Document:

DATED
    20
November     2008

      

      KRONOS
SHIPPING I, LTD.

      as
Borrower

      

      - and
-

      

      DEUTSCHE
SCHIFFSBANK AKTIENGESELLSCHAFT

      as
Lender

      

      
        
          

        

         

      

      LOAN
AGREEMENT

       

      
        

      

      
 

      relating
to a pre- and post-delivery loan facility of

      up to
$30,000,000 to assist the finance,

      construction
and acquisition of hull number

      MD2007-11-12
at Nantong Mingde Heavy Industry Stock Co., Ltd.

      and a
related guarantee facility of up to $16,320,000

      

      /Holman
fenwick willan logo/

      
        
           

        

        
          
          

          
            

          

        

        
           

        

      

      INDEX

      

      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                
                                                                  
                                                                    
                                                                      	
                                                                              1.

                                                                            	
                                                                              DEFINITIONS AND
      INTERPRETATION

                                                                            	
                                                                               
      1

                                                                            
	
                                                                              2.

                                                                            	
                                                                              THE LOAN

                                                                            	
                                                                               
      10

                                                                            
	
                                                                              3.

                                                                            	
                                                                              DRAWDOWN

                                                                            	
                                                                               
      11

                                                                            
	
                                                                              4.

                                                                            	
                                                                              GUARANTEE
      FACILITY

                                                                            	
                                                                               
      12

                                                                            
	
                                                                              5.

                                                                            	
                                                                              REPAYMENT

                                                                            	
                                                                               
      14

                                                                            
	
                                                                              6.

                                                                            	
                                                                              PREPAYMENT

                                                                            	
                                                                               
      15

                                                                            
	
                                                                              7.

                                                                            	
                                                                              INTEREST
      PERIODS

                                                                            	
                                                                               
      16

                                                                            
	
                                                                              8.

                                                                            	
                                                                              INTEREST AND DEFAULT
      INTEREST

                                                                            	
                                                                               
      17

                                                                            
	
                                                                              9.

                                                                            	
                                                                              PAYMENTS

                                                                            	
                                                                               
      18

                                                                            
	
                                                                              10.

                                                                            	
                                                                              NO SET-OFF, COUNTERCLAIM OR TAX
      DEDUCTION

                                                                            	
                                                                               
      19

                                                                            
	
                                                                              11.

                                                                            	
                                                                              ACCOUNTS OF THE
      LENDER

                                                                            	
                                                                               
      20

                                                                            
	
                                                                              12.

                                                                            	
                                                                              APPLICATION OF
      RECEIPTS

                                                                            	
                                                                               
      20

                                                                            
	
                                                                              13.

                                                                            	
                                                                              RETENTIONS

                                                                            	
                                                                               
      20

                                                                            
	
                                                                              14.

                                                                            	
                                                                              CONDITIONS
      PRECEDENT

                                                                            	
                                                                               
      22

                                                                            
	
                                                                              15.

                                                                            	
                                                                              SECURITY

                                                                            	
                                                                               23
      

                                                                            
	
                                                                              16.

                                                                            	
                                                                              REPRESENTATIONS AND
      WARRANTIES

                                                                            	
                                                                               24
      

                                                                            
	
                                                                              17.

                                                                            	
                                                                              UNDERTAKINGS OF THE
      BORROWER

                                                                            	
                                                                               28
      

                                                                            
	
                                                                              18.

                                                                            	
                                                                              REVIEW OF
      INSURANCES

                                                                            	
                                                                               
      32

                                                                            
	
                                                                              19.

                                                                            	
                                                                              VALUATIONS AND ASSET
      PROTECTION

                                                                            	
                                                                               
      32

                                                                            
	
                                                                              20.

                                                                            	
                                                                              EVENTS OF
      DEFAULT

                                                                            	
                                                                               
      34

                                                                            
	
                                                                              21.

                                                                            	
                                                                              FEES, EXPENSES AND
      INDEMNITIES

                                                                            	
                                                                               37
      

                                                                            
	
                                                                              22.

                                                                            	
                                                                              CHANGES IN
      CIRCUMSTANCES

                                                                            	
                                                                               
      40

                                                                            
	
                                                                              23.

                                                                            	
                                                                              INCREASED
      COST

                                                                            	
                                                                               
      42

                                                                            
	
                                                                              24.

                                                                            	
                                                                              ILLEGALITY

                                                                            	
                                                                               
      43

                                                                            
	
                                                                              25.

                                                                            	
                                                                              ASSIGNMENTS AND
      TRANSFERS

                                                                            	
                                                                               
      44

                                                                            
	
                                                                              26.

                                                                            	
                                                                              SET-OFF

                                                                            	
                                                                               
      44

                                                                            
	
                                                                              27.

                                                                            	
                                                                              MISCELLANEOUS

                                                                            	
                                                                               
      45

                                                                            
	
                                                                              28.

                                                                            	
                                                                              FURTHER
      ASSURANCE

                                                                            	
                                                                               
      46

                                                                            
	
                                                                              29.

                                                                            	
                                                                              NOTICES

                                                                            	
                                                                               
      46

                                                                            
	
                                                                              30.

                                                                            	
                                                                              APPLICABLE LAW AND
      JURISDICTION

                                                                            	
                                                                               
      47

                                                                            
	
                                                                              Schedule
      l - Form of Notice of Drawdown

                                                                            	
                                                                               
      50

                                                                            
	
                                                                              Schedule
      2 - Form of Issue Request

                                                                            	
                                                                               
      51

                                                                            
	
                                                                              Schedule
      3 - Conditions Precedent Documents and Evidence

                                                                            	
                                                                               
      52

                                                                            
	
                                                                              Schedule
      4 - Form of Bank Guarantee

                                                                            	
                                                                               
      55

                                                                            

                                                                    

                                                                  

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

       

      
        
           

        

        
          
          

          
            

          

        

        
           

        

      

      THIS AGREEMENT is made on     20
November     2008

       

      BETWEEN

       

      (1)           KRONOS SHIPPING I, LTD. as
Borrower; and

       

      (2)           DEUTSCHE SCHIFFSBANK
AKTIENGESELLSCHAFT as Lender.

       

      WHEREAS

       

      The
Lender has agreed to make available to the Borrower:

       

      
        	
                (A)

              	
                a
      term loan facility of up to $30,000,000 for the purpose of providing pre-
      and post-delivery finance to be on lent by the Borrower to the Guarantor
      to assist the Guarantor in financing the purchase of the Vessel;
      and

              

      

       

      
        	
                (B)

              	
                a
      guarantee facility of up to $16,320,000 pursuant to which the Lender
      agrees to issue the Bank Guarantees to the Seller on behalf of the
      Borrower.

              

      

       

      IT
IS AGREED AS FOLLOWS

       

      
        	
                1. 

              	
                DEFINITIONS
      AND INTERPRETATION

              

      

       

      
        	
                1.1

              	
                Definitions

              

      

       

      In this
Agreement, including the Recital, the following expressions shall have the
following meanings:

       

      "Accounts" means the Earnings
Account and the Cash Collateral Account;

       

      "Accounts Security" means a
deed creating security in respect of the Cash Collateral Account to be executed
by the Borrower in such form as the Lender may approve or require;

       

      "Advances" means each part of
the Loan advanced by the Lender to the Borrower under this
Agreement;

       

      "Applicable Margin" means 1.4%
per annum;

       

      "Appraised Market Value" means
the value of the Vessel or the Building Contract determined in accordance with
Clause 19;

       

      "Approved Management Agreement"
means any agreement for the time being in force between the Guarantor and the
Approved Manager with respect to the management of the Vessel and which has been
approved by the Lender;

       

      "Approved Manager" means
Bernhard Schulte Shipmanagement or any other company which the Lender may from
time to time approve as the manager of the Vessel;

       

      "Approved Manager's
Undertaking" means the undertaking to be executed by the Approved Manager
with respect to the management of the Vessel and the rights of the Lender in
such form as the Lender may approve or require;

      
        
           

        

        
          1

          
            

          

        

        
           

        

      

      "Bank Guarantees" means the two
separate guarantees each in the maximum principal amount of $8,160,000 to be
issued by the Lender in favour of the Seller in respect of the Second Instalment
and the Third Instalment in the form of the pro forma bank guarantee attached at
Schedule 4;

       

      "Bank Guarantee Liabilities"
means all liabilities and obligations of the Lender under or pursuant to the
Bank Guarantees or under or pursuant to any renewal, extension or variation of
any Bank Guarantee;

       

      "Banking Day" means a day
(excluding Saturdays and Sundays) on which dealings in deposits in Dollars may
be carried out in the London Interbank Market and on which banks and foreign
exchange markets are open for business in London, Bremen and (if payment or
other dealing is required to be made on that day) in New York City and (in the
case of payment) the place to which such payment is required to be
made;

       

      "Borrower" means Kronos
Shipping I, Ltd. an exempted company with limited liability incorporated in the
Cayman Islands whose registered office is at c/o Walkers SPV Limited, Walker
House, 87 Mary Street, George Town, Grand Cayman KY1-9002, Cayman
Islands;

       

      "Breakage Costs" means, in the
case of any prepayment of the whole or any part of the Loan on a day other than
the last day of an Interest Period applicable to the whole of the amount
prepaid, such amount as shall be certified by the Lender as being necessary to
compensate the Lender for any loss (including, without limitation, loss of
profit), penalty or expense incurred or to be incurred by the Lender on account
of funds borrowed in order to make, fund or match the Loan (or any part thereof)
and/or in connection with the Master Agreement;

       

      "Builder" means Nantong Mingde
Heavy Industry Stock Co., Ltd., a company incorporated in the People's Republic
of China and whose principle office is Wujie Town, Tongzhou City, Jiangsu, the
People's Republic of China;

       

      "Building Contract" means the
building contract dated 12 December 2007 as amended by addendum no. 1 and made
between the Seller and the Guarantor relating to the construction of the Vessel
and includes any variation or amendment to the same prior to the date of this
Agreement;

       

      "Cash Collateral Account" means
the interest bearing bank account opened or to be opened in the name of the
Borrower with the Lender and designated "Kronos Shipping I, Ltd. - Cash
Collateral Account";

       

      "Cash Collateral Deposit" means
the aggregate amount of not less than $7,560,000 to be paid into and maintained
until the Second Instalment has been paid by the Borrower to the credit of the
Cash Collateral Account pursuant to Clause 13.4;

       

      "Classification" means the
classification DNV +1A1 Tanker for Chemicals ESP, Tanker for Oil Products ESP,
CSR, S.G. 1.53 for No.s 1, 3, 5 Cargo Tanks and Slop Tanks (P&S), Nauticus
(Newbuilding), BIS, SPM, E0 or such other classification as may from time to
time be approved in writing by the Lender;

       

      "Classification Society" means
DNV or such other classification society as may from time to time be approved in
writing by the Lender;

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      "Commitment Period" means the
period commencing on the date of this Agreement and ending on the earlier of in
respect of (i) the Loan, (a) 31 March 2012, (b) the Drawdown Date and (c) the
date on which
the Lender's obligation to make the Loan is cancelled and (ii) the Guarantee
Facility, (a) the payment in full by the Guarantor of the Third Instalment under
the Building Contract, (b) the Issue Date of the second Bank Guarantee and (c)
the date on which the Lender's obligation to issue the Bank Guarantees are
cancelled;

       

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

       

      "Contract Price" means
$41,413,000 as referred to in Article II of the Building Contract;

       

      "Deed of Covenants" means the
deed of covenants collateral to the Mortgage on the Vessel creating security in
respect of the Vessel to be executed by the Guarantor in such form as the Lender
(acting reasonably) may approve or require;

       

      "Default Rate" means the annual
rate of interest determined in accordance with Clause 8.3;

       

      "Delivered Cost" means the
total delivered cost of the Vessel being approximately $46,000,000 as verified
to the Lender consisting of all costs incurred by the Guarantor in acquiring
that Vessel and making her ready for sea including, without limitation, the cost
of providing all buyer's supplies under the Building Contract, the costs of
supervising the Vessel's construction, the costs of all financing fees and
interest expense incurred in respect of the Vessel during her construction, the
costs of any change orders and other upgrades made to the Vessel prior to her
Delivery Date, the costs of all legal fees incurred in connection with the
Vessel's construction and financing, the costs of provisioning the Vessel on or
prior to her Delivery Date and the costs of transporting the Vessel's master,
officers and crew to the Vessel;

       

      "Delivery Advance" means an
advance of the Loan to be made available in the maximum amount of $30,000,000 by
the Lender to the Borrower in accordance with Clause 2.2.1 on the Delivery
Date;

       

      "Delivery Date" means the date
on which the Vessel is delivered by the Seller to the Guarantor pursuant to the
Building Contract;

       

      "Dollars" (and the sign "$")
means the lawful currency for the time being of the United States of
America;

       

      "Drawdown Date" means the
Banking Day on which the Borrower specifies that it wishes the Loan to be
advanced or (as the context requires) the date on which the Loan is actually
advanced to the Borrower;

       

      "Earnings" means all moneys
whatsoever (and all claims for such moneys), present and future, which are
earned or recoverable by, or become payable to or for the account of, the
Guarantor at any time during the Security Period arising (whether in contract,
tort or otherwise howsoever), directly or indirectly, out of the ownership, use
or operation of the Vessel, including (but not limited to) all freight, hire and
passage moneys, compensation payable to the Guarantor in the event of
requisition of the Vessel for hire, remuneration for salvage and towage
services, demurrage and detention moneys, contributions in general average,
damages for breach (or payments for variation or termination) of any
charterparty or other contract for employment of the Vessel, and all moneys
(other than in respect of Insurances or Requisition Compensation) arising from a
Total Loss, together with the benefit of any guarantee, indemnity or other
security which may at any time be given to the Guarantor as security for the
payment of such moneys;

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

      "Earnings Account" has the
meaning given to it in Clause l3.1;

       

      "Encumbrance" means any
mortgage, charge, (whether fixed or floating), pledge, lien, hypothecation,
assignment, trust arrangement or security interest or other encumbrance of any
kind securing any obligation of any person or having the effect of conferring
security or any type of preferential arrangement (including, without limitation,
title transfer and/or retention arrangements having a similar
effect);

       

      "Environmental Affiliate" means
any agent or employee of the Borrower or any other Obligor in connection with
any Relevant Ship or its operation or the carriage of cargo and/or passengers
thereon and/or the provision of goods and/or services on or from the Relevant
Ship;

       

      "Environmental Approval" means
any permit, licence, approval, ruling, exemption or other authorisation required
under applicable Environmental Laws;

       

      "Environmental Claim"
means:

       

      
        	
                 
      

              	
                (a)

              	
                any
      claim by, or directive from, any applicable governmental, judicial or
      other regulatory authority alleging breach of, or non-compliance with, any
      Environmental Laws or Environmental Approvals or otherwise howsoever
      relating to or arising out of an Environmental Incident;
  or

              

      

       

      
        	
                 
      

              	
                (b)

              	
                any
      claim by any other person howsoever relating to or arising out of an
      Environmental Incident

              

      

       

      (and, in
each such case, "claim"
shall mean a claim for damages, clean-up costs, compliance, remedial action or
otherwise);

       

      "Environmental Incident"
means:

       

      
        	
                 
      

              	
                (a)

              	
                any
      release, discharge, disposal or emission of Material of Environmental
      Concern from a Relevant Ship; or

              

      

       

      
        	
                 
      

              	
                (b)

              	
                any
      incident in which Material of Environmental Concern is released,
      discharged, disposed of, or emitted by or from a ship other than a
      Relevant Ship and which involves collision between a Relevant Ship and
      such other ship, or some other incident of navigation or operation, in
      either case where a Relevant Ship, any of the Obligors or the managers of
      the Relevant Ship is or are actually or allegedly at fault or otherwise
      liable (in whole or in part); or

              

      

       

      
        	
                 
      

              	
                (c)

              	
                any
      incident in which Material of Environmental Concern is released,
      discharged, disposed of, or emitted by or from a ship other than a
      Relevant Ship and where the Relevant Ship is actually or potentially
      liable to be arrested or attached as a result and/or where any of the
      Obligors or the managers of the Relevant Ship is or are actually or
      allegedly at fault or otherwise
liable;

              

      

       

      "Environmental Laws" means all
national and international laws, ordinances, rules, regulations, rules of common
law, conventions and agreements pertaining to pollution or protection of human
health or the environment (including, without limitation, the United States Oil
Pollution Act of 1990 and any comparable laws of the individual States of the
United States of America);

       

      "Event of Default" means any of
the events listed in Clause 20.1;

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

      "Fifth Instalment" means the
fifth instalment of the Contract Price to be paid by the Guarantor to the Seller
under the Building Contract in the amount of $8,773,000 upon the Vessel's
delivery thereunder;

       

      "Financial Indebtedness" means
any indebtedness in respect of:

       

      
        	
                 
      

              	
                (a)

              	
                moneys
      borrowed or raised and interest
thereon;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                any
      bond, bill of exchange, note, loan stock, debenture, commercial paper or
      similar security or instrument;

              

      

       

      
        	
                 
      

              	
                (c)

              	
                acceptance,
      documentary credit or guarantee
facilities;

              

      

       

      
        	
                 
      

              	
                (d)

              	
                deferred
      payments for assets or services
acquired;

              

      

       

      
        	
                 
      

              	
                (e)

              	
                rental
      payments so far as attributable to payment of capital under finance
      leases, whether in respect of land, buildings, machinery or equipment or
      otherwise;

              

      

       

      
        	
                 
      

              	
                (f)

              	
                payments
      under hire purchase contracts;

              

      

       

      
        	
                 
      

              	
                (g)

              	
                factored
      debts, to the extent that there is
recourse;

              

      

       

      
        	
                 
      

              	
                (h)

              	
                guarantees,
      bonds, standby letters of credit or other instruments issued in connection
      with the performance of contracts or
  obligations;

              

      

       

      
        	
                 
      

              	
                (i)

              	
                any
      interest or currency swap or any other form of derivative
      transaction;

              

      

       

      
        	
                 
      

              	
                (j)

              	
                guarantees,
      indemnities or other assurances against financial loss in respect of
      indebtedness of any person falling within any of paragraphs (a) to (i)
      inclusive above; and

              

      

       

      
        	
                 
      

              	
                (k)

              	
                amounts
      raised or obligations incurred under any other transaction having the
      commercial effect of any of the
above;

              

      

       

      "Flag State" means Norway or
any state or territory in the European Union approved by the Lender, at the
request of the Guarantor;

       

      "First Instalment" means, the
first instalment of the Contract Price paid by the Guarantor to the Seller under
the Building Contract in the amount of $8,160,000 upon receipt of the Refund
Guarantee;

       

      "Fourth Instalment" means, the
fourth instalment of the Contract Price to be paid by the Guarantor to the
Seller under the Building Contract in the amount of $8,160,000 on launching of
the Vessel;

       

      "General Assignment" means the
assignment of the Insurances, Earnings and Requisition Compensation of the
Vessel to be executed by the Guarantor in such form as the Lender may approve or
require;

       

      "Guarantee" means the guarantee
of the Borrower's obligations pursuant to this Agreement, to be executed by the
Guarantor in such form as the Lender (acting reasonably) may approve or
require;

       

      "Guarantee Facility" means the
guarantee facility in the sum of up to $16,320,000 made available to the
Borrower by the Lender under this Agreement;

      
        
           

        

        
          5

          
            

          

        

        
           

        

      

      "Guarantor" means Anthos
Shipping Co. Limited, a company incorporated in the Republic of Cyprus whose
registered office is at 284 Arch., Makariou III, Fortuna Court, Block B, 2nd Floor,
3105 Limassol, Cyprus;

       

      "Indebtedness" means any
obligation for the payment or repayment of moneys, whether present or future,
actual or contingent, sole or joint;

       

      "Insurances" means all policies
and contracts of insurance (including all entries of the Vessel in a protection
and indemnity association and a war risks association) which are from time to
time taken out or entered into in respect of the Vessel or its Earnings or
otherwise howsoever (as specified in greater detail in the Security Documents)
and all benefits of such policies and contracts, including all claims of
whatsoever nature and return of premiums;

       

      "Interest Date" means a date
upon which interest is due and payable in accordance with
Clause 7.1;

       

      "Interest Period" means each
period determined in accordance with Clause 7 or Clause 22, as the
case may be;

       

      "Interest Rate" means the
annual rate of interest which is determined by the Lender in accordance with
Clause 8.2 or Clause 22, as the case may be;

       

      "Issue Date" means, in respect
of a Bank Guarantee, the Banking Day on which the Borrower specifies that it
wishes such Bank Guarantee to be issued or (as the context requires) the date on
which such Bank Guarantee is actually issued to the Seller;

       

      "Issue Request" means a notice
in the form set out in Schedule 2;

       

      "JXTTC" means Jiangxi Topsky
Technology Co., Ltd. a company incorporated in the People's Republic of China
with its registered office at N0.200 Zangqian Road, Nanchang City 330002,
Jiangxi Province, the People's Republic of China;

       

      "Lender" means Deutsche
Schiffsbank Aktiengesellschaft, acting through its office at Domshof 17, 28195
Bremen, Federal Republic of Germany;

       

      "LIBOR" means, in relation to
an Interest Period or any other relevant period:

       

      
        	
                 
      

              	
                (a)

              	
                the
      rate per annum that appears on Telerate Page 3750 at or about 11.00 a.m.
      (London time) 2 London Banking Days before the commencement of that period
      for deposits in Dollars in an amount comparable with the amount of the
      Loan or part thereof or other relevant sum for a period equivalent to such
      period for delivery on the first Banking Day of such period;
      or

              

      

       

      
        	
                 
      

              	
                (b)

              	
                if
      no display rate is then displayed or if the Lender determines that no rate
      for a period comparable in duration with the relevant period is displayed
      on Telerate Page 3750 for Dollars, the arithmetic mean (rounded upwards to
      the nearest one sixteenth of one per cent (1/16%)) of the rates per annum
      quoted by the Lender to leading banks in the London Interbank Market at or
      about 11.00 a.m. London time 2 London Banking Days before the commencement
      of that period for the offering of deposits in Dollars of an amount
      comparable with the amount of the Loan or relevant part thereof or other
      relevant sum (as the case may be) at the commencement of such period for a
      period comparable with such period fixed for its
  duration;

              

      

       

      
        
           

        

        
          6

          
            

          

        

        
           

        

      

       

      
        	
                 
      

              	
                and,
      for the purposes of this definition, "Telerate Page 3750"
      means the display designated as "Page 3750" on the
      Telerate Service (or other such page as may replace Page 3750 on that
      service or such other service as may be nominated by the British Bankers'
      Association as the information vendor for the purpose of displaying
      British Bankers' Association Interest Settlement Rates for deposits in
      Dollars);

              

      

       

      "Loan" means the sum of up to
$30,000,000 to be advanced by the Lender to the Borrower under this Agreement
and, as the context may require, means the principal amount from time to time
outstanding under this Agreement;

       

      "Master Agreement" means any
"Deutscher Rahmenvertrag (Rahmenvertrag fur Finanztermingeschäfte)" entered into
between the Lender and the Borrower during the Security Period conducted at the
sole discretion of the Lender, including each Schedule to any Master Agreement
and each Confirmation exchanged pursuant to any Master Agreement;

       

      "Material of Environmental
Concern" means and includes chemicals, pollutants, contaminants, waste,
toxic or hazardous substances, oil, petroleum and oil and petroleum products and
any other polluting substances, the release, discharge, disposal or emission of
which into the environment is regulated, prohibited or penalised by or pursuant
to any Environmental Law;

       

      "Mortgage" means the first
priority statutory ship mortgage over the Vessel to be executed by the Guarantor
in such form as the Lender may approve or require;

       

      "Notice of Drawdown" means a
notice in the form set out in Schedule 1;

       

      "Obligor" means any party from
time to time to any of the Security Documents, other than the
Lender;

       

      "Outstanding Indebtedness"
means the aggregate of the Loan, the Bank Guarantee Liabilities, any
Rahmenvertrag Liabilities, all interest accrued on the Loan and all other sums
of money whatsoever from time to time due or owing actually or contingently to
the Lender under or pursuant to the Security Documents;

       

      "Permitted Encumbrance"
means:

       

      
        	
                 
      

              	
                (a)

              	
                any
      Encumbrance created by or pursuant to the Security Documents;
      and

              

      

       

      
        	
                 
      

              	
                (b)

              	
                liens
      on the Vessel for crew's wages or salvage or otherwise arising in the
      normal course of trading and being regularly settled, the total amount of
      such lien or liens not to be material to the security created in favour of
      the Lender pursuant to the Security Documents in respect of the
      Vessel;

              

      

       

      "Potential Event of Default"
means an event or circumstance which, with the giving of any notice, lapse of
time, determination of the Lender in accordance with the relevant provisions of
this Agreement and the other Security Documents or satisfaction of any other
condition would constitute an Event of Default;

       

      "Pre-Delivery Advances" means
the three (3) pre-delivery advances to be made available in the aggregate
maximum amount of $16,920,000 by the Lender to the Borrower in accordance with
Clause 2.2.1 and "Pre
Delivery Advance" means any of them;

      
        
           

        

        
          7

          
            

          

        

        
           

        

      

    

     

    "Pre-Delivery Security
Assignment" means the assignment of the Building Contract and the Refund
Guarantee to be executed by the Guarantor in the agreed form;

     

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

     

    "Refund Guarantee" means the
irrevocable guarantee dated 11 April 2008 with reference number LGC5500800231
issued by the Refund Guarantor to the Guarantor as security for the Seller's
refund obligations to the Guarantor under the Building Contract in respect of
the pre-delivery Instalments paid or to be paid thereunder;

     

    "Refund Guarantor" means Bank
of China Limited, Jiangxi Branch, a company incorporated in the People's
Republic of China with its registered office is at 1, Zhanqian Xi Lu, Nanchang,
Jiangxi, 330002, the People's Republic of China;

     

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

     

    "Repayment Date" means each of
the Banking Days upon which a Repayment Instalment is due and payable in
accordance with Clause 5.3;

     

    "Repayment Instalment" means
each of the instalments of the Loan becoming due on a Repayment Date in
accordance with Clause 5.1;

     

    "Requisition Compensation"
means all moneys or other compensation payable during the Security Period by
reason of requisition for title or other compulsory acquisition of the Vessel
otherwise than by requisition for hire;

     

    "Second Instalment" means, the
second instalment of the Contract Price to be paid by the Guarantor to the
Seller under the Building Contract in the amount of $8,160,000 following cutting
of the first steel plate of the Vessel;

     

    "Security Documents" means this
Agreement, the Master Agreement, the documents specified in Clause 15 and
any and every other document from time to time executed to secure, or to
establish a subordination or priorities arrangement in relation to, all or any
of the obligations of any person to the Lender under this Agreement, the Master
Agreement or any other Security Documents;

     

    "Security Period" means the
period from the date of this Agreement until the discharge of the security
created by the Security Documents by final and irrevocable repayment or payment
in full of the Outstanding Indebtedness;

     

    "Seller" means together the
Builder and JXTTC;

     

    "Shareholder" means III to I
Maritime Partners Cayman I, L.P. an exempted limited partnership formed and
registered in the Cayman Islands with its registered address at c/o Walkers SPV
Limited, Walker House, 87 Mary Street, George Town, Grand Cayman KY1-9002,
Cayman Islands;

     

    "Shares Security" means, the
deed creating security over the whole of the issued share capital of the
Borrower to be executed by the Shareholder in such form as the Lender may
approve or require;

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    "Third Instalment" means the
third instalment of the Contract Price to be paid by the Guarantor to the Seller
under the Building Contract in the amount of $8,160,000 following laying of the
Vessel's keel;

     

    "Total Loss" means (a) actual,
constructive, compromised, agreed 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) capture, seizure, arrest, detention or
confiscation of the Vessel, by any government or by any persons acting or
purporting to act on behalf of any government, unless the Vessel be released and
restored to the Guarantor within 1 month thereafter;

     

    "Total Loss Date" means the
date upon which a Total Loss shall be deemed to have occurred,
being:

     

    
      	
               
      

            	
              (a)

            	
              if
      it consists of an actual loss, at noon London time on the actual date of
      loss or, if that is not known, on the date when the Vessel was last heard
      of;

            

    

     

    
      	
               
      

            	
              (b)

            	
              if
      it consists of a requisitioning for title, at noon London time on the date
      on which the requisition is expressed to take effect by the person
      requisitioning the Vessel; and

            

    

     

    
      	
               
      

            	
              (c)

            	
              if
      it consists of a constructive or compromised or arranged or agreed Total
      Loss, at noon London time on the earliest
of:

            

    

     

    
      	
               
      

            	
              (i)

            	
              the
      date on which notice of abandonment of the Vessel is given to its
      insurers;

            

    

     

    
      	
               
      

            	
              (ii)

            	
              if
      her insurers do not admit the claim for Total Loss, the actual date of
      loss or alleged loss; and

            

    

     

    
      	
               
      

            	
              (iii)

            	
              the
      date of any compromise, arrangement or agreement entered into by or on
      behalf of the Borrower with the Vessel's insurers in respect of the Total
      Loss;

            

    

     

    "Underlying Documents" means
the Building Contract, the Refund Guarantee and any Approved Management
Agreement in respect of the Vessel;

     

    "Vessel" means the
product/chemical tanker IMO II new building of approximately 25,000 dwt with
hull number MD2007-11-12 currently under construction at the yard of the Builder
and to be acquired by the Guarantor pursuant to the Building Contract and
registered under an approved Flag State.

     

    1.2          Interpretation

     

    
      	
               
      

            	
              1.2.1

            	
              The
      following expressions shall be construed in the following
      manner:

            

    

     

    "Lender" includes the
successors and assigns of the Lender;

     

    "Borrower", "Guarantor" and "Obligor" include their
respective legal personal representatives, administrators, successors and
permitted assigns;

     

    "person" includes a corporate
entity and any body of persons, corporate or unincorporate;

     

    "subsidiary" and "holding company" have the
meanings given to them by Section 736 of the Companies Act 1985;

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    "taxes" includes all present
and future income, corporation and value-added taxes and all stamp and other
taxes, duties, levies, imposts, deductions, charges and withholdings whatsoever,
together with interest thereon and penalties with respect thereto, if any, and
any payments of principal, interest, charges, fees or other amounts made on or
in respect thereof, and references to "tax" and "taxation" shall be construed
accordingly; and

     

    "associate" has the meaning
given to it by Section 435 of the Insolvency Act 1986.

     

    
      	
               
      

            	
              1.2.2

            	
              Unless
      the context otherwise requires, words in the singular include the plural
      and vice versa.

            

    

     

    
      	
               
      

            	
              1.2.3

            	
              References
      to any document include the same as varied, supplemented or replaced from
      time to time.

            

    

     

    
      	
               
      

            	
              1.2.4

            	
              References
      to any enactment include re-enactments, amendments and extensions
      thereof.

            

    

     

    
      	
               
      

            	
              1.2.5

            	
              Clause headings
      are for convenience of reference only and are not to be taken into account
      in construction.

            

    

     

    
      	
               
      

            	
              1.2.6

            	
              Unless
      otherwise specified, references to Clauses, Recitals and Schedules are
      respectively to Clauses of and Recitals and Schedules to this
      Agreement.

            

    

     

    
      	
               
      

            	
              1.2.7

            	
              In
      this Agreement, references to periods of "months" shall mean a period
      beginning in one calendar month and ending in the relevant calendar month
      on the day numerically corresponding to the day of the calendar month in
      which such period started, provided that (a) if such period started on the
      last Banking Day in a calendar month, or if there is no such numerically
      corresponding day, such period shall end on the last Banking Day in the
      relevant calendar month and (b) if such numerically corresponding day is
      not a Banking Day, such period shall end on the next following Banking Day
      in the same calendar month, or if there is no such Banking Day, such
      period shall end on the preceding Banking Day (and "month" and "monthly"
      shall be-construed accordingly).

            

    

     

    
      	
               
      

            	
              1.2.8

            	
              A
      person who is not a party to this Agreement may not enforce, or otherwise
      have the benefit of, any provision of this Agreement under the Contracts
      (Rights of Third Parties) Act 1999.

            

    

     

    2.           THE
LOAN

     

    2.1          Agreement to
advance

     

    Subject
to the provisions of this Agreement the Lender agrees to make available the Loan
to the Borrower in several Advances in an amount not exceeding $30,000,000 which
Advances are to be on lent by the Borrower to the Guarantor and applied by the
Guarantor (i) in or towards payment of the second, third and fourth instalments
payable to the Seller under the Building Contract and (ii) in or towards
refinancing the Pre-Delivery Advances and in payment of the delivery instalment
payable to the Seller under the Building Contract on the Delivery
Date.

     

    2.2          Availability

     

    
      	
               
      

            	
              2.2.1

            	
              The
      Loan will be available to be drawn in up to 4 Advances each as
      follows:

            

    

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (a)

            	
              the
      first Advance shall be drawn in an amount of up to $600,000 and shall be
      applied towards paying the Second Instalment to the
  Seller;

            

    

     

    
      	
               
      

            	
              (b)

            	
              the
      second Advance shall be drawn in an amount of up to $8,160,000 and shall
      be applied towards paying the Third Instalment to the
    Seller;

            

    

     

    
      	
               
      

            	
              (c)

            	
              the
      third Advance shall be drawn in an amount of up to $8,160,000 and shall be
      applied towards paying the Fourth Instalment to the
  Seller;

            

    

     

    
      	
               
      

            	
              (d)

            	
              the
      fourth Advance shall be shall be the Delivery Advance of up to $30,000,000
      consisting of the Pre-delivery Advances to be consolidated and $13,080,000
      to be applied towards paying the Fifth Instalment to the Seller and, as to
      the balance, in reimbursing any other Delivered Costs which have been
      incurred.

            

    

     

    
      	
               
      

            	
              2.2.2

            	
              Each
      Advance shall be applied exclusively for the purposes specified in
      Clause 2.2.1, provided that the Lender shall not be bound to monitor
      or verify the application of the proceeds of any Advance (or any part
      thereof) other than the Pre-Delivery
Advances.

            

    

     

    2.3          Duration of Lender's
commitment

     

    The
Lender will have no liability whatsoever to advance the Loan or any part of the
Loan after the date of the expiry of the Commitment Period and any part of the
Loan which has not been advanced to the Borrower at close of business on such
date shall be cancelled.

     

    3.           DRAWDOWN

     

    3.1          Notice of
drawdown

     

    The
Borrower may draw an Advance subject to giving the Lender an executed Notice of
Drawdown not later than 10:00 a.m. London time three (3) Banking Days before the
proposed Drawdown Date, which notice shall:

     

    
      	
               
      

            	
              3.1.1

            	
              be
      effective on receipt by the Lender;

            

    

     

    
      	
               
      

            	
              3.1.2

            	
              specify
      the Banking Day during the Commitment Period upon which that Advance is
      required;

            

    

     

    
      	
               
      

            	
              3.1.3

            	
              specify
      the Borrower's choice of duration of the first Interest
      Period;

            

    

     

    
      	
               
      

            	
              3.1.4

            	
              give
      full details of the place and account, which must be acceptable to the
      Lender, to which the proceeds of that Advance are to be
    paid;

            

    

     

    
      	
               
      

            	
              3.1.5

            	
              constitute
      a representation and warranty in the terms of Clause 16;
      and

            

    

     

    
      	
               
      

            	
              3.1.6

            	
              be
      irrevocable.

            

    

     

    3.2          Conditions
precedent

     

    Notwithstanding
the giving of a Notice of Drawdown pursuant to Clause 3.1, the Lender shall
not be obliged to disburse any funds until all the conditions set out in
Clause 14 have been satisfied or waived.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    3.3          Application of proceeds of each
Advance

     

    Subject
to the provisions of this Agreement, the Lender will pay to the Borrower on each
Drawdown Date the amount of such Advance by applying the same in accordance with
the Notice of Drawdown given by the Borrower.

     

    3.4          Deemed
Indebtedness

     

    The
payment by the Lender under Clause 3.3 shall constitute the making of that
Advance and the Borrower shall thereupon become indebted to the Lender in the
amount of such Advance (in addition to any amount previously advanced by the
Lender pursuant to this Agreement).

     

    4.           GUARANTEE
FACILITY

     

    4.1          Agreement to
issue

     

    Subject
to the provisions of this Agreement, the Lender agrees to issue the Bank
Guarantees to the Seller on behalf of the Borrower. For the avoidance of doubt,
the Bank Guarantee in respect of the Third Instalment will only be issued on
payment of the Second Instalment by the Borrower and cancellation of the Bank
Guarantee in respect of the same.

     

    4.2          Issue Request

     

    Subject
to the terms and conditions of this Agreement, the Lender shall issue a Bank
Guarantee if the Borrower gave the Lender a duly completed Issue Request not
later than 10:00 a.m. London time three (3) Banking Days before the proposed
Issue Date, which notice shall be irrevocable and will not be regarded as having
been duly completed unless the proposed Issue Date is a Banking Day within the
Commitment Period relating to the Guarantee Facility.

     

    4.3          Conditions
precedent

     

    Notwithstanding
the giving of an Issue Request in relation thereto pursuant to Clause 4.2,
the Lender shall not issue a Bank Guarantee unless the following conditions
precedent are satisfied:

     

    
      	
               
      

            	
              4.3.1

            	
              in
      respect of the Bank Guarantee for the Second Instalment, evidence that (i)
      the Cash Collateral Deposit has been irrevocably and unconditionally paid
      into the Cash Collateral Account and the Accounts Security duly executed
      by the Borrower or (ii) a guarantee of a company acceptable to the Lender
      and in a form acceptable to the Lender has been duly
    executed;

            

    

     

    
      	
               
      

            	
              4.3.2

            	
              the
      Lender has received payment of the fees and expenses specified in
      Clause 21 to the extent due and payable on or before the Issue Date
      of that Bank Guarantee;

            

    

     

    
      	
               
      

            	
              4.3.3

            	
              the
      Lender has received the documents and evidence described in Part A of
      Schedule 3, in form and substance satisfactory to
  it;

            

    

     

    
      	
               
      

            	
              4.3.4

            	
              the
      Lender is satisfied that at the Issue Date of that Bank
      Guarantee:

            

    

     

    
      	
               
      

            	
              (a)

            	
              the
      representations and warranties contained in Clause 16 are true and
      correct;

            

    

     

    
      	
               
      

            	
              (b)

            	
              none
      of the circumstances specified in Clauses 4.11 or Clause 23 is
      subsisting; and

            

    

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (c)

            	
              no
      Event of Default or Potential Event of Default has occurred or will arise
      following the issue of that Bank
Guarantee.

            

    

     

    4.4          Waiver of conditions
precedent

     

    If the
Lender in its absolute discretion issues a Bank Guarantee notwithstanding that
one or more of the conditions precedent specified above in relation thereto
remains unsatisfied on the relevant Drawdown Date, the Borrower shall procure
the satisfaction of such condition or conditions precedent within ten (10) days
thereafter or such longer period as the Lender may in its absolute discretion
agree in writing.

     

    4.5          Release of Bank
Guarantees

     

    The
Borrower shall procure that each Bank Guarantee is returned to the Lender duly
cancelled forthwith upon the payment by the Borrower of the Second Instalment
and the Third Instalment relating thereto or, if earlier, upon termination
howsoever of the Building Contract.

     

    4.6          Bank Guarantees - direction to
pay

     

    The
Borrower irrevocably directs the Lender to make such payments and comply with
such demands or claims made on the Lender under the Bank Guarantees or otherwise
in respect of or purporting to be in respect of the Bank Guarantee Liabilities
as the Lender in its absolute discretion thinks fit without any reference to or
further authority or direction from the Borrower, or any necessity to obtain the
Borrower's confirmation or verification, and notwithstanding that the Borrower
may have disputed the Lender's liability to pay or comply. The Borrower agrees
that the Lender may treat the Bank Guarantee Liabilities as payable on first
demand and that any such payment or compliance or purported compliance by the
Lender shall as between the Lender and the Borrower be conclusive evidence that
the Lender was liable to make the payment or comply with the demand or claim
absent negligence or wilful default by the Lender.

     

    4.7          Bank Guarantees - underlying
transaction

     

    The
Borrowers acknowledge that the Lender:

     

    
      	
               
      

            	
              4.7.1

            	
              is
      not obliged to carry out any investigation or seek any confirmation from
      any other person before paying a demand or claim made on it in respect of
      or purporting to be in respect of the Bank Guarantee Liabilities;
      and

            

    

     

    
      	
               
      

            	
              4.7.2

            	
              deals
      in documents only and will not be concerned with the legality of any
      demand or claim or any underlying transaction or any available set-off,
      counterclaim or other defence of any
person.

            

    

     

    4.8          Bank Guarantees - propriety of
demand

     

    The
Lender shall be entitled to rely without further enquiry on any demand, claim,
document or other communication believed by it in good faith to be genuine and
correct and to have been signed or otherwise executed or made by the proper
person.

     

    4.9          Bank Guarantees - indemnity from
Borrower to Lender

     

    In
consideration of the obligations undertaken by the Lender under this
Clause 4, the Borrower agrees:

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              4.9.1

            	
              to
      pay to the Lender in Dollars, on first written demand, each and every
      amount which the Lender certifies to the Borrower it has paid pursuant to
      any of the Bank Guarantees;

            

    

     

    
      	
               
      

            	
              4.9.2

            	
              at
      all times as a continuing security keep the Lender indemnified on demand
      against all claims, payments, costs, liabilities, damages, losses,
      proceedings, taxes and expenses of whatever nature (including any
      exchange, control premiums, penalties or expenditure) incurred or suffered
      by the Lender directly by reason of or in connection with the Bank
      Guarantees and to pay to the Lender on demand the amount of the Bank
      Guarantee Liabilities which may from time to time be claimed or demanded
      from the Lender, or which the Lender shall or may pay or may suffer or
      incur under, or by reason of, or otherwise in connection with the Bank
      Guarantees;

            

    

     

    
      	
               
      

            	
              4.9.3

            	
              to
      pay to the Lender on demand from time to time all amounts payable by the
      Borrower under this Clause 4.9 with interest at the Default Rate on
      each of those amounts from the date on which such amount is paid or
      incurred by the Lender until the date of the Borrower's payment to the
      Lender, before or after any relevant
judgment.

            

    

     

    4.10         Bank Guarantees-evidence of
termination or reduction

     

    The
Borrower shall supply the Lender promptly with such evidence as the Lender may
reasonably require of the termination or reduction of any part of the Bank
Guarantee Liabilities.

     

    4.11         Bank
Guarantees-illegality

     

    If the
introduction of, or any change in, any applicable law or regulation, or in the
interpretation thereof by any authority charged with the administration thereof
or by any court of competent jurisdiction, makes it unlawful for the Lender to
issue the Bank Guarantees, the Lender's obligation under this Agreement to issue
the Bank Guarantees shall terminate forthwith and the Guarantee Facility shall
be cancelled.

     

    In order
to avoid the incidence of any such illegality, the Lender shall consider in its
absolute discretion, applying for any appropriate relief, waiver or exemption
from the same or subject to obtaining any necessary consents and authorisations,
fulfilling its obligations through another lending office, transferring its
rights and obligations at par to one or more of its affiliates (in each case to
be acceptable to the Borrower).

     

    5.           REPAYMENT

     

    
      	
              5.1

            	
              Each
      Pre-delivery Advance shall be repaid in full on the Delivery Date and in
      any event no later than 31 March
2012.

            

    

     

    
      	
              5.2

            	
              Subject
      to the provisions of this Agreement, the Borrower shall repay the Delivery
      Advance in 40 Repayment Instalments of $500,000 each and by a balloon
      instalment in the amount of $10,000,000 payable at the same time as the
      said fortieth and final Repayment Instalment. The fortieth and final
      instalment shall in any event be repaid no later than 31 March 2022. If
      the full amount of the Delivery Advance is not advanced to the Borrower or
      is prepaid in accordance with Clause 6.1, the amount of each
      Repayment Instalment shall be reduced pro rata to the amount actually
      advanced or prepaid.

            

    

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    5.3          Repayment
Dates

     

    The
Repayment Instalments in Clause 5.1 shall be paid on the Banking Days
falling at successive three (3) monthly intervals from whichever is the earlier
of (a) the Drawdown Date of the Delivery Advance, (b) the Delivery Date and (c)
31 March 2012, provided that where a Repayment Date is not a Banking Day, the
relevant Repayment Date shall fall on the next succeeding Banking Day, unless
that Banking Day falls in the next calendar month, in which event the Repayment
Date shall be the immediately preceding Banking Day.

     

    5.4          Final repayment

     

    On the
final Repayment Date the Borrower shall additionally pay to the Lender all sums
which are then accrued or owing to the Lender under any Security
Document.

     

    6.           PREPAYMENT

     

    6.1          Minimum prepayment and
notice

     

    The
Borrower shall have the right to prepay the Loan, in whole or in part, on any
Interest Date subject to the following conditions:

     

    
      	
               
      

            	
              6.1.1

            	
              any
      prepayment of part of the Loan must be in a minimum amount of $1,000,000
      and in an integral multiple of $100,000;
and

            

    

     

    
      	
               
      

            	
              6.1.2

            	
              the
      Lender must receive not less than five (5) Banking Days' notice specifying
      the amount to be prepaid and the date on which the prepayment is to be
      made.

            

    

     

    6.2          Mandatory
Prepayment

     

    
      	
               
      

            	
              6.2.1

            	
              If
      the Vessel is sold or becomes a Total Loss the Borrower shall prepay the
      Loan in full on or before the Relevant
Date.

            

    

     

    For the
purposes of this Clause 6.2.1,"Relevant Date" means in
relation to a sale of the Vessel, the date of such sale and, in relation to a
Total Loss, the date which is the earlier of:

     

    
      	
               
      

            	
              (a)

            	
              the
      date 90 days after the Total Loss Date;
and

            

    

     

    
      	
               
      

            	
              (b)

            	
              the
      date upon which the insurance proceeds or Requisition Compensation in
      respect of the Vessel are received by the Lender pursuant to the
      provisions of the relevant Security
Documents.

            

    

     

    
      	
               
      

            	
              6.2.2

            	
              If
      it becomes impossible or unlawful for the Borrower to fulfil any of its
      obligations under the Security Documents, or for the Lender to exercise
      any of the rights vested in it by, or to enforce the security constituted
      by, the Security Documents, or any of the Security Documents for any
      reason becomes invalid or unenforceable or ceases to be in full force and
      effect or the Borrower repudiates or threatens to repudiate any of the
      Security Documents the Borrower shall prepay the Loan in full on the date
      reasonably requested by the Lender in
writing.

            

    

     

    6.3          Conditions of
prepayment

     

    The
following shall apply to any prepayment under this Agreement:

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              6.3.1

            	
              each
      prepayment must be made together with the accrued interest on the amount
      prepaid and all other sums payable in respect thereof under the provisions
      of this Agreement and, in the case of prepayment of the whole of the Loan,
      shall be accompanied by payment of all other Outstanding
      Indebtedness;

            

    

     

    
      	
               
      

            	
              6.3.2

            	
              any
      prepayment of part of the Loan will be applied in or towards the discharge
      of the remaining Repayment Instalments in inverse order of
      maturity;

            

    

     

    
      	
               
      

            	
              6.3.3

            	
              any
      notice of prepayment given by the Borrower shall be effective on receipt
      by the Lender and shall be irrevocable once given and the Borrower shall
      be bound to make such prepayment in accordance
  therewith;

            

    

     

    
      	
               
      

            	
              6.3.4

            	
              except
      as specifically provided in this Agreement or in any other of the Security
      Documents, in the absence of an Event of Default and demand for repayment
      by the Lender, the Lender shall not be obliged to accept any other
      prepayment of the whole or any part of the
Loan;

            

    

     

    
      	
               
      

            	
              6.3.5

            	
              any
      part of the Loan which is repaid or prepaid by the Borrower may not be
      redrawn; and

            

    

     

    
      	
               
      

            	
              6.3.6

            	
              any
      prepayment made on a day other than the last day of an Interest Period
      applicable to the whole amount prepaid shall be made together with any
      Breakage Costs.

            

    

     

    7.           INTEREST
PERIODS

     

    7.1          Borrower's selection of Interest
Periods

     

    Subject
to Clause 7.2 and to the other provisions of this Agreement, the Borrower
may, by giving notice in writing to the Lender not later than 10.00 a.m. London
time three (3) Banking Days before the first day of each Interest Period, select
the duration (being a period of three (3) or six (6) months or such other period
longer than six (6) months as the Borrower may select and the Lender may agree)
of that Interest Period.

     

    7.2          Determination of
duration

     

    The
following shall apply in determining the duration of an Interest Period in
respect of each Advance:

     

    
      	
               
      

            	
              7.2.1

            	
              the
      first Interest Period for an Advance shall commence on the first Drawdown
      Date;

            

    

     

    
      	
               
      

            	
              7.2.2

            	
              the
      first Interest Period for each Advance subsequent to such first Advance
      made under this Agreement shall, insofar as the Lender considers it
      appropriate, expire on the date of expiry of the concurrent Interest
      Period applicable to the first such Advance (otherwise upon the expiry of
      the next Interest Period applicable to the first such Advance) and
      thereafter all subsequent Interest Periods in respect of each Advance
      shall end on the same days and be of the same concurrent duration as the
      Interest Periods for the Advances previously made, and the Borrower shall
      make its selection of each such Interest Period accordingly, subject as
      provided in Clause 7.2.4;

            

    

     

    
      	
               
      

            	
              7.2.3

            	
              each
      Interest Period subsequent to the first Interest Period for each Advance
      shall commence on the last day of the immediately preceding Interest
      Period for that Advance;

            

    

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              7.2.4

            	
              the
      Borrower shall make each selection under this Clause 7.2 (and in the
      case of the duration of the Interest Period being determined in accordance
      with Clause 7.2.5 below shall be deemed to have selected the period
      so determined) in such manner as to ensure that, in the event that any
      Repayment Date falls within the Interest Period so selected, a separate
      Interest Period is selected in respect of the part of an Advance due to be
      repaid under Clause 4 on such Repayment Date, the expiry of which
      period coincides with the relevant Repayment Date (and for this purpose
      alone the Borrower shall be entitled to select Interest Periods of
      different lengths in relation to an
Advance);

            

    

     

    
      	
               
      

            	
              7.2.5

            	
              in
      the absence of any such selection by the Borrower of the duration of an
      Interest Period, or if the Lender shall certify to the Borrower that the
      funds requested are not available for an Interest Period of the duration
      selected by the Borrower, the duration of that Interest Period shall
      (subject as provided in this Clause 7.2) be three (3) months or such
      other period as the Lender may
specify;

            

    

     

    
      	
               
      

            	
              7.2.6

            	
              if
      the last day of any Interest Period would otherwise fall on a day which is
      not a Banking Day, that Interest Period shall be extended (subject to
      Clause 7.2.7 below) so as to end on the next succeeding Banking Day,
      unless by virtue of such extension the Interest Period would end in the
      next calendar month, in which case it shall be shortened so as to end on
      the immediately preceding Banking Day;
and

            

    

     

    
      	
               
      

            	
              7.2.7

            	
              no
      Interest Period shall extend beyond the final Repayment
    Date.

            

    

     

    7.3          Lender's notification of Interest
Period

     

    The
Lender will notify the Borrower of each determination of the duration of an
Interest Period promptly upon the determination thereof.

     

    8.           INTEREST
AND DEFAULT INTEREST

     

    8.1          Interest Dates

     

    Subject
to the provisions of this Agreement, the Borrower shall pay interest on the
Loan, or any part thereof (as the case may be), at the Interest Rate applicable
thereto in arrears on the last day of each Interest Period applicable thereto,
except in the case of an Interest Period longer than six (6) months where
interest shall be paid every six (6) months during that Interest Period and on
the last day of that Interest Period.

     

    8.2          Interest Rate

     

    Subject
to the provisions of this Agreement, the Interest Rate applicable to each
Advance or any part thereof (as the case may be) for each Interest Period
relating thereto will be the annual rate of interest determined by the Lender to
be the aggregate of (a) the Applicable Margin and (b) LIBOR for that Interest
Period.

     

    8.3          Default interest

     

    Without
prejudice to any other remedy of the Lender, if the Borrower fails to pay on the
due date any sum (whether of principal, interest or otherwise) due under any one
or more of the Security Documents, interest will accrue, and become payable upon
demand by the Lender, upon the sum unpaid from and including the date upon which
it fell due for payment until the date of actual payment by the Borrower (as
well after as before judgment) at the rate per annum determined by the Lender to
be equal to 2% plus whichever is the higher of:

    
      
         

      

      
        17

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              8.3.1

            	
              the
      rate of interest applicable to the sum unpaid (if of principal)
      immediately prior to its due date, provided that such rate shall apply
      only for any unexpired portion of the Interest Period relating to such
      overdue principal and thereafter the rate applicable to such overdue
      principal shall be determined in accordance with Clause 8.3.2 below
      for so long as the default continues;
and

            

    

     

    
      	
               
      

            	
              8.3.2

            	
              the
      aggregate of the Applicable Margin and LIBOR for periods of such duration
      as the Lender may determine from time to
time.

            

    

     

    For so
long as the default continues such rate of interest shall be recalculated on a
similar basis at the end of each successive period so determined by the
Lender.  Any such interest which is not paid when due shall be
compounded at the end of each such Interest Period or other period determined by
the Lender for so long as it remains unpaid.

     

    
      	
              8.4

            	
              Lender's notification of rate
      of interest

            

    

     

    The
Lender will notify the Borrower of each determination of a rate of interest
under this Agreement and any of the other Security Documents promptly upon the
determination thereof.

     

    
      	
              9.

            	
              PAYMENTS

            

    

     

    
      	
              9.1

            	
              Place of
      payment

            

    

     

    Unless
otherwise specified by the Lender, all moneys to be paid by the Borrower to the
Lender under this Agreement and any of the other Security Documents shall be
paid to the Lender:

     

    
      	
               
      

            	
              9.1.1

            	
              by
      not later than 10.00 a.m. (London
time);

            

    

     

    
      	
               
      

            	
              9.1.2

            	
              on
      their due date in Dollars, in funds which are for same day settlement in
      the New York Clearing House Interbank Payments System (or in such other
      Dollar funds as shall for the time being be customary for settlement of
      international banking transactions in Dollars);
  and

            

    

     

    
      	
               
      

            	
              9.1.3

            	
              to
      the account of the Lender, with Citibank of New York, New York, USA,
      (Swift Code: CITIUS33) under reference "Kronos Shipping I, Ltd.
      US$30,000,000 Loan Agreement" or to such other account as the Lender may
      from time to time notify the
Borrower.

            

    

     

    
      	
              9.2

            	
              Non-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:

     

    
      	
               
      

            	
              9.2.1

            	
              the
      payment or payments due shall be made on the first Banking Day thereafter,
      provided this falls in the same calendar month;
  and

            

    

     

    
      	
               
      

            	
              9.2.2

            	
              if
      it does not, payment shall fall due and be made on the immediately
      preceding Banking Day.

            

    

    
      
         

      

      
        18

        
          

        

      

      
         

      

    

    
      	
              9.3

            	
              Accrual of interest and
      periodic payments

            

    

     

    All
payments of interest and other payments of an annual or periodic nature to be
made by the Borrower shall accrue from day to day and be calculated on the basis
of the actual number of days elapsed and a 360 day year.

     

    
      	
              10.

            	
              NO
      SET-OFF, COUNTERCLAIM OR TAX
DEDUCTION

            

    

     

    
      	
              10.1

            	
              No set-off or
      counterclaim

            

    

     

    All
payments to be made by the Borrower under this Agreement and any of the other
Security Documents shall be made:

     

    
      	
               
      

            	
              10.1.1

            	
              without
      set-off or counterclaim; and

            

    

     

    
      	
               
      

            	
              10.1.2

            	
              free
      and clear of, and without deduction for or on account of, any present or
      future taxes, unless the Borrower is compelled by law to make payment
      subject to any such tax.

            

    

     

    
      	
              10.2

            	
              Gross
  up

            

    

     

    If the
Borrower is compelled by law to make payment subject to such taxes, the Borrower
will:

     

    
      	
               
      

            	
              10.2.1

            	
              promptly
      notify the Lender upon becoming aware of such
  requirement;

            

    

     

    
      	
               
      

            	
              10.2.2

            	
              pay
      the Lender such additional amounts as may be necessary to ensure that the
      Lender receives a net amount equal to the full amount which the Lender
      would have received had such payment not been subject to such taxes;
      and

            

    

     

    
      	
               
      

            	
              10.2.3

            	
              deliver
      to the Lender copies of the receipts from the relevant government
      authority or body evidencing the due and punctual payment of such
      taxes.

            

    

     

    
      	
              10.3

            	
              Tax credit and
      mitigation

            

    

     

    
      	
               
      

            	
              10.3.1

            	
              If
      the Borrower makes a payment to the Lender pursuant to Clause 10.2
      and the Lender has received or been granted a credit against, or relief or
      remission or repayment of, any tax paid or payable by it (a "tax credit")
      which is attributable to that payment or the corresponding payment under
      the Security Documents the Lender shall, to the extent that it can do so
      without prejudice to the retention of the amount of such credit, relief,
      remission or repayment, pay to the Borrower such amount as the Lender
      shall certify (which certificate shall be conclusive in the absence of
      manifest error) to the Borrower to be attributable to such payments and
      which will leave the Lender (after such payment) in no better or worse
      position than it would have been in if the Borrower had not been required
      to make any deduction or withholding. Such payment to the Borrower shall
      be made as soon as reasonably practicable after the amount of such credit,
      relief, remission or repayment has been received by the
      Lender.

            

    

     

    
      	
               
      

            	
              10.3.2

            	
              The
      Lender shall use all reasonable endeavours to avoid the incidence of any
      deduction or withholding by applying for any appropriate relief, waiver or
      exemption from the same, and in addition shall consider in its absolute
      discretion, subject to obtaining any necessary consents and
      authorisations, fulfilling its obligations through another lending office,
      transferring its rights and obligations at par to one or more of its
      affiliates (in each case to be acceptable to the Borrower) if such
      transfer would result in there being no requirement for a deduction or
      withholding.

            

    

    
      
         

      

      
        19

        
          

        

      

      
         

      

    

     

    
      	
              11.

            	
              ACCOUNTS
      OF THE LENDER

            

    

     

    
      	
              11.1

            	
              Lender to open
      accounts

            

    

     

    The
Lender will open and maintain on its books accounts showing the amount owing to
it from the Borrower and the other Obligors and the amounts of all payments of
principal, interest and other moneys falling due and received by
it.

     

    
      	
              11.2

            	
              Conclusiveness of
      entries

            

    

     

    The
Borrower's obligation to repay the Loan or any part thereof, to pay interest
thereon and to pay all other sums due under the Security Documents shall be
conclusively evidenced (in the absence of manifest error) by the entries from
time to time made in the accounts opened and maintained under this
Clause 11.

     

    
      	
              12.

            	
              APPLICATION
      OF RECEIPTS

            

    

     

    
      	
              12.1

            	
              Order of
      application

            

    

     

    Except as
otherwise specifically provided in this Agreement or in any other of the
Security Documents, all moneys received or recovered by the Lender under the
Security Documents will, after discharging the cost (if any) incurred in
collecting such moneys, be applied as follows:

     

    
      	
               
      

            	
              FIRST:

            	
              in
      or towards payment of all moneys expended or liabilities incurred by the
      Lender in respect of all reasonably and properly incurred expenses, fees
      or charges relating to the preparation, completion and registration of the
      Security Documents or in respect of the protection, maintenance or
      enforcement of the security they
create;

            

    

     

    
      	
            	
              SECONDLY:  
      

            	
              in
      or towards the satisfaction of any amounts forming the balance of the
      Outstanding Indebtedness which are then due and payable, whether by reason
      of payment demanded or otherwise, in such order of application as the
      Lender may think fit;

            

    

     

    
      	
            	
              THIRDLY:

            	
              at
      the Lender's discretion, in retention on suspense account of such amount
      as the Lender may consider appropriate to secure the discharge of any part
      of the Outstanding Indebtedness not then due and payable, and, upon the
      same becoming due and payable, in or towards the discharge thereof in
      accordance with the foregoing provisions of this Clause 12.1;
      and

            

    

     

    
      	
            	
              FOURTHLY:

            	
              the
      balance (if any) shall be paid to the Borrower or other person
      entitled.

            

    

     

    
      	
              12.2

            	
              Waiver of right of
      appropriation

            

    

     

    The
Borrower hereby irrevocably waives any rights of appropriation to which it may
be entitled.

     

    
      	
              13.

            	
              RETENTIONS

            

    

     

    
      	
              13.1

            	
              Borrower to open
      Accounts

            

    

     

    The
Borrower shall establish and maintain with the Lender in the name of the
Borrower:

    
      
         

      

      
        20

        
          

        

      

      
         

      

    

     

    
      	
               
      

            	
              13.1.1

            	
              the
      Cash Collateral Account until the payment of the Second Instalment by the
      Guarantor (unless the Borrower procures a guarantee in accordance with
      Clause 4.3.1); and

            

    

     

    
      	
               
      

            	
              13.1.2

            	
              upon
      an Event of Default an account, which shall be designated the "Kronos
      Shipping I, Ltd. Earnings Account" (referred to in this Agreement as the
      "Earnings
      Account").

            

    

     

    
      	
              13.2

            	
              Payment of
      Earnings

            

    

     

    The
Borrower shall procure that following a request by the Lender or an Event of
Default as referred to in 13.1.2, unless and until the Lender shall otherwise
direct, all Earnings shall be paid and credited to the Earnings
Account.

     

    
      	
              13.3

            	
              Application of Earnings and
      Cash Collateral Deposit

            

    

     

    So long
as no Event of Default has occurred and is continuing, any and all moneys
credited to the Earnings Account will be available to the Borrower. During the
Commitment Period in relation to the Guarantee Facility no part of the Cash
Collateral Deposit shall be withdrawn from the Cash Collateral Account without
the prior written consent of the Lender.

     

    
      	
              13.4

            	
              Cash
      Collateral

            

    

     

    The
Borrower shall, on or before the first Issue Date of the Guarantee Facility, pay
into the Cash Collateral Account the Cash Collateral Deposit and the Cash
Collateral Deposit shall be secured in favour of the Lender pursuant to the
Accounts Security until such time as (provided that there is no Event of Default
or Potential Event of Default which has occurred and is continuing) the Second
Instalment is paid by the Borrower or the Borrower procures a guarantee in
accordance with Clause 4.3.1 whereupon the Lender shall release the Cash
Collateral Deposit to the Borrower or to its order.

     

    
      	
              13.5

            	
              Borrower's obligations with
      respect to Earnings Account

            

    

     

    Subject
to Clause 13.1.2, the Borrower will, at the request of the
Lender:

     

    
      	
               
      

            	
              13.5.1

            	
              transfer
      or procure the transfer of any funds credited to the Earnings Account
      specified in Clause 13.1 and pay or procure the payment of any
      Earnings, to such other account or accounts in substitution therefore with
      the Lender or any other bank or with any branch, sub-branch or subsidiary
      of the Lender or any other bank as the Lender may from time to time
      specify; and

            

    

     

    
      	
               
      

            	
              13.5.2

            	
              forthwith
      upon demand do all such acts and things and execute such documents as the
      Lender may reasonably require in order to create security over the
      Earnings Account more effectively to secure the payment of the Outstanding
      Indebtedness.

            

    

     

    The
expression "Earnings
Account" shall include any such account or accounts, whether designated
as such or not, opened by the Borrower at the request of the Lender with the
Lender or any other bank or with any branch, sub-branch or subsidiary of the
Lender or any other bank, as well as any sub-account to which funds in the said
accounts may be allocated from time to time for currency or deposit
purposes.

     

    
      	
              13.6

            	
              Lender's right to
      withhold

            

    

     

    Notwithstanding
anything to the contrary contained in this Agreement, so long as the Borrower
remains under any liability (whether actual or contingent) in respect of the
Outstanding Indebtedness, the Lender shall be entitled to withhold payment (up
to the amount of such actual or contingent liability) of any moneys from time to
time standing to the credit of the Earnings Account and any other accounts for
the time being of the Borrower with the Lender and to refuse payment upon any
negotiable instrument (up to the amount of such actual or contingent
liability).

    
      
         

      

      
        21

        
          

        

      

      
         

      

    

    
      	
              13.7

            	
              Appropriation, after
      default

            

    

     

    On or at
any time after the happening of an Event of Default or a Potential Event of
Default:

     

    
      	
               
      

            	
              13.7.1

            	
              the
      Borrower shall not be entitled to make any further withdrawal from any of
      the Accounts; and

            

    

     

    
      	
               
      

            	
              13.7.2

            	
              the
      Lender shall forthwith become entitled to direct that the Earnings be paid
      to such place and account as the Lender may think fit, and following such
      Event of Default or Potential Event of Default (without prejudice to the
      Lender's rights under Clause 20.2) at any time and without notice to
      the Borrower to appropriate all or any of the moneys standing to the
      credit of the Accounts and any Earnings which may thereafter be received
      by the Lender and apply the same in or towards the discharge of the
      Outstanding Indebtedness in accordance with
  Clause 12.

            

    

     

    
      	
              13.8

            	
              Bank and other
      charges

            

    

     

    All bank,
exchange, telegraph and other charges in connection with the inward and outward
remittance of moneys to and from any of the Accounts shall be for the account of
the Borrower, and the Lender shall be entitled and is hereby irrevocably and
unconditionally authorised to debit the amount of such charges to the account
concerned, as and when such charges are incurred.

     

    
      	
              13.9

            	
              Continuing obligations of
      Borrower

            

    

     

    Nothing
in this Clause 13, whether express or implied, shall relieve the Borrower
of its absolute and unconditional obligations to repay the Loan, to pay interest
thereon and to pay all other sums from time to time due, owing or payable
hereunder and under any of the other Security Documents.

     

    
      	
              13.10

            	
              Interest on moneys on the
      Accounts

            

    

     

    Any
amounts for the time being standing to the credit of each Account (if that
Account is with the Lender) shall earn interest at the rate from time to time
offered by the Lender 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 that Account.

     

    
      	
              14.

            	
              CONDITIONS
      PRECEDENT

            

    

     

    
      	
              14.1

            	
              Conditions to be
      satisfied

            

    

     

    The
Lender will not be obliged to make available any Advance and the Borrower shall
not be entitled to draw down any Advance unless the following conditions
precedent are satisfied or waived in writing in accordance with
Clause 3.2:

     

    
      	
               
      

            	
              14.1.1

            	
              the
      Lender has received a duly completed Notice of Drawdown in respect of that
      Advance;

            

    

     

    
      	
               
      

            	
              14.1.2

            	
              the
      Lender has received payment of the fees and expenses specified in Clause
      21 to the extent due and
payable;

            

    

    
      
         

      

      
        22

        
          

        

      

      
         

      

    

     

    
      	
               
      

            	
              14.1.3

            	
              the
      Lender or its legal advisers have received the documents and evidence
      described in Schedule 3, in form and substance satisfactory to them on or
      before the applicable dates specified in Schedule 3;
  and

            

    

     

    
      	
               
      

            	
              14.1.4

            	
              the
      Lender is satisfied that:

            

    

     

    
      	
               
      

            	
              (a)

            	
              the
      representations and warranties contained in Clause 16 are true and
      correct at the Drawdown Date of that
Advance;

            

    

     

    
      	
               
      

            	
              (b)

            	
              none
      of the circumstances specified in Clauses 22, 23 or 24 is subsisting;
      and

            

    

     

    
      	
               
      

            	
              (c)

            	
              no
      Event of Default or Potential Event of Default has occurred or will arise
      following the making available of that
Advance.

            

    

     

    
      	
              14.2

            	
              Waiver of conditions
      precedent

            

    

     

    If the
Lender in its absolute discretion makes any Advance available notwithstanding
that one or more of the relevant conditions precedent specified above remains
unsatisfied on the applicable Drawdown Date, then the Borrower shall procure the
satisfaction of such condition or conditions precedent within 14 days thereafter
or such longer period as the Lender may in its absolute discretion agree in
writing.

     

    
      	
              15.

            	
              SECURITY

            

    

     

    
      	
              15.1

            	
              Borrower to provide
      security

            

    

     

    As
security for the payment of the Outstanding Indebtedness, the Borrower shall
execute, deliver to, and (where appropriate) register, and, as the case may be,
procure that there is executed, delivered to and (where appropriate) registered,
in favour of the Lender in form and substance satisfactory to the Lender, the
Security Documents set out in Clauses 15.2, 15.3 and 15.4 on or before the
relevant dates specified in those Clauses.

     

    
      	
              15.2

            	
              Security to be provided before
      Issue Request

            

    

     

    The
following Security Documents shall be executed, delivered and (where
appropriate) registered on or before the date on which the Issue Request is
given:

     

    
      	
               
      

            	
              15.2.1

            	
              the
      Accounts Security (unless the Borrower procures a guarantee in accordance
      with Clause 4.3.1).

            

    

     

    
      	
              15.3

            	
              Security to be provided before
      Notice of Drawdown on any
Advance

            

    

     

    The
following Security Documents shall be executed, delivered and (where
appropriate) registered on or before the date on which the Notice of Drawdown
any Advance is given:

     

    
      	
               
      

            	
              15.3.1

            	
              the
      Pre-Delivery Security Assignment;

            

    

     

    
      	
               
      

            	
              15.3.2

            	
              the
      Shares Security;

            

    

     

    
      	
               
      

            	
              15.3.3

            	
              the
      Guarantee.

            

    

    
      
         

      

      
        23

        
          

        

      

      
         

      

    

     

    
      	
              15.4

            	
              Security to be provided on or
      before the Drawdown Date for the Delivery
  Advance

            

    

     

    The
following Security Documents shall be executed, delivered and (where
appropriate) registered on or before the Delivery Date:

     

    
      	
               
      

            	
              15.4.1

            	
              the
      Mortgage;

            

    

     

    
      	
               
      

            	
              15.4.2

            	
              the
      Deed of Covenants;

            

    

     

    
      	
               
      

            	
              15.4.3

            	
              the
      General Assignment; and

            

    

     

    
      	
               
      

            	
              15.4.4

            	
              the
      Approved Manager's Undertaking.

            

    

     

    
      	
              16.

            	
              REPRESENTATIONS
      AND WARRANTIES

            

    

     

    
      	
              16.1

            	
              Date of representations and
      warranties

            

    

     

    The
Borrower represents and warrants that the following matters are true at the date
of this Agreement.

     

    
      	
              16.2

            	
              Existence, powers and
      compliance

            

    

     

    The
Borrower:

     

    
      	
               
      

            	
              16.2.1

            	
              is
      an exempted company duly incorporated with limited liability, validly
      existing and in good standing under the laws of the Cayman
      Islands;

            

    

     

    
      	
               
      

            	
              16.2.2

            	
              has
      full power to own its property and assets and to carry on its business as
      it is now being conducted; and

            

    

     

    
      	
               
      

            	
              16.2.3

            	
              has
      complied with all statutory and other requirements relative to its
      business.

            

    

     

    
      	
              16.3

            	
              Capacity and
      authorisation

            

    

     

    The entry
into and performance by the Borrower of this Agreement and the other Security
Documents and the Underlying Documents are within the corporate powers of the
Borrower and have been duly authorised by all necessary corporate actions and
approvals. In entering into this Agreement and the other Security Documents the
Borrower is acting on its own account and not as agent or nominee of any
person.

     

    
      	
              16.4

            	
              No contravention of laws or
      contractual restrictions

            

    

     

    The entry
into and performance by the Borrower of this Agreement and the other Security
Documents and the Underlying Documents do not and will not:

     

    
      	
               
      

            	
              16.4.1

            	
              contravene
      in any respect any law, regulation or contractual restriction which does,
      or may, bind the Borrower or any of its assets;
  or

            

    

     

    
      	
               
      

            	
              16.4.2

            	
              result
      in the creation or imposition of any Encumbrance (other than a Permitted
      Encumbrance) on any of its assets in favour of any party other than the
      Lender.

            

    

    
      
         

      

      
        24

        
          

        

      

      
         

      

    

     

    
      	
              16.5

            	
              No third party
      Encumbrances

            

    

     

    At the
time of execution of this Agreement and each of the other Security Documents, no
third party will have any Encumbrance (other than a Permitted Encumbrance) on
any asset to which this Agreement or the relevant Security Document
relates.

     

    
      	
              16.6

            	
              Licences and approvals in
      force

            

    

     

    All
licences, authorisations, approvals and consents necessary for the entry into,
performance, validity, enforceability or admissibility in evidence of this
Agreement, the other Security Documents and the Underlying Documents have been
obtained and are in full force and effect, true copies have been delivered to
the Lender and there has been no breach of any condition or restriction imposed
in this respect.

     

    
      	
              16.7

            	
              Validity and
      enforceability

            

    

     

    When duly
executed and delivered, and where applicable registered, each of this Agreement
and the other Security Documents will:

     

    
      	
               
      

            	
              16.7.1

            	
              constitute
      the legal, valid and binding obligations of the Borrower and the other
      Obligors thereto; and

            

    

     

    
      	
               
      

            	
              16.7.2

            	
              will
      create a perfected security interest with the required priority in the
      assets and revenues intended to be covered thereby, enforceable against
      the parties thereto in accordance with their respective
    terms,

            

    

     

    except
insofar as enforcement may be limited by any applicable laws relating to
bankruptcy, insolvency, administration and similar laws affecting creditors'
rights generally.

     

    
      	
              16.8

            	
              Status of Underlying
      Documents

            

    

     

    The
copies of the Underlying Documents in existence at the date of this Agreement
delivered to the Lender before the date of this Agreement are true and complete
copies. The Underlying Documents in existence at the date of this Agreement
constitute legal, valid, binding and enforceable obligations of the parties
thereto in accordance with their respective terms. No amendments or additions to
such Underlying Documents have been agreed nor has any party thereto waived any
of its respective rights under any of the Underlying Documents.

     

    
      	
              16.9

            	
              No breach or
      default

            

    

     

    The
Borrower is not:

     

    
      	
               
      

            	
              16.9.1

            	
              in
      material breach of any law, governmental directive, guideline or policy
      statement, whether having the force of law or not;
  or

            

    

     

    
      	
               
      

            	
              16.9.2

            	
              in
      default under any agreement to which it is party or by which it may be
      bound.

            

    

     

    
      	
              16.10

            	
              No litigation current or
      pending

            

    

     

    No
litigation, arbitration, tax claim or administrative proceeding is current or
pending or (to the knowledge of the Borrower) threatened, which, if adversely
determined, would have a materially detrimental effect on the financial
condition of the Borrower.

    
      
         

      

      
        25

        
          

        

      

      
         

      

    

     

    
      	
              16.11

            	
              No
    default

            

    

     

    No
continuing Event of Default or Potential Event of Default has
occurred.

     

    
      	
              16.12

            	
              Choice of law and
      jurisdiction

            

    

     

    The
choice of English law to govern this Agreement and the other Security Documents
and the submission by the Borrower to the jurisdiction of the English courts is
valid and binding, and the Borrower is not entitled to claim any immunity in
relation to itself or its assets under any law or in any jurisdiction in
connection with any legal proceedings, set-off or counterclaim relating to this
Agreement or the other Security Documents or in connection with the enforcement
of any judgement or order arising from such proceedings.

     

    
      	
              16.13

            	
              Truth of financial and other
      information

            

    

     

    The
financial and other information supplied to the Lender by or on behalf of the
Borrower or any other Obligor in connection with the negotiation and the
preparation of this Agreement or delivered to the Lender pursuant to this
Agreement is true and accurate in all material respects when given, and does not
contain any material misstatement of fact or omit any material
fact.

     

    
      	
              16.14

            	
              No deterioration of financial
      condition

            

    

     

    The
Borrower's financial condition has not suffered any material deterioration since
that condition was last disclosed to the Lender.

     

    
      	
              16.15

            	
              No liability to deduction or
      withholding

            

    

     

    All
payments to be made by the Borrower under this Agreement and the other Security
Documents may be made free and clear of and without deduction or withholding for
or on account of any taxes, and neither this Agreement nor any of the other
Security Documents is liable to any registration charge or any stamp,
documentary or similar taxes imposed by any authority, including without
limitation, in connection with the admissibility in evidence of any
thereof.

     

    
      	
              16.16

            	
              No established place of
      business in United Kingdom

            

    

     

    The
Borrower does not have an established place of business in any part of the
United Kingdom or the United States of America or in any other jurisdiction
which would require any of the Security Documents to be filed or registered in
that jurisdiction to ensure its validity or enforceability.

     

    
      	
              16.17

            	
              Pari passu
      obligations

            

    

     

    The
Borrower's obligations under this Agreement and the other Security Documents
will rank at least pari passu with all of its other unsecured and unsubordinated
obligations and liabilities from time to time outstanding other than as
preferred by statute.

     

    
      	
              16.18

            	
              Ownership of
      Borrower

            

    

     

    The
Borrower has an authorised share capital of $50,000 consisting of 50,000 shares
of a par value of $1.00 each of which one (1) share of a par value of $1.00 has
been issued fully paid and is wholly owned, legally and beneficially by the
Shareholder.

    
      
         

      

      
        26

        
          

        

      

      
         

      

    

    
      	
              16.19

            	
              No commissions or
      rebates

            

    

     

    There are
no commissions, rebates, premiums or other payments by or to or for the account
of any Obligor, its shareholders or directors in connection with the
transactions contemplated by this Agreement, other than as disclosed to the
Lender in writing.

     

    
      	
              16.20

            	
              Money
      Laundering

            

    

     

    Any
borrowing by the Borrower or other Obligor and the performance of its
obligations hereunder or under the Security Documents and under the other
Security Documents to which it is a party will be for its own account and will
not involve any breach by it of any law or regulatory measure relating to money
laundering as defined in Article 1 of the Directive (91/308/EEC) of the Council
of the European Communities or any equivalent law or regulatory measure in any
other jurisdiction.

     

    
      	
              16.21

            	
              Environmental
      matters

            

    

     

    Except as
may have been disclosed by the Borrower in writing to, and acknowledged in
writing by, the Lender:

     

    
      	
               
      

            	
              16.21.1

            	
              the
      Borrower and other Obligors and, to the best of the Borrower's knowledge
      and belief (having made due enquiry), their respective Environmental
      Affiliates have complied with the provisions of all Environmental
      Laws;

            

    

     

    
      	
               
      

            	
              16.21.2

            	
              the
      Borrower and the other Obligors and, to the best of the Borrower's
      knowledge and belief (having made due enquiry), their respective
      Environmental Affiliates have obtained all Environmental Approvals and are
      in compliance with all such Environmental
  Approvals;

            

    

     

    
      	
               
      

            	
              16.21.3

            	
              neither
      the Borrower nor any other Obligor nor, to the best of the Borrower's
      knowledge and belief (having made due enquiry), any of their respective
      Environmental Affiliates has received notice of any Environmental Claim
      that alleges that the Borrower or any other Obligor or any such
      Environmental Affiliate is not in compliance with any Environmental Law or
      any Environmental Approval;

            

    

     

    
      	
               
      

            	
              16.21.4

            	
              there
      is no Environmental Claim pending or, to the best of the Borrower's
      knowledge and belief (having made due enquiry), threatened against the
      Borrower or any other Obligor or any Relevant Ship or, to the best of the
      Borrower's knowledge and belief (having made due enquiry), any of their
      respective Environmental Affiliates;
and

            

    

     

    
      	
               
      

            	
              16.21.5

            	
              no
      Environmental Incident which could give rise to any Environmental Claim
      has occurred.

            

    

     

    
      	
              16.22

            	
              Status of
      Vessel

            

    

     

    In
relation to the Vessel and on the Delivery Date the Vessel will be:

     

    
      	
               
      

            	
              16.22.1

            	
              accepted
      by the Guarantor as being in all respects in compliance with the
      provisions of the Building
Contract;

            

    

     

    
      	
               
      

            	
              16.22.2

            	
              in
      the absolute ownership of the Guarantor as the sole, legal and beneficial
      owner free from all Encumbrances save for Permitted
      Encumbrances;

            

    

     

    
      	
               
      

            	
              16.22.3

            	
              duly
      registered under the approved Flag State in the sole ownership of the
      Guarantor;

            

    

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              16.22.4

            	
              in
      compliance with all applicable laws, regulations and requirements
      (statutory or otherwise) applicable to ships registered under the approved
      Flag State and engaged in the service in which the Vessel is or is to be
      engaged;

            

    

     

    
      	
               
      

            	
              16.22.5

            	
              operationally
      seaworthy and in every way fit for
service;

            

    

     

    
      	
               
      

            	
              16.22.6

            	
              classed
      with the Classification Society with the highest possible notation for
      such type of vessel and with its classification free from all
      recommendations, qualifications, requirements, notations and average
      damage;

            

    

     

    
      	
               
      

            	
              16.22.7

            	
              managed
      by the Approved Manager on the terms of the Approved Management Agreement;
      and

            

    

     

    
      	
               
      

            	
              16.22.8

            	
              insured
      in accordance with the provisions of the relevant Security Documents, and
      all requirements relating to the Insurances and the noting of the Lender's
      interest thereon will have been
satisfied.

            

    

     

    
      	
              16.23

            	
              Continuing nature of
      representations and
warranties

            

    

     

    The
Borrower agrees that the representations set out in this Clause 16 shall
survive the execution of this Agreement and shall be deemed to be repeated on
each Drawdown Date and on each Interest Date with reference to the facts and
circumstances then subsisting, as if made on such date.

     

    
      	
              17. 

            	
              UNDERTAKINGS
      OF THE BORROWER

            

    

     

    
      	
              17.1

            	
              Duration of
      undertakings

            

    

     

    The
Borrower shall comply with the undertakings contained in this Clause 17
which shall remain in force from the date of this Agreement to the end of the
Security Period.

     

    
      	
              17.2

            	
              General
      undertakings

            

    

     

    The
Borrower shall:

     

    
      	
               
      

            	
              17.2.1

            	
              perform
      and observe the several covenants and obligations imposed upon it under
      the Security Documents;

            

    

     

    
      	
               
      

            	
              17.2.2

            	
              without
      affecting its obligations under the applicable provisions of the Security
      Documents, perform and observe its obligations under the Underlying
      Documents and use its best endeavours to procure that each of the other
      parties to the Underlying Documents performs and observes its obligations
      thereunder;

            

    

     

    
      	
               
      

            	
              17.2.3

            	
              subject
      to Clause 13.1.2, ensure that the Earnings of the Vessel are paid,
      and that the persons from whom the Earnings are from time to time due are
      instructed to pay them, to the Earnings Account, unless and until the
      Lender shall otherwise direct;

            

    

     

    
      	
               
      

            	
              17.2.4

            	
              inform
      the Lender promptly of any litigation, arbitration, tax claim or
      administrative proceeding instituted or (to its knowledge) threatened and
      of any other occurrence of which it becomes aware which might materially
      adversely affect:

            

    

     

    
      
        	
              	
                (a)

              	
                its
      ability, or the ability of any other Obligor, to perform its obligations
      under the Security
Documents;_or

              

      

    

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

    

     

    
      
        	
              	
                (b)

              	
                the
      security constituted by the Security
Documents;

              

      

    

     

    
      	
               
      

            	
              17.2.5

            	
              maintain
      its corporate existence as a corporation duly organised, validly existing
      and in good standing in its place of
  incorporation;

            

    

     

    
      	
               
      

            	
              17.2.6

            	
              obtain
      and maintain in force all licences, authorisations, approvals and
      consents, and do all other acts and things, which may from time to time be
      necessary or desirable for the continued due performance of its
      obligations under the Security Documents or which may be required for the
      validity, enforceability or admissibility in evidence of the Security
      Documents and the Underlying
Documents;

            

    

     

    
      	
               
      

            	
              17.2.7

            	
              ensure
      that its obligations under the Security Documents rank at least pari passu
      with all its other present, future and/or contingent unsecured and
      unsubordinated obligations;

            

    

     

    
      	
               
      

            	
              17.2.8

            	
              conduct
      its business in a proper and efficient manner and not change the nature,
      organisation or conduct of its business or conduct any business other than
      that previously notified to the
Lender;

            

    

     

    
      	
               
      

            	
              17.2.9

            	
              promptly
      after the happening of any Event of Default or a Potential Event of
      Default, notify the Lender of such event and of the steps (if any) which
      are being taken to remedy it;

            

    

     

    
      	
               
      

            	
              17.2.10

            	
              pay
      all taxes, assessments and other governmental charges as they fall due,
      except to the extent that it is contesting the same in good faith by
      appropriate proceedings and has set aside adequate reserves for their
      payment if such proceedings fail;

            

    

     

    
      	
               
      

            	
              17.2.11

            	
              keep
      proper books of account in respect of its business in accordance with
      generally accepted accounting principles consistently applied and whenever
      so requested by the Lender make the same available for inspection by or on
      behalf of the Lender upon reasonable
notice;

            

    

     

    
      	
               
      

            	
              17.2.12

            	
              provide
      the Lender:

            

    

     

    
      
        	
              	
                (a)

              	
                within
      180 days of the end of each of its financial years with certified copies
      of the consolidated audited financial statements of the Borrower and the
      Shareholder prepared in a form consistent with generally accepted
      accounting principles and practices consistently applied and audited by
      auditors previously approved in writing by the Lender;
  and

              

      

    

     

    
      
        	
              	
                (b)

              	
                within
      3 months after the date thereof with certified copies of all its interim
      accounts and financial statements which should in the normal course be
      made available to its
shareholders;

              

      

    

     

    
      	
               
      

            	
              17.2.13

            	
              provide
      the Lender with such other financial and other information concerning
      itself and its affairs and the Vessel as the Lender may from time to time
      reasonably require, including (but without limitation) full information
      regarding the employment, condition, geographical position, crewing and
      engagements of the Vessel and particulars of all contracts concerning the
      Vessel;

            

    

     

    
      	
               
      

            	
              17.2.14

            	
              provide
      the Lender with any information requested by it pursuant to any anti-money
      laundering legislation, regulation or procedures applicable to the Lender
      from time to time, to the extent required to ensure compliance by the
      Lender;

            

    

     

    
      
        
        

      

      
        29

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              17.2.15

            	
              (if
      the Lender considers that its financial position or prospects are
      deteriorating), give independent auditors appointed to carry out an audit
      and inspection of its affairs every assistance in that
    regard;

            

    

     

    
      	
               
      

            	
              17.2.16

            	
              promptly,
      at the reasonable request of the Lender from time to time, provide the
      Lender with a certificate signed by its chief financial officer or chief
      executive officer confirming that it is, as at the date of such
      certificate, in compliance with its obligations under the Security
      Documents and that no Event of Default or Potential Event of Default has
      occurred, or, if any has occurred, none is
  continuing;

            

    

     

    
      	
               
      

            	
              17.2.17

            	
              procure
      that the Vessel is managed only by the Approved Manager on the terms of
      the Approved Management Agreement and procure that the Guarantor shall not
      without the prior written consent of the Lender to terminate such
      appointment or to appoint any other managers of the
  Vessel;

            

    

     

    
      	
               
      

            	
              17.2.18

            	
              procure
      that the Guarantor shall maintain at all times organisation and personnel
      which are in the opinion of the Lender adequate to provide sufficient
      management, agency, financial, secretarial and other services for the
      Vessel;

            

    

     

    
      	
               
      

            	
              17.2.19

            	
              if
      the Vessel is time chartered for a period which exceeds, or which by
      virtue of any optional extensions might exceed, twelve (12) months'
      duration, procure that the Guarantor shall execute a specific assignment
      in favour of the Lender of all the Guarantor's rights, title and interest
      in and to each and any such time charter, in such form as the Lender shall
      (acting reasonably) approve or require, and do all such acts and things as
      the Lender (acting reasonably) may require to perfect the security
      constituted by such assignment;

            

    

     

    
      	
               
      

            	
              17.2.20

            	
              ensure
      that from the Delivery Date of the Vessel throughout the Security Period
      it shall maintain a minimum liquidity in available cash or cash equivalent
      in the amount of not less than
$1,000,000;

            

    

     

    
      	
               
      

            	
              17.2.21

            	
              ensure
      that the beneficial owner of the Borrower remains the
      Shareholder;

            

    

     

    
      	
               
      

            	
              17.2.22

            	
              comply,
      and procure compliance by the Approved Manager of the Vessel,
      with:

            

    

     

    
      
        	
              	
                (a)

              	
                all
      provisions of The International Management Code for the Safe Operation
      of  Ships and for Pollution Prevention (as adopted by the
      International Maritime Organisation as Resolutions A.741(18) and A.913(22)
      (as amended, supplemented or replaced from time to time, the "ISM Code")) including,
      without limitation, obtaining and maintaining in force at all times a
      valid Document of Compliance in relation to itself and a valid Safety
      Management Certificate in respect of the Vessel as required by the ISM
      Code; and

              

      

    

     

    
      
        	
              	
                (b)

              	
                all
      provisions of The International Ship and Port Facility Security Code (as
      adopted by the International Maritime Organization (as amended,
      supplemented or replaced from time to time, the "ISPS Code")), including,
      without limitation, obtaining and maintaining in force a valid
      International Ship Security Certificate in respect of the Vessel as
      required by the ISPS Code, and ensuring that the Vessel's security system
      and its associated security equipment comply with the applicable
      requirements of Part A of the ISPS Code and of Chapter XI-2 of the Safety
      of Life at Sea Convention (SOLAS), and that an approved ship security plan
      is in place.

              

      

       

      
        
          
          

        

        
          30

          
            

          

        

        
          
          

        

      

    

     

    
      	
              17.3

            	
              Consent of Lender
      required

            

    

     

    The
Borrower shall not without the prior consent of the Lender:

     

    
      	
               
      

            	
              17.3.1

            	
              except
      as contemplated by this Agreement, convey, assign, transfer, sell or
      otherwise dispose of or deal with any of its real or personal property,
      assets or rights, whether present or
future;

            

    

     

    
      	
               
      

            	
              17.3.2

            	
              create
      or permit to exist any Encumbrance (other than a Permitted Encumbrance)
      over any part of its undertaking, property, assets or rights, whether
      present or future (provided that where any such Encumbrance arises in the
      ordinary course of business, the Borrower shall promptly discharge the
      same);

            

    

     

    
      	
               
      

            	
              17.3.3

            	
              incur
      any Financial Indebtedness or other liability or obligation
      except:

            

    

     

    
      
        	
              	
                (a)

              	
                under
      this Agreement and the other Security
Documents;

              

      

    

     

    
      
        	
              	
                (b)

              	
                arising
      under the Underlying Documents;
or

              

      

    

     

    
      
        	
              	
                (c)

              	
                arising
      in the ordinary course of operating and chartering the
    Vessel;

              

      

    

     

    
      
        	
              	
                (d)

              	
                arising
      out of shareholders' loans provided always that such loans are fully
      subordinated to the rights of the Lender under this Agreement and the
      Security Documents.

              

      

    

     

    
      	
               
      

            	
              17.3.4

            	
              waive
      or fail to enforce any provision of, or agree to any material amendment or
      supplement to, the Underlying
Documents;

            

    

     

    
      	
               
      

            	
              17.3.5

            	
              issue
      any further shares or register any transfer of any of its shares, or admit
      any new member, whether by subscription or
  transfer;

            

    

     

    
      	
               
      

            	
              17.3.6

            	
              consolidate,
      amalgamate or merge with any other
entity;

            

    

     

    
      	
               
      

            	
              17.3.7

            	
              form
      or acquire any subsidiary;

            

    

     

    
      	
               
      

            	
              17.3.8

            	
              alter
      or extend its financial year for the purposes of the preparation of its
      accounts, or change its auditors;

            

    

     

    
      	
               
      

            	
              17.3.9

            	
              alter
      any of the provisions of its memorandum or articles of association or
      other constitutional documents;

            

    

     

    
      	
               
      

            	
              17.3.10

            	
              make
      any loans or advances to, or any investments in, any person (including,
      without limitation, any officer, director, shareholder, employee or
      customer of the Borrower);

            

    

     

    
      	
               
      

            	
              17.3.11

            	
              except
      as contemplated by this Agreement, assume, guarantee or endorse, or
      otherwise become or remain liable for, any obligation of any other
      person;

            

    

     

    
      	
               
      

            	
              17.3.12

            	
              authorise
      or accept any capital commitment;

            

    

     

    
      	
               
      

            	
              17.3.13

            	
              make
      any payment of principal or interest to any of its shareholders in respect
      of any loans or loan capital made available to it by its
      shareholders;

            

    

     

    
      
        
        

      

      
        31

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              17.3.14

            	
              declare
      or pay any dividends upon any of its shares or otherwise distribute any
      assets to any of its shareholders whether in cash or otherwise (such
      consent not to be unreasonably
withheld);

            

    

     

    
      	
               
      

            	
              17.3.15

            	
              assign,
      novate or in any way transfer or dispose of any of its rights or
      obligations or any amount payable by or to it under or pursuant to the
      Master Agreement or enter into any interest rate exchange or hedging
      agreement with anyone other than the Lender, or enter into any other
      agreement or commitment the effect of which is, in the opinion of the
      Lender, materially to prejudice the hedging of the Borrower's interest
      rate risk effected by the transactions from time to time entered into
      between the Borrower and the
Lender;

            

    

     

    
      	
               
      

            	
              17.3.16

            	
              consolidate
      or subdivide or alter any of the rights attached to, or reduce, any of its
      share capital, or capitalise, repay or otherwise distribute any amount
      outstanding to the credit of any capital or revenue reserves, redeem any
      of its share capital in any way or enter into any arrangement with its
      creditors; or

            

    

     

    
      	
               
      

            	
              17.3.17

            	
              permit
      any changes to be made in the identity of its directors, officers or
      senior management personnel.

            

    

     

    
      	
              18. 

            	
              REVIEW
      OF INSURANCES

            

    

     

    
      	
              18.1

            	
              Consultation of insurance
      advisers

            

    

     

    The
Lender shall be entitled, at any time and from time to time, to consult
insurance advisers on any matter relating to the Insurances (including, without
limitation, the terms, amounts and quality of the Insurances and the status of
any insurance claims), and the Borrower shall procure that there is delivered to
such advisers any and all such information concerning the Vessel and the
Insurances as the Lender may require. The reasonable costs and expenses of any
such insurance advisers shall be for the account of the Borrower and be payable
on demand.

     

    
      	
              18.2

            	
              Modification of
      Insurances

            

    

     

    If, in
the opinion of the Lender (acting reasonably), by reason of a significant change
in circumstances after the date of this Agreement (such changes in circumstances
to include, without limitation, changes in the availability or cost of insurance
coverage or in generally accepted industry practice) the Insurances do not
provide the Lender with good and adequate security, the Lender may from time to
time notify the Borrower of any proposed modification of the requirements of the
Security Documents relating to Insurances which the Lender may consider
appropriate in the circumstances. Such modification may (without limitation)
require the Borrower to place, or procure the placing of, further and additional
insurances and/or to amend or procure the amendment of the existing Insurances,
whether through the existing brokers or otherwise. Any such modification shall
take effect as an amendment to the Security Documents on and from the date on
which it is notified in writing to the Borrower and shall bind the Borrower
accordingly.

     

    
      	
              19. 

            	
              VALUATIONS
      AND ASSET PROTECTION

            

    

     

    
      	
              19.1

            	
              Arrangement of
      valuations

            

    

     

    The
Lender may twice a year or at any time on an Event of Default arrange for
valuations of the Vessel and the Building Contract to be carried out in order to
determine the Appraised Market Value of the Vessel or the Building Contract in
accordance with the following provisions of this Clause 19.

     

    
      
        
        

      

      
        32

        
          

        

      

      
        
        

      

    

     

    
      	
              19.2

            	
              Basis of
      valuations

            

    

     

    Such
valuations shall be prepared:

     

    
      	
               
      

            	
              19.2.1

            	
              with
      or without a physical inspection of the Vessel, at the discretion of the
      Lender;

            

    

     

    
      	
               
      

            	
              19.2.2

            	
              in
      Dollars on the basis of a sale for prompt delivery, charter-free, at arm's
      length between a willing seller and a willing
  buyer;

            

    

     

    
      	
               
      

            	
              19.2.3

            	
              by
      two independent first-class international sale and purchase shipbrokers or
      valuers one of whom shall be nominated by the Borrower and approved by the
      Lender and the other shall be nominated by the Lender, provided however
      that if the valuations of the two shipbrokers or valuers so appointed
      differ by a margin of ten per cent. (10%) or more the Borrower or the
      Lender may instruct such shipbrokers or valuers jointly to appoint and
      employ a third independent first-class international sale and purchase
      shipbroker or valuer to provide a third valuation;
  and

            

    

     

    
      	
               
      

            	
              19.2.4

            	
              at
      the cost of the Borrower.

            

    

     

    
      	
              19.3

            	
              Appraised Market
      Value

            

    

     

    The
Appraised Market Value of the Vessel or the Building Contract shall be
determined by taking the mean average of the valuations.

     

    
      	
              19.4

            	
              Consequences of security
      shortfall

            

    

     

    Prior to
the Delivery Advance, if the aggregate of (i) the Appraised Market Value of the
Building Contract and (ii) the market value, as determined by the Lender, of any
additional security previously provided under this Clause 19 is at any time
less than 115% of the Loan; or following the Delivery Advance if the aggregate
of (i) the Appraised Market Value of the Vessel and (ii) the market value, as
determined by the Lender, of any additional security previously provided under
this Clause 19 is at any time less than 125% of the Loan, then the Borrower
shall, within 30 days of a demand by the Lender to that effect
either:

     

    
      	
               
      

            	
              19.4.1

            	
              provide
      additional security over such assets and in such form as is acceptable to
      the Lender (acting reasonably) which have a market value as determined by
      the Lender (acting reasonably) at least equal to the shortfall;
      or

            

    

     

    
      	
               
      

            	
              19.4.2

            	
              prepay
      such part of the Loan as will eliminate the shortfall in accordance with
      the relevant provisions of
Clause 6.3.

            

    

     

    
      	
              19.5

            	
              Valuation of additional
      security

            

    

     

    The
market value of any additional security provided or to be provided under this
Clause 19 shall be determined by valuers appointed by, and on a basis
acceptable to, the Lender.

     

    
      	
              19.6

            	
              Valuation
      conclusive

            

    

     

    Any
valuation prepared under this Clause 19 shall be conclusive and binding on
the Borrower.

     

    
      
        
        

      

      
        33

        
          

        

      

      
        
        

      

    

     

    
      	
              19.7

            	
              Costs of
      valuation

            

    

     

    The
Borrower shall pay the reasonably and properly incurred costs, fees and expenses
of any shipbroker or valuer in connection with any valuation prepared under this
Clause 19.

     

    
      	
              19.8

            	
              Assistance

            

    

     

    The
Borrower shall provide such assistance as the Lender shall require in connection
with any valuation prepared under this Clause 19.

     

    
      	
              20. 

            	
              EVENTS
      OF DEFAULT

            

    

     

    
      	
              20.1

            	
              Defaults

            

    

     

    There
shall be an Event of Default if any one or more of the following
happen:

     

    
      	
               
      

            	
              20.1.1

            	
              the
      Borrower fails to make any payment due under any of the Security Documents
      within five (5) days of its due date, or, in respect of moneys payable on
      demand, (unless otherwise specifically provided) within ten (10) days from
      the date of such demand;

            

    

     

    
      	
               
      

            	
              20.1.2

            	
              the
      Borrower is in breach of any of the provisions of Clauses 17.2.3, 17.2.5,
      17.3 or 19.4 or any one or more of the provisions of the Security
      Documents relating to the
Insurances;

            

    

     

    
      	
               
      

            	
              20.1.3

            	
              the
      Borrower fails to observe or perform any provision of the Security
      Documents other than those referred to in Clauses 20.1.1 and 20.1.2 and
      either, in the opinion of the Lender, such default is not remediable or,
      in the case of any such default which the Lender considers capable of
      remedy, such default continues for a period of seven (7) days after the
      Lender, by notice to the Borrower, requires the same to be
      remedied;

            

    

     

    
      	
               
      

            	
              20.1.4

            	
              any
      licence, approval, consent, authorisation or registration at any time
      necessary or desirable for the validity, enforceability or admissibility
      in evidence of the Security Documents, or for the Borrower to comply with
      its obligations thereunder, or in connection with the ownership or
      operation of the Vessel, is revoked, withheld or expires, or is modified
      in what the Lender considers a material
respect;

            

    

     

    
      	
               
      

            	
              20.1.5

            	
              the
      Vessel becomes a Total Loss and (without prejudice to the Borrower's
      obligations under Clause 6.2) the Lender does not receive, within 90
      days following the Total Loss Date, the insurance proceeds relating to the
      Total Loss in an amount not less than the amount for which the Vessel is
      required to be insured under the Security Documents as at the Total Loss
      Date or, if lower, the amount of the Outstanding Indebtedness at the date
      of receipt by the Lender;

            

    

     

    
      	
               
      

            	
              20.1.6

            	
              a
      petition is filed, or an order made, or an effective resolution passed,
      for the compulsory or voluntary winding-up, liquidation or dissolution of
      the Borrower (other than for the purposes of amalgamation or
      reconstruction in respect of which the prior written consent of the Lender
      has been obtained) or any proceedings analogous to winding-up proceedings
      are begun in any jurisdiction in relation to the Borrower or if the
      Borrower suspends payment of, or is unable to or admits inability to pay,
      its debts as they fall due or makes any special arrangement or composition
      with creditors generally or any class of its
  creditors;

            

    

     

    
      
        
        

      

      
        34

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              20.1.7

            	
              an
      administrator, administrative receiver, liquidator, receiver or trustee or
      similar official is appointed of the whole, or what the Lender considers a
      material part, of the property, assets or undertaking of the Borrower or
      if the Borrower applies for, or consents to, any such
      appointment;

            

    

     

    
      	
               
      

            	
              20.1.8

            	
              any
      step is taken (including, without limitation, the making of any
      application or the giving of any notice) by the Borrower or by any other
      person to appoint an administrator in respect of the
    Borrower;

            

    

     

    
      	
               
      

            	
              20.1.9

            	
              an
      encumbrancer takes possession of, or distress or execution is levied upon,
      the whole, or what the Lender considers a material part, of the property,
      assets or undertaking of the
Borrower;

            

    

     

    
      	
               
      

            	
              20.1.10

            	
              the
      Borrower ceases, or threatens to cease, to carry on its business, or
      disposes or threatens to dispose of what the Lender considers a material
      part of its properties, assets or undertakings, or such a part is seized,
      nationalised, appropriated or compulsorily purchased by or under the
      authority of any government;

            

    

     

    
      	
               
      

            	
              20.1.11

            	
              anything
      is done, suffered or omitted to be done or occurs which, in the opinion of
      the Lender, would in any way imperil the security created by the Security
      Documents;

            

    

     

    
      	
               
      

            	
              20.1.12

            	
              an
      event of default or event of termination occurs in relation to any
      obligation whatsoever of the Borrower in respect of Financial
      Indebtedness, whether such obligation is to the Lender or any other
      person, or any guarantee or indemnity given by the Borrower is not
      honoured when called;

            

    

     

    
      	
               
      

            	
              20.1.13

            	
              any
      representation or warranty made or deemed to be made in any of the
      Security Documents or Underlying Documents, or in any certificate or
      statement delivered in connection with any of the Security Documents or
      Underlying Documents or in the negotiations leading up to the conclusion
      of this Agreement is, or at any time becomes, incorrect in any respect
      which the Lender considers materially adverse to the Lender and is not
      remedied within fourteen (14) days, as if such representation or warranty
      were made as of such time;

            

    

     

    
      	
               
      

            	
              20.1.14

            	
              the
      Borrower ceases to be a company duly registered in good standing in the
      place in which it was incorporated;

            

    

     

    
      	
               
      

            	
              20.1.15

            	
              without
      the prior written consent of the Lender there is any change in the legal
      or beneficial ownership of the shares of the
  Borrower;

            

    

     

    
      	
               
      

            	
              20.1.16

            	
              in
      the opinion of the Lender there is any material adverse change in the
      financial condition or prospects of the
  Borrower;

            

    

     

    
      	
               
      

            	
              20.1.17

            	
              any
      of the events specified in Clauses 20.1.1 to 20.1.17 inclusive occurs
      (mutatis mutandis) in relation to any other
  Obligor;

            

    

     

    
      	
               
      

            	
              20.1.18

            	
              any
      event occurs or proceeding is taken in relation to the Borrower or any
      other Obligor in any jurisdiction which has an effect equivalent or
      similar to any of the events specified in Clauses 20.1.6 to 20.1.8
      inclusive;

            

    

     

    
      	
               
      

            	
              20.1.19

            	
              the
      registration of the Vessel under the laws and flag of its approved Flag
      State is cancelled or terminated without the prior written consent of the
      Lender;

            

    

     

    
      
        
        

      

      
        35

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              20.1.20

            	
              any
      licence, approval, consent, authorisation or registration at any time
      necessary or desirable for the validity, enforceability or admissibility
      in evidence of any of the Underlying Documents, or for any of the parties
      thereto to comply with its obligations thereunder, is revoked, withheld or
      expires, or is modified in what the Lender considers a material
      respect;

            

    

     

    
      	
               
      

            	
              20.1.21

            	
              it
      becomes impossible or unlawful for any party to any of the Underlying
      Documents to fulfil any of its obligations under, or to exercise any
      rights vested in it by any of the Underlying Documents or any of the
      Underlying Documents is breached in any material respect by any party
      thereto or is terminated or for any reason becomes invalid or
      unenforceable or otherwise ceases to be in full force and effect or any
      party thereto repudiates or threatens to repudiate any of the Underlying
      Documents;

            

    

     

    
      	
               
      

            	
              20.1.22

            	
              the
      Vessel is not delivered to and accepted by the Guarantor in accordance
      with the provisions of the Building
Contract;

            

    

     

    
      	
               
      

            	
              20.1.23

            	
              any
      event of default (as so described in any other of the Security Documents)
      occurs; or

            

    

     

    
      	
               
      

            	
              20.1.24

            	
              the
      Borrower, any other Obligor and/or any Environmental Affiliate fails to
      comply with any Environmental Law or any Environmental Approval or the
      Vessel or any other Relevant Ship is involved in any incident which gives
      rise or may give rise to an Environmental Claim if, in any such case, such
      non-compliance or incident or the consequences thereof would, in the
      opinion of the Lender, have a material adverse effect on the business,
      assets, operations, property or financial condition of the Borrower or any
      other Obligor or on the security constituted by any of the Security
      Documents.

            

    

     

    
      	
              20.2

            	
              Lender's
      remedies

            

    

     

    Upon the
occurrence of an Event of Default and at any time thereafter without prejudice
to any of the rights and remedies of the Lender under any of the other Security
Documents or otherwise the Lender may take any one or more of the following
actions:

     

    
      	
               
      

            	
              20.2.1

            	
              by
      written notice to the Borrower declare its commitment to advance the Loan
      and the Master Agreement cancelled, whereupon the same shall be
      cancelled;

            

    

     

    
      	
               
      

            	
              20.2.2

            	
              by
      written notice to the Borrower demand the immediate repayment of the Loan,
      all interest accrued thereon and all other Outstanding Indebtedness;
      whereupon the same shall become immediately due and payable;
      and

            

    

     

    
      	
               
      

            	
              20.2.3

            	
              (if
      any Bank Guarantee has then been issued and is outstanding) by written
      notice to the Borrower demand that the
Borrower:

            

    

     

    
      	
               
      

            	
              20.2.4

            	
              give
      the Lender cash cover for all or (if the Lender so specifies) part of the
      amount of the Bank Guarantee Liabilities;
and/or

            

    

     

    
      	
            	
              20.2.5

            	
              put
      the Lender in funds to make a payment which the Issuing Bank is then
      authorised by this Agreement to make in connection with the Bank Guarantee
      Liabilities; and/or

            

    

    
      
         

      

      
        36

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              20.2.6

            	
              execute
      such documents as the Lender may require in order to create or perfect in
      the Lender's favour a restriction on withdrawal or repayment of any amount
      paid by the Borrower under this Clause 21.2 and/or a security in or
      over such amount, in each case to secure or support the Borrower's
      liabilities to the Lender under this
Agreement;

            

    

     

    
      	
               
      

            	
              20.2.7

            	
              take
      steps to exercise the rights and remedies conferred upon the Lender by
      this Agreement and the other Security Documents and exercisable on or
      after the occurrence of an Event of
Default.

            

    

     

    
      	
              21.

            	
              FEES,
      EXPENSES AND INDEMNITIES

            

    

     

    
      	
              21.1

            	
              Fees

            

    

     

    The
Borrower shall pay to the Lender:

     

    
      	
               
      

            	
              21.1.1

            	
              an
      arrangement fee of $120,000, such arrangement fee being agreed to having
      been earned on acceptance by the Borrower of the Lender's commitment
      letter dated 9 July 2008;

            

    

     

    
      	
               
      

            	
              21.1.2

            	
              in
      relation to each Advance and the Guarantee Facility, a commitment fee at
      the rate of 0.3% per annum on the daily undrawn amount of such Advance and
      the daily unutilised amount of the Guarantee Facility from and including
      the date of this Agreement to and including the date of payment, such fee
      to be payable by the Borrower quarterly in arrears and on the last day of
      the Commitment Period applicable to such Advance and/or the Guarantee
      Facility;

            

    

     

    
      	
               
      

            	
              21.1.3

            	
              guarantee
      commission quarterly in arrears at an annual rate equal to 1.4% per annum
      on the daily average maximum amount of the Bank Guarantee Liabilities in
      relation to the relevant period. The first period in respect of which such
      guarantee commission shall be calculated will be the period from the Issue
      Date of the first Bank Guarantee up to the next quarter date; thereafter
      the guarantee commission shall be calculated for each of the following
      consecutive periods of 3 months respectively in each year with a final
      instalment being calculated in respect of the period ending on the
      Delivery Date of the Vessel.

            

    

     

    
      	
              21.2

            	
              Indemnity against
      costs

            

    

     

    The
Borrower shall pay to the Lender on demand, and the Borrower shall indemnify and
keep the Lender indemnified against, all costs, charges, expenses, claims,
liabilities, losses, duties and fees (including, but not limited to, legal fees
and expenses on a full indemnity basis) and taxes thereon suffered or incurred
by the Lender:

     

    
      	
               
      

            	
              21.2.1

            	
              in
      the negotiation, preparation, printing, execution and registration of this
      Agreement and the other Security
Documents;

            

    

     

    
      	
               
      

            	
              21.2.2

            	
              in
      the enforcement or preservation or the attempted enforcement or
      preservation of any of the Lender's rights and powers under this Agreement
      and the other Security Documents or of the security constituted by the
      Security Documents;

            

    

     

    
      	
               
      

            	
              21.2.3

            	
              in
      connection with any actual or proposed amendment of or supplement to this
      Agreement or any other of the Security Documents, or with any request of
      the Lender to grant any consent or waiver in respect of any provision of
      this Agreement or any other of the Security Documents, whether or not the
      same is given; and

            

    

     

    
      
        
        

      

      
        37

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              21.2.4

            	
              arising
      out of any act or omission made by the Lender in good faith in connection
      with any of the matters dealt with in the Security
    Documents.

            

    

     

    
      	
              21.3

            	
              Stamp
    duties

            

    

     

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

     

    
      	
              21.4

            	
              General
      indemnities

            

    

     

    The
Borrower shall pay to the Lender on demand, and the Borrower shall indemnify the
Lender against any losses, expenses or liabilities whether actual or contingent,
(as to the amount of which the Lender's certificate shall be conclusive and
binding upon the Borrower, except in case of manifest error) suffered or
incurred by the Lender in connection with or as a result of:

     

    
      	
               
      

            	
              21.4.1

            	
              any
      Advance not being drawn in full on the Drawdown Date specified in the
      Borrower's Notice of Drawdown in respect of that Advance for any reason,
      other than as a result of a default by the
  Lender;

            

    

     

    
      	
               
      

            	
              21.4.2

            	
              any
      repayment or prepayment of the whole or any part of an Advance being made
      on any date other than the last day of the Interest Period applicable
      thereto;

            

    

     

    
      	
               
      

            	
              21.4.3

            	
              any
      default in payment by the Borrower of any sum due under the Security
      Documents on its due date; or

            

    

     

    
      	
               
      

            	
              21.4.4

            	
              the
      occurrence or continuance of an Event of Default and/or a Potential Event
      of Default.

            

    

     

    
      	
              21.5

            	
              Breakage
      costs

            

    

     

    Without
prejudice to its generality, Clause 21.4 shall extend to:

     

    
      	
               
      

            	
              21.5.1

            	
              any
      interest, fees or other sums whatsoever paid or payable on account of any
      funds borrowed by the Lender in order to fund any unpaid amount;
      and

            

    

     

    
      	
               
      

            	
              21.5.2

            	
              to
      any loss (including loss of profit), premium, penalty or expense which may
      be incurred by the Lender in liquidating or employing deposits from third
      parties taken to make, maintain or fund the Loan (or any part thereof) or
      any other amount due or to become due to the Lender under the terms of any
      of the Security Documents.

            

    

     

    
      	
              21.6

            	
              Lender's Management
      Time

            

    

     

    Any
amount payable to the Lender by the Borrower under Clauses 21.2.2 and 21.2.3 and
under Clause 21.4 shall include the cost of utilising the Lender's
management time or other resources, which cost will be calculated on the basis
of such reasonable daily or hourly rates as the Lender may notify to the
Borrower, and is in addition to any fee paid or payable to the Lender under
Clause 21.1.

     

    
      
        
        

      

      
        38

        
          

        

      

      
        
        

      

    

     

    
      	
              21.7

            	
              Currency
      indemnity

            

    

     

    The
following shall apply if any amount is received or recovered by the Lender in
respect of any moneys or liabilities due, owing or incurred by the Borrower to
the Lender (whether as a result of any judgment or order of any court or in the
bankruptcy, administration, reorganisation, liquidation or dissolution of the
Borrower or by way of damages for any breach of any obligation to make any
payment
to the Lender) in a currency (the "Currency of Payment") other
than Dollars in whatever circumstances and for whatever reason:

     

    
      
        
        

      

      
        39

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              21.7.1

            	
              such
      receipt or recovery shall only constitute a discharge to the Borrower to
      the extent of the amount in Dollars which the Lender is able or would have
      been able, on the date or dates of receipt by it of such payment or
      payments in the Currency of Payment (or, in the case of any such date
      which is not a Banking Day, on the next succeeding Banking Day), to
      purchase in the foreign exchange market of its choice with the amount or
      amounts so received;

            

    

     

    
      	
               
      

            	
              21.7.2

            	
              if
      the amount of Dollars which the Lender is so able to purchase falls short
      of the amount originally due to the Lender, the Borrower shall indemnify
      and hold the Lender harmless against any loss or damage arising as a
      result by paying to the Lender that amount in Dollars certified by the
      Lender as necessary to so indemnify and hold harmless the
      Lender;

            

    

     

    
      	
               
      

            	
              21.7.3

            	
              this
      indemnity shall constitute a separate and independent obligation from the
      other obligations contained in this Agreement, shall give rise to a
      separate and independent cause of action, shall apply irrespective of any
      indulgence granted by the Lender from time to time and shall continue in
      full force and effect notwithstanding any judgment or order for a
      liquidated sum or sums in respect of amounts due hereunder or under any
      such judgment or order; and

            

    

     

    
      	
               
      

            	
              21.7.4

            	
              the
      certificate of the Lender as to the amount of any such loss or damage
      (which shall be deemed to constitute a loss suffered by the Lender) shall
      (save in case of manifest error) for all purposes be conclusive and
      binding on the Borrower.

            

    

     

    
      	
              21.8

            	
              Environmental
      indemnity

            

    

     

    Without
prejudice to or limitation of any other rights or remedies that may at any time
be available to or exercisable by the Lender, the Borrower shall indemnify and
hold harmless the Lender on demand against all costs, expenses, liabilities,
losses, damages, and injury, personal or economic, sustained or incurred by the
Lender or its property (real or personal) for any reason as a result of or in
connection with any release or the emission, presence, discharge of Material of
Environmental Concern on, from, affecting or caused by the Vessel or any other
Relevant Ship under any applicable Environmental Laws including, but not limited
to, costs and expenses incurred to clean up or remove discharged oil or other
Material of Environmental Concern, damages to third parties, natural resource
damage, assessments or penalties, and whether sustained or incurred during or
after the Security Period.

     

    
      	
              21.9

            	
              Survival of
      indemnities

            

    

     

    The
indemnities contained in the Security Documents shall continue in full force and
effect after the full and final discharge of the Outstanding Indebtedness with
respect to matters arising prior to such discharge.

     

    
      	
              22.

            	
              CHANGES
      IN CIRCUMSTANCES

            

    

     

    
      	
              22.1

            	
              Market
      disturbances

            

    

     

    This
Clause 22 applies if at any time prior to the commencement of any Interest
Period:

     

    
      
        
        

      

      
        40

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              22.1.1

            	
              the
      Lender shall determine that, by reason of circumstances affecting the
      Interbank Market generally, adequate and reasonable means do not or will
      not exist for ascertaining the Interest Rate applicable to that Interest
      Period;

            

    

     

    
      	
               
      

            	
              22.1.2

            	
              the
      Lender shall determine that the rate at which deposits in Dollars are
      being offered to the Lender in the Interbank Market would not adequately
      reflect the cost to the Lender of making, funding or maintaining the Loan
      or any part thereof for the duration of that Interest Period;
      or

            

    

     

    
      	
               
      

            	
              22.1.3

            	
              the
      Lender shall determine that, by reason of circumstances affecting the
      Interbank Market generally, deposits in Dollars are not available to it in
      sufficient amounts in the ordinary course of business and that accordingly
      the Lender will not be able to make, fund or maintain the Loan or any part
      of it during that Interest Period or maintain its obligations under the
      Master Agreement.

            

    

     

    
      	
              22.2

            	
              Determination
      Notice

            

    

     

    If any of
the circumstances described in Clause 22.1 occurs, the Lender shall
promptly give notice thereof (a "Determination Notice") to the
Borrower.

     

    
      	
              22.3

            	
              Suspension of Lender's
      commitment

            

    

     

    If a
Determination Notice is given prior to the Loan or any part thereof being
advanced by the Lender, then the Lender's obligation to make available the Loan
or any part thereof and/or perform its obligations under the Master Agreement
shall be suspended during the continuation of such circumstances.

     

    
      	
              22.4

            	
              Mitigation

            

    

     

    If the
Determination Notice is given after the advance of the first Advance by the
Lender, then the obligation of the Lender to make available any further Advances
shall be suspended during the continuation of such circumstances and, in
relation to that part of the Loan already drawn, the Borrower and the Lender
shall negotiate in good faith in order to agree a mutually satisfactory Interest
Rate or Rates, Interest Period or Periods and Interest Date or Dates or basis of
funding for the Lender to be substituted for those which would otherwise have
applied under this Agreement.

     

    
      	
              22.5

            	
              Alternative
      funding

            

    

     

    If the
Borrower and the Lender are unable to agree an Interest Rate or Rates, Interest
Period or Periods and Interest Date or Dates or basis of funding for the Lender
within a period not exceeding 30 days of the giving of such Determination
Notice, the Lender shall set an Interest Rate or Rates, an Interest Period or
Periods and Interest Date or Dates or basis of funding for the Lender all to
take effect from the expiration of the Interest Period current at the date of
the Determination Notice, which Interest Rate or Rates shall be the aggregate of
the Applicable Margin and the cost to the Lender of funding the Loan or relevant
part thereof (as the case may be) in any available currency for the Interest
Period or Periods so set.

     

    
      	
              22.6

            	
              Repeat of
      procedure

            

    

     

    If the
state of affairs referred to in the Determination Notice extends beyond the end
of an Interest Period so agreed or set, the foregoing procedure shall be
repeated as often as may be necessary.

     

    
      
        
        

      

      
        41

        
          

        

      

      
        
        

      

    

    

     

    
      	
              22.7

            	
              Borrower's right of
      prepayment

            

    

     

    The
Borrower may give 10 Banking Days notice to the Lender that it wishes to prepay
the Loan as a result of an interest rate set pursuant to Clause 22.5. The
relevant provisions of Clause 6.3 shall apply to that
prepayment.

     

    
      	
              23.

            	
              INCREASED
      COST

            

    

     

    
      	
              23.1

            	
              Causes of increased
      cost

            

    

     

    This
Clause 23 applies if the Lender considers that as a result of (a) the
introduction of or any change in any applicable law, regulation or official
directive (whether or not having the force of law), or in the interpretation
thereof by any authority charged with the administration thereof or by any court
of competent jurisdiction, or (b) compliance by the Lender with any directive,
request or requirement from any applicable governmental, fiscal or monetary
authority (whether or not having the force of law) or (c) any requirements for
increases in or any other alterations affecting capital adequacy:

     

    
      	
               
      

            	
              23.1.1

            	
              there
      is any change in the basis of taxation (other than the basis of taxation
      of the Lender's overall net income) of payments by the Borrower to the
      Lender of principal, interest or
otherwise;

            

    

     

    
      	
               
      

            	
              23.1.2

            	
              there
      is any change in the basis of taxation of payments by the Lender of
      principal or interest on, or otherwise in respect of, deposits taken from
      third parties to make, fund or maintain the
  Loan;

            

    

     

    
      	
               
      

            	
              23.1.3

            	
              any
      reserve, special deposit, cash ratio, liquidity or other requirements are
      imposed, modified or deemed applicable against assets held by or deposits
      in or for the account of, or loans by, the Lender (including, without
      limitation, any such requirements arising out of the implementation of any
      regulations which may replace those set out in the statement of the Basle
      Committee on Banking Regulations and Supervisory Practices dated July 1988
      and entitled "International Convergence of Capital Measurement and Capital
      Structures"); or

            

    

     

    
      	
               
      

            	
              23.1.4

            	
              any
      other condition is imposed on the Lender in respect of the transactions
      contemplated by this Agreement and/or the Master Agreement or any other of
      the Security Documents,

            

    

     

    and, as a
result, the Lender incurs an increased cost.

     

    
      	
              23.2

            	
              Types of increased
      cost

            

    

     

    An
increased cost is:

     

    
      	
               
      

            	
              23.2.1

            	
              any
      additional cost to the Lender of making, funding or maintaining the Loan
      or any part thereof or entering into this Agreement and/or the Master
      Agreement;

            

    

     

    
      	
               
      

            	
              23.2.2

            	
              any
      reduction in any amount payable or the effective return to the Lender
      under this Agreement and/or the Master Agreement;
  or

            

    

     

    
      	
               
      

            	
              23.2.3

            	
              the
      amount of any payment made by the Lender or the amount of any interest or
      other return foregone by the Lender calculated by reference to any amount
      received or receivable by the Lender from any other person who is a party
      to this Agreement and/or the Master Agreement or any Security
      Documents.

            

    

     

    
      
        
        

      

      
        42

        
          

        

      

      
        
        

      

    

     

    
      	
              23.3

            	
              Notification

            

    

     

    The
Lender shall promptly notify the Borrower of any increased cost incurred by the
Lender.

     

    
      	
              23.4

            	
              Indemnification of
      Lender

            

    

     

    The
Borrower shall pay to the Lender from time to time upon demand such additional
moneys as the Lender shall specify to be necessary to indemnify the Lender for
any increased cost.

     

    
      	
              23.5

            	
              No
    defence

            

    

     

    It shall
not be a defence to a claim by the Lender under this Clause 23 that any
increased cost could have been avoided by the Lender.

     

    
      	
              23.6

            	
              Separate
      debt

            

    

     

    Any
amount due from the Borrower under this Clause 23 shall be due as a
separate debt and shall not be affected by judgment being obtained for any other
sums due under or in respect of this Agreement.

     

    
      	
              23.7

            	
              Borrower's right of
      prepayment

            

    

     

    The
Borrower may give ten (10) Banking Days notice to the Lender that it wishes to
prepay the Loan as a result of any amounts payable by the Borrower under this
Clause 23.  The relevant provisions of Clause 6.3 shall
apply to that prepayment.

     

    
      	
              24.

            	
              ILLEGALITY

            

    

     

    
      	
              24.1

            	
              Causes of
      illegality

            

    

     

    This
Clause 24 applies if the introduction of, or any change in, any applicable
law or regulation, or in the interpretation thereof by any authority charged
with the administration thereof or by any court of competent jurisdiction, makes
it unlawful for the Lender to maintain or give effect to its obligations under
this Agreement.

     

    
      	
              24.2

            	
              Notification

            

    

     

    The
Lender shall promptly notify the Borrower of the occurrence of any of the
circumstances described in Clause 24.1.

     

    
      	
              24.3

            	
              Mandatory
      prepayment

            

    

     

    On so
notifying the Borrower the Lender's obligations under this Agreement shall
terminate forthwith and the Borrower shall immediately prepay the Loan. The
relevant provisions of Clause 6.3 shall apply to that
prepayment.

     

    
      	
              24.4

            	
              Force
      majeure

            

    

     

    The
Lender will not be liable for any failure on its part to provide or maintain the
Loan or any part thereof resulting, directly or indirectly, from any action,
inaction or purported action of any government or governmental agency or any
strike, boycott or blockade or any cause whatsoever outside its
control.

     

    
      
        
        

      

      
        43

        
          

        

      

      
        
        

      

    

     

    
      	
              25.

            	
              ASSIGNMENTS
      AND TRANSFERS

            

    

     

    
      	
              25.1

            	
              Successors and
      assigns

            

    

     

    This
Agreement shall be binding upon and inure to the benefit of each party hereto
and its successors and assigns.

     

    
      	
              25.2

            	
              No assignment by
      Borrower

            

    

     

    The
Borrower may not assign or transfer all or any of its rights, benefits or
obligations under this Agreement or under any of the other Security Documents
without the prior written consent of the Lender (which shall not be unreasonably
withheld or delayed).

     

    
      	
              25.3

            	
              Assignment and
      sub-participation by Lender

            

    

     

    The
Lender may freely assign and/or sub-participate all or any of its rights and
benefits under this Agreement and under the other Security Documents to another
bank or other finance institution.

     

    
      	
              25.4

            	
              Transfer of obligations by
      Lender

            

    

     

    The
Lender may transfer all or any of its obligations under this Agreement and under
the other Security Documents subject to the prior consent of the Borrower, which
shall not be unreasonably withheld, provided that no such consent shall be
required in the case of a transfer to a subsidiary, affiliate or holding company
of the Lender.

     

    
      	
              25.5

            	
              Disclosure of
      information

            

    

     

    The
Lender may disclose to any potential transferee, assignee or sub-participant, or
to any other party with whom it may propose to enter into contractual relations
in connection with this Agreement or any other of the Security Documents, such
information about the Borrower and the other Obligors and their respective
businesses, assets or financial condition as the Lender shall consider
appropriate.

     

    
      	
              25.6

            	
              Change of lending
      office

            

    

     

    The
Lender may at any time and from time to time change its lending office and/or
delegate any one or more of its rights, powers and/or obligations under this
Agreement and the other Security Documents to any person providing that the
Lender remains primarily liable.

     

    
      	
              25.7

            	
              Further
      assurance

            

    

     

    The
Borrower undertakes to do or to procure all such acts and things and to sign,
execute and deliver or procure the signing, execution and deliver of all such
instruments and documents as the Lender may reasonably require for the purpose
of perfecting any such assignment, transfer, sub-participation, change or
delegation as aforesaid.

     

    
      	
              26.

            	
              SET-OFF

            

    

     

    
      	
              26.1

            	
              Set-off

            

    

     

    The
Borrower authorises the Lender without prejudice to any of the Lender's rights
at law in equity or otherwise, at any time and without notice to the
Borrower:

     

    
      
        
        

      

      
        44

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              26.1.1

            	
              to
      combine and/or consolidate all or any accounts (whether current, deposit,
      loan or of any other nature whatsoever, whether subject to notice or not
      and in whatever currency) of the Borrower with any branch of the
      Lender;

            

    

     

    
      	
               
      

            	
              26.1.2

            	
              to
      apply any credit balance (whether or not then due) on any such account or
      accounts of the Borrower in or towards satisfaction of any sum due and
      payable but not paid to the Lender and any other liability of the Borrower
      (whether actual or contingent) under this Agreement and/or any of the
      Security Documents; and

            

    

     

    
      	
               
      

            	
              26.1.3

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

            

    

     

    
      	
              26.2

            	
              Set off under Master
      Agreement

            

    

     

    The
rights conferred on the Lender by this Clause 26 shall be in addition to,
and without prejudice to or in limitation of, the rights of netting and set off
conferred to the Lender by the Master Agreement. The Borrower acknowledges that
the Lender 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 Potential Event of
Default, or an Event of Default or Termination Event (as those terms are defined
in the Master Agreement).

     

    
      	
              26.3

            	
              Purchase of other
      currencies

            

    

     

    For all
or any of the above purposes, the Lender is authorised to purchase with the
moneys standing to the credit of such account or accounts any such other
currency or currencies as may be necessary to effect such application. The
Lender shall not be obliged to exercise any right given to it by this
Clause 26.

     

    
      	
              27.

            	
              MISCELLANEOUS

            

    

     

    
      	
              27.1

            	
              Time of
      essence

            

    

     

    Time is
of the essence as regards every obligation of the Borrower under this Agreement
and the other Security Documents, but no delay or omission by the Lender to
exercise any right, power or remedy vested in it under this Agreement or any
other of the Security Documents or by law shall impair such right, power or
remedy, or be construed as a waiver of, or as an acquiescence in, any default by
the Borrower.

     

    
      	
              27.2

            	
              No
  waiver

            

    

     

    If the
Lender on any occasion agrees to waive any such right, power or remedy, such
waiver shall not in any way preclude or impair any further exercise thereof or
the exercise of any other right, power or remedy.

     

    
      	
              27.3

            	
              Waivers to be in
      writing

            

    

     

    Any
waiver by the Lender of any provision of this Agreement or any other of the
Security Documents, and any consent or approval given by the Lender shall only
be effective if given in writing and then only strictly for the purpose and upon
the terms for which it is given.

     

    
      
        
        

      

      
        45

        
          

        

      

      
        
        

      

    

     

    
      	
              27.4

            	
              Amendments to be in
      writing

            

    

     

    Neither
this Agreement nor any of the other Security Documents may be amended or varied
orally but only by an instrument signed by the Lender and each of the other
parties thereto.

     

    
      	
              27.5

            	
              Remedies
      cumulative

            

    

     

    The
rights, powers and remedies of the Lender contained in this Agreement and the
other Security Documents are cumulative and not exclusive of each other nor of
any other rights, powers or remedies conferred by law, and may be exercised from
time to time and as often as the Lender may think fit.

     

    
      	
              27.6

            	
              Severability

            

    

     

    If at any
time one or more of the provisions of this Agreement or any other of the
Security Documents is or becomes invalid, illegal or unenforceable in any
respect under any law by which it may be governed or affected, the validity,
legality and enforceability of the remaining provisions shall not be in any way
affected or impaired as a result.

     

    
      	
              27.7

            	
              Counterparts

            

    

     

    This
Agreement may be executed in any number of counterparts and all such
counterparts taken together shall be deemed to constitute but one and the same
instrument.

     

    
      	
              27.8

            	
              Conclusiveness of Lender's
      certificates

            

    

     

    The
certificate or determination of the Lender of a rate or amount under this
Agreement and any other Security Document is, in the absence of manifest error,
conclusive evidence of the matters to which it relates and is binding on the
Borrower.

     

    
      	
              27.9

            	
              Previous offers by the Lender
      superseded

            

    

     

    This
Agreement shall in all respects supersede the terms of any offer or commitment
with respect to the Loan made by the Lender to the Borrower or its agents prior
to the date of this Agreement (save for any provision relating to the payment of
the Lender's fees and expenses).

     

    
      	
              28.

            	
              FURTHER
      ASSURANCE

            

    

     

    
      	
              28.1

            	
              Borrower's
      duties

            

    

     

    The
Borrower shall, upon demand, and at its own expense, sign, perfect, do, execute
and register all such further assurances, documents, acts and things as the
Lender may reasonably require for the purpose of more effectually accomplishing
or perfecting the transaction or security contemplated by this
Agreement.

     

    
      	
              29.

            	
              NOTICES

            

    

     

    
      	
              29.1

            	
              Addresses

            

    

     

    All
notices (which expression includes any demand, request, consent or other
communication) to be given by one party to the other under this Agreement and
the other Security Documents shall be in writing and (unless delivered
personally) shall be given by telefax or first class pre-paid post (airmail if
sent internationally) and be addressed:

     

    
      
        
        

      

      
        46

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              29.1.1

            	
              in
      the case of the Lender, as follows:

            

    

     

    Domshof
17

    28195
Bremen

    Federal
Republic of Germany

    

    
      
        	
              	
                Telefax
      No:

              	
                +(49)
      421 3609 329

              

      

      
        	
              	
                Attn:

              	
                Matthias
      Fischer

              

      

    

     

    
      	
               
      

            	
              29.1.2

            	
              in
      the case of the Borrower, as
follows:

            

    

     

    c/o
Walkers SPV Limited

    Walker
House

    87 Mary
Street

    George
Town

    Grand
Cayman KY1-9002

    Cayman
Islands

    

    
      
        	
              	
                Telefax
      No:

              	
                1
      345 945 4757

              

      

      
        	
              	
                Attn:

              	
                The
      Director, Kronos Shipping I,
Ltd.

              

      

    

     

    
      	
              29.2

            	
              Changes of
      address

            

    

     

    If the
Lender or the Borrower wishes to change its address for communication, the one
shall give to the other not less than 5 Banking Days' notice in writing of the
change desired.

     

    
      	
              29.3

            	
              Deemed receipt of
      notices

            

    

     

    Notices
addressed as provided above shall be deemed to have been duly given when
despatched (in the case of telefax), when delivered (in the case of personal
delivery), 2 days after posting (in the case of letters sent within the same
country), or 2 days after posting (in the case of letters sent internationally),
provided that notices to the Lender shall be effective only upon their actual
receipt by the Lender. In each of the above cases any notice received on a
non-working day or after business hours in the country of receipt shall be
deemed to be given on the next following working day in such
country.

     

    
      	
              29.4

            	
              English
      language

            

    

     

    All
notices and documents to be given or delivered pursuant to or otherwise in
relation to this Agreement and the other Security Documents shall be in the
English language or be accompanied by a certified English
translation.

     

    
      	
              30.

            	
              APPLICABLE
      LAW AND JURISDICTION

            

    

     

    
      	
              30.1

            	
              Governing
      law

            

    

     

    This
Agreement shall be governed by and construed in accordance with English
law.

     

    
      	
              30.2

            	
              Submission to
      jurisdiction

            

    

     

    The
Borrower hereby irrevocably agrees for the exclusive benefit of the Lender that
the English courts shall have jurisdiction in relation to any dispute and any
suit, action or proceeding (referred to together in this Clause 30 as
"Proceedings") which may
arise out of or in connection with this Agreement and/or any of the other
Security Documents, and for such purposes irrevocably submits to the
jurisdiction of such courts.

    
      
         

      

      
        47

        
          

        

      

      
         

      

    

    
      	
              30.3

            	
              Service of
      process

            

    

     

    The
Borrower hereby irrevocably agrees:

     

    
      	
               
      

            	
              30.3.1

            	
              that,
      for the purpose of Proceedings in England, any legal process may be served
      upon SH Process Agents Limited whose registered office is presently at
      One, St. Paul's Churchyard, London EC4M 8SH who is hereby authorised to
      accept service on behalf of the Borrower, which shall be deemed to be good
      service on the Borrower; and

            

    

     

    
      	
               
      

            	
              30.3.2

            	
              that
      throughout the Security Period it will maintain a duly appointed process
      agent in England, duly notified to the Lender, and that failure by any
      such process agent to give notice thereof to it shall not impair the
      validity of such service or of a judgment or order based
      thereon.

            

    

     

    
      	
              30.4

            	
              Choice of
      forum

            

    

     

    Nothing
in this Clause 30 shall affect the right of the Lender to serve process in
any manner permitted by law or limit the right of the Lender to take Proceedings
against the Borrower in any other court of competent jurisdiction, nor shall the
taking of Proceedings in one or more jurisdictions preclude the taking of
Proceedings by the Lender in any other jurisdiction, whether concurrently or
not.

     

    The
Borrower shall not commence any Proceedings in any country other than England in
relation to any matter arising out of or in connection with this Agreement
and/or any of the other Security Documents.

     

    
      	
              30.5

            	
              Forum
      convenience

            

    

     

    The
Borrower irrevocably waives any objection which it may now or hereafter have on
the grounds of inconvenient forum or otherwise to Proceedings being brought in
any such court as is referred to in this Clause 30, and further irrevocably
agrees that a judgment or order in any Proceedings brought in the English courts
shall be conclusive and binding upon the Borrower and may be enforced without
review in the courts of any other jurisdiction.

     

    
      	
              30.6

            	
              Consent

            

    

     

    The
Borrower consents generally in respect of any Proceedings arising out of or in
connection with this Agreement to the giving of any relief or the issue of any
process in connection with such Proceedings, including without limitation, the
making, enforcement or execution against any property or assets whatsoever of
any order or judgment which may be made or given in such
Proceedings.

     

    
      	
              30.7

            	
              Waiver of
      immunity

            

    

     

    To the
extent that the Borrower may be entitled in any jurisdiction to claim for itself
or its property or assets immunity in respect of its obligations under this
Agreement from service of process, jurisdiction, suit, judgment, execution,
attachment (whether before judgment, in aid of execution or otherwise) or legal
process, or to the extent that in any such jurisdiction there may be attributed
to it or its property or assets such immunity (whether or not claimed) the
Borrower irrevocably agrees not to claim and irrevocably waives such immunity to
the fullest extent permitted by the laws of such jurisdiction.

    
      
         

      

      
        48

        
          

        

      

      
         

      

    

    AS WITNESS the hands of the
duly authorised representatives of the parties hereto the day and year first
before written.

    
      
         

      

      
        49

        
          

        

      

      
         

      

    

    SCHEDULE
1

    

    FORM
OF NOTICE OF DRAWDOWN

    

    
      	
              TO:

            	
              Deutsche
      Schiffsbank Aktiengesellschaft

            

    

    Domshof
17

    28195
Bremen

    Federal
Republic of Germany

    

    
      	
              ATTN:

            	
              Matthias
      Fischer

            

    

    

    Dear
Sirs

    [•][•]

    NOTICE OF
DRAWDOWN

    

    Notice
of Drawdown - Loan and Guarantee Facility Agreement dated [•] 20[•]

     

    We refer
to the loan and guarantee facility agreement dated [•] 2008 (the "Facility Agreement") made
between (1) ourselves as Borrower and (2) yourselves as Lender providing for the
making available to us of a secured term loan in the amount of up to $30,000,000
and a guarantee facility in the amount of up to $16,320,000.

     

    Pursuant
to Clause 3 of the Loan Agreement we hereby give you notice that we wish to
draw the Loan as follows:

     

    
      
        
          
            
              
                	
                        Amount
      of Loan

                      	 
      	
                        :
      $[•]

                      
	 	 	 
	
                        Proposed
      Drawdown Date

                      	 
      	
                        :
      [•]

                      
	 	 	 
	
                        Duration
      of first Interest Period

                      	 
      	
                        :
      [•]

                      
	 
      	 
      	 
      

              

            

          

        

      

    

    We hereby
request and authorise you to apply the proceeds of the Loan by paying the
proceeds by [•], to [•] Account No. [•], quoting the reference [•].

     

    We
confirm that:

     

    
      	
              1.

            	
              the
      representations and warranties made by us as set out in Clause 16 of
      the Loan Agreement are true and accurate on the date hereof as if made on
      such date; and

            

    

     

    
      	
              2.

            	
              no
      Event of Default or Potential Event of Default has occurred and is
      continuing or will occur as a result of the proposed
      borrowing.

            

    

     

    
      Yours
faithfully

    

    

    
      
        
          	 
      	 
      
	
                  For
      and on behalf of

                	 
      
	
                  KRONOS SHIPPING I,
      LTD.

                	 
      

        

      

    

    
      
         

      

      
        50

        
          

        

      

      
         

      

    

    SCHEDULE
2

    

    FORM
OF ISSUE REQUEST

    

    
      	
              TO:

            	
              Deutsche
      Schiffsbank Aktiengesellschaft

            

    

    Domshof 17

    28195 Bremen

    Federal Republic of
Germany

    

    
      	
              ATTN:

            	
              Matthias
      Fischer

            

    

    

    Date: [•]
200[•]

    Dear
Sirs

    

    Issue
Request - Loan and Guarantee Facility Agreement dated [•] 2008

     

    We refer
to the loan and guarantee facility agreement dated [•] 2008 (the "Facility Agreement") made
between (1) ourselves as Borrower, (2) yourselves as Lender providing for the
making available to us of a secured term loan in the amount of up to $30,000,000
and a guarantee facility in the amount of up to $16,320,000.

     

    Expressions
defined in the Facility Agreement shall have the same meanings when used in this
letter.

     

    Pursuant
to Clause 4 of the Facility Agreement we hereby give you notice that we
wish you to issue to the Seller on [•] 200[•] the Bank Guarantee in respect of
the Vessel with hull number MD2007-11-12 in the form attached to the Facility
Agreement .

     

    We
confirm that:

     

    
      	
              (a)

            	
              the
      representations and warranties made by us as set out in Clause 16 of
      the Facility Agreement are true and accurate on the date hereof as if made
      on such date; and

            

    

     

    
      	
              (b)

            	
              no
      Event of Default or Potential Event of Default has occurred and is
      continuing or will occur as a result of the issue of the requested Bank
      Guarantee.

            

    

     

    Yours
faithfully

    

    
      
        
          	 
      	 
      
	
                  For
      and on behalf of

                	 
      
	
                  KRONOS SHIPPING I,
      LTD.

                	 
      

        

      

    

    
      
         

      

      
        51

        
          

        

      

      
         

      

    

    SCHEDULE
3

    

    CONDITIONS
PRECEDENT DOCUMENTS AND EVIDENCE

    

    The
documents and evidence referred to in Clause 14 are as
follows:

     

    
      	
              A.

            	
              Documents and evidence
      to be received on or before the date on which Notice of Drawdown for any
      Advance is given by the
Borrower

            

    

     

    
      	
              1.

            	
              Certified
      copies of the certificate of incorporation and the memorandum and articles
      of association or equivalent constitutional documents of each
      Obligor.

            

    

     

    
      	
              2.

            	
              A
      certificate of good standing for each Obligor or other evidence that each
      Obligor is in good standing in its country of
    incorporation.

            

    

     

    
      	
              3.

            	
              A
      certificate of incumbency of each Obligor, signed by the secretary or a
      director of that Obligor stating its officers and
    directors.

            

    

     

    
      	
              4.

            	
              A
      certificate as to the shareholding of each Obligor, signed by the
      secretary or a director of that Obligor, stating the full names and
      addresses of the person or persons legally and beneficially entitled as
      shareholders/stockholders of the entire issued and outstanding
      shares/stock of that Obligor.

            

    

     

    
      	
              5.

            	
              Certified
      copies of resolutions duly passed by the directors and the shareholders of
      each Obligor at separate meetings evidencing approval of the transactions
      contemplated by this Agreement and the other Security Documents and the
      Underlying Documents and authorising the execution of the
      same.

            

    

     

    
      	
              6.

            	
              The
      original of any power of attorney issued by each Obligor in favour of any
      person or persons executing this Agreement and the other Security
      Documents.

            

    

     

    
      	
              7.

            	
              Certified
      copies of all licences, authorisations, approvals and consents required in
      connection with the execution, delivery, performance, validity and
      enforceability of the Security Documents and the Underlying
      Documents.

            

    

     

    
      	
              8.

            	
              Such
      certificates and documents as the Lender may require to comply with any
      money-laundering prevention procedures then applicable to
    it.

            

    

     

    
      	
              9.

            	
              Original
      of the Refund Guarantee with evidence of due execution thereof by the
      Refund Guarantor and of SAFE registration of the Refund Guarantee and the
      Pre-Delivery Security Assignment satisfactory to the Lender together with
      certified copies of the Underlying Documents and of all documents, signed
      or issued by the Borrower and/or the other parties thereto under or in
      connection therewith.

            

    

     

    
      	
              10.

            	
              The
      Security Documents referred to in Clause 15.3 and all documents,
      instruments, notices and acknowledgements thereto required under those
      Security Documents duly executed by the relevant
  Obligors.

            

    

     

    
      	
              11.

            	
              Evidence
      that the Earnings Account has been duly opened by the Borrower and/or the
      Guarantor with the Lender and that all board resolutions, mandates,
      signature cards and other documents or evidence required in connection
      with the opening, maintenance and operation of such Account have been duly
      delivered to the Lender.

            

    

    
      
         

      

      
        52

        
          

        

      

      
         

      

    

    
      	
              12.

            	
              Confirmation
      from the agents in England nominated in this Agreement and elsewhere in
      the Security Documents by each Obligor for the acceptance of service of
      process, that they consent to such
nomination.

            

    

     

    
      	
              13.

            	
              Favourable
      opinions from the Lender's legal advisers with respect to each Obligor,
      and the overall transaction contemplated by this Agreement, in such terms
      as the Lender may require, including opinions from the
      following:

            

    

     

    
      	
               
      

            	
              Walkers
      - special legal advisers to the Lender on the laws of the Cayman
      Islands;

            

    

     

    
      	
               
      

            	
              Montanios
      & Montanios - special legal advisers to the Lender on the laws of
      Cyprus.

            

    

     

    
      	
              14.

            	
              Evidence
      that the Guarantor has paid the First Instalment of the Contract Price
      payable pursuant to the Building Contract together with the Seller's
      confirmation that it has no further claims in respect of that
      amount.

            

    

     

    
      	
              15.

            	
              Copies
      of the supervision agreement(s) in relation to the
  Vessel.

            

    

     

    
      	
              16.

            	
              In
      respect of each Pre-Delivery Advance which is to be paid to the Seller in
      or towards payment of the relevant instalment of the Contract
      Price:

            

    

     

    
      	
              16.1

            	
              a
      telefax notice from the Seller attaching the relevant Stage Certificate
      countersigned by the Classification Society in the appropriate form
      prescribed by Article II of the Building Contract;
  and

            

    

     

    
      	
              16.2

            	
              payment
      by the Guarantor to the Lender 3 Banking Days prior to the applicable
      Drawdown Date of the balance of the relevant amount then due to the Seller
      under the Building Contract which is not being financed with the proceeds
      of that Advance.

            

    

     

    
      	
              17.

            	
              Such
      certificates and documents as the Lender may require to comply with the
      money laundering prevention procedures applicable to
  it.

            

    

     

    
      	
              B.

            	
              The documents and
      evidence to be received on or before the Drawdown Date of the Delivery
      Advance

            

    

     

    
      	
              1.

            	
              The
      Security Documents specified in Clause 15.4 and all documents,
      instruments, notices and acknowledgements thereto required under those
      Security Documents duly executed by the relevant Obligors, and, in the
      case of the Mortgage, evidence that that Mortgage has been duly registered
      or is capable of immediate registration with the required priority in the
      appropriate register.

            

    

     

    
      	
              2.

            	
              Evidence
      that:

            

    

     

    
      	
              2.1

            	
              the
      Vessel has been duly completed and unconditionally delivered by the Seller
      to the Guarantor in accordance with the Building Contract and accepted by
      the Guarantor as being in all respects in compliance with the provisions
      of the Building Contract to include certified true copies of the protocol
      of delivery and acceptance signed by the Seller and of all other documents
      to be provided by the Seller upon delivery of the Vessel pursuant to the
      Building Contract;

            

    

    
      
         

      

      
        53

        
          

        

      

      
         

      

    

    
      	
              2.2

            	
              that
      it is in the absolute ownership of the Guarantor as the sole, legal and
      beneficial owner of the Vessel free from all Encumbrances save for
      Permitted Encumbrances;

            

    

     

    
      	
              2.3

            	
              it
      is duly registered under the agreed Flag State in the sole ownership of
      the Guarantor;

            

    

     

    
      	
              2.4

            	
              that
      it is in compliance with all applicable laws, regulations and requirements
      (statutory or otherwise) applicable to ships registered under the agreed
      Flag State and engaged in the service in which it is or is to be
      engaged;

            

    

     

    
      	
              2.5

            	
              it
      is operationally seaworthy and in every way fit for
    service;

            

    

     

    
      	
              2.6

            	
              the
      Vessel maintains its classification with the Classification Society free
      from all recommendation, notations and average
  damage;

            

    

     

    
      	
              2.7

            	
              it
      is managed by the Approved Manager on the terms of the Approved Management
      Agreement; and

            

    

     

    
      	
              2.8

            	
              it
      is insured in accordance with the provisions of the relevant Security
      Documents and all requirements of those Security Documents in respect of
      the Insurances and the noting of the Lender's interest thereon have been
      complied with.

            

    

     

    
      	
              3.

            	
              A
      valuation of the Vessel dated not earlier than 20 days prior to the
      Delivery Date by a valuer nominated by the Lender (and at the cost of the
      Borrower) evidencing a market value of the Vessel acceptable in all
      respects to the Lender.

            

    

     

    
      	
              4.

            	
              An
      opinion from the Lender's insurance advisers on the Insurances
      satisfactory in all respects to the
Lender.

            

    

     

    
      	
              5.

            	
              Evidence
      satisfactory to the Lender in all respects of compliance by the Vessel
      with the requirements of the ISM and ISPS
Code.

            

    

     

    
      	
              6.

            	
              All
      amounts payable to the Seller under the Building Contract other than that
      part to be financed by the Lender shall be paid to the Lender 3 Banking
      Days before the Delivery Date.

            

    

     

    
      	
              7.

            	
              Evidence
      satisfactory to the Lender in respect of the Delivered Cost of the
      Vessel;

            

    

     

    
      	
              8.

            	
              Favourable
      legal opinions on the laws of any relevant jurisdiction from such firm in
      that jurisdiction as the Lender may
appoint.

            

    

     

    
      	
              9.

            	
              Such
      updating documents and evidence in respect of any matters referred to at
      A. above as the Lender may reasonably
require.

            

    

     

    
      	
              C.

            	
              Unless
      otherwise specified, each copy document referred to in this Schedule shall
      be certified as a true and complete and up to date copy of the original by
      a director or the secretary of the Borrower or by another person
      acceptable to the Lender.

            

    

    
      
         

      

      
        54

        
          

        

      

      
         

      

    

    SCHEDULE
4

    

    FORM
OF BANK GUARANTEE

    

    To:         Jiangxi
Topsky Technology Co., Ltd.

    N0.200
Zanggian Road

    Nanchang
City 330002

    Jiangxi
Province

    The
People's Republic of China

    

    and

    

    Nantong
Mingde Heavy Industry Stock Co., Ltd.

    Wujie
Town

    Tongzhou
City

    Jiangsu

    The
People's Republic of China

    

    Date: [•]
2008

    Dear
Sirs

    

    
      	
              1.

            	
              In
      consideration of Jiangxi Topsky Technology Co., Ltd. and Nantong Mingde
      Heavy Industry Stock Co., Ltd. (hereinafter collectively called the "SELLER") entering into
      the Shipbuilding Contract No. MD096-25000-CT-06 (the "Shipbuilding Contract")
      dated 12 December 2007 with Anthos Shipping Co. Ltd. of Limassol Cyprus as
      the buyer (the "BUYER") for the
      construction of one (1) 25,000DWT Product Oil/Chemical Tanker IMO-II known
      as shipyard's Hull No. MD2007-11-12 (the "Vessel"), we, Deutsche
      Schiffsbank Aktiengesellschaft hereby IRREVOCABLY, ABSOLUTELY and
      UNCONDITIONALLY guarantee, as the primary obligor and not merely as the
      surety, the due and punctual payment by the BUYER of the [2nd][3rd]
      instalment of the Contract Price] (as defined in the Contract) amounting
      to a total sum of United States Dollars eight million one hundred and
      sixty thousand Dollars (US$8,160,000) only as specified in (2)
      below.

            

    

     

    
      	
              2.

            	
              The
      instalments guaranteed hereunder, pursuant to the terms of the
      Shipbuilding Contract, comprise the [2nd]
      [3rd]
      instalment of the Contract Price in an amount not exceeding Dollars eight
      million one hundred and sixty thousand (US$8,160,000) payable by the BUYER
      within five (5) New York banking days after [the cutting of the first
      steel plate in the Seller's workshop] [laying of the keel] of the Vessel
      as advised to us in writing by the
SELLER.

            

    

     

    
      	
              3.

            	
              We
      also IRREVOCABLY, ABSOLUTELY and UNCONDITIONALLY guarantee, as primary
      obligor and not merely as surety, the due and punctual payment by the
      BUYER of interest on each instalment guaranteed hereunder at the rate of
      six per cent (6%) per annum from and including the first day after the
      respective instalment has become due, as advised to us in writing by the
      SELLER until the date of full payment by us of such amount guaranteed
      hereunder.

            

    

     

    
      	
              4.

            	
              In
      the event that the BUYER fails to punctually pay any instalment guaranteed
      hereunder or the BUYER fails to pay any interest thereon, and any such
      default continues for a period of fifteen (15) calendar days, then, upon
      receipt by us of your first written demand stating that the claimed amount
      is due to you and has remained unpaid for fifteen (15) calendar days from
      the due date, we shall immediately pay to you (the SELLER) the relevant
      instalment, together with the interest as specified in paragraph 3 hereof,
      without requesting you to take any or further action, procedure or step
      against the BUYER or with respect to any other security which you may
      hold. Any demand has to be accompanied by and any payment is subject to a
      written confirmation signed by BUYER'S representative confirming with
      regard to the [second] [third] instalment the [the cutting of the first
      steel plate in the SELLER'S workshop][keel laying] was carried out
      however, in any event of the [2nd][3rd]
      instalment shall not be earlier than [xxxx
  200x].

            

    

     

    
      
        
        

      

      
        55

        
          

        

      

      
        
        

      

    

     

    
      	
              5.

            	
              Any
      payment by us under this Guarantee shall be made in United States Dollars
      by telegraphic transfer to [SELLER'S Bank] as receiving bank nominated by
      you for credit to the account of you with, [name and address of SELLER'S
      Bank], in favour of you.

            

    

     

    
      	
               
      

            	
              Any
      payment made by ourselves or by the BUYER through ourselves under
      reference of this Guarantee shall automatically reduce this Guarantee by
      the amount of the payment
accordingly.

            

    

     

    
      	
               
      

            	
              Our
      obligations under this Guarantee shall not be affected or prejudiced by
      any dispute between you as the SELLER and the BUYER under the Shipbuilding
      Contract or by the SELLER'S delay in the construction and/or delivery of
      the Vessel due to whatever cause or by any variation or extension of their
      terms thereof or by any security or other indemnity now or hereafter held
      by you in respect thereof, or by any time or indulgence granted by you or
      any other person in connection therewith, or by any invalidity or
      unenforceability of the terms thereof, or by any act, omission, fact or
      circumstances whatsoever, which could or might, but for the foregoing,
      diminish in any way our obligations under this
  Guarantee.

            

    

     

    
      	
               
      

            	
              However,
      in the event of any dispute between the Buyer and the SELLER and such
      dispute is referred by the SELLER or by the BUYER to arbitration in
      accordance with Article XXI of the Shipbuilding Contract, we shall be
      entitled to withhold and defer payment until the arbitration award is
      published in favour of the SELLER.

            

    

     

    
      	
              6.

            	
              Any
      claim or demand shall be in writing signed by one of your officers and may
      be served on us by hand or by post and if sent by post to Domshof 17,
      28195 Bremen, Federal Republic of Germany, Attn: Matthias Fischer (or such
      other address as we may notify you in writing), or by authenticated swift
      via [SELLER'S Bank], who shall certify the signature on your demand is
      authentic. The signature on any demand by hand or by mail shall be
      authenticated thereon by [SELLER'S
Bank].

            

    

     

    
      	
              7.

            	
              This
      Guarantee shall come into full force and effect upon receipt by us of the
      respective Refundment Guarantee issued by [•] and our receipt of the
      BUYERS written acceptance thereof, and expires with the return of this
      original Guarantee to us or with the payment of the guaranteed amount, at
      the latest however on [date to be inserted] by which date demands in full
      in accordance with the guarantee terms must have been received by us in
      (•). We shall advise you in writing upon our receipt of the BUYER'S
      written acceptance of the Refundment
Guarantee.

            

    

     

    
      	
              8.

            	
              The
      maximum amount, however, that we are obliged to pay to you under this
      Guarantee shall not exceed the aggregate amount of United States Dollars
      [insert amount] being an amount equal to the sum of the [2nd][3rd]
      instalment guaranteed hereunder, plus interest as stated
      above.

            

    

     

    
      	
              9.

            	
              All
      payments by us under this Guarantee shall be made without any set-off or
      counterclaim and without deduction or withholding for or on account of any
      taxes, duties, or charges whatsoever unless we are compelled by law to
      deduct or withhold the same. In the latter event we shall make the minimum
      deduction or withholding permitted and will pay such additional amounts as
      may be necessary in order that the net amount received by you after such
      deductions or withholdings shall equal the amount which would have been
      received had no such deduction or withholding been required to be
      made.

            

    

     

    
      
        
        

      

      
        56

        
          

        

      

      
        
        

      

    

     

    
      	
              10.

            	
              This
      Letter of Guarantee may not be assigned by you without our prior written
      consent (not to be unreasonably
withheld).

            

    

     

    
      	
              11.

            	
              This
      Letter of Guarantee shall be construed in accordance with and governed by
      the laws of England. Any dispute arising under this Letter of Guarantee
      shall be settled by arbitration in London, England in accordance with
      English Law. The arbitration panel shall be comprised of three
      arbitrators, one to be chosen by us and the other to be chosen by you. The
      two arbitrators thus appointed shall select a third arbitrator. All
      arbitration shall be conducted in English and the award shall be binding
      and final on all parties.

            

    

     

    
      	
              12.

            	
              Upon
      expiry of this Letter of Guarantee as aforesaid you shall return the same
      to us without any request or demand from
us.

            

    

     

    IN WITNESS WHEREOF, we have
caused this Letter of Guarantee to be executed and delivered by our duly
authorised representative the day and year above written.

     

    Very
Truly Yours

    

    
      
        
          	
                  By:

                	 
      	 

        

      

    

    
      
         

      

      
        57

        
          

        

      

      
         

      

    

    THE
BORROWER

    

    
      
        	
                SIGNED for and on
      behalf

              	
                )

              
	
                of KRONOS SHIPPING I,
      LTD.

              	
                )

              
	
                by     /s/
      Jason Morton

              	
                )

              
	 
      	
                )

              
	
                its
      duly appointed attorney

              	
                )

              
	
                in
      the presence of:  Valentine Nikiforan

              	
                )

              

      

    

    

    /notary/

    

    THE
LENDER

    

    
      
        	
                SIGNED for and on
      behalf

              	
                )

              
	
                of
      KRONOS SHIPPING I,
      LTD.

              	
                )

              
	
                by        /s/
      Rebecca Oliver

              	
                )

              
	 
      	
                )

              
	
                its
      duly appointed attorney

              	
                )

              
	
                in
      the presence of:  Adam Shire

              	
                )

              

      

    

    

    /notary/

    
      
         

      

      
        58/Berenberg
Bank Logo/

    

    
      	
              Confidential!

              Suresh
      Capital Maritime Partners

              Germany
      GmbH

              Garrelstraße
      14

              26789
      Leer

            

    

    

    
      
        
          
            
              
                
                  
                    	
                            Stefan
      Bülau

                            International
      Shipping

                            Department

                          	
                            Phone

                            Fax

                            E-Mail

                          	
                            +49
      40 350 60-743

                            +49
      40 35 21 32

                            Stephan.Buelau@Berenberg.de

                          	
                            29
      November
2006

                          

                  

                

              

            

          

        

      

    

    

    
      Credit
Facility

    

    

    
      	
              Dear
      Sirs,

            

    

    

    We refer
to our discussions with you and confirm on the basis of our General Business
Conditions that we will make available to you the credit facility set out
below:

    

    
      Credit
Amount

    

     

    Up to the
maximum of EUR 26,400,000.00 (written in full: Euros twenty six million four
hundred thousand 0/100 including all accrued interest during the lifetime of the
loan.

     

    
      Drawings

    

     

    Drawing
up to the credit amount
may be made by debiting your accounts with the Master-No. 52751 as fixed-rate
borrowing.

     

    
      Purpose

    

     

    Partial
pre-delivery financing of 4 Anker Handling Tugs (each
“Vessel”).

     

    
      Term

    

     

    This
facility (the “Facility”) will be made available in several tranches (the
“Tranche”) with each Tranche being directly related to a vessel and a certain
status of construc- tion of the relevant vessel.

     

    Neuer
Jungfernstieg 20 - 20354 Hamburg (Germany)

    Phone +49
40 350 60-0 - Fax +49 40 35 06 0-900  - info@berenberg.de –

    Telex 215
781

    Head
office:  Hamburg Amßgericht Hamburg HRH 42659

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    /Berenberg
Bank Logo/

    

    
      	
              Letter
      to Suresh Capital Maritime Partners Germany GmbH

               

            	
              Page
      2

              29
      November 2006

            

    

     

    We will
keep those Tranches available to you until the date of the delivery of the
relevant Anker Handling Tug but in no case longer than up to 30 December
2008.  At the end of the term all outstanding principal plus accrued
interest and costs shall be immediately due for repayment.

     

    You
hereby undertake to pay us from the day of the relevant drawdown is made
interest on the principal amount of the loan outstanding from time to time and
on any accrued and unpaid interest (both before and after judgment) on the loan
at any time outstanding.

     

    Interest
shall be paid at the interest rate being the sum of the relevant LIBOR or
EURIBOR as amongst banks prevailing plus the applicable margin of 35 basis
points (the “Interest Rate).

     

    We will
notify you in writing, not later than the first day of the interest period, of
the amount of interest payable in relation to such interest
period.  All accrued interest in relations to an interest period shall
be debited to the current account (the “Account) at the end of such interest
period.

     

    Interest
and any other payments under this clause of an annual nature shall accrue from
day to day and be calculated on the basis of the actual number of days elapsed
and a year of three hundred sixty (360) days.

     

    Interest
shall always be due and payable in arrears on the interest payment date, being
the last day of the relevant fixed interest period (the “Interest Period”),
pro-vided , however, that if an Interest Period would otherwise end on a day
which is not a banking day, that Interest Period shall be extended to the next
succeeding day which is a banking day, unless the result of such extension would
be to carry such Interest Period over into another calendar month, in which
event such Interest Period shall end of the preceding banking day.

     

    It is
agreed that the Interest Period for each Tranche of the loan will be fixed from
the day of the relevant drawdown for a period of three months.  The
Interest Periods will be automatically extended at the end of each of the
previous Interest Periods for another term of three months including the so far
accrued Interest. The extensions shall be repeated until the day of the
prospective delivery of the relevant Vessel.  In case the duration of
the last relevant Interest Period does not match the day of the delivery of the
relevant Vessel, the bank shall be entitled to amend the last Interest Periods
in order to adjust the maturity date to the date of the delivery of the relevant
Vessel.  The same procedure and periods shall be applied to the
collateral deposit.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    /Berenberg
Bank Logo/

    

    
      	
              Letter
      to Suresh Capital Maritime Partners Germany GmbH

               

            	
              Page
      3

              29
      November 2006

            

    

     

    In
addition, the bank shall be entitled to an arrangement fee amounting to EUR
15,000,000.00 which shall become due and payable upon acceptance of this credit
facility by you.  We shall have the right to debit your Account with
us accordingly.

     

    After
completion, however in any case no later than six months after the balance sheet
date, you will submit to us your respective audited annual accounts (in
fulfil-ment of the Bank’s statutory duties under § KWG to gain an up-to-date
view of the commercial situation).

     

    All other
credit terms and conditions will be agreed separately from case to
case.

     

    
      	
              Costs,
      Fees and Expenses

            

    

     

    You shall
pay to us on demand all reasonable fees, costs and expenses (including, without
limitation, out-of-pocket expenses, fees, costs and expenses of independent
advisers such as legal counsel to us, which independent advisers and fees shall
be approved by us)

     

    
      	
            	
              (i)

            	
              incurred
      by us in connection with the negotiation, preparation and execution of
      this credit facility, the collateral agreement (Declaration of Pledging
      for the Securities and Credit Balances of III to I Maritime Partners
      Cayman I, LP, Exhibit 1) and any related documents (such as legal
      opinions); and

            

    

     

    
      	
            	
              (ii)

            	
              incurred
      by us in connection with the4 preservation or enforcement of any of our
      rights arising from this faculty, the collateral agreement (Declaration of
      Pledging for the Securities and Credit Balances of III to I Maritime Partners
      Cayman I, LP as per Exhibit 1 hereto) and
      any related documents.

            

    

     

    You
hereby irrevocably authorize us to debit the Account up to the amount
necces-sary for the payment and/or reimbursement of the above fees, costs and
expenses.

     

    
      	
              Taxes

            

    

     

    All
amounts of whatsoever nature payable by you under this Credit Facility shall be
paid free and clear of and without any deduction for any and all present or
future taxes, levies, imposts, deductions, charges or withholdings (the
“Taxes”).

     

    If you
were required by law to deduct any Taxes from or in respect of any sum pay-able
to us hereunder, (i) the sum payable shall be increased as may be necessary so
that after making all required deductions we will receive an amount equal to the
sum we would have received, if no such deduction had been made; and (ii) you
shall make such deduction; and (iii) you shall pay the full amount deducted to
the relevant tax authorities in accordance with applicable tax
laws.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    /Berenberg
Bank Logo/

    

    
      	
              Letter
      to Suresh Capital Maritime Partners Germany GmbH

               

            	
              Page
      4

              29
      November 2006

            

    

     

    Within 30
days after the date of any payment of Taxes you will furnish to us, at the
address indicated herein, the original or a certified copy of a receipt
evidencing the payment thereof (to the extent that such receipt has been
provided by the relevant taxing authority).

     

    
      	
              Collateral

            

    

     

    For the
credit facility granted in this letter, you must provide the following item(s)
of collateral to the Bank:

     

    
      	
            	
              ·  

            	
              Declaration
      of pledging for the securities and credit balances kept with us under
      Master-No. 22820
      of III to I Maritime Partners Cayman I, LP (the “Pledgor”) in the form and
      substance as per Exhibit
      1, in two executed copies.

            

    

    
      	
               

            	
              Kindly
      forward all copies to the Pledgor and request that all copies will be
      re-turned to us duly signed.  We will send you a copy of the
      declaration which is meant for Pledgor’s files as soon as such copy will
      have been duly countersigned by us.

            

    

     

    Before
you draw on the credit facility agreed with this letter, we must have
re-   ceived the aforementioned duly signed collateral
agreements.

     

    This does
not affect our right to be provided with additional collateral, nor does this
effect our right to realize the collateral pursuant to the terms and conditions
stipu- lated in the relevant provisions or our General Business
Conditions.

     

    
      Conditions
Precedent

    

     

    Our
obligation to disburse the credit amount or parts thereof to you shall be
subject to the following conditions precedent the occurrence of which shall be
(to the extent applicable) proven by evidence to our satisfaction (each document
in form and sub-  stance to our satisfaction):

     

    
      	
            	
              ·  

            	
              Receipt
      of one executed copy of this Credit Facility Letter duly countersigned on
      your behalf by one or more authorized signatories and duly endorsed by and
      on behalf of Pledgor;

            

    

    
      	
            	
              ·  

            	
              Receipt
      of the declaration of pledging for the securities and credit balances
      (Exhibit 1) duly
      signed by and on behalf of Pledgor;

            

    

    
      	
            	
              ·  

            	
              Receipt
      of Process Agent agreement duly signed and executed on behalf of the
      Pledgor and duly countersigned by authorized representatives of the
      Process Agent;

            

    

    
    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    /Berenberg
Bank Logo/

    

    
      	
              Letter
      to Suresh Capital Maritime Partners Germany GmbH

               

            	
              Page
      5

              29
      November 2006

            

    

     

    
      
        	
              	
                ·  

              	
                Receipt
      of a legal opinion issued by a reputable law firm satisfactory to us, in
      the Cayman Islands (for the Pledgor) which shall be in form and substance
      satisfactory to us, particularly confirming, among other items, the
      validity and enforceability of the terms and conditions stipulated in this
      Letter Agreement and the declaration of pledging for the securities and
      credit balances (Ex-  hibit 1)
      and the existence and good standing for III to I Maritime Partners Cayman
      I, LP as the Pledgor, possessing the capacity to sue or be sued in its own
      name and having the power to own its assets and carry on its business as
      contemplated by the Loan Agreement as per the date
  hereof;

              

      

    

    
    

    
      	
            	
              ·  

            	
              Receipt
      of the opening balance sheet of Suresh Capital Maritime Partners Germany
      GmbH duly signed on your behalf;

            

    

    
      	
            	
              ·  

            	
              Three
      (3) days prior to the draw down of each Tranche we will receive a duly
      signed draw down notice which will include details as the amount to be
      drawn, the name or notation of the relevant Vessel and the special purpose
      of this Tranche;

            

    

    
      	
            	
              ·  

            	
              Prior
      to every draw down there shall be sufficient funds on the accounts of the
      Pledgor under master no. 22820 which funds shall at no time be less than
      100% of the amount outstanding and in addition 100% of the amount to be
      drawn on each of the relevant draw down
dates.

            

    

    

    
      	
              Events
      of Default

            

    

     

    Notwithstanding
the relevant provisions of our General Business Conditions, if any of, but not
limited to, the following events (“Event(s) of Default”) shall
occur and be continuing:

     

    
      	
            	
              a)  

            	
              if
      you fail to pay when due any principal or interest amounts or other sums
      pay-able hereunder within (5) Business Days of written notice of such
      failure from us;

            

    

    
      	
            	
              b)  

            	
              if
      you default in the performance or observance of any other obligation or
      term contained in this Credit Facility and such failure is not remedied
      within fifteen (15) Business Days of written notice of such failure from
      us;

            

    

    
      	
            	
              c)  

            	
              if
      the Credit Facility or part thereof has not been utilized for the purpose
      stipu-lated herein.

            

    

    
      	
            	
              d)  

            	
              if
      it becomes unlawful for you to pay your debts
  hereunder;

            

    

    
      	
            	
              e)  

            	
              if
      you, and/or the Pledgor (as the case may be), challenge or contest in any
      ac-tion, suit or proceeding the validity or enforceability of this Credit
      Facility, the validity or enforceability of any of the obligations or the
      validity or enforceability of the declaration of pledging for the
      securities and credit balances (Exhibit 1) or the perfection or priority
      of the relevant lien created for our
benefit;

            

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    /Berenberg
Bank Logo/

    

    
      	
              Letter
      to Suresh Capital Maritime Partners Germany GmbH

               

            	
              Page
      6

              29
      November 2006

            

    

    

    
      	
            	
              f)  

            	
              if
      a material adverse change with respect to your and/or Pledgor’s financial
      con-dition occurs which results, in our good faith credit judgment, in a
      material im-pairment of the repayment of the credit facility and/or the
      enforceability and/or realisation of the collateral
      respectively;

            

    

    
      	
            	
              g)  

            	
              if
      you or the Pledgor become or threaten to become insolvent or bankrupt or
      be-come or threaten to become unable to pay your or Pledgor’s debts as the
      ma-ture or make any composition with or assignment for the benefit of your
      or Pledgor’s creditors or apply for or consent to or sustain the
      appointment of a trustee or receiver in respect of your or Pledgor’s
      assets or a substantial part thereof or cease or threaten to case to carry
      on business;

            

    

    
      	
            	
              h)  

            	
              if
      without our prior written consent, there is any change in the ultimate
      beneficial ownership of Suresh Capital Maritime Partners Germany GmbH
      and/or III to I Maritime Partners Cayman I, LP causing loss of control by
      the main shareholders of its
founders;

            

    

    then, and
in any such event, we may declare this Credit Facility and all amounts pay-able
under this Letter Agreement including principal, interest and costs to be
forth-with due and payable, whereupon the respective amounts shall become and be
forthwith due and payable.

     

    
      	
              Statement
      under § 8 German Money Laundering Act
  (“Geldwäschegesetz”)

            

    

     

    With
regard to the German Money Laundering Act we assume on the basis of the
in-formation you provided when opening your account that you act in your own
name in taking out this credit.  If this is incorrect or if it changes
in the future, you will promptly inform us of this.

     

    
      	
              Governing
      law and legal venue

            

    

     

    This
agreement shall be governed by and construed in accordance with the laws of the
Federal Republic of Germany.  Non-exclusive place of jurisdiction for
all and any claims and disputes arising under and in connection with this
arrangement shall be Hamburg, Germany unless provided otherwise by mandatory
law.  Nothing in this creit facility shall affect our right to erve
legal process in any other manner permit- ted by law nor shall it affect our
right to bring any litigation, action or proceeding against you, and or the
Pledgor, or the respective property in the courts of other competent
jurisdictions.

     

    
      	
              No
      Waiver

            

    

     

    No
failure or delay on our part to exercise any power or right hereunder shall
operate as a waiver therof, nor shall any single or partial exercise by us of
any such power or right preclude any other or further exercises therof or the
exercise of any other     right.  The
remedies provided herein are cumulative and not exclusive of any reme-dies
provided by law.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    /Berenberg
Bank Logo/

    

    
      	
              Letter
      to Suresh Capital Maritime Partners Germany GmbH

               

            	
              Page
      7

              29
      November 2006

            

    

     

    
      	
              Severability

            

    

     

    If any of
the above provisions are or become invalid or unperformable as a whole or in any
part, then this shall not affect the remaining agreement set out
above.

     

    
      	
              Acceptance

            

    

     

    We
request that you confirm your acceptance of the contents of this letter by duly
signing the enclosed execution copies and returning to us one copy of it duly
signed on behalf of all relevant parties.

     

    
      
        
          
            
              
                
                  	
                          Yours
      faithfully

                        
	 
      	 
      
	
                          Joh.
      Berenberg, Gossler & Co. KG

                        
	 
      	 
      
	
                          /S/

                        	
                          /S/

                        
	
                          (Engelman)

                        	
                          (Speer)

                        

                

              

            

          

        

      

    

    Accepted:

    
      
        
          
            
              
                
                  
                    
                      
                        
                          	
                                  Place/date

                                	 	
                                  (Suresh
      Capital Maritime Partners Germany GmbH)

                                
	 
      	 	
                                  /S/

                                	 
      

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    Acknowledgement:

     

    We, the
Pledgor, acknowledge by signature the contents of this Letter Agreement and
confirm having received one copy of it for our files.

     

    
      
        
          
            
              
                
                  
                    
                      	
                              Place/date

                            	
                              (III
      to I Maritime Partners Cayman I, LP)

                            
	
                              Dallas,
      TX 11/30/06

                            	/S/	
                               

                            

                    

                  

                

              

            

          

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      Pledging
of credit balances

    

     

    
      	
              Between

            

    

     

    
      Joh.
Berenberg, Gossler & Co. KG

    

    
      Neuer
Jungfernstieg 20, 20354 Hamburg

    

    

    
      -
hereinafter the “Bank”

    

     

    
      and

    

     

    
      III to I
Maritime Partners Cayman I, L.P.

    

    
      c/o
Walkers SPV Limited

    

    
      Walker
House

    

    
      87 Mary
Street

    

    
      George
Town

    

    
      Grand
Cayman KY1-9002

    

    

    
      Cayman
Islands

    

    

    
      	
              -
      hereinafter the “Pledgor”

            

    

     

    
      	
            	
              1.  

            	
              Items
      pledged

            

    

     

    The
Pledgor hereby pledges all present and future payment claims against the Bank to
credit balances and interest in the account with the

     

    Master-No.
22820

     

    And all
and any present or future credit claims against the Bank.

     

    
      	
            	
              2.  

            	
              Purpose
      of collateral

            

    

     

    The
pledge secures the Bank’s claims under the credit granted in a certain letter
dd. 29 November 2006 (borrower:  Suresh Capital Maritime Partners
GmbH, Leer, Germany - hereinafter the Borrower -) under Master-No. 52751, even
if the agreed term is ex- tended or renewed.

    

    If the
Pledgor has assumed a liability for another customer’s liabilities (e.g. as
guaran-tor), then the pledge covers the debt arising out of this assumed
liability only as from the time at which it falls due.

     

    
      	
            	
              3.  

            	
              Bank’s
      right to realize items of
collateral

            

    

     

    
      	
            	
              (1)

            	
              The
      Bank shall be entitled to realize items of collateral if the Borrower is
      in default with due payments on the payment claims secured under this
      agreement.  The Bank will real-ise pledged items only to the
      extent necessary to satisfy the overdue payment
  claims.

            

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	
              (2)

            	
              The
      Bank shall warn the Pledgor in writing that it will realize the pledged
      items and shall fix a period of grace in the same letter.  If
      this agreement is a commercial transact-     tion
      for the Pledgor, the period of grace shall be no shorter than one
      week.  In all other cases it shall be one
  month.

            

    

     

    
      	
              4.  

            	
              Waiver
      of defences

            

    

     

    The
Pledgor cannot invoke the fact that the Bank is able to satisfy its claims by
setoff against the Borrower’s due payment claims (waiver of the Pledgor’s
defence of availabil-ity of setoff under §§ 1211, 770 Abs. 2 German Civil
Code).

     

    
      	
              5.  

            	
              Transfer
      of items of collateral

            

    

     

    
      	
              (1)

            	
              If
      the Pledgor has satisfied claims of the Bank covered by items of
      collateral, then the following shall apply:  the Pledgor shall
      be entitled to demand a transfer of items of col-lateral only if the
      claims secured by the pledge have been fully satisfied and the items of
      collateral to be transferred no longer serve to secure other claims of the
      Bank.

            

    

     

    
      	
              (2)

            	
              If
      items of collateral pass to the Pledgor by operation of the law, the
      appropriate law shall apply.  If the Bank’s claims exceed the
      realization proceeds and the items of collat-eral passing to the Pledgor
      by operation of the law also serve the purpose of securing the part of the
      claims not covered by the realization proceeds, then the Bank shall have a
      privileged right to satisfy its claims against the
  Pledgor.

            

    

     

    
      	
              6.  

            	
              Return

            

    

     

    After the
Bank’s claims secured by the pledge have been satisfied, the Bank shall
sur-render to the Pledgor the pledged items and any surplus realization
proceeds.  This shall not apply if pledge items are due to a third
party.

     

    
      	
              7.  

            	
              Governing
      law and legal venue

            

    

     

    This
agreement shall be governed by the laws of the Federal Republic of
Germany.  Place of jurisdiction for all and any claims and disputes
arising under this agreement shall be Hamburg unless provided otherwise by
mandatory law.  The Bank remains enti-tled to bring its claims in any
other court of competent jurisdiction.

     

    
      	
              8.  

            	
              Legal
      validity

            

    

     

    If any
term or condition hereof is invalid or is not performed, then this shall not
affect the validity of the remaining contents of this
agreement.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Declaration
under § GwG

     

    Act for
Tracking Profits from Serious Crimes (Money Laundering Act)

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              	
                                      O

                                    	
                                      Pledgor
      acts for its own account.

                                    
	 	 
	
                                      ü

                                    	
                                      Pledgor
      acts for a third party’s account.

                                    
	 	 
	 
      	
                                      /III
      to I Maritime Partners Cayman I, L.P./

                                    
	 
      	
                                      (Name
      and address of the third party for whose account the items are
      pledged)

                                    
	 	 
	 
      	
                                      /Walkers SPV Ltd.,
      Walker House, 87 Mary Street, George Town, Grand Cayan KY1-Cayman
      Islands/

                                    

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                	
                                        Place,
      date

                                      	 
      	
                                        III
      to I Maritime Partners Cayman I, L.P.

                                      
	 
      	 
      	 
      
	 	 	 
	
                                        /Dallas,
      TX 11/30/06/

                                      	 
      	
                                        /s/

                                      
	 
      	 
      	 
      
	 	 	 
	
                                        Hamburg,
      on

                                      	 
      	
                                        Joh.
      Berenberg, Gossler & Co. KG

                                      
	 	 	 
	
                                        /13.12.2006/

                                      	 
      	
                                        /s/

                                      
	 	 	 

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    Proof
of Pledgor’s identity

     

    ID card
(type of document, no. issued by, on / other form of proof of
identity).  An ID card must be presented unless the Pledgor is
personally known and proof of identity has been provided on opening the account
here in question.

     

    
      
        
          
            
              
                	
                        /13.12.2006/

                      	 	
                        /s/

                      
	 	 	 

              

            

          

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Amendment
Agreement No. 1

    to
the Pledging of credit balances dated 30 November/13 December
2006

     

    Between

     

    
      	
              Joh.
      Berenberg, Gossler & Co. KG

            

    

    
      	
              Neuer
      Jungfernstieg 20, 20354 Hamburg

            

    

    
      	
              -
      hereinafter the “Bank” -

            

    

     

      and

     

    
      	
              III
      to I Maritime Partners Cayman I,
L.P.

            

    

    
      	
              c/o
      Walkers SPV Limited

            

    

    
      	
              Walker
      House

            

    

    
      	
              87
      Mary Street

            

    

    
      	
              George
      Town

            

    

    
      	
              Grand
      Cayman KY1-9002

            

    

    

    
      	
              Cayman
      Islands

            

    

    
      	
              -
      hereinafter the “Pledgor” -

            

    

     

    
      	
              The
      following Clause shall be amended as
follows:

            

    

     

    
      	
              2. 

            	
              Purpose
      of collateral

            

    

     

    The
Pledge secures the Bank’s claims under the credit granted in a certain letter
dd. 29 November 2006 and Amendment Agreement No. 1 to the Credit Facility dated
13 March 2007 (borrower:  Suresh Capital Maritime Partners GmbH, Leer,
Germany - hereinafter the Borrower -) under Master-No. 52751, even if the agreed
term is ex-tended or renewed.

     

    If the
Pledgor has assumed a liability for another customer’s liabilities (e.g. as
guarantor), then the pledge covers the debt arising out of this assumed
liability only as from the time at which if falls due.

     

    
      All other
Clauses of the Pledging of credit balances shall remain
unchanged.

    

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              	
                                      Place,
      date

                                    	 
      	
                                      III
      to I Maritime Partners Cayman I, L.P.

                                    
	 	 	 
	
                                      /
      Dallas, TX  14, March 2007 /

                                    	 
      	
                                      /s/

                                    
	 
      	 
      	 
      
	 	 	 
	
                                      Hamburg,
      on

                                    	 
      	
                                      Joh.
      Berenberg, Gossler & Co. KG

                                    
	 	 	 
	
                                      /

                                    	 
      	
                                      /s/

                                    
	 	 	 

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Amendment
Agreement No. 2

    to
the Pledging of credit balances dated 30 November/13 December 2006
and

    Amendment
No. 1 dated 14 March/20 March 2007

     

    Between

     

    
      	
              Joh.
      Berenberg, Gossler & Co. KG

            

    

    
      	
              Neuer
      Jungfernstieg 20, 20354 Hamburg

            

    

    
      	
              -
      hereinafter the “Bank” -

            

    

     

    and

     

    
      	
              III
      to I Maritime Partners Cayman I,
L.P.

            

    

    
      	
              c/o
      Walkers SPV Limited

            

    

    
      	
              Walker
      House

            

    

    
      	
              87
      Mary Street

            

    

    
      	
              George
      Town

            

    

    
      	
              Grand
      Cayman KY1-9002

            

    

    

    
      	
              Cayman
      Islands

            

    

    
      	
              -
      hereinafter the “Pledgor” -

            

    

     

    
      	
              The
      following Clause shall be amended as
follows:

            

    

     

    
      	
              2.

            	
              Purpose
      of collateral

            

    

     

    The
Pledge secures the Bank’s claims under the credit granted in a certain letter
dd. 29 November 2006 and Amendment Agreement No. 1 to the Credit Facility dated
13 March 2007 and the Amendment No. 2 to the Credit Facility dated 4 May 2007
(bor-rower:  Suresh Capital Maritime Partners GmbH, Leer, Germany -
hereinafter the Bor-rower -) under Master-No. 52751, even if the agreed term is
ex-tended or renewed.

     

    If the
Pledgor has assumed a liability for another customer’s liabilities (e.g. as
guarantor), then the pledge covers the debt arising out of this assumed
liability only as from the time at which if falls due.

     

    
      All other
Clauses of the Pledging of credit balances shall remain
unchanged.

    

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                	
                                        Place,
      date

                                      	 	
                                        III
      to I Maritime Partners Cayman I, L.P.

                                      
	 	 	 
	
                                        /
      Dallas, TX  5/7/07 /

                                      	 	
                                        /s/

                                      
	 
      	 	 
      
	 	 	 
	
                                        Hamburg,
      on

                                      	 	
                                        Joh.
      Berenberg, Gossler & Co. KG

                                      
	 	 	 
	
                                        /

                                      	 	
                                        /s/

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"}]]