unconditional obligations of the Borrower and rank at least pari passu with all
other present and future unsecured and unsubordinated Indebtedness of the
Borrower with the exception of any obligations which are mandatorily preferred
by law;

       

      (b)       Information

       

      all
information, accounts, statements of financial position, exhibits and reports
furnished by or on behalf of any Security Party to the Bank in connection with
the negotiation and preparation of this Agreement and each of the other Security
Documents are true and accurate in all material respects and not misleading, do
not omit material facts and all reasonable enquiries have been made to verify
the facts and statements contained therein; to the knowledge of the
Directors/Officers of the Borrower, there are no other facts the omission of
which would make any fact or statement therein misleading and, in the case of
accounts and statements of financial position, they have been prepared in
accordance with generally accepted accounting principles which have been
consistently applied;

       

      (c)       No
Default

       

      no
Default has occurred and is continuing;

       

      (d)       No Taxes

       

      no
Taxes are imposed by deduction, withholding or otherwise on any payment to be
made by any Security Party under this Agreement and/or any other of the Security
Documents or are imposed on or by virtue of the execution or delivery of this
Agreement and/or any other of the Security Documents or any document or
instrument to be executed or delivered hereunder or thereunder. In case that any
Tax exists now or will be imposed in the future, it will be borne by the
Borrower;

       

      (e)       No Default under other
Indebtedness

       

      neither
the Borrower nor any other Security Party is in Default under any agreement
relating to Indebtedness to which it is a party or by which it may be
bound;

       

      (f)        Ownership/Flag/Seaworthiness/Class/Insurance
of the Vessel

       

      the
Vessel on the Drawdown Date will be:

       

       

      
        
          
          

        

        
          25

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (i)

              	
                in
      the absolute and free from Encumbrances (other than in favour of the Bank)
      ownership of the Borrower who will on and after the Drawdown Date be the
      sole legal and beneficial owner of the
Vessel;

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                registered
      in the name of the Borrower through the Registry under the laws and flag
      of the Flag State;

              

      

       

      
        	
                 
      

              	
                (iii)

              	
                operationally
      seaworthy and in every way fit for
service;

              

      

       

      
        	
                 
      

              	
                (iv)

              	
                classed
      with a classification society which is a member of IACS and which has been
      approved by the Bank in writing and such class will be free of all
      requirements and recommendations of such classification
      society;

              

      

       

      
        	
                 
      

              	
                (v)

              	
                insured
      in accordance with the provisions of this
  Agreement;

              

      

       

      
        	
                 
      

              	
                (vi)

              	
                managed
      by the Approved Manager; and

              

      

       

      
        	
                 
      

              	
                (vii)

              	
                in
      full compliance with the ISM Code and the ISPS
  Code;

              

      

       

      (g)       No
Charter

       

      unless
otherwise permitted in writing by the Bank the Vessel will not on or before the
Drawdown Date be subject to any charter or contract nor to any agreement to
enter into any charter or contract which, if entered into after the Drawdown
Date would have required the consent of the Bank under any of the Security
Documents and there will not on or before the Drawdown Date be any agreement or
arrangement whereby the Earnings of the Vessel may be shared with any other
person;

       

      (h)       MOA
Valid

       

      the
copy of the MOA to be delivered to the Bank shall be a true and complete copy of
such document constituting valid and binding obligations of the parties thereto
enforceable in accordance with its terms and no amendments thereto or variations
thereof shall have been (or will be) agreed nor shall any action been taken by
the parties thereto which would in any way render such document inoperative or
unenforceable;

       

      (i)        No
Rebates

       

      there
will be no commissions, rebates premiums or other payments by or to or on
account of the Borrower, any other Security Party or, to the knowledge of the
Borrower, any other person in connection with the MOA other than as shall be
disclosed to the Bank by the Borrowers in writing;

       

      (h)       No
Encumbrances

       

      neither
the Vessel, nor its Earnings, Requisition Compensation or Insurances nor any
other properties or rights which are, or are to be, the subject of any of the
Security Documents nor any part thereof will, on the Drawdown Date, be subject
to any Encumbrances other than Permitted Encumbrances;

       

      (i)         Compliance with
Environmental Laws and Approvals

       

      except
as may already have been disclosed by the Borrower in writing to, and
acknowledged in writing by, the Bank:

       

       

      
        
          
          

        

        
          26

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (i)

              	
                the
      Borrower and its Related Companies have complied with the provisions of
      all Environmental Laws;

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                the
      Borrower and its Related Companies have obtained all Environmental
      Approvals and are in compliance with all such Environmental Approvals;
      and

              

      

       

      
        	
                 
      

              	
                (iii)

              	
                neither
      the Borrower nor any of its Related Companies have received notice of any
      Environmental Claim that the Borrower or any of its Related Companies are
      not in compliance with any Environmental Law or any Environmental
      Approval;

              

      

       

      (j)        No Environmental
Claims

       

       

      
        	
                 
      

              	
                (i)

              	
                except
      as may already have been disclosed by the Borrower in writing to, and
      acknowledged in writing by, the
Bank:

              

      

       

      
        	
                 
      

              	
                (aa)

              	
                there
      is no Environmental Claim pending or, to the best of the Borrower's
      knowledge and belief, threatened against the Borrower or the Vessel or the
      Borrower's Related Companies or any other Relevant Ship;
    and

              

      

       

      
        	
                 
      

              	
                (bb)

              	
                there
      has been no emission, spill, release or discharge of a Material of
      Environmental Concern from the Vessel or any other Related Ship or any
      vessel owned by, managed or crewed by or chartered to the Borrower which
      could give rise to an Environmental
Claim;

              

      

       

      (k)       Copies true and
complete

       

      the
copies of the Bill of Sale, the MOA and the Management Agreement delivered or to
be delivered to the Bank pursuant to clause 7 are, or will when delivered be,
true and complete copies of such documents; such documents will when delivered
constitute valid and binding obligations of the parties thereto enforceable in
accordance with their respective terms and there will have been no amendments or
variations thereof or defaults thereunder;

       

      (1)       Application made for DOC and
SMC

       

      the
Operator has applied for a DOC for itself and an SMC in respect of the Vessel
and that neither the Borrower nor any Operator is aware of any reason why such
application may be refused;

       

      (m)      Compliance with ISPS
code

       

      the
Vessel and any Operator complies or will on the drawdown of the Commitment
comply with the requirements of the ISPS Code.

       

      (n)       Acting for its own
account

       

      the
Borrower by entering into this Agreement and the other Security Documents is
acting on its own behalf and for its own account.

       

      6.3        Representations
Correct

       

       

      
        
          
          

        

        
          27

          
            

          

        

        
          
          

        

      

       

      At
the time of entering into this Agreement all above representations and
warranties or any other information given by the Borrower and/or the Corporate
Guarantor to the Bank are true and accurate.

       

      6.4        Repetition of
Representations and Warranties

       

      The
representations and warranties in this Clause 6 (except in relation to the
representations and warranties in Clause 6.2) shall be deemed to be repeated by
the Borrower on the Drawdown Date and on each Interest Payment Date throughout
the Security Period.

       

      7.          CONDITIONS
PRECEDENT

       

      7.1        Conditions precedent to the
execution of this Agreement

       

      The
Borrower shall provide the Bank prior to the execution of this Agreement the
following documents and evidence in form and substance satisfactory to the
Bank:

       

      
        	
                 
      

              	
                (a)

              	
                a
      duly certified true copy of the Articles of Incorporation and By-Laws or
      the Memorandum and Articles of Association, or of any other constitutional
      documents, as the case may be, of each corporate Security
      Party;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                a
      recent certificate of incumbency of each corporate Security Party issued
      by the appropriate authority or, as appropriate, signed by the secretary
      or a director thereof, stating the officers and the directors of each of
      them and containing specimens of their respective
    signatures;

              

      

       

      
        	
                 
      

              	
                (c)

              	
                minutes
      of separate meetings of the directors and shareholders of each corporate
      Security Party at which there was approved (inter alia) the entry into,
      execution, delivery and performance of this Agreement, the other Security
      Documents and any other documents executed or to be executed pursuant
      hereto or thereto to which the relevant corporate Security Party is or is
      to be a party;

              

      

       

      
        	
                 
      

              	
                (d)

              	
                the
      original of any power(s) of attorney and any further evidence of the due
      authority of any person signing this Agreement, the other Security
      Documents, and any other documents executed or to be executed pursuant
      hereto or thereto on behalf of any corporate
  person;

              

      

       

      
        	
                 
      

              	
                (e)

              	
                evidence
      that all necessary licences, consents, permits and authorisations
      (including exchange control ones) have been obtained by any Security Party
      for the execution, delivery, validity, enforceability, admissibility in
      evidence and the due performance of the respective obligations under or
      pursuant to this Agreement and the other Security Documents;
      and

              

      

       

      
        	
                 
      

              	
                (f)

              	
                evidence
      that the drawdown fee and the commitment commission due under Clause 10.8
      has been paid in full; and

              

      

       

      
        	
                 
      

              	
                (g)

              	
                any
      other documents or recent certificates or other evidence which would be
      required by the Bank in relation to any corporate Security Party
      evidencing that the relevant Security Party has been properly established,
      continues to exist validly and to be in good standing;
  and

              

      

       

      
        	
                 
      

              	
                (h)

              	
                a
      declaration of beneficial shareholding by the ultimate shareholders(s) of
      the Borrower and a declaration showing that up to 5% of the shareholding
      of the Corporate Guarantor is held by Mr.Evangelos Pistiolis and members
      of his family.

              

      

       

       

      
        
          
          

        

        
          28

          
            

          

        

        
          
          

        

      

       

      7.2        Conditions concerning the
Vessel

       

      The
obligation of the Bank to advance the Commitment is subject to the further
condition that the Bank shall have received prior to the drawdown or, where this
is not possible, simultaneously with the drawdown of the
Commitment:

       

      
        	
                 
      

              	
                (a)

              	
                evidence
      that the Vessel will be duly registered in the ownership of the Borrower
      through the Registry at the port of the Vessel's port of registry under
      the laws and flag of the Flag State free from any Encumbrances save for
      those in favour of the Bank and otherwise as contemplated herein and free
      of any charter;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                evidence
      in form and substance satisfactory to the Bank that the Vessel has been or
      will - on drawdown - be insured in accordance with the insurance
      requirements provided for in Schedule 2 this Agreement and the other
      Security Documents (including (a) a Mortgagee's Interest Insurance for an
      amount equal to 120% of the amount of the Loan (herein "MII") and (b) (in case that the Bank
      reasonably determines or in case that the Vessel is scheduled to operate
      worldwide which could include USA jurisdiction or the USA Exclusive
      Economic Zone (as defined in the United States Oil Pollution Act 1990 or
      any other applicable legislation or in waters with similar to the United
      States Oil Pollution Act 1990 legislation), a Mortgagee's Interest
      Additional Perils (Pollution) insurance policy (herein "MAPI"), for an amount equal to 120% of
      the amount of the Loan, each of which the Bank may at any time effect on
      such terms and with such insurers as shall from time to time be determined
      by the Bank) to be followed by full copies of cover notes, policies,
      certificates of entry or other contracts of insurance and irrevocable
      authority is hereby given to the Bank at any time at its discretion to
      obtain copies of the policies, certificates of entry or other contracts of
      insurance from the insurers and/or obtain any information in relation to
      the Insurances relating to the
Vessel;

              

      

       

      
        	
                 
      

              	
                (c)

              	
                certified
      true copy of the Management Agreement evidencing that the Vessel is
      managed by the Approved Manager on terms acceptable to the
      Bank;

              

      

       

      
        	
                 
      

              	
                (d)

              	
                evidence
      that the trading certificates of the Vessel are valid and in
      force;

              

      

       

      
        	
                 
      

              	
                (e)

              	
                all
      necessary confirmations from the insurers of the Vessel that they will
      issue letters of undertaking and endorse notice of assignment and loss
      payable clauses on the Insurances, in form and substance satisfactory to
      the Bank in its sole discretion and ( - in the event of fleet cover -
      accompanied by waivers for liens for unpaid premium of other vessels
      managed by the Approved Manager and which are not subject to any mortgage
      in favour of the Bank);

              

      

       

      
        	
                 
      

              	
                (f)

              	
                each
      of the Security Documents (as set out in Clause 11.1) duly executed and
      where appropriate duly registered with the appropriate
      Registry;

              

      

       

      
        	
                 
      

              	
                (g)

              	
                evidence
      that the Vessel is classed as specified in Clause 6.2(f)(iv) with Lloyds
      Register of Shipping, or to a similar standard with another classification
      society of like standing to be specifically approved by the Bank, and
      remains free from any and all recommendations, overdue notations or
      average damage affecting class;

              

      

       

      
        	
                 
      

              	
                (h)

              	
                the
      Drawdown Notice in respect of the Commitment duly executed and
      issued;

              

      

       

       

      
        
          
          

        

        
          29

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (i)

              	
                copies
      of the DOC and SMC referred to in paragraph (a) in the definition of the
      ISM Code Documentation certified as true and in effect by the Borrower and
      the Approved Manager; and

              

      

       

      
        	
                 
      

              	
                (j)

              	
                copies
      of such ISM Code Documentation as the Bank may by written notice to the
      Borrower have requested not later than two (2) days before the Drawdown
      Date certified as true and complete in all material respects by the
      Borrower and the Approved Manager;

              

      

       

      
        	
                 
      

              	
                (k)

              	
                if
      the Bank so requires, a satisfactory to the Bank physical condition survey
      report on the Vessel together with a comprehensive record inspection from
      a surveyor appointed by the Bank, at the Borrower's expense;
      and

              

      

       

      
        	
                 
      

              	
                (1)

              	
                valuation
      of the Vessel, at the Borrower's expense, as at a date determined by the
      Bank but in any event before the relevant drawdown, prepared on the basis
      specified in Clause 8.6(b) by major shipbrokers appointed and/or approved
      by the Bank in form and substance satisfactory to the Bank in its sole
      discretion;

              

      

       

      7.3        Conditions concerning the
purchase of the Vessel

       

      The
obligation of the Bank to advance the Commitment any part thereof is subject to
the further condition that the Bank shall have received prior to or
simultaneously with the drawdown of the Commitment or the relevant part
thereof:

       

      
        	
                 
      

              	
                (b)

              	
                a
      copy of the MOA certified as true and complete by the legal counsel of the
      Borrower;

              

      

       

      
        	
                 
      

              	
                (c)

              	
                evidence
      to the full satisfaction of the Bank, proving the Seller's title to the
      Vessel free of any Encumbrances, debts or claims of any nature
      whatsoever;

              

      

       

      
        	
                 
      

              	
                (d)

              	
                duly
      certified copies of corporate documentation of the Seller - comparable at
      the discretion of the Bank to that provided in Clause 7.1 - proving the
      due incorporation and existence of the Seller and the due authorisation of
      the sale of the Vessel and the execution of all documents required in
      connection therewith;

              

      

       

      
        	
                 
      

              	
                (e)

              	
                duly
      certified copy of the Bill of Sale, the protocol of delivery and
      acceptance of the Vessel as well as of all other Seller's documents;
      and

              

      

       

      
        	
                 
      

              	
                (e)

              	
                evidence
      that the ten per cent (10%) deposit in respect of the Vessel and all other
      sums of money (other than the relevant Advance) required to be paid by the
      Borrower to the Seller pursuant to the MOA have been duly
      paid.

              

      

       

      7.4        No change of
circumstances

       

      The
obligation of the Bank to advance the Commitment or any part thereof is subject
to the further condition that at the time of the giving of the Drawdown Notice
and on the Drawdown Date:

       

      
        	
                 
      

              	
                (a)

              	
                the
      representations and warranties set out in Clause 6 and in each of the
      Security Documents are true and correct on and as of each such time as if
      each was made with respect to the facts and circumstances existing at such
      time;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                no
      Default shall have occurred and be continuing or would result from the
      drawdown; and

              

      

       

       

      
        
          
          

        

        
          30

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (c)

              	
                the
      Bank shall be satisfied that there has been no change in the ownership,
      management, operations and/or adverse change in the financial condition of
      any Security Party and the Group which (change) might, in the sole opinion
      of the Bank, be detrimental to the interests of the
  Bank.

              

      

       

      7.5        General
Conditions

       

      The
obligation of the Bank to advance the Commitment or any part thereof is subject
to the further condition that the Bank, prior to or simultaneously with the
drawdown, shall have received:

       

      
        	
                 
      

              	
                (a)

              	
                opinions
      from lawyers appointed by the Bank as to all the matters referred to in
      Clauses 6.1(a) and (b) and all such aspects of law as the Bank shall deem
      relevant to this Agreement and the other Security Documents and any other
      documents executed pursuant hereto or thereto and any further legal or
      other expert opinion as the Bank at its sole discretion may
      require;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                confirmation
      from any agents nominated in this Agreement and elsewhere in the other
      Security Documents for the acceptance of any notice or service of process,
      that they consent to such nomination;
and

              

      

       

      
        	
                 
      

              	
                (c)

              	
                a
      receipt in writing in form and substance satisfactory to the Bank
      including an acknowledgement and admission of the Borrower and/or any
      other Security Party to the effect that the Commitment or relevant part
      thereof (as the case may be) was drawn by the Borrower and a declaration
      by the Borrower that all conditions precedent have been fulfilled, that
      there is no Event of Default and that all the representations and
      warranties are true and correct.

              

      

       

      7.7        Waiver of conditions
precedent

       

      The
conditions specified in this Clause 7 are inserted solely for the benefit of the
Bank and may be waived by the Bank in whole or in part and with or without
conditions. Without prejudice to any of the other provisions of this Agreement,
in the event that the Bank, in its sole and absolute discretion, makes the
Commitment available to the Borrower prior to the satisfaction of all or any of
the conditions referred to in Clause 7.1 and 7.2, the Borrower hereby covenants
and undertakes to satisfy or procure the satisfaction of such condition or
conditions within such period as the Bank may, in its sole and absolute
discretion, agree or specify in writing.

       

      7.8        Further conditions
precedent

       

      The
Bank may request and the Borrower shall within such period from the date of such
request as shall be reasonably determined by the Bank, deliver to the Bank on
such request further favourable certificates and/or opinions as to any or all of
the matters which are the subject of Clauses 6, 7, 8 and 9.

       

      8.          COVENANTS

       

      The
Borrower hereby undertakes with the Bank that, from the date of this Agreement
and as long as any moneys are due and/or owing and/or outstanding under this
Agreement or any of the other Security Documents, the Borrower
will:

       

      8.1        Information
Covenants

       

      
        	
                 
      

              	
                (a)

              	
                Annual financial
      Statements

              

      

       

       

      
        
          
          

        

        
          31

          
            

          

        

        
          
          

        

      

       

      furnish
the Bank, in form and substance satisfactory to the Bank, with (a) combined
annual audited financial statements of the Group at latest within 180 days after
the end of the financial year concerned, this obligation to commence with the
financial year ending 31St
December, 2008, prepared in accordance with US Generally Accepted Accounting
Principles (herein "GAAP") which have been consistently applied and (b) company
prepared semi-annual consolidated financial statements of the Group signed by
the Chief Financial Officer of the Corporate Guarantor within 60 days from the
end of the respective financial semester and, this obligation to commence with
the financial year ending 315t
December, 2007;

       

      
        	
                 
      

              	
                (b)

              	
                Financial
      Information

              

      

       

      provide
the Bank annually and from time to time as the Bank may reasonably request and
in form and substance satisfactory to the Bank with information on the
consolidated financial condition, cash flow position, commitments and operations
of the Guarantor including cash flow analysis and voyage accounts of any vessels
owned by any such party with a breakdown of income and running expenses showing
net trading profit, trade payables and trade receivables, such financial details
to be certified by one of the directors of the relevant company as to their
correctness; and

       

      
        	
                 
      

              	
                (c)

              	
                Information on adverse
      change or Default

              

      

       

      promptly
inform the Bank of any occurrence which came to the knowledge of the Borrower
which might adversely affect the ability of the Borrower or any other Security
Party to perform its respective obligations under this Agreement and/or any of
the other Security Documents and of any Default forthwith upon becoming aware
thereof and will from time to time, if so requested by the Bank, confirm to the
Bank in writing that, save as otherwise stated in such confirmation, no Default
has occurred and is continuing;

       

      
        	
                 
      

              	
                (d)

              	
                Information on the
      employment of the Vessel

              

      

       

      provide
the Bank from time to time as the Bank may request with information on the
employment of the Vessel and any Relevant Ship as well as on the terms and
conditions of any charterparty, contract of affreightment, agreement or related
document in respect of the employment of the Vessel and any Relevant Ship, such
information to be certified by one of the directors of the Borrower as to their
correctness;

       

      8.2        Banking operations -
Liquidity

       

      
        	
                 
      

              	
                (a)

              	
                ensure
      that, all banking operations in connection with the Vessel are carried out
      through the Lending Branch;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                ensure
      that throughout the Security Period, the Borrower shall maintain in the
      Earnings Account average monthly balances of Dollars one million
      ($1,000,000);

              

      

       

      8.3        Additional Financial
Covenants

       

      The
Borrower shall ensure that, throughout the Security Period the financial
condition of the Corporate Guarantor on a consolidated basis and as evidenced by
the most recent financial statements produced in accordance with sub-clause
8.1(a), shall be such that:

       

       

      
        
          
          

        

        
          32

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (a)

              	
                ensure
      that, for the duration of the Security Period, the Leverage Ratio of the
      Corporate Guarantor will not at any time exceed
  75%;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                ensure
      that, for the duration of the Security Period, the ratio of EBITDA over
      Net Interest Expenses is not lower than
2.5:1.0;

              

      

       

      
        	
                 
      

              	
                (c)

              	
                ensure
      that, for the duration of the Security Period, the Corporate Liquidity of
      the Corporate Guarantor maintained with the Bank or financial institutions
      at any relevant time is of an amount not less than the aggregate of its
      next six (6) months overall senior debt servicing
    obligations;

              

      

       

      
        	
                 
      

              	
                (d)

              	
                ensure
      that a compliance certificate for each financial year of the Corporate
      Guarantor, signed by its chief financial officer, is delivered to the Bank
      by the Corporate Guarantor within 60 days after the end of the respective
      financial semester, substantially in the form set out in Schedule 3, duly
      completed and supported by calculations setting out in reasonable detail
      the materials underling the statements made in such compliance
      certificate;

              

      

       

      The
expressions used in this Clause 8.2 shall be construed in accordance with law
and accounting principles internationally accepted as used in the most recent
financial statements produced in accordance with sub-clause 8.1(a), and for the
purposes of this Agreement

       

      "Leverage Ratio" means, in
respect of each Accounting Period and on a consolidated basis of the Group,
Total Liabilities divided by the Total Assets (adjusted to fair market values of
the Vessels) during such period.

       

      "Corporate Liquidity" in
relation to the Corporate Guarantor means, in respect of an Accounting Period,
the aggregate amount of cash deposits held in accounts of the Corporate
Guarantor free from any encumbrances;

       

      "EBITDA" means, in respect of
an Accounting Period, the aggregate amount of consolidated pre-tax profits of
the Group before interest, taxes, depreciation and amortization and regular
drydock expenses;

       

      "Interest Expenses" means, in
respect of an Accounting Period, the aggregate of all interest incurred by any
member of the Group (excluding any amounts owing by one member of the Group to
another member of the Group) and any net amounts payable under interest rate
hedge agreements;

       

      "Total Assets" means, in
respect of an Accounting Period, total assets of the Group as stated in the most
recent financial statements produced in accordance with sub-clause 8.1(a);
and

       

      "Total Liabilities" means at
any relevant time the total liabilities of the Group as stated in the most
recent financial statements produced in accordance with sub-clause 8.1.
(a).

       

      8.4        No Further Financial
Exposure

       

      without
the prior written consent of the Bank such consent not to be unreasonably
withheld:

       

      (a)       No further
Indebtedness

       

       

      
        
          
          

        

        
          33

          
            

          

        

        
          
          

        

      

       

      incur
no further Indebtedness nor authorise or accept any capital commitments (other
than that normally associated with the day to day operations of the Vessel) nor
enter into any agreement for payment on deferred terms or hire
agreement;

       

      (b)       No Loans

       

      not
make any loans or advances to, or any investments or pay any interest thereon,
in any person, firm, corporation, joint venture or other entity including
(without limitation) any loan or advance to any officer, director, stockholder
or employee directly;

       

      (c)       No Disposal of
Assets/Dividends

       

      not
dispose of any assets and not declare or pay any dividends or other distribution
upon any of the issued shares or otherwise dispose of any assets to any of the
shareholders of the Borrower; and

       

      (d)       No
Payments

       

      except
pursuant to this Agreement and the other Security Documents (or as expressly
permitted by the same) not pay out any funds to any company or person except in
connection with the administration of the Borrower, the operation, maintenance
and/or repair of the Vessel;

       

      (e)       Control of the Corporate
Guarantor

       

      ensure
that the Corporate Guarantor will not appoint without the Bank's written consent
(such consent not to be unreasonably withheld) a CEO other than Mr. Evangelos
Pistiolis who together with members of his family shall be among the largest
shareholders thereof controlling no less than five per centum (5%) of the share
capital of the Corporate Guarantor;

       

      (f)        Maintenance of the Business
and Legal Structure of the Corporate Guarantor

       

      ensure
that the Corporate Guarantor shall continue to be a holding company of
ocean-going vessels, listed and trading in the Nasdaq Global Select Market or
the New York Stock Exchange;

       

      (g)       Know your customer and money
laundering compliance

       

      provide
the Bank with such documents and evidence as the Bank shall from time to time
require, based on law and regulations applicable from time to time and the
Bank's own internal guidelines applicable from time to time to identify the
Borrowers and the other Security Parties, including the ultimate legal and
beneficial owner or owners of such entities, and any other persons involved or
affected by the transaction(s) contemplated by this Agreement; and

       

      8.5        Maintenance of Business and
legal Structure

       

      (a)       Maintenance of Business
Structure

       

       

      
        
          
          

        

        
          34

          
            

          

        

        
          
          

        

      

       

      not
change the nature, organisation and conduct of its business as, owner of the
Vessel or carry on any business other than the business carried on at the date
hereof;

       

      (b)       Maintenance of Legal
Structure

       

      ensure
that none of the documents defining the constitution of the Borrower and/or any
corporate shareholder shall be altered in any manner whatsoever;

       

      (c)       Control

       

      ensure
that no change shall be made directly or indirectly in the ownership, beneficial
ownership, control or management of the Borrower or any share therein or, of the
Vessel;

       

      (d)       No
merger

       

      not
merge or consolidate with any other company or person;

       

      (e)       Subsidiaries

       

      not
form or acquire any Subsidiaries; and

       

      (f)        Share capital and
distribution

       

      not
purchase or otherwise acquire for value any shares of its capital or distribute
any of its present or future assets, undertakings, rights or revenues to any of
its shareholders;

       

      8.6        Pari passu/Value of
Security

       

      (a)       Pari
passu

       

      ensure
that its obligations under this Agreement shall, without prejudice to the
provisions of this Clause 8.6 at all times rank at least pari passu with all its
other present and future unsecured and unsubordinated Indebtedness with the
exception of any obligations which are mandatorily preferred by law and not by
contract;

       

      (b)       Valuation of the
Vessel

       

      at
any time (and at least once per year) that the Bank might consider to be (at the
reasonable discretion of the Bank) necessary or useful and at the expense of the
Borrower, have the Vessel valued in Dollars, without, unless required by the
Bank, physical inspection and on the basis of sale for prompt delivery and free
of Encumbrances for cash at arm's length on normal commercial terms as between a
willing seller and a willing buyer without taking into account the benefit of
any charterparty or other engagement concerning the Vessel ("the basis of valuation"), by
a shipbroker appointed by the Bank for this purpose at the Bank's sole
discretion;

       

      (c)       Vessel's Value to Debt
Ratio-Additional Security

       

      ensure
and procure that the Security Value shall be in excess of the Security
Requirement and if at any relevant time the Security Value is less than the
Security Requirement, the Borrower shall within thirty (30) days of being
advised by the Bank of such shortfall, either prepay or provide additional
security in form and substance in all respects acceptable to the Bank in an
amount at least equal to the amount of such shortfall. Such additional security
shall be constituted by:

       

       

      
        
          
          

        

        
          35

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (i)

              	
                additional
      pledged cash deposits in favour of the Bank in an amount equal to such
      shortfall with a bank and in an account and manner to be determined by the
      Bank; and/or

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                any
      other security acceptable to the Bank to be provided in a manner
      determined by the Bank.

              

      

       

      
        (d)       The
value of the Vessel shall be determined for the purpose of Clause 8.6(b) as
provided in Clause 8.6(b) and shall be notified by the Bank to the Borrower and
the valuation of such shipbroker shall constitute the value of the Vessel for
the purposes of this Agreement and shall be binding upon the parties hereto. All
costs in connection with such valuation and any valuation of any additional
security provided pursuant to Clause 8.6(c) shall be borne by the Borrower. Any
valuation referred to in Clause 8.6 to be addressed to the
Bank.

         

      

      Provided
however that in the event that the Market Value of the Vessel (determined in
accordance with Clause 8.6(b)) shall be less than the Security Requirement then
the value of the Vessel shall be determined by three (3) shipbrokers appointed
by the Bank for this purpose (one of which shall be the initial valuator) and in
that case the mean of such three (3) valuations of such shipbrokers shall
constitute the value of the Vessel for the purposes of this Agreement and shall
be binding upon the parties hereto.

       

      (e)       Valuation of additional
security

       

      For
the purpose of this Clause 8.6, the market value of any additional security
provided or to be provided to the Bank shall be determined by the Bank in its
absolute discretion without any necessity for the Bank assigning any reason
thereto provided always that if the additional security is in the form of a
collateral vessel such collateral vessel shall be valued in accordance with the
provisions of Clause 8.6(b) or if the additional security is in form of a cash
deposit full credit shall be given for such cash deposit on a Dollar for Dollar
basis.

       

      (f)        Documents and
evidence

       

      In
connection with any additional security provided in accordance with this Clause
8.6, the Bank shall be entitled to receive such evidence and documents as may in
the Bank's reasonable opinion be appropriate and such favourable legal opinions
as the Bank shall in its absolute discretion require.

       

      8.7        Maintenance of
Assets

       

      (a)       No Transfer of
Assets

       

      not
convey, assign, transfer, sell or otherwise dispose of or deal with any of their
real or personal property, assets or rights, whether present or future, without
the prior written consent of the Bank; and

       

      (b)       No Encumbrance of
Assets

       

       

      
        
          
          

        

        
          36

          
            

          

        

        
          
          

        

      

       

      not
allow any part of its undertaking, property, assets or rights, whether present
or future, to be mortgaged, charged, pledged, used as a lien or otherwise
encumbered without the prior written consent of the Bank; and

       

      
        	
                8.8

              	
                Covenants Concerning
      the Vessel

              

      

       

      (a)       Ownership/Management/Control

       

      ensure
that the Vessel will be registered on the Drawdown Date under the laws of the
Flag State and thereafter maintain her present ownership, management, control
and beneficial ownership;

       

      (b)       Class

       

      ensure
that the Vessel will remain in class free of any and all recommendations,
overdue notations or average damage affecting class and provide the Bank on
demand with copies of all class and trading certificates of the
Vessel;

       

      (c)       Insurances

       

      ensure
that all Insurances of the Vessel are maintained and comply with all insurance
requirements specified in this Agreement and in case of failure to maintain the
Vessel so insured authorise the Bank (and such authorisation is hereby expressly
given to the Bank) to have the right but not the obligation to effect such
Insurances on behalf of the Borrower (and in case that the Vessel remains in
port for an extended period to effect port risks insurances at the cost of the
Borrower which, if paid by the Bank, shall be Expenses);

       

      (d)       Transfer/Encumbrances

       

      not
without the prior written consent of the Bank sell or otherwise dispose of the
Vessel or any share therein or create or agree to create or permit to subsist
any Encumbrance over the Vessel (or any share or interest therein) other than
Permitted Encumbrances;

       

      (e)       Not imperil Flag, Ownership,
Insurances

       

      ensure
that the Vessel is maintained and trades in conformity with the laws of the Flag
State, of its owning company or of the nationality of the officers of the
Vessel, the requirements of the Insurances and nothing is done or permitted to
be done which could endanger the flag of the Vessel or its unencumbered (other
than Permitted Encumbrances) ownership or its Insurances;

       

      (f)        Mortgage
Covenants

       

      always
comply with all the covenants provided for in the Mortgage and in any
accompanying Deed of Covenant;

       

      (g)       Charter

       

      not
enter into a charterparty, contract of affreightment, agreement or related
document in respect of the employment of the Vessel (i) on demise charterparty
or (ii) without the prior written consent of the Bank, for a period for more
than twelve (12) months or below the market rate prevailing at the time when the
Vessel is fixed in or on terms which are not in accordance with the commercial
practice prevailing at the relevant time;

       

       

      
        
          
          

        

        
          37

          
            

          

        

        
          
          

        

      

       

      (h)       Assignment of
Earnings

       

      not
assign or agree to assign otherwise than to the Bank the Earnings or any part
thereof; and

       

      (i)        Compliance with
Environmental Laws

       

      comply
with, and procure that all Environmental Affiliates of any Relevant Party comply
with, all Environmental Laws including without limitation, requirements relating
to manning and establishment of financial responsibility and to obtain and
comply with, and procure that all Environmental Affiliates of such Relevant
Party obtain and comply with, all Environmental Approvals and to notify the Bank
forthwith:

       

      
        	
                 
      

              	
                (i)

              	
                of
      any Environmental Claim for an amount or amounts in aggregate exceeding
      $300,000 made against the Vessel, any Relevant Ship and/or her respective
      owner; and

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                upon
      becoming aware of any incident which may give rise to an Environmental
      Claim and to keep the Bank advised in writing of the Borrower's response
      to such Environmental Claim on such regular basis and in such detail as
      the Bank shall require;

              

      

       

      8.9        Observance of
Covenants

       

      (a)       Use of the
Loan

       

      use
the Loan exclusively for the purpose specified in this Agreement;

       

      (b)       Compliance with
Covenants

       

      duly
and punctually perform each of the obligations expressed to be assumed by it
under this Agreement and the other Security Documents;

       

      (c)       Payment on
Demand

       

      pay
to the Bank on demand any sum of money which is payable by the Borrower to the
Bank under this Agreement but in respect of which it is not specified in any
other Clause when it is due and payable; and

       

      (d)       Evidence of
Compliance

       

      upon
request by the Bank from time to time provide such information and evidence to
the Bank as the Bank would reasonably require to demonstrate compliance with the
covenants and undertakings set forth in this Agreement and the other Security
Documents;

       

      8.10      Validity of Securities —
Taxes etc.

       

      (a)       Validity

       

      ensure
and procure that all governmental or other consents required by law and/or any
other steps required for the validity, enforceability and legality of this
Agreement and the other Security Documents are maintained in full force and
effect and/or appropriately taken;

       

       

      
        
          
          

        

        
          38

          
            

          

        

        
          
          

        

      

       

      (b)       Earnings

       

      ensure
and procure that, unless and until directed by the Bank otherwise (i) all the
Earnings of the Vessel shall be paid to the Earnings Account and (ii) the
persons from whom the Earnings are from time to time due are irrevocably
instructed to pay them to such account in the name of the Borrower as shall be
from time to time agreed by the Bank in accordance with the provisions hereof
and of the relevant Security Documents;

       

      (c)       Taxes

       

      pay
all Taxes, assessments and other governmental charges when the same fall due,
except to the extent that the same are being contested in good faith by
appropriate proceedings and adequate reserves have been set aside for their
payment if such proceedings fail; and

       

      (d)       Additional
Documents

       

      from
time to time and within ten (10) days after the Bank's request execute and
deliver to the Bank or procure the execution and delivery to the Bank of all
such documents as shall be deemed desirable at the reasonable discretion of the
Bank for giving full effect to this Agreement, and for perfecting, protecting
the value of or enforcing any rights or securities granted to the Bank under any
one or more of this Agreement, the other Security Documents and any other
documents executed pursuant hereto or thereto and in case that any conditions
precedent (with the Bank's consent) have not been fulfilled prior to the
Drawdown, such conditions shall be complied with within fourteen (14) days of
Drawdown (unless the Bank agrees otherwise in writing) and failure to comply
with this covenant shall be an Event of Default.

       

      8.11      Covenants for the Security
Parties

       

      Ensure
and procure that all other Security Parties and each of them duly and punctually
comply, with the covenants in Clauses 8.1 to 8.10 which are applicable to them
mutatis mutandis.

       

      8.12      Compliance with the ISM
Code

       

      Procure
that the Approved Manager and any Operator:

       

      
        	
                 
      

              	
                (a)

              	
                will
      comply with and ensure that the Vessel and any Operator by no later than
      the Drawdown Date complies with the requirements of the ISM Code,
      including (but not limited to) the maintenance and renewal of valid
      certificates pursuant thereto throughout the Security
    Period;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                immediately
      inform the Bank if there is any threatened or actual withdrawal of the
      Borrower's, the Approved Manager's or an Operator's DOC or the SMC in
      respect of the Vessel; and

              

      

       

      
        	
                 
      

              	
                (c)

              	
                promptly
      inform the Bank upon the issue to the Borrower, the Approved Manager or
      any Operator of a DOC and to the Vessel of an SMC or the receipt by the
      Borrower, the Approved Manager or any Operator of notification that its
      application for the same has been
realised.

              

      

       

       

      
        
          
          

        

        
          39

          
            

          

        

        
          
          

        

      

       

      8.13      ISPS Code
Compliance

       

       Procure
that the Approved Manager or any Operator will:

       

      
        	
                 
      

              	
                (a)

              	
                maintain
      at all times a valid and current ISSC respect of the
    Vessel;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                immediately
      notify the Bank in writing of any actual or threatened withdrawal,
      suspension, cancellation or modification of the ISSC in respect of the
      Vessel; and

              

      

       

      9.          EVENTS OF
DEFAULT

       

      There
shall be an Event of Default whenever an event described in Clauses 9.1 to 9.7
Occurs:

       

      9.1        Non Performance of
Obltgations

       

      
        	
                 
      

              	
                (a)

              	
                the
      Borrower or any other Security Party fails to pay any sum due from the
      Borrower or, as the case may be such Security Party, under this Agreement
      and/or any of the other Security Documents at the time, in the currency
      and in the manner stipulated herein and/or any of the other Security
      Documents, or, in the case of any sum payable on demand, within three (3)
      Banking Days of such demand; or

              

      

       

      
        	
                 
      

              	
                (b)

              	
                the
      Borrower or any other Security Party fails to observe and perform any one
      or more of the covenants, terms or obligations contained in this Agreement
      and/or any other Security Document relating to the Insurances;
      or

              

      

       

      
        	
                 
      

              	
                (c)

              	
                the
      Borrower or any other Security Party commits any breach of or omits to
      observe any of the covenants, terms, obligations or undertakings under
      this Agreement and/or any of the other Security Documents (other than
      failure to pay any sum when due or to comply with any obligation
      concerning the Insurances) and, in respect of any such breach or omission
      which in the opinion of the Bank is capable of remedy, such action as the
      Bank may require shall not have been taken within seven (7) days of the
      Bank notifying the Borrower and/or the relevant Security Party of such
      required action to remedy the breach or omission;
  or

              

      

       

      9.2        Events affecting the
Security Parties

       

      
        	
                 
      

              	
                (a)

              	
                any
      Security Party is adjudicated or found bankrupt or insolvent or any
      judgement or order is made by any competent court or resolution passed or
      petition (which is not in the reasonable opinion of the Bank frivolous and
      is not being contested in good faith by such Security Party) presented for
      the winding-up or dissolution of any Security Party or for the appointment
      of a liquidator, trustee, receiver, administrator or conservator of the
      whole or any part of the undertakings, assets, rights or revenues of any
      Security Party; or

              

      

       

      
        	
                 
      

              	
                (b)

              	
                any
      Security Party becomes or is deemed to be insolvent or suspends payment of
      its debts or is (or is deemed to be) unable to or admits inability to pay
      its debts as they fall due or proposes or enters into any composition,
      compromise or other arrangement for the benefit of its creditors generally
      or good faith proceedings are commenced in relation to any Security Party
      under any law, regulation or procedure relating to reconstruction or
      readjustment of debts; or

              

      

       

      
        	
                 
      

              	
                (c)

              	
                an
      encumbrancer takes possession or a receiver or similar officer is
      appointed of the whole or any part of the undertakings, assets, rights or
      revenues of any Security Party or a distress, execution, sequestration or
      other process is levied or enforced upon or sued out against any of the
      undertakings, assets, rights or revenues of any Security Party and is not
      discharged within fifteen (15) days;
or

              

      

       

       

      
        
          
          

        

        
          40

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (d)

              	
                all
      or a material part of the undertakings, assets, rights or revenues of any
      Security Party are seized, nationalised, expropriated or compulsorily
      acquired by or under the authority of any government;
  or

              

      

       

      
        	
                 
      

              	
                (e)

              	
                any
      event occurs or proceeding is taken with respect to any Security Party in
      any jurisdiction to which it is subject which has an effect equivalent or
      similar to any of the events mentioned in sub-Clauses 9.2(a) to 9.2(d);
      or

              

      

       

      
        	
                 
      

              	
                (f)

              	
                any
      Security Party suspends or ceases or threatens to suspend or cease to
      carry on its business; or

              

      

       

      
        	
                 
      

              	
                (g)

              	
                there
      occurs, in the reasonable opinion of the Bank, a material adverse change
      in the financial condition of any Security Party;
  or

              

      

       

      
        	
                 
      

              	
                (h)

              	
                any
      other event occurs or circumstances arise which, in the reasonable opinion
      of the Bank, materially and adversely affects either (i) the ability of
      any Security Party to perform all or any of its obligations under or
      otherwise to comply with the terms of this Agreement and/or any of the
      other Security Documents, or (ii) the security created by this Agreement
      and/or any of the Security Documents;
or

              

      

       

      
        	
                 
      

              	
                (i)

              	
                there
      is any material change in the beneficial ownership of the shares in the
      Borrower and/or in any other corporate Security Party;
  or

              

      

       

      
        	
                 
      

              	
                (j)

              	
                a
      meeting is convened by any Security Party for the purpose of passing any
      resolution to purchase, reduce or redeem any of its share capital;
      or

              

      

       

      
        	
                 
      

              	
                (k)

              	
                there
      is any material change in the beneficial ownership of the shares in any of
      the Borrower and/or in any other corporate Security Party, as a result of
      which Mr. Evangelos Pistiolis' and/or members of his family's controlling
      interest in the Corporate Guarantor shall be reduced to less than five per
      centum (5%) of the share capital of the Corporate Guarantor;
      or

              

      

       

      9.3        Representations
Incorrect

       

      any
representation or warranty made or deemed to be made or repeated by or in
respect of any Security Party in or pursuant to this Agreement or any of the
other Security Documents or in any notice, certificate or statement referred to
in or delivered under this Agreement or any of the other Security Documents is
or proves to have been incorrect in any material respect; or

       

      9.4        Cross-default of the
Borrower and the Group

       

      any
Indebtedness of the Borrower or any other member of the Group is not paid when
due or becomes due and payable, or any creditor of the Borrower or such member
of the Group becomes entitled to declare any such Indebtedness due and payable
prior to the date when it would otherwise have become due, or any guarantee or
indemnity given or any obligation or covenant undertaken or agreement made by
the Borrower any other member of the Group in respect of Indebtedness is not
honoured when due; or

       

      9.5        Events affecting the
Security Documents

       

       

      
        
          
          

        

        
          41

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (a)

              	
                this
      Agreement or any of the other Security Documents shall at any time and for
      any reason become invalid or unenforceable or otherwise cease to remain in
      full force and effect, or if the validity or enforceability of any of the
      Security Documents shall at any time and for any reason be contested by
      any party thereto (other than the Bank), or if any such party shall deny
      that it has any, or any further, liability thereunder or it becomes
      impossible or unlawful for the Borrower to fulfil any of its covenants and
      obligations contained in this Agreement or any of the Security Documents
      or for the Bank to exercise the rights vested in it thereunder or
      otherwise; or

              

      

       

      
        	
                 
      

              	
                (b)

              	
                any
      consent, authorisation, licence or approval of, or registration with or
      declaration to, governmental or public bodies or authorities or courts
      required by the Borrower to authorise or otherwise in connection with, the
      execution, delivery, validity, enforceability or admissibility in evidence
      of this Agreement and/or any of the other Security Documents or the
      performance by the Borrower of its obligations under this Agreement and/or
      any of the other Security Documents is modified in a manner unacceptable
      to the Bank or is not granted or is revoked or terminated or expires and
      is not renewed or otherwise ceases to be in full force and effect;
      or

              

      

       

      
        	
                 
      

              	
                (c)

              	
                any
      Encumbrance (other than Permitted Liens) in respect of any of the property
      (or part thereof) which is the subject of the Security Documents (or any
      of them) becomes enforceable; or

              

      

       

      9.6        Events concerning the
Security Parties

       

      
        	
                 
      

              	
                (a)

              	
                any
      Security Party (other than the Borrower) fails to pay any sum due from it
      under this Agreement and/or any of the Security Documents when due, or, in
      the case of any sum payable on demand, within three (3) Banking Days of
      demand; or

              

      

       

      
        	
                 
      

              	
                (b)

              	
                any
      Security Party (other than the Borrower) fails to observe and perform any
      one or more of the covenants, terms or obligations contained in this
      Agreement (including Schedule 2) and/or the other Security Documents
      relating to the Insurances; or

              

      

       

      
        	
                 
      

              	
                (c)

              	
                any
      Security Party (other than the Borrower) commits any breach of or omits to
      observe any of the covenants, terms, obligations or undertakings expressed
      to be assumed by it under this Agreement and/or any of the Security
      Documents (other than failure to pay any sum when due or to observe or
      perform obligations relating to the Insurances) and, in respect of any
      such breach or omission which in the opinion of the Bank is capable of
      remedy, such action as the Bank may require shall not have been taken
      within seven (7) days of the Bank notifying the relevant Security Party,
      of such required action to remedy the breach or omission;
    or

              

      

       

      
        	
                 
      

              	
                (d)

              	
                any
      representation or warranty made or deemed to be made or repeated by or in
      respect of any Security Party (other than the Borrower) in or pursuant to
      this Agreement or any of the other Security Documents or in any notice,
      certificate or statement referred to in or delivered under this Agreement
      or any of the other Security Documents is or proves to have been incorrect
      in any material respect; or

              

      

       

      
        	
                 
      

              	
                (e)

              	
                any
      of the events referred to in Clauses 9.2 to 9.5 occurs (amended as
      appropriate) in relation to any Security Party (other than the Borrower);
      or

              

      

       

       

      
        
          
          

        

        
          42

          
            

          

        

        
          
          

        

      

       

      9.7        Events concerning the
Vessel

       

      
        	
                 
      

              	
                (a)

              	
                the
      Vessel becomes a Total Loss or suffers damage or is involved in an
      incident which in the reasonable opinion of the Bank may result in the
      Vessel being subsequently determined to be a Total Loss and the insurance
      indemnity is not paid by the insurers to the Bank under the General
      Assignment within a period of one hundred fifty (150) days from the
      earlier of: (i) the date such Total Loss occurred and (ii) the date on
      which the incident which in the reasonable opinion of the Bank may result
      in the Vessel being subsequently determined to be a Total Toss has
      occurred; or

              

      

       

      
        	
                 
      

              	
                (b)

              	
                the
      Vessel ceases to be managed by the Approved Manager (for any reason other
      than the reason of a Total Loss or sale of the Vessel) with the approval
      of the Bank, and the Borrower fails to appoint an Approved Manager within
      seven (7) days after the termination of the Management Agreement with the
      previous Approved Manager; or

              

      

       

      
        	
                 
      

              	
                (c)

              	
                the
      Vessel is arrested, confiscated, seized, taken in execution, impounded,
      forfeited, detained in exercise or purported exercise of any possessory
      lien or other claim and the Owner shall fail to procure the release of the
      Vessel within a period of seven (7) days thereafter;
  or

              

      

       

      
        	
                 
      

              	
                (d)

              	
                the
      registration of the Vessel under the laws and flag of the Flag State is
      cancelled or terminated without the prior written consent of the Bank or,
      if the Vessel is only provisionally registered on the Drawdown Date and is
      not permanently registered under the laws and flag of the Flag State at
      least thirty (30) days prior to the deadline for completing such permanent
      registration;

              

      

       

      
        	
                 
      

              	
                (e)

              	
                the
      Flag State of the Vessel becomes involved in hostilities or civil war or
      there is a seizure of power in such Flag State by unconstitutional means
      if, in any such case, such event could in the reasonable opinion of the
      Bank reasonably be expected to have a material adverse effect on the
      security constituted by any of the Security Documents and alternative
      arrangements satisfactory to the Bank have not been made promptly upon the
      Bank's request; or

              

      

       

      
        	
                 
      

              	
                (f)

              	
                the
      Borrower or any other person fails or omits to comply with any
      requirements of the protection and indemnity association or other insurer
      with which the Vessel is entered for insurance or insured against
      protection and indemnity risks (including oil pollution risks) to the
      effect that any cover (including, without limitation, any cover in respect
      of liability for Environmental Claims arising in jurisdiction where the
      Vessel operates or trades) is or may be liable to cancellation,
      qualification or exclusion at any time;
or

              

      

       

      
        	
                 
      

              	
                (g)

              	
                (without
      prejudice to the generality of sub-Clauses 9.1(b) and (c)) for any reason
      whatsoever the provisions of Clause 8.12 are not complied with and/or the
      Vessel ceases to comply with the ISM Code;
or

              

      

       

      
        	
                 
      

              	
                (h)

              	
                (without
      prejudice to the generality of sub-Clauses 9.1(b) and (c)) for any reason
      whatsoever the provisions of Clause 8.13 are not complied with and/or the
      Vessel ceases to comply with the ISPS Code;
or

              

      

       

      9.8        Environmental
Events

       

       

      
        
          
          

        

        
          43

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (a)

              	
                any
      Relevant Party and/or the Approved Manager and/or any of their respective
      Environmental Affiliates fails to comply with any Environmental Law or any
      Environmental Approval or the Vessel or any Relevant Ship is involved in
      any incident which gives rise or which may give rise to any Environmental
      Claim, if in any such case, such non compliance or incident or the
      consequences thereof could (in the reasonable opinion of the Bank) be
      expected to have a material adverse effect on the business assets,
      operations, property or financial condition of the Borrower or any other
      Security Party or on the security created by any of the Security
      Documents; or

              

      

       

      
        	
                 
      

              	
                (b)

              	
                any
      Security Party or any other person fails or omits to comply with any
      requirements of the protection and indemnity association or other insurer
      with which the Vessel is entered for insurance or insured against
      protection and indemnity risks (including oil pollution risks) to the
      effect that any cover in relation to the Vessel (including without
      limitation, liability for Environmental Claims arising in jurisdictions
      where the Vessel operates or trades) is or may be liable to cancellation,
      qualification or exclusion at any time;
or

              

      

       

      9.9        Consequences of
Default

       

      The
Bank may without prejudice to any other rights of the Bank (which will continue
to be in force concurrently with the following), at any time after the happening
of an Event of Default:

       

      
        	
                 
      

              	
                (a)

              	
                by
      notice to the Borrower declare that the obligation of the Bank to make the
      Commitment available shall be terminated, whereupon the Commitment shall
      be reduced to zero forthwith;
and/or

              

      

       

      
        	
                 
      

              	
                (b)

              	
                by
      notice to the Borrower declare that the Loan and all interest and
      commitment commission accrued and all other sums payable under this
      Agreement and the other Security Documents have become due and payable,
      whereupon the same shall, immediately or in accordance with the terms of
      such notice, become due and payable without any further diligence,
      presentment, demand of payment, protest or notice or any other procedure
      from the Bank which are expressly waived by the Borrower;
      and/or

              

      

       

      
        	
                 
      

              	
                (c)

              	
                put
      into force and exercise all or any of the rights, powers and remedies
      possessed by it under this Agreement and/or under any other Security
      Document and/or as mortgagee of the Vessel, mortgagee, chargee or assignee
      or as the beneficiary of any other property right or any other security
      (as the case may be) over the assets charged or assigned to it under the
      Security Documents or otherwise (whether at law, by virtue of any of the
      Security Documents or otherwise).

              

      

       

      9.10      Insolvency Events of
Default

       

      If
an event occurs in respect of the Borrower or the other Security Parties of the
type described in sub-Clauses 9.2(a) to (e) (except (i) in the case when a
petition was presented or proceedings were commenced or a suit or writ were
issued by a third party and the Borrower or the relevant Security Party is
defending itself in bona fide and (ii) in the case that such events mentioned in
Clause 9.2 relate to only a part of the undertakings, assets, rights or revenues
which in the opinion of the Bank does not affect the ability of the Borrower or
the relevant Security Party to perform its respective obligations under this
Agreement and/or the other Security Documents) the obligation of the Bank to
make the Commitment available shall 

       

       

      
        
          
          

        

        
          44

          
            

          

        

        
          
          

        

      

       

      terminate
immediately upon receipt by the Bank of the relevant information (as such
receipt shall be conclusively certified by a certificate of the Bank) and all
amounts payable under sub-Clause 9.9(b) above shall become immediately due and
payable without any notice or other formality which is hereby expressly waived
by the Borrower.

       

      9.11      Proof of
Default

       

      It
is agreed that (i) the non-payment of any sum of money in time will be proved
conclusively by mere passage of time and (ii) the occurrence of this (non
payment) shall be proved conclusively by a mere written statement of the Bank
(save for manifest error).

       

      9.12      Exclusion of Bank's
liability

       

      Neither
the Bank nor any receiver or manager appointed by the Bank, shall have any
liability to the Borrower or any other Security Party:

       

      
        	
                 
      

              	
                (a)

              	
                for
      any loss caused by an exercise of rights under, or enforcement of an
      Encumbrance created by, a Security Document or by any failure or delay to
      exercise such a right or to enforce such an Encumbrance;
  or

              

      

       

      
        
          	
                   
      

                	
                  (b)

                	
                  as
      mortgagee in possession or otherwise, for any income or principal amount
      which might have been produced by or realised from any asset comprised in
      such an Encumbrance or for any reduction (however caused) in the value of
      such an asset, 

                

          
             

            except
that this does not exempt the Bank or a receiver or manager from liability for
losses shown to have been caused by the wilful misconduct of the Bank's own
officers and employees or (as the case may be) such receiver's or manager's own
partners or employees.

          

        

      

       

      10.        INDEMNITIES - EXPENSES -
FEES

       

      10.1      Indemnity

       

      The
Borrower shall on demand (and it is hereby expressly undertaken by the Borrower
to) indemnify the Bank, without prejudice to any of the other rights of the Bank
under any of the Security Documents, against any loss or expense which the Bank
shall certify as sustained or incurred as a consequence of:

       

      
        	
                 
      

              	
                (a)

              	
                any
      default in payment by any of the Security Parties of any sum under any of
      the Security Documents when due;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                the
      occurrence of any Event of Default;

              

      

       

      
        	
                 
      

              	
                (c)

              	
                any
      prepayment of the Loan or part thereof being made under Clauses 4.2(b) and
      4.3, 8.6(c) or 12 or any other repayment of the Loan or part thereof being
      made otherwise than on an Interest Payment Date relating to the part of
      the Loan prepaid or repaid; or

              

      

       

      
        	
                 
      

              	
                (d)

              	
                the
      Commitment not being advanced for any reason (excluding any default by the
      Bank) after the Drawdown Notice has been
given,

              

      

       

      including,
in any such case, but not limited to, any loss or expense sustained or incurred
in maintaining or funding the Loan or any part thereof or in liquidating or
re-employing deposits from third parties acquired to effect or maintain the Loan
or any part thereof.

       

       

      
        
          
          

        

        
          45

          
            

          

        

        
          
          

        

      

       

      10.2      Expenses

       

       

       The
Borrower shall (and it is hereby expressly undertaken by the Borrower to) pay to
the Bank on demand:

       

      
        	
                 
      

              	
                (a)

              	
                Initial and Amendment
      expenses

              

      

       

      all
expenses (including legal, printing and out-of-pocket expenses) reasonably
incurred by the Bank in connection with the negotiation, preparation and
execution of this Agreement and the other Security Documents and of any
amendment or extension of or the granting of any waiver or consent under this
Agreement and/or any of the Security Documents and/or in connection with any
proposal by the Borrower to constitute additional security pursuant to
sub-Clause 8.6(c), whether any such security shall in fact be constituted or
not;

       

      
        	
                 
      

              	
                (b)

              	
                Enforcement
      expenses

              

      

       

      all
expenses (including legal and out-of-pocket expenses) incurred by the Bank in
contemplation of, or otherwise in connection with, the enforcement of, or
preservation of any rights under, this Agreement and/or any of the other
Security Documents, or otherwise in respect of the moneys owing under this
Agreement and/or any of the other Security Documents or the contemplation or
preparation of the above, whether they have been effected or not;

       

      
        	
                 
      

              	
                (c)

              	
                MII-MAPI
      costs

              

      

       

      reimburse
the Bank on demand for any and all costs incurred by the Bank (as conclusively
certified by the Bank) in effecting and keeping effected (a) a Mortgagee's
Interest Insurance for an amount equal to 120% of the amount of the Loan (herein
"MII") and (b) (in case that the Bank reasonably determines or in case that the
Vessel is scheduled to operate worldwide which could include USA jurisdiction or
the USA Exclusive Economic Zone (as defined in the United States Oil Pollution
Act 1990 or any other applicable legislation or in waters with similar to the
United States Oil Pollution Act 1990 legislation), a Mortgagee's Interest
Additional Perils (Pollution) insurance policy (herein "MAPI"), each of which
the Bank may at any time effect on such terms and with such insurers as shall
from time to time be determined by the Bank,; and

       

      
        	
                 
      

              	
                (d)

              	
                Other
      expenses

              

      

       

      any
and all other Expenses.

       

       All
expenses payable pursuant to this Clause 10.2 shall be paid together with value
added tax (if any) thereon.

       

      10.3      Stamp
duty

       

      The
Borrower shall pay any and all stamp, registration and similar taxes or charges
(including those payable by the Bank) imposed by governmental authorities in
relation to this Agreement and any of the other Security Documents, and shall
indemnify the Bank against any and all liabilities with respect to, or resulting
from delay or omission on the part of the Borrower to pay such stamp taxes or
charges.

       

      10.4      Environmental
Indemnity

       

      The
Borrower shall indemnify the Bank on demand and hold the Bank harmless from and
against all costs, expenses, payments, charges, losses, demands, liabilities,
actions, proceedings (whether civil or criminal) penalties, fines, damages,
judgements, orders, sanctions or other outgoings of whatever nature which may be
suffered, incurred or paid by, or made 

       

       

      
        
          
          

        

        
          46

          
            

          

        

        
          
          

        

      

       

      or
asserted against the Bank at any time, whether before or after the repayment in
full of principal and interest under this Agreement, relating to, or arising
directly or indirectly in any manner or for any cause or reason out of an
Environmental Claim made or asserted against the Bank.

       

      10.5      Currencies

       

      If
any sum due from the Borrower under any of the Security Documents or any order
or judgement given or made in relation hereto has to be converted from the
currency (the "first currency")
in which the same is payable under the relevant Security Document or
under such order or judgement into another currency (the "second currency") for the
purpose of (i) making or filing a claim or proof against the Borrower or any
other Security Party, as the case may be or (ii) obtaining an order or judgement
in any court or other tribunal or (iii) enforcing any order or judgement given
or made in relation to any of the Security Documents, the Borrower shall (and it
is hereby expressly undertaken by the Borrower to) indemnify and hold harmless
the Bank from and against any loss suffered as a result of any difference
between (a) the rate of exchange used for such purpose to convert the sum in
question from the first currency into the second currency and (b) the rate or
rates of exchange at which the Bank may in the ordinary course of business
purchase the first currency with the second currency upon receipt of a sum paid
to it in satisfaction, in whole or in part, of any such order, judgement, claim
or proof. The term "rate of
exchange" includes any premium and costs of exchange payable in
connection with the purchase of the first currency with the second
currency.

       

      10.6      Maintenance of the
Indemnities

       

      The
indemnities contained in this Clause 10 shall apply irrespective of any
indulgence granted to the Borrower or any other party from time to time and
shall continue to be in full force and effect notwithstanding any payment in
favour of the Bank and any sum due from the Borrower under this Clause 10 will
be due as a separate debt and shall not be affected by judgement being obtained
for any other sums due under any one or more of this Agreement, the other
Security Documents and any other documents executed pursuant hereto or
thereto.

       

      10.7      Communications
Indemnity

       

      It
is hereby agreed in connection with communications that:

       

      
        	
                 
      

              	
                (a)

              	
                Express
      authority is hereby given by the Borrower to the Bank to accept (at the
      sole discretion of the Bank) all tested or untested communications given
      by facsimile, telex, cable or otherwise, regarding any or all of the
      notices, requests, instructions or other communications under this
      Agreement, subject to any restrictions imposed by the Bank relating to
      such communications including, without limitation (if so required by the
      Bank), the obligation to confirm such communications by
      letter.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                The
      Borrower shall recognise any and all of the said notices, requests,
      instructions or other communications as legal, valid and binding, when
      these notices, requests, instructions or communications come from the
      telex and fax numbers mentioned in Clause 15.1 or any other telex or fax
      usually used by it or its managing
company.

              

      

       

       

      
        
          
          

        

        
          47

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (c)

              	
                The
      Borrower hereby assumes full responsibility for the execution of the said
      notices, requests, instructions or communications by the Bank and promises
      and recognises that the Bank shall not be held responsible for any loss,
      liability or expense that may result from such notices, requests,
      instructions or other communications. It is hereby undertaken by the
      Borrower to indemnify in full the Bank from and against all actions,
      proceedings, damages, costs, claims, demands, expenses and any and all
      direct and/or indirect losses which the Bank may suffer, incur or sustain
      by reason of the Bank following such notices, requests, instructions or
      communications.

              

      

       

      
        	
                 
      

              	
                (d)

              	
                With
      regard to notices, requests, instructions or communications issued by
      electronic and/or mechanical processes (e.g. by facsimile, telex), the
      risk of equipment malfunction, including, without limitation, paper
      shortage, transmission errors, omissions and distortions is assumed fully
      and accepted by the Borrower, save in case of Bank's gross
      misconduct.

              

      

       

      
        	
                 
      

              	
                (e)

              	
                The
      risks of misunderstandings and errors resulting from notices, requests,
      instructions or communications being given as mentioned above, are for the
      Borrower and the Bank will be indemnified in full pursuant to this Clause
      save in case of Bank's gross
misconduct.

              

      

       

      
        	
                 
      

              	
                (f)

              	
                The
      Bank shall have the right to ask the Borrower to furnish any information
      the Bank may require to establish the authority of any person purporting
      to act on behalf of the Borrower for these notices, requests, instructions
      or communications but it is expressly agreed that there is no obligation
      for the Bank to do so. The Bank shall be fully protected in, and the Bank
      shall incur no liability to the Borrower for acting upon the said notices,
      requests, instructions or communications which were believed by the Bank
      in good faith to have been given by the Borrower or by any of its
      authorised representative(s).

              

      

       

      
        	
                 
      

              	
                (g)

              	
                It
      is undertaken by the Borrower to safeguard the function and the security
      of the electronic and mechanical appliance(s) such as telex(es), fax(es)
      etc., as well as the code word list, if any, and to take adequate
      precautions to protect such code word list from loss and to prevent its
      terms becoming known to any persons not directly concerned with its use.
      The Borrower shall hold the Bank harmless and indemnified from all claims,
      losses, damages and expenses which the Bank may incur by reason of the
      failure of the Borrower to comply with the obligations under this
      Clause.

              

      

       

      10.8      Arrangement Fee -Commitment
Commission

       

      
        	
                 
      

              	
                (a)

              	
                As
      an inducement for the Bank to enter into this Agreement the Borrower shall
      pay on the Drawdown Date an arrangement fee in the amount of Dollars one
      hundred seventy five thousand ($175,000);
and

              

      

       

      
        	
                 
      

              	
                (b)

              	
                The
      Borrower shall pay to the Bank in arrears on each of the dates falling at
      three monthly intervals after the date of acceptance of the Commitment
      Letter until the earlier of (a) the last day of the Availability Period
      (b) the Drawdown Date and (c) the date of cancellation of the Commitment
      in full by the Borrower (the "Commitment Commission Period")
      commitment commission at the rate of 0.35% per annum on the daily
      undrawn and uncancelled amount of the Commitment, computed from the date
      of acceptance of the Commitment Letter (in the case of the first payment
      of commission) and from the date of the preceding payment of commission
      (in the case of each subsequent payment) until the last day of the
      Commitment Commission Period.

              

      

       

       

      
        
          
          

        

        
          48

          
            

          

        

        
          
          

        

      

       

      The
arrangement fee and commitment commission referred to in this Clause 10.8 are
not refundable and shall be payable by the Borrower to the Bank whether or not
any part of the Commitment is ever advanced.

       

      10.9      Central Bank or European
Central Bank reserve requirements indemnity

       

      The
Borrower shall on demand promptly indemnify the Bank against any cost incurred
or loss suffered by the Bank as a result of its complying with the minimum
reserve requirements of the European Central Bank and/or with respect to
maintaining required reserves with the relevant national Central Bank to the
extent that such compliance relates to the Commitment or deposits obtained by it
to fund the whole or part of the Loan and to the extent such cost or loss is not
recoverable by the Bank under clause 12.2

       

      11.        SECURITY, APPLICATION, AND
SET-OFF

       

      11.1      Securities

       

       

      As
security for the due and punctual repayment of the Loan and payment of interest
thereon as provided in this Agreement and of all other Outstanding Indebtedness,
the Borrower shall ensure and procure that the following Security Documents are
duly executed and, where required, registered in favour of the Bank in form and
substance satisfactory to the Bank at the time specified herein or otherwise as
required by the Bank and ensure that such security consists, on the Drawdown
Date in respect of the Loan, of:

       

      
        	
                 
      

              	
                (a)

              	
                the
      Mortgage duly registered over the Vessel through the
    Registry;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                the
      General Assignment;

              

      

       

      
        	
                 
      

              	
                (c)

              	
                the
      Corporate Guarantee;

              

      

       

      
        	
                 
      

              	
                (d)

              	
                the
      Accounts Pledge Agreement;

              

      

       

      
        	
                 
      

              	
                (e)

              	
                the
      Shares Pledge Agreement;

              

      

       

      
        	
                 
      

              	
                (f)

              	
                the
      Manager's Undertaking; and

              

      

       

      
        	
                 
      

              	
                (g)

              	
                any
      Charterparty Assignment;

              

      

       

      11.2      Maintenance of
Securities

       

      It
is hereby undertaken by the Borrower that the Security Documents shall both at
the date of execution and delivery thereof and so long as any moneys are owing
and/or due under this Agreement or under the other Security Documents be valid
and binding obligations of the respective Security Parties thereto and rights of
the Bank enforceable in accordance with their respective terms and that they
will, at the expense of the Borrower, execute, sign, perfect and do any and
every such further assurance, document, act, omission or thing as in the opinion
of the Bank may be necessary or desirable for perfecting the security
contemplated or constituted by the Security Documents.

       

      11.3      Application of
funds

       

       

      
        
          
          

        

        
          49

          
            

          

        

        
          
          

        

      

       

      All
moneys received by the Bank under or pursuant to any of the Security Documents
and expressed to be applicable in accordance with this Clause 11.3 shall be
applied by the Bank in the following manner:

       

      
        	
                 
      

              	
                (a)

              	
                Firstly in or towards
      payment of Expenses and all sums other than principal or interest which
      may be due to the Bank under this Agreement and the other Security
      Documents or any of them at the time of
  application;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                Secondly in or towards
      payment of any default interest;

              

      

       

      
        	
                 
      

              	
                (c)

              	
                Thirdly in or towards
      payment of any arrears of interest (other than default interest) due in
      respect of the Loan or any part
thereof;

              

      

       

      
        	
                 
      

              	
                (d)

              	
                Fourthly in or towards
      repayment of the Loan whether the same is due and payable or
      not;

              

      

       

      
        	
                 
      

              	
                (e)

              	
                Fifthly in or towards
      payment to the Bank for any loss suffered by reason of any such payment in
      respect of principal not being effected on an Interest Payment Date
      relating to the part of the Loan
repaid;

              

      

       

      
        	
                 
      

              	
                (f)

              	
                Sixthly in or towards
      payment of the Master Agreement Liabilities;
and

              

      

       

      
        	
                 
      

              	
                (g)

              	
                Seventhly the surplus
      (if any) shall be paid to the Borrower, or to whomsoever else shall be
      entitled to receive such surplus.

              

      

       

      11.4      Set off

       

      Express
authority is hereby given by the Borrower to the Bank without prejudice to any
of the rights of the Bank at law, contractually or otherwise, at any time after
a Default has occurred and without notice to the Borrower:

       

      
        	
                 
      

              	
                (a)

              	
                to
      apply any credit balance standing upon any account of the Borrower with
      any branch of the Bank and in whatever currency in or towards satisfaction
      of any sum due to the Bank from the Borrower under this Agreement, the
      Master Agreement and/or any of the other Security
    Documents;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                in
      the name of the Borrower and/or the Bank to do all such acts and execute
      all such documents as may be necessary or expedient to effect such
      application; and

              

      

       

      
        	
                 
      

              	
                (c)

              	
                to
      combine and/or consolidate all or any accounts in the name of the Borrower
      with the Bank.

              

      

       

      
        	
                 
      

              	
                (d)

              	
                For
      all or any of the above purposes authority is hereby given to the Bank to
      purchase with the moneys standing to the credit of any such account or
      accounts such other currencies as may be necessary to effect such
      application. The Bank shall not be obliged to exercise any right given by
      this Clause.

              

      

       

      
        	
                 
      

              	
                (e)

              	
                The
      rights conferred on the Bank by this Clause 11.4 shall be in addition to,
      and without prejudice to or limitation of, the rights of netting and set
      off conferred on the Bank by the Master Agreement. The Borrower
      acknowledges that the Bank shall be under no obligation to make any
      payment to the Borrower under or pursuant to the Master Agreement if, at
      the time that payment becomes due, there shall have occurred an Event of
      Default or Termination Event (as those terms are respectively defined in
      the Master Agreement).

              

      

       

       

      
        
          
          

        

        
          50

          
            

          

        

        
          
          

        

      

       

      11.5      Earnings Account - Retention
Account

       

      
        	
                 
      

              	
                (a)

              	
                The
      Borrower shall procure that all moneys payable in respect of the Earnings
      of the Vessel shall be paid to the Earnings Account free from
      Encumbrances. Unless and until an Event of Default shall occur (whereupon
      the provisions of Clause 11.3 shall be applicable) no monies shall be
      withdrawn from the Earnings Account save as hereinafter
      provided:

              

      

       

      
        	
                 
      

              	
                (i)

              	
                first: in payment of any and all
      sums whatsoever due and payable to the Bank hereunder (such sums to be
      paid in such order as the Bank may in its sole discretion
      elect);

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                second: during
      each month of the Security Period (but by no later than, in the case of
      the first such month, the date falling thirty (30) days after the Drawdown
      Date and, in the case of each subsequent month, the same date of that
      month), the Borrower shall cause to be transferred from the Earnings
      Account to the Retention Account of the aggregate amount of the Earnings
      of the Vessel received in the Earnings Account during the preceding
      month:

              

      

       

      
        
          	
                   
      

                	
                  aa)

                	
                  one
      sixth (1/6th)
      of the amount of the Repayment Instalment specified in Clause 4.1 falling
      due for payment on the next following Repayment Date;
  and

                

        

      

       

      
        	
                 
      

              	
                bb)

              	
                the
      relevant fraction of the amount of interest on the Loan falling due on the
      next due date for payment of interest under this
  Agreement.

              

      

       

      
        
          	
                   
      

                	
                   

                	The expression "relevant fraction" in
      relation to an amount of interest on the Loan falling due for payment
      means a fraction (which shall be notified by the Bank to the Borrower at
      the beginning of each Interest Period) where the numerator is always one
      and where the denominator shall always be three except in the case of an
      Interest Period of less than three months, in which case the denominator
      shall be the number of months comprised in such Interest Period;
  and

        

      

       

      
        	
                 
      

              	
                (iii)

              	
                thirdly: any
      balance shall be released to the
Borrower.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                If
      the aggregate amount of the Earnings of the Vessel received in the
      Earnings Account is insufficient in any month for the required transfer to
      be made from the Earnings Account to the Retention Account in accordance
      with Clause 11.5(a), the Borrower shall make up the amount of such
      insufficiency on demand from the Bank, but, without prejudice to its right
      to make such demand, the Bank may elect to make up the whole or any part
      of such insufficiency by increasing the amount of any transfer to be made
      in accordance with Clause 11.5(a)(ii) from the aggregate amount of such
      Earnings received in the next or subsequent
  months.

              

      

       

      
        	
                 
      

              	
                (c)

              	
                Until
      the occurrence of an Event of Default (or an event which, with the giving
      of notice and/or lapse of time or other applicable condition, might
      constitute an Event of Default), the Bank shall on each Repayment Date and
      on each due date for the payment of interest under this Agreement apply in
      accordance with the provisions of Clause 11.5 (a) the relevant part of the
      balance then standing to the credit of the Retention Account as shall be
      required to make payment of the Repayment Instalment specified in Clause
      4.1 then due under the terms of this Agreement or payment of interest then
      due under the terms of this Agreement and such transfer shall constitute a
      pro tanto satisfaction of the Borrower's obligations to pay such repayment
      instalment or interest (as the case may be) then due under this
      Agreement.

              

      

       

       

      
        
          
          

        

        
          51

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (d)

              	
                Any
      amounts for the time being standing to the credit of the Retention Account
      shall bear interest at the rate from time to time offered by the Bank to
      its customers for Dollar deposits of similar amounts and for periods
      similar to those for which such amounts are likely to remain standing to
      the credit of the Retention Account. Such interest shall, provided that
      the foregoing provisions of this Clause 11.5 shall have been complied with
      and provided that no Event of Default (or event which, with the giving of
      notice and/or lapse of time or other applicable condition, might
      constitute an Event of Default) shall have occurred, be released to the
      Borrower.

              

      

       

      
        	
                 
      

              	
                (e)

              	
                Nothing
      herein contained shall be deemed to affect the absolute obligation of the
      Borrowers to pay interest on and to repay the Loan as provided in Clauses
      3 and 4 or shall constitute a manner or postponement
    thereof.

              

      

       

      
        	
                 
      

              	
                (f)

              	
                The
      Borrower hereby irrevocably authorises the Bank to make from the Earnings
      Account any and all above payments and repayments as and when the same
      fall due or at any time thereafter.

              

      

       

      
        	
                 
      

              	
                (g)

              	
                The
      Borrower will comply with any written requirement of the Bank from time to
      time as to the location or re-location of the Earnings Account and the
      Retention Account (or either of them) and will from time to time enter
      into such documentation as the Bank may require in order to create or
      maintain in favour of the Bank an Encumbrance in the Earnings Account and
      the Retention Account, all at cost and expense of the
      Borrowers.

              

      

       

      
        	
                 
      

              	
                (h)

              	
                The
      Borrower hereby covenants with the Bank that the Earnings Account, the
      Retention Account and any moneys therein shall not be charged, assigned,
      transferred or pledged nor shall there be granted by the Borrower or
      suffered to arise any third party rights over or against the whole or any
      part of the Earnings Account other than in favour of the
    Bank.

              

      

       

      
        	
                 
      

              	
                (i)

              	
                The
      Earnings Account shall be operated in accordance with the Bank's usual
      terms and conditions (full knowledge of which the Borrower hereby
      acknowledges) and subject to the Bank's usual charges levied on such
      accounts and/or transactions conducted on such accounts (as from time to
      time notified by the Bank to the
Borrower).

              

      

       

      
        	
                 
      

              	
                (j)

              	
                The
      Borrower hereby warrants that sufficient monies to meet the next Repayment
      Instalment plus interest thereon will be accumulated each and every month
      in the Retention Account.

              

      

       

      
        	
                 
      

              	
                (k)

              	
                After
      the occurrence of an Event of Default the balance (if any) including any
      accrued interest standing to the credit of the Earnings Account and the
      Retention Account shall be applied in accordance with the provisions of
      Clause 11.3.

              

      

       

      
        	
                 
      

              	
                (1)

              	
                Upon
      payment in full of all principal, interest and all other amounts due to
      the Bank under the terms of this Agreement and the other Security
      Documents, any balance then standing to the credit of the Retention
      Account and/or the Earnings Account shall be released and paid to the
      Borrower or to whomsoever else may be entitled to receive such
      balance.

              

      

       

       

      
        
          
          

        

        
          52

          
            

          

        

        
          
          

        

      

       

      12.        UNLAWFULNESS, INCREASED
COSTS

       

      12.1      Unlawfulness

       

      If
any change in, or introduction of, any law, regulation or regulatory requirement
or any request of any central bank, monetary, regulatory or other authority or
any order of any court renders it unlawful or contrary to any such regulation,
requirement, request or order for the Bank to advance the Commitment or to
maintain or fund the Loan, notice shall be given promptly by the Bank to the
Borrower whereupon the Commitment shall be reduced to zero and the Borrower
shall be obliged to prepay the Loan in accordance with such notice, together
with accrued interest thereon to the date of prepayment and all other sums
payable by the Borrower under this Agreement.

       

      In
any such event the Borrower and the Bank shall (as per the provisions of
sub-Clause 3.6) negotiate in good faith (but without incurring any legal
obligations) with a view to agreeing the terms for making the Loan available
from another jurisdiction or providing the Loan from alternative
sources.

       

      12.2      Change of
circumstances

       

      If
any change in or in the interpretation of any applicable law or regulation, by
any government or governmental authority or agency, makes it unlawful for the
Bank to maintain or give effect to its obligations or to claim or receive any
amount payable to the Bank under this Agreement, then the Bank may serve written
notice on the Borrower declaring its obligations under this Agreement terminated
in whole or in part, whereupon the same shall terminate forthwith and the
Borrower will immediately repay the Loan and accrued interest to the date of
prepayment together with all other Outstanding Indebtedness to the Bank pursuant
to the terms of the notice.

       

      12.3      Increased
Cost

       

      If,
as a result of (a) any change in or in the interpretation of any law, regulation
or official directive (whether or not having the force of law but, if not having
the force of law, with which the Bank habitually complies) - including (without
limitation) those relating to Taxation, capital adequacy, liquidity, reserve
assets, cash ratio deposits and special deposits or those resulting from the
implementation of any amendment of the "1988 Basle convergence agreement" or any
amendatory or substitute agreement thereof- by any governmental authority in any
country the laws or regulations of which are applicable on the Bank, or (b)
compliance by the Bank with any request from any applicable fiscal or monetary
authority (whether or not having the force of law but, if not having the force
of law, with which the Bank habitually complies) or (c) any other set of
circumstances affecting the Bank:

       

      
        	
                 
      

              	
                (a)

              	
                the
      cost to the Bank of making the Commitment or any part thereof or
      maintaining or funding the Loan is increased or an additional cost on the
      Bank is imposed; and/or

              

      

       

      
        	
                 
      

              	
                (b)

              	
                subject
      the Bank to Taxes or the basis of Taxation (other than Taxes or Taxation
      on the overall net income of the Bank) in respect of any payments to the
      Bank under this Agreement or any of the other Security Documents is
      changed; and/or

              

      

       

      
        	
                 
      

              	
                (c)

              	
                the
      amount payable or the effective return to the Bank under any of the
      Security Documents is reduced;
and/or

              

      

       

       

      
        
          
          

        

        
          53

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (d)

              	
                the
      Bank's rate of return on its overall capital by reason of a change in the
      manner in which it is required to allocate capital resources to the Bank's
      obligations under any of the Security Document is reduced;
      and/or

              

      

       

      
        	
                 
      

              	
                (e)

              	
                require
      the Bank to make a payment or forgo a return on or calculated by
      references to any amount received or receivable by it under any of the
      Security Documents is required;
and/or

              

      

       

      
        	
                 
      

              	
                (f)

              	
                require
      the Bank to incur or sustain a loss (including a loss of future potential
      profits) by reason of being obliged to deduct all or part of the
      Commitment or the Loan from its capital for regulatory
      purposes,

              

      

       

      then
and in each case (subject to Clause 12.6) the Borrower shall pay to the Bank,
from time to time, upon demand, such additional moneys as shall indemnify the
Bank for any increased or additional cost, reduction, payment, foregone return
or loss whatsoever

       

      12.4      Claim for increased
cost

       

      The
Bank will promptly notify the Borrower of any intention to claim indemnification
pursuant to Clause 12.3 and such notification will be a conclusive and full
evidence binding on the Borrower as to the amount of any increased cost or
reduction and the method of calculating the same and the Borrower shall be
allowed to rebut such evidence by any means of evidence save for witness. A
claim under Clause 12.3 may be made at any time and must be discharged by the
Borrowers within fifteen (15) days of demand. It shall not be a defence to a
claim by the Bank under this Clause 12.3 that any increased cost or reduction
could have been avoided by the Bank. Any amount due from the Borrower under
Clause 12.3 shall be due as a separate debt and shall not be affected by
judgement being obtained for any other sums due under or in respect of this
Agreement.

       

      12.5      Option to
prepay

       

      If
any additional amounts are required to be paid by the Borrower to the Bank by
virtue of Clause 12.3, the Borrower shall be entitled, on giving the Bank not
less than fourteen (14) days prior notice in writing, to prepay the Loan and
accrued interest thereon, together with all other Outstanding Indebtedness, on
the next Repayment Date. Any such notice, once given, shall be
irrevocable.

       

      12.6      Exception

       

      Nothing
in Clause 12.3 shall entitle the Bank to receive any amount in respect of
compensation for any such liability to Taxes, increased or additional cost,
reduction, payment, foregone return or loss to the extent that the same is
subject of an additional payment under Clause 5.3.

       

      13.        ASSIGNMENT, PARTICIPATION,
LENDING BRANCH

       

      13.1      Binding
Effect

       

      This
Agreement shall be binding upon and inure to the benefit of the Bank and the
Borrower and their respective successors and permitted assigns.

       

      13.2      No Assignment by the
Borrower

       

      The
Borrower and any other parties to the Security Documents other than the Bank may
not assign or transfer any of its rights and/or obligations under this Agreement
or any of the other Security Documents or any documents executed pursuant to
this Agreement and/or the other Security Documents.

       

       

      
        
          
          

        

        
          54

          
            

          

        

        
          
          

        

      

       

      13.3      Assignment by the
Bank

       

      The
Bank may at any time (following consultation with the Borrower and on prior
thirty days notice being given to the Borrower and the other Security Parties
but without the consent of the Borrower), assign, transfer, or offer
participation to any other bank or financial institution, in whole or in part,
or in any manner dispose of all or any of its rights and/or obligations arising
or accruing under this Agreement or any of the other Security Documents or any
documents executed pursuant to this Agreement and/or the other Security
Documents. The expenses of any such assignment by the Bank shall be borne by the
Bank.

       

      13.4      Documentation

       

      If
the Bank assigns, transfers or in any other manner grants participation in
respect of all or any part of its rights or benefits or transfers all or any of
its obligations as provided in this Clause 13 the Borrower undertakes,
immediately on being requested to do so by the Bank, to enter into and procure
that each Security Party enters into such documents as may be necessary or
desirable to transfer to the assignee, transferee or participant all or the
relevant part of the interest of the Bank in the Security Documents and all
relevant references in this Agreement to the Bank shall thereafter be construed
as a reference to the Bank and/or assignee, transferee or participant of the
Bank to the extent of their respective interests and, in the case of a transfer
of all or part of the obligations of the Bank, the Borrower shall thereafter
look only to the assignee, transferee or participant in respect of that
proportion of the obligations of the Bank under this Agreement assumed by such
assignee, transferee or participant. The Borrower hereby expressly consents to
any subsequent transfer of the rights and obligations of the Bank and undertakes
that it shall join in and execute such supplemental or substitute agreements as
may be necessary to enable the Bank to assign and/or transfer and/or grant
participation in respect of its rights and obligations to another branch or to
one or more banks or financial institutions in a syndicate or
otherwise.

       

      13.5      Disclosure of
information

       

      The
Bank may with the consent of the Borrower (such consent not to be unreasonably
withheld) and the request for which shall be promptly responded to, disclose (on
a confidential basis) to a prospective assignee, substitute or transferee or to
any other person who may propose entering into contractual relations with the
Bank in relation to this Agreement such information about the Borrower and the
other Security Parties as the Bank shall consider appropriate.

       

      13.6      Change of Lending
Branch

       

      The
Bank shall be at liberty to transfer the Loan to any branch or branches, and
upon notification of any such transfer, the word "Bank" in this Agreement and
in the other Security Documents shall mean the Bank, acting through such branch
or branches and the terms and provisions of this Agreement and of the other
Security Documents shall be construed accordingly.

       

      14.        MISCELLANEOUS

       

      14.1      Cumulative
Remedies

       

       

      
        
          
          

        

        
          55

          
            

          

        

        
          
          

        

      

       

      The
rights and remedies of the Bank contained in this Agreement and the other
Security Documents are cumulative and not exclusive of each other nor of any
other rights or remedies conferred by law.

       

      14.2      Waivers

       

      No
failure, delay or omission by the Bank to exercise any right, remedy or power
vested in the Bank under this Agreement and/or the other Security Documents or
by law shall impair such right or power, or be construed as a waiver of, or as
an acquiescence in any default by the Borrower, nor shall any single or partial
exercise by the Bank of any power, right or remedy preclude any other or further
exercise thereof or the exercise of any other power, right or remedy. In the
event of the Bank on any occasion agreeing to waive any such right, remedy or
power, or consenting to any departure from the strict application of the
provisions of this Agreement or of any other Security Document, such waiver
shall not in any way prejudice or affect the powers conferred upon the Bank
under this Agreement and the other Security Documents or the right of the Bank
thereafter to act strictly in accordance with the terms of this Agreement and
the other Security Documents. No modification or waiver by the Bank of any
provision of this Agreement or of any of the other Security Documents nor any
consent by the Bank to any departure therefrom by any Security Party shall be
effective unless the same shall be in writing and then shall only be effective
in the specific case and for the specific purpose for which given. No notice to
or demand on any such party in any such case shall entitle such party to any
other or further notice or demand in similar or other
circumstances.

       

      14.3      Integration of
Terms

       

      This
Agreement contains the entire agreement of the parties and its provisions
supersede the provisions of the Commitment Letter (save for the provisions
thereof which relate to fees) any and all other prior correspondence and oral
negotiation by the parties in respect of the matters regulated by this
Agreement.

       

      14.4      Amendments

       

      This
Agreement and any other Security Documents shall not be amended or varied in
their respective terms by any oral agreement or representation or in any other
manner other than by an instrument in writing of even date herewith or
subsequent hereto executed by or on behalf of the parties hereto or
thereto.

       

      14.5      Invalidity of
Terms

       

      In
the event of any provision contained in one or more of this Agreement, the other
Security Documents and any other documents executed pursuant hereto or thereto
being invalid, illegal or unenforceable in any respect under any applicable law
in any jurisdiction whatsoever, such provision shall be ineffective as to that
jurisdiction only without affecting the remaining provisions hereof or thereof.
If, however, this event becomes known to the Bank prior to the drawdown of the
Commitment or of any part thereof the Bank shall be entitled to refuse drawdown
until this discrepancy is remedied. In case that the invalidity of a part
results in the invalidity of the whole Agreement, it is hereby agreed that there
will exist a separate obligation of the Borrower for the prompt payment to the
Bank of all the Outstanding Indebtedness. Where, however, the provisions of any
such applicable law may be waived, they are hereby waived by the parties hereto
to the full extent permitted by the law to the intent that this Agreement, the
other Security Documents and any other documents executed pursuant hereto or
thereto shall be deemed to be valid binding and enforceable in accordance with
their respective terms.

       

       

      
        
          
          

        

        
          56

          
            

          

        

        
          
          

        

      

       

      14.6      Inconsistency of
Terms

       

      In
the event of any inconsistency between the provisions of this Agreement and the
provisions of any other Security Document the provisions of this Agreement shall
prevail.

       

      14.7      Language and genuineness of
documents

       

      
        	
                 
      

              	
                (a)

              	
                Language

              

      

       

      All
certificates, instruments and other documents to be delivered under or supplied
in connection with this Agreement or any of the other Security Documents shall
be in the Greek or the English language or shall be accompanied by a certified
Greek translation upon which the Bank shall be entitled to rely.

       

      
        	
                 
      

              	
                (b)

              	
                Certification of
      documents

              

      

       

      Any
copies of documents delivered to the Bank shall be duly certified as true,
complete and accurate copies by appropriate authorities or legal counsel
practising in Greece or otherwise as will be acceptable to the Bank at the sole
discretion of the Bank.

       

      
        	
                 
      

              	
                (c)

              	
                Certification of
      signature

              

      

       

      Signatures
on Board or shareholder resolutions, Secretary's certificates and any other
documents are, at the discretion of the Bank, to be verified for their
genuineness by appropriate Consul or other competent authority.

       

      14.8      Further
assurances

       

      The
Borrower undertakes that the Security Documents shall both at the date of
execution and delivery thereof and so long as any moneys are owing under any of
the Security Documents be valid and binding obligations of the respective
parties thereto and enforceable in accordance with their respective terms and
that it will, at its expense, execute, sign, perfect and do, and will procure
the execution, signing, perfecting and doing by each of the other Security
Parties of, any and every such further assurance, document, act or thing as in
the reasonable opinion of the Bank may be necessary or desirable for perfecting
the security contemplated or constituted by the Security Documents.

       

      14.9      Conflicts

       

      In
the event of any conflict between this Agreement and any of the other Security
Documents, and the provisions of this Agreement shall prevail.

       

      15.        NOTICES AND OTHER
MATTERS

       

      15.1      Notices

       

      Every
notice, request, demand or other communication under the Agreement or, unless
otherwise provided therein, under any of the other Security Documents
shall:

       

      
        	
                 
      

              	
                (a)

              	
                be
      in writing delivered personally or be first-class prepaid letter (airmail
      if available), or shall be served through a process server or subject to
      Clause 10.7 by fax;

              

      

       

       

      
        
          
          

        

        
          57

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (b)

              	
                be
      deemed to have been received, subject as otherwise provided in this
      Agreement or the relevant Security Document, in the case of fax, at the
      time of dispatch as per transmission report (provided that if the date of
      despatch is not a business day in the country 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 or served
      personally or five (5) days after it has been put into the post;
      and

              

      

       

      
        	
                 
      

              	
                (c)

              	
                be
      sent:

              

      

       

      (i)         if
to be sent to the Borrower and any other Security Party, to:

       

       c/o
the Corporate Guarantor,

       1,
Vassilisis Sofias & Megalou Alexandrou street,

       151
24 Marousi, Greece,

       Fax
No.:+30 210 614 1273

       Attention:
the Chief Financial Officer

       

      (ii)         in
the case of the Bank at:

       

       EMPORIKI
BANK OF GREECE S.A.

       Shipping
Division,

       114
Kolokotroni Street,

       GR
185 35 Piraeus, Greece,

       Fax
No.: +30 210 4226779

       Attention
: The Manager

       

      or
to such other person, address or fax number as is notified by the relevant
Security Party or the Bank (as the case may be) to the other parties to this
Agreement and, in the case of any such change of address or fax number notified
to the Bank, the same shall not become effective until notice of such change is
actually received by the Bank and a copy of the notice of such change is signed
by the Bank.

       

      15.2      Confidentiality

       

      
        	
                 
      

              	
                (a)

              	
                Each
      of the parties hereto agrees and undertakes to keep confidential any
      documentation and any confidential information concerning the business,
      affairs, directors or employees of the other which comes into its
      possession in connection with this Agreement and not to use any such
      documentation, information for any purpose other than for which it was
      provided.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                The
      Borrower acknowledges and accepts that the Bank may be required by law,
      regulation or regulatory requirement or any request of any central bank or
      any court order to disclose information and deliver documentation relating
      to the Borrower and the transactions and matters in relation to this
      Agreement and/or the other Security Documents to governmental or
      regulatory agencies and
authorities.

              

      

       

      
        	
                 
      

              	
                (c)

              	
                The
      Borrower acknowledges and accepts that in case of occurrence of any of the
      Events of Default the Bank may disclose information and deliver
      documentation relating to the Borrower and the transactions and matters in
      relation to this Agreement and/or the other Security Documents to third
      parties to the extent that this is necessary for the enforcement or the
      contemplation of enforcement of the Bank's rights or for any other purpose
      for which in the opinion of the Bank, such disclosure would be useful or
      appropriate for the interests of the Bank or otherwise and the Borrower
      expressly authorises any such disclosure and
  delivery.

              

      

       

       

      
        
          
          

        

        
          58

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (d)

              	
                The
      Borrower acknowledges and accepts that the Bank may be prohibited from
      disclosing information to the Borrower by reason of law or duties of
      confidentiality owed or to be owed to other
  persons.

              

      

       

      
        	
                 
      

              	
                (e)

              	
                The
      Borrower shall be entitled to disclose information and deliver
      documentation relating to this Loan Agreement and the Security Documents
      to third parties including the Borrower's consultants and lawyers to the
      extent that it is necessary for the enforcement of the Borrower's rights
      or protection of Borrower's interests under the Loan
      Agreement.

              

      

       

      15.13    Process of personal
data

       

      The
Borrower hereby expressly gives its consent to the communication for process in
the meaning of law 2472/97 by the Bank of its personal data contained in this
Agreement, the Security Documents, in the Earnings Account and the Retention
Account for onwards communication thereof to an inter-banking database record
called "Teiresias" kept and solely used by banks and financial institutions.
Each of the Borrowers is entitled at any relevant time throughout the Security
Period to revoke its consent given hereunder by written notice addressed to the
Bank and the Registrar of "Teiresias A.E." at 2, Alamanas street, 15125
Maroussi, Athens, Greece.

       

      16.        APPLICABLE LAW AND
JURISDICTION

       

      16.1      Law

       

      This
Agreement shall be governed by and construed in accordance with Hellenic Law and
in particular with the provisions of (i) Act of the Monetary Committee under
Serial No. 187/1978 (as amended), (ii) the provisions of L.D. dated
17.7/13.8.1923 on "Special Provisions on Societes Anonymes" and (iii) the
special terms set out in the resolutions of the Bank of Greece or any other
competent Authority. Moreover, the Borrower hereby acknowledges and declares
that it is fully familiar with the General Transaction Terms of the Bank and it
is hereby agreed that the said General Transaction Terms shall be deemed an
integral part of this Agreement.

       

      16.2      Submission to
Jurisdiction

       

      
        	
                 
      

              	
                (a)

              	
                For
      the exclusive benefit of the Bank, the Borrower hereby (i) irrevocably
      submits to the non exclusive jurisdiction of the Courts of Piraeus in
      Greece and (ii) agrees that any summons, writ, judicial or extra-judicial
      notice, protest, payment order, order for payment, order for enforcement,
      announcement of claim or other legal process issued against it in Greece
      shall be served upon the Process Agent, who is hereby authorised to accept
      such service, which shall be deemed to be good service on the
      Borrower.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                The
      submission to the jurisdiction of the Courts of Piraeus shall not (and
      shall not be construed so as to) limit the right of the Bank to take
      proceedings against the Borrower in the courts of any other jurisdiction
      nor shall the taking of proceedings in any one or more jurisdictions
      preclude the taking of proceedings in any other jurisdiction, whether
      concurrently or not.

              

      

       

      
        	
                 
      

              	
                (c)

              	
                The
      parties further agree that subject to sub-Clause 16.2(b) the Courts of
      Piraeus shall have exclusive jurisdiction to determine any claim which the
      Borrower may have against the Bank arising out of or in connection with
      this Agreement and the Borrower hereby waives any objections to
      proceedings with respect to this Agreement in such courts on the grounds
      of venue or inconvenient forum.

              

      

       

       

      
        
          
          

        

        
          59

          
            

          

        

        
          
          

        

      

       

      16.3      Process
Agent

       

      Mr.
George Economou an attorney-at-law whose present address is at 11 Kanari Street,
Athens, Greece, is hereby appointed by the Borrower as agent to accept service
(hereinafter "Process Agent")
upon whom any judicial process in respect of proceedings in Greece may be
served and any process notice, judicial or extra-judicial request, demand for
payment, payment order, foreclosure proceedings, notarial announcement of claim,
notice, request, demand or other communication under this Agreement or any of
the Security Documents. In the event that the Process Agent (or any substitute
process agent notified to the Bank in accordance with the foregoing) cannot be
found at the address specified above (or, as the case may be, notified to the
Bank), which will be conclusively proved by a deed of a process server to the
effect that the Process Agent was not found at such address, any process notice,
judicial or extra-judicial request, demand for payment, payment order,
foreclosure proceedings, notarial announcement of claim or other communication
to be sent to any Security Party may be validly notified in accordance with the
relevant provisions of the Hellenic Code on Civil Procedure.

       

      
        	
                16.4

              	
                In
      this Clause 16 "proceedings" means
      proceedings of any kind, including an application for a provisional or
      protective measure.

              

      

       

      
        
           

        

        
          60

          
            

          

        

        
           

        

      

      SCHEDULE
1

       

      FORM
OF DRAWDOWN NOTICE

       

      (referred
to in Clause 2.2)

       

      To:        EMPORIKI BANK OF GREECE
S.A.

      144
Kolokotroni street.

      GR
185.35 Piraeus

      Greece

      (the
"Bank")

      [ • ] March, 2008

      

      
        Re:
US$ 50,000,000 - Loan Agreement No.      /2008
dated         March, 2008 made between
(A) JAPAN I SHIPPING COMPANY LIMITED (the "Borrower") and (B) the Bank
(the "Loan
Agreement")

      

      

      We
refer to the Loan Agreement and hereby give you notice that we wish to draw the
Commitment in the amount of US$50,000,000 (Dollars fifty million) on [•] March
2008. We select a first Interest Period in respect of the Loan of [ • ] months.
The funds should be credited to ([ • ] [ • ] [name and number of account] [• ]) with [ • ]

      

      We
confirm that:

      

      
        	
                (a)

              	
                no
      event or circumstance has occurred and is continuing which constitutes a
      Default;

              

      

       

      
        	
                (b)

              	
                the
      representations and warranties contained in Clause 6 of the Loan Agreement
      and the representations and warranties contained in each of the other
      Security Documents are true and correct at the date hereof as if made with
      respect to the facts and circumstances existing at such
    date;

              

      

       

      
        	
                (c)

              	
                the
      borrowing to be effected by the drawing down of the Commitment will be
      within our corporate powers, has been validly authorised by appropriate
      corporate action and will not cause any limit on our borrowings (whether
      imposed by statute, regulation, agreement or otherwise) to be exceeded;
      and

              

      

       

      
        	
                (d)

              	
                to
      the best of our knowledge and belief there has been no material adverse
      change in our financial position or in the consolidated financial position
      of ourselves and the other Security Parties from that described by us to
      the Bank in the negotiation of the Loan
  Agreement.

              

      

       

      Words
and expressions defined in the Loan Agreement shall have the same meanings when
used herein.

      

      
        
          	
                  SIGNED
      by

                	
                  )

                
	
                  Mr.

                	
                  )

                
	
                  for
      and on behalf of

                	
                  )

                
	
                  JAPAN
      I SHIPPING COMPANY LIMITED

                	
                  )

                
	
                  of
      Liberia

                	
                  )

                
	
                  in
      the presence of:

                	
                  )

                

        

      

      

      
        
           

        

        
          61

          
            

          

        

        
           

        

      

      

      SCHEDULE
2

      

      INSURANCE
REQUIREMENTS

       

      This
Schedule is an integral part of the Agreement to which it is
attached.

       

      1.          DEFINITIONS

      

      
        	
                1.1

              	
                Words
      and expressions used in this Schedule shall have the meanings given
      thereto in the agreement to which this Schedule is attached and the
      following expressions shall have the meanings listed
  below:

              

      

       

      "Approved Brokers" means such
firm of insurance brokers, appointed by the Owner, as may from time to time be
approved by the Bank in writing for the purposes of this Schedule;

       

      "Excess risks" means the
proportion (if any) of claims for general average, salvage and salvage charges
and under the ordinary collision clause not recoverable in consequence of the
value at which a vessel is assessed for the purpose of such claims exceeding its
insured value;

       

      "Insurance Requirements" means
all the terms and conditions in this Schedule or any other provision concerning
Insurances in any other Clause of the agreement to which this Schedule is
attached and all such terms and conditions are an integral part of the agreement
to which they are attached;

       

      "Insurances" in respect of a
vessel means all policies and contracts of insurance (including, without
limitation, all entries of such vessel in a protection and indemnity, war risks
or other mutual insurance association) which are from time to time in place or
taken out or entered into by or for the benefit of the Owner owning such vessel
(whether in the sole name of its Owner or in the joint names of its Owner and
the Bank) in respect of such vessel and its earnings or otherwise howsoever in
connection with such vessel and all benefits of such policies and/or contracts
(including all claims of whatsoever nature and return of premiums);

       

      "Loss Payable Clauses" means
the provisions regulating the manner of payment of sums receivable under the
Insurances which are to be incorporated in the relevant insurance document, such
Loss Payable Clauses to be in the forms set out in paragraph 4 of this Schedule,
or such other form as the Bank may from time to time agree in
writing;

       

      "Owner" means the owner of a
vessel which should be insured and be maintained insured pursuant to these
Insurance Requirements in accordance with any agreement to which these Insurance
Requirements are attached;

       

      "Protection and Indemnity Risks"
means the usual risks covered by an English protection and indemnity
association including the proportion (if any) not recoverable in the case of
collision under the ordinary collision clause; and

       

      "War risks" includes the risk
of mines and all risks excluded from the standard form of English marine policy
by the free of capture and seizure clause.

       

      2.          INSURANCES TO BE EFFECTED
AND MAINTAINED

      

      
        	
                2.1

              	
                The
      insurance which must be effected and maintained in accordance with the
      provisions of the agreement to which these Insurance Requirements are
      attached should be in the name of the Owner and as
  follows:

              

      

       

       

      
        
          
          

        

        
          62

          
            

          

        

        
          
          

        

      

       

      
        
          	
                   
      

                	
                  (a)

                	
                  Hull and
      Machinery

                
	 	 	 
	 	 	insurance
      against fire and usual marine risks on an agreed value basis, on a full
      cover/all risks basis according to English or American Hull Clauses with a
      reasonable deductible and upon such terms as shall from time to time be
      approved in writing by the Bank;
and

        

      

       

      
        
          	
                   
      

                	
                  (b)

                	
                  War Risks
      Insurance

                
	 	 	 
	 	 	insurance
      against War risks according to the London Institute War Clauses, on an
      agreed value basis attaching also the so called war protection clauses. In
      this case crew war liabilities insurance shall also have to be effected
      separately; and

        

      

       

      
        
          	
                   
      

                	
                  (c)

                	
                  Increased
      Value

                
	 	 	 
	 	 	increased
      Value insurance (Total Loss only, including Excess Liabilities) as per the
      applicable English or American Institute Clauses (Disbursement/Increased
      Value/ Excess Liabilities) up to an amount not exceeding the Insurance
      Amount specified in Clause 3.3 below;
and

        

      

       

      
        
          	
                   
      

                	
                  (d)

                	
                  Protection and
      Indemnity

                
	 	 	 
	 	 	insurance
      against protection and indemnity risks for the full value and tonnage of
      the vessel insured (as approved in writing by the Bank) according to the
      relevant rules and deductibles provided thereof for all risks including
      Pollution (and if the vessel is passenger ship including liability towards
      third parties which is not covered by the War Risk Insurance) insured by
      P+I Clubs, members of the International Group of Protection and Indemnity
      Associations. If any risks are excluded or the deductibles as provided by
      the rules have been altered, the written consent of the Bank shall have to
      be previously required. In case that crew liabilities (including without
      limitation loss of life, injury or illness) have been entirely excluded
      from the association cover or insured on a deductible excess basis,
      (always subject to the prior written consent of the Bank) such liabilities
      shall have to be further insured separately with other underwriters
      acceptable to the Bank and upon such terms as shall from time to time be
      approved in writing by the Bank;
and

        

      

       

      
        
          	
                   
      

                	
                  (e)

                	
                  FD & D
      Insurance

                
	 	 	 
	 	 	(If
      so required by the Bank, at its absolute discretion, at any time
      throughout the Security Period) Freight, Demurrage and Defence insurance
      as per the terms and conditions of a mutual club or association acceptable
      to the Bank; and

        

      

       

      
        
          	
                   
      

                	
                  (f)

                	
                  Pollution Liability
      Insurance

                
	 	 	 
	 	 	an
      extra insurance in respect of excess Oil Pollution Liability (including
      -if the vessel insured is a tanker- the Civil Liability Convention
      certificate) including full cover of pollution risks for the amount up to
      the maximum commercially available limit and upon such terms as shall be
      commercially available and accepted by the Bank;
  and 

        

      

       

      
        
          	
                   
      

                	
                  (g)

                	
                  USA Pollution Risk
      Insurance

                
	 	 	 
	 	 	(in
      case that the vessel is scheduled to operate within or nearby USA
      jurisdiction) to cover and keep such vessel covered with an extra
      insurance in respect of oil pollution liability for an amount and upon
      such terms as required by international and national law regulations and
      shall from time to time be required by the Bank;
  and 

        

      

       

       

       

       

      
        
          
          

        

        
          63

          
            

          

        

        
          
          

        

      

       

      
        
          	
                   
      

                	
                  (h)

                	
                  Mortgagee's Interest
      Insurance

                
	 	 	 
	 	 	Mortgagee's
      Interest Insurance which shall be effected by the Bank in its name but at
      the expense of the Borrower and in an amount equal to 115% of the amount
      of the Loan including Mortgagee's asset protection (pollution) cover or
      other similar insurance in respect of any pollution claims against the
      Vessel under the so called "German wording" for 360 days or upon such
      terms as shall from time to time be determined by the Bank;
      and 

        

      

       

      
        
          	
                   
      

                	
                  (i)

                	
                  Other
      Insurance

                
	 	 	 
	 	 	insurance
      in respect of such other matters of whatsoever nature and howsoever
      arising in respect of which the Bank would at any time require at its
      discretion the vessel to be
insured.

        

      

       

      
        	
                3.

              	
                TERMS
      AND OBLIGATIONS FOR EFFECTING AND MAINTAINING
      INSURANCES

              

      

       

      
        	
                3.1

              	
                The
      Insurances to be effected in such currency as the Bank may approve and
      through the Approved Brokers (other than the mortgagee's interest
      insurance which shall be effected through brokers nominated by the Bank)
      and with such insurance companies and/or underwriters as shall from time
      to time be approved in writing by the Bank, provided however that the
      insurances against war risks, protection and indemnity, FD & D cover
      or other mutual insurance risks may be effected by the entry of the vessel
      with such war, protection and indemnity or other mutual insurance
      associations as shall from time to time be approved in writing by the
      Bank.

              

      

       

      
        	
                3.2

              	
                The
      Insurances to be effected and maintained free of cost and expense to the
      Bank and in the sole name of the Owner or, if so required by the Bank, in
      the joint names of the Owner and the Bank (but without liability on the
      part of the Bank for premiums or calls). All insurances to be in form and
      substance and under terms satisfactory to the Bank and with insurers
      acceptable to the Bank.

              

      

       

      
        	
                3.3

              	
                Unless
      otherwise agreed in writing by the
Bank:

              

      

       

      
        	
                 
      

              	
                (a)

              	
                The
      amount in respect of which the Insurances should be effected shall be an
      amount (Insurance Amount) which will be (aa) in respect of Hull and
      Machinery Insurance the greater of the market value of the vessel insured
      for the time being and 130% of an amount (the "Amount of Debt") equal to
      (i) the Loan if the agreement to which these Insurance Requirements are
      attached is a Loan Agreement or (ii) the Maximum Limit of the Facility if
      the agreement to which these Insurance Requirements are attached is an
      Overdraft Facility or a Facility for Issue of Guarantees or Letters of
      Credit; and (bb) in respect of Mortgagee's Interest Insurance 110% of the
      Amount of Debt.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                In
      case that the Amount of Debt is secured by more than one vessel the above
      percentages should be covered by the aggregate of the Insurances in
      respect of all such vessels.

              

      

       

      
        	
                 
      

              	
                (c)

              	
                In
      case that the vessel insured secures by its Insurances Amounts of Debt
      under more than one agreement then the above percentages apply to the
      aggregate of all the Amounts of Debt under all the
    agreements.

              

      

       

       

      
        
          
          

        

        
          64

          
            

          

        

        
          
          

        

      

       

      
        	
                3.4

              	
                Any
      person which is obliged under the agreement to which these Insurance
      Requirements are attached to effect and maintain the Insurances, it will
      be obliged and it hereby undertakes, jointly and severally with any other
      person having the same obligation to (and will ensure that the Owner, if
      it is a different person shall):

              

      

       

      
        	
                 
      

              	
                (a)

              	
                procure
      and ensure that the Approved Brokers and/or the Club Managers, as the case
      may be, shall send to the Bank a letter of undertaking in respect of the
      Insurances in form and substance satisfactory to the Bank and Notice of
      Cancellation as per Clause 4(d) below. The Approved Brokers' Letter of
      Undertaking shall be compatible with the form recommended by Lloyd's
      Insurance Brokers Committee, or any subsequent LIBC form. Such brokers to
      further undertake to give immediate notice of any insurance being subject
      to the Condition Survey Warranty (J.H.II5) and/or Structural Conditions
      Warranty (J.H.722) and/or the Classification Clause (Hulls) 29/6/89, 30
      days prior to the attachment date of any insurance bearing any of these
      warranties.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                (if
      any of the Insurances form part of a fleet cover), procure that the
      Approved Brokers shall undertake to the Bank that they shall neither set
      off against any claims in respect of the vessel insured any premiums due
      in respect of other vessels under such fleet cover or any premiums due for
      other insurances, nor cancel the insurance for reasons of non-payment of
      premiums for other vessels under such fleet cover or of premiums for such
      other insurances, and shall undertake to issue a separate policy in
      respect of the vessel insured if and when so requested by the
      Bank;

              

      

       

      
        	
                 
      

              	
                (c)

              	
                punctually
      pay all premiums, calls, contributions or other sums payable in respect of
      all Insurances and produce all relevant receipts or other evidence of
      payment when so required by the
Bank;

              

      

       

      
        	
                 
      

              	
                (d)

              	
                at
      least fourteen (14) days before the Insurances expire, notify the Bank of
      the names of the brokers and/or the war risks and protection and indemnity
      risks associations proposed to be employed by the Owner for the purposes
      of the renewal of such Insurances and of the amounts in which such
      Insurances are proposed to be renewed and the risks to be covered and,
      subject to compliance with any requirements of the Bank under the
      Insurance Requirements, procure that appropriate instructions for the
      renewal of such Insurances on the terms so specified are given to the
      Approved Brokers and/or to the approved war risks and protection and
      indemnity risks associations at least ten (10) days before the relevant
      Insurances expire, and that the Approved Brokers and/or the approved war
      risks and protection and indemnity risks associations will at least seven
      (7) days before such expiry (or within such shorter period as the Bank may
      from time to time agree) confirm in writing to the Bank as and when such
      renewals have been effected in accordance with the instructions so
      given;

              

      

       

      
        	
                 
      

              	
                (e)

              	
                arrange
      for the execution and delivery of such guarantees or indemnities as may
      from time to time be required by any protection and indemnity or war risks
      association;

              

      

       

      
        	
                 
      

              	
                (f)

              	
                deposit
      with the Approved Brokers (or procure the deposit of) all slips, cover
      notes, policies, certificates of entry or other instruments of insurance
      from time to time issued and procure that the interest of the Bank shall
      be endorsed thereon by incorporation of the relevant Loss Payable Clause
      and by means of a notice of assignment (signed by the Owner) in the form
      set out in Paragraph 4 of this Schedule or in such other form as may from
      time to time be agreed in writing by the Bank, and that the Bank shall be
      furnished with pro forma copies thereof and a letter or letters of
      undertaking from the Approved Brokers in such form as shall from time to
      time be required by the Bank;

              

      

       

       

      
        
          
          

        

        
          65

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (g)

              	
                procure
      that any protection and indemnity and/or war risks associations and/or
      Hull and Machinery and/or any other insurance company or underwriters in
      which the vessel insured is for the time being entered and/or insured
      shall endorse the relevant Loss Payable Clause on the relevant certificate
      of entry or policy and shall furnish the Bank with a copy of such
      certificate of entry or policy and a letter or letters of undertaking in
      such form as shall from time to time be required by the
    Bank;

              

      

       

      
        	
                 
      

              	
                (h)

              	
                (if
      so requested by the Bank, but at the cost of the Owner) furnish the Bank
      from time to time with a detailed report signed by an independent firm of
      marine insurance brokers appointed by the Bank dealing with the Insurances
      maintained on the vessel insured and stating the opinion of such firm as
      to the adequacy thereof;

              

      

       

      
        	
                 
      

              	
                (i)

              	
                do
      all things necessary and provide all documents, evidence and information
      to enable the Bank to collect or recover any moneys which shall at any
      time become due in respect of the
Insurances;

              

      

       

      
        	
                 
      

              	
                (j)

              	
                ensure
      that the vessel insured shall not be employed otherwise than in conformity
      with the terms of the Insurances (including any warranties express or
      implied therein) without first obtaining the consent of the insurers to
      such employment and complying with such requirements as to extra premium
      or otherwise as the insurers may
prescribe;

              

      

       

      
        	
                 
      

              	
                (k)

              	
                apply
      all sums receivable under the Insurances which are paid to the Owner in
      accordance with the Loss Payable Clauses in repairing all damage and/or in
      discharging the liability in respect of which such sums shall have been
      received; and

              

      

       

      
        	
                      (1)

              	
                (in
      case that the vessel is scheduled to operate or operates within or nearby
      USA jurisdiction) make all the Protection & Indemnity Club US Voyage
      Quarterly Declarations for each quarter in time and send copies of same to
      the Bank.

              

      

       

      
        	
                        (m) 
      

              	
                 Fleet
      Cover is permitted only subject to the prior written approval of the Bank,
      to the conditions set out in 3.4(b) above and the Bank's prior express
      written approval of fleet aggregate
deductibles.

              

      

       

      
        	
                4.

              	
                LOSS PAYABLE CLAUSES
      AND CANCELLATION CLAUSE

              

      

       

      The
Loss Payable Clauses to be attached to the relevant Insurances should be
substantially in the following form:

       

      (A)    Hull and Machinery (Marine
and War Risks)

       

      It
is noted that by a Deed of General Assignment and a first priority
statutory ____________ ship
Mortgage and a Deed of covenant supplemental thereto, both dated
___________________, 2008     granted
by ____________ of
____________ (the "Owner") in favour of EMPORIKI BANK OF GREECE
S.A., acting through its
office at 114 Kolokotroni Street, Piraeus, Greece (the "Mortgagee") all the
Owner's rights, title and interest in and to all policies and contracts of
insurance from time to time taken out or entered into by or for the benefit of
the Owner including all claims of whatsoever nature and return or premia in
respect of
the ____________ flag m/v, "____________" and
accordingly:

       

      
        
          
          

        

        
          66

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (a)

              	
                all
      claims hereunder in respect of an actual or constructive or compromised or
      arranged total loss, and all claims in respect of a major casualty (that
      is to say any casualty the claim in respect of which exceeds the Major
      Casualty Amount inclusive of any deductible shall be paid in full to the
      Mortgagee or to its order; and

                 

              

      

      
        	
                 
      

              	
                (b)

              	
                all
      other claims hereunder shall be paid in full to the Owner or to its order,
      unless and until the Mortgagee shall have notified the insurers hereunder
      to the contrary, whereupon all such claims shall be paid to the Mortgagee
      or to its order.

                 

              

      

      (B)            Protection and Indemnity
Risks

       

      Payment
of any recovery which  ____________, of ____________ (the
"Owner") is entitled to make out of the funds of the Association in respect of
any liability, costs or expenses incurred by the Owner, shall be made to the
Owner or to its order, unless and until the Association receives notice to the
contrary from EMPORIKI BANK OF
GREECE S.A., acting through its office at 114 Kolokotroni Street,
Piraeus, Greece (the "Mortgagee") in which event all recoveries shall thereafter
be paid to the Mortgagee or to its order; provided that no liability whatsoever
shall attach to the Association, its managers or its agents for failure to
comply with the latter obligation until the expiry of two clear business days
from the receipt of such notice.

       

      
        	
                4.2

              	
                Notice
      of Cancellation

                 

              

      

      The
Owner to procure that Notice of Cancellation of Insurances be given to the
Mortgagee along the following terms:

       

      Notice
of Cancellation of Insurances will be given to EMPORIKI BANK OF GREECE S.A.,
acting through its office at 114 Kolokotroni Street, Piraeus, Greece (the
"Mortgagee") in any of the following cases:

       

      
        	
                 
      

              	
                (a)

              	
                immediately
      of any material changes which are proposed to be made in the terms of the
      Insurances or if the insurers cease to be insurers for any purposes
      connected with the Insurances;

                 

              

      

      
        	
                 
      

              	
                (b)

              	
                not
      later than fourteen (14) days prior to the expiry of any of the Insurances
      if instructions have not been received for the renewal thereof and, in the
      event of instructions being received to renew, of the details
      thereof;

                 

              

      

      
        	
                 
      

              	
                (c)

              	
                immediately
      of any instructions or notices received by insurers with regard to the
      cancellation or invalidity of any of the Insurances aforesaid;
      and

                 

              

      

      
        	
                 
      

              	
                (d)

              	
                immediately
      if the insurers give notice of their intention to cancel the Insurances,
      provided that the insurers will not exercise any rights of cancellation by
      reason of unpaid premiums without giving the Bank fourteen (14) days, from
      the receipt of such notice in which to remit the sums
      due.

                 

              

      

       

      
        
          	
                  4.3

                	
                  Notice
      of Assignment

                   

                

        

      

      The
Notice of Assignment shall be in the following form:

       

      Form of Notice of Assignment
— First Mortgage

       

      (for
attachment by way of endorsement to the Policy)

       

      
        
          
          

        

        
          67

          
            

          

        

        
          
          

        

      

       

      
        ____________,
of ____________ (the "Owner") the owner of the m/v "____________" registered
under ____________ flag, the ("Vessel") HEREBY GIVE NOTICE that by a Deed of
General Assignment made the ___ day of ____________, 2008 and entered into by us
with EMPORIKI BANK OF GREECE
S.A., acting through its
office at 114 Kolokotroni Street, Piraeus, Greece (the "Mortgagee") there has
been assigned by us to the Mortgagee, as first Mortgagee and
first assignee
of the Vessel all rights, title and interest in and to all policies and
contracts of insurance from time to time taken out or entered into by or for the
benefit of the Owner, all insurances in respect thereof, including the
insurances constituted by the Policy whereon this notice is endorsed and the
Owner has authorised the Mortgage to have access and/or obtain any copies of the
Policy(ies), certificate(s) of entry and/or other information from the
insurers.

         

        Dated ____________, 2008

         

        For and on behalf of

         

        The Owner

         

        By: __________________

         

        Attorney-in-fact

      

      
        
           

        

        
          68

          
            

          

        

        
           

        

      

      SCHEDULE
3

       

      FORM
OF COMPLIANCE CERTIFICATE

      (referred
to in Clause 8.2(d))

       

      To:
EMPORIKI BANK OF GREECE
S.A.

       

      From:
TOP SHIPS INC. (the
"Corporate Guarantor")
and

       

      (the
"Borrower")

       

      Dated:
[•]

      Re: US$50,000,000 - Loan
Agreement dated [•] March, 2008 (the "Loan
Agreement")

       

      Terms
defined in the Loan Agreement shall have the same meaning when used
herein.

       

      
        We
[•] and [•], each being a director of the Corporate Guarantor, refer to Clause
8.2(iv) of the Loan Agreement and hereby certify that, as at [insert date of
accounts] and on the date hereof;

         

      

      1.          Financial
Covenants:

       

      
        	
                 
      

              	
                (a)

              	
                the
      Corporate Guarantor's Corporate Leverage ratio in relation to financial
      period 31.01. [•] to 31.12. [•], during such period is [•];

                 

              

      

      
        	
                 
      

              	
                (b)

              	
                the
      Guarantor's minimum Corporate Liquidity is, in relation to the said
      financial period, in excess of USD [•] (say United States Dollars
      [•])

                 

              

      

      2.          Default

       

      [No
Default has occurred and is continuing] 

       

      or

       

      [The
following Default has occurred and in continuing: [provide details of Default].
[The following steps are being taken to remedy it: [provide
details of steps being taken to remedy Default]].

       

       

       

      
        Signed:  ________________________            Signed:
________________________

        Director                               Director

         

        
 

         

      

       

      
        
          
          

        

        
          69

          
            

          

        

        
          
          

        

      

      SIGNATURE
PAGE

       

      
        IN
WITNESS whereof the parties hereto have caused this Agreement to be duly
executed on the date first above written.

         

        
          

          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                	
                                                                        SIGNED
      by

                                                                      	
                                                                        )

                                                                      	 
      
	
                                                                        Mrs.
      Eirini Alexandropoulou

                                                                      	
                                                                        )

                                                                      	 
      
	
                                                                        for
      and on behalf of

                                                                      	
                                                                        )

                                                                      	 
      
	
                                                                        JAPAN
      I SHIPPING COMPANY LIMITED

                                                                      	
                                                                        )

                                                                      	   
      /s/ Eirini
      Alexandropoulou
	
                                                                        of
      Liberia, in the presence of: 

                                                                      	
                                                                        )

                                                                      	    Attorney-in-Fact 
      
	
                                                                         

                                                                      	
                                                                         

                                                                      	
                                                                         

                                                                      
	 /s/
      Angela Arcadis	
                                                                         

                                                                      	
                                                                         

                                                                      	 
      
	Witness: 	 	 	 
	Name: 
      Angela Arcadis 	 	 	 
	Address: 13,
      Defteras Merarchias Street	 	 	 
	      Pireas,
      Greece 	 	 	 
	Occupation:
      Attorney-at-law 	 	 	 
	
                                                                         

                                                                      	
                                                                         

                                                                      	 
      
	
                                                                         

                                                                      	
                                                                         

                                                                      	 
      

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

          

            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                
                                                                  
                                                                    
                                                                      
                                                                        
                                                                          
                                                                            
                                                                              	
                                                                                      SIGNED
      by

                                                                                    	
                                                                                      )

                                                                                    	 
      
	
                                                                                      Mr.
      Serafeim Kriempardis and

                                                                                    	
                                                                                      )

                                                                                    	 
       /s/ Serafeim
      Kriempardis
	Mrs.
      Christina Margelou 	) 	     Attorney-in-fact
	
                                                                                      for
      and on behalf of

                                                                                    	
                                                                                      )

                                                                                    	 
      
	
                                                                                      EMPORIKI
      BANK OF GREECE S.A.

                                                                                    	
                                                                                      )

                                                                                    	  
       /s/ Christina
      Margelou
	
                                                                                      in
      the presence of: 

                                                                                    	
                                                                                      )

                                                                                    	    Attorney-in-Fact 
      
	
                                                                                       

                                                                                    	
                                                                                       

                                                                                    	
                                                                                       

                                                                                    
	 /s/
      Angela Arcadis	
                                                                                       

                                                                                    	
                                                                                       

                                                                                    	 
      
	Witness: 	 	 	 
	Name: 
      Angela Arcadis 	 	 	 
	Address: 13,
      Defteras Merarchias Street	 	 	 
	              
      Pireas, Greece 	 	 
	Occupation:
      Attorney-at-law 	 	 	 
	
                                                                                       

                                                                                    	
                                                                                       

                                                                                    	 
      
	
                                                                                       

                                                                                    	
                                                                                       

                                                                                    	 
      

                                                                            

                                                                          

                                                                        

                                                                      

                                                                    

                                                                  

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

             

            

            SK 23116 0005
1007473

          

        

      

      
        
          
             

          

          
            70

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00160-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00160-of-00352.parquet"}]]