Document:

d913561_ex10-23.htm

    Exhibit
10.23

    

    

    

    
 

    

    

    Date      July
2008

    

    

    

    

    STAR
BULK CARRIERS CORP.

    as
Borrower

    

    - and
-

    

    

    PIRAEUS
BANK A.E.

    as
Lender

    

    

    

    

    
      

      LOANLOAN AGREEMENT

      

    

    

                                
relating to a loan facility of up to US$35,000,000

    to part
finance the acquisition cost of

    m.v.
“VICTORIA” (tbr “STAR COSMO”)

    

    

    

    
      
        
          WATSON,
FARLEY & WILLIAMS

          Piraeus

        

         

      

      
         

        
          

        

      

      
         

      

    

    

    INDEX

    

    Clause

    

 

    
      
        	
                1

              	
                INTERPRETATION

              	
                1

              
	
                2

              	
                FACILITY

              	
                13

              
	
                3

              	
                DRAWDOWN

              	
                14

              
	
                4

              	
                INTEREST

              	
                14

              
	
                5

              	
                INTEREST
      PERIODS

              	
                15

              
	
                6

              	
                DEFAULT
      INTEREST

              	
                16

              
	
                7

              	
                REPAYMENT
      AND PREPAYMENT

              	
                17

              
	
                8

              	
                CONDITIONS
      PRECEDENT

              	
                18

              
	
                9

              	
                REPRESENTATIONS
      AND WARRANTIES

              	
                19

              
	
                10

              	
                GENERAL
      UNDERTAKINGS

              	
                21

              
	
                11

              	
                CORPORATE
      UNDERTAKINGS

              	
                24

              
	
                12

              	
                INSURANCE

              	
                26

              
	
                13

              	
                SHIP
      COVENANTS

              	
                31

              
	
                14

              	
                SECURITY
      COVER

              	
                34

              
	
                15

              	
                PAYMENTS
      AND CALCULATIONS

              	
                35

              
	
                16

              	
                APPLICATION
      OF RECEIPTS

              	
                36

              
	
                17

              	
                APPLICATION
      OF EARNINGS

              	
                37

              
	
                18

              	
                EVENTS
      OF DEFAULT

              	
                38

              
	
                19

              	
                FEES
      AND EXPENSES

              	
                41

              
	
                20

              	
                INDEMNITIES

              	
                42

              
	
                21

              	
                NO
      SET-OFF OR TAX DEDUCTION

              	
                44

              
	
                22

              	
                ILLEGALITY,
      ETC

              	
                45

              
	
                23

              	
                INCREASED
      COSTS

              	
                45

              
	
                24

              	
                SET
      OFF

              	
                46

              
	
                25

              	
                TRANSFERS
      AND CHANGES IN LENDING OFFICE

              	
                47

              
	
                26

              	
                VARIATIONS
      AND WAIVERS

              	
                48

              
	
                27

              	
                NOTICES

              	
                48

              
	
                28

              	
                SUPPLEMENTAL

              	
                50

              
	
                29

              	
                LAW
      AND JURISDICTION

              	
                50

              
	
                SCHEDULE
      1  DRAWDOWN NOTICE

              	
                52

              
	SCHEDULE
      2  CONDITION PRECEDENT DOCUMENTS	 53
	SCHEDULE
      3  FORM OF COMPLIANCE CERTIFICATE	 56
	
                EXECUTION
      PAGE

              	 57

      

       

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

     

     

    

      THIS AGREEMENT is made
on    July 2008

      

      BETWEEN

      

      
        	
                (1)

              	
                STAR BULK CARRIERS CORP.
      as Borrower; and

              

      

       

      
        	
                (2)

              	
                PIRAEUS BANK A.E. as
      Lender.

              

      

       

      

      BACKGROUND

      

      The
Lender has agreed to make available to the Borrower a loan facility of up to
$35,000,000 (being approximately 55 per cent. of the purchase price of the Ship
payable pursuant to the MOA) for the purpose of assisting the Owner, a
wholly-owned subsidiary of the Borrower, in part-financing the purchase price of
the Ship.

      

      IT IS AGREED as
follows:

      

      
        	
                1

              	
                INTERPRETATION

              

      

       

      
        	
                1.1

              	
                Definitions.  Subject
      to Clause 1.5, in this Agreement:

              

      

       

      “Account Pledge” means a deed
creating security in respect of the Earnings Account in such form as the Lender
may approve or require;

       

      “Accounting
Information”  means the annual audited consolidated accounts to
be provided by the Borrower to the Lender in accordance with Clause 10.6(a) of
this Agreement or the semi-annual unaudited accounts to be provided by the
Borrower to the Lender in accordance with Clause 10.6(b) of this
Agreement;

       

      “Approved Manager” means Star
Bulk Management Inc., a corporation incorporated in the Republic of the Marshall
Islands having its registered office at Trust Company Complex, Ajeltake Road,
Ajeltake Island, Majuro, Marshall Islands MH96960, or any other company which
the Lender may, from time to time, approve as the manager of the
Ship;

       

      “Availability Period” means the
period commencing on the date of this Agreement and ending on:

       

      
        	
                 
      

              	
                (a)

              	
                30
      July 2008 (or such later date as the Lender may agree with the Borrower);
      or

              

      

       

      
        	
                 
      

              	
                (b)

              	
                if
      earlier, the date on which the Commitment is fully borrowed, cancelled or
      terminated;

              

      

       

      “Borrower” means Star Bulk
Carriers Corp., a corporation incorporated and existing under the laws of
Marshall Islands and having its registered office at Trust Company Complex,
Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH96960;

       

      “Business Day” means a day on
which banks are open in London, Piraeus and Athens and, in respect of a day on
which a payment is required to be made under a Finance Document, also in New
York City;

       

      “Charterer”  means
Korea Lines Corporation of Seoul, Korea;

       

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      “Charterparty
Assignment”  means an assignment of the rights of the Owner
under the Initial Charterparty or, as the case may be, any Future Charterparty
executed or, as the context may require, to be executed by the Owner in favour
of the Lender, in each case, in such form as the Lender may approve or
require;

       

      “Commitment” means $35,000,000,
as that amount may be reduced, cancelled or terminated in accordance with this
Agreement;

       

      “Compliance Certificate” means
a certificate in the form set out in Schedule 3 (or in any other form which the
Lender approves or requires);

       

      “Compliance
Date”  means 31 March, 30 June, 30 September and 31 December in
each calendar year (or such other dates as of which the Borrower prepares its
consolidated financial statements which it is required to deliver to the Lender
pursuant to Clause 10.6);

       

      “Contract
Price”  means $68,800,000 being the purchase price for “STAR
COSMO” payable by the Owner to the Seller pursuant to the MOA;

       

      “Contractual Currency” has the
meaning given in Clause 20.4;

       

      “Dollars” and “$” means the lawful currency
for the time being of the United States of America;

       

      “Drawdown Date” means the date
requested by the Borrower for the Loan to be made, or (as the context requires)
the date on which is actually made;

       

      “Drawdown Notice” means the
notice in the form set out in Schedule 1 (or in any other form which the Lender
approves or reasonably requires);

       

      “Earnings” means all moneys
whatsoever which are now, or later become, payable (actually or contingently) to
the Owner or the Lender and which arise out of the use or operation of the Ship,
including (but not limited to):

       

      
        
          	 	
                  (a)

                	
                  all
      freight, hire and passage moneys, compensation payable to the Owner in the
      event of requisition of the Ship for hire, remuneration for salvage and
      towage services, demurrage and detention moneys and damages for breach (or
      payments for variation or termination) of any charterparty or other
      contract for the employment of the Ship;

                
	 	 	 
	 	
                  (b)

                	
                  all
      moneys which are at any time payable under Insurances in respect of loss
      of earnings; and

                
	 	 	 
	
                   
      

                	
                  (c)

                	
                  if
      and whenever the Ship is employed on terms whereby any moneys falling
      within paragraphs (a) or (b) are pooled or shared with any other person,
      that proportion of the net receipts of the relevant pooling or sharing
      arrangement which is attributable to the
Ship;

                

        

         

      

      “Earnings
Account”  means an account in the name of the Owner with the
Lender designated “Star Cosmo LLC - Earnings Account” or any other account (with
that or another office of the Lender) which is designated by the Lender as the
Earnings Account for the purpose of this Agreement;

       

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      
 

      “EBITDA”  means, in
relation to a Compliance Date or for any accounting period, the consolidated net
income of the Group for that accounting period:

      

      
        	
                 
      

              	
                (a)

              	
                plus,
      to the extent deducted in computing consolidated net income of the Group
      for that accounting period, the sum, without duplication,
    of:

              

      

       

      
        	
                 
      

              	
                (i)

              	
                all
      federal, state, local and foreign taxes and tax
    distributions;

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                Net
      Interest Expenses; and

              

      

       

      
        	
                 
      

              	
                (iii)

              	
                depreciation,
      depletion, amortisation of intangibles and other non-cash charges or
      non-cash losses (including non-cash transaction expenses and the
      amortisation of debt discounts) and any extraordinary losses not incurred
      in the ordinary course of business;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                minus,
      to the extent added in computing consolidated net income of the Group for
      that accounting period, any non-cash income or non-cash gains and any
      extraordinary gains not incurred in the ordinary course of
      business;

              

      

       

      all
determined on a consolidated basis in accordance with generally accepted
accounting principles and as shown in the Accounting Information;

       

      “Environmental Claim”
means:

       

      
        	
                 
      

              	
                (a)

              	
                any
      claim by any governmental, judicial or regulatory authority which arises
      out of an Environmental Incident or an alleged Environmental Incident or
      which relates to any Environmental Law;
or

              

      

       

      
        	
                 
      

              	
                (b)

              	
                any
      claim by any other person which relates to an Environmental Incident or to
      an alleged Environmental Incident,

              

      

       

      and
“claim” means a claim
for damages, compensation, fines, penalties or any other payment of any kind,
whether or not similar to the foregoing; an order or direction to take, or not
to take, certain action or to desist from or suspend certain action; and any
form of enforcement or regulatory action, including the arrest or attachment of
any asset;

       

      “Environmental
Incident” means:

       

      
        	
                 
      

              	
                (a)

              	
                any
      release of Environmentally Sensitive Material from the Ship;
      or

              

      

       

      
        	
                 
      

              	
                (b)

              	
                any
      incident in which Environmentally Sensitive Material is released from a
      vessel other than the Ship and which involves a collision between the Ship
      and such other vessel or some other incident of navigation or operation,
      in either case, in connection with which the Ship is actually or
      potentially liable to be arrested, attached, detained or injuncted and/or
      the Ship and/or the Owner and/or any operator or manager of the Ship is at
      fault or allegedly at fault or otherwise liable to any legal or
      administrative action; or

              

      

       

      
        	
                 
      

              	
                (c)

              	
                any
      other incident in which Environmentally Sensitive Material is released
      otherwise than from the Ship and in connection with which the Ship is
      actually or potentially liable to be arrested and/or where the Owner
      and/or any operator or manager of the Ship is at fault or allegedly at
      fault or otherwise liable to any legal or administrative
      action;

              

      

       

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      “Environmental Law” means any
law relating to pollution or protection of the environment, to the carriage of
Environmentally Sensitive Material or to actual or threatened releases of
Environmentally Sensitive Material;

       

      “Environmentally Sensitive
Material” means oil, oil products and any other substance (including any
chemical, gas or other hazardous or noxious substance) which is (or is capable
of being or becoming) polluting, toxic or hazardous;

       

      “Event of Default” means any of
the events or circumstances described in Clause 18.1;

       

      “Finance
Documents”  means:

       

      
        	
                 
      

              	
                (a)

              	
                this
      Agreement;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                the
      Guarantee;

              

      

       

      
        	
                 
      

              	
                (c)

              	
                the
      Mortgage;

              

      

       

      
        	
                 
      

              	
                (d)

              	
                the
      General Assignment;

              

      

       

      
        	
                 
      

              	
                (e)

              	
                the
      Account Pledge;

              

      

       

      
        	
                 
      

              	
                (f)

              	
                the
      Manager’s Undertaking;

              

      

       

      
        	
                 
      

              	
                (g)

              	
                any
      Charterparty Assignment; and

              
	 	 	 
	 	
                (h)

              	
                any
      other document (whether creating a Security Interest or not) which is
      executed at any time by the Borrower, the Owner or any other person as
      security for, or to establish any form of subordination or priorities
      arrangement in relation to, any amount payable to the Lender under this
      Agreement or any of the other documents referred to in this
      definition;

              

      

       

      “Financial Indebtedness” means,
in relation to a person (the “debtor”), a liability of the
debtor:

       

      
        	 	
                (a)

              	
                for
      principal, interest or any other sum payable in respect of any moneys
      borrowed or raised by the debtor;

              
	 	 	 
	
                 
      

              	
                (b)

              	
                under
      any loan stock, bond, note or other security issued by the
      debtor;

              

      

       

      
        	
                 
      

              	
                (c)

              	
                under
      any acceptance credit, guarantee or letter of credit facility made
      available to the debtor;

              

      

       

      
        	
                 
      

              	
                (d)

              	
                under
      a financial lease, a deferred purchase consideration arrangement or any
      other agreement having the commercial effect of a borrowing or raising of
      money by the debtor;

              
	 	 	 
	 	
                (e)

              	
                under
      any foreign exchange transaction, any interest or currency swap or any
      other kind of derivative transaction entered into by the debtor or, if the
      agreement under which any such transaction is entered into requires
      netting of mutual liabilities, the liability of the debtor for the net
      amount; or

              

      

       

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (f)

              	
                under
      a guarantee, indemnity or similar obligation entered into by the debtor in
      respect of a liability of another person which would fall within (a) to
      (e) if the references to the debtor referred to the other
      person;

              

      

       

      “Fleet
Vessels”  means, together, all of the vessels (including, but
not limited to, the Ship) from time to time owned by members of the Group and,
in the singular, means any of them;

       

      “Future
Charterparty”  means any time charterparty, consecutive voyage
charter or contract of affreightment in respect of the Ship (other than the
Initial Charterparty) of a duration (or capable of being or exceeding a
duration) of 11 months or more and any guarantee of such charter or other
contract of employment in respect of the Ship to be entered into by the Owner
and a charterer approved by the Lender in form and substance satisfactory to the
Lender;

       

      “GAAP”  means
generally accepted accounting principles as from time to time in effect in the
United States of America;

       

      “General Assignment” means a
general assignment of the Earnings, the Insurances and any Requisition
Compensation of the Ship, in such form as the Lender may approve or
require;

       

      “Group” means, together, the
Borrower, the Owner and all their respective subsidiaries and any other
companies in the same beneficial ownership as the Borrower and/or the
Owner;

       

      “Guarantee”  means a
guarantee of the Borrower’s obligations under this Agreement and the other
Finance Documents to which it is a party executed or to be executed by the Owner
in favour of the Lender in such form as the Lender shall approve or
require;

       

      
        	
                 
      

              	
                “IACS”  means
      the International Association of Classification
  Societies;

              

      

      

      
        	
                 
      

              	
                “Initial Charterparty”  means
      the time charterparty dated 7 March 2008 in relation to the Ship made
      between the Seller and the Charterer as amended and supplemented by a
      novation agreement dated 5 June 2008 made between the Owner, the Seller
      and the Charterer pursuant to which the Seller has novated that
      charterparty in favour of the
Owner;

              

      

      

      “Insurances”
means:

       

      
        	
                 
      

              	
                (a)

              	
                all
      policies and contracts of insurance (including in respect of hull and
      machinery risks), including entries of the Ship in any protection and
      indemnity or war risks association, which are effected in respect of the
      Ship, her Earnings or otherwise in relation to her;
  and

              

      

       

      
        	
                 
      

              	
                (b)

              	
                all
      rights and other assets relating to, or derived from, any of the
      foregoing, including any rights to a return of a
  premium;

              

      

       

      “Interest Period” means a
period determined in accordance with Clause 5;

       

      “ISM Code” means, in relation
to its application to the Owner, the Ship and its operation:

       

      
        	
                 
      

              	
                (a)

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

              

      

       

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (b)

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

              

      

       

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

       

      “ISM Code Documentation”
includes:

       

      
        	
                 
      

              	
                (a)

              	
                the
      document of compliance (DOC) and safety management certificate (SMC)
      issued pursuant to the ISM Code in relation to the Ship within the periods
      specified by the ISM Code; and

              

      

       

      
        	
                 
      

              	
                (b)

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

              

      

       

      
        	
                 
      

              	
                (c)

              	
                any
      other documents which are prepared or which are otherwise relevant to
      establish and maintain the Ship’s or the compliance of the Owner with the
      ISM Code which the Lender may
require;

              

      

       

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

       

      “ISPS Code”  means
the International Ship and Port Facility Security Code constituted pursuant to
resolution A.924(22) of the International Maritime Organisation (“IMO”) now set
out in Chapter XI-2 of the Safety of Life at Sea Convention (SOLAS) 1974 (as
amended) and the mandatory ISPS Code as adopted by a Diplomatic Conference of
the IMO on Maritime Security in December 2002 and includes any amendments or
extensions to it and any regulation issued pursuant to it but shall only apply
insofar as it is applicable law in the Ship’s flag state and any jurisdiction on
which the Ship is operated;

       

      “ISPS Code
Documentation”  includes:

       

      
        	
                 
      

              	
                (a)

              	
                the
      International Ship Security Certificate issued pursuant to the ISPS Code
      in relation to the Ship within the period specified in the ISPS Code;
      and

              

      

       

      
        	
                 
      

              	
                (b)

              	
                all
      other documents and data which are relevant to the ISPS Code and its
      implementation and verification which the Lender may
    require;

              

      

       

      “ISSC”  means a valid
and current International Ship Security Certificate issued under the ISPS
Code;

       

      “Lender” means Piraeus Bank
A.E. acting through its office at 47-49 Akti Miaouli, Piraeus, Greece (or
through another branch notified to the Borrower under Clause 25.6) or its
successor or assign;

       

      “Leverage Ratio” means, at any
relevant time, the ratio of:

       

      
        	
                 
      

              	
                (a)

              	
                the
      Total Liabilities (less all Liquid Funds);
and

              

      

       

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (b)

              	
                the
      Market Value Adjusted Total Assets (including, without limitation, the
      Ship);

              

      

       

      “LIBOR”  means, for
an Interest Period:

       

      
        	
                 
      

              	
                (a)

              	
                the
      rate per annum equal to the offered quotation for deposits in Dollars for
      a period equal to, or as near as possible equal to, the relevant Interest
      Period which appears on REUTERS BBA Page LIBOR 01 at or about 11.00 a.m.
      (London time) on the second Business Day prior to the commencement of that
      Interest Period (and, for the purposes of this Agreement, “REUTERS BBA
      Page LIBOR 01” means the display designated as “REUTERS BBA Page LIBOR 01”
      on the Reuters Money News Services or such other page as may replace
      REUTERS BBA Page LIBOR 01 on that service for the purpose of displaying
      rates comparable to that rate or on such other service as may be nominated
      by the British Bankers’ Association for the purpose of displaying British
      Bankers’ Association Interest Settlement Rates for Dollars);
      or

              

      

       

      
        	
                 
      

              	
                (b)

              	
                if
      no rate is quoted on REUTERS BBA Page LIBOR 01, the rate per annum
      determined by the Lender to be the arithmetic mean of the rates per annum
      at which deposits in Dollars are offered to the Lender by leading banks in
      the London Interbank Market at the Lender’s request of or about 11.00 a.m.
      (London time) on the Quotation Date for that Interest Period for a period
      equal to that Interest Period and for delivery on the first Business Day
      of it;

              

      

       

      “Liquid Funds” means, in
respect of the relevant period, the aggregate of cash in hand held by members of
the Group with banks or other financial institutions of at least investment
grade rating which is free of any Security Interest;

       

      “Loan” means the principal
amount for the time being outstanding under this Agreement;

       

      “Major Casualty” means any
casualty to the Ship in respect of which the claim or the aggregate of the
claims against all insurers, before adjustment for any relevant franchise or
deductible, exceeds $250,000 or the equivalent in any other
currency;

       

      “Management
Agreement”  means an agreement made or to be made between the
Owner and the Approved Manager in respect of the commercial and/or technical
management of the Ship to be in form and substance in every respect satisfactory
to the Lender;

       

      “Manager’s
Undertaking”  means an undertaking to be issued by the Approved
Manager agreeing certain matters in relation to the management of the Ship to be
such form as the Lender may approve or require;

       

      “Margin”  means 1.325
per cent. per annum;

      

      “Market
Value”  means, in relation to the Ship and each Fleet Vessel
the market value thereof calculated  in accordance with Clause
14.4;

       

      “Market Value Adjusted Total
Assets”  means, at any time, Total Assets adjusted to reflect
the difference between the book values of all Fleet Vessels and the aggregate
Market Value of all Fleet Vessels and lease transactions relating to any Fleet
Vessels;

       

      “MOA” means the memorandum of
agreement dated 22 May 2008 as amended and supplemented by addendum No.1 dated 1
June 2008, each entered into between the Seller and the Owner in respect of the
sale of the Ship;

       

       

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

       

      “Mortgage” means the first
preferred Marshall Islands ship mortgage on the Ship, in such form as the Lender
may approve or require;

       

      “Negotiation Period” has the
meaning given in Clause 4.6;

       

      “Net Interest
Expenses”  means, as of any Compliance Date, the aggregate of
all interest, commitment and other fees, commissions, discounts and other costs,
charges or expenses accruing due from all the members of the Group during that
accounting period less interest income received, determined on a consolidated
basis in accordance with generally accepted accounting principles and as shown
in the Accounting Information;

       

      “Owner”  means Star
Cosmo LLC, a limited liability company formed in the Republic of the Marshall
Islands and having its registered office at Trust Company Complex, Ajeltake
Road, Ajeltake Island, Majuro, Marshall Islands MH96960;

       

      “Payment Currency” has the
meaning given in Clause 20.4;

       

      “Permitted Security Interests”
means:

       

      
        	
                 
      

              	
                (a)

              	
                Security
      Interests created by the Finance
Documents;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                liens
      for unpaid master’s and crew’s wages in accordance with usual maritime
      practice;

              

      

       

      
        	
                 
      

              	
                (c)

              	
                liens
      for salvage;

              

      

       

      
        	
                 
      

              	
                (d)

              	
                liens
      arising by operation of law for not more than 2 months’ prepaid hire
      under any charter in relation to the Ship not prohibited by this
      Agreement;

              

      

       

      
        	
                 
      

              	
                (e)

              	
                liens
      for master’s disbursements incurred in the ordinary course of trading and
      any other lien arising by operation of law or otherwise in the ordinary
      course of the operation, repair or maintenance of the Ship, provided such
      liens do not secure amounts more than 30 days overdue (unless the
      overdue amount is being contested by the Owner in good faith by
      appropriate steps) and subject, in the case of liens for repair or
      maintenance, to Clause 13.12(h);

              

      

       

      
        	
                 
      

              	
                (f)

              	
                any
      Security Interest created in favour of a plaintiff or defendant in any
      action of the court or tribunal before whom such action is brought as
      security for costs and expenses where the Owner is prosecuting or
      defending such other than in good faith by appropriate steps;
      and

              

      

       

      
        	
                 
      

              	
                (g)

              	
                Security
      Interests arising by operation of law in respect of taxes which are not
      overdue for payment other than taxes being contested in good faith by
      appropriate steps and in respect of which appropriate reserves have been
      made;

              

      

       

       “Pertinent Jurisdiction”, in
relation to a company, means:

       

      
        	
                 
      

              	
                (a)

              	
                England
      and Wales;

              
	 	 	 
	 	
                (b)

              	
                the
      country under the laws of which the company is incorporated or
      formed;

              

      

       

      
        	 	
                (c)

              	
                a
      country in which the company's central management and control is or has
      recently been exercised;

              
	 	 	 

      

       

       

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

       

      
        	
                 
      

              	
                (d)

              	
                a
      country in which the overall net income of the company is subject to
      corporation tax, income tax or any similar
tax;

              

      

       

      
        	
                 
      

              	
                (e)

              	
                a
      country in which assets of the company (other than securities issued by,
      or loans to, related companies) having a substantial value are situated,
      in which the company maintains a permanent place of business, or in which
      a Security Interest created by the company must or should be registered in
      order to ensure its validity or priority;
and

              

      

       

      
        	
                 
      

              	
                (f)

              	
                a
      country the courts of which have jurisdiction to make a winding up,
      administration or similar order in relation to the company or which would
      have such jurisdiction if their assistance were requested by the courts of
      a country referred to in paragraphs (b) or (c)
  above;

              

      

       

      “Potential Event of Default”
means an event or circumstance which, with the giving of any notice, the lapse
of time, a determination of the Lender and/or the satisfaction of any other
condition, would constitute an Event of Default;

       

      “Quotation Date” means, in
relation to any Interest Period (or any other period for which an interest rate
is to be determined under any provision of a Finance Document), the day on which
quotations would ordinarily be given by leading banks in the London Interbank
Market for deposits in the currency in relation to which such rate is to be
determined for delivery on the first day of that Interest Period or other
period;

       

      “Relevant Person” has the
meaning given in Clause 18.7;

       

      “Repayment Date” means a date
on which a repayment is required to be made under Clause 8;

       

      “Requisition Compensation”
includes all compensation or other moneys payable by reason of any act or event
such as is referred to in paragraph (b) of the definition of “Total
Loss”;

       

      “Secured Liabilities” means all
liabilities which the Borrower, the Security Parties or any of them have, at the
date of this Agreement or at any later time or times, under or in connection
with any Finance Document or any judgment relating to any Finance Document; and
for this purpose, there shall be disregarded any total or partial discharge of
these liabilities, or variation of their terms, which is effected by, or in
connection with, any bankruptcy, liquidation, arrangement or other procedure
under the insolvency laws of any country;

       

      “Security Cover
Percentage”  means, at any relevant time, the aggregate of the
amounts referred in paragraphs (a) and (b) of Clause 14.1 expressed as a
percentage of the Loan;

       

      “Security Interest”
means:

       

      
        	
                 
      

              	
                (a)

              	
                a
      mortgage, charge (whether fixed or floating) or pledge, any maritime or
      other lien or any other security interest of any
  kind;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                the
      security rights of a plaintiff under an action in rem; and

              
	 	 	 

      

       

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

       

      
        	 	
                (c)

              	
                any
      arrangement entered into by a person (A) the effect of which is to place
      another person (B) in a position which is similar, in economic terms, to
      the position in which B would have been had he held a security interest
      over an asset of A; but this paragraph (c) does not apply to a right of
      set off or combination of accounts conferred by the standard terms of
      business of a bank or financial
institution;

              

      

       

      “Security Party” means the
Owner, the Approved Manager and any other person (except the Lender) who, as a
surety or mortgagor, as a party to any subordination or priorities arrangement,
or in any similar capacity, executes a document falling within the final
paragraph of the definition of “Finance Documents”;

       

      “Security Period” means the
period commencing on the date of this Agreement and ending on the date on which
the Lender notifies the Borrower and the Security Parties that:

       

      
        	
                 
      

              	
                (a)

              	
                all
      amounts which have become due for payment by the Borrower or any Security
      Party under the Finance Documents have been
  paid;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                no
      amount is owing or has accrued (without yet having become due for payment)
      under any Finance Document;

              

      

       

      
        	
                 
      

              	
                (c)

              	
                neither
      the Borrower nor any Security Party has any future or contingent liability
      under Clause 19, 20, or 21 or any other provision of this Agreement or
      another Finance Document; and

              

      

       

      
        	
                 
      

              	
                (d)

              	
                the
      Lender does not consider that there is a significant risk that any payment
      or transaction under a Finance Document would be set aside, or would have
      to be reversed or adjusted, in any present or possible future bankruptcy
      of the Borrower or a Security Party or in any present or possible future
      proceeding relating to a Finance Document or any asset covered (or
      previously covered) by a Security Interest created by a Finance
      Document;

              

      

       

      “Seller” means Empress Holding
Limited, a corporation incorporated and existing under the laws of Marshall
Islands and having its registered office at Trust Company Complex, Ajeltake
Road, Ajeltake Island, Majuro, Marshall Islands MH96960;

      

      “Ship”  means the
2005-built bulk carrier of 52,200 metric deadweight tons currently registered in
the ownership of the Seller under the Marshall Islands flag with the name
“VICTORIA” to be acquired by the Owner pursuant to the MOA and registered in the
ownership of the Owner under the same flag with the name “STAR
COSMO”;

       

      “Total Assets” means, as of any
Compliance Date, the aggregate value of all assets of the Group included in the
most recent Accounting Information as “current assets” and the value of all
investments (valued in accordance with GAAP) and all other tangible and
intangible assets of the Group properly included in the most recent Accounting
Information as “fixed assets” in accordance with GAAP;

      

      “Total Liabilities” means, as
of any Compliance Date, the total liabilities of the Group as at that Compliance
Date as shown in the most recent Accounting Information delivered by the
Borrower pursuant to Clause 10.6;

       

      “Total Loss”
means:

       

      
        	
                 
      

              	
                (a)

              	
                actual,
      constructive, compromised, agreed or arranged total loss of the
      Ship;

              
	 	 	 

      

       

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

       

      
        	 	
                (b)

              	
                any
      expropriation, confiscation, requisition or acquisition of the Ship,
      whether for full consideration, a consideration less than her proper
      value, a nominal consideration or without any consideration, which is
      effected by any government or official authority or by any person or
      persons claiming to be or to represent a government or official authority
      (excluding a requisition for hire for a fixed period not exceeding 1 year
      without any right to an extension);
and

              

      

       

      
        	
                 
      

              	
                (c)

              	
                any
      condemnation of the Ship by any tribunal or by any person or persons
      claiming to be a
tribunal;  and

              

      

       

      
        	
                 
      

              	
                (d)

              	
                any
      arrest, capture, seizure or detention of the Ship (including any hijacking
      or theft) unless she is within 30 days redelivered to the full control of
      the Owner;

              

      

       

      “Total Loss Date”
means:

       

      
        	
                 
      

              	
                (a)

              	
                in
      the case of an actual loss of the Ship, the date on which it occurred or,
      if that is unknown, the date when the Ship was last heard
    of;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                in
      the case of a constructive, compromised, agreed or arranged total loss of
      the Ship, the earliest of:

              

      

       

      
        	
                 
      

              	
                (i)

              	
                the
      date on which a notice of abandonment is given to the insurers;
      and

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                the
      date of any compromise, arrangement or agreement made by or on behalf of
      the Owner with the Ship's insurers in which the insurers agree to treat
      the Ship as a total loss; and

              

      

       

      
        	
                 
      

              	
                (c)

              	
                in
      the case of any other type of total loss, on the date (or the most likely
      date) on which it appears to the Lender that the event constituting the
      total loss occurred.

              

      

       

      
        	
                1.2

              	
                Construction of certain
      terms.  In this
Agreement:

              

      

       

      “approved” means, for the
purposes of Clause 12, approved in writing by the Lender;

       

      “asset” includes every kind of
property, asset, interest or right, including any present, future or contingent
right to any revenues or other payment;

       

      “company” includes any
partnership, joint venture and unincorporated association;

       

      “consent” includes an
authorisation, consent, approval, resolution, licence, exemption, filing,
registration, notarisation and legalisation;

       

      “contingent liability” means a
liability which is not certain to arise and/or the amount of which remains
unascertained;

       

      “document” includes a deed;
also a letter, fax or telex;

       

      “excess risks” means the
proportion of claims for general average, salvage and salvage charges not
recoverable under the hull and machinery policies in respect of the Ship in
consequence of its insured value being less than the value at which the Ship is
assessed for the purpose of such claims;

       

      “expense” means any kind of
cost, charge or expense (including all legal costs, charges and expenses) and
any applicable value added or other tax;

       

       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

       

      “law” includes any form of
delegated legislation, any order or decree, any treaty or international
convention and any regulation or resolution of the Council of the European
Union, the European Commission, the United Nations or its Security
Council;

       

      “legal or administrative
action” means any legal proceeding or arbitration and any administrative
or regulatory action or investigation;

       

      “liability” includes every kind
of debt or liability (present or future, certain or contingent), whether
incurred as principal or surety or otherwise;

       

      “months” shall be construed in
accordance with Clause 1.3;

       

      “obligatory insurances” means
all insurances effected, or which the Owner is obliged to effect, under Clause
12 or any other provision of this Agreement or another Finance
Document;

       

      “parent company” has the
meaning given in Clause 1.4;

       

      “person” includes any company;
any state, political sub-division of a state and local or municipal authority;
and any international organisation;

       

      “policy”, in relation to any
insurance, includes a slip, cover note, certificate of entry or other document
evidencing the contract of insurance or its terms;

       

      “protection and indemnity
risks” means the usual risks covered by a protection and indemnity
association managed in London, including pollution risks and the proportion (if
any) of any sums payable to any other person or persons in case of collision
which are not recoverable under the hull and machinery policies by reason of the
incorporation in them of clause 1 of the Institute Time Clauses (Hulls)(1/10/83)
or clause 8 of the Institute Time Clauses (Hulls)(1/11/1995) or the Institute
Amended Running Down Clause (1/10/71) or any equivalent provision;

       

      “regulation” includes any
regulation, rule, official directive, request or guideline whether or not having
the force of law of any governmental, intergovernmental or supranational body,
agency, department or regulatory, self-regulatory or other authority or
organisation;

       

      “subsidiary” has the meaning
given in Clause 1.4;

       

      “tax” includes any present or
future tax, duty, impost, levy or charge of any kind which is imposed by any
state, any political sub-division of a state or any local or municipal authority
(including any such imposed in connection with exchange controls), and any
connected penalty, interest or fine; and

       

      “war risks” includes the risk
of mines and all risks excluded by clause 23 of the Institute Time Clauses
(Hulls)(1/10/83) or clause 24 of the Institute Time Clauses
(Hulls)(1/11/1995).

       

      
        	
                1.3

              	
                Meaning of
      “month”.  A period of one or more “months” ends on the day
      in the relevant calendar month numerically corresponding to the day of the
      calendar month on which the period started (“the numerically corresponding
      day”), but:

              

      

       

      
        	
                (a)

              	
                on
      the Business Day following the numerically corresponding day if the
      numerically corresponding day is not a Business Day or, if there is no
      later Business Day in the same calendar month, on the Business Day
      preceding the numerically corresponding day;
or

              

      

       

       

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

       

      
        	
                (b)

              	
                on
      the last Business Day in the relevant calendar month, if the period
      started on the last Business Day in a calendar month or if the last
      calendar month of the period has no numerically corresponding
      day,

              

      

       

      and
“month” and “monthly” shall be construed
accordingly.

       

      
        	
                1.4

              	
                Meaning of
      “subsidiary”.  A company (S) is a subsidiary of another
      company (P) if:

              

      

       

      
        	
                (a)

              	
                a
      majority of the issued shares in S (or a majority of the issued shares in
      S which carry unlimited rights to capital and income distributions) are
      directly owned by P or are indirectly attributable to P;
  or

              

      

       

      
        	
                (b)

              	
                P
      has direct or indirect control over a majority of the voting rights
      attaching to the issued shares of S;
or

              

      

       

      
        	
                (c)

              	
                P
      has the direct or indirect power to appoint or remove a majority of the
      directors of S; or

              

      

       

      
        	
                (d)

              	
                P
      otherwise has the direct or indirect power to ensure that the affairs of S
      are conducted in accordance with the wishes of
  P,

              

      

       

      and
any company of which S is a subsidiary is a parent company of S.

       

      
        	
                1.5

              	
                General
      Interpretation.  In this
  Agreement:

              

      

       

      
        	
                (a)

              	
                references
      in Clause 1.1 to a Finance Document or any other document being in a
      particular form include references to that form with any modifications to
      that form which the Lender approves or reasonably
  requires;

              

      

       

      
        	
                (b)

              	
                references
      to, or to a provision of, a Finance Document or any other document are
      references to it as amended or supplemented, whether before the date of
      this Agreement or otherwise;

              

      

       

      
        	
                (c)

              	
                references
      to, or to a provision of, any law include any amendment, extension,
      re-enactment or replacement, whether made before the date of this
      Agreement or otherwise;

              

      

       

      
        	
                (d)

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

              

      

       

      
        	
                (e)

              	
                Clauses
      1.1 to 1.5 apply unless the contrary intention
  appears.

              

      

       

      
        	
                1.6

              	
                Headings.  In
      interpreting a Finance Document or any provision of a Finance Document,
      all clause, sub-clause and other headings in that and any other Finance
      Document shall be entirely
disregarded.

              

      

       

      
        	
                2

              	
                FACILITY

              

      

       

      
        	
                2.1

              	
                Amount of
      facility.  Subject to the other provisions of this
      Agreement, the Lender shall make available to the Borrower, in a single
      advance, a loan facility of up to $35,000,000 (being approximately 55 per
      cent. of the Contract Price).

              

      

       

      
        	
                2.2

              	
                Purpose of Loan. The
      Borrower undertakes with the Lender to use the Loan only for the purpose
      stated in the preamble to this Agreement and Clause
  3.2.

              

      

       

       

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

       

      
        	
                3

              	
                DRAWDOWN

              

      

       

      
        	
                3.1

              	
                Request for
      Loan.  Subject to the following conditions, the Borrower
      may request the Loan to be advanced by ensuring that the Lender receives
      the completed Drawdown Notice not later than 11.00 a.m. (Piraeus time) 3
      Business Days prior to the intended Drawdown
  Date.

              

      

       

      
        	
                3.2

              	
                Availability.  The
      conditions referred to in Clause 3.1 are
that:

              

      

       

      
        	
                (a)

              	
                the
      Drawdown Date has to be a Business Day during the Availability
      Period;

              

      

       

      
        	
                (b)

              	
                the
      Loan shall be on-lent by the Borrower to the Owner and shall be used for
      the purpose of part-financing the Contract Price of the
    Ship;

              

      

       

      
        	
                (c)

              	
                the
      Loan shall be in an amount not exceeding $35,000,000 (being approximately
      55 per cent. of the Contract Price of the Ship payable pursuant to the
      MOA); and

              

      

       

      
        	
                (d)

              	
                the
      Loan shall not exceed the
Commitment.

              

      

       

      
        	
                3.3

              	
                Drawdown Notice
      irrevocable.  The Drawdown Notice must be signed by an
      authorised signatory or director of the Borrower; and once served, the
      Drawdown Notice cannot be revoked without the prior consent of the
      Lender.

              

      

       

      
        	
                3.4

              	
                Disbursement of
      Loan.  Subject to the provisions of this Agreement, the
      Lender shall on the Drawdown Date advance the Loan to the Borrower; and
      payment to the Borrower shall be made to the account of the Seller which
      the Borrower specifies in the Drawdown
Notice.

              

      

       

      
        	
                3.5

              	
                Disbursement of Loan to third
      party.  The payment by the Lender under Clause 3.4
      shall constitute the advance of the Loan and the Borrower shall at that
      time become indebted, as principal and direct obligor, to the Lender in an
      amount equal to the Loan.

              

      

       

      
        	
                4

              	
                INTEREST

              

      

       

      
        	
                4.1

              	
                Payment of normal
      interest.  Subject to the provisions of this Agreement,
      interest on the Loan in respect of each Interest Period shall be paid by
      the Borrower on the last day of that Interest
  Period.

              

      

       

      
        	
                4.2

              	
                Normal rate of
      interest.  Subject to the terms of this Agreement, the
      rate of interest applicable to the Loan (or any part thereof) for each
      Interest Period relating thereto shall be the aggregate of (i) the Margin
      and (ii) LIBOR for that Interest
Period.

              

      

       

      
        	
                4.3

              	
                Payment of accrued
      interest.  In the case of an Interest Period longer than
      3 months, accrued interest shall be paid every 3 months during that
      Interest Period and on the last day of that Interest
    Period.

              

      

       

      
        	
                4.4

              	
                Notification of market
      disruption.  The Lender shall promptly notify the
      Borrower if no rate is quoted on Reuters BBA Page LIBOR 01 or if for any
      reason the Lender is unable to obtain Dollars in the London Interbank
      Market in order to fund the Loan (or any part of it) during any Interest
      Period, stating the circumstances which have caused such notice to be
      given.

              

      

       

       

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

       

      
        	
                4.5

              	
                Suspension of
      drawdown.  If the Lender's notice under Clause 4.4
      is served before the Loan is made, the Lender's obligation to make the
      Loan shall be suspended while the circumstances referred to in the
      Lender's notice continue.

              

      

       

      
        	
                4.6

              	
                Negotiation of alternative rate
      of interest.  If the Lender’s notice under
      Clause 4.4 is served after the Loan is made, the Borrower and the
      Lender shall use reasonable endeavours to agree, within the 30 days after
      the date on which the Lender serves its notice under Clause 4.4 (the
      “Negotiation
      Period”), an alternative interest rate or (as the case may be) an
      alternative basis for the Lender to fund or continue to fund the Loan
      during the Interest Period
concerned.

              

      

       

      
        	
                4.7

              	
                Application of agreed
      alternative rate of interest.  Any alternative interest
      rate or an alternative basis which is agreed during the Negotiation Period
      shall take effect in accordance with the terms
  agreed.

              

      

       

      
        	
                4.8

              	
                Alternative rate of interest in
      absence of agreement.  If an alternative interest rate or
      alternative basis is not agreed within the Negotiation Period, and the
      relevant circumstances are continuing at the end of the Negotiation
      Period, then the Lender shall set an interest period and interest rate
      representing the cost of funding of the Lender in Dollars or in any
      available currency of the Loan plus the Margin; and the procedure provided
      for by this Clause 4.8 shall be repeated if the relevant
      circumstances are continuing at the end of the interest period so set by
      the Lender.

              

      

       

      
        	
                4.9

              	
                Notice of
      prepayment.  If the Borrower does not agree with an
      interest rate set by the Lender under Clause 4.8, the Borrower may
      give the Lender not less than 15 Business Days' notice of its intention to
      prepay at the end of the interest period set by the
  Lender.

              

      

       

      
        	
                4.10

              	
                Prepayment.  A
      notice under Clause 4.9 shall be irrevocable; and on the last
      Business Day of the interest period set by the Lender, the Borrower shall
      prepay (without premium or penalty) the Loan, together with accrued
      interest thereon at the applicable rate plus the
  Margin.

              

      

       

      
        	
                4.11

              	
                Application of
      prepayment.  The provisions of Clause 7 shall apply
      in relation to the prepayment.

              

      

       

      
        	
                5

              	
                INTEREST
      PERIODS

              

      

       

      
        	
                5.1

              	
                Commencement of Interest
      Periods.  The first Interest Period applicable to the
      Loan shall commence on the Drawdown Date and each subsequent Interest
      Period shall commence on the expiry of the preceding Interest
      Period.

              

      

       

      
        	
                5.2

              	
                Duration of normal Interest
      Periods.  Subject to Clauses 6.3 and 6.4, each Interest
      Period in respect of the Loan shall
be:

              

      

       

      
        	
                (a)

              	
                1,
      3, 6 or 9 months as notified by the Borrower to the Lender not later than
      11.00 a.m. (Piraeus time) 3 Business Days before the commencement of the
      Interest Period;

              

      

       

      
        	
                (b)

              	
                3
      months, if the Borrower fails to notify the Lender by the time specified
      in paragraph (a) above; or

              

      

       

      
        	
                (c)

              	
                such
      other period as the Lender may agree with the
  Borrower.

              

      

       

      
        	
                5.3

              	
                Duration of Interest Periods
      for repayment instalments.  In respect of an amount due
      to be repaid under Clause 7 on a particular Repayment Date, an Interest
      Period shall end on that Repayment
Date.

              

      

       

       

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

       

      
        	
                5.4

              	
                Non-availability of matching
      deposits for Interest Period selected.  If, after the
      Borrower has selected and the Lender has agreed an Interest Period longer
      than 6 months, the Lender notifies the Borrower by 11.00 a.m. (Piraeus
      time) on the second Business Day before the commencement of the Interest
      Period that it is not satisfied that deposits in Dollars for a period
      equal to the Interest Period will be available to it in the London
      Interbank Market when the Interest Period commences, the Interest Period
      shall be of 3 months.

              

      

       

      
        	
                6

              	
                DEFAULT
      INTEREST

              

      

       

      
        	
                6.1

              	
                Payment of default interest on
      overdue amounts.  The Borrower shall pay interest in
      accordance with the following provisions of this Clause 6 on any amount
      payable by the Borrower under any Finance Document which the Lender does
      not receive on or before the relevant date, that
  is:

              

      

       

      
        	
                (a)

              	
                the
      date on which the Finance Documents provide that such amount is due for
      payment; or

              

      

       

      
        	
                (b)

              	
                if
      a Finance Document provides that such amount is payable on demand, the
      date on which the demand is served;
or

              

      

       

      
        	
                (c)

              	
                if
      such amount has become immediately due and payable under Clause 18.4, the
      date on which it became immediately due and
  payable.

              

      

       

      
        	
                6.2

              	
                Default rate of
      interest.  Interest shall accrue on an overdue amount
      from (and including) the relevant date until the date of actual payment
      (as well after as before judgment) at the rate per annum determined by the
      Lender to be 2 per cent. above:

              

      

       

      
        	
                (a)

              	
                in
      the case of an overdue amount of principal, the higher of the rates set
      out at Clauses 6.3(a) and (b); or

              

      

       

      
        	
                (b)

              	
                in
      the case of any other overdue amount, the rate set out at Clause
      6.3(b).

              

      

       

      
        	
                6.3

              	
                Calculation of default rate of
      interest.  The rates referred to in Clause 6.2
      are:

              

      

       

      
        	
                (a)

              	
                the
      rate applicable to the overdue principal amount immediately prior to the
      relevant date (but only for any unexpired part of any then current
      Interest Period applicable to it);

              

      

       

      
        	
                (b)

              	
                the
      Margin plus, in respect of successive periods of any duration (including
      at call) up to 3 months which the Lender may select from time to
      time:

              

      

       

      
        	
                 
      

              	
                (i)

              	
                LIBOR;
      or

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                if
      the Lender determines that Dollar deposits for any such period are not
      being made available to it by leading banks in the London Interbank Market
      in the ordinary course of business, a rate from time to time determined by
      the Lender by reference to the cost of funds to it from such other sources
      as the Lender may from time to time
determine.

              

      

       

      
        	
                6.4

              	
                Notification of interest
      periods and default rates.  The Lender shall promptly
      notify the Borrower of each interest rate determined by it under Clause
      6.3 and of each period selected by it for the purposes of paragraph (b) of
      that Clause; but this shall not be taken to imply that the Borrower is
      liable to pay such interest only with effect from the date of the Lender's
      notification.

              

      

       

       

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

       

      
        	
                6.5

              	
                Payment of accrued default
      interest.  Subject to the other provisions of this
      Agreement, any interest due under this Clause shall be paid on the last
      day of the period by reference to which it was
  determined.

              

      

       

      
        	
                6.6

              	
                Compounding of default
      interest.  Any such interest which is not paid at the end
      of the period by reference to which it was determined shall thereupon be
      compounded.

              

      

       

      
        	
                7

              	
                REPAYMENT
      AND PREPAYMENT

              

      

       

      
        	
                7.1

              	
                Repayment
      instalments.  The Borrower shall repay the Loan by (a) 24
      consecutive three-monthly instalments of (i) in the case of the first to
      fourth instalments (inclusive), in the amount of $1,500,000 each, (ii) in
      the case of the fifth to eighth instalments (inclusive), in the amount of
      $1,250,000 each, (iii) in the case of the ninth to twelfth instalments
      (inclusive), in the amount of $875,000 each and (iv) in the case of the
      thirteenth to twenty forth instalments (inclusive), in the amount of
      $500,000 each and (b) a balloon payment in the amount of $14,500,000 (the
      “Balloon
      Instalment”)  Provided that if the
      Loan is drawdown in less than the maximum available amount thereof, each
      repayment instalment (including the Balloon Instalment) shall be reduced
      pro rata by an amount in aggregate equal to such undrawn
      amount.

              

      

       

      
        	
                7.2

              	
                Repayment
      Dates.  The first repayment instalment for the Loan shall
      be repaid on the date falling 3 months after the Drawdown Date, each
      subsequent repayment instalment shall be repaid at 3-monthly intervals
      thereafter and the last instalment shall be repaid, together with the
      Balloon Instalment, on the date falling on the sixth anniversary of the
      Drawdown Date.

              

      

       

      
        	
                7.3

              	
                Final Repayment
      Date.  On the final Repayment Date, the Borrower shall
      additionally pay to the Lender all other sums then accrued or owing under
      any Finance Document.

              

      

       

      
        	
                7.4

              	
                Voluntary
      prepayment.  Subject to the following conditions, the
      Borrower may prepay the whole or any part of the Loan on the last day of
      an Interest Period.

              

      

       

      
        	
                7.5

              	
                Conditions for voluntary
      prepayment.  The conditions referred to in Clause 7.4 are
      that:

              

      

       

      
        	
                (a)

              	
                a
      partial prepayment shall be in an amount of $500,000 or a higher integral
      multiple thereof;

              

      

       

      
        	
                (b)

              	
                the
      Lender has received from the Borrower at least 30 days’ prior written
      notice specifying the amount to be prepaid and the date on which the
      prepayment is to be made; and

              

      

       

      
        	
                (c)

              	
                the
      Borrower has provided evidence satisfactory to the Lender that any consent
      required by the Borrower or any Security Party in connection with the
      prepayment has been obtained and remains in force, and that any regulation
      relevant to this Agreement which affects the Borrower or any Security
      Party has been complied with.

              

      

       

      
        	
                7.6

              	
                Effect of notice of
      prepayment.  A prepayment notice may not be withdrawn or
      amended without the consent of the Lender and the amount specified in the
      prepayment notice shall become due and payable by the Borrower on the date
      for prepayment specified in the prepayment
  notice.

              

      

       

       

      
        
          
          

        

        
          17

          
            

          

        

        
          
          

        

      

       

      
        	
                7.7

              	
                Mandatory
      prepayment.  The Borrower shall be obliged to prepay the
      whole of the Loan:

              

      

       

      
        	
                (a)

              	
                if
      the Ship is sold, on or before the date on which the sale is completed by
      delivery of the Ship to the buyer;
or

              

      

       

      
        	
                (b)

              	
                if
      the Ship becomes a Total Loss, on the earlier of the date falling 180 days
      after the relevant Total Loss Date and the date of receipt by the Lender
      of the proceeds of insurance relating to such Total
  Loss.

              

      

       

      
        	
                7.8

              	
                Amounts payable on
      prepayment.  A prepayment shall be made together with
      accrued interest (and any other amount payable under Clause 20 or
      otherwise) in respect of the amount prepaid and, if the prepayment is not
      made on the last day of an Interest Period together with any sums payable
      under Clause 20.1(b) but without premium or
  penalty.

              

      

       

      
        	
                7.9

              	
                Application of partial
      prepayment.  Each partial prepayment shall be applied in
      inverse order of maturity against the repayment instalments (including the
      Balloon Instalment) which are outstanding at the relevant
      time.

              

      

       

      
        	
                7.10

              	
                No
      reborrowing.  No amount prepaid may be
      reborrowed.

              

      

       

      
        	
                8

              	
                CONDITIONS
      PRECEDENT

              

      

       

      
        	
                8.1

              	
                Documents, fees and no
      default.  The Lender's obligation to advance the Loan is
      subject to the following conditions
precedent:

              

      

       

      
        	
                (a)

              	
                that,
      on or before the service of the Drawdown Notice, the Lender receives the
      documents described in Part A of Schedule 2 in form and substance
      satisfactory to it and its lawyers;

              

      

       

      
        	
                (b)

              	
                that,
      on the Drawdown Date but prior to the advance of the Loan, the Lender
      receives the documents described in Part B of Schedule 2 in form and
      substance satisfactory to it and its
lawyers;

              

      

       

      
        	
                (c)

              	
                that
      before the service of the Drawdown Notice the Lender receives the
      arrangement fee referred to in Clause 19.1 and has received payment of the
      expenses referred to in Clause
19.2;

              

      

       

      
        	
                (d)

              	
                that
      both at the date of the Drawdown Notice and at the Drawdown
      Date:

              

      

       

      
        	
                 
      

              	
                (i)

              	
                no
      Event of Default or Potential Event of Default has occurred and is
      continuing or would result from the borrowing of the
  Loan;

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                the
      representations and warranties in Clause 9.1 and those of the Borrower or
      any Security Party which are set out in the other Finance Documents would
      be true and not misleading if repeated on each of those dates with
      reference to the circumstances then
existing;

              

      

       

      
        	
                 
      

              	
                (iii)

              	
                none
      of the circumstances contemplated by Clause 4.4 has occurred and is
      continuing; and

              

      

       

      
        	
                 
      

              	
                (iv)

              	
                there
      has been no material adverse change in the financial position, state of
      affairs or prospects of the Borrower, any Security Party or any member of
      the Group since the date of the Lender’s commitment letter
      (dated                                )
      to the Borrower for the Loan, in the light of which the Lender considers
      that there is a significant risk that the Borrower or any other Security
      Party will later become unable to discharge its liabilities under the
      Finance Documents to which it is a party as they fall
  due;

              

      

       

       

      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

       

      
        	
                (e)

              	
                that,
      if the ratio set out in Clause 14.1 were applied immediately following the
      advance of the Loan, the Borrower would not be obliged to provide
      additional security or prepay part of the Loan under that Clause;
      and

              

      

       

      
        	
                (f)

              	
                that
      the Lender has received, and found to be acceptable to it, any further
      opinions, consents, agreements and documents in connection with the
      Finance Documents which the Lender may request by notice to the Borrower
      prior to the Drawdown Date.

              

      

       

      
        	
                8.2

              	
                Waiver of conditions
      precedent.  If the Lender, at its discretion, permits the
      Loan to be borrowed before certain of the conditions referred to in Clause
      8.1 are satisfied, the Borrower shall ensure that those conditions are
      satisfied within 5 Business Days after the Drawdown Date (or such longer
      period as the Lender may specify).

              

      

       

      
        	
                9

              	
                REPRESENTATIONS
      AND WARRANTIES

              

      

       

      
        	
                9.1

              	
                General.  The
      Borrower represents and warrants to the Lender as
  follows.

              

      

       

      
        	
                9.2

              	
                Status.  The
      Borrower is duly incorporated and validly existing and in good standing
      under the laws of the Marshall
Islands.

              

      

       

      
        	
                9.3

              	
                Share capital and
      ownership.  The Borrower has an authorised share capital
      divided into 54,530,989 common shares and 5,934,080 warrants each of $0.01
      par value, issued in registered
form.

              

      

       

      
        	
                9.4

              	
                Corporate
      power.  The Borrower has the corporate capacity, and has
      taken all corporate action and obtained all consents necessary for
      it:

              

      

       

      
        	
                (a)

              	
                to
      execute the Finance Documents to which it is a party;
  and

              

      

       

      
        	
                (b)

              	
                to
      borrow under this Agreement and to make all the payments contemplated by,
      and to comply with, those Finance Documents to which it is a
      party.

              

      

       

      
        	
                9.5

              	
                Consents in
      force.  All the consents referred to in Clause 9.4 remain
      in force and nothing has occurred which makes any of them liable to
      revocation.

              

      

       

      
        	
                9.6

              	
                Legal validity; effective
      Security Interests.  The Finance Documents to which the
      Borrower is a party, do now or, as the case may be, will, upon execution
      and delivery (and, where applicable, registration as provided for in the
      Finance Documents):

              

      

       

      
        	
                (a)

              	
                constitute
      the Borrower's legal, valid and binding obligations enforceable against
      the Borrower in accordance with their respective terms;
  and

              

      

       

      
        	
                (b)

              	
                create
      legal, valid and binding Security Interests enforceable in accordance with
      their respective terms over all the assets to which they, by their terms,
      relate,

              

      

       

      subject
to any relevant insolvency laws affecting creditors' rights
generally.

       

      
        	
                9.7

              	
                No third party Security
      Interests.  Without limiting the generality of Clause
      9.6, at the time of the execution and delivery of each Finance
      Document:

              

      

       

      
        	
                (a)

              	
                the
      Borrower will have the right to create all the Security Interests which
      that Finance Document purports to create;
and

              

      

       

       

      
        
          
          

        

        
          19

          
            

          

        

        
          
          

        

      

       

      
        	
                (b)

              	
                no
      third party will have any Security Interest (except for Permitted Security
      Interests) or any other interest, right or claim over, in or in relation
      to any asset to which any such Security Interest, by its terms,
      relates.

              

      

       

      
        	
                9.8

              	
                No
      conflicts.  The execution by the Borrower of each Finance
      Document to which it is a party, and the borrowing by the Borrower of the
      Loan, and its compliance with each Finance Document to which it is a party
      will not involve or lead to a contravention
of:

              

      

       

      
        	
                (a)

              	
                any
      law or regulation; or

              

      

       

      
        	
                (b)

              	
                the
      constitutional documents of the Borrower;
or

              

      

       

      
        	
                (c)

              	
                any
      contractual or other obligation or restriction which is binding on the
      Borrower or any of its assets including, without limitation, its
      shareholding in the Owner.

              

      

       

      
        	
                9.9

              	
                No withholding
      taxes.  All payments which the Borrower is liable to make
      under the Finance Documents to which it is a party may be made without
      deduction or withholding for or on account of any tax payable under any
      law of any Pertinent Jurisdiction.

              

      

       

      
        	
                9.10

              	
                No
      default.  No Event of Default or Potential Event of
      Default has occurred and is
continuing.

              

      

       

      
        	
                9.11

              	
                Information.  All
      information which has been provided in writing by or on behalf of the
      Borrower or any Security Party to the Lender in connection with any
      Finance Document satisfied the requirements of Clause 10.5; all audited
      and unaudited accounts which have been so provided satisfied the
      requirements of Clause 10.7; and there has been no material adverse change
      in the financial position or state of affairs of the Borrower, the Owner
      or any other member of the Group from that disclosed in the latest of
      those accounts.

              

      

       

      
        	
                9.12

              	
                No
      litigation.  No legal or administrative action involving
      the Borrower, the Owner or any other member of the Group (including,
      without limitation, any action relating to any alleged or actual breach of
      the ISM Code and the ISPS code and/or any action relating to the MOA and
      the Initial Charterparty) has been commenced or taken or, to the
      Borrower’s knowledge, is likely to be commenced or
  taken.

              

      

       

      
        	
                9.13

              	
                Validity and completeness of
      MOA and Initial Charterparty. The MOA and the Initial Charterparty
      each constitute valid, binding and enforceable obligations of the parties
      thereto in accordance with their terms;
and:

              

      

       

      
        	
                (a)

              	
                the
      copies of each of the MOA and the Initial Charterparty delivered to the
      Lender before the date of this Agreement is a true and complete copy
      thereof; and

              

      

       

      
        	
                (b)

              	
                no
      amendments or additions to the MOA or the Initial Charterparty have been
      agreed nor has any party thereto waived any of their respective rights
      under the MOA or the Initial
Charterparty.

              

      

       

      
        	
                9.14

              	
                No rebates
      etc.  There is no agreement or understanding to allow or
      pay any rebate, premium, commission, discount or other benefit or payment
      (howsoever described) to the Owner, the Seller or a third party in
      connection with the purchase by the Owner of the Ship other than as
      disclosed to the Lender in writing on or prior to the date of this
      Agreement (including, without limitation, any information disclosed in the
      Form F-1 registration statement and prospectus filed with the US
      Securities and Exchange Commission, a copy of which has been delivered to
      the Lender).

              

      

       

       

      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

       

      
        	
                9.15

              	
                Compliance with certain
      undertakings.  At the date of this Agreement, the
      Borrower is in compliance with Clauses 10.2, 10.4, 10.9 and
      10.12.

              

      

       

      
        	
                9.16

              	
                Taxes
      paid.  The Borrower has paid all taxes applicable to, or
      imposed on or in relation to the Borrower or its
  business.

              

      

       

      
        	
                9.17

              	
                ISM Code and ISPS Code
      compliance.  The Borrower will procure that the Owner and
      the Approved Manager obtain all necessary ISM Code Documentation and ISPS
      Code Documentation in connection with the Ship and comply with the ISM
      Code and the ISPS Code.

              

      

       

      
        	
                9.18

              	
                No money
      laundering.  Without prejudice to the generality of
      Clause 2.2, in relation to the borrowing by the Borrower of the Loan, the
      performance and discharge of its obligations and liabilities under the
      Finance Documents, and the transactions and other arrangements effected or
      contemplated by the Finance Documents to which the Borrower is a party,
      the Borrower confirms that it is acting for its own account and that the
      foregoing will not involve or lead to contravention of any law, official
      requirement or other regulatory measure or procedure implemented to combat
      “money laundering” (as defined in Article 1 of the Directive (91/308/EEC)
      of the Council of the European
Communities).

              

      

       

      
        	
                10

              	
                GENERAL
      UNDERTAKINGS

              

      

       

      
        	
                10.1

              	
                General.  The Borrower
      undertakes with the Lender to comply with the following provisions of this
      Clause 10 at all times during the Security Period, except as the Lender
      may otherwise permit.

              

      

       

      
        	
                10.2

              	
                Title; negative pledge and pari
      passu ranking.  The Borrower
  will:

              

      

       

      
        	
                (a)

              	
                own
      (directly or indirectly) the entire beneficial interest in the Owner free
      from all Security Interests and other interests and rights of every kind,
      except for those created by the Finance
  Documents;

              

      

       

      
        	
                (b)

              	
                not
      create or permit to arise any Security Interest (except for Permitted
      Security Interests) over any other asset, present or future;
      and

              

      

       

      
        	
                (c)

              	
                procure
      that its liabilities under the Finance Documents to which it is a party do
      and will rank at least pari passu with all its other present and future
      unsecured liabilities, except for liabilities which are mandatorily
      preferred by law.

              

      

       

      
        	
                10.3

              	
                No disposal of
      assets.  The Borrower will not transfer, lease or
      otherwise dispose of:

              

      

       

      
        	
                (a)

              	
                all
      or a substantial part of its assets, whether by one transaction or a
      number of transactions, whether related or not;
  or

              

      

       

      
        	
                (b)

              	
                any
      debt payable to it or any other right (present, future or contingent
      right) to receive a payment, including any right to damages or
      compensation.

              

      

       

       

      
        
          
          

        

        
          21

          
            

          

        

        
          
          

        

      

       

      
        	
                10.4

              	
                Restriction on other
      liabilities or obligations to be incurred.  The Borrower
      will not incur, and will procure that the Owner will not incur, any
      liability or obligation except liabilities and
  obligations:

              

      

       

      
        	
                (a)

              	
                under
      the Finance Documents to which each is a
party;

              

      

       

      
        	
                (b)

              	
                (in
      the case of the Owner), under the MOA and the Initial Charterparty and
      incurred in the normal course of its business of owning, operating and
      chartering the Ship; and

              

      

       

      
        	
                (c)

              	
                (in
      the case of the Borrower) incurred in the normal course of its business
      (which shall include, without limitation, incurring Financial Indebtedness
      for the financing of the vessels owned by its subsidiaries guaranteeing
      the obligations of its subsidiaries and all other matters reasonably
      incidental thereto).

              

      

       

      
        	
                10.5

              	
                Information provided to be
      accurate.  All financial and other information which is
      provided in writing by or on behalf of the Borrower under or in connection
      with any Finance Document will be true and not misleading and will not
      omit any material fact or
consideration.

              

      

       

      
        	
                10.6

              	
                Provision of financial
      statements.  The Borrower will send to the
      Lender:

              

      

       

      
        	
                (a)

              	
                as
      soon as possible, but in no event later than 180 days after the end of
      each financial year of the Borrower (commencing with the financial year
      ended 31 December 2007), the audited consolidated accounts of the Group
      for that financial year;

              

      

       

      
        	
                (b)

              	
                as
      soon as possible, but in no event later than 60 days after the end of each
      quarterly period in each financial year of the Borrower (commencing with
      the financial quarter ended on 30 June 2008), the combined unaudited
      accounts of the Group for that 3- month period certified in each case as
      to their correctness by the chief financial officer of the Borrower;
      and

              

      

       

      
        	
                (c)

              	
                promptly
      after each request by the Lender, such further financial information about
      the Borrower, the Owner, the Group and/or the Ship including, but not
      limited to, charter arrangements, Financial Indebtedness, operating
      expenses and loan repayment profiles, as the Lender may
      require.

              

      

       

      
        	
                10.7

              	
                Form of financial
      statements.  All accounts (audited and unaudited)
      delivered under Clause 10.6 will:

              

      

       

      
        	
                (a)

              	
                be
      prepared in accordance with all applicable laws and
  GAAP;

              

      

       

      
        	
                (b)

              	
                give
      a true and fair view of the state of affairs of the Group at the date of
      those accounts and of its profit for the period to which those accounts
      relate; and

              

      

       

      
        	
                (c)

              	
                fully
      disclose or provide for all significant liabilities of the Group;
      and

              

      

       

      
        	
                (d)

              	
                be
      accompanied by a certificate signed by a certificate signed by the chief
      financial officer of the Borrower confirming that, as at the date of the
      certificate, no Event of Default has occurred and is
      continuing.

              

      

       

      
        	
                10.8

              	
                Shareholder and creditor
      notices.  The Borrower will send the Lender, at the same
      time as they are despatched, copies of all communications which are
      despatched to all of the Borrower's shareholders or creditors or any class
      of them.

              

      

       

      
        	
                10.9

              	
                Consents.  The
      Borrower will maintain in force and promptly obtain or renew, and will
      promptly send certified copies to the Lender of, all consents
      required:

              

      

       

      
        	
                (a)

              	
                for
      the Borrower and the Owner to perform their respective obligations under
      any Finance Document to which each is a
party;

              

      

       

       

      
        
          
          

        

        
          22

          
            

          

        

        
          
          

        

      

       

      
        	
                (b)

              	
                for
      the validity or enforceability of any Finance
  Document;

              

      

       

      
        	
                (c)

              	
                for
      the Owner to continue to own and operate the
  Ship,

              

      

       

      and
the Borrower will comply (or procure compliance) with the terms of all such
consents.

       

      
        	
                10.10

              	
                Maintenance of Security
      Interests.  The Borrower
will:

              

      

       

      
        	
                (a)

              	
                at
      its own cost, do all that it reasonably can to ensure that any Finance
      Document validly creates the obligations and the Security Interests which
      it purports to create; and

              

      

       

      
        	
                (b)

              	
                without
      limiting the generality of paragraph (a), at its own cost, promptly
      register, file, record or enrol any Finance Document with any court or
      authority in all Pertinent Jurisdictions, pay any stamp, registration or
      similar tax in all Pertinent Jurisdictions in respect of any Finance
      Document, give any notice or take any other step which is or has become
      necessary or desirable for any Finance Document to be valid, enforceable
      or admissible in evidence or to ensure or protect the priority of any
      Security Interest which it creates.

              

      

       

      
        	
                10.11

              	
                Notification of
      litigation.  The Borrower will provide the Lender with
      details of any legal or administrative action involving the Borrower, the
      Owner, any other Security Party, the Approved Manager, the Ship or the
      Earnings or the Insurances of the Ship as soon as such action is
      instituted or it becomes apparent to the Borrower that it is likely to be
      instituted, unless it is clear that the legal or administrative action
      cannot be considered material in the context of the Finance
      Documents.

              

      

       

      
        	
                10.12

              	
                Principal place of
      business.  The Borrower will maintain its place of
      business, and keep its corporate documents and records, at the address
      stated at Clause 28.2(a); and the Borrower will not establish, or do
      anything as a result of which it would be deemed to have a place of
      business in the United Kingdom or the United States of
      America.

              

      

       

      
        	
                10.13

              	
                Confirmation of no
      default.  The Borrower will, within 2 Business Days after
      service by the Lender of a written request, serve on the Lender a notice
      which is signed by an officer or director of the Borrower and which (based
      on its most recent annual or interim financial
  statements):

              

      

       

      
        	
                (a)

              	
                states
      that no Event of Default or Potential Event of Default has occurred;
      or

              

      

       

      
        	
                (b)

              	
                states
      that no Event of Default or Potential Event of Default has occurred,
      except for a specified event or matter, of which all material details are
      given.

              

      

       

      
        	
                10.14

              	
                Notification of
      default.  The Borrower will notify the Lender as soon as
      the Borrower becomes aware of:

              

      

       

      
        	
                (a)

              	
                the
      occurrence of an Event of Default or a Potential Event of Default;
      or

              

      

       

      
        	
                (b)

              	
                any
      matter which indicates that an Event of Default or a Potential Event of
      Default may have occurred,

              

      

       

      and
will thereafter keep the Lender fully up-to-date with all
developments.

       

       

      
        
          
          

        

        
          23

          
            

          

        

        
          
          

        

      

       

      
        	
                10.15

              	
                Provision of further
      information.  The Borrower will, as soon as practicable
      after receiving the request, provide the Lender with any additional
      financial or other information
relating:

              

      

       

      
        	
                (a)

              	
                to
      the Borrower, the Owner, any other member of the Group, the Ship, the
      Approved Manager or any other Security Party, the Insurances or the
      Earnings; or

              

      

       

      
        	
                (b)

              	
                to
      any other matter relevant to, or to any provision of, a Finance
      Document,

              

      

       

      which
may be requested by the Lender at any time.

       

      
        	
                10.16

              	
                No amendment to MOA or Initial
      Charterparty.  The Borrower will procure that the Owner
      will not agree to any amendment or supplement to (in the case of the
      Owner) the MOA or the Initial
Charterparty.

              

      

       

      
        	
                10.17

              	
                Ownership.  The
      Borrower shall ensure that (a) it shall remain the direct or indirect
      owner of all of the limited liability company interests in the Owner and
      (b) there shall be no change in the legal and beneficial ownership of the
      shares in the Owner.

              

      

       

      
        	
                10.18

              	
                General and administrative
      costs.  The Borrower shall ensure that the payment of all
      the general and administrative costs of the Borrower and the Owner in
      connection with the ownership and operation of the Ship (including,
      without limitation, the payment of the management fee pursuant to the
      Management Agreement) shall be fully subordinated to the payment
      obligations of the Borrower and the Owner under this Agreement and the
      other Finance Documents throughout the Security
  Period.

              

      

       

      
        	
                10.19

              	
                Money
      laundering.  Promptly upon the Lender’s request the
      Borrower will supply, or procure the supply of, such documentation and
      other evidence as is reasonably requested by the Lender in order to carry
      out and be satisfied with the results of all necessary “know your client”
      or other checks which it is required to carry out in relation to the
      transactions contemplated by the Finance Documents and to the identity of
      any parties to the Finance Documents and their directors and
      officers.

              

      

       

      
        	
                11

              	
                CORPORATE
      UNDERTAKINGS

              

      

       

      
        	
                11.1

              	
                General.  The
      Borrower also undertakes with the Lender to comply with the following
      provisions of this Clause 11 at all times during the Security Period
      except as the Lender may otherwise
permit.

              

      

       

      
        	
                11.2

              	
                Maintenance of
      status.  The Borrower will maintain its separate
      corporate existence and remain in good standing under the laws of the
      Republic of the Marshall Islands.

              

      

       

      
        	
                11.3

              	
                Negative
      undertakings.  The Borrower will
  not:

              

      

       

      
        	
                (a)

              	
                change
      the nature of its business; or

              

      

       

      
        	
                (b)

              	
                provide
      any form of credit or financial assistance
to:

              

      

       

      
        	
                 
      

              	
                (i)

              	
                a
      person who is directly or indirectly interested in the Borrower's share or
      loan capital; or

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                any
      company in or with which such a person is directly or indirectly
      interested or connected;

              

      

       

      
        	
                 
      

              	
                or
      enter into any transaction with or involving such a person or company on
      terms which are, in any respect, less favourable to the Borrower than
      those which it could obtain in a bargain made at arms'
      length  Provided that this shall
      not prevent or restrict the Borrower from on-lending the Loan to the
      Owner;

              

      

       

       

      
        
          
          

        

        
          24

          
            

          

        

        
          
          

        

      

      
 

      
        	
                (c)

              	
                allow
      the Owner to open or maintain any account with any bank or financial
      institution except accounts with the Lender for the purpose of the Finance
      Documents;

              

      

       

      
        	
                (d)

              	
                issue,
      allot or grant any person a right to any shares in its capital or
      repurchase (other than through the share repurchase schemes disclosed by
      the Borrower to the Lender on or prior to the date of this Agreement) or
      reduce its issued share capital; or

              

      

       

      
        	
                (e)

              	
                enter
      into any form of amalgamation, merger or de-merger or any form of
      reconstruction or reorganisation.

              

      

       

      
        	
                11.4

              	
                Subordination of rights of
      Borrower.  All rights which the Borrower at any time has
      (whether in respect of the Loan or any other transaction) against any
      Owner or its assets shall be fully subordinated to the rights of the
      Lender under the Finance Documents; and in particular, the Borrower shall
      not during the Security Period:

              

      

       

      
        	
                (a)

              	
                claim,
      or in a bankruptcy of the Owner or prove for any amount payable to the
      Borrower by the Owner, whether in respect of the Loan or any other
      transaction;

              

      

       

      
        	
                (b)

              	
                take
      or enforce any Security Interest for any such amount;
  or

              

      

       

      
        	
                (c)

              	
                claim
      to set-off any such amount against any amount payable by the Borrower to
      the Owner.

              

      

       

      
        	
                11.5

              	
                Financial
      Covenants.  The Borrower undertakes that at all
      times:

              

      

       

      
        	
                (a)

              	
                the
      Interest Coverage Ratio shall not be less than
  2:1;

              

      

       

      
        	
                (b)

              	
                the
      Leverage Ratio shall not be greater than 0.6:1;
  and

              

      

       

      
        	
                (c)

              	
                the
      Borrower will maintain Liquid Funds in an aggregate amount of at least
      $500,000 per Fleet Vessel.

              

      

       

      
        	
                11.6

              	
                Compliance
      Check.  Compliance with the undertakings contained in
      Clause 11.5 shall be determined as at each Compliance Date by reference
      to, in the case of the compliance check as at each of 31 March, 30 June
      and 30 September in each financial year, the unaudited consolidated
      accounts of the Group for the financial quarters ending on such date in
      each financial year delivered by the Lender pursuant to this Agreement and
      for the compliance check as at 31 December in each financial year, the
      audited consolidated accounts for that financial year of the
      Group  delivered to the Lender pursuant to this Agreement. At
      the same time as it delivers those consolidated accounts, the Borrower
      shall deliver to the Lender a Compliance Certificate signed by the chief
      financial officer of the Borrower.

              

      

       

      
        	
                11.7

              	
                Dividends.  The
      Borrower may pay dividends or make any other form of distribution subject
      to the satisfaction of the following
conditions:

              

      

       

      
        	
                (a)

              	
                the
      Lender has received a certificate issued by the chief financial officer of
      the Borrower on the date on which the payment of the dividend is declared
      which confirms that no Event of Default has occurred which is continuing
      and that no Event of Default or Potential Event of Default will result
      from the payment of the dividend or the making of the distribution;
      and

              

      

       

      
        	
                (b)

              	
                the
      Lender is satisfied that on the date on which the certificate referred to
      in paragraph (a) is issued, the Security Cover Percentage is equal to at
      least 125 per cent.

              

      

       

       

      
        
          
          

        

        
          25

          
            

          

        

        
          
          

        

      

       

      
        	
                12

              	
                INSURANCE

              

      

       

      
        	
                12.1

              	
                General.  The
      Borrower also undertakes with the Lender to procure that the Owner will
      comply with the following provisions of this Clause 12 at all times during
      the Security Period (after the Ship has been delivered to the Owner in
      accordance with the MOA) except as the Lender may otherwise
      permit.

              

      

       

      
        	
                12.2

              	
                Maintenance of obligatory
      insurances.  The Borrower shall procure that the Owner
      shall keep the Ship insured at the expense of the Owner
      against:

              

      

       

      
        	
                (a)

              	
                fire
      and usual marine risks (including hull and machinery and excess
      risks);

              

      

       

      
        	
                (b)

              	
                war
      risks (including protection and indemnity war
  risks);

              

      

       

      
        	
                (c)

              	
                in
      the case of protection and indemnity war risks, in an amount equal to the
      amount for which the war risks under the hull policies are effected
      (including, without limitation, protection and indemnity war risks in
      excess of the amount of war risks
(hull));

              

      

       

      
        	
                (d)

              	
                protection
      and indemnity risks in excess of the limit of cover for oil pollution
      liability risks included within the protection and indemnity risks;
      and

              

      

       

      
        	
                (e)

              	
                any
      other risks against which the Lender considers, having regard to practices
      and other circumstances prevailing at the relevant time, it would in the
      opinion of the Lender be reasonable for the Owner to insure and which are
      specified by the Lender by notice to the
Owner.

              

      

       

      
        	
                12.3

              	
                Terms of obligatory
      insurances.  The Borrower shall procure that the Owner
      shall effect such insurances:

              

      

       

      
        	
                (a)

              	
                in
      Dollars;

              

      

       

      
        	
                (b)

              	
                in
      the case of fire and usual marine risks and war risks, in an amount on an
      agreed value basis at least the greater of (i) an amount equal to 125 per
      cent. of the Loan and (ii) the Market Value of the Ship;
    and

              

      

       

      
        	
                (c)

              	
                in
      the case of oil pollution liability risks, for an aggregate amount equal
      to the highest level of cover from time to time available under basic
      protection and indemnity club entry (with the international group of
      protection and indemnity clubs) and the international marine insurance
      market (currently $1,000,000,000);

              

      

       

      
        	
                (d)

              	
                in
      relation to protection and indemnity risks, in respect of the full value
      and tonnage of the Ship;

              

      

       

      
        	
                (e)

              	
                on
      approved terms; and

              

      

       

      
        	
                (f)

              	
                through
      approved brokers and with approved insurance companies and/or underwriters
      or, in the case of war risks and protection and indemnity risks, in
      approved war risks and protection and indemnity risks
      associations.

              

      

       

      
        	
                12.4

              	
                Further protections for the
      Lender.  In addition to the terms set out in Clause 12.3,
      the Borrower shall procure that the obligatory insurances
      shall:

              

      

       

      
        	
                (a)

              	
                name
      the Lender as sole loss payee with such directions for payment as the
      Lender may specify;

              

      

       

       

      
        
          
          

        

        
          26

          
            

          

        

        
          
          

        

      

       

      
        	
                (b)

              	
                provide
      that all payments by or on behalf of the insurers under the obligatory
      insurances to the Lender shall be made without set-off, counterclaim or
      deductions or condition whatsoever;

              

      

       

      
        	
                (c)

              	
                provide
      that the insurers shall waive, to the fullest extent permitted by English
      law, their entitlement (if any) (whether by statute, common law, equity,
      or otherwise) to be subrogated to the rights and remedies of the Lender in
      respect of any rights or interests (secured or not) held by or available
      to the Lender in respect of the Secured Liabilities, until the Secured
      Liabilities shall have been fully repaid and discharged, except that the
      insurers shall not be restricted by the terms of this paragraph (d) from
      making personal claims against persons (other than the Owner or the
      Lender) in circumstances where the insurers have fully discharged their
      liabilities and obligations under the relevant obligatory
      insurances;

              

      

       

      
        	
                (d)

              	
                provide
      that such obligatory insurances shall be primary without right of
      contribution from other insurances which may be carried by the
      Lender;

              

      

       

      
        	
                (e)

              	
                provide
      that the Lender may make proof of loss if the Owner fails to do so;
      and

              

      

       

      
        	
                (f)

              	
                provide
      that if any obligatory insurance is cancelled, or if any substantial
      change is made in the coverage which adversely affects the interest of the
      Lender, or if any obligatory insurance is allowed to lapse for non-payment
      of premium, such cancellation, charge or lapse shall not be effective with
      respect to the Lender for 30 days (or 7 days in the case of war risks)
      after receipt by the Lender of prior written notice from the insurers of
      such cancellation, change or lapse.

              

      

       

      
        	
                12.5

              	
                Renewal of obligatory
      insurances.  The Borrower shall procure that the Owner
      shall:

              

      

       

      
        	
                (a)

              	
                at
      least 21 days before the expiry of any obligatory
    insurance:

              

      

       

      
        	
                 
      

              	
                (i)

              	
                notify
      the Lender of the brokers (or other insurers) and any protection and
      indemnity or war risks association through or with whom the Owner proposes
      to renew that insurance and of the proposed terms of renewal;
      and

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                in
      case of any substantial change in insurance cover, obtain the Lender’s
      approval to the matters referred to in paragraph (i)
  above;

              

      

       

      
        	
                (b)

              	
                at
      least 14 days before the expiry of any obligatory insurance, renew the
      insurance in accordance with the Lender’s approval pursuant to paragraph
      (a); and

              

      

       

      
        	
                (c)

              	
                procure
      that the approved brokers and/or the war risks and protection and
      indemnity associations with which such a renewal is effected shall
      promptly after the renewal notify the Lender in writing of the terms and
      conditions of the renewal.

              

      

       

      
        	
                12.6

              	
                Copies of policies; letters of
      undertaking.  The Borrower shall procure that the Owner
      shall ensure that all approved brokers provide the Lender with copies of
      all policies relating to the obligatory insurances which they effect or
      renew and of a letter or letters of undertaking in a form required by the
      Lender and including undertakings by the approved brokers
      that:

              

      

       

      
        	
                (a)

              	
                they
      will have endorsed on each policy, immediately upon issue, a loss payable
      clause and a notice of assignment complying with the provisions of Clause
      12.4;

              

      

       

       

      
        
          
          

        

        
          27

          
            

          

        

        
          
          

        

      

       

      
        	
                (b)

              	
                they
      will hold such policies, and the benefit of such insurances, to the order
      of the Lender in accordance with the said loss payable
    clause;

              

      

       

      
        	
                (c)

              	
                they
      will advise the Lender immediately of any material change to the terms of
      the obligatory insurances;

              

      

       

      
        	
                (d)

              	
                they
      will notify the Lender, not less than 14 days before the expiry of the
      obligatory insurances, in the event of their not having received notice of
      renewal instructions from the Owner or its agents and, in the event of
      their receiving instructions to renew, they will promptly notify the
      Lender of the terms of the
instructions;

              

      

       

      
        	
                (e)

              	
                they
      will notify the Lender if any person other than the Owner is named as
      assured or co-assured in any of the obligatory insurances and shall
      procure that, upon the written request of the Lender, such additional
      assured or co-assured executes in favour of the Lender an assignment (in
      such form as the Lenders may approve or require) of its interest in the
      obligatory insurances; and

              

      

       

      
        	
                (f)

              	
                they
      will not set off against any sum recoverable in respect of a claim
      relating to the Ship owned by the Owner under such obligatory insurances
      any premiums or other amounts due to them or any other person whether in
      respect of the Ship or otherwise, they waive any lien on the policies or,
      any sums received under them, which they might have in respect of such
      premiums or other amounts, and they will not cancel such obligatory
      insurances by reason of non-payment of such premiums or other amounts, and
      will arrange for a separate policy to be issued in respect of the Ship
      forthwith upon being so requested by the
Lender.

              

      

       

      
        	
                12.7

              	
                Copies of certificates of
      entry.  The Borrower shall procure that the Owner shall
      ensure that any protection and indemnity and/or war risks associations in
      which the Ship is entered provides the Lender
  with:

              

      

       

      
        	
                (a)

              	
                a
      certified copy of the certificate of entry for the
  Ship;

              

      

       

      
        	
                (b)

              	
                a
      letter or letters of undertaking in such form as may be required by the
      Lender; and

              

      

       

      
        	
                (c)

              	
                where
      required to be issued under the terms of insurance/indemnity provided by
      the Owner’s protection and indemnity association, a certified copy of each
      United States of America voyage quarterly declaration (or other similar
      document or documents) made by the Owner in accordance with the
      requirements of such protection and indemnity association;
    and

              

      

       

      
        	
                (d)

              	
                a
      certified copy of each certificate of financial responsibility for
      pollution by oil or other Environmentally Sensitive Material issued by the
      relevant certifying authority in relation to the Ship if
      applicable.

              

      

       

      
        	
                12.8

              	
                Deposit of original
      policies.  The Borrower shall procure that the Owner
      shall ensure that all policies relating to obligatory insurances are
      deposited with the approved brokers through which the insurances are
      effected or renewed.

              

      

       

      
        	
                12.9

              	
                Payment of
      premiums.  The Borrower shall procure that the Owner
      shall punctually pay all premiums or other sums payable in respect of the
      obligatory insurances and produce all relevant receipts when so required
      by the Lender.

              

      

       

       

      
        
          
          

        

        
          28

          
            

          

        

        
          
          

        

      

       

      
        	
                12.10

              	
                Guarantees.  The
      Borrower shall procure that the Owner shall ensure that any guarantees
      required by a protection and indemnity or war risks association are
      promptly issued and remain in full force and
  effect.

              

      

       

      
        	
                12.11

              	
                Restrictions on
      employment.  The Borrower shall procure that the Owner
      will not employ the Ship, nor permit her to be employed, outside the cover
      provided by any obligatory
insurances.

              

      

       

      
        	
                12.12

              	
                Compliance with terms of
      insurances.  The Borrower shall procure that the Owner
      shall not do or omit to do (or permit to be done or not to be done) any
      act or thing which would or might render any obligatory insurance invalid,
      void, voidable or unenforceable or render any sum payable thereunder
      repayable in whole or in part; and, in
  particular:

              

      

       

      
        	
                (a)

              	
                the
      Owner shall take all necessary action and comply with all requirements
      which may from time to time be applicable to the obligatory insurances,
      and (without limiting the obligation contained in Clause 12.7(c) above)
      ensure that the obligatory insurances are not made subject to any
      exclusions or qualifications to which the Lender has not given its prior
      approval;

              

      

       

      
        	
                (b)

              	
                the
      Owner shall not make any changes relating to the classification or
      classification society or manager or operator of the Ship unless approved
      by the underwriters of the obligatory
  insurances;

              

      

       

      
        	
                (c)

              	
                the
      Owner shall not make all quarterly or other voyage declarations which may
      be required by the protection and indemnity risks association in which the
      Ship is entered to maintain cover for trading to the United States of
      America and Exclusive Economic Zone (as defined in the United States Oil
      Pollution Act 1990 or any other applicable legislation);
    and

              

      

       

      
        	
                (d)

              	
                the
      Owner shall not employ the Ship owned by it, nor allow it to be employed,
      otherwise than in conformity with the terms and conditions of the
      obligatory insurances, without first obtaining the consent of the insurers
      and complying with any requirements (as to extra premium or otherwise)
      which the insurers specify.

              

      

       

      
        	
                12.13

              	
                Alteration to terms of
      insurances.  The Borrower shall procure that the Owner
      shall neither make nor agree to any alteration to the terms of any
      obligatory insurance or waive any right relating to any obligatory
      insurance without the prior written consent of the
  Lender.

              

      

       

      
        	
                12.14

              	
                Settlement of
      claims.  The Borrower shall procure that the Owner shall
      not settle, compromise or abandon any claim under any obligatory insurance
      for Total Loss or for a Major Casualty, and shall do all things necessary
      and provide all documents, evidence and information to enable the Lender
      to collect or recover any moneys which at any time become payable in
      respect of the obligatory
insurances.

              

      

       

      
        	
                12.15

              	
                Provision of copies of
      communications.  The Borrower shall procure that the
      Owner shall provide the Lender, at the time of each such communication,
      copies of all written communications between the Owner
  and:

              

      

       

      
        	
                (a)

              	
                the
      approved brokers; and

              

      

       

      
        	
                (b)

              	
                the
      approved protection and indemnity and/or war risks associations;
      and

              

      

       

       

      
        
          
          

        

        
          29

          
            

          

        

        
          
          

        

      

       

      
        	
                (c)

              	
                the
      approved insurance companies and/or underwriters, which relate directly or
      indirectly to:

              

      

       

      
        	
                 
      

              	
                (i)

              	
                the
      Owner’s obligations relating to the obligatory insurances including,
      without limitation, all requisite declarations and payments of additional
      premiums or calls; and

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                any
      credit arrangements made between the Owner and any of the persons referred
      to in paragraphs (a) or (b) above relating wholly or partly to the
      effecting or maintenance of the obligatory
  insurances.

              

      

       

      
        	
                12.16

              	
                Provision of
      information.  In addition, the Borrower shall procure
      that the Owner shall promptly provide the Lender (or any persons which it
      may designate) with any information which the Lender (or any such
      designated person) reasonably requests for the purpose
  of:

              

      

       

      
        	
                (a)

              	
                obtaining
      or preparing any report from an independent marine insurance broker as to
      the adequacy of the obligatory insurances effected or proposed to be
      effected; and/or

              

      

       

      
        	
                (b)

              	
                effecting,
      maintaining or renewing any such insurances as are referred to in Clause
      12.17 below or dealing with or considering any matters relating to any
      such insurances

              

      

       

      
        	
                 
      

              	
                and
      the Borrower shall, within a reasonable time following the Lender’s
      demand, indemnify the Lender in respect of all fees and other expenses
      incurred by or for the account of the Lender in connection with any such
      report as is referred to in paragraph (a)
above.

              

      

      

      
        	
                12.17

              	
                Mortgagee's interest
      insurances.  The Lender shall be entitled from time to
      time to effect, maintain and renew a mortgage’s interest insurance in an
      amount equal to 110 per cent. of the Loan, on such terms, through such
      insurers and generally in such manner as the Lender may from time to time
      consider appropriate and the Borrower shall upon demand fully indemnify
      the Lender in respect of all premiums and other expenses which are
      incurred in connection with or with a view to effecting, maintaining or
      renewing such insurance or dealing with, or considering, any matter
      arising out of such insurance.

              

      

       

      
        	
                12.18

              	
                Review of insurance
      requirements.  The Lender shall be entitled to review the
      requirements of this Clause 12 from time to time in order to take account
      of any changes in circumstances after the date of this Agreement which
      are, in the opinion of the Lender, significant and capable of affecting
      the Owner or the Ship and their insurance (including, without limitation,
      changes in the availability or the cost of insurance coverage or the risks
      to which the Owner may be subject), and may appoint insurance consultants
      in relation to this review at the cost of the
  Borrower.

              

      

       

      
        	
                12.19

              	
                Modification of insurance
      requirements.  The Lender shall notify the Borrower of
      any proposed modification under Clause 12.18 to the requirements of this
      Clause 12 which the Lender, acting up the advice of their insurance
      consultants considers appropriate in the circumstances, and such
      modification shall take effect on and from the date it is notified in
      writing to the Borrower as an amendment to this Clause 12 and shall bind
      the Borrower accordingly.

              

      

       

      
        	
                12.20

              	
                Compliance with mortgagee's
      instructions.  The Lender shall be entitled (without
      prejudice to or limitation of any other rights which it may have or
      acquire under any Finance Document) to require the Ship to remain at any
      safe port or to proceed to and remain at any safe port designated by the
      Lender until the Owner implements any amendments to the terms of the
      obligatory insurances and any operational changes required as a result of
      a notice served under Clause 12.19.

              

      

       

       

      
        
          
          

        

        
          30

          
            

          

        

        
          
          

        

      

       

      
        	
                13

              	
                SHIP
      COVENANTS

              

      

       

      
        	
                13.1

              	
                General.  The
      Borrower also undertakes with the Lender to procure that the Owner shall
      comply with the following provisions of this Clause 13 at all times during
      the Security Period (after the Ship has been delivered to the Owner in
      accordance with the MOA) except as the Lender may otherwise
      permit.

              

      

       

      
        	
                13.2

              	
                Ship's name and
      registration.  The Borrower shall procure that the Owner
      shall keep the Ship owned by it registered in its ownership under the
      Marshall Islands flag; shall not do or allow to be done anything as a
      result of which such registration might be cancelled or imperilled; and
      shall not change the name or port of registry of the
  Ship.

              

      

       

      
        	
                13.3

              	
                Repair and
      classification.  The Borrower shall procure that the
      Owner shall keep the Ship in a good and safe condition and state of
      repair:

              

      

       

      
        	
                (a)

              	
                consistent
      with first-class ship ownership and management
  practice;

              

      

       

      
        	
                (b)

              	
                so
      as to maintain the highest class with Det Norske Veritas (or such other
      first-class classification society which is a member of IACS acceptable to
      the Lender) free of overdue recommendations and conditions of such
      classification society; and

              

      

       

      
        	
                (c)

              	
                so
      as to comply with all laws and regulations applicable to vessels
      registered at ports in the Marshall Islands or to vessels trading to any
      jurisdiction to which the Ship may trade from time to time, including but
      not limited to the ISM Code, the ISPS Code, the ISM Code Documentation and
      the ISPS Code Documentation.

              

      

       

      
        	
                13.4

              	
                Modification.  The
      Borrower shall procure that the Owner shall not make any modification or
      repairs to, or replacement of, the Ship or equipment installed on her
      which would or might materially alter the structure, type or performance
      characteristics of the Ship or materially reduce her
  value.

              

      

       

      
        	
                13.5

              	
                Removal of
      parts.  The Borrower shall procure that the Owner shall
      not remove any material part of the Ship, or any item of equipment
      installed on, the Ship unless the part or item so removed is forthwith
      replaced by a suitable part or item which is in the same condition as or
      better condition than the part or item removed, is free from any Security
      Interest or any right in favour of any person other than the Lender and
      becomes on installation on the Ship the property of the Owner and subject
      to the security constituted by the Mortgage and if applicable, the Deed of
      Covenant relative to the Ship Provided that the Owner
      may install equipment owned by a third party if the equipment can be
      removed without any risk of damage to the
Ship.

              

      

       

      
        	
                13.6

              	
                Surveys.  The
      Borrower shall procure that the Owner shall submit the Ship regularly to
      all periodical or other surveys which may be required for classification
      purposes and, if so required by the Lender, provide the Lender (at the
      expense of the Borrower) with copies of all survey
  reports.

              

      

       

      
        	
                13.7

              	
                Inspection.  The
      Borrower shall procure that the Owner shall permit the Lender (by
      surveyors or other persons appointed by it for that purpose) to board the
      Ship owned by it at all reasonable times to inspect her condition or to
      satisfy themselves about proposed or executed repairs and shall afford all
      proper facilities for such inspections.  All fees and expenses
      incurred in relation to the appointment of surveyors shall be for the
      account of the Borrower.

              

      

       

       

      
        
          
          

        

        
          31

          
            

          

        

        
          
          

        

      

       

      
        	
                13.8

              	
                Prevention of and release from
      arrest.  The Borrower shall procure that the Owner shall
      promptly discharge:

              

      

       

      
        	
                (a)

              	
                all
      liabilities which give or may give rise to maritime or possessory liens on
      or claims enforceable against the Ship owned by it, her Earnings or her
      Insurances;

              

      

       

      
        	
                (b)

              	
                all
      taxes, dues and other amounts charged in respect of the Ship, her Earnings
      or her Insurances; and

              

      

       

      
        	
                (c)

              	
                all
      other outgoings whatsoever in respect of the Ship, her Earnings or her
      Insurances

              

      

       

      
        	
                 
      

              	
                and,
      forthwith upon receiving notice of the arrest of the Ship, or of her
      detention in exercise or purported exercise of any lien or claim, the
      Owner shall  procure her release by providing bail or otherwise
      as the circumstances may require.

              

      

      

      
        	
                13.9

              	
                Compliance with laws
      etc.  The Borrower shall procure that the Owner and the
      Approved Manager shall:

              

      

       

      
        	
                (a)

              	
                comply,
      or procure compliance with the ISM Code, the ISPS Code, all Environmental
      Laws and all other laws or regulations relating to the Ship owned by the
      Owner, its ownership, operation and management or to the business of the
      Owner;

              

      

       

      
        	
                (b)

              	
                not
      employ the Ship nor allow her employment in any manner contrary to any law
      or regulation in any relevant jurisdiction including but not limited to
      the ISM Code and the ISPS Code; and

              

      

       

      
        	
                (c)

              	
                in
      the event of hostilities in any part of the world (whether war is declared
      or not), not cause or permit the Ship to enter or trade to any zone which
      is declared a war zone by any government or by the Ship's war risks
      insurers unless the Owner has (at its expense) effected any special,
      additional or modified insurance cover required for it to enter or trade
      to any war zone.

              

      

       

      
        	
                13.10

              	
                Provision of
      information.  The Borrower shall procure that the Owner
      shall promptly provide the Lender with any information which the Lender
      requests regarding:

              

      

       

      
        	
                (a)

              	
                the
      Ship, her employment, position and
engagements;

              

      

       

      
        	
                (b)

              	
                the
      Earnings and payments and amounts due to the master and crew of the
      Ship;

              

      

       

      
        	
                (c)

              	
                any
      expenses incurred, or likely to be incurred, in connection with the
      operation, maintenance or repair of the Ship and any payments made in
      respect of the Ship;

              

      

       

      
        	
                (d)

              	
                any
      towages and salvages;

              

      

       

      
        	
                (e)

              	
                its
      compliance or the compliance of the Ship with the ISM Code and the ISPS
      Code,

              

      

       

      
        	
                 
      

              	
                and,
      upon the Lender's request, provide copies of any current charter relating
      to the Ship and of any current charter guarantee, and copies of the ISM
      Code Documentation and the ISPS Code
  Documentation.

              

      

       

       

      
        
          
          

        

        
          32

          
            

          

        

        
          
          

        

      

      
 

      
        	
                13.11

              	
                Notification of certain
      events.  The Borrower shall procure that the Owner shall
      immediately notify the Lender by letter
of:

              

      

       

      
        	
                (a)

              	
                any
      casualty which is or is likely to be or to become a Major
      Casualty;

              

      

       

      
        	
                (b)

              	
                any
      occurrence as a result of which the Ship has become or is, by the passing
      of time or otherwise, likely to become a Total
  Loss;

              

      

       

      
        	
                (c)

              	
                any
      requirement or recommendation made by any insurer or classification
      society or by any competent authority which is not immediately complied
      with;

              

      

       

      
        	
                (d)

              	
                any
      arrest or detention of the Ship, any exercise or purported exercise of any
      lien on the Ship or her Earnings or any requisition of the Ship for
      hire;

              

      

       

      
        	
                (e)

              	
                any
      intended dry docking of the Ship;

              

      

       

      
        	
                (f)

              	
                any
      Environmental Claim made against the Owner or in connection with the Ship,
      or any Environmental Incident;

              

      

       

      
        	
                (g)

              	
                any
      claim for breach of the ISM Code or the ISPS Code being made against the
      Owner, the Approved Manager or otherwise in connection with the Ship;
      or

              

      

       

      
        	
                (h)

              	
                any
      other matter, event or incident, actual or threatened, the effect of which
      will or could lead to the ISM Code or the ISPS Code not being complied
      with

              

      

       

      
        	
                 
      

              	
                and
      the Borrower shall keep the Lender advised in writing on a regular basis
      and in such detail as the Lender shall require of the Owner’s, the
      Approved Manager’s  or any other person's response to any of
      those events or matters.

              

      

      

      
        	
                13.12

              	
                Restrictions on chartering,
      appointment of managers etc.  The Borrower shall procure
      that the Owner shall not:

              

      

       

      
        	
                (a)

              	
                let
      the Ship owned by it on demise charter for any
  period;

              

      

       

      
        	
                (b)

              	
                other
      than the Initial Charterparty or Future Charterparty, enter into any time
      or consecutive voyage charter in respect of the Ship for a term which
      exceeds, or which by virtue of any optional extensions may exceed, 11
      months;

              

      

       

      
        	
                (c)

              	
                change
      the terms on which the Ship is employed or the identity of the person by
      whom the Ship is employed;

              

      

       

      
        	
                (d)

              	
                enter
      into any charter in relation to the Ship under which more than 2 months'
      hire (or the equivalent) is payable in
advance;

              

      

       

      
        	
                (e)

              	
                charter
      the Ship otherwise than on bona fide arm's length terms at the time when
      the Ship is fixed;

              

      

       

      
        	
                (f)

              	
                appoint
      a manager of the Ship other than the Approved Manager or agree to any
      alteration to the terms of the Approved Manager’s
    appointment;

              

      

       

      
        	
                (g)

              	
                de-activate
      or lay up the Ship; or

              

      

       

      
        	
                (h)

              	
                put
      the Ship into the possession of any person for the purpose of work being
      done upon her in an amount exceeding or likely to exceed $250,000 (or the
      equivalent in any other currency) unless that person has first given to
      the Lender and in terms satisfactory to it a written undertaking not to
      exercise any lien on the Ship or her Earnings for the cost of such work or
      otherwise.

              

      

       

       

      
        
          
          

        

        
          33

          
            

          

        

        
          
          

        

      

       

      
        	
                13.13

              	
                Notice of
      Mortgage.  The Borrower shall procure that the Owner
      shall keep the Mortgage applicable to the Ship registered against the Ship
      as a valid first preferred mortgage, carry on board the Ship a certified
      copy of the Mortgage and place and maintain in a conspicuous place in the
      navigation room and the Master's cabin of the Ship a framed printed notice
      stating that the Ship is mortgaged by the Owner to the
    Lender.

              

      

       

      
        	
                13.14

              	
                Sharing of
      Earnings.  The Borrower shall procure that the Owner
      shall not:

              

      

       

      
        	
                (a)

              	
                enter
      into any agreement or arrangement for the sharing of any
      Earnings;

              

      

       

      
        	
                (b)

              	
                enter
      into any agreement or arrangement for the postponement of any date on
      which any Earnings are due; the reduction of the amount of any Earnings or
      otherwise for the release or adverse alteration of any right of the Owner
      to any Earnings; or

              

      

       

      
        	
                (c)

              	
                enter
      into any agreement or arrangement for the release of, or adverse
      alteration to, any guarantee or Security Interest relating to any
      Earnings.

              

      

       

      
        	
                13.15

              	
                Charterparty
      Assignment.  If the Owner enters into any Future
      Charterparty, the Borrower shall, at the request of the Lender, procure
      that the Owner executes in favour of the Lender a Charterparty Assignment
      in respect of that Charterparty, and shall deliver to the Lender such
      other documents equivalent to those referred to at paragraphs 3, 4 and 5
      of Schedule 2, Part A as the Lender may
require.

              

      

       

      
        	
                14

              	
                SECURITY
      COVER

              

      

       

      
        	
                14.1

              	
                Provision of additional
      security cover; prepayment of Loan.  The Borrower
      undertakes with the Lender that if the Lender notifies the Borrower
      that:

              

      

       

      
        	
                (a)

              	
                the
      Market Value of the Ship; plus

              

      

       

      
        	
                (b)

              	
                the
      net realisable value of any additional security previously provided under
      this Clause 14;

              

      

       

      is
below 125 per cent. of the Loan, the Borrower will, within 14 days after the
date on which the Lender’s notice is served, either:

       

      
        	
                 
      

              	
                (i)

              	
                provide,
      or ensure that a third party provides, additional security which, in the
      opinion of the Lender, has a net realisable value at least equal to the
      shortfall and which, if it consists of or includes a Security Interest,
      covers such asset or assets and is documented in such terms as the Lender
      may approve or require; or

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                prepay
      in accordance with Clause 7 such part (at least) of the Loan as will
      eliminate the shortfall.

              

      

       

      
        	
                14.2

              	
                Meaning of additional
      security.  In Clause 14.1 “security” means a
      Security Interest over an asset or assets (including, without limitation a
      vessel (other than a Ship)) (whether securing the Borrower’s liabilities
      under the Finance Documents or a guarantee in respect of those
      liabilities), or a guarantee, letter of credit, cash deposit or other
      security in respect of the Borrower’s liabilities under the Finance
      Documents.

              

      

       

       

      
        
          
          

        

        
          34

          
            

          

        

        
          
          

        

      

       

      
        	
                14.3

              	
                Requirement for additional
      documents.  The Borrower shall not be deemed to have
      complied with Clause 14.1 (i) above until the Lender has received in
      connection with the additional security certified copies of documents of
      the kinds referred to in paragraphs 3, 4 and 5 of Schedule 2, Part A and
      such legal opinions in terms acceptable to the Lender from such lawyers as
      they may select.

              

      

       

      
        	
                14.4

              	
                Valuation of
      Ship.  The market value of the Ship at any date is that
      shown by a valuation prepared:

              

      

       

      
        	
                (a)

              	
                as
      at a date not more than 15 days
previously;

              

      

       

      
        	
                (b)

              	
                addressed
      to the Lender;

              

      

       

      
        	
                (c)

              	
                by
      an independent ship sale and purchase broker appointed or approved by the
      Lender;

              

      

       

      
        	
                (d)

              	
                with
      or without physical inspection of the Ship (as the Lender may
      require);

              

      

       

      
        	
                (e)

              	
                on
      the basis of a sale for prompt delivery for cash on normal arm's length
      commercial terms as between a willing seller and a willing buyer, free of
      any existing charter or other contract of employment;
  and

              

      

       

      
        	
                (f)

              	
                with
      or without at the option of the Lender;
and

              

      

       

      
        	
                (g)

              	
                after
      deducting the estimated amount of the usual and reasonable expenses which
      would be incurred in connection with the
sale.

              

      

       

      
        	
                14.5

              	
                Value of additional
      security.  The net realisable value of any additional
      security which is provided under Clause 14.1 and which consists of a
      Security Interest over a vessel shall be that shown by a valuation
      complying with the requirements of Clause
14.4.

              

      

       

      
        	
                14.6

              	
                Valuations
      binding.  Any valuation under Clause 14.4 shall be
      binding and conclusive as regards the
Borrower.

              

      

       

      
        	
                14.7

              	
                Provision of
      information.  The Borrower shall promptly provide the
      Lender and any independent ship sale and purchase shipbroker or expert
      acting under Clause 14.4 with any information which the Lender or the
      shipbroker or expert may request for the purposes of the valuation; and,
      if the Borrower fails to provide within 3 Business Days following such
      request, the valuation may be made on any basis and assumptions which the
      independent ship sale and purchase shipbroker or the Lender (or the expert
      appointed by it) considers prudent.

              

      

       

      
        	
                14.8

              	
                Payment of valuation
      expenses.  Without prejudice to the generality of the
      Borrower’s obligations under Clauses 19.2, 19.3 and 20.3, the Borrower
      shall, on demand, pay the Lender the amount of the fees and expenses of
      any shipbroker or expert instructed by the Lender under this
      Clause.

              

      

       

      
        	
                15

              	
                PAYMENTS
      AND CALCULATIONS

              

      

       

      
        	
                15.6

              	
                Currency and method of
      payments.  All payments to be made by the Borrower to the
      Lender under a Finance Document shall be made to the
    Lender:

              

      

       

      
        	
                (a)

              	
                by
      not later than 11.00 a.m. (Piraeus time) on the due
  date;

              

      

       

      
        	
                (b)

              	
                in
      same day Dollar funds settled through the New York Clearing House
      Interbank Payments System (or in such other Dollar funds and/or settled in
      such other manner as the Lender shall specify as being customary at the
      time for the settlement of international transactions of the type
      contemplated by this Agreement);
and

              

      

       

       

      
        
          
          

        

        
          35

          
            

          

        

        
          
          

        

      

       

      
        	
                (c)

              	
                to
      the account of the Lender at Bank of New York, USA or credit to the
      account of the Lender (Account No 8033138548), or to such other account
      with such other bank as the Lender may from time to time notify to the
      Borrower.

              

      

       

      
        	
                15.7

              	
                Payment on non-Business
      Day.  If any payment by the Borrower under a Finance
      Document would otherwise fall due on a day which is not a Business
      Day:

              

      

       

      
        	
                (a)

              	
                the
      due date shall be extended to the next succeeding Business Day;
      or

              

      

       

      
        	
                (b)

              	
                if
      the next succeeding Business Day falls in the next calendar month, the due
      date shall be brought forward to the immediately preceding Business
      Day,

              

      

       

      and
interest shall be payable during any extension under paragraph (a) at the rate
payable on the original due date.

       

      
        	
                15.8

              	
                Basis for calculation of
      periodic payments.  All interest and any other payments
      under any Finance Document which are of an annual or periodic nature shall
      accrue from day to day and shall be calculated on the basis of the actual
      number of days elapsed and a 360 day
year.

              

      

       

      
        	
                15.9

              	
                Lender
      accounts.  The Lender shall maintain an account showing
      the amounts advanced by the Lender and all other sums owing to the Lender
      from the Borrower and each Security Party under the Finance Documents and
      all payments in respect of those amounts made by the Borrower and any
      Security Party.

              

      

       

      
        	
                15.10

              	
                Accounts prima facie
      evidence.  If the account maintained under Clauses 15.9
      shows an amount to be owing by the Borrower or a Security Party to the
      Lender, that account shall be prima facie evidence that that amount is
      owing to the Lender.

              

      

       

      
        	
                16

              	
                APPLICATION
      OF RECEIPTS

              

      

       

      
        	
                16.1

              	
                Normal order of
      application.  Except as any Finance Document may
      otherwise provide, any sums which are received or recovered by the Lender
      under or by virtue of any Finance Document shall be
    applied:

              

      

       

      
        	
                (a)

              	
                FIRST:
      in or towards satisfaction of any amounts then due and payable under the
      Finance Documents in the following
proportions:

              

      

       

      
        	
                 
      

              	
                (i)

              	
                first,
      in or towards satisfaction pro rata of all amounts then due and payable to
      the Lender under the Finance Documents other than those amounts referred
      to at (ii) and (iii) below (including, but without limitation, all amounts
      payable by the Borrowers under Clauses 19, 20 and 21 of this Agreement or
      by the Borrower or any Security Party under any corresponding or similar
      provision in any other Finance
Document);

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                secondly,
      in or towards satisfaction pro rata of any and all amounts of interest or
      default interest payable to the Lender under the Finance Document (but
      shall have failed to pay or deliver to the Lender at the time of
      application or distribution under this Clause 16);
  and

              

      

       

      
        	
                 
      

              	
                (iii)

              	
                thirdly,
      in or towards satisfaction of the
Loan;

              

      

       

       

      
        
          
          

        

        
          36

          
            

          

        

        
          
          

        

      

       

      
        	
                (b)

              	
                SECONDLY:
      in retention of an amount equal to any amount not then due and payable
      under any Finance Document but which the Lender, by notice to the Borrower
      and the Security Parties, states in its opinion will or may become due and
      payable in the future and, upon those amounts becoming due and payable, in
      or towards satisfaction of them in accordance with the foregoing
      provisions of this Clause 16.1; and

              

      

       

      
        	
                (c)

              	
                THIRDLY:
      any surplus shall be paid to the Borrower or to any other person appearing
      to be entitled to it.

              

      

       

      
        	
                16.2

              	
                Variation of order of
      application.  The Lender may, by notice to the Borrower
      and the Security Parties, provide for a different manner of application
      from that set out in Clause 16.1 either as regards a specified sum or
      sums or as regards sums in a specified category or
    categories.

              

      

       

      
        	
                16.3

              	
                Notice of variation of order of
      application.  The Lender may give notices under
      Clause 16.2 from time to time; and such a notice may be stated to
      apply not only to sums which may be received or recovered in the future,
      but also to any sum which has been received or recovered on or after the
      third Business Day before the date on which the notice is
      served.

              

      

       

      
        	
                16.4

              	
                Appropriation rights
      overridden.  This Clause 16 and any notice which the
      Lender gives under Clause 16.2 shall override any right of
      appropriation possessed, and any appropriation made, by the Borrower or
      any Security Party.

              

      

       

      
        	
                17

              	
                APPLICATION
      OF EARNINGS

              

      

       

      
        	
                17.1

              	
                Payment of
      Earnings.  The Borrower undertakes with the Lender to
      ensure that throughout the Security Period (subject only to provisions of
      the General Assignment), all the Earnings of the Ship are paid to the
      Earnings Account.

              

      

       

      
        	
                17.2

              	
                Location of
      accounts.  The Borrower shall
  promptly:

              

      

       

      
        	
                (a)

              	
                comply,
      and ensure that the Owner complies, with any requirement of the Lender as
      to the location or re-location of the Earnings Account;
  and

              

      

       

      
        	
                (b)

              	
                execute,
      and ensure that the Owner executes, any documents which the Lender
      specifies to create or maintain in favour of the Lender a Security
      Interest over (and/or rights of set-off, consolidation or other rights in
      relation to) the Earnings Account.

              

      

       

      
        	
                17.3

              	
                Interest accrued on Earnings
      Account.  Any credit balance on the Earnings Account
      shall bear 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 balances appear to the Lender likely to
      remain on the Earnings Account.

              

      

       

      
        	
                17.4

              	
                Release of accrued
      interest.  Interest accruing under Clause 17.2 shall be
      freely available to the Owner.

              

      

       

      
        	
                17.5

              	
                Debits for expenses
      etc.  The Lender shall be entitled (but not obliged) from
      time to time to debit the Earnings Account without prior notice in order
      to discharge any amount due and payable to it under Clause 19 or 20 or
      payment of which it has become entitled to demand under Clause 19 or
      20.

              

      

       

      
        	
                17.6

              	
                Borrower’s obligations
      unaffected.  The provisions of this Clause 17 do not
      affect:

              

      

       

      
        	
                (a)

              	
                the
      liability of the Borrower to make payments of principal and interest on
      the due dates; or

              

      

       

       

      
        
          
          

        

        
          37

          
            

          

        

        
          
          

        

      

       

      
        	
                (b)

              	
                any
      other liability or obligation of the Borrower or any Security Party under
      any Finance Document.

              

      

       

      
        	
                18

              	
                EVENTS
      OF DEFAULT

              

      

       

      
        	
                18.1

              	
                Events of
      Default.  An Event of Default occurs
  if:

              

      

       

      
        	
                (a)

              	
                the
      Borrower or any Security Party fails to pay when due or if so payable on
      demand, within 2 Business Days of such demand,  any sum payable
      under a Finance Document or under any document relating to a Finance
      Document unless such failure is due to a bank payment transmission error;
      or

              

      

       

      
        	
                (b)

              	
                any
      breach occurs of Clause 8.2, 10.2, 10.3, 10.16, 10.17, 11.2, 11.3, 11.5,
      14.1 or 17.1; or

              

      

       

      
        	
                (c)

              	
                any
      breach by the Borrower or any Security Party occurs of any provision of a
      Finance Document (other than a breach covered by paragraphs (a) or (b)
      above if, in the opinion of the Lender, such default is capable of remedy
      and such default continues unremedied 10 Business Days after written
      notice from the Lender requesting action to remedy the same;
      or

              

      

       

      
        	
                (d)

              	
                (subject
      to any applicable grace period specified in any Finance Document) any
      breach by the Borrower or any Security Party occurs of any provision of a
      Finance Document (other than a breach covered by paragraphs (a), (b) or
      (c) above); or

              

      

       

      
        	
                (e)

              	
                any
      representation, warranty or statement made by, or by an officer of, the
      Borrower or a Security Party in a Finance Document or in the Drawdown
      Notice or any other notice or document relating to a Finance Document is
      untrue or misleading when it is made;
or

              

      

       

      
        	
                (f)

              	
                any
      of the following occurs in relation to any Financial Indebtedness of a
      Relevant Person (exceeding, in the case of the Borrower, $1,000,000 (or
      the equivalent in any other currency), in aggregate:.

              

      

       

      
        	 	
                (i)

              	
                any
      Financial Indebtedness of a Relevant Person is not paid when due or, if so
      payable, on demand; or

              
	 	 	 
	
                 
      

              	
                (ii)

              	
                any
      Financial Indebtedness of a Relevant Person becomes due and payable or
      capable of being declared due and payable prior to its stated maturity
      date as a consequence of any event of default;
  or

              

      

       

      
        	
                 
      

              	
                (iii)

              	
                a
      lease, hire purchase agreement or charter creating any Financial
      Indebtedness of a Relevant Person is terminated by the lessor or owner or
      becomes capable of being terminated as a consequence of any termination
      event; or

              

      

       

      
        	
                 
      

              	
                (iv)

              	
                any
      overdraft, loan, note issuance, acceptance credit, letter of credit,
      guarantee, foreign exchange or other facility, or any swap or other
      derivative contract or transaction, relating to any Financial Indebtedness
      of a Relevant Person ceases to be available or becomes capable of being
      terminated as a result of any event of default, or cash cover is required,
      or becomes capable of being required, in respect of such a facility as a
      result of any event of default; or

              

      

       

      
        	
                 
      

              	
                (v)

              	
                any
      Security Interest securing any Financial Indebtedness of a Relevant Person
      becomes enforceable; or

              

      

       

       

      
        
          
          

        

        
          38

          
            

          

        

        
          
          

        

      

       

      
        	
                (g)

              	
                any
      of the following occurs in relation to a Relevant
  Person:

              

      

       

      
        	
                 
      

              	 	
                (i)

              	
                a
      Relevant Person becomes, in the opinion of the Lender, unable to pay its
      debts as they fall due; or

              

      

       

      
        	
                 
      

              	 	
                (ii)

              	
                any
      assets of a Relevant Person are subject to any form of execution,
      attachment, arrest, sequestration or distress in respect of a sum of, or
      sums aggregating, $1,000,000 or more or the equivalent in another
      currency; or

              

      

       

      
        	
                 
      

              	 	
                (iii)

              	
                any
      administrative or other receiver is appointed over any asset of a Relevant
      Person; or

              

      

       

      
        	
                 
      

              	 	
                (iv)

              	
                a
      Relevant Person makes any formal declaration of bankruptcy or any formal
      statement to the effect that it is insolvent or likely to become
      insolvent, or a winding up or administration order is made in relation to
      a Relevant Person, or the members or directors of a Relevant Person pass a
      resolution to the effect that it should be wound up, placed in
      administration or cease to carry on business, save that this paragraph
      does not apply to a fully solvent winding up of a Relevant Person other
      than the Borrower which is, or is to be, effected for the purposes of an
      amalgamation or reconstruction previously approved by the Lender and
      effected not later than 3 months after the commencement of the winding up;
      or

              

      

       

      
        	
                 
      

              	 	
                (v)

              	
                a
      petition is presented in any Pertinent Jurisdiction for the winding up or
      administration, or the appointment of a provisional liquidator, of a
      Relevant Person; or

              

      

       

      
        	
                 
      

              	 	
                (vi)

              	
                a
      Relevant Person petitions a court, or presents any proposal for, any form
      of judicial or non-judicial suspension or deferral of payments,
      reorganisation of its debt (or certain of its debt) or arrangement with
      all or a substantial proportion (by number or value) of its creditors or
      of any class of them or any such suspension or deferral of payments,
      reorganisation or arrangement is effected by court order, contract or
      otherwise; or

              
	 	 	
                 

              	 
	 	 	
                (vii)

              	
                any
      meeting of the members or directors of a Relevant Person is summoned for
      the purpose of considering a resolution or proposal to authorise or take
      any action of a type described in paragraphs (iii), (iv), (v) or (vi)
      above; or

              
	 	 	 	 
	 	 	
                (viii)

              	
                in
      a Pertinent Jurisdiction other than England, any event occurs or any
      procedure is commenced which, in the opinion of the Lender, is similar to
      any of the foregoing; or

              

      

       

      
        	
                (h)

              	
                the
      Borrower or any Security Party ceases or suspends carrying on or changes
      the nature of its business or a part of its business which, in the opinion
      of the Lender, is material in the context of this Agreement;
      or

              

      

       

      
        	
                (i)

              	
                it
      becomes unlawful in any Pertinent Jurisdiction or
    impossible:

              

      

       

      
        	
                 
      

              	
                (i)

              	
                for
      the Borrower or any Security Party to discharge any liability under a
      Finance Document or to comply with any other obligation which the Lender
      considers material under a Finance Document;
or

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                for
      the Lender to exercise or enforce any right under, or to enforce any
      Security Interest created by, a Finance Document;
  or

              

      

       

       

      
        
          
          

        

        
          39

          
            

          

        

        
          
          

        

      

       

      
        	
                (j)

              	
                any
      consent necessary to enable the Owner to own, operate or charter the Ship
      or to enable the Borrower or any Security Party to comply with any
      provision which the Lender considers material of a Finance Document or the
      MOA is not granted, expires without being renewed, is revoked or becomes
      liable to revocation or any condition of such a consent is not fulfilled;
      or

              

      

       

      
        	
                (k)

              	
                without
      the prior consent of the Lender, Mr. Prokopios Tsirigakis ceases to be, at
      any time during the Security Period, the Chief Executive Officer of the
      Borrower; or 

              

      

       

      
        	
                (l)

              	
                the
      shares of the Borrower cease to be quoted on the Nasdaq National Market in
      New York or any other international recognised stock exchange acceptable
      to the Lender; or

              

      

       

      
        	
                (m)

              	
                without
      the prior written consent or the Lender, a change has occurred after the
      date of this Agreement in the ownership of any of the shares in the Owner
      or in the ultimate control of the voting rights attaching to any of those
      shares; or

              

      

       

      
        	
                (n)

              	
                the
      Initial Charterparty is terminated, cancelled, suspended, rescinded or
      revoked or otherwise ceases to remain in full force and effect for any
      reason except with the consent of the Lender or by effluxion of time
      unless a replacement charter in all respects acceptable to the Lender, to
      be made between the Owner and a charterer acceptable to the Lender, is
      effected within 60 days of the cancellation or termination of the Initial
      Charterparty or the date on which the Initial Charterparty ceases to
      remain in full force and effect or being negotiated;
  or

              

      

       

      
        	
                (o)

              	
                any
      provision which the Lender considers material of a Finance Document proves
      to have been or becomes invalid or unenforceable, or a Security Interest
      created by a Finance Document proves to have been or becomes invalid or
      unenforceable or such a Security Interest proves to have ranked after, or
      loses its priority to, another Security Interest or any other third party
      claim or interest; or

              

      

       

      
        	
                (p)

              	
                the
      security constituted by a Finance Document is in any way imperilled or in
      jeopardy; or

              

      

       

      
        	
                (q)

              	
                any
      other event occurs or any other circumstances arise or develop including,
      without limitation:

              

      

       

      
      

       

      
        	 	
                (i)

              	
                a
      change in the financial position, state of affairs or prospects of the
      Borrower or any Security Party; or

              
	 	 	 
	 	
                (ii)

              	
                any
      accident or other event involving the Ship or another vessel owned,
      chartered or operated by a Relevant Person;

              
	 	 	 

      

       

      in
the light of which the Lender considers that there is a significant risk that
the Borrower or any Security Party is, or will later become, unable to discharge
its liabilities under the Finance Documents as they fall due.

       

      
        	
                18.2

              	
                Actions following an Event of
      Default.  On, or at any time after, the occurrence of an
      Event of Default the Lender may:

              

      

       

      
        	
                (a)

              	
                serve
      on the Borrower a notice stating that the commitment and all obligations
      of the Lender to the Borrower under this Agreement are terminated;
      and/or

              

      

       

       

      
        
          
          

        

        
          40

          
            

          

        

        
          
          

        

      

       

      
        	
                (b)

              	
                serve
      on the Borrower a notice stating that the Loan, all accrued interest and
      all other amounts accrued or owing under this Agreement are immediately
      due and payable or are due and payable on demand;
  and/or

              

      

       

      
        	
                (c)

              	
                take
      any other action which, as a result of the Event of Default or any notice
      served under paragraph (a) or (b) above, the Lender is entitled to take
      under any Finance Document or any applicable
  law.

              

      

       

      
        	
                18.3

              	
                Termination of
      Commitment.  On the service of a notice under
      Clause 18.2(a) the Commitment, and all other obligations of the
      Lender to the Borrower under this Agreement, shall
    terminate.

              

      

       

      
        	
                18.4

              	
                Acceleration of
      Loan.  On the service of a notice under
      Clause 18.2(b), the Loan, all accrued interest and all other amounts
      accrued or owing from the Borrower or any Security Party under this
      Agreement and every other Finance Document shall become immediately due
      and payable or, as the case may be, payable on
  demand.

              

      

       

      
        	
                18.5

              	
                Multiple notices; action
      without notice.  The Lender may serve notices Clauses
      18.2(a) and (b) simultaneously or on different dates and it may take any
      action referred to in Clause 18.2 if no such notice is served or
      simultaneously with or at any time after the service of both or either of
      such notices.

              

      

       

      
        	
                18.6

              	
                Exclusion of Lender
      liability.  Neither the Lender nor any receiver or
      manager appointed by the Lender, shall have any liability to the Borrower
      or a Security Party:

              

      

       

      
        	
                (a)

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

              

      

       

      
        	
                (b)

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

              

      

       

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

       

      
        	
                18.7

              	
                Relevant
      Persons.  In this Clause 18 a “Relevant Person” means
      the Borrower, any Security Party and any other member of the Group; but
      excluding any company which is dormant and the value of whose gross assets
      is $50,000 or less.

              

      

       

      
        	
                18.8

              	
                Interpretation.  In
      Clause 18.1(f) references to an event of default or a termination event
      include any event, howsoever described, which is similar to an event of
      default in a facility agreement or a termination event in a finance lease;
      and in Clause 18.1(g) “petition” includes an
      application.

              

      

       

      
        	
                19

              	
                FEES
      AND EXPENSES

              

      

       

      
        	
                19.1

              	
                Arrangement
      fee.  The Borrower shall pay on the date of this
      Agreement to the Lender a non-refundable arrangement fee of $140,000
      (representing 0.4 per cent. of the
Commitment).

              

      

       

       

      
        
          
          

        

        
          41

          
            

          

        

        
          
          

        

      

       

      
        	
                19.2

              	
                Costs of negotiation,
      preparation etc.  The Borrower shall pay to the Lender on
      its demand the amount of all expenses incurred by the Lender in connection
      with the negotiation, preparation, execution or registration of any
      Finance Document or any related document or with any transaction
      contemplated by a Finance Document or a related document (including,
      without limitation, any legal fees or expenses incurred by the Lender
      with).

              

      

       

      
        	
                19.3

              	
                Costs of variations,
      amendments, enforcement etc.  The Borrower shall pay to
      the Lender, on the Lender's demand, the amount of all expenses (including
      without limitation any legal fees or expenses) incurred by the Lender in
      connection with:

              

      

       

      
        	
                (a)

              	
                any
      amendment or supplement to a Finance Document, or any proposal for such an
      amendment to be made;

              

      

       

      
        	
                (b)

              	
                any
      consent or waiver by the Lender concerned under or in connection with a
      Finance Document, or any request for such a consent or
    waiver;

              

      

       

      
        	
                (c)

              	
                the
      valuation of any security provided or offered under Clause 14 or any
      other matter relating to such security;
or

              

      

       

      
        	
                (d)

              	
                such
      circumstances where the Lender, in its absolute opinion, considers that
      there has been a material change to the insurances in respect of the Ship,
      the review of the insurances of the Ship pursuant to Clause
      12.18;

              

      

       

      
        	
                (e)

              	
                any
      step taken by the Lender with a view to the protection, exercise or
      enforcement of any right or Security Interest created by a Finance
      Document or for any similar
purpose.

              

      

       

      There
shall be recoverable under paragraph (d) the full amount of all legal
expenses, whether or not such as would be allowed under rules of court or any
taxation or other procedure carried out under such rules.

       

      
        	
                19.4

              	
                Documentary
      taxes.  The Borrower shall promptly pay any tax payable
      on or by reference to any Finance Document, and shall, on the Lender's
      demand, fully indemnify the Lender against any liabilities and expenses
      resulting from any failure or delay by the Borrower to pay such a
      tax.

              

      

       

      
        	
                19.5

              	
                Certification of
      amounts.  A notice which is signed by 2 officers of the
      Lender, which states that a specified amount, or aggregate amount, is due
      to the Lender under this Clause 19 and which indicates (without
      necessarily specifying a detailed breakdown) the matters in respect of
      which the amount, or aggregate amount, is due shall be prima facie
      evidence that the amount, or aggregate amount, is
  due.

              

      

       

      
        	
                20

              	
                INDEMNITIES

              

      

       

      
        	
                20.1

              	
                Indemnities regarding borrowing
      and repayment of Loan.  The Borrower shall fully
      indemnify the Lender on its demand in respect of all expenses, liabilities
      and losses which are incurred by the Lender, or which the Lender
      reasonably and with due diligence estimates that it will incur, as a
      result of or in connection with:

              

      

       

      
        	
                (a)

              	
                the
      Loan not being borrowed on the date specified in the Drawdown Notice for
      any reason other than a default by the
Lender;

              

      

       

      
        	
                (b)

              	
                the
      receipt or recovery of all or any part of the Loan or an overdue sum
      otherwise than on the last day of an Interest Period or other relevant
      period;

              

      

       

       

      
        
          
          

        

        
          42

          
            

          

        

        
          
          

        

      

       

      
        	
                (c)

              	
                any
      failure (for whatever reason) by the Borrower to make payment of any
      amount due under a Finance Document on the due date or, if so payable, on
      demand (after giving credit for any default interest paid by the Borrower
      on the amount concerned under
Clause 6);

              

      

       

      
        	
                (d)

              	
                the
      occurrence and/or continuance of an Event of Default or a Potential Event
      of Default and/or the acceleration of repayment of the Loan under
      Clause 18,

              

      

       

      and
in respect of any tax (other than tax on its overall net income) for which the
Lender is liable in connection with any amount paid or payable to the Lender
(whether for its own account or otherwise) under any Finance
Document.

       

      
        	
                20.2

              	
                Breakage
      costs.  Without limiting its generality, Clause 20.1
      covers any liability or loss, including a loss of a prospective profit,
      incurred by the Lender:

              

      

       

      
        	
                (a)

              	
                in
      liquidating or employing deposits from third parties acquired or arranged
      to fund or maintain all or any part of the Loan and/or any overdue amount
      (or an aggregate amount which includes the Loan or any overdue amount);
      and

              

      

       

      
        	
                (b)

              	
                in
      terminating, or otherwise in connection with, any interest and/or currency
      swap or any other transaction entered into (whether with another legal
      entity or with another office or department of the Lender) to hedge any
      exposure arising under this Agreement or a number of transactions of which
      this Agreement is one.

              

      

       

      
        	
                20.3

              	
                Miscellaneous
      indemnities.  The Borrower shall fully indemnify the
      Lender on its demand in respect of all claims, demands, proceedings,
      liabilities, taxes, losses and expenses or every king (“liability items”)
      which may be made or brought against or incurred by the Lender, in any
      country, in relation to:

              

      

       

      
        	
                (a)

              	
                any
      action taken, or omitted or neglected to be taken, under or in connection
      with any Finance Document by the Lender or by any receiver appointed under
      a Finance Document;

              

      

       

      
        	
                (b)

              	
                any
      other event, matter or question which occurs or arises at any time during
      the Security Period and which has any connection with, or any bearing on,
      any Finance Document, any payment or other transaction relating to a
      Finance Document or any asset covered (or previously covered) by a
      Security Interest created (or intended to be created) by a Finance
      Document,

              

      

       

      other
than claims, expenses, liabilities and losses which are shown to have been
directly and mainly caused by the dishonesty or wilful misconduct of the
officers or employees of the Lender.

      

      Without
prejudice to its generality, this Clause 20.3 covers any claims, expenses,
liabilities and losses which arise, or are asserted, under or in connection with
any law relating to safety at sea, the ISM Code, the ISPS Code or any
Environmental Law.

      

      
        	
                20.4

              	
                Currency
      indemnity.  If any sum due from the Borrower or any
      Security Party to the Lender under a Finance Document or under any order
      or judgment relating to a Finance Document has to be converted from the
      currency in which the Finance Document provided for the sum to be paid
      (the “Contractual
      Currency”) into another currency (the “Payment Currency”) for
      the purpose of:

              

      

       

      
        	
                (a)

              	
                making
      or lodging any claim or proof against the Borrower or any Security Party,
      whether in its liquidation, any arrangement involving it or otherwise;
      or

              

      

       

       

      
        
          
          

        

        
          43

          
            

          

        

        
          
          

        

      

       

      
        	
                (b)

              	
                obtaining
      an order or judgment from any court or other tribunal;
  or

              

      

       

      
        	
                (c)

              	
                enforcing
      any such order or judgment,

              

      

       

      the
Borrower shall indemnify the Lender against the loss arising when the amount of
the payment actually received by the Lender is converted at the available rate
of exchange into the Contractual Currency.

       

      In
this Clause 20.4, the “available rate of exchange”
means the rate at which the Lender is able at the opening of business (Piraeus
time) on the Business Day after it receives the sum concerned to purchase the
Contractual Currency with the Payment Currency.

       

      This
Clause 20.4 creates a separate liability of the Borrower which is distinct
from its other liabilities under the Finance Documents and which shall not be
merged in any judgment or order relating to those other
liabilities.

       

      
        	
                20.5

              	
                Certification of
      amounts.  A notice which is signed by 2 officers of the
      Lender, which states that a specified amount, or aggregate amount, is due
      to the Lender under this Clause 20 and which indicates (without
      necessarily specifying a detailed breakdown) the matters in respect of
      which the amount, or aggregate amount, is due shall be prima facie
      evidence that the amount, or aggregate amount, is
  due.

              

      

       

      
        	
                21

              	
                NO
      SET-OFF OR TAX DEDUCTION

              

      

       

      
        	
                21.1

              	
                No
      deductions.  All amounts due from the Borrower under a
      Finance Document shall be paid:

              

      

       

      
        	
                (a)

              	
                without
      any form of set-off, cross-claim or condition;
  and

              

      

       

      
        	
                (b)

              	
                free
      and clear of any tax deduction except a tax deduction which the Borrower
      is required by law to make.

              

      

       

      
        	
                21.2

              	
                Grossing-up for
      taxes.  If the Borrower is required by law to make a tax
      deduction from any payment:

              

      

       

      
        	
                (a)

              	
                the
      Borrower shall notify the Lender as soon as it becomes aware of the
      requirement;

              

      

       

      
        	
                (b)

              	
                the
      Borrower shall pay the tax deducted to the appropriate taxation authority
      promptly, and in any event before any fine or penalty arises;
      and

              

      

       

      
        	
                (c)

              	
                the
      amount due in respect of the payment shall be increased by the amount
      necessary to ensure that the Lender receives and retains (free from any
      liability relating to the tax deduction) a net amount which, after the tax
      deduction, is equal to the full amount which it would otherwise have
      received.

              

      

       

      
        	
                21.3

              	
                Evidence of payment of
      taxes.  Within one month after making any tax deduction,
      the Borrower shall deliver to the Lender documentary evidence satisfactory
      to the Lender that the tax had been paid to the appropriate taxation
      authority.

              

      

       

       

      
        
          
          

        

        
          44

          
            

          

        

        
          
          

        

      

       

      
        	
                21.4

              	
                Exclusion of tax on overall net
      income.  In this Clause 21 “tax deduction” means any
      deduction or withholding for or on account of any present or future tax
      except tax on the Lender's overall net
income.

              

      

       

      
        	
                22

              	
                ILLEGALITY,
      ETC

              

      

       

      
        	
                22.1

              	
                Illegality.  This
      Clause 22 applies if the Lender notifies the Borrower that it has
      become, or will with effect from a specified date,
  become:

              

      

       

      
        	
                (a)

              	
                unlawful
      or prohibited as a result of the introduction of a new law, an amendment
      to an existing law or a change in the manner in which an existing law is
      or will be interpreted or applied;
or

              

      

       

      
        	
                (b)

              	
                contrary
      to, or inconsistent with, any
regulation,

              

      

       

      for
the Lender to maintain or give effect to any of its obligations under this
Agreement in the manner contemplated by this Agreement.

       

      
        	
                22.2

              	
                Notification and effect of
      illegality.  On the Lender notifying the Borrower under
      Clause 22.1, the Commitment shall terminate; and thereupon or, if
      later, on the date specified in the Lender's notice under Clause 22.1
      as the date on which the notified event would become effective the
      Borrower shall prepay the Loan in full in accordance with
      Clause 7.

              

      

       

      
        	
                22.3

              	
                Mitigation.  If
      circumstances arise which would result in a notification under
      Clause 22.1 then, without in any way limiting the rights of the
      Lender under Clause 22.3, the Lender shall use reasonable endeavours
      to transfer its obligations, liabilities and rights under this Agreement
      and the Finance Documents to another office or financial institution not
      affected by the circumstances but the Lender shall not be under any
      obligation to take any such action if, in its opinion, to do would or
      might:

              

      

       

      
        	
                (a)

              	
                have
      an adverse effect on its business, operations or financial condition;
      or

              

      

       

      
        	
                (b)

              	
                involve
      it in any activity which is unlawful or prohibited or any activity that is
      contrary to, or inconsistent with, any regulation;
  or

              

      

       

      
        	
                (c)

              	
                involve
      it in any expense (unless indemnified to its satisfaction) or tax
      disadvantage.

              

      

       

      
        	
                23

              	
                INCREASED
      COSTS

              

      

       

      
        	
                23.1

              	
                Increased
      costs.  This Clause 23 applies if the Lender
      notifies the Borrower that it considers that as a result
    of:

              

      

       

      
        	
                (a)

              	
                the
      introduction or alteration after the date of this Agreement of a law or an
      alteration after the date of this Agreement in the manner in which a law
      is interpreted or applied (disregarding any effect which relates to the
      application to payments under this Agreement of a tax on the Lender's
      overall net income); or

              

      

       

      
        	
                (b)

              	
                complying
      with any regulation (including any which relates to capital adequacy or
      liquidity controls or which affects the manner in which the Lender
      allocates capital resources to its obligations under this Agreement
      (including, without limitation, any laws or regulations which shall
      replace, amend and/or supplement 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 Management
      and Capital Structures”)) which is introduced, or altered, or the
      interpretation or application of which is altered, after the date of this
      Agreement,

              

      

       

       

      
        
          
          

        

        
          45

          
            

          

        

        
          
          

        

      

       

      the
Lender (or a parent company of it) has incurred or will incur an “increased cost”.

       

      
        	
                23.2

              	
                Meaning of “increased
      cost”.  In this Clause 23, “increased cost”
      means:

              

      

       

      
        	
                (a)

              	
                an
      additional or increased cost incurred as a result of, or in connection
      with, the Lender having entered into, or being a party to, this Agreement
      or having taken an assignment of rights under this Agreement, of funding
      or maintaining the Commitment or performing its obligations under this
      Agreement, or of having outstanding all or any part of the Loan or other
      unpaid sums; or

              

      

       

      
        	
                (b)

              	
                a
      reduction in the amount of any payment to the Lender under this Agreement
      or in the effective return which such a payment represents to the Lender
      or on its capital;

              

      

       

      
        	
                (c)

              	
                an
      additional or increased cost of funding all or maintaining all or any of
      the advances comprised in a class of advances formed by or including the
      Loan or (as the case may require) the proportion of that cost attributable
      to the Loan; or

              

      

       

      
        	
                (d)

              	
                a
      liability to make a payment, or a return foregone, which is calculated by
      reference to any amounts received or receivable by the Lender under this
      Agreement;

              

      

       

      but
not an item attributable to a change in the rate of tax on the overall net
income of the Lender (or a parent company of it) or an item covered by the
indemnity for tax in Clause 20.1 or by Clause 21.

       

      For
the purposes of this Clause 23.2 the Lender may in good faith allocate or
spread costs and/or losses among its assets and liabilities (or any class
thereof) on such basis as it considers appropriate.

       

      
        	
                23.3

              	
                Payment of increased
      costs.  The Borrower shall pay to the Lender, on its
      demand, the amounts which the Lender from time to time notifies the
      Borrower that it has specified to be necessary to compensate it for the
      increased cost.

              

      

       

      
        	
                23.4

              	
                Notice of
      prepayment.  If the Borrower is not willing to continue
      to compensate the Lender for the increased cost under Clause 23.3,
      the Borrower may give the Lender not less than 14 days' notice of its
      intention to prepay the Loan at the end of an Interest
    Period.

              

      

       

      
        	
                23.5

              	
                Prepayment.  A
      notice under Clause 23.4 shall be irrevocable; and on the date
      specified in the Borrower’s notice of intended prepayment, the Commitment
      shall terminate and the Borrower shall prepay (without premium or penalty)
      the Loan, together with accrued interest thereon at the applicable rate
      plus the  Margin.

              

      

       

      
        	
                23.6

              	
                Application of
      prepayment.  Clause 7 shall apply in relation to the
      prepayment.

              

      

       

      
        	
                24

              	
                SET-OFF

              

      

       

      
        	
                24.1

              	
                Application of credit
      balances.  The Lender may without prior
      notice:

              

      

       

      
        	
                (a)

              	
                apply
      any balance (whether or not then due) which at any time stands to the
      credit of any account in the name of the Borrower at any office in any
      country of the Lender in or towards satisfaction of any sum then due from
      the Borrower to the Lender under any of the Finance Documents;
      and

              

      

       

       

      
        
          
          

        

        
          46

          
            

          

        

        
          
          

        

      

       

      
        	
                (b)

              	
                for
      that purpose:

              

      

       

      
        	
                 
      

              	
                (i)

              	
                break,
      or alter the maturity of, all or any part of a deposit of the
      Borrower;

              

      

       

      
        	
                 
      

              	
                (ii)

              	
                convert
      or translate all or any part of a deposit or other credit balance into
      Dollars; and

              

      

       

      
        	
                 
      

              	
                (iii)

              	
                enter
      into any other transaction or make any entry with regard to the credit
      balance which the Lender considers
appropriate.

              

      

       

      
        	
                24.2

              	
                Existing rights
      unaffected.  The Lender shall not be obliged to exercise
      any of its rights under Clause 24.1; and those rights shall be
      without prejudice and in addition to any right of set-off, combination of
      accounts, charge, lien or other right or remedy to which the Lender is
      entitled (whether under the general law or any
  document).

              

      

       

      
        	
                24.3

              	
                No Security
      Interest.  This Clause 24 gives the Lender a contractual
      right of set-off only, and does not create any equitable charge or other
      Security Interest over any credit balance of the
  Borrower.

              

      

       

      
        	
                25

              	
                TRANSFERS
      AND CHANGES IN LENDING OFFICE

              

      

       

      
        	
                25.1

              	
                Transfer by
      Borrower.  The Borrower may not, without the consent of
      the Lender, transfer any of its rights or obligations under any Finance
      Document.

              

      

       

      
        	
                25.2

              	
                Assignment by
      Lender.  The Lender may assign all or any of the rights
      and interests which it has under or by virtue of the Finance Documents to
      another bank or financial
institution.

              

      

       

      
        	
                25.3

              	
                Rights of
      assignee.  In respect of any breach of a warranty,
      undertaking, condition or other provision of a Finance Document, or any
      misrepresentation made in or in connection with a Finance Document, a
      direct or indirect assignee of any of the Lender's rights or interests
      under or by virtue of the Finance Documents shall be entitled to recover
      damages by reference to the loss incurred by that assignee as a result of
      the breach or misrepresentation irrespective of whether the Lender would
      have incurred a loss of that kind or
amount.

              

      

       

      
        	
                25.4

              	
                Sub-participation; subrogation
      assignment.  The Lender may sub-participate all or any
      part of its rights and/or obligations under or in connection with the
      Finance Documents without the consent of, or any notice to, the Borrower;
      and the Lender may assign, in any manner and terms agreed by it, all or
      any part of those rights to an insurer or surety who has become subrogated
      to them.

              

      

       

      
        	
                25.5

              	
                Disclosure of
      information.  The Lender may disclose to a potential
      assignee or sub-participant any information which the Lender has received
      in relation to the Borrower, any Security Party or their affairs under or
      in connection with any Finance Document, unless the information is clearly
      of a confidential nature.

              

      

       

      
        	
                25.6

              	
                Change of lending
      office.  The Lender may change its lending office by
      giving notice to the Borrower and the change shall become effective on the
      later of:

              

      

       

      
        	
                (a)

              	
                the
      date on which the Borrower receives the notice;
  and

              

      

       

       

      
        
          
          

        

        
          47

          
            

          

        

        
          
          

        

      

       

      
        	
                (b)

              	
                the
      date, if any, specified in the notice as the date on which the change will
      come into effect.

              

      

       

      
        	
                26

              	
                VARIATIONS
      AND WAIVERS

              

      

       

      
        	
                26.1

              	
                Variations, waivers etc. by
      Lender.  A document shall be effective to vary, waive,
      suspend or limit any provision of a Finance Document, or the Lender's
      rights or remedies under such a provision or the general law, only if the
      document is signed, or specifically agreed to by fax, by the Borrower and
      the Lender and, if the document relates to a Finance Document to which a
      Security Party is party, by that Security
Party.

              

      

       

      
        	
                26.2

              	
                Exclusion of other or implied
      variations.  Except for a document which satisfies the
      requirements of Clause 26.1, no document, and no act, course of
      conduct, failure or neglect to act, delay or acquiescence on the part of
      the Lender (or any person acting on its behalf) shall result in the Lender
      (or any person acting on its behalf) being taken to have varied, waived,
      suspended or limited, or being precluded (permanently or temporarily) from
      enforcing, relying on or
exercising:

              

      

       

      
        	
                (a)

              	
                a
      provision of this Agreement or another Finance Document;
  or

              

      

       

      
        	
                (b)

              	
                an
      Event of Default; or

              

      

       

      
        	
                (c)

              	
                a
      breach by the Borrower or a Security Party of an obligation under a
      Finance Document or the general law;
or

              

      

       

      
        	
                (d)

              	
                any
      right or remedy conferred by any Finance Document or by the general
      law,

              

      

       

      and
there shall not be implied into any Finance Document any term or condition
requiring any such provision to be enforced, or such right or remedy to be
exercised, within a certain or reasonable time.

       

      
        	
                27

              	
                NOTICES

              

      

       

      
        	
                27.1

              	
                General.  Unless
      otherwise specifically provided, any notice under or in connection with
      any Finance Document shall be given by registered letter or fax; and
      references in the Finance Documents to written notices, notices in writing
      and notices signed by particular persons shall be construed
      accordingly.

              

      

       

      
        	
                27.2

              	
                Addresses for
      communications.  A notice shall be
  sent:

              

      

       

      
      

       

      
        	(a)	to the
      Borrower:	 	Aethrion Centre	 
	 	 	 	40 Ag.
      Konstantinou Avenue	 
	 	 	 	151 24
      Marousi	 
	 	 	 	Athens, Greece	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	Fax
      No:       + 30 210 61 95
819	 
	 	 	 	Attn:
      the Chief Financial Officer	 
	 	 	 	 	 
	 	 	 	 	 
	(b)	to the
      Lender:	 	Piraeus
      Bank A.E.	 
	 	 	 	47-49
      Akti Miaouli	 
	 	 	 	185 36
      Piraeus	 
	 	 	 	Greece	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	Fax
      No:        +30 210 42 9
      2601	 
	 	 	 	Attn:
      Relationship Manager	 

      

       

      or
to such other address as the relevant party may notify the other.

       

       

      
        
          
          

        

        
          48

          
            

          

        

        
          
          

        

      

       

      
        	
                27.3

              	
                Effective date of
      notices.  Subject to Clauses 27.4
      and 27.5:

              

      

       

      
        	
                (a)

              	
                a
      notice which is delivered personally shall be deemed to be served, and
      shall take effect, at the time when it is delivered;
  and

              

      

       

      
        	
                (b)

              	
                a
      notice which is delivered by registered letter shall be deemed to be
      served, and shall take effect, 5 Business Days after being deposited in
      the post postage prepaid in an envelope addressed to it at the relevant
      address; and

              

      

       

      
        	
                (c)

              	
                a
      notice which is sent by fax shall be deemed to be served, and shall take
      effect, 2 hours after its transmission is
  completed.

              

      

       

      
        	
                27.4

              	
                Service outside business
      hours.  However, if under Clause 27.3 a notice would
      be deemed to be served:

              

      

       

      
        	
                (a)

              	
                on
      a day which is not a Business Day in the place of receipt;
    or

              

      

       

      
        	
                (b)

              	
                on
      such a Business Day, but after 5 p.m. local
  time,

              

      

       

      the
notice shall (subject to Clause 27.5) be deemed to be served, and shall
take effect, at 9 a.m. on the next day which is such a business
day.

       

      
        	
                27.5

              	
                Illegible
      notices.  Clauses 27.3 and 27.4 do not apply if
      the recipient of a notice notifies the sender within 1 hour after the time
      at which the notice would otherwise be deemed to be served that the notice
      has been received in a form which is illegible in a material
      respect.

              

      

       

      
        	
                27.6

              	
                Valid
      notices.  A notice under or in connection with a Finance
      Document shall not be invalid by reason that its contents or the manner of
      serving it do not comply with the requirements of this Agreement or, where
      appropriate, any other Finance Document under which it is served
      if:

              

      

       

      
        	
                (a)

              	
                the
      failure to serve it in accordance with the requirements of this Agreement
      or other Finance Document, as the case may be, has not caused any party to
      suffer any significant loss or prejudice;
or

              

      

       

      
        	
                (b)

              	
                in
      the case of incorrect and/or incomplete contents, it should have been
      reasonably clear to the party on which the notice was served what the
      correct or missing particulars should have
been.

              

      

       

      
        	
                27.7

              	
                English
      language.  Any notice under or in connection with a
      Finance Document shall be in
English.

              

      

       

      
        	
                27.8

              	
                Meaning of
      “notice”.  In this Clause 28 “notice” includes any
      demand, consent, authorisation, approval, instruction, waiver or other
      communication.

              

      

       

       

      
        
          
          

        

        
          49

          
            

          

        

        
          
          

        

      

       

      
        	
                28

              	
                SUPPLEMENTAL

              

      

       

      
        	
                28.1

              	
                Rights cumulative,
      non-exclusive.  The rights and remedies which the Finance
      Documents give to the Lender are:

              

      

       

      
        	
                (a)

              	
                cumulative;

              

      

       

      
        	
                (b)

              	
                may
      be exercised as often as appears expedient;
and

              

      

       

      
        	
                (c)

              	
                shall
      not, unless a Finance Document explicitly and specifically states so, be
      taken to exclude or limit any right or remedy conferred by any
      law.

              

      

       

      
        	
                28.2

              	
                Severability of
      provisions.  If any provision of a Finance Document is or
      subsequently becomes void, unenforceable or illegal, that shall not affect
      the validity, enforceability or legality of the other provisions of that
      Finance Document or of the provisions of any other Finance
      Document.

              

      

       

      
        	
                28.3

              	
                Third party
      rights.  A person who is not a party to this Agreement
      has no right under the Contracts (Rights of Third Parties) Act 1999 to
      enforce or to enjoy the benefit of any term of this
    Agreement.

              

      

       

      
        	
                28.4

              	
                Counterparts.  A
      Finance Document may be executed in any number of
      counterparts.

              

      

       

      
        	
                29

              	
                LAW
      AND JURISDICTION

              

      

       

      
        	
                29.1

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

              

      

       

      
        	
                29.2

              	
                Exclusive English
      jurisdiction.  Subject to Clause 29.3, the courts of
      England shall have exclusive jurisdiction to settle any disputes which may
      arise out of or in connection with this
  Agreement.

              

      

       

      
        	
                29.3

              	
                Choice of forum for the
      exclusive benefit of the Lender.  Clause 29.2 is for
      the exclusive benefit of the Lender, which reserves the
    right:

              

      

       

      
        	
                (a)

              	
                to
      commence proceedings in relation to any matter which arises out of or in
      connection with this Agreement in the courts of any country other than
      England and which have or claim jurisdiction to that matter;
      and

              

      

       

      
        	
                (b)

              	
                to
      commence such proceedings in the courts of any such country or countries
      concurrently with or in addition to proceedings in England or without
      commencing proceedings in England.  The Borrower shall not
      commence any proceedings in any country other than England in relation to
      a matter which arises out of or in connection with this
      Agreement.

              

      

       

      
        	
                29.4

              	
                Process
      agent.  The Borrower irrevocably appoints Eurofin
      International Ltd. at its office for the time being presently at Chelsea
      Harbour, London SW10 0XD, England, to act as its agent to receive and
      accept on its behalf any process or other document relating to any
      proceedings in the English courts which are connected with this
      Agreement.

              

      

       

       

      
        
          
          

        

        
          50

          
            

          

        

        
          
          

        

      

       

      
        	
                29.5

              	
                Lender's rights
      unaffected.  Nothing in this Clause 28.4 shall
      exclude or limit any right which the Lender may have (whether under the
      law of any country, an international convention or otherwise) with regard
      to the bringing of proceedings, the service of process, the recognition or
      enforcement of a judgment or any similar or related matter in any
      jurisdiction.

              

      

       

      
        	
                29.6

              	
                Meaning of
      “proceedings”.  In this Clause 28.4, “proceedings” means
      proceedings of any kind, including an application for a provisional or
      protective measure.

              

      

       

      THIS AGREEMENT has been
entered into on the date stated at the beginning of this
Agreement.

      
        
           

        

        
          51

          
            

          

        

        
           

        

      

    

    

    SCHEDULE
1

     

    

     

    DRAWDOWN
NOTICE

     

    

     

    
      	To: 	
              Piraeus
      Bank A.E.

            
	 	
              47-49
      Akti Miaouli

            
	 	
              185
      36 Piraeus

            
	 	
              Greece

            

    

    

Attention:
Loans
Administration                                                                                                                                                                        
                     June
2008

    

    DRAWDOWN
NOTICE

    

    
      	
              2  

            	
              We
      refer to the loan agreement (the “Loan Agreement”)
      dated           June
      2008 and made between us, as Borrower, and you, as Lender, in connection
      with a loan facility of up to US$35,000,000. Terms defined in the Loan
      Agreement have their defined meanings when used in this Drawdown
      Notice.

            

    

     

    
      	
              3  

            	
              We
      request to borrow the Loan as
follows:

            

    

     

    
      	
              (a)  

            	
              Amount
      : $[l];

            

    

     

    
      	
              (b)  

            	
              Drawdown
      Date:  [l]
      2008;

            

    

     

    
      	
              (c)  

            	
              Duration
      of the first Interest Period:  [l]
      months;

            

    

     

    
      	
              (d)  

            	
              Payment
      instructions :
      [                                                   ].

            

    

     

    
      	
              4  

            	
              We
      represent and warrant that:

            

    

     

    
      	
              (a)  

            	
              the
      representations and warranties in Clause 9 of the Loan Agreement
      would remain true and not misleading if repeated on the date of this
      notice with reference to the circumstances now
  existing;

            

    

     

    
      	
              (b)  

            	
              no
      Event of Default or Potential Event of Default has occurred or will result
      from the borrowing of the Loan.

            

    

     

    
      	
              5  

            	
              This
      notice cannot be revoked without the prior consent of the
      Lender.

            

    

     

    
      	
              6  

            	
              [We
      authorise you to deduct the arrangement fee referred to in Clause 19.1
      from the amount of the Loan].

            

    

     

    

    

    

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

    

    for and
on behalf of

     

     

    
      
        
        

      

      
        52

        
          

        

      

      
        
        

      

    

     

    STAR
BULK CARRIERS CORP.

    SCHEDULE
2

     

    

     

    CONDITION
PRECEDENT DOCUMENTS

     

    

    Part
A

    

    The
following are the documents referred to in Clause 8.1(a).

    

    
      	
              1  

            	
              A
      duly executed original:

            

    

     

    
      	
              (a)  

            	
              this
      Agreement;

            

    

     

    
      	
              (b)  

            	
              the
      Guarantee; and

            

    

     

    
      	
              (c)  

            	
              the
      Accunt Pledge.

            

    

     

    
      	
              2  

            	
              Copies
      of the certificate of incorporation and constitutional documents of the
      Borrower and the Owner.

            

    

     

    
      	
              3  

            	
              Copies
      of resolutions of the directors of the Borrower and of the directors and
      shareholders of the Owner authorising the execution of each of the Finance
      Documents to which the Borrower or the Owner (as the case may be) is a
      party and, in the case of the Borrower, authorising named officers to give
      the Drawdown Notice and other notices under this
  Agreement.

            

    

     

    
      	
              4  

            	
              The
      original of any power of attorney under which any Finance Document is
      executed on behalf of the Borrower and the
  Owner.

            

    

     

    
      	
              5  

            	
              Copies
      of all consents which the Borrower or any Security Party requires to enter
      into, or make any payment under, any Finance Document to which it is a
      party and, in the case of the Owner, the
MOA.

            

    

     

    
      	
              6  

            	
              The
      originals of any mandates or other documents required in connection with
      the opening or operation of the Earnings
  Account.

            

    

     

    
      	
              7  

            	
              Evidence
      satisfactory to the Lender that each Owner is a direct or indirect
      wholly-owned subsidiary of the
Borrower.

            

    

     

    
      	
              8  

            	
              A
      copy of the MOA and of all documents signed or issued by the Owner or the
      Seller (or either of them) under or in connection with the
      MOA.

            

    

     

    
      	
              9  

            	
              Such
      documentary evidence as the Lender and its legal advisers may require in
      relation to the due authorisation and execution by the Seller of the MOA
      and of all documents to be executed by the Seller under the
      MOA.

            

    

     

    
      	
              10  

            	
              All
      documentation required by the Lender in relation to the Borrower and any
      Security Party pursuant to the Lender’s “know your customer”
      requirements.

            

    

     

    
      	
              11  

            	
              Documentary
      evidence that the agent for service of process named in Clause 28.4 has
      accepted its appointment.

            

    

     

    
      	
              12  

            	
              Favourable
      legal opinions from lawyers appointed by the Lender on such matters
      concerning the laws of the Marshall Islands and such other relevant
      jurisdictions as the Lender may
require.

            

    

     

    
      	
              13  

            	
              If
      the Lender so requires, in respect of any of the documents referred to
      above, a certified English translation prepared by a translator approved
      by the Lender.

            

    

     

    

    
      
         

      

      
        53

        
          

        

      

      
         

      

    

    

    PART
B

    

    The
following are the documents referred to in Clause 8.1(b).

    

    
      	
              1  

            	
              A
      copy of the Initial Charterparty (showing a net charter rate of not less
      than (i) $53,454 per day until 1 March 2009 (ii) $40,067 per day for the
      12-month period commencing on 1 March 2009 and (iii) $26,575 per day for
      the 12-month period commencing on 1 March 2010) and of all documents
      signed or issued by the parties thereto under or in connection with the
      Initial Charterparty.

            

    

     

    
      	
              2  

            	
              A
      duly executed original of the Mortgage, the Deed of Covenant, the General
      Assignment, the Account Pledge and (if applicable) any Charter Assignment
      for the Ship (and of each document to be delivered under each of
      them).

            

    

     

    
      	
              3  

            	
              Documentary
      evidence that:

            

    

     

    
      	
              (a)  

            	
              the
      Ship has been unconditionally delivered to, and accepted by, the Owner
      under the MOA and the full purchase price payable under the MOA (in
      addition to the part financed by the Loan) has been duly paid, together
      with a copy of the bill of sale and the other documents delivered by the
      Seller thereunder;

            

    

     

    
      	
              (b)  

            	
              the
      Ship is definitively and permanently registered in the name of the Owner
      under the Marshall Islands flag;

            

    

     

    
      	
              (c)  

            	
              the
      Ship is in the absolute and unencumbered ownership of the Owner save as
      contemplated by the Finance
Documents;

            

    

     

    
      	
              (d)  

            	
              the
      Ship maintains the highest available class with Det Norske Veritas (or
      such other first-class classification society which is a member of IACS as
      the Lender may approve) free of all overdue recommendations and conditions
      of such classification society;

            

    

     

    
      	
              (e)  

            	
              the
      Mortgage has been duly registered against the Ship as a valid first
      preferred ship mortgage in accordance with the laws of the Marshall
      Islands; and

            

    

     

    
      	
              (f)  

            	
              the
      Ship is insured in accordance with the provisions of this Agreement and
      all requirements therein in respect of insurances have been complied
      with.

            

    

     

    
      	
              4  

            	
              A
      copy of the Management Agreement and a duly executed original of the
      Manager’s Undertaking in relation to the
Ship.

            

    

     

    
      	
              5  

            	
              Copies
      of:

            

    

     

    
      	
              (a)  

            	
              the
      document of compliance (DOC) and safety management  certificate
      (SMC) referred to in paragraph (a) of the definition of the ISM Code
      Documentation in respect of the Ship and the Approved Manager certified as
      true and in effect by the Owner;
and

            

    

     

    
      	
              (b)  

            	
              the
      ISPS Code Documentation in respect of the Ship and the Owner certified as
      true and in effect by the Owner.

            

    

     

    
      	
              6  

            	
              A
      valuation (at the cost of the Borrower) of the Ship prepared by an
      independent ship broker appointed or approved by the Lender, addressed to
      the Lender, stated to be for the purpose of this Agreement and dated not
      earlier than 15 days before the Drawdown Date showing the Market Value of
      the Ship in an amount satisfactory to the
  Lender.

            

    

     

     

    
      
        
        

      

      
        54

        
          

        

      

      
        
        

      

    

     

    
      	
              7  

            	
              A
      favourable legal opinion from lawyers appointed by the Lender on such
      matters concerning the laws of the Marshall Islands and such other
      relevant jurisdictions as the Lender may
  require.

            

    

     

    
      	
              8  

            	
              A
      favourable opinion from an independent insurance consultant acceptable to
      the Lender on such matters relating to the insurances for the Ship as the
      Lender may require.

            

    

     

    
      	
              9  

            	
              If
      the Lender so requires, in respect of any of the documents referred to
      above, a certified English translation prepared by a translator approved
      by the Lender.

            

    

     

    Every
other copy document delivered under this Schedule shall be certified as a true
and up to date copy by a director or the secretary (or equivalent officer) of
the Borrower or any other person acceptable to the Lender in its sole
discretion.

    

    

    

    
      
         

      

      
        55

        
          

        

      

      
         

      

    

    SCHEDULE
3

     

    

     

    FORM
OF COMPLIANCE CERTIFICATE

     

    
    

     

    
      	To: 	
              Piraeus
      Bank A.E.

            
	 	
              47-49
      Akti Miaouli

            
	 	
              185
      36 Piraeus

            
	 	
              Greece

            

    

     

    
 

    

                                                                  
[l] 200[l]

    

    Dear
Sirs,

    

    We refer
to a loan agreement dated [l] 2008 (the “Loan Agreement”) made between
(amongst others) yourselves and ourselves in relation to a term loan facility of
up to $35,000,000.

    

    Words and
expressions defined in the Loan Agreement shall have the same meaning when used
in this compliance certificate.

    

    We
enclose with this certificate a copy of the [audited]/[unaudited] consolidated
accounts for the Group for the [financial year] [3-month period] ended [l].  The
accounts (i) have been prepared in accordance with all applicable laws and GAAP
all consistently applied, (ii) give a true and fair view of the state of affairs
of the Group at the date of the accounts and of its profit for the period to
which the accounts relate and (iii) fully disclose or provide for all
significant liabilities of the Group.

    

    We also
enclose copies of the valuations of all the Fleet Vessels which were used for
the purpose of calculating the Leverage Ratio as at [l].

    

    The
Borrower represents that no Event of Default or Potential Event of Default has
occurred as at the date of this certificate [except for the following matter or
event [set out all material
details of matter or event]].  In addition as of [l], the Borrower confirms
compliance with the financial covenants set out in Clause 11.5 of the Loan
Agreement for the 3 months ending as of the date to which the enclosed accounts
are prepared.

    

    We now
certify that, as at [l]:

    

    
      	
              (a)  

            	
              the
      Interest Coverage Ratio is [l]:[l];

            

    

     

    
      	
              (b)  

            	
               the
      Leverage Ratio is [l]:[l];
    and

            

    

     

    
      	
              (b)  

            	
              the
      Liquid Funds are $[l], representing
      $[l] per
      Fleet Vessel,

            

    

     

    as shown
in the attached calculation sheets.

     

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

    

    

    ______________________________

    [l]

    Chief
Financial Officer of

    STAR
BULK CARRIERS CORP.

    

    

    
      
        
        

      

      
        56

        
          

        

      

      
        
        

      

    

    

    

    

    EXECUTION
PAGE

     

    

    

    

    BORROWER

    

    

    
      	
              SIGNED
by

            	
              )

            
	
              for
      and on behalf of

            	
              )

            
	
              STAR
      BULK CARRIERS CORP.

            	
              )

            
	
              in
      the presence of:

            	
              )

            

    

    

    

    

    

    

    LENDER

    

    

    
      	
              SIGNED
by

            	
              )

            
	
              for
      and on behalf of

            	
              )

            
	
              PIRAEUS
      BANK A.E.

            	
              )

            
	
              in
      the presence of:

            	
              )

            

    

     

     

     

    

    
      
        
        

      

      
        57

      

      
        
        

      

    

    

    SK 25767 0001
913561kl07044_exhibit10-4.htm

    
      

    

     

    Exhibit 10.4

    

    

    

    

    

    

    

    

    

    

    Capital
Loan Agreement in Renminbi

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    China
Construction Bank

    Hunan
Branch

    

    

     

    

    

    

    
      
        
           

        

        
          1

          
            

          

        

        
           

        

      

    

    
 

    

    Contract
Number: 4306886432006002

    

    

    

    Loan
Category:  Fixed asset loan

    

    

    Borrower
(Party A):  Hunan Sanjiang Electric Power Co., Ltd.

    

    Address:
No. 001 South Power Station
Road                        
             Zip:
415300

       Chujiang Township,
Shimen County

    

    Legal
Representative ( Person in-Charge):   Hong Zhu

    

    Facsimile:
0736-7705511                                                                           Telephone:
0736-7703900

    

    
 

    

    

    

    

    

    

    Lender
(Party B): China Construction Bank Co., Ltd. Changde Branch

    

    Address:
130 Dongting
Avenue                                                             Zip:
415000

    

    Person
in-Charge: Xiaoping Meng

    

    Facsimile:                                                                                                   
Telephone: 7709217

    

    
 

    

    

    

    
      
        
           

        

        
          2

          
            

          

        

        
           

        

      

    

    

    Borrower
( hereinafter “Party A”):  Hunan Sanjiang Electric Power Co.,
Ltd

     

    Lender (
hereinafter  “Party B”):  China Construction Bank Co., Ltd.,
Changde Branch

     

    

     

    Party A
applies to Party B for borrowing money and Party B agrees to grant the
loan.  In accordance with the relevant laws, statutes and regulations,
the Parties enter into and abide by this contract upon
consultation.

     

           
Article 1. Amount
of the Loan

     

    Party A
borrows from Party B Renminbi (in capital) 20
million.

     

    Article
2. Purpose
of the Loan

     

    Party A
borrows the Loan for the purpose of power station technology
transformation and expansion.

     

    Article
3. Term
of the Loan

     

    Term of
the loan stipulated herein is five years, commencing from
July 31,
2006 to July 30,
2011.

     

    If the
starting date of the period of the loan hereunder is inconsistent with that
indicated in the indebtedness certificate, the date on the indebtedness
certificate for the first grant of the loan shall prevail.  The
indebtedness certificate is an integral part of this contract and has equal
legal effect with this contract.

     

    Article
4. Interest
Rate of the Loan, Penalty Rate, Calculation and Settlement of
Interest

     

    
      	
              1.  

            	
              Interest
      rate of the loan

            

    

     

    Interest
rate of the loan hereunder is monthly
(annual/monthly) interest rate of the second category of
the following:

     

    
      	
              (1)  

            	
              Fixed
      interest rate, namely,   BLANK_
      the interest rate will remain unchanged during the period of the
      loan;

            

    

     

    
      	
              (2)  

            	
              Floating
      interest rate, which is 0% upward
      (upward/downward) the base interest rate, shall be adjusted every 12 (twelve)
      months starting from the interest accrual date.  Interest
      adjustment day shall be the corresponding date to the interest accrual
      date in that month and shall be the last day of that month if there is no
      corresponding day.

            

    

     

    
      	
              2.  

            	
              Penalty
      rate

            

    

     

    
      	
              (1)  

            	
              The
      penalty rate is monthly
      (annual/monthly) rate;

            

    

     

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

     

    
      	
              (2)  

            	
              If
      Party A fails to use the loan according to the stipulated purpose, penalty
      rate shall be the second category
      of the following:

            

    

     

    
      	
              (i)  

            	
              Fixed
      interest rate, which is BLANK;

            

    

     

    
      	
              (ii)  

            	
              Floating
      interest rate, which is 100% upward the
      base interest rate, shall be adjusted every 12(twelve)
      months starting from the interest accrual date.  The penalty
      rate adjustment date shall be the corresponding date to the interest
      accrual date in that month and shall be the last day of that month if
      there is no corresponding date.

            

    

     

    
      	
              (3)  

            	
              Penalty
      rate for the overdue repayment of the loan hereunder shall be the second category
      of the following:

            

    

     

    
      	
              (i)  

            	
              Fixed
      interest rate, which is BLANK;

            

    

     

    
      	
              (ii)  

            	
              Floating
      interest rate, which is 50% upward the
      base interest rate, shall be adjusted every 12(twelve)
      months starting from the interest accrual date.  The penalty
      rate adjustment date shall be the corresponding date to the interest
      accrual date in that month and shall be the last day of that month if
      there is no corresponding date.

            

    

     

    
      	
              3.  

            	
              The
      accrual date under this agreement is the date the loan is first
      transferred into the account of Party
A

            

    

     

    The base
interest rate when the loan is first issued under this agreement is the loan
interest rate of the same grade promulgated by the People’s Bank of China on the
interest accrual day.  Thereafter, while adjusting the interest rate
or the penalty rate under this agreement, the base interest rate is the loan
interest rate of the same grade promulgated by the People’s Bank of China on the
adjusting day.  If the People’s Bank of China does not promulgate the
base interest rate of the same grade, the base interest rate shall be the
interest rate recognized by the banking industry or the common interest rate of
the same grade, subject to conditions otherwise agreed by the
parties.

     

    
      	
              4.  

            	
              Interest
      on the loan shall accrue from the date the loan is transferred into the
      account of Party A. Interest accrues upon the loan hereunder on a daily
      basis. Daily interest rate =monthly interest rate/30=annual interest
      rate/360. If Party A fails to pay the interest on schedule, compound
      interest shall accrue from the next
day.

            

    

     

    
      	
              5.  

            	
              Settlement
      of Interest

            

    

     

    
      	
              (1)  

            	
              In
      case of fixed interest rate applicable to this loan, the interest will be
      settled at the stipulated interest rate. In case of a floating interest
      rate, interest will be calculated at the interest rate applicable to each
      floating period. If there are several times of interest floating in a
      single interest settlement period, interest accrued in such interest
      settlement period shall be a total of respective interests in each
      floating period;

            

    

     

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

     

    
      	
              (2)  

            	
              Interest
      on the loan hereunder will be settled on a monthly basis
      (monthly/quarterly). Interest settlement day is fixed at the twentieth day
      of every month
      (month/end of quarter).

            

    

     

           Article 5. Grant
and Use of the Loan

     

    
      	
              1.  

            	
              Precedent
      Conditions of Grant of the Loan

            

    

     

    
      	
              (1)  

            	
              Unless
      wholly or partially waived by Party B, Party B shall be obliged to grant
      the loan only after the following precedent conditions are
      met:

            

    

     

    
      	
              (i)  

            	
              Party
      A has properly handled the approval, registration, delivery and other
      legal formalities relating to the loan hereunder in accordance with the
      relevant laws and regulations;

            

    

     

    
      	
              (ii)  

            	
              If
      there is security for this contract, the security contract or other
      security method conforming to the requirements of Party B has taken into
      effect;

            

    

     

    
      	
              (iii)  

            	
              Party
      A does not incur any event of default as stipulated
  herein;

            

    

     

    
      	
              (iv)  

            	
              Other
      precedent conditions as stipulated by the
  Parties:

            

    

     

                    The
following space is intentionally left
blank                                                  

     

                      _____________________________________________________________________

     

    
      	
              (2)  

            	
              Party
      B will commence with granting the loan within 5 bank business
      days after Party A has satisfied the above precedent
      conditions.

            

    

     

    
      	
              2.  

            	
              Use
      Plan of the Loan

            

    

     

    
      	
              (1)  

            	
              July 31, 2006,
      amount: 20
      million

            

    

     

             (the
following space is intentionally left blank)

     

    
      	
              (2)  

            	
              ____Year____Month___Day       Amount______

            

    

     

    
      	
              (3)  

            	
              ____Year____Month___Day       Amount______

            

    

     

    
      	
              (4)  

            	
              ____Year____Month___Day       Amount______

            

    

     

    
      	
              (5)  

            	
              ____Year____Month___Day       Amount______

            

    

     

    
      	
              (6)  

            	
              ____Year____Month___Day       Amount______

            

    

     

    

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

              
Article 6. Repayment

     

    
      	
              1.  

            	
              Principle
      of repayment

            

    

     

    Any
repayment by Party A hereunder shall be made based on the following
principles:

     

    
      	
              (1)  

            	
              Repayment
      of principal shall be prior to repayment of interest under the following
      situations: the principal of the loan has been overdue beyond 90 days,
      interest has been overdue beyond 90 days, Party A’s business operation or
      projects related to the Loan have been terminated though the loan has not
      become mature or the overdue has not been beyond 90 days, and other loans
      stipulated by the laws and
regulations.

            

    

     

    
      	
              (2)  

            	
              Except
      as situations otherwise listed in the Article 6 1 (1) above, any repayment
      shall be made based on the principle that repayment of interest shall be
      prior to repayment of principal, and the interest shall be paid off
      together with the principal upon the last installment of
      repayment.

            

    

     

    
      	
              2.  

            	
              Payment
      of interest

            

    

     

    Party A
shall pay Party B the interest due on interest settlement day. The first date
for     paying interest is the first interest
settlement day after the loan is granted. Upon the last installment of
repayment, the interest shall be paid off together with the
principal.

     

    
      	
              3.  

            	
              Plan
      of Repayment of Principal

            

    

     

    Party A
shall repay the principal of the Loan according to the following
plan:

     

    
      	
              (1)  

            	
              2009 Year 7  Month  31
      Day         Amount:
      5
      million;

            

    

     

    
      	
              (2)  

            	
              2010 Year 7  Month  31
      Day         Amount:
      5
      million;

            

    

     

    
      	
              (3)  

            	
              2011 Year 7  Month  30
      Day         Amount:
      10
      million;

            

    

     

           The
following space is intentionally left blank

     

    
      	
              (4)  

            	
              ____
      Year __
      Month  __  Day         Amount
      ________;

            

    

     

    
      	
              (5)  

            	
              ____
      Year __
      Month  __  Day         Amount
      ________;

            

    

     

    
      	
              (6)  

            	
              ____
      Year __
      Month  __  Day         Amount
      ________.

            

    

     

    
      	
              4.  

            	
              Method
      of repayment

            

    

     

    Party A
shall deposit sufficient funds in the account it has maintained with Party B
before the repayment date, which will be automatically used for repayment, or
transfer funds from other accounts for such repayment on the prescribed
repayment date. If Party A fails to made repayment on schedule, Party B shall be
entitled to transfer the corresponding money out of Party A’s account opened at
China Construction Bank Company Limited.

     

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

     

    
      	
              5.  

            	
              Early
      Repayment

            

    

     

    
      	
              (1)  

            	
              Party
      A only needs notifying Party B in advance for early repayment of
      interest;

            

    

     

    
      	
              (2)  

            	
              For
      early repayment of principal, Party A shall apply to Party B 20 bank
      business days in advance in writing and may early repay partial or all
      principal with the consent of Party
B.

            

    

     

    When
Party A early repays principal, interest will be calculated at the interest rate
of the loan as determined according to Article 4 hereof for the actual number of
days during which the loan is used.

     

    If Party
A repays principal early, it agrees to pay Party B compensation. Amount of the
compensation = early repaid principle × number of months of early
repayment  x ___    _
(ratio of compensation). In case the prepayment made within one month
before the maturity date, the number of months left before the maturity date of
the Loan shall be counted as one.

     

    If Party
A makes repayment in installments, in the event of early repayment of partial
principal of the loan, the repayment shall be made in the reversed order of the
repayment plan. Upon early repayment, the loan interest rate stipulated herein
shall still be applicable to the outstanding loan.

     

           
Article 7. Security
for the Loan

     

    If the
loan hereunder is a secured loan, the security method is the second of the
following:

     

    
      	
              1.  

            	
              Guarantee;

            

    

     

    
      	
              2.  

            	
              Mortgage;

            

    

     

    
      	
              3.  

            	
              Pledge;

            

    

     

    
      	
              4.  

            	
              Standby
      letter of credit;

            

    

     

    
      	
              5.  

            	
              Credit
      insurance.

            

    

     

    
      	
              6.  

            	
              Others:
      __BLANK__________________.

            

    

     

              
Article 8. Rights
and Obligations of Party A

     

    
      	
              1.  

            	
              Rights
      of Party A

            

    

     

    
      	
              (1)  

            	
              Requires
      Party B to grant the loan as stipulated
herein;

            

    

     

    
      	
              (2)  

            	
              Uses
      the loan for the purpose as stipulated
herein;

            

    

     

    
      	
              (3)  

            	
              Requests
      Party B to extend the Loan in accordance with the provisions set forth in
      this Agreement;

            

    

     

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

     

    
      	
              (4)  

            	
              Requires
      Party B to keep secret the relevant financial information and trade secret
      relating to production and operation provided by Party A, unless otherwise
      provided by laws, statutes and
regulations.

            

    

     

    
      	
              2.  

            	
              Obligations
      of Party A

            

    

     

    
      	
              (1)  

            	
              Party
      A shall provide the relevant financial accounting information and
      information on a monthly basis regarding its production and operation
      conditions, as required by Party B, including but not limited to providing
      the balance sheet and income statement (income and expenditure statement
      of public service unit) for the last quarter within the first 10 working days
      of the first month of each quarter, and providing the cash flow statement
      of each year by the end of such year, and shall be responsible for the
      trueness, completeness and validity of the information provided by
      it.

            

    

     

    
      	
              (2)  

            	
              Party
      A shall use the loan for the purpose set forth in this Agreement and do
      not misuse or appropriate the loan;

            

    

     

    
      	
              (3)  

            	
              Party
      A shall actively cooperate with Party B and voluntarily accept the
      inspection and supervision by Party B of its production, operation and
      financial activity and the use of the loan
  hereunder;

            

    

     

    
      	
              (4)  

            	
              Party
      A shall repay the principal and interest of the loan on
      schedule;

            

    

     

    
      	
              (5)  

            	
              Party
      A and its investors shall not withdraw capital or transfer assets to evade
      their debts owing to Party B;

            

    

     

    
      	
              (6)  

            	
              Before
      repaying in full the principal and interest of the loan owing to Party B,
      Party A shall not use the assets deriving from the loan hereunder to
      provide security to any third party without the consent of Party
      B;

            

    

     

    
      	
              (7)  

            	
              During
      the term of this agreement, if Party A provides security for the debts of
      other person, which may affect Party A’s ability of repayment hereunder,
      Party A shall notify and acquire the consent of Party B in
      advance;

            

    

     

    
      	
              (8)  

            	
              In
      the event the guarantor hereunder winds up, goes out of business, cancels
      the registration or its business license is revoked, becomes bankrupt, is
      dismissed or suffers operating loss or partially or completely loses the
      ability of security corresponding to the loan hereunder, or the value of
      the collateral hereunder is decreased or damaged or lost by accident,
      Party A shall timely provide other security acceptable to Party
      B;

            

    

     

    
      	
              (9)  

            	
              During
      the term of this contract, in the event of any change in the name, legal
      representative (responsible person), domicile, business scope, registered
      capital of Party A, Party A shall notify Party B in
  time;

            

    

     

    
      	
              (10)  

            	
              During
      the term of this contract, in the event of contracting, leasing,
      shareholding system rebuilding, pooling, consolidation, merger, division,
      establishing a joint venture, application for closing business for
      reorganization, application for dissolution, application for bankruptcy on
      the part of Party A, which is sufficient to affect the realization of
      Party B’s rights with respect to the loan, Party A shall notify in writing
      and acquire the written consent of Party B at least 30 (thirty)
      days in advance, and ensure the repayment and security hereunder as
      required by Party B;

            

    

     

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

     

    
      	
              (11)  

            	
              During
      the term of this contract, in the event of such conditions as ceasing to
      product, going out of business, canceling the registration or revocation
      of business license, involvement in illegal activity or material
      litigation of the legal representative or main responsible person, serious
      difficulty in production and operation, deterioration of financial
      condition on the part of Party A which may have material adverse influence
      upon the performance by Party A of its obligation of repayment hereunder,
      Party A shall immediately notify Party B in writing and ensure the
      repayment and security hereunder as required by Party
  B;

            

    

     

    
      	
              (12)  

            	
              Party
      A shall assume the expenses of legal service, insurance, appraisal,
      registration, custody, verification and notarization relating to this
      contract and the security
hereunder.

            

    

     

              
Article 9. Rights
and Obligations of Party B

     

    
      	
              1.  

            	
              Party
      B’s rights

            

    

     

    
      	
              (1)  

            	
              Party
      B has right to learn of the production, operation and financial activities
      of Party A and request Party A to provide such documents and materials as
      the relevant plans, statistics, financial statements and so
      on;

            

    

     

    
      	
              (2)  

            	
              Party
      B has right to deduct and transfer any amount in any currency from Party
      A’s account maintained with China Construction Bank Company Limited with
      respect to any amount payable by Party A to Party B based on this
      agreement;

            

    

     

    
      	
              2.  

            	
              Party
      B’s obligations

            

    

     

    
      	
              (1)  

            	
              Party
      B shall grant in full the loan on schedule as stipulated herein except the
      delay is caused by Party A;

            

    

     

    
      	
              (2)  

            	
              Party
      B shall keep secret the relevant financial information and trade secret
      relating to production and operation provided by Party A, unless otherwise
      provided by laws, statutes and
regulations.

            

    

     

              
Article 10. Liabilities
for Breach of Agreement

     

    
      	
              1.  

            	
              Breach
      of the agreement

            

    

     

    
      	
              (1)  

            	
              Breach
      by Party A

            

    

     

    

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    
      	
              (i)  

            	
              Fails
      to provide true, complete and valid financial information, information of
      production and operation condition and other relevant information as
      required by Party B;

            

    

     

    
      	
              (ii)  

            	
              Fails
      to use the loan for the purpose prescribed
  hereunder;

            

    

     

    
      	
              (iii)  

            	
              Fails
      to repay the principal and interest of the loan on
    schedule;

            

    

     

    
      	
              (iv)  

            	
              Rejects
      or prevents Party B from inspecting and supervising the use of the
      loan;

            

    

     

    
      	
              (v)  

            	
              Transfers
      assets and withdraws capital to evade the
debts;

            

    

     

    
      	
              (vi)  

            	
              Operation
      and financial condition deteriorates, Party A fails to discharge the debts
      due or Party A is or will be involved in material litigation or
      arbitration proceedings and other legal disputes, where Party B considers
      it may or has caused to an adverse effect or impair on the rights and
      interests of Party B hereunder;

            

    

     

    
      	
              (vii)  

            	
              Any
      other debt undertaken by Party A has affected or may affect the
      performance of Party A of its obligations
  hereunder;

            

    

     

    
      	
              (viii)  

            	
              Fails
      to perform other due indebtedness owing to Party
  B;

            

    

     

    
      	
              (ix)  

            	
              During
      the term of this Contract, Party A incurs changes in operation method or
      conversion of operational mechanism us as contracting, leasing,
      consolidation, merger, establishing a joint venture, division, pooling,
      shareholding system restructuring, where Party B considers it may or has
      caused to an adverse effect or impair on the rights and interests of Party
      B hereunder;

            

    

     

    
      	
              (x)  

            	
              Other
      condition which Party B considers sufficient to affect the exercise of
      Party B’s rights;

            

    

     

    
      	
              (xi)  

            	
              Breaches
      other obligations as stipulated
herein.

            

    

     

    
      	
              (2)  

            	
              If
      the guarantor is involved in the following circumstances and Party A fails
      to provide new security as required by Party B, it shall be deemed that
      Party A has breached this contract:

            

    

     

    
      	
              (i)  

            	
              The
      guarantor is involved in such circumstances as contracting, leasing,
      consolidation, merger, establishing a joint venture, division, pooling,
      shareholding system rebuilding, bankruptcy, cancellation which is
      sufficient to affect the guarantor’s capacity of undertaking the joint and
      several guarantee liability;

            

    

     

    
      	
              (ii)  

            	
              The
      guarantor provides any third party with security beyond its
      capacity;

            

    

     

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

     

    
      	
              (iii)  

            	
              The
      guarantor loses or may lose its ability of
  security;

            

    

     

    
      	
              (iv)  

            	
              Other
      breaches by the guarantor as stipulated in the guarantee
      contract.

            

    

     

    
      	
              (3)  

            	
              If
      the mortgagor is involved in the following circumstances and Party A fails
      to provide new security as required by Party B, it shall be deemed that
      Party A has breached this contract:

            

    

     

    
      	
              (i)  

            	
              The
      mortgagor fails to purchase insurance for the mortgaged property as
      required by Party B, or fails to dispose of the insurance compensation as
      stipulated in the mortgage contract after the occurrence of the insurance
      accident;

            

    

     

    
      	
              (ii)  

            	
              In
      the event of damage, loss, devaluation of the collateral caused by the
      behavior of any third party, the mortgagor fails to dispose of the damages
      as stipulated in the mortgage
contract;

            

    

     

    
      	
              (iii)  

            	
              The
      mortgagor donates, transfers, leases, re-mortgages, moves or otherwise
      disposes of the collateral without written consent of Party
    B;

            

    

     

    
      	
              (iv)  

            	
              The
      mortgagor disposes of the collateral with the consent of Party B but fails
      to dispose of the proceeds therefrom as stipulated in the mortgage
      contract;

            

    

     

    
      	
              (v)  

            	
              In
      the event of the damage, loss or devaluation of collateral which is
      sufficient to affect discharging of the debts hereunder, the mortgagor
      fails to reinstate the value of collateral or provide other security as
      acceptable by Party B;

            

    

     

    
      	
              (vi)  

            	
              Other
      breaches by the mortgagor as stipulated in the mortgage
      contract.

            

    

     

    
      	
              (4)  

            	
              If
      the pledgor is involved in the following circumstances and Party A fails
      to provide new security as required by Party B, it shall be deemed that
      Party A has breached this contract:

            

    

     

    
      	
              (i)  

            	
              The
      pledgor fails to purchase insurance for the pledged property as required
      by Party B, or fails to dispose of the insurance compensation as
      stipulated in the pledge contract after the occurrence of the insurance
      accident;

            

    

     

    
      	
              (ii)  

            	
              In
      the event of damage, loss, devaluation of pledged property caused by the
      behavior of any third party, the pledgor fails to dispose of the damages
      as stipulated in the pledge
contract;

            

    

     

    
      	
              (iii)  

            	
              The
      pledgor disposes of the pledged property with the consent of Party B but
      fails to dispose of the proceeds therefrom as stipulated in the pledge
      contract;

            

    

     

    
      	
              (iv)  

            	
              In
      the event of the damage, loss or devaluation of pledged property which is
      sufficient to affect the repayment of the principal and interest, the
      pledgor fails to reinstate the value of pledged property or provide other
      security acceptable to Party B;

            

    

     

     

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    
      	
              (v)  

            	
              Other
      breaches by the pledgor as stipulated in the pledge
    contract.

            

    

     

    
      	
              (5)  

            	
              In
      the event the security contract or other security does not take effect, is
      valid or rescinded, or the guarantor is involved in other circumstances of
      partially or completely losing the ability of guarantee or rejects to
      performance the obligations of security, and Party A fails to provide new
      security as required by Party B, it shall be deemed that Party A has
      breached this contract.

            

    

     

    
      	
              2.  

            	
              Remedies
      for Breaches of Agreement

            

    

     

    In the
event of the breaches in above Article 10, 1 (1) to 1(5), Party B shall be
entitled to exercise one or more of the following rights:

     

    
      	
              (1)  

            	
              Stop
      granting the loan, accelerate the maturity immediately and require Party A
      to promptly repay the principal, interest and expenses of all the mature
      or immature debts hereunder;

            

    

     

    
      	
              (2)  

            	
              Charge
      liquidated damages against Party A at            ‰
      of the principal of the loan;

            

    

     

    
      	
              (3)  

            	
              In
      the event Party A fails to use the loan for the purpose as stipulated
      herein, interest and compound interest shall accrue at penalty rate
      according to the interest settlement method hereunder from the date of
      violation to the date on which the principal and interest are repaid in
      full;

            

    

     

    
      	
              (4)  

            	
              Before
      maturity date, compound interest will be calculated and payable upon the
      interest not repaid by Party A on schedule according to the rate and
      settlement method as stipulated in Article 4
  hereof.

            

    

     

    
      	
              (5)  

            	
              For
      the overdue repayment, interest and compound interest shall accrue on the
      repayment in arrears and any principal and interest wholly or partially
      declared early maturity by Party B, pursuant to the penalty rate and
      interest settlement method stipulated in this agreement, for a period
      commencing from the overdue date to the date when the principal and
      interest are repaid in full. Delay in the repayment of the loan means
      Party A fails to satisfy the loan on schedule or repays the loan exceeding
      the prescribed installments;

            

    

     

    
      	
              (6)  

            	
              Transfer
      any amount in any currency out of Party A's account opened in China
      Construction Bank;

            

    

     

    
      	
              (7)  

            	
              Request
      Party A to provide new security at the requirements of Party B for all the
      debts hereunder;

            

    

     

    
      	
              (8)  

            	
              Exercise
      security rights;

            

    

     

    
      	
              (9)  

            	
              Rescind
      this agreement.

            

    

     

     

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

              
Article 11. Other
Matters agreed

     

    
      	
              1.  

            	
              The
      following space is intentionally left
  blank_____________;

            

    

     

    
      	
              2.  

            	
              __________________________________________________;

            

    

     

    
      	
              3.  

            	
              __________________________________________________;

            

    

     

    
      	
              4.  

            	
              __________________________________________________;

            

    

     

                
Article 12. Dispute
Settlement

     

    Any
dispute arising during the performance of this agreement may be settled through
consultation. If the consultation fails, it shall be settled through the first of the
following methods:

     

    
      	
              1.  

            	
               Bring
      a suit before the court in the jurisdiction where Party B
      domiciles;

            

    

     

    
      	
              2.  

            	
              File
      the dispute to   blank_
      arbitration commission for arbitration (Arbitration place is   blank  
      ) in accordance with the effective arbitration rules of the
      arbitration commission at the time of applying for arbitration.
      Arbitration award is will be final and bind the
  Parties.

            

    

     

    During
the suit or arbitration, the provisions in this agreement which are not in
dispute shall still be performed.

     

              
Article 13. Effectiveness
of the Agreement

     

    This
agreement will take into effect upon execution of the legal representatives
(persons in-charge) or authorized representatives of the parties, affixed with
the official seals of both parties.

     

              
Article 14. There
are 4 (four)
duplicate copies of this agreement.

     

              
Article 15. Representations

     

    
      	
              1.  

            	
              Party
      A is clearly aware of the business scope and authority of Party
      B;

            

    

     

    
      	
              2.  

            	
              Party
      A has read all the terms and conditions of this Agreement. Party B has
      made the corresponding interpretation of the terms and conditions of this
      Agreement as requested by Party A. Party A has fully learned and
      understood the meaning and the corresponding legal consequence of the
      terms and conditions of this
Agreement;

            

    

     

    
      	
              3.  

            	
              Party
      A has right to enter into this
Agreement.

            

    

     

     

    

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    
 

     

     Party
A (Seal): (Seal)

     

     Legal
representative (person in-charge) or authorized representative
(Signature):

     

                                                                                                                                   /s/
Zhengxi Wang

     

                                                                                                                                   July
31, 2006

     

     

    Party B
(Seal): (Seal)

     

    Person
in-charge or authorized representative (Signature):

     

                                                                                                                  
/s/ Baining Li

     

                                               July 31, 2006

     

     

     

    
 

     

    14

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