Document:

Exhibit 10.37

 

 

Private &
Confidential

 

 

Supplemental Agreement

 

 

 

 

 

 

Dated 13th June 2007

 

SUPPLEMENTAL AGREEMENT

 

relating to inter alia a loan of up to €
13,300,000

to

 

 

OCEAN DYNAMIC CORP.

 

-and-

 

SEA GLOBAL S.A.

 

as joint and several Borrowers

 

 

provided by

 

 

HSH NORDBANK AG

 

-and-

 

AEGEAN BALTIC BANK S.A.

as Banks

 

 

 

-and-

HSH NORDBANK AG

as L/C Bank

 

 

 

-and-

AEGEAN BALTIC BANK S.A.

as Arranger, Agent and Security Trustee

 

 

 

V&P

Law Firm

 

 

THIS
SUPPLEMENTAL AGREEMENT is dated 13th June 2007 and made

BY AND
AMONG:

(1)                                  OCEAN
DYNAMIC CORP. a corporation organised and existing under the laws
of the Republic of the Marshall Islands, having its registered office at Trust
Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Republic of the
Marshall Islands (the “Borrower A”);

(2)                                  SEA
GLOBAL S.A., a corporation organised and existing under the
laws of the Republic of the Marshall Islands, having its registered office at
Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Republic of the
Marshall Islands (the “Borrower B” and
together with the Borrower A the “Borrowers”);

(3)                                  AEGEAN
BALTIC BANK S.A., a company incorporated under the laws of Greece
having its registered office at 28 Diligianni Street, 145 62 Kifissia, Greece
in its capacity as arranger (the “Arranger”);

(4)                                  AEGEAN
BALTIC BANK S.A., a company incorporated under the laws of Greece
having its registered office at 28 Diligianni Street, 145 62 Kifissia, Greece
In its capacity as agent for the Banks and the L/C Bank (the “Agent”);

(5)                                  AEGEAN
BALTIC BANK S.A., a company incorporated under the laws of Greece
having its registered office at 28 Diligianni Street, 145 62 Kifissia, Greece
in its capacity as security agent and trustee for and on behalf of the Agent,
the Banks and the L/C Bank (the “Security Trustee”);

(6)                                  THE
BANKS AND FINANCIAL INSTITUTIONS whose names and addresses
are set out in schedule I as lenders (the “Banks”);

(7)                                  HSH
NORDBANK AG, a company organised and existing under the laws of
the Republic of Germany, having its registered office at
Gerhart-Hauptmann-Platz 50, 20095 Hamburg, Germany, in its capacity as letters
of credit Issuing bank (the “L/C Bank” and
together with the Agent, the Arranger, the Security Trustee and the Banks
hereinafter called the “Creditor Parties”);

(8)                                  AEGEAN
BUNKERING SERVICES INC., a corporation incorporated under the laws
of the Republic of the Marshall Islands having its registered office at Trust
Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands
MH96960 in its capacity as manager and corporate guarantor (the “Manager”);

(9)                                  AEGEAN
MARINE PETROLEUM S.A., a corporation incorporated under the laws
of the Republic of Liberia having its registered office at 80 Broad Street,
Monrovia, Republic of Liberia in its capacity as corporate guarantor (the “AEGEAN PETROLEUM” and together with the Manager the “Existing Corporate Guarantors”);

(10)                            MR DIMITRIOS
MELISANIDIS of 4, Hydras and Simla Street, Aixoni, Glyfada,
Attiki (the “Personal Guarantor”);

(11)                            AEGEAN MARINE PETROLEUM NETWORK INC., a corporation incorporated
under the laws of the Republic of the Marshall Islands having its registered
office at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro,
Marshall Islands MH96960 (the “AEGEAN PETROLEUM NETWORK”);
and

(12)                            AEGEAN
SHIPHOLDINGS INC., a corporation incorporated under the laws of the
Republic of the Marshall Islands having its registered office at Trust Company
Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH96960 (the “AEGEAN SHIPHOLDINGS” and, together with the AEGEAN PETROLEUM
NETWORK, the “New Corporate Guarantors”).

 

 

WHEREAS:

(A)                              this agreement
is supplemental to a financial agreement dated 26 October 2005 (the “Principal Agreement”) made by and among (1) the Borrowers,
(2) the Arranger, (3) the Agent, (4) the Security Trustee (5) the Banks and (6)
the L/C Bank, relating to a loan facility of up to Thirteen million three
hundred thousand Euro (€13,300,000) made or (as the context may require) to be
made available by the Banks to the Borrowers, jointly and severally, of which
the principal amount outstanding at the date hereof is Ten million Two hundred
fifty two thousand and five hundred Euros (€10,252,500), to be used for the
purposes of, inter alia, financing and/or, as the case may be, refinancing part
of the construction and acquisition cost of the Vessels;

(B)                                by a letter of
credit facility agreement dated 26th October 2005 (hereinafter as
the same may from time to time be amended, supplemented or varied called the “L/C Facility Agreement”) made by and among the L/C Bank as
letters of credit issuing bank and the Borrowers as joint and several obligors,
the L/C Bank has made available to the Borrowers a letter of credit facility in
an aggregate amount not exceeding Twelve million Three hundred Three thousand
Euros (€12,303,000) for the purpose of issuance of up to two (2) stand by
letters of credit, under the terms and conditions therein stated;

(C)                                this agreement
sets out the terms and conditions upon which the Creditor Parties shall, at the
request of the Borrowers, provide their consent to:

(i)                                     the release of
the Personal Guarantee;

(ii)                                  the release of
the Borrowers’ obligations to pay moneys to the credit of the Retention Account
pursuant to clause 21 of the Principal Agreement;

(iii)                               the execution
of corporate guarantees by the New Corporate Guarantors in favour of the
Security Trustee, each as security for the obligations of the Borrowers under
the Financial Agreement and the L/C Facility Agreement; and

(iv)                              certain other
amendments to the Principal Agreement.

NOW IT
IS HEREBY AGREED as follows:

1                                         Definitions

1.1                               Defined expressions

Words
and expressions defined in the Principal Agreement shall, unless the context
otherwise requires or unless otherwise defined herein, have the same meanings
when used in this Agreement.

1.2                               Definitions

In
this Agreement, unless the context otherwise requires:

“AEGEAN PETROLEUM NETWORK Guarantee” means the guarantee and
indemnity executed or (as the context may require) to be executed by the AEGEAN
PETROLEUM NETWORK in favour of the Security Trustee in the form set out in
schedule 4;

“AEGEAN SHIPHOLDINGS Guarantee” means the guarantee and
indemnity executed or (as the context may require) to be executed by AEGEAN
SHIPHOLDINGS in favour of the Security Trustee in the form set out in schedule
5;

“Effective Date” means the date, being no later than 15th
June 2007, on which the Agent notifies the Borrowers in writing that the Agent
has received the documents and evidence specified in clause 5 and schedule 2 in
a form and substance satisfactory to it;

 

 

“Existing Corporate Guarantees” means the guarantees and
indemnities, both dated 29th November 2005 executed by each Existing
Corporate Guarantor in favour of the Security Trustee in respect of the
obligations of the Borrowers under the Principal Agreement and the L/C Facility
Agreement;

“Financial Agreement” means the Principal Agreement as
amended and restated by this Agreement;

“New Corporate Guarantees” means, together, the AEGEAN
PETROLEUM NETWORK Guarantee and the AEGEAN SHIPHOLDINGS Guarantee and “New Corporate Guarantee” means either of them;

“Personal Guarantee” means the guarantee dated 29th
November 2005 executed by the Personal Guarantor in favour of the Agent, the
Security Trustee, the Banks and the L/C Bank in respect of the obligations of
the Borrowers under the Principal Agreement and the L/C Facility Agreement;

“Relevant Documents” means this Agreement and the New
Corporate Guarantees; and

“Relevant Parties” means, together, the Borrowers, the Existing
Corporate Guarantors, the Personal Guarantor, the Manager and the New Corporate
Guarantors or, where the context so requires or permits, means any or all of
them.

1.3                               Principal Agreement

References
in the Principal Agreement to “this Agreement”
shall, with effect from the Effective Date and unless the context otherwise
requires, be references to the Principal Agreement as amended and restated by
this Agreement and words such as “herein”, “hereof”, “hereunder”, “hereafter”, “hereby” and “hereto”, where they appear in the Principal Agreement, shall
be construed accordingly.

1.4                               Headings

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

1.5                               Construction of certain terms

Clause
1.4 of the Principal Agreement shall apply to this Agreement (mutatis mutandis) as if setout herein and
as if references therein to “this Agreement” were references to this Agreement.

2                                         Consent
of the Creditor Parties

2.1                               Consent

The
Creditor Parties, relying upon the representations and warranties on the part
of the Borrowers contained in clause 4, agree with the Borrowers that subject
to the terms and conditions of this Agreement and in particular, but without
prejudice to the generality of the foregoing, fulfilment on or before 15th
June 2007 of the conditions contained in clause 5 and schedule 2, the Creditor
Parties agree to the amendments of the Principal Agreement on the terms set out
in clause 3.

2.2                               Release of Personal Guarantee

The
Creditor Parties hereby agree that, subject to the terms and conditions of this
Agreement and in particular, but without prejudice to the generality of the
foregoing, satisfaction of the conditions contained in clause 5 and schedule 2,
they release the Personal Guarantor from its obligations under the Personal
Guarantee.

 

 

3                                         Amendments
to Principal Agreement

3.1                               Amendments to Principal Agreement

The
Principal Agreement shall, with effect on and from the Effective Date, be (and
it is hereby) amended in accordance with the form of the amended and restated
Financial Agreement set out in schedule 3 and (as so amended) will continue to
be binding upon the Creditor Parties and the Borrowers upon such terms as so
amended and restated.

3.2                               Continued force and effect

Save
as amended and restated by this Agreement, the provisions of the Principal
Agreement shall continue in full force and effect and the Principal Agreement
and this Agreement shall be read and construed as one instrument.

4                                         Representations
and warranties

4.1                               Primary representations and warranties

Each
of the Relevant Parties represents and warrants to the Creditor Parties that:

4.1.1                                                Existing
representations and warranties

the
representations and warranties set out in clause 14 of the Principal Agreement
and clause 3 of each Existing Corporate Guarantee were true and correct on the
date of the Principal Agreement and each Existing Corporate Guarantee,
respectively, and are true and correct, including to the extent that they may
have been or shall be amended by this Agreement, as if made at the date of this
Agreement with reference to the facts and circumstances existing at such date;

4.1.2                                                Corporate
power

each
of the Relevant Parties has power to execute, deliver and perform its
obligations under the Relevant Documents to which it is or is to be a party;
all necessary corporate, shareholder and other action has been taken by each of
the Relevant Parties to authorise the execution, delivery and performance of
the Relevant Documents to which it is or is to be a party;

4.1.3                                                Binding
obligations

the
Relevant Documents to which it is or is to be a party constitute valid and
legally binding obligations of each of the Relevant Parties enforceable in
accordance with their terms;

4.1.4                                                No
conflict with other obligations

the
execution, delivery and performance of the Relevant Documents to which it is or
is to be a party by each of the Relevant Parties will not (i) contravene any
existing law, statute, rule or regulation or any judgment, decree or permit to
which any of the Relevant Parties is subject, (ii) conflict with, or result in
any breach of any of the terms of, or constitute a default under, any agreement
or other instrument to which any of the Relevant Parties is a party or is
subject or by which it or any of its property is bound, (iii) contravene or
conflict with any provision of the constitutional documents of any of the
Relevant Parties or (iv) result in the creation or imposition of or oblige any
of the Relevant Parties to create any Encumbrance (other than a Permitted
Encumbrance) on any of the undertaking, assets, rights or revenues of any of
the Relevant Parties;

4.1.5                                                No
filings required

 

 

it
is not necessary to ensure the legality, validity, enforceability or
admissibility in evidence of any of the Relevant Documents that they or any
other instrument be notarised, filed, recorded, registered or enrolled in any
court, public office or elsewhere in any Relevant Jurisdiction or that any
stamp, registration or similar tax or charge be paid in any Relevant
Jurisdiction on or in relation to the Relevant Documents and each of the
Relevant Documents is in proper form for its enforcement in the courts of each
Relevant Jurisdiction;

4.1.6                                                Choice
of law

the
choice of English law to govern the Relevant Documents and the submissions by
the Relevant Parties to the non-exclusive jurisdiction of the English courts
are valid and binding; and

4.1.7                                                Consents
obtained

every
consent, authorisation, licence or approval of, or registration or declaration
to, governmental or public bodies or authorities or courts required by any of
the Relevant Parties in connection with the execution, delivery, validity,
enforceability or admissibility in evidence of the Relevant Documents to which
it Is or will become a party or the performance by any of the Relevant Parties
of their respective obligations under such documents has been obtained or made
and is in full force and effect and there has been no default in the observance
of any conditions or restrictions (if any) imposed in, or in connection with,
any of the same.

4.2                               Repetition of representations and warranties

Each
of the representations and warranties contained in clause 4.1 of this
Agreement, clause 14 of the form of the amended and restated Financial
Agreement set out in schedule 3, clause 3 of each Existing Corporate Guarantee
and clause 3 of each of the New Corporate Guarantees shall be deemed to be
repeated by the relevant Relevant Parties on the Effective Date as if made with
reference to the facts and circumstances existing on such day.

5                                         Conditions

5.1                               Documents and evidence

The
consents and agreements of the Creditor Parties referred to in clause 2 shall
be subject to the receipt by the Agent or as duly authorised representative on
or before the Effective Date of the documents and evidence specified in
schedule 2 in form and substance satisfactory to the Agent.

5.2                               General conditions precedent

The
consents and agreements of the Creditor Parties referred to in clause 2 shall
be further subject to:

5.2.1                                                the
representations and warranties in clause 4 being true and correct on the
Effective Date as if each was made with respect to the facts and circumstances
existing at such time; and

5.2.2                                                no
Default having occurred and continuing at the time of the Effective Date.

5.3                               Waiver of conditions precedent

The
conditions specified in this clause 5 are inserted solely for the benefit of
the Creditor Parties and may be waived by the Agent (acting on the instructions
of the Majority Banks) in whole or in part with or without conditions.

 

 

6                                         Relevant
Parties’ confirmation

Each
of the Relevant Parties hereby confirms its consent to the amendments to the
Principal Agreement as set out in clause 3 and to the release of the Personal
Guarantee and agrees that:

6.1                               each
of the Finance Documents to which it is a party, and its obligations
thereunder, shall remain and continue in full force and effect notwithstanding
the amendments to the Principal Agreement and the other Finance Documents
contained in this Agreement and the release of the Personal Guarantee; and

6.2                               with
effect from the Effective Date references to (i) “the Agreement” or “the
Financial Agreement” in any of the other Finance Documents to which it is a
party shall henceforth be references to the Principal Agreement as amended by this
Agreement and as from time to time hereafter amended and shall also be deemed
to Include this Agreement and the obligations of the Borrowers hereunder and
(ii) references in any of the Finance Documents to any other Finance Document
to which it is a party shall henceforth be reference to that Finance Document
as amended by this Agreement and as from time to time hereafter amended.

7                                         Expenses

7.1                               Expenses

The
Borrowers agree to pay to the Agent on a full indemnity basis on demand all
expenses (including legal and out-of-pocket expenses) incurred by the Creditor
Parties or any of them:

7.1.1                                                in
connection with the negotiation, preparation, execution and, where relevant,
registration of this Agreement, the other Relevant Documents or any of them and
any discharge or release documents required to be executed by the Creditor
Parties or any of them pursuant to clause 2.2 and of any amendment or extension
of or the granting of any waiver or consent under this Agreement, the other
Relevant Documents or any of them or any such discharge or release documents;
and

7.1.2                                                in
contemplation of, or otherwise in connection with, the enforcement of, or
preservation of any rights under this Agreement or the other Relevant Documents
or otherwise in respect of the monies owing and obligations incurred under this
Agreement and the other Relevant Documents,

together
with interest at the rate referred to in clause 123 of the Principal Agreement
from the date on which such expenses were incurred to the date of payment (as
well after as before judgment).

7.2                               Value Added Tax

All
fees and expenses payable pursuant to this clause 7 shall be paid together with
value added tax or any similar tax (if any) property chargeable thereon.

7.3                               Stamp and other duties

The
Borrowers agree to pay to the Agent on demand all stamp, documentary,
registration or other like duties or taxes (including any duties or taxes
payable by the Creditor Parties or any of them) imposed on or in connection
with this Agreement or the other Relevant Documents or any of them and shall
indemnify the Creditor Parties or any of them against any liability arising by
reason of any delay or omission by the Borrowers to pay such duties or taxes.

8                                         Miscellaneous
and notices

8.1                               Notices

 

 

The
provisions of clause 34 of the Financial Agreement shall extend and apply to
the giving or making of notices or demands hereunder as if the same were
expressly stated herein.

8.2                               Counterparts

This
Agreement may be executed in any number of counterparts and by the different
parties on separate counterparts, each of which when so executed and delivered
shall be an original but all counterparts shall together constitute one and the
same instrument.

8.3                               Borrowers’ obligations

Notwithstanding
anything to the contrary contained in this Agreement, the agreements,
obligations and liabilities of the Borrowers herein contained are joint and
several and shall be construed accordingly. Each of the Borrowers agrees and
consents to be bound by this Agreement notwithstanding that the other Borrower
which was intended to sign or be bound may not do so or be effectually bound
and notwithstanding that this Agreement may be invalid or unenforceable against
the other Borrower whether or not the deficiency is known to the Creditor
Parties or any of them. The Creditor Parties shall be at liberty to release any
of the Borrowers from this Agreement and to compound with or otherwise vary the
liability or to grant time and indulgence to make other arrangements with any
of the Borrowers without prejudicing or affecting the rights and remedies of
the Creditor Parties or any of them against the other Borrower.

9                                         Applicable
law

9.1                               Law

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

9.2                               Submission to jurisdiction

Each
Relevant Party agrees, for the benefit of the Creditor Parties, that any legal
action or proceedings arising out of or in connection with this Agreement
against such Relevant Party or any of its assets may be brought in the English
courts. Each Relevant Party irrevocably and unconditionally submits to the
jurisdiction of such courts and irrevocably designates, appoints and empowers
Riches Consulting at present of Oki Jarretts Farmhouse, Brantridge Lane,
Balcombe, West Sussex RH17 6JR, England to receive for it and on its behalf,
service of process issued out of the English courts in any such legal action or
proceedings. The submission to such jurisdiction shall not (and shall not be
construed so as to) limit the right of the Creditor Parties or any of them to
take proceedings against the Relevant Parties or any of them in the courts of
any other competent jurisdiction nor shall the taking of proceedings in any one
or more jurisdictions preclude the taking of proceedings in any other
jurisdiction, whether concurrently or not. The parties further agree that only
the Courts of England and not those of any other State shall have jurisdiction
to determine any claim which the Relevant Parties or any of them may have
against the Creditor Parties or any of them arising out of or in connection
with this Agreement.

9.3                               Contracts (Rights of Third Parties) Act 1999

No
term of this Agreement is enforceable under the Contracts (Rights of Third
Parties) Act 1999 by a person who is not a party to this Agreement.

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

 

	
  EXECUTED as a DEED

  	
   

  	
   

  
	
  by YPAPANTI KOUMBIADOU

  	
   

  	
   

  
	
  for and on behalf of

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  OCEAN DYNAMIC CORP.

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ YPAPANTI KOUMBIADOU

  
	
  in the presence of:

  	
   

  	
  Attorney-in-fact

  
	
  /s/ AIKATERNINI KOKKINIDOU

  	
   

  	
   

  
	
  AIKATERINI KOKKINIDOU

  	
   

  	
   

  
	
  Attorney-at-law

  V&P Law Firm

  15,Filikis Eterias Square

  106 73, Athens - Greece

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  EXECUTED as a DEED

  	
   

  	
   

  
	
  by YPAPANTI KOUMBIADOU

  	
   

  	
   

  
	
  for and on behalf of

  	
   

  	
   

  
	
  SEA GLOBAL S.A.

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ YPAPANTI KOUMBIADOU

  
	
  in the presence of:

  	
   

  	
  Attorney-in-fact

  
	
   

  	
   

  	
   

  
	
  /s/ AIKATERNINI KOKKINIDOU

  	
   

  	
   

  
	
  AIKATERINI KOKKINIDOU

  	
   

  	
   

  
	
  Attorney-at-law

  V&P Law Firm

  15,Filikis Eterias Square

  106 73, Athens - Greece

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  EXECUTED as a DEED

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ Philippos E. TSAMANIS

  
	
  by

  	
   

  	
  Authorised Signatory

  
	
  and by

  	
   

  	
   

  
	
  for and on behalf of

  	
   

  	
   

  
	
  AEGEAN BALTIC BANK S.A.

  	
   

  	
  /s/ PANAGIOTIS P.
  NIKITARAKOS

  
	
   

  	
   

  	
  Authorised Signatory

  
	
  as Arranger, Agent,
  Security

  	
   

  	
   

  
	
  Trustee and Bank

  	
   

  	
   

  
	
  in the presence of:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ AIKATERNINI KOKKINIDOU

  	
   

  	
   

  
	
  AIKATERINI KOKKINIDOU

  	
   

  	
   

  
	
  Attorney-at-law

  V&P Law Firm

  15,Filikis Eterias Square

  106 73, Athens - Greece

  	
   

  	
   

  

 

 

 

	
  EXECUTED as a DEED

  	
   

  	
   

  
	
  by AIKATERINI KOKKINIDOU

  	
   

  	
   

  
	
  for and on behalf of

  	
   

  	
   

  
	
  HSH NORDBANK AG

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ AIKATERINI KOKKINIDOU

  
	
  As L/C Bank and Bank

  	
   

  	
  Attorney-in-fact

  
	
  in the presence of:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ ANNA SACHLI

  	
   

  	
   

  
	
  ANNA SACHLI

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  EXECUTED as a DEED

  	
   

  	
   

  
	
  by YPAPANTI KOUMBIADOU

  	
   

  	
   

  
	
  for and on behalf of

  	
   

  	
   

  
	
  AEGEAN BUNKERING SERVICES INC.

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ YPAPANTI KOUMBIADOU

  
	
  as Existing Corporate
  Guarantor and Manager

  	
   

  	
  Attorney-in-fact

  
	
  in the presence of:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ AIKATERINI KOKKINIDOU

  	
   

  	
   

  
	
  AIKATERINI KOKKINIDOU

  	
   

  	
   

  
	
  Attorney-at-law

  V&P Law Firm

  15,Filikis Eterias Square

  106 73, Athens - Greece

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  EXECUTED as a DEED

  	
   

  	
   

  
	
  by YPAPANTI KOUMBIADOU

  	
   

  	
   

  
	
  for and on behalf of

  	
   

  	
   

  
	
  AEGEAN MARINE PETROLEUM S.A.

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ YPAPANTI KOUMBIADOU

  
	
  as Existing Corporate
  Guarantor

  	
   

  	
  Attorney-in-fact

  
	
  in the presence of:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ AIKATERINI KOKKINIDOU

  	
   

  	
   

  
	
  AIKATERINI KOKKINIDOU

  	
   

  	
   

  
	
  Attorney-at-law

  V&P Law Firm

  15,Filikis Eterias Square

  106 73, Athens - Greece

  	
   

  	
   

  

 

 

	
  EXECUTED as a DEED

  	
   

  	
   

  
	
  by MR
  DIMITRIOS MELISANDIS

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ MR DIMITRIOS
  MELISANIDIS

  
	
  in the presence of :

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ AIKATERINI KOKKINIDOU

  	
   

  	
   

  
	
  AIKATERINI KOKKINIDOU

  	
   

  	
   

  
	
  Attorney-at-law

  V&P Law Firm

  15,Filikis Eterias Square

  106 73, Athens - Greece

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  EXECUTED as a DEED

  	
   

  	
   

  
	
  by YPAPANTI KOUMBIADOU

  	
   

  	
   

  
	
  for and on behalf of

  	
   

  	
   

  
	
  AEGEAN MARINE PETROLEUM NETWORK
  INC.

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ YPAPANTI KOUMBIADOU

  
	
  in the presence of:

  	
   

  	
  Attorney-in-fact

  
	
   

  	
   

  	
   

  
	
  /s/ AIKATERINI KOKKINIDOU

  	
   

  	
   

  
	
  AIKATERINI KOKKINIDOU

  	
   

  	
   

  
	
  Attorney-at-law

  V&P Law Firm

  15,Filikis Eterias Square

  106 73, Athens - Greece

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  EXECUTED as a DEED

  	
   

  	
   

  
	
  by YPAPANTI KOUMBIADOU

  	
   

  	
   

  
	
  for and on behalf of

  	
   

  	
   

  
	
  AEGEAN SHIPHOLDINGS INC.

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ YPAPANTI KOUMBIADOU

  
	
  in the presence of:

  	
   

  	
  Attorney-in-fact

  
	
   

  	
   

  	
   

  
	
  /s/ AIKATERINI KOKKINIDOU

  	
   

  	
   

  
	
  AIKATERINI KOKKINIDOU

  	
   

  	
   

  
	
  Attorney-at-law

  V&P Law Firm

  15,Filikis Eterias Square

  106 73, Athens - Greece

  	
   

  	
   

  

 

Date 26 October 2005

 

 

 

OCEAN DYNAMIC CORP.

 

 

-and-

SEA GLOBAL S.A.

as joint and several Borrowers

 

 

 

THE BANKS AND FINANCIAL INSTITUTIONS

listed in Schedule 1

as Banks

-and-

 

 

 

HSH NORDBANK AG

as L/C Bank

 

 

 

-and-

 

 

 

AEGEAN BALTIC BANK S.A.

as Arranger, Agent and Security Trustee

 

 

 

FINANCIAL AGREEMENT

 

relating to a certain long-term loan facility

of up to €13,300,000 to finance the acquisition

of two newbuilding double hull product

tanker vessels with roro facility

 

 

 

 

 

 

V&P

LAW FIRM

 

THIS AGREEMENT is made on the 26th
day of October 2005 as amended and restated by a Supplemental Agreement dated
13th June 2007:

BETWEEN

1.                                     (a)           OCEAN DYNAMIC CORP.
a corporation organised and existing under the laws of the Republic of the
Marshall Islands, having its registered office at Trust Company Complex,
Ajeltake Road, Ajeltake Island, Majuro MH96960, Republic of the Marshall
Islands (the “Borrower A”); and

(b)                                  SEA GLOBAL S.A., a corporation organised and existing under
the laws of the Republic of the Marshall Islands, having its registered office
at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro MH96960,
Republic of the Marshall Islands (the “Borrower B” and
together with the Borrower A the “Borrowers”) as
joint and several borrowers.

2.                                      THE
BANKS listed in Schedule 1 as Banks; and

3.                                      HSH
NORDBANK AG, acting through its office at Gerhart-Hauptmann-Platz 50,
20095, Hamburg, the Federal Republic of Germany as L/C Bank;
and

4.                                      AEGEAN
BALTIC BANK SA, acting through its office at 28 Diligianni Street, 145 62
Kifissia, Greece as Arranger, Agent
and Security Trustee.

WHEREAS

A.                                    The
Borrowers have requested the Banks to make available to the Borrowers a certain
term loan facility not exceeding in aggregate Thirteen million Three hundred
thousand Euros (€13,300,000) for the purposes set forth in Clause 2.2.

B.                                    The
Borrowers and the L/C Bank have agreed to enter into a letter of credit
facility agreement pursuant to which the L/C Bank shall agree to Issue certain
letters of credit at the request of each Borrower.

C.                                    The
Banks and the L/C Bank have agreed to share in the manner herein provided in
the security to be granted to the Security Trustee, the other Creditor Parties
or any of them pursuant to this Agreement.

Now it is hereby agreed as follows:

1                                         PURPOSE AND
DEFINITIONS

1.1                               In this Agreement the following
terms shall have the following meanings unless the context otherwise requires:

“Accounts” means collectively the
Earnings Accounts and the Cash Collateral Account and, in the singular, means
any of them;

“Additional Construction Cost” means in
respect of each Vessel, an amount of up to One million Five hundred thousand
Euros (€1,500,000) as provided in each relevant Additional Works Contract;

“Additional Works’ Advance A” means an
amount of up to One million One hundred Eighty-Two thousand Euros (€1,182,000)
to be drawn down pursuant to the terms and conditions of

 

 

1

 

this Agreement for the purpose referred to in sub-Clause 2.2 (c) or (as
the context may require) the amount thereof from time to time outstanding
hereunder;

“Additional Works’ Advance B” means an
amount of up to One million One hundred Eighty-Two thousand Euros (€1,182,000)
to be drawn down pursuant to the terms and conditions of this Agreement for the
purpose referred to in sub-Clause 2.2 (c) or (as the context may require) the
amount thereof from time to time outstanding hereunder;

“Additional Works’ Advances” means
collectively the Additional Works’ Advance A and the Additional Works’ Advance
B and, in the singular, means either of them;

“Additional Works’ Contract” means in
respect of each Vessel the “Design Building Supervision Representation
Procurement of Machinery and Supplies and Turn-Key Delivery” contract dated 30th
August 2005 and made between a Borrower and IOTA, as the same may from time to
time be amended, varied or supplemented with the Security Trustee’s prior
written consent, and in the plural, means both of them;

“Advances” means together the Vessel A
Advances and the Vessel B Advances and, in the singular, means any of them;

“AEGEAN PETROLEUM” means AEGEAN MARINE
PETROLEUM S.A. of 80, Broad Street, Monrovia, Liberia;

“AEGEAN PETROLEUM Guarantee” means the
guarantee and indemnity in respect of the Borrowers’ obligations under this
Agreement and the L/C Facility Agreement to be executed by AEGEAN PETROLEUM in
favour of the Security Trustee, as the same may from time to time be amended,
varied or supplemented;

“AEGEAN PETROLEUM NETWORK” means AEGEAN
MARINE PETROLEUM NETWORK INC. of Trust Company Complex, Ajeltake Road, Ajeltake
Island, Majuro MH96960, Marshall Islands;

“AEGEAN PETROLEUM NETWORK Guarantee”
means the guarantee and indemnity in respect of the Borrowers’ obligations
under this Agreement and the L/C Facility Agreement to be executed by AEGEAN
PETROLEUM NETWORK in favour of the Security Trustee, as the same may from time
to time be amended, varied or supplemented;

“AEGEAN SHIPHOLDINGS” means AEGEAN
SHIPHOLDINGS INC. of Trust Company Complex, Ajeltake Road, Ajeltake Island,
Majuro MH96960, Marshall Islands;

“AEGEAN SHIPHOLDINGS Guarantee” means
the guarantee and indemnity in respect of the Borrowers’ obligations under this
Agreement and the L/C Facility Agreement to be executed by AEGEAN SHIPHOLDINGS
in favour of the Security Trustee, as the same may from time to time be
amended, varied or supplemented;

“Agent” means AEGEAN BALTIC BANK S.A.,
in its capacity as agent for the Banks and the L/C Bank under the Finance
Documents, or any successor of it In such capacity appointed under this
Agreement;

“Accounts’ Charge Agreements” means
collectively the Cash Collateral Account Charge Agreement and the Earnings
Accounts’ Charge Agreements and in the singular any of them;

“Applicable Accounting Principles” means
those accounting principles, standards and practices on which preparation of
the Financial Statements are based, which are International Accounting
Standards and principles and practices or such other generally accepted
international accounting principles, standards and practices adopted by the
Borrowers and/or the Corporate Guarantors and/or the other members of the Group
after the date hereof and notified to the Agent and accepted by the Agent;

“Applicable Availability Date” means:

(a)                                  In respect of each Pre-Delivery
Advance: 301h October 2005;

(b)                                  in respect of each Delivery
Advance: the earlier of (i) the Delivery Date of the relevant Vessel and (ii)
the Final Availability Date; and

 

 

2

 

(c)                                  in respect of each Additional
Works’ Advance: the earlier of (i) the Delivery Date of the relevant Vessel and
(H) the Final Availability Date;

“Applicable Margin” means:

(d)                                  in respect of each Vessel A
Advance: (i) during the Pre-Delivery Period in respect of Vessel A: 1.40% per
annum and (h) during the Post-Delivery Period in respect of Vessel A: 1.30% per
annum; and

(e)                                  in respect of each Vessel B
Advance: (I) during the Pre-Delivery Period in respect of Vessel B: 1.40% per
annum and (ii) during the Post-Delivery Period in respect of Vessel B: 1.30%
per annum;

“Approved Insurance Brokers” means the
insurance brokers appointed by the Borrowers with the Security Trustee’s prior
approval;

“Approved S&P Brokers” means each
of:

•                                            H
Clarkson & Company Ltd. of London, England;

•                                            Fearnleys
A/S of Oslo, Norway;

•                                            Maersk
Broker K/S of Copenhagen, Denmark;

•                                            Simpson
Spence & Young of London, England;

•                                            R.S.
Platou AS of Oslo, Norway;

•                                            Arrow
Research Ltd. of London, England;

and any other shipbrokers nominated by the Agent from time to time and
includes their successors in title and, in the plural, means all of them;

“Approved Management Agreement” means
the management agreement in respect of each Vessel made or to be made between
the Manager as manager and the relevant Owner thereof as owner on terms
acceptable to the Security Trustee and the Instructing Group and, in the
plural, means both of them;

“Arranger” means AEGEAN BALTIC BANK S.A.
in its capacity as arranger for the Banks and the L/C Bank under the Finance
Documents or any successor of It in such capacity appointed under this
Agreement;

“Assignment Agreement” means in relation
to each Vessel the first priority assignment agreement relative to the
Earnings, the Insurances and the Requisition Compensation made between the
Owner thereof and the Security Trustee to secure the due payment of the
Indebtedness in form and substance satisfactory to the Creditor Parties in
their sole discretion as the same may from time to time be amended, varied or
supplemented and, in the plural, means both of them;

“Assignment of Refund Guarantees” means
in relation to each Vessel the first priority assignment agreement relative to
the Refund Guarantees of that Vessel to be made between the Owner thereof and
the Security Trustee to secure the due payment of the Indebtedness, in form and
substance satisfactory to the Creditor Parties in their sole discretion as the
same may from time to time be amended varied or supplemented and, in the
plural, means both of them;

“Assignment of Shipbuilding Contract”
means in relation to each Vessel the first priority assignment agreement
relative to the Shipbuilding Contract of that Vessel to be made between the
Owner thereof and the Security Trustee to secure the due payment of the
Indebtedness, in form and substance satisfactory to the Creditor Parties in
their sole discretion as the same may from time to time be amended varied or
supplemented and, in the plural, means both of them;

“Availability Period” means the period
commencing from the date of this Agreement and ending on the Final Availability
Date;

 

 

3

 

“Balloon Payment” means in respect of
each Tranche each of the final payments referred to in sub-Clause 10.1 (b) and,
in the plural, means both of them;

“Bank” means:

(a)                                  a bank listed in Schedule 1 and
acting through its branch indicated in Schedule 1 (or through another branch
notified to the Agent in accordance with Clause 31); or

(b)                                     a direct or indirect assignee or
transferee of such bank or of a successor of it or

(c)                                  a direct or indirect successor
of an assignee or transferee such as is mentioned in (b) unless any of the
foregoing has assigned all of its rights and novated all its obligations and
liabilities under the Finance Documents;

“Borrower A Earnings Account” means the
interest-bearing deposit account number 100286-52017 with account name ‘OCEAN
DYNAMIC CORP — Earnings Account’ to be maintained throughout the Security
Period with the Agent in Athens, the Republic of Greece, such account to
include any substitute account or revised account or revised designation or
number whatsoever;

“Borrower B Earnings Account” means the
interest bearing deposit account number 100287-52022 with account name “SEA
GLOBAL S.A. — Earnings Account”, to be maintained throughout the Security Period
with the Agent in Athens, the Republic of Greece; such account to include any
substitute account or revised account or revised designation or number
whatsoever;

“Borrower A Earnings Account Charge Agreement”
means the first priority assignment pledge and charge agreement to be made
between the Borrower A and the Creditor Parties, assigning, pledging and
charging the Borrower A Earnings Account and the monies from time to time
credited therein to secure the due payment of the Indebtedness in form and substance
satisfactory to the Banks and the L/C Bank in their sole discretion as same may
from time to time be amended, varied or supplemented;

“Borrower B Earnings Account Charge Agreement”
means the first priority assignment pledge and charge agreement to be made
between the Borrower B and the Creditor Parties, assigning, pledging and
charging the Borrower B Earnings Account and the monies from time to time
credited therein to secure the due payment of the Indebtedness in form and
substance satisfactory to the Banks and the L/C Bank in their sole discretion
as same may from time to time be amended, varied or supplemented;

“Broken Funding Costs” means any amount
that the Agent may certify as necessary to compensate the Banks for any loss
incurred or to be incurred by them as a consequence of repayment in respect of
funds borrowed (or committed to be borrowed) or deposits taken (or committed to
be taken) from third parties in connection with the commitment of the Banks in
the Facility, or in liquidating or re-employing such funds or deposits for the
remaining part of the then current Interest Period;

“Builder” means SEVERNAV S.A. of 204,
Timisoara Street, 220242 Drobeta Turnn, Severin, Republic of Romania;

“Business Day” means a day on which
banks and financial markets are open for business in all of London, Athens and
Hamburg;

“Cash Collateral Amount” means an amount
equal to the aggregate of the L/C Facility to be credited to the Cash
Collateral Account in accordance with the terms of this Agreement, or as the context
may require, any balance thereof from time to time standing to the credit of
the Cash Collateral Account;

“Cash Collateral Account” means the
interest bearing deposit account nr 0100285-52028 with account name OCEAN
DYNAMIC CORP. et al — Cash Collateral Account’ to be

 

 

4

 

maintained with the Agent in Athens, the Republic of Greece where
monies shall be deposited in accordance with Clauses 2.3 and 16.1 and the
relevant provisions of the L/C Facility Agreement, such account to include any
substitute account or revised account or revised designation or number
whatsoever;

“Cash Collateral Account Charge Agreement”
means the first priority assignment pledge and charge agreement to be made
between the Borrowers and the Creditor Parties, assigning, pledging and
charging, Inter alia, the Cash
Collateral Account and the monies from time to time credited therein to secure
the due payment of the Indebtedness in form and substance satisfactory to the
Banks and the L/C Bank in their sole discretion as same may from time to time
be amended, varied or supplemented;

“Classification Society” means any
classification society being a member of IACS as the Agent may approve in
writing;

“Commitment” means in relation to a Bank
the amount set out opposite its name in Schedule 1 as reduced or cancelled by
any relevant term of this Agreement

“Commitment Letter” means the letter
dated 16th September 2005 issued by the Agent and addressed to, inter alia, the Borrowers and two of the
Corporate Guarantors duly accepted by them on 28th September 2005;

“Compulsory Acquisition” means
requisition for title or other compulsory acquisition, requisition,
appropriation, expropriation, deprivation, forfeiture or confiscation for any
reason of a Vessel by any Government Entity or other competent authority,
whether de jure or de facto, but shall exclude requisition for use or hire not
involving requisition of title;

“Contract Price” means in respect of
each Vessel, an amount of Six million Eight hundred Thirty-Five thousand Euros
(€6,835,000) as the same may be adjusted in accordance with the terms of the
Shipbuilding Contract relating to such Vessel;

“Corporate Guarantees” means together
the Manager’s Guarantee and AEGEAN PETROLEUM Guarantee and AEGEAN PETROLEUM
NETWORK Guarantee and AEGEAN SHIPHOLDINGS Guarantee and, in the singular, means
any of them;

“Corporate Guarantors” means together
the Manager and AEGEAN PETROLEUM and AEGEAN PETROLEUM NETWORK and AEGEAN
SHIPHOLDINGS and in the singular, means any of them;

“Corporate Security Parties” means those
of the Security Parties, which are companies or corporations but not natural
persons and in the singular means any of them;

“Creditor Party” means each Servicing
Bank, each Bank and the L/C Bank whether at the date of this Agreement or at
any time thereafter;

“Default Rate” means the aggregate of
(i) EURIBOR, (ii the Applicable Margin and (iii) Two per cent (2%) per annum;

“Delivery Advances” means collectively
the Delivery Advance A and the Delivery Advance B and, in the singular, means
either of them;

“Delivery Advance A” means an amount of
up to Three hundred Forty-One thousand Seven hundred Fifty Euros (€341,750) to
be drawn down pursuant to the terms and conditions of this Agreement for the
purpose referred to in sub-Clause 2.2 (b) or (as the context may require) the amount
thereof from time to time outstanding hereunder;

“Delivery Advance B” means an amount of
up to Three hundred Forty-One thousand Seven hundred Fifty Euros (€341,750) to
be drawn down pursuant to the terms and conditions of this Agreement for the
purpose referred to in sub-Clause 2.2 (b) or (as the context may require) the
amount thereof from time to time outstanding hereunder;

 

 

5

 

“Delivery Date” means in relation to
each Vessel the date on which such Vessel is delivered by the Builder to the Owner thereof and,
in the plural, means both of them;

“Delivery Instalment” means the
instalment of the Contract Price of a Vessel payable by the Owner thereof to
the Builder on the Delivery Date of that Vessel in accordance with the
Shipbuilding Contract related to such Vessel and, in the plural, means both of
them;

“Delivery Instalment Payment Date” means
in respect of each Vessel the date provided in Article Ill Clause 4(e) of the
relevant Shipbuilding Contract and, in the plural, means both of them;

“Distribution Monies” means:

(a)                                  any monies received by the
Creditor Parties or any of them (or by any receiver or similar person appointed
by any of them) from an Enforcement Action, or from the proceeds or dissolution
or liquidation of any Security Party or distribution of its/his assets among
its creditors (however such liquidation or distribution may occur);

(b)                                  any monies received by the
Creditor Parties (or any of them) as named insured, loss payee, beneficiary or
assignee of any insurance policies of any Security Party in consequence of or
after any Enforcement Action;

“Drawdown Date” means the Business Day
on which the Borrowers have requested an Advance to be made in accordance with
Clause 2.1 or (as the context requires) the date on which such Advance is
actually made;

“Earnings” means all freights, charter
hires and any other amounts whatsoever which may at any time be earned by, or
become payable to or for the account of each Borrower or its agents arising out
of or as a result of the ownership, management and/or operation of a Vessel by
her Owner or its agents, or under or in relation to any charterparty, contract
of carriage or other contract (Including a salvage or towage contract) for the
use, operation or management of a Vessel, together with all payments for the
variation of any such contract, all damages for any breach of any such
contract, all general average and salvage remuneration and all compensation
receivable in respect of any requisition for hire;

“Earnings Accounts” means together the
Borrower A Earnings Account and the Borrower B Earnings Account and In the
singular either of Them;

“Earnings Accounts’ Charge Agreements”
means collectively the Borrower A Earnings Account’s Charge Agreement and the Borrower
B Earnings Account’s Charge Agreement and h the singular means either of them;

“EMU Legislation” means legislative
measures of the Council of the European Union for the introduction of,
changeover to, or operation of, a single or unified European currency being
part of the implementation of the Third Stage;

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

“Enforcement Action” shall mean any of
the following actions taken by any of the Creditor Parties by means of an
instruction to the Security Trustee, by an Instructing Group or otherwise:

(a)                                  accelerating the due date of any
liability of the Borrowers or either of them;

(b)                                  commencing to enforce or enforcing
any Finance Documents;

 

 

6

 

(c)                                  commencing or instructing the
Security Trustee to commence to enforce or to enforce the Finance Documents or
any of them or exercising any power under any Finance Document;

(d)                                  (d) taking any other action
against any of the Security Parties or their assets or threatening any other
action against any of the Security Parties or their assets the taking of which
could materially affect the common interests of the Creditor Parties;

“Environmental Approvals” means any
permit, licence, approval, ruling, certification, variation, exemption or other
authorisation relating to a Borrower and/or a Borrower’s business and/or the
Manager and /or the Managers business and/or any other member of the Group
and/or a Vessel and/or any other Relevant Ship required under applicable
Environmental Laws;

“Environmental Claim” means:

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

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

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

“Environmental Incident” means:

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

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

(c)                                  any incident in which Material
of Environmental Concern is released, discharged, disposed of, or emitted by or
from a ship other than a Relevant Ship and where a Relevant Ship is actually or
potentially liable to be arrested or attached as a result and/or where any
owner and/or any operator or a manager of a Relevant Ship is actually or
allegedly at fault or otherwise liable (in whole or in part);

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

“EURIBOR” means, for an Interest Period:

(a)                                  the rate per annum equal to the
offered quotation for deposits in Euros for a period equal to, or as near as
possible equal to, the relevant Interest Period which appears on the
appropriate page of the Reuters Monitor Money Rates Service at or about 11.00
a.m. (Brussels time) on the Quotation Date for that Interest Period; or

(b)                                  if no rate is quoted on the
appropriate page of the Reuters Monitor Money Rates Service, the rate per annum
determined by the Agent to be the arithmetic mean

 

 

7

 

(rounded upwards, if necessary,
to the nearest one-sixteenth of one per cent.) of the rates per annum notified
to the Agent by each Bank as the rate at which deposits in Euros are offered to
that Bank by leading banks in the European Interbank Market at that Banks’
request at or about 11.00 a.m. (Brussels 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;

“Euro” and “Euros”
means, for the time being, the single currency of Participating Member States
as provided in the EMU Legislation;

“European Interbank Marker” means the
interbank market for Euros operating in Participating Member States;

“Event of Default” means any of the
events listed in Clause 22.1;

“Facility” means the amount of up to
Thirteen million Three hundred thousand Euros (€13,300,000) to be made
available in up to two (2) Tranches to the Borrowers by the Banks pursuant to
the terms of Clauses 2 and 3 or if the context may so require so much thereof
as shall for the time being be outstanding to the Banks hereunder;

“Final Availability Date” means 30th October 2007 (or such later date
as the Agent may agree with the authorisation of the Banks);

“Final Maturity Date” means the earlier
of (i) the date falling ten (10) years from the Delivery Date last to occur and
(ii) 3e October 2017;

“Finance Documents” means:

(a)                                  this Agreement;

(b)                                  the Security Documents;

(c)                                  the L/C Facility Agreement; and

(d)                                  any other document (whether
creating an Encumbrance or not) which is executed at any time by the Borrowers
or any other Security Party or any Creditor Party 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 Creditor Parties or any of them under
this Agreement, the L/C Facility Agreement or any of the documents referred to
in this definition;

“Financial Statements” means the audited
annual financial statements of the Borrowers, the Corporate Guarantors and of
all other members of the Group referred to in Clause 18.1.1, comprising of a
statement of income, balance sheet, cash flow statement and relative notes;

“First Repayment Date” means in relation
to each Tranche the date falling three (3) months after the earlier of (i) the
Drawdown Date of the Delivery Advance of such Tranche and (ii) the Final
Availability Date;

“Government Entity” means and includes
(whether having a distinct legal personality or not) any national or local
government authority, board, commission, department, division, organ,
instrumentality, court or agency or tribunal and any association, organisation
or institution of which any of the foregoing is a member or to whose
jurisdiction any of the foregoing is subject or in whose activities any of the
foregoing is a participant;

“Group” means, together, AEGEAN
PETROLEUM NETWORK and its Subsidiaries from time to time (including, for the
avoidance of doubt, the Borrowers) and “member of the Group” shall be construed
accordingly;

 

 

8

 

“Indebtedness” means any and all moneys,
liabilities and obligations (whether actual or contingent, whether existing or
hereafter arising, whether or not for the payment of money, and including,
without limitation, Broken Funding Costs (if any), and any obligation or
liability to pay damages) which are now or which may at any time and from time
to time hereafter be due, owing, payable or incurred or expressed to be due, owing,
payable or incurred from the Borrowers (whether as principal, surety or
otherwise) to the Creditor Parties or any of them under this Agreement, the L/C
Facility Agreement and the other Finance Documents;

“Instalments” means in respect of each
Vessel collectively the Pre-Delivery Instalments and the Delivery Instalment in
respect thereof and, in the singular, means any of them;

“Instalment Payment Date” means in
respect of each Vessel collectively the Steel Cutting Instalment Date, the Keel
Laying instalment Payment Date, the Launching Instalment Payment Date and the
Delivery Instalment Payment Date and, in the singular, means any of them;

“Instructing Group” means:

(a)                                  subject to (b) below, all the
Banks the aggregate of whose Commitments (as reduced pursuant to the relevant
provisions of this Agreement) equals or exceeds seventy per cent (70%) of the
Total Commitments; and

(b)                                  if any Bank transfers its
Commitment (in part or in whole) pursuant to Clause 31 (Assignments) its
reduced Commitment shall be used in the calculation in (a) above;

“Insurance Documents” means all slips,
contracts, policies, certificates of entry or other insurance documents
evidencing or constituting the Insurances;

“Insurances” means all policies and
contracts of insurance (including all entries of a Vessel in a protection and
indemnity and war risks association) or such other arrangements by way of
insurance which are from time to time taken out or entered into In respect of
or in connection with a Vessel and the Earnings pursuant to Clause 20 of this
Agreement and all benefits of such insurances, including all claims of
whatsoever nature and return of premiums;

“Insurers” means the underwriters,
insurance companies and mutual insurance associations with or by which the
Insurances are effected;

“Interest Determination Date” means the
date of determination of an Interest Rate by the Agent for the relevant
Interest Period in accordance with Clause 5.3;

“Interest Payment Date” means the last
day of each Interest Period save that in the case of any Interest Period of
more than three (3) months duration, the Interest Payment Dates shall be each
of the dates falling at consecutive three (3) monthly intervals after the
commencement thereof and the last day thereof provided that if any such date is
not a Business Day the relevant Interest Payment Date shall be the next
succeeding day which is a Business Day unless such next succeeding Business Day
falls in another calendar month in which event the relevant Interest Payment
Date shall be the immediately preceding Business Day;

“Interest Period” means each of the
successive periods determined in accordance with Clause 6 of this Agreement;

“Interest Rate” means the aggregate of
(a) the Applicable Margin and (b) EURIBOR;

“IOTA” means IOTA CORPORATION of 80,
Broad Street, Monrovia, Liberia;

“ISM Code” means, in relation to its
application to the Borrowers, the Manager, the Vessels and their operation -

 

 

9

 

(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

(b)                                  all further resolutions,
circulars, codes, guidelines, regulations and recommendations which are now or
in the future issued by or on behalf of the International Maritime Organisation
or any other entity with responsibility for implementing the ISM Code,
including without limitation, the ‘Guidelines on implementation or
administering of the International Safety Management (ISM) Code by
Administrations’ produced by the International Maritime Organisation pursuant
to Resolution A.788(19) adopted on 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 and
safety management certificate issued pursuant to the ISM Code in relation to a
Vessel 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 Security Trustee may require; and

(c)                                  any other documents which are
prepared or which are otherwise relevant to establish and maintain a Vessel’s
and/or the Owner’s thereof compliance with the ISM Code which the Security
Trustee may require;

“ISM Responsible Person” means:

(a)                                  each and every person who has
assumed responsibility for the operation of a Vessel and has agreed to take
over or is required to assume responsibility for the performance or observance
of the duties and responsibilities imposed by the ISM Code; and

(b)                                  each and every person ashore who
is a ‘designated person’ for the purposes of the ISM Code with direct access to
the highest level of management of the Owner’s or any other operator of a
Vessel and who, in that capacity, has under the ISM Code responsibility and
authority which includes -

(c)                                  monitoring the safety and
pollution prevention aspects of the operation of a Vessel; and

(d)                                  ensuring that adequate resources
and shore-based support are supplied,

as required under the ISM Code;

“ISM SMS” means, in relation to a
Vessel, the safety management system for such Vessel which is required to be
developed, Implemented and maintained by the Owner thereof under the ISM Code;

“ISPS Code” means the International Ship
and Port Facility Security Code adopted by the International Maritime
Organization Assembly as the same may have been or may be amended or
supplemented from time to time;

“ISPS Code Documentation” includes:

 

 

10

 

(a)                                  the International Ship Security
Certificate issued pursuant to the ISPS Code in relation to a Vessel within the
periods specified by the ISPS Code; and

(b)                                  all other documents and data
which are relevant to the ISPS Code and its implementation and verification
which the Banks may require;

“Keel Laying Instalment” means the
instalment of the Contract Price of a Vessel payable by the Owner thereof to
the Builder on the date of the laying of the keel of that Vessel in accordance
with the Shipbuilding Contract related to such Vessel and, in the plural, means
both of them;

“Keel Laying Instalment Payment Date”
means in respect of each Vessel the date provided in Article ill Clause 4
paragraph (c) of the relevant Shipbuilding Contract;

“Launching Instalment” means the
instalment of the Contract Price of a Vessel payable by the Owner thereof to
the Builder on the date of the launching of such Vessel in accordance with the
Shipbuilding Contract related to such Vessel and, in the plural, means both of
them;

“Launching instalment Payment Date” means
in respect of each Vessel the date provided in Article III Clause 4 paragraph
(d) of the relevant Shipbuilding Contract;

“LIC Bank” means HSH NORDBANK AG, in its
capacity as issuing bank under the L/C Facility Agreement, or any successor of
it in such capacity;

“L/C Facility” means the facility for an
aggregate amount of up to Twelve million Three hundred Three thousand Euros
(€12,303,000) to be made available to the Borrowers by the L/C Bank for the
purpose of issuance of Letters of Credit pursuant to the terms of the L/C
Facility Agreement;

“L/C Facility Agreement” means the
agreement made or to be made by and among the LIC Bank and the Borrowers
pursuant to which the L/C Bank shall make available to the Borrowers the L/C
Facility, as the same may from time to time be amended varied or supplemented;

“Letters of Credit” or “L/Cs” means collectively the two letters of credit to be
issued by the L/C Bank in favour of the Builder in connection with each
Shipbuilding Contract in accordance with the terms of the L/C Facility
Agreement together with any amendments thereto or supplements thereof and, in
the singular, means either of them;

“Manager” means AEGEAN BUNKERING
SERVICES INC., a corporation duly formed and validly existing under the laws of
the Republic of Marshall Islands, having its registered office at Trust Company
Complex, Ajeltake Road, Ajeltake Island, Majuro MH96960, Republic of the
Marshall Islands or any other company approved by the Security Trustee as
manager of the Vessels;

“Manager’s Guarantee” means the
guarantee and indemnity in respect of the Borrowers’ obligations under this
Agreement and the other Finance Documents to be executed by the Manager in
favour of the Security Trustee in form and substance satisfactory to the Banks
in its sole discretion as the same may from time to time be amended, varied or
supplemented;

“Market Value” means the market value of
a Mortgaged Vessel determined in accordance with Clause 17.1;

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

“Mortgage” means in relation to each
Vessel the first preferred or priority mortgage over each Vessel to be executed
and delivered by the Owner thereof in favour of the Security Trustee or the
Creditor Parties as appropriate to secure the due payment of the Indebtedness,
in form

 

 

11

 

and substance satisfactory to the Banks in their sole discretion as the
same may from time to time be amended, varied or supplemented and, in the
plural, means both of them;

“Mortgaged Vessel” means at any relevant
time a Vessel which is, at such time, subject to a Mortgage and/or the
Earnings, Insurances and Requisition Compensation of which are subject to an
Encumbrance and, in the plural, means both of them;

“Notice of Drawdown” means the written
notice in the form set out in Schedule 2 (or in any other form which the Agent may
request);

“Nomination Date” means the Business
Day, which is three (3) Business Days prior to the commencement of an Interest
Period;

“Owner” means:

(a)                                  in respect of the Vessel A: the
Borrower A; and

(b)                                  in respect of the Vessel B: the
Borrower B,

and in the plural means both of them;

“Participating Member State” means each
state so described in any EMU Legislation;

“Party” means in relation to any
document, a party to that document;

“Permitted Encumbrance” means:

(a)                                  any Encumbrance created by or
pursuant to the Finance Documents; and

(b)                                  any lien on a Vessel for crew’s
wages or salvage or otherwise arising in the normal course of trading and being
regularly settled, the total amount of such lien or liens not to be material in
the sole opinion of the Agent in relation to any security created in favour of
the Security Trustee or the Creditor Parties pursuant to the Finance Documents;

“Post-Delivery Period” means in respect
of each Vessel the period commencing on the Delivery Date on such Vessel and
ending on the date on which the Indebtedness shall have been repaid in full to
the Creditor Parties;

“Potential Event of Default” means any
event which may become with the giving of notice or passage of time or other
conditions or any combination of the foregoing, an Event of Default;

“Pre-Delivery Advance A” means an amount
of up to Five million One hundred Twenty-Six thousand Two hundred Fifty Euros (€5,126,250)
to be drawn down pursuant to the terms and conditions of this Agreement for the
purpose referred to in sub-Clause 2.2 (a) or (as the context may require) the
amount thereof from time to time outstanding hereunder;

“Pre-Delivery Advance B” means an amount
of up to Five million One hundred Twenty-Six thousand Two hundred Fifty Euros
(€5,126,250) to be drawdown pursuant to the terms and conditions of this
Agreement for the purpose referred to in sub-Clause 2.2 (a) or (as the context
may require) the amount thereof from time to time outstanding hereunder;

“Pre-Delivery Advances” means
collectively the Pre-Delivery Advance A and the Pre-Delivery Advance B and, in
the singular, means either of them;

“Pre-Delivery Instalments” means in
respect of each Vessel collectively the Steel Cutting Instalment, the Keel
Laying Instalment and the Launching Instalment in respect of such Vessel and,
in the singular, means any of them;

 

 

12

 

“Pre-Delivery Period” means in respect
of each Vessel the period commencing on the Drawdown Date of the Pre-Delivery
Advance drawn down in respect of such Vessel and ending on the Delivery Date of
such Vessel;

“Proceeds” means the proceeds paid under
the terms of the Finance Documents (including but not limited to the proceeds
of a sale of a Vessel, the Earnings and the Insurances), the proceeds from the
enforcement of any of the Finance Documents, and following an Event of Default
any moneys to the credit of the Borrowers or either of them in the Accounts or
any of them;

“Proportionate Share” means, at any
time, the proportion which that Bank’s Commitment (which has been advanced)
then bears to the aggregate Commitments of all the Banks (which have been
advanced).

“Protection and Indemnity Risks” means
the usual risks covered by a protection and indemnity association that is a
member of the International Group of Protection and Indemnity Associations,
including the proportion not otherwise recoverable In case of collision under
the ordinary running-down clause;

“Purchase Documents” means in respect of
each Vessel all documents referred to in Article VIII, Clause 3 of the relevant
Shipbuilding Contract which shall be delivered to the relevant Owner by the
Builder including without limitation, the Builders certificate, the Builder’s
invoices, the bill of sale, the protocol of delivery and acceptance, the
commercial invoices and the class certificates;

“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 Target Day on which
quotations would ordinarily be given by leading banks in the European Interbank
Market for deposits in Euros for delivery on the first day of that Interest
Period or other period;

“Refund Guarantee” means collectively
each refund guarantee to be issued by the Refund Guarantor pursuant to each
Shipbuilding Contract and, in the singular, means any of them;

“Refund Guarantor” means BANCA
COMMERCIALA ROMANA S.A. of the Republic of Romania and/or any other bank
acceptable to Creditor Parties, In their sole discretion, as issuing bank of
the Refund Guarantees and, in the plural, means all of them;

“Related Company” means:

(a)                                  of a person who is a Creditor
Party, means any Subsidiary of such person, any company or other entity of
which such person is a Subsidiary and any Subsidiary of any such company or
entity-, or

(b)                                  of a Security Party, means any
company or other entity which is active in the bunkering business or services
and which is:

(i)                                         a Subsidiary of the relevant
Security Party; or

(ii)                                      any company or other entity (“holding
company”) of which such Security Party is a Subsidiary; or

(iii)                                   any Subsidiary (other than such
Security Party) of any such holding company;

“Relevant Ship” means the Vessels and
any other ship from time to time owned, managed or crewed by, or demise or
bareboat chartered to a Borrower and/or any other member of the Group;

“Requisition Compensation” means all
compensation payable by reason of any Compulsory Acquisition of a Vessel;

 

 

13

 

“Repayment Date” means in respect of
each Tranche, the First Repayment Date in respect of such Tranche and each of
the thirty nine (39) dates falling at three (3) monthly intervals after such
First Repayment Date up to and including the date falling one hundred and
seventeen days after such First Repayment Date, provided that if such day Is
not a Business Day, that Repayment Date shall be the next succeeding day which
is a Business Day unless such next succeeding Business Day falls in another
calendar month in which event that Repayment Date shall be the immediately
preceding Business Day;

“Repayment Instalment” means in respect
of each Tranche each of the instalments referred to in sub-Clause 10.1 (a) and,
in the plural, means all of them;

“Security Documents” means together the
Mortgages, the Assignment Agreements, the Accounts’ Charge Agreements, the
Assignments of the Shipbuilding Contracts, the Assignments of the Refund
Guarantees, the Corporate Guarantees and any other agreement or document that
may be executed at any time by the Borrowers, the other Security Parties or any
other person as security for all or any part of the Indebtedness and in the singular
means any of them;

“Security Parties” means each Party to
the Finance Documents (other than the Creditor Parties) and in the singular
means any one of them;

“Security Period” means the period
commencing with the execution of this Agreement and ending on the date on which
the Indebtedness is repaid in full to the Creditor Parties to the full
satisfaction of the Security Trustee;

“Security Requirement” means the amount
in Euros (as certified by the Agent whose certificate shall, in the absence of
manifest error, be conclusive and binding on the Borrowers and the Creditor
Parties) which is, at any relevant time:

(a)                                  during the period commencing on
the earlier of (9 the Drawdown Date of the last Delivery Advance to be drawn
down and (ii) the Final Availability Date and ending on the date falling sixty
(60) months thereafter (the “Security Requirement Adjustment Date”), One
hundred Twenty-Five per cent (125%) of the Facility;

(b)                                  during the period commencing on
the date falling immediately after the Security Requirement Adjustment Date and
ending on the date when all amounts owing under this Agreement and the other
Finance Documents have been paid in full, One hundred Thirty-Five per cent
(135%) of the Facility;

“Security Trustee” means AEGEAN BALTIC
BANK S.A., in its capacity as security trustee for the Banks and the L/C Bank
under the Finance Documents, or any successor of it in such capacity appointed
under this Agreement;

“Security Value” means the amount in
Euros (as certified by the Agent whose certificate shalt in the absence of
manifest error, be conclusive and binding on the Borrowers and the Creditor
Parties) which is, at any relevant time, the aggregate of the market values of
the Mortgaged Vessels as most recently determined in accordance with Clause 17.1;

“Servicing Bank” means each of the
Arranger, the Agent and the Security Trustee whether as at the date of this
Agreement or at any time thereafter,

“Shipbuilding Contract A” means the
shipbuilding contract dated 3rd June 2005 entered into between the
Builder as builder/seller and the Borrower A as buyer, for the construction and
completion of the Vessel A at the Contract Price, as the same may from time to
time be amended, varied or supplemented, with the Security Trustee’s prior
written consent;

“Shipbuilding Contract” means the
shipbuilding contract dated 3rd June 2005 entered into between the Builder as
builder/seller and the Borrower B as buyer, for the construction and completion
of the Vessel B at the Contract Price, as same may from time to time be
amended, varied or supplemented;

 

 

14

 

“Shipbuilding Contracts” means together
the Shipbuilding Contract A and the Shipbuilding Contract B, and, in the
singular, means either of them;

“Steel Cutting Instalment” means the
instalment of the Contract Price of a Vessel payable by the Owner thereof to
the Builder on the date of the steel cutting of that Vessel in accordance with
the Shipbuilding Contract related to such Vessel and, in the plural, means both
of them;

“Steel Cutting Instalment Payment Date”
means in respect of each Vessel the date provided in Article Ill Clause 4
paragraph (b) of each relevant Shipbuilding Contract;

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

“Subject Document” means all of the
Finance Documents, the Shipbuilding Contracts, the Additional Works Contracts,
the Refund Guarantees, the Letters of Credit, the Purchase Documents and the
Approved Management Agreements (none to be amended, varied, supplemented or
modified without the consent of the Security Trustee) and together with any
other instruments, document or memorandum, scheduled to any of the documents
referred to above, and any notice, consent or acknowledgement referred to in or
required pursuant to any of the documents referred to above and any document,
instrument or memorandum which secures any of the obligations of the Borrowers
under any of the Finance Documents or under any other Subject Document;

“Target Day” means a day on which the
Trans-European Automated Real time Gross settlement Express Transfer system is
open, which Is, at the date of this Agreement, any day (other than a Saturday
or Sunday) other than Christmas Day and New Years Day;

“Taxes” means any present or future tax,
levy, impost, duty, charge, fee, deduction or withholding of any nature and
whatever called, by whomsoever, on whomsoever and wherever imposed, levied,
collected, withheld or assessed (other than taxes on the overall net income of
the Banks) and ‘Tax” and “Taxation” shall be construed accordingly;

“Third Stage” means the third stage of
European economic and monetary union pursuant to the Treaty on European Union;

“Total Commitments” means in relation to
the Banks, the aggregate for the time being of their respective Commitments in
respect of the Facility;

“Total Construction Cost” means in
respect of each Vessel together the Additional Construction Cost and the
Contract Price;

“Total Loss” means in relation to a
Vessel:

(a)                                  the actual or constructive or
compromised or arranged or agreed total loss of a Vessel; or

(b)                                  the Compulsory Acquisition of a
Vessel,: or

(c)                                  the hijacking, theft,
condemnation, capture, seizure, arrest, detention or confiscation of a Vessel
(other than where the same amounts to the Compulsory Acquisition of a Vessel)
by any Government Entity or by persons acting or purporting to act on behalf of
any Government Entity unless a Vessel be released and restored to the Owner
thereof from such hijacking, theft, condemnation, capture, seizure, arrest,
detention or confiscation within thirty (30) days after the occurrence thereof;

“Tranches” means collectively the Vessel
A Tranche and the Vessel B Tranche and, in the singular, means either of them;

 

 

15

 

“Transfer Certificate” means a
certificate substantially in the form set out in Schedule 3 signed by a Bank
and a Transferee whereby:

(i)                                    such Bank seeks to procure the transfer to
such Transferee of all or a part of the Bank’s rights and obligations
hereunder, subject to and upon the terms and conditions set out in Clause 31;
and

(ii)                                 such Transferee undertakes to perform the
obligations it will assume as a result of delivery of such certificate to the
Agent as contemplated in Clause 31.5;

“Transferee” means a bank to which a
Bank seeks to transfer all or part of its rights and obligations in accordance
with Clause 31;

“Treaty on European Union” means the
Treaty of Rome of 25 March 1957, as amended by the Single European Act 1986 and
the Maastricht Treaty of 7 February 1992;

“Trust Property” means collectively —

(i)                                   the security, powers, rights, titles,
benefits and interests (both present and future) constituted by and conferred
on the Security Trustee under or pursuant to the Finance Documents (including,
without limitation, the benefit of all covenants and undertakings given in the
Finance Documents);

(ii)                                all moneys, property and other assets paid or transferred to or vested
in the Security Trustee (or any agent of the Security Trustee) or received or
recovered by the Security Trustee and/or the Agent (or any agent of the
Security Trustee and/or the Agent) pursuant to, or in connection with, any of
the Finance Documents; and

(iii)                             all rights, benefits, interests, money, investments, property, and
other assets at any time representing or deriving from any of the foregoing,
including all interest, income and other sums at any time received or
receivable by the Security Trustee (or the Agent or any other agent of the
Security Trustee and/or the Agent) in respect of the same (or any part
thereof);

“Vessel A” means the double-hull single
screw diesel engine driven carder of diesel oil gasoline and other clean and
dirty oil products with roro facility of approximately 2,400 dwt having hull
no. N2230007 to be constructed by the Builder pursuant to the Shipbuilding
Contract A, to be acquired by the Borrower A and to be registered on the
relevant Delivery Date in its ownership under a flag acceptable to the Creditor
Parties under a name approved by the relevant flag authorities;

“Vessel A Advances” means collectively
the Pre-Delivery Advance A, the Delivery Advance A and the Additional Works
Advance A and in the singular, means any of them;

“Vessel A Tranche” means that part of
the Facility consisting of the Vessel A Advances;

“Vessel B” means the double-hull single
screw diesel engine driven carrier of diesel oil gasoline and other clean and
dirty oil products of approximately 2,400 dwt having hull no. N2220000 being
constructed by the Builder pursuant to the Shipbuilding Contract B to be
acquired by the Borrower B and to be registered on the relevant Delivery Date
in its ownership under a flag acceptable to the Creditor Parties under a name
approved by the relevant flag authorities;

“Vessel B Advances” means collectively
the Pre-Delivery Advance B, the Delivery Advance B and the Additional Works
Advance B and in the singular, means any of them;

“Vessel B Tranche” means that part of
the Facility consisting of the Vessel B Advances;

 

 

16

 

“Vessel’s Security Documents” means in
respect of each Vessel together the Mortgage and the Assignment Agreement in
respect of such Vessel and, in the singular, means any of them;

“War Risks” means the risk of any
hostile acts, mines or torpedoes and all risks excluded by F.C. & S Clauses
24 - 26 (inclusive) of the Institute Time Clauses (Hulls) (1.11.95) (or any
equivalent provision); and

1.2                               In this Agreement references to
the “Arranger”, the “Agent”,
the “Security Trustee”, the “L/C Bank” or any “Bank” shall be
construed so as to include its and any subsequent successors, assigns,
transferees and sub-participants In accordance with their respective interests.

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

1.4                               In this Agreement unless the
context otherwise requires -

1.4.1                                             clause headings and sub-headings
are inserted for convenience only and shall not affect the construction of the
Agreement and unless otherwise specified, all references to Clauses and
Schedules are to clauses of, and schedules to, this Agreement;

1.4.2                                             words importing the singular
shall include the plural and vice versa;

1.4.3                                             fees, costs and expenses shall
be exclusive of any value added tax or similar tax (if any) which shall
accordingly be payable in addition;

1.4.4                                             any reference to agreements,
documents or instruments includes a reference to that agreement, document or
instrument as amended, supplemented, substituted, novated, replaced or assigned
from time to time;

1.4.5                                             references to persons Include
any individual, partnership, firm, trust, body corporate, government,
governmental body, authority, agency, unincorporated body of persons or
association;

1.4.6                                             a reference to any enactment or
statutory provision include any enactment or statutory provision which amends,
extends, consolidates or replaces the same or which has been amended, extended,
consolidated or replaced by the same and shall include any orders, regulations,
codes of practice, instruments or other subordinated legislation made under the
relevant enactment or statutory provision;

1.4.7                                             the words ‘herein’, ‘hereto’ and
‘hereunder refer to this Agreement as a whole and not to the particular Clause
or Schedule in which the words may be used;

1.4.8                                             the liquidation, winding-up or
dissolution of a company or body corporate or the appointment of a receiver,
manager or administrator of or in relation to a company or body corporate or
any of Its assets shall be construed so as to include any equivalent or
analogous proceedings under the law of the jurisdiction in which it is
Incorporated or any jurisdiction In which it carries on business or has assets
or liabilities; and

1.4.9                                             a reference to any “relevant
Advance” (including without limitation any Pre-Delivery Advance, and Delivery
Advance or any Additional Works’ Advance) when used in connection with a
particular Vessel shall be construed as reference to the Vessel

 

 

17

 

being financed by such Advance
and references to the “relevant Broker” or “relevant Owner shall be construed
accordingly.

1.5                               This Agreement supersedes the
terms and conditions contained in any correspondence relating to the subject
matter of this Agreement exchanged between the Arranger, the Agent or the
Security Trustee or any of the Banks and the Borrowers or their representatives
prior to the date of this Agreement, including, without limitation, the
Commitment Letter.

2                                         THE FACILITY
— THE BORROWERS’ JOINT AND SEVERAL LIABILITY — THE CASH COLLATERAL ACCOUNT

2.1                               Subject to the terms and
conditions of this Agreement, each of the Banks hereby agree to make available
to the Borrowers upon the terms and subject to the conditions of this Agreement
its Commitment of an aggregate amount not exceeding at any relevant time
Thirteen million Three hundred thousand Euros (€13,300,000) to finance up to 80%
of the Total Construction Cost of the Vessels in two (2) equal Tranches, each
in the amount of up to Six million Six hundred and Fifty thousand Euros
(€6,650,000) each of which shall be provided in Three (3) Advances provided
however that:

(a)                                  a Pre-Delivery Advance in
respect of a Vessel shall be in an amount of up to 75% of the Contract Price of
that Vessel;

(b)                                  a Delivery Advance in respect of
a Vessel which when aggregated with the amount of the Pre-Delivery Advance in
respect of that Vessel shall not exceed 80% of the Contract Price of that
Vessel; and

(c)                                  an Additional Works’ Advance in
respect of a Vessel shall not exceed 80% of the Additional Construction Cost of
that Vessel.

2.2                               Each of the Borrowers hereby
undertakes to use the entire proceeds of each Advance as follows:

(a)                                  each Pre-Delivery Advance for
the purpose of assisting each Borrower in securing its obligations under the
L/C Facility Agreement, provided however that both Pre-Delivery Advances shall
be made available to the Borrowers on the same Drawdown Date;

(b)                                  each Delivery Advance for the
purpose of assisting each Borrower in refinancing shareholders loans incurred
in connection with the construction of the Vessel being purchased by it; and

(c)                                  each Additional Works’ Advance
for the purpose of assisting each Borrower in re­financing shareholders’ loans
incurred in connection with the Additional Works’ Contract of the Vessel being
purchased by it.

2.3                               Each of the Borrowers hereby (a)
irrevocably instructs the Banks and the Agent to credit both Pre-Delivery
Advances on the Drawdown Date to the Cash Collateral Account, (b) undertakes

to pay to the credit of the Cash Collateral Account on or prior to the
Drawdown Date of the Pre-Delivery Advances any and all amounts required so that
the amount credited to the Cash Collateral Account is equal to the amount of
the L/C Facility, provided however that the Agent shall (and is hereby irrevocably
instructed by the Borrowers to effect the relevant payments) at the written
request of the Borrowers’ and with the prior written consent of the L/C Bank
make the following payments to the Builder from funds credited to the Cash
Collateral Account subject to (i) no Event of Default having occurred, co no
prior demand in respect of the relevant sum under a Letter of Credit having
been made and (iii) the conditions precedent referred to in Clause 16.2 having
been duly fulfilled to the satisfaction of the Security Trustee:

 

 

18

(a)                                  an
amount of up to Euros One million Twenty-Five thousand Two hundred Fifty
(€1,025,250) towards payment to the Builder of the Steel Cutting Instalment for
each Vessel on the Steel Cutting Instalment Payment Date in respect thereof,

(b)                                  an
amount of up to Euros One million Twenty-Five thousand Two hundred Fifty
(€1,025,250) towards payment to the Builder of the Keel Laying Instalment for
each Vessel on the Keel Laying Instalment Payment Date in respect thereof;

(c)                                  the
amount of up to Euros One million Three hundred Sixty-Seven thousand
(€1,367,000) towards payment to the Builder of the Launching Instalment for
each Vessel on the Launching Instalment Payment Date in respect thereof;

(d)                                  the
amount of up to Euros Two million Seven hundred Thirty-Four thousand
(€2,734,000) towards payment to the Builder of the Delivery Instalment for each
Vessel on the Delivery Instalment Payment Date in respect thereof.

2.4                               Subject
to the terms of this Agreement, each of the Banks shall make their respective
Commitment available to the Borrowers on each Drawdown Date in respect thereof.

2.5                               All
the liabilities and obligations of the Borrowers under this Agreement shall,
whether expressed to be so or not, be Joint and several so that each Borrower
shall be jointly and severally responsible with the other Borrower for all
liabilities and obligations of the Borrowers under this Agreement and so that
such liabilities and obligations shall not be impaired by:

1.                                      any
failure of this Agreement to be legal, valid, binding and enforceable in
relation to either of the Borrowers whether as a result of lack of corporate
capacity, due authorisation, effective execution or otherwise;

2.                                      any
giving of time, forbearance, indulgence, waiver or discharge in relation to
either of the Borrowers or to any other party of the Security Documents; or

3.                                      any
other matter or event whatsoever which might have the effect of impairing all
or any of the liabilities and obligations of either of the Borrowers.

2.6                               Each
of the Borrowers declares that it is and will, throughout the Security Period,
remain a principal debtor for all amounts owing under this Agreement and
neither of the Borrowers shall in any circumstances be construed to be a surety
for the obligations of the other Borrower hereunder.

2.7                               Until
all sums owing to the Creditor Parties by the Borrowers under this Agreement
and the other Finance Documents have been paid in full neither of the Borrowers
(hereinafter called “Creditor Borrower”) will without the prior written consent
of the Agent ask, demand, sue for, take or receive from the other Borrower or
any other member of the Group (hereinafter called “Debtor Borrower’) by set-off
or any other manner the whole or any part of all present and future sums,
liabilities and obligations payable or owing by the Debtor Borrower to the
Creditor Borrower whether actual or contingent jointly or severally or
otherwise howsoever (such sums being hereinafter called the “Subordinated
Liabilities”) so long as any Senior Liabilities are outstanding to the Banks
(for which purpose “Senior Liabilities” shall mean all present and future sums,
liabilities and obligations whatsoever payable or owing by the Borrowers (or
either of them) pursuant to the Finance Documents or any of them or otherwise
whatsoever, whether actual or contingent jointly or severally or otherwise
howsoever).

2.8                               The
Creditor Parties may, but will not be bound to, enquire as to the proposed or
actual application of an Advance, but will not be bound to monitor or verify
that application or be responsible for, or for the consequences of, that
application.

3                                         AVAILABILITY—COMMITMENTS BY THE BANKS—POSITION OF THE
BANKS AND THE INSTRUCTING GROUP

 

19

 

3.1                               Subject
as herein provided each Advance is available to the Borrowers for drawing until
its Applicable Availability Date. Any Advance or any part thereof which remains
undrawn at the close of business in Athens on its Applicable Availability Date
shall be automatically cancelled.

3.2                               The
Banks severally agree with the Borrowers to make the Facility available in the
proportionate amount of their Commitments to the Total Commitments on the terms
and conditions set out in this Agreement. In the event that any Bank fails to
make available its Commitment in respect of any Advance neither the Agent, nor
any other Creditor Party shall be liable to the Borrowers to make available all
or any part of such Commitment nor to compensate the Borrowers for such
failure.

3.3                               Notwithstanding
any other term of this Agreement, the interests of the Banks and the L/C Bank
under this Agreement and the L/C Facility Agreement are several and the
aggregate of the amounts outstanding at any time hereunder or under the L/C
Facility Agreement or under the other Finance Documents from the Borrowers to
each Bank or the L/C Bank (as the case may be) is a separate and independent
debt; accordingly each Bank and the L/C Bank shall be entitled to sue for any
amount which has become due and payable by the Borrowers to it under this
Agreement and the L/C Facility Agreement without joining the Arranger, the
Agent, the Security Trustee or any other Bank as additional parties in the
proceedings.

3.4                               However,
without the prior consent of the Instructing Group, a Bank or the L/C Bank may
not bring proceedings in respect of:

(a)                                  any
other liability or obligation of any Security Party under or connected with a
Finance Document; or

(b)                                  any
misrepresentation or breach of warranty by any Security Party in or connected
with a Finance Document.

3.5                               The
obligations of the Banks and the L/C Bank under this Agreement, the L/C
Facility Agreement and the other Finance Documents are several; and a failure
of a Bank or the L/C Bank to perform its respective obligations under this
Agreement or the L/C Facility Agreement or any other Finance Documents shall
not result in:

(a)                                  the
obligations of the other Banks or the lic Bank being increased; nor

(b)                                  any
Security Party or any other Bank or the L/C Bank being discharged (in whole or
in part) from its obligations under any Finance Document;

and
in no circumstances shall a Bank or the L/C Bank have any responsibility for a
failure of another Bank to perform its obligations under this Agreement or any
other Finance Documents.

3.6                               Every
Bank, the L/C Bank and each Security Party shall be bound by:

(a)                                  any
determination made, or action taken, by the Instructing Group under any
provision of a Finance Document;

(b)                                  any
instruction or authorisation given by the Instructing Group to any Servicing
Bank under or in connection with any Finance Document;

(c)                                  any
action taken (or in good faith purportedly taken) by the Servicing Bank in
accordance with such an instruction or authorisation.

3.7                               However,
the Borrowers and each other Security Party:

(a)                                  shall
be entitled to assume that the Instructing Group has duly given any instruction
or authorisation which, under any provision of a Finance Document, is 

 

 

20

 

required in relation to any
action which the Servicing Bank has taken or is about to take; and

(b)                                  shall
not be entitled to require any evidence that such an instruction or
authorisation has been given.

3.8                               In
Clauses 3.6 and 3.7 references to action taken include (without limitation) the
granting of any waiver or consent, an approval of any document and an agreement
to any matter.

3.9                               Nothing
contained in this Agreement and no action taken by the Creditor Parties
pursuant to this Agreement or under the other Finance Documents shall be deemed
to constitute the Creditor Parties as a partnership, association, joint venture
or other entity.

4                                         NOTICE OF DRAWDOWN

4.1                               The
Borrowers may make a request for an Advance by
sending to the Agent a duly completed Notice of Drawdown subject to
the conditions in this Clause 4.

4.2                               All
Advances shall be subject to the following conditions being complied with to
the Agent’s and the Security Trustee’s satisfaction-

4.2.1                                             on
the Drawdown Date of an Advance the conditions precedent set out in Clause 16
in respect thereof shall have either been satisfied or have been waived by the
Security Trustee acting with the authorisation of all Banks {whether with or
without conditions) and the undertakings in Clause 19 so far as they are
relevant on such Drawdown Date have at all times been complied with; and

4.2.2                                             on
the date of a Notice of Drawdown and on the relevant Drawdown Date of that
Advance no Event of Default or Potential Event of Default has occurred and is
continuing or might result from the relevant Advance being paid to the
Borrowers; and

4.2.3                                             on
each date of a Notice of Drawdown the representations and warranties set out in
Clause 14 and the other Security Documents are true and correct; and

4.2.4                                             the
Agent shall have received a Notice of Drawdown not later than 11.00 a.m.
(London time) on the third (3rd) Business Day prior to the relevant Drawdown
Date (or such shorter period as may be agreed by the Agent) from the Borrowers
setting out such proposed Drawdown Date.

4.3                               A
Notice of Drawdown once made shall be irrevocable.

5                                         INTEREST

5.1                               On
each Interest Payment Date the Borrowers shall pay to the Agent for the account
of the Banks for the period elapsed accrued interest at the Interest Rate on
the amount of each Advance in Euros.

5.2                               Interest
shall be calculated on the basis of the actual number of days elapsed and a
three hundred and sixty (360) day year or on such basis as the Agent may
determine in accordance with market practice.

5.3                               Each
determination of an Interest Rate hereunder shall be made by the Agent on each
day on which quotations would ordinarily be given by leading banks in the
European Interbank market for deposits in Euros for delivery on the first day
of the relevant Interest Period and shall be promptly notified by the Agent to
the Borrowers and the Banks.

6                                         INTEREST PERIODS

 

 

21

 

6.1                               Subject
to Clause 6.2, the Interest Periods shall be periods of a duration of three
(3), six (6) or nine (9) months (or such other periods as the Banks and the
Borrowers may agree) as selected by the Borrowers by written notice to be
received by the Agent not later than 11.00 a.m. (London time) on the relevant
Nomination Date.

6.2                               Notwithstanding
the provisions of Clause 6.1:

6.2.1                                             Subject
to the provisions of Clause 6.2.5, the initial Interest Period in respect of the
Advance first to occur under each Tranche shall commence on the Drawdown Date
thereof and shall end on the expiry date thereof and the initial Interest
Period in respect of any subsequent Advance in respect of the relevant Tranche
shall commence on the Drawdown Date thereof and shall end on the last day of
the then current Interest Period in respect of the Advance or Advances
previously drawn down in respect of that Tranche and upon expiration of the
first Interest Period of the Advance last to occur in respect of a Tranche, all
Advances in respect of such Tranche shall be consolidated into and shall be
treated in all respects as a single Advance and each subsequent Interest Period
for such consolidated single Advance shall commence on the expiry of the preceding
Interest Period in respect thereof;

6.2.2                                             if
any Interest Period would otherwise end on a day which is not a Business Day,
that Interest Period shall be extended to the next succeeding day which is a
Business Day unless such next succeeding Business Day falls in another calendar
month in which event the Interest Period shall end upon the immediately
preceding Business Day;

6.2.3                                             if
any Interest Period commences on the last Business Day in a calendar month or
if there is no numerically corresponding day in the month in which that
Interest Period ends, that Interest Period shall end on the last Business Day
in that later month;

6.2.4                                             no
Interest Period shall extend beyond the Final Maturity Date; and

6.2.5                                             if
the Borrowers fall to select an Interest Period in accordance with the above,
such Interest Period shall be of three (3) months duration or of such other
duration as the Agent may in its sole discretion select.

7                                         SUBSTITUTE BASIS

7.1                               If
a Bank determines (which determination shall be conclusive) that-

7.1.1                                             at
11.00 a.m. (London time) on any Interest Determination Date such Bank was not
being offered by banks in the European Interbank Market deposits in Euros in
the required amount and for the required period; or

7.1.2                                             such
deposits are not available by reason of circumstances affecting the European
Interbank Market; or

7.1.3                                             such
deposits are not available to such Bank in such market; or

7.1.4                                             adequate
and reasonable means do not or will not exist for such Bank to obtain or

ascertain the Interest Rate applicable to the next succeeding Interest Period;
or

7.1.5                                             Euros
will or may not be freely transferable,

then,
and in any such case the Agent shall give notice of any such event to the
Borrowers and, in case any of the above occurs on the Interest Determination
Date prior to a Drawdown Date the Borrowers’ right to borrow the part of the
Facility which remains available for borrowing shall be suspended during the
continuation of such circumstances.

7.2                               If,
however, any of the events described in Clause 7.1 occurs on any other Interest
Determination Date relative to the Facility or any part thereof, then the
duration of the 

 

 

22

 

relevant Interest Period shall
be up to one (1) month and during such Interest Period the Interest Rate
applicable to the Facility or the relevant part thereof shall be the rate per
annum determined by the Banks rounded upwards to the nearest whole multiple of
one sixteenth per cent (1/16th%) to be the aggregate of the Applicable Margin
and the cost (expressed as a percentage rate per annum) to the Banks of funding
the amount of the Facility or the relevant part thereof during such Interest
Period.

7.3                               During
such Interest Period the Borrowers and the Banks shall negotiate in good faith
in order to agree an Interest Rate and Interest Period satisfactory to the
Borrowers and the Banks to be substituted for those which but for the
occurrence of any such event as specified in this Clause would have applied. If
the Borrowers and the Banks are unable to agree on such an Interest Rate and
Interest Period by the day which is two (2) Business Days before the end of the
Interest Period referred to above, the Borrowers shall repay the Facility
together with accrued interest thereon at the Interest Rate set out above
together with all other amounts due under this Agreement but without any
prepayment fee, on the last day of such Interest Period.

8                                         PREPAYMENT

8.1                               The
Borrowers shall be obliged to prepay such part of the Facility as provided in
Clause 8.2 herebelow together with interest and all other sums due to the
Creditor Parties in respect of such part of the Facility if a Mortgaged Vessel
(i) is sold or the Shipbuilding Contract for that Vessel is assigned,
transferred, sold or novated to and in favour of any person (the “Sale
Reduction”) or (ii) becomes a Total Loss or (iii) the Mortgage over such
Mortgaged Vessel is discharged pursuant to paragraph (c) herebelow as follows:

(a)                                  in
the case of a Sale Reduction on or before the date on which either (i) the
delivery of the relevant Mortgaged Vessel to its buyer or (ii) the assignment,
transfer, novation or sale of the Shipbuilding Contract for the relevant Vessel
is completed or;

(b)                                  in
the case of the Total Loss on the earlier of (i) the date falling 180 days
after the date of the occurrence of such Total Loss and (ii) the date of
receipt by the Security Trustee of the proceeds of insurance relating to such
Total Loss; or

(c)                                  in
the case that a Mortgage over a Mortgaged Vessel is discharged (other than in
the circumstances referred to in paragraph (a) above and where the Borrowers
and the other Security Parties have discharged, all their obligations under the
Finance Documents) on or before the date of such Mortgage is discharged.

8.2                               In
case that any of the events referred to in Clause 8.1 occurs in respect of a
Vessel prior to the Final Availability Date, the Borrowers shall be obliged to
prepay the Tranche relevant to such Vessel in full, whereas in case that any
such event occurs after the Final Availability Date, the Borrowers shall be
obliged to prepay the higher of (i) the Tranche related to such Vessel in full
and (ii) a part of the Facility equal to the Relevant Amount.

8.3                               For
the purposes of Clause 8.2, the following terms shall have the following
meanings:

(a)                                  the
term “Relevant Amount” shall mean an amount in Euros equal to the higher of

(A)                              such
amount as shall ensure that immediately after such prepayment, the Security
Value shall not be less than the Security Requirement; and

(B)                                such
amount as shall ensure that X is not lower than Y,

(b)                                  “X”
is the ratio (expressed as a percentage) of

(A)                              the
market value of the Mortgaged Vessel other than the Mortgaged Vessel lost or
sold as determined in accordance with Clause 17.1;

 

 

23

 

 

(B)                                to
the aggregate amount of the Facility after deducting the amount of the relevant
prepayment,

immediately after the relevant prepayment is made; and

(c)                                  “Y”
is the ratio (expressed as a percentage) of

(A)                              the
market value of the Mortgaged Vessels (including the Mortgaged Vessel lost or
sold) as determined in accordance with Clause 17.1

(B)                                to
the aggregate amount of the Facility without deducting the amount of the
relevant prepayment,

immediately before the relevant prepayment is made.

8.4                               For
the purposes of this Agreement, a Total Loss shall be deemed to have occurred:

(a)                                  in
the case of an actual total loss of a Mortgaged Vessel, on the actual date and
at the time a Mortgaged Vessel was lost or if such date is not known, on the
date on which a Mortgaged Vessel was last reported;

(b)                                  in
the case of a constructive total loss of a Mortgaged Vessel, upon the date and
at the time notice of abandonment of a Mortgaged Vessel is given to the
insurers of a for the time being (provided a claim for such total loss is
admitted by such insurers) or, if such insurers do not admit such a claim, or,
in the event that such notice of abandonment is not given by the Owner thereof
to the insurers of such Mortgaged Vessel, on the date and at a time on which
the Incident which may result, in such Mortgaged Vessel being subsequently
determined to be a total loss has occurred;

(c)                                  in
the case of a compromised or arranged total loss of a Mortgaged Vessel, on the
date upon which a binding agreement as to such compromised or arranged total
loss has been entered into by the insurers of such Mortgaged Vessel; or

(d)                                  In
the case of Compulsory Acquisition of a Mortgaged Vessel, on the date upon
which the relevant requisition of title or other compulsory acquisition occurs;
and

(e)                                  in
the case of hijacking, theft, condemnation, capture, seizure, arrest, detention
or confiscation of a Mortgaged Vessel (other than where the same amounts to
Compulsory Acquisition of such Mortgaged Vessel by any Government Entity, or by
persons purporting to act on behalf of any Government Entity) which deprives
the Owner thereof of the use of the such Mortgaged Vessel for more than thirty
days, upon the expiry of the period of thirty (30) days after the date upon
which the relevant hijacking, theft, condemnation, capture, seizure, arrest,
detention or confiscation occurred.

8.5                               On
giving not less than thirty (30) days’ prior written notice to the Agent the
Borrowers may prepay all or any part of a Tranche (but if in part the amount to
be prepaid shall be €500,000 or a multiple thereof) at the end of the then
current Interest Period. The Borrowers shall obtain any consent or approval
from the relevant authorities that may be necessary to make any such prepayment
of a Tranche or part thereof and if it fails to obtain and/or comply with the
terms of such consent or approval and in consequence thereof the Banks have to
repay the amount prepaid or the Banks incur any penalty or loss then the
Borrowers shall indemnify the Banks forthwith against all amounts so repaid
and/or against all such penalties and losses incurred.

8.6                               Prepayments
made under Clause 8.1 in respect of a Vessel shall first be applied as follows:
(a) if made prior to the Final Availability Date: (i) towards prepayment in
full of the Tranche relating to such Vessel and (ii) unless an Event of Default
has occurred, the balance (after making the payment referred to in
sub-paragraph (i) above) shall be 

 

 

24

 

released to the Borrowers and
(b) if made after the Final Availability Date: firstly towards prepayment in
full of the Tranche relating to such Vessel and secondly if required under
Clause 8.2 towards prepayment of the Repayment Instalments and the Balloon
Instalment of the other Tranche on a pro rata basis and/or thirdly any balance
shall be released to the Borrowers.

8.7                               Prepayments
under Clause 8.5 in respect of a Tranche shall be applied in reducing the
Repayment Instalments and the Balloon Payment of such Tranche in inverse order
of maturity.

8.8                               Any
prepayment of the Facility made or deemed to be made under this Agreement
shall, be made together with accrued interest and any other amount payable in
accordance with Clauses 12 and/or 24 and/or 25 and (if made otherwise, than at the
end of an Interest Period relative to the amounts prepaid) such additional
amount (if any) as the Agent may certify as necessary to compensate the
Creditor Parties for any Broken Funding Costs incurred or to be incurred by
them as a result of such prepayment.

8.9                               Any
notice of prepayment given by the Borrowers under this Agreement shall be
irrevocable and the Borrowers shall be bound to prepay in accordance with each
such notice.

8.10                        The
Borrowers may not prepay all or any part of the Facility except in accordance
with the express terms of this Agreement

9                                         APPLICATION OF PROCEEDS AND EARNINGS

9.1                               Save
as provided in Clause 9.1.4, all Proceeds received by the Agent and/or the Security Trustee shall,
notwithstanding anything to the contrary whether express or Implied in any of
the Finance Documents, be applied as follows:

9.1.1                                             first,
toward reimbursing each Creditor Party in respect of all losses, costs,
charges, fees (including without limitation legal fees and fees due to the
Banks and/or the Security Trustee and/or the Agent under Clause 23) including
interest thereon that they have incurred in connection with the exercise of its
respective powers under the Finance Documents.

9.1.2                                             second,
to the Banks in respect of the amount lent and owing hereunder including
Interest thereupon and if the Proceeds are insufficient to pay such amounts
then unless otherwise agreed between the Banks, the Banks shall each receive a
proportion of the Proceeds in the proportionate amount of their Commitment
under the Facility and shall be applied by the Banks first against interest and
then against principal;

9.1.3                                             third,
to the Creditor Parties (other than the L/C Bank) in respect of all other
amounts which may be owing to such Creditor Parties under this Agreement and
any of the Finance Documents Including, but not limited, to Broken Funding
Costs;

9.1.4                                             fourth,
to the L/C Bank In respect of any amounts which may be owing to it under the
L/C Facility Agreement provided however that any and all monies received by the
Agent and/or the L/C Bank held in the Cash Collateral Account under the other
Accounts’ Charge shall first be applied towards any amounts due to the L/C Bank
under the L/C Facility Agreement and the L/C Bank shall be entitled to exercise
its rights thereunder at such time and in such manner as it deems appropriate
in its sole discretion without consulting with or obtaining the consent of any
other Creditor Party and in order to exercise such rights to give any and all
necessary instructions to the Agent provided however that after payment in full
of all amounts due to the L/C Bank under the L/C Facility Agreement any
remaining balance shall be applied towards any amounts due to the other
Creditor Parties under this Agreement; and

 

 

25

 

 

9.1.5                                             fifth,
once the Indebtedness has been repaid to the Creditor Parties to the full
satisfaction of the Agent and the Security Trustee, any balances shall be paid
to the Borrowers.

9.2                               The
Agent may, with the authorisation of all the Banks (and, In the case of an
application pursuant to Clause 9.1.4 of the L/C Bank) by notice to Borrowers,
the other Security Parties and the other Creditor Parties provide for a
different manner of application from that set out in Clause 9.1 either as regards
a specified sum or sums or as regards sums in a specified category or
categories.

9.3                               The
Agent may give notices under Clause 9.2 from time to time in respect of sums
which may be received or recovered in the future.

9.4                               This
Clause 9 and any notice which the Agent gives under Clause 9.2 shall override
any right of appropriation possessed, and any appropriation made, by a Borrower
or any other Security Party.

9.5                               If
any Proceeds recovered by any Creditor Party have to be repaid by such Creditor
Party on the ground of unfair or fraudulent preference or on any other ground,
the Creditor Party shall have the same rights hereunder and/or under the other
Finance Documents against the Borrowers as if such amounts had never been
applied in payment of the Indebtedness.

9.6                               The
Borrowers covenant to ensure and procure that all the Earnings shall be
assigned to the Security Trustee and shall be paid into the Earnings Account
which shall be charged to the Creditor Parties pursuant to the Accounts Charge
Agreement Unless and until the Security Trustee gives notice to the Borrowers
that it requires that all Earnings be paid directly to the Security Trustee
(which notice may only be given by the Security Trustee if an Event of Default
or Potential Event of Default has occurred), all amounts in the Earnings
Account shall be applied as follows-

9.6.1                                             first,
towards the payment of fees and costs and any other sums that are due and
payable by the Borrowers to the Creditor Parties;

9.6.2                                             second,
towards payment to the Retention Account of the amounts required to be
transferred to the credit thereof in accordance with Clause 21; and

9.6.3                                             third,
any balance thereafter remaining in the Earnings Account shall be available to
the Borrowers.

10                                  REPAYMENT

10.1                        Subject
to the other provisions of this Agreement each Tranche shall be repaid by the

Borrowers to the Banks as follows:

(a)                                  by
forty (40) consecutive quarterly Repayment Instalments, with the first twelve
(12) such instalments being in the amount of One hundred and Fifty thousand
Euros (€150,000) each and the remaining twenty eight (28) such instalments
being in the amount of One hundred and Ten thousand Euros (€110,000) each, and
each one such instalment to be repaid on each of the Repayment Dates for the
relevant Tranche; and

(b)                                  by
a final payment of One million Seven hundred Seventy thousand Euros (€
1,770,000).

10.2                        If
the Total Commitments in respect
of either Tranche are not drawn down in full, the amount of the Repayments
Instalments and the Balloon Payment in respect of that Tranche shalt be reduced
proportionately.

10.3                        Any
amounts repaid or prepaid under
this Agreement may not be reborrowed.

 

 

26

 

11                                  EVIDENCE OF DEBT

The
Agent, the Security Trustee, each Bank and the L/C Bank shall maintain in
accordance with their usual practice accounts evidencing the amounts from time
to time lent and/or guaranteed and/or owing hereunder or under the L/C
Agreement and in any legal action or proceedings
arising out of or in connection with
this Agreement and/or the L/C Facility Agreement and/or the other Finance
Documents the entries made in such, accounts shall be conclusive evidence
(absent manifest error) of the existence and the amounts of the liabilities of
the Borrowers hereunder and/or thereunder.

12                                  PAYMENTS—SET OFF-PRO RATA SHARING OF PAYMENTS

12.1                        All
amounts payable under this Agreement and/or the other Finance Documents by the
Borrowers, including amounts payable under this Clause 12, shall be paid
in full to the Agent on behalf of the Creditor Parties without set-off or
counterclaim or retention and free and clear of and without any deduction or
withholding for or on account of any Taxes or any charges or otherwise present
or future. In the event that the Borrowers are required by law to make any such
deduction or withholding from any payment hereunder, then the Borrowers shall
forthwith pay to the Agent such
additional amount as will result in the immediate receipt by the Agent of the
full amount which would have been received hereunder had no such deduction or
withholding been made and the Borrowers shall immediately forward to the Agent
official receipts of the relevant taxation or other authority or other evidence
acceptable to the Agent of the amount deducted or withheld as aforesaid,
provided that in the event that it shall be illegal for the Borrowers to pay
such additional amount as is referred to in this Clause 12.1 then the
Indebtedness shall be repayable by the Borrowers to the Creditor Parties on
demand. Nothing in this Clause 12.1 shall interfere with the right of the Agent
or the Banks to arrange their respective tax affairs in whatever manner they think fit.

12.2                        All
payments which are to be made in Euros by the Borrowers under this Agreement
and/or the other Finance Documents shall be made in Euros in immediately available and freely
transferable and convertible funds not later than 11 a.m. (Brussels time) on
the date upon which the relevant payment is due to such bank and as the Agent may from time to time nominate
by written notice to the Borrowers;

12.3                        In
the event of a failure by the Borrowers to pay any amount on the date on which
such amount is due and payable pursuant to this Agreement and/or the L/C
Facility Agreement and/or the other Finance Documents and irrespective of any
notice by the Agent or any other person to the Borrowers in respect of such
failure, the Borrowers shall pay interest on such amount on demand from the
date of such failure up to the date of actual payment (as well after as before
judgment) at the Default Rate for such period as the Agent may select at or
about 11.00 a.m. (Brussels time) on the Business Day immediately following that
on which the Agent becomes aware of the failure and, for so long as the failure
continues, at such rate as shall be recalculated on the same basis thereafter.
Any interest which shall have accrued under this Clause 12.3 in respect of an
unpaid sum shall be due and payable and shall be paid by the Borrowers at the
end of the period by reference to which it is calculated or such other date or
dates as the Agent may specify by written notice to the Borrowers.

12.4                        Without
limitation to Clause 9 and subject to Clause 12.5 the Agent shall pay promptly
to the order of each Bank, its Proportionate Share of every sum of money
received by the Agent pursuant to the Finance Documents and shall pay promptly
to the order of each Creditor Party every other sum of money received by the
Agent pursuant to the Finance Documents and which may be due to that Creditor
Party and until so paid each such amount shall be held by the Agent on trust
absolutely for that Lender or Creditor Party, as the case may be.

12.5                        Any
amounts payable pursuant to Clause 23 and any amounts which, by the terms of
the Finance Documents or any of them, shall be paid to the Agent for the
account of the Agent alone or, as the context may require, specifically for the
account of one or more of 

 

 

27

 

the Creditor Parties shall not
be distributed in accordance with Clause 12.4 but will be held by the Agent for
its own benefit or as the context may require transferred by the Agent to the
relevant Creditor Party.

12.6                        Without
prejudice to the foregoing and irrespective of any notice by the Agent or any
other person to the Borrowers in respect of the Borrowers’ failure to make any
payment when due, the Borrowers shall indemnify each Creditor Party against any
damages, losses or expenses (including losses incurred in paying overdraft
interest or in liquidating or employing deposits from third parties acquired to
make, fund or maintain the Commitment of each Bank or the Facility or any part
thereof) which the Creditor Parties or any of them may sustain or incur as a
consequence of the failure by Me Borrowers to pay any amount when due and
payable under this Agreement and/or the Security Documents and/or as a
consequence of the occurrence of any Event of Default. Furthermore the
Borrowers undertake to indemnify each Creditor Party against any loss incurred
by the Creditor Parties or any of them as a result of any judgment or order
being given or made for the payment of any amount due under this Agreement
and/or the L/C Facility Agreement and/or the other Finance Documents and such
judgment or order being expressed in a currency other than that in which the
payment was due or payable under this Agreement and/or the L/C Facility
Agreement and/or the other Finance Documents and as a result of any variation
having occurred in rates of exchange between the date on which the currency is
converted for the purpose of such judgment or order and the date of actual
payment thereof. This indemnity shall constitute a separate and independent
liability of the Borrowers and shall continue in force and effect
notwithstanding any such judgment or order as aforesaid.

12.7                        My
prepayment or repayment of principal made or deemed to be made under this
Agreement shall, if made otherwise than at the end of an Interest Period
relative to the amounts prepaid or repaid, be made together with accrued interest
thereon and such additional amount (if any) as the Agent may certify as
necessary to compensate the Creditor Parties for any damages or losses, as the
case may be, incurred or to be incurred by the Banks in connection with such
prepayment or repayment (including but not limited to losses on account of
funds borrowed in order to make, fund or maintain the Commitment or the
Facility or any part thereof prepaid or repaid).

12.8                        If
the Borrowers give a Notice of Drawdown pursuant to Clause 4 and the Banks make
arrangements on the basis of such notice to acquire Euros in the European
Interbank Market to fund the Advance(s) or any part thereof and the Borrowers
are not permitted or otherwise fail to borrow in accordance with such Notice of
Drawdown (either on account of any condition precedent not being fulfilled or
otherwise) the Borrowers shall indemnify the Banks against any damages, losses
or expenses which the Banks may incur (either directly or Indirectly) as a
consequence of the failure by the Borrowers to borrow in accordance with the
Notice of Drawdown.

12.9                        Each
Creditor Party may without prior notice but following the occurrence of an
Event of Default which Is continuing:

(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 Borrowers at any office in any country of that
Creditor Party in or towards satisfaction of any sum then due from the
Borrowers to that Creditor Party under any of the Finance Documents; and

(b)                                  for
that purpose:

(a)                                break, or alter the maturity of, all or
any part of a deposit of the Borrowers;

(b)                               convert or translate all or any part of a
deposit or other credit balance into Euros; and/or

 

 

28

 

(c)                                enter into any other transaction or make
any entry with regard to the credit balance which the Creditor Party concerned
considers appropriate.

12.10                 No
Creditor Party shall be obliged to exercise any of its rights under Clause
12.9; 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 a Creditor Party is entitled (whether under the general law or any
document).

12.11                 For
the purposes of Clauses 12.9 and 12.10, a sum payable by the Borrowers to the
Agent or the Security Trustee for distribution to, or for the account of, a
Bank shall be treated as a sum due to that Bank; and each Bank’s proportion of
a sum so payable for distribution to, or for the account of, the Banks shall be
treated as a sum due to such Bank.

12.12                 Save
as provided in Clause 9.1.4, if any Creditor Party at any time shall receive or
recover from the Borrowers or any other Security Party pursuant to this
Agreement or other Finance Documents (whether by way of voluntary or
involuntary payment, by virtue of an exercise of its legal rights including,
but not limited, to any right of set-off, counterclaim or otherwise howsoever)
the whole or any part of any amounts due from the Borrowers to such Creditor
Party hereunder otherwise than by distribution from the Agent under the terms
of this Agreement, then:

(a)                                  such
Creditor Party (hereinafter called the “Paying Creditor Party”) shall (and is
hereby irrevocably authorised to that effect by the Borrowers) promptly and, in
any event after five (5) Banking Days of such receipt or recovery, pay to the
Agent the full amount or (as the case may be) an amount equal to the equivalent
of the full amount so received or recovered after deducting any expenses
incurred by the Paying Creditor Party, in obtaining such amounts:

(b)                                  as
between the Borrowers on the one hand and the Paying Creditor Party on the
other, the Borrowers shall (save to the extent of any amount available for
distribution to the Paying Creditor Party pursuant to Clause 12.12(c)) remain
or again become indebted to the Paying Creditor Party as the case may be
hereunder in the amount so paid as if it had not been received or recovered as
aforesaid; and

(c)                                  the
Agent shall treat the amount so paid as if it were a payment by the Borrowers
on account of amounts due from the Borrowers hereunder for distribution to the
Paying Creditor Party and the other Creditor Parties in the proportions in
which the Paying Creditor Party and the other Creditor Parties would have been
entitled to receive such amount had it been paid by the Borrowers.

13                                  CHANGE OF CIRCUMSTANCES

13.1                        If—

13.1.1                                      any
law, regulation, treaty or official directive (whether or not having the force
of law) or the interpretation thereof by any authority charged with the
administration thereof (of which the Banks at the date of execution of this
Agreement are not aware):

(a)                                  subjects any Bank and/or any holding
company thereof to any Tax with respect to payments of principal or interest in
connection with the Facility or any other amount payable hereunder (other than
Tax assessed, levied or collected on the overall net income of such Bank); or

(b)                                 changes the basis of Taxation of payments
to any Bank and/or any holding company thereof of principal or interest in connection
with the Facility or of any other amount payable hereunder (other than a change
in the rate of Tax on the overall net income of such Bank); or

 

 

29

 

(c)                                  imposes, modifies or deems applicable any
reserve and/or special deposit requirements against or in respect of assets or
liabilities of, or deposits with or for the account of, or loans or credit
extended by, any office of any Bank; or

(d)                                 imposes on any Bank any other condition
affecting this Agreement, its Commitment or the Facility or any part thereof or
its funding; or

13.1.2                                      any
Bank complies with any request, law, regulation or directive from any
applicable fiscal or monetary authority (whether or not having the force of
law), and as a result of any of the foregoing either directly or indirectly-

(a)                                  the cost to any Bank of making, funding
or maintaining its Commitment in respect of the Facility or any part thereof is
increased; or

(b)                                 the amount of principal, Interest or
other amount payable to any Bank or the effective return to such Bank hereunder
is reduced; or

(c)                                  any Bank makes any payment or loses any
interest or other return calculated by reference to the gross amount of any sum
receivable by it from the Borrowers hereunder,

then and in each such case upon demand from time to time the Borrowers
shall pay to the Agent for the account of the relevant Bank such amount as
shall compensate the relevant Bank for such increased cost, reduction, payment
or lost interest or other return. If such Bank is entitled to make a claim
pursuant to this Clause 13 the Agent shall notify the Borrowers of the event by
reason of which they are so entitled. The Agent shall submit to the Borrowers a
certificate setting out details of the event giving rise to such compensation,
the amount thereof and the manner in which it has been calculated and in the
absence of manifest error such certificate shall be conclusive.

Provided
however that for the purposes of this Clause 13.1 the word “regulation” shall
be deemed to include any regulation which relates to capital adequacy or
liquidity controls or which affects the manner in which the relevant Bank
allocates capital resources to its obligations under this Agreement (including,
without limitation, the implantation of any regulations which may replace those
set out in the statement of the Basle Committee on Banking Regulations and
Supervisory Practices dated July 1998 and entitled “International Convergence
of Capital Measurement and Capital Structures”) which is introduced, or
altered, or the interpretation or application of which is altered, after the
date of this Agreement;

13.2                        If
any amount payable by the Borrowers hereunder and/or under the L/C Facility
Agreement and/or under the other Finance Documents whether in respect of
principal, interest or otherwise or any recipient of any such amount by reason
of its receiving such amount is or becomes subject at any time to Taxation in
any relevant jurisdiction, the Borrowers will indemnify any such recipient of
such amount in respect of such Tax liability so that such recipient receives or
retains a net sum equal to the amount it would have received or retained had
there been no such Tax liability but if such recipient shall be or becomes
entitled to any Tax credit or relief in respect of any such Tax liability or
deduction and if the recipient in its sole determination actually receives (and
is entitled to retain) a benefit from such Tax credit or relief in its country
of domicile, incorporation or residence, that recipient shall, subject to any
laws or regulations applicable thereto, pay to the Borrowers after such benefit
is effectively received by that recipient such amount (which shall be
conclusively certified by that recipient) as shall ensure that the net amount
actually retained by that recipient is equal to the amount which would have
been retained if there had been no such
liability or deduction. In
addition the Borrowers shall indemnify the Bank and each recipient of any sum
payable by the Borrowers under this Agreement and/or under the Security
Documents against any liability for Taxes In the United Kingdom, the Federal
Republic of Germany or the
Republic of Greece or the Republic of Marshall Islands or the Republic of
Liberia or any other relevant jurisdiction, imposed on any of them or on any agent, branch, employee,
representative or representative office of 

 

 

30

 

any of them by virtue of the
negotiation, preparation or execution of
this Agreement and/or the other Finance Documents, the performance of
any duty or discharge of any
liability hereunder and/or under the other Finance Documents or the receipt of any payment
hereunder and/or under the other Finance Documents. Nothing in this Clause 13.2
shall interfere with the right of the Creditor Parties to arrange their
respective tax affairs in
whatever manner they think fit.

13.3                        Notwithstanding
anything to the contrary herein contained, if any change in law, regulation or treaty or in the interpretation or
application thereof by any authority charged with the administration thereof
shall make It unlawful for the Agent or any of the Banks to make, fund or maintain the
Commitment of any Bank or the Facility, the Agent may, by written notice
thereof to the Borrowers, declare that the Banks’ duty to provide the Borrowers
with the Commitment or the Facility shall be terminated forthwith whereupon the
Borrowers will prepay forthwith (or if permitted by law on the next following
Interest Payment Date) the Facility together with all interest accrued thereon
and all fees and other amounts payable to the Banks hereunder (including, but
not limited to, Broken Funding Costs). The Banks’ duties and liabilities
hereunder and their Commitment shall be cancelled on the giving of such notice.
In any such event, but without prejudice to the aforesaid liability of the
Borrowers to prepay the Facility, the Borrowers, the Agent and the Banks shall
negotiate in good faith with a view to agreeing the terms for making the
Facility available from another jurisdiction, or funding the Facility from
alternative sources, or otherwise
restructuring the Facility on a basis
which is not unlawful. If the said terms are not agreed within thirty (30) days
then the negotiations shall forthwith terminate.

14                                  REPRESENTATIONS AND WARRANTIES

14.1                        Each
of the Borrowers hereby represents and warrants to each Creditor Party that the
following matters are true at the time of this Agreement and warrants that they
shall remain true throughout the Security Period:

14.1.1                                      Each
of the Borrowers and the other Corporate Security Parties is a corporation duly
formed and validly existing under the laws of the country of its incorporation
and each of them has the power and authority to own its assets and carry on
business in each jurisdiction in which it owns assets or carries on business;

14.1.2                                      each
of the Borrowers and the other Security Parties has the power to enter into
this Agreement and into the other Subject Documents to which it/he is a party
and to perform and discharge its/his duties and liabilities hereunder and
thereunder and to borrow hereunder and it/he has taken all necessary action
(whether corporate or otherwise) required to authorise the execution, delivery
and performance of this Agreement and such other Subject Documents to which
it/he is a party and the borrowings to be made hereunder

14.1.3                                      the
execution, delivery and performance of this Agreement and the other Subject
Documents, will not violate or exceed the powers granted to each of the
Borrowers and any other Security Party by, or any provision of, any law or
regulation in any jurisdiction to which the Borrowers and any other Security
Party is subject, any order or decree of any governmental agency or court of or
in any jurisdiction to which the Borrowers or either of them and any other
Security Party is subject, the articles of incorporation and by-laws of each of
the Borrowers and the other Corporate Security Parties or any mortgage, deed,
contract or agreement to which the Borrowers or either of them is a party and
which is binding upon the Borrowers or either of them or any other Security
Party, as the case may be, or their assets, and will not cause any Encumbrance
to arise over or attach to all or any part of its revenues or assets nor
require the Borrowers or either of them or any other Security Party to create
any such Encumbrance other than any Encumbrance to be created hereunder;

14.1.4                                      all
consents, licences, approvals, registrations, authorisations or declarations
(including, without limitation, all foreign exchange approvals) in any
jurisdiction to which any Security Party is subject required to enable each
Borrower to borrow 

 

 

31

 

hereunder and each Security
Party to lawfully to enter into and perform and discharge its/his respective
duties and liabilities under this Agreement and the other Subject Documents to
which it/he is a party, to ensure that the duties and liabilities of the
Borrowers or either of them and the other Security Parties hereunder and
thereunder are legal, valid and enforceable in accordance with the terms of
this Agreement and the terms of the other Subject Documents respectively and to
make this Agreement and the Subject. Documents admissible in evidence in such
aforesaid jurisdictions, have been obtained or made and are in full force and
effect;

14.1.5                                      this
Agreement and each of the Subject Documents, constitute the legal, valid,
binding and unconditional duties and liabilities of the Borrowers or either of
them and the other Security Parties, which are parties thereto, enforceable
against such of the Borrowers and the other Security Parties, as are parties
thereto, in accordance with the terms thereof save as provided by any
bankruptcy, insolvency or similar laws of general application;

14.1.6                                      none
of the Borrowers and the other Security Parties has failed to pay when due any
material amount or to perform any material duty under the provisions of any
agreement relating to indebtedness to which it/he is a party or by which it/he
may be bound and no event has occurred and is continuing which constitutes, or
which with the giving of notice or lapse of time or both would constitute, a
material breach or default by the Borrowers or the other Security Parties or
any of them under any such agreement;

14.1.7                                      no
litigation or administrative proceedings before or of any court, arbitration
tribunal or governmental authority are pending or, to the knowledge of the
Borrowers, is threatened against the Borrowers, the other Security Parties or any
of them or their assets which might have a material adverse effect on the
business, assets or financial condition of the Borrowers or the other Security
Parties or any of them or the Borrowers’ or the other Security Parties’ ability
to perform and discharge their respective duties and liabilities hereunder and
under the other Subject Documents;

14.1.8                                      the
Financial Statements are complete and correct and present fairly the position
of the Borrowers and/or the Group as of such date and the results of the
operations of the Borrowers and/or the Group ended on such date, and have been
prepared in accordance with the Applicable Accounting Principles consistently
applied and give a true and fair view of the financial condition, assets and
liabilities of the Borrowers and/or the Group at the date to which such
Financial Statements have been prepared and since that date there has been no
adverse change in the financial conditions of the business, assets or operation
of the Borrowers and/or the Group, taken as a whole;

14.1.9                                      the
information provided to the Servicing Banks (or any of them) in relation to
this transaction is true and correct in all material respects and does not omit
any information necessary to make any of the information so provided not
misleading;

14.1.10                               each
of the Borrowers is a wholly-owned direct Subsidiary of AEGEAN SHIPHOLDINGS,
each of AEGEAN SHIPHOLDINGS and the Manager is a wholly-owned direct subsidiary
of AEGEAN PETROLEUM NETWORK and no less than 35% of all the issued voting share
capital of AEGEAN PETROLEUM NETWORK is ultimately beneficially owned by Mr.
Dimitrios Melissanidis, Mr. Peter Georgiopoulos and their respective immediate
families;

14.1.11                               it
is not necessary or advisable to ensure the legality, validity, enforceability
or admissibility in evidence of this Agreement and the other Subject Documents
(with the exception of the Mortgages) that any of them be filed, recorded or
enrolled with any governmental authority or agency or that they be stamped with
any stamp, registration or similar transaction tax;

 

 

32

 

14.1.12                               the
selection of English law to govern this Agreement is a valid and binding
selection and the submission to the jurisdiction of the High Court of Justice
in England is a valid and binding submission;

14.1.13                               none
of the Borrowers and the other Security Parties is entitled to claim any
immunity in relation to itself/himself or its/his assets under any law or in
any jurisdiction in connection with any legal proceedings, set-off or
counterclaim relating to this Agreement and the other Finance Documents to
which it/he is a party or in connection with the enforcement of any judgment or
order arising from such proceedings;

14.1.14                               no
Taxes are imposed by withholding or otherwise on any payment to be made by the
Borrowers or the other Security Parties under this Agreement or any other
Finance Document or any other document or agreement to be executed or delivered
pursuant hereto or thereto; and

14.1.15                               each
of the Borrowers, and the other members of the Group and their respective
directors, officers and employees are in full compliance with all Environmental
Laws which are currently applicable to its business and to all property owned
or occupied by it, and all applicable consents, permits, licences, approvals,
rulings, variations, exemptions or other authorisations required under laws of
that kind have been obtained, are in full force an effect and are being
complied with fully and there are no facts or circumstances entitling any of
the same to be revoked, suspended, amended, varied or withdrawn.

14.2                        The
Borrowers hereby further represent and warrant that:

14.2.1                                      on
the Drawdown Date of each Advance related to a Vessel, the Shipbuilding
Contract in respect of that Vessel and the Refund Guarantee issued in respect
thereof shall be in full force and effect and no event of default shalt have
occurred thereunder;

14.2.2                                      on
the Drawdown Date of each Additional Works’ Advance related to a Vessel the
Additional Works’ Contract in respect of that Vessel shall be in full force and
effect and no event of default shall have occurred thereunder,

14.2.3                                      on
the Drawdown Date of each Delivery Advance and each Additional Works’ Advance
relating to a Vessel the following matters will be true and shall remain true
until full payment of all amounts payable hereunder:

(a)                                  the
relevant Vessel will be duly registered in the name of its Owner under a flag
acceptable to the Banks;

(b)                                  the
relevant Vessel will be in the absolute and unencumbered ownership of the Owner
thereof, save as contemplated by this Agreement and the Finance Documents;

(c)                                  the
relevant Vessel will maintain the highest class with the Classification Society
free of all recommendations and qualifications of the Classification Society;

(d)                                  the
relevant Vessel will be operationally seaworthy;

(e)                                  the
relevant Vessel will comply with all relevant laws, regulations and
requirements (statutory or otherwise), including without limitation, the ISM
Code, and the ISM Code Documentation the ISPS Code and the ISPS Documentation
as are applicable to (i) ships registered under the law of the flag she is
flying and (ii) engaged in the same or a similar service as such Vessel is or
is to be engaged;

 

 

33

 

(f)                                    the
Mortgage relating to the relevant Vessel will have been duly recorded against
such Vessel as a valid first priority ship mortgage in accordance with the laws
of her flag;

(g)                                 the
relevant Vessel will be insured in accordance with the provisions of this

Agreement in respect of Insurances;

(h)                                 the
relevant Vessel will be managed by the Manager under the terms of the

Approved Management Agreement, relating thereto;

(i)                                    the
Owner of the relevant Vessel and the Manager will have complied with the
provisions of ail Environmental Laws in respect of that Vessel;

(j)                                    the
Owner of the relevant Vessel and the Manager will have obtained all
Environmental Approvals and will be in compliance with all such Environmental
Approvals in respect of that Vessel;

(k)                                the
Owner of the relevant Vessel and the Manager shall have not received any notice
of any Environmental Claim that alleges that either the Owner or the Manager is
not in compliance with any Environmental Law or any Environmental Approval in
respect of that Vessel;

(l)                                    there
shall be no Environmental Claim pending against either Owner and/or the Manager
and/or either Vessel;

(m)                              no
Environmental Incident shall have occurred which could or might give rise to
any Environmental Claim against either Owner and/or the Manager and/or either
Vessel; and

(n)                                 the
relevant Vessel will have unconditionally been delivered by the Builder to and
accepted by the Owner thereto pursuant to the relevant Shipbuilding Contract
and the full amount of the purchase price payable in respect thereof (including
any amount in addition to the part being financed hereunder) will have been
duly paid to the Builder.

14.3                        The
Borrowers hereby finally jointly and severally represent, warrant and confirm
to each other Party to this Agreement that:

14.3.1                                      each
Borrower enters into this Agreement for its own account and receives the
Facility or any part thereof for its sole benefit; and

14.3.2                                      each
Borrower will promptly inform the Creditor Parties (by written notice to the
Agent) if it is not, or ceases to be, such beneficiary and will then set down
in writing the name(s) and the address(es) of the relevant beneficiary(ies).

14.4                        The
representations and warranties of the Borrowers set out in Clause 14.1 and 14.2
and 14.3 above shall survive the execution of this Agreement and shall be
deemed to be repeated on each Drawdown Date and each Interest Payment Date with
respect to the facts and circumstances existing at each such time as if made at
such time.

15                                  SECURITIES

The
Borrowers hereby agree that the Finance Documents shall secure with first
priority the due payment of the Indebtedness.

16                                  CONDITIONS PRECEDENT

16.1                        Notwithstanding
the provisions of Clauses 3 and 4, the obligation of the Banks to make
available either Pre-Delivery Advance under this Agreement is subject to the
condition 

 

 

34

 

that the Security Trustee shall
have received the following documents or evidence in form and substance
satisfactory to the Security Trustee and its legal advisers on or prior to the
Drawdown Date of either Pre-Delivery Advance:

16.1.1                                      a
copy, certified as a true copy by the secretary of each Corporate Security
Party of the resolutions of the board of directors and of the shareholders of
each Corporate Security Party authorising the transaction contemplated hereby
and authorising a person or persons to sign or execute on behalf of each
Corporate Security Party this Agreement, the relevant Notice of Drawdown, the
Acknowledgement (as in the form of Schedule 4 hereof) and the other Finance
Documents as is a party thereto;

16.1.2                                      the
originals of any power or powers of attorney granted pursuant to Clause 161.1;

16.1.3                                      copies,
duly certified as a true copy by the respective secretaries of each Corporate
Security Party of the certificate of incorporation, the articles of
incorporation and by-laws of each Corporate Security Party and evidence
satisfactory to the Security Trustee that each Corporate Security Party is in
good standing;

16.1.4                                      a
list specifying the directors and officers of each Corporate Security Party
(together with their specimen signatures) and specifying the authorised and
issued share capital of each Corporate Security Party;

16.1.5                                      the
Corporate Guarantees duly executed by each Corporate Guarantor;

16.1.6                                      certified
copies of all documents (with a certified translation if an original is not in
English) evidencing any other necessary action (including but without
limitation governmental approval, consents, licences, authorisations,
validations or exemptions which the Security Trustee or its legal advisers may
require) required by the Security Parties or any of them with respect to this
Agreement and the other Finance Documents relating to the drawdown of the
Advances;

16.1.7                                      the
Cash Collateral Account Charge Agreement duly executed by the Borrowers and
each of the Earnings Accounts Charge Agreements duly executed by each relevant
Borrower

16.1.8                                      evidence
that each of the Accounts has been duly opened with the Agent and that all
board resolutions, mandates, signature cards and other documents or evidence
required in connection with the operating, maintenance and operation of such
accounts have been duly delivered to the Agent;

16.1.9                                      the
opinion letters from English, Greek and Marshall Islands legal counsels, all acceptable
to the Security Trustee and in form and substance satisfactory to all the Banks
in respect of this Agreement and the other Finance Documents;

16.1.10                               a
letter from Messrs. RICHES CONSULTING to the Security Trustee confirming
acceptance of their appointment as agents for service under Clause 36.4;

16.1.11                               payment
to the Agent of the fees referred to in sub-clause 23.1

16.1.12                               certified
copies of the Shipbuilding Contract and the Refund Guarantee first to be issued
together with such evidence as the Security Trustee and/or its legal advisers
shall require in relation to the due authorisation and execution (i) by the
Builder of each Shipbuilding Contract and all documents to be executed by the
Builder pursuant thereto and (ii) by the Refund Guarantor of such Refund
Guarantee;

16.1.13                               the
Assignments of the Shipbuilding Contracts and the Assignments of the Refund
Guarantees both duly executed by each Borrower and notices thereof,

16.1.14                               the
acknowledgements of receipt by the Builder and by the Refund Guarantor to the
Security Trustee of the notices of the Assignments of the Shipbuilding
Contracts and 

 

 

35

 

the Assignments of the Refund
Guarantee first to be issued in respect of each Vessel duly notarised;

16.1.15                               evidence
that the Manager has been appointed by technical supervisor under each
Shipbuilding Contract and has accepted its appointment;

16.1.16                               evidence
that all instalments and amounts payable under each Shipbuilding Contract prior
to the Drawdown Date of either Pre-Delivery Advance have been duly paid;

16.1.17                               certified
copies of the Additional Works’ Contracts together with such evidence as the
Security Trustee and its legal advisers shall require in relation the
authorisation and execution by IOTA of each Additional Works’ Contract and all
documents to be executed by IOTA pursuant thereto;

16.2                        The
agreement of the Banks and the L/C Bank to permit the release from the Cash
Collateral Account of any amount for payment of an Instalment in respect of a
Vessel as provided in Clause 2.3 shall be subject to the conditions referred to
in Clause 2.3 and to the further condition that the Security Trustee shall have
received the following documents or evidence in form and substance satisfactory
to the Security Trustee and its legal advisers on or prior to the date of such
release in respect of such Vessel:

16.2.1                                      in
respect of a Pre-Delivery Instalment certified copies of: (a) the confirmation
issued by the Classification Society evidencing the completion of the relevant
part of the relevant Vessel’s construction to the satisfaction of the
Classification Society; (b) the Builders invoice in respect of the relevant
Instalment; and (c) the relevant Refund Guarantee in respect of the relevant
Vessel duly issued and delivered to the Owner thereof any confirmation from the
Refund Guarantor that any Refund Guarantee(s) already in place remain(s) in
full force and effect; and (d) acknowledgement of receipt of the notice of
assignment of the relevant Refund Guarantee duly notarised;

16.2.2                                      in
respect of each Delivery Instalment certified copies of: (a) the confirmation
issued by the Classification Society evidencing the completion of the relevant
part of the relevant Vessel’s construction to the satisfaction of the Classification
Society; (b) the Builder’s invoice corresponding to such Instalment; (c) the
bill of sale in respect of the relevant Vessel; (d) a Builder’s certificate in
respect of the relevant Vessel; and (e) the protocol of delivery and acceptance
in respect of the relevant Vessel duly signed by the Builder and the Owner
thereof.

16.3                        The
agreement of the Banks to permit the drawdown of a Delivery Advance in respect
of a Vessel Is subject to the condition that the Security Trustee shall have
received (in addition to the documents and evidence referred to in Clauses 16.1
and 16.2 the following documents or evidence in form and substance satisfactory
to the Security Trustee and its legal advisers on or prior to the Drawdown Date
of such Advance in respect of that Vessel:

16.3.1                                      evidence
that the relevant Vessel is duly registered in the ownership of the Owner
thereof under a flag acceptable to the Banks, free from registered Encumbrances
other than the Mortgage to be registered thereon;

16.3.2                                      the
Vessel’s Security Documents in respect of the relevant Vessel duly executed by
the Owner thereof and the Mortgage duty registered with the appropriate flag
authorities;

16.3.3                                      the
notices of assignment of the Earnings and the Insurances of the relevant Vessel
duly signed by the Owner thereof;

16.3.4                                      evidence
that save for the Encumbrances created by the relevant Vessel’s Security
Documents there is no Encumbrance whatsoever on each relevant Vessel;

 

 

36

 

16.3.5                                      evidence
that the relevant Vessel is insured in accordance with the provisions of this
Agreement;

16.3.6                                      evidence
that the relevant Vessel is classed at the highest classification status with
her Classification Society;

16.3.7                                      certified
copies of the classification and international safety and trading certificates
of the relevant Vessel issued by the Classification Society of the relevant
Vessel free of overdue recommendations or other conditions or notations
affecting her class;

16.3.8                                      if
requested by the Banks, charter free market valuation of the relevant Vessel on
the basis of Clause 17.1 issued by reputable sale and purchase brokers
appointed by the Security Trustee, acting with the authorisation of the
Instructing Group certifying the market value of the relevant Vessel at the
expense of the Owner thereof;

16.3.9                                      certified
copy of the Approved Management Agreement in respect of the relevant Vessel;

16.3.10                               copies
of ISM Code Documentation in relation to the relevant Vessel (i.e. SMC) and the
Manager (i.e. DOC) and ISPS Code Documentation; and

16.3.11                               certified
copies of the Purchase Documents in respect of the relevant Vessel together
with such evidence as the Security Trustee and/or its legal advisers shall
require in relation to the authorisation and execution of the Purchase
Documents on behalf of the Builder.

16.4                        The
agreement of the Banks to permit the drawdown of an Additional Works’ Advance
in respect of a Vessel is subject to the condition that the Security Trustee
shall have received the following documents or evidence in form and substance
satisfactory to the Security Trustee and its legal advisers on or prior to the
Drawdown Date of such Additional Works’ Advance:

16.4.1                                      evidence
that any balance (in addition to the relevant Additional Works’ Advance) due to
IOTA has been or will immediately on drawdown of the relevant Additional Works’
Advance be paid to IOTA:

16.4.2                                      receipt
from IOTA evidencing payment in full of the Additional Works for the Vessel
relevant to such Additional Works Advance;

16.4.3                                      a
detailed list prepared by IOTA and countersigned by the Owner of the relevant
Vessel setting out all the equipment and the Owners’ supplies in accordance
with the Additional Works’ Contract in respect of such Vessel;

16.4.4                                      evidence
in form and substance satisfactory to the Agent in its sole discretion that the
additional specialised equipment included into the list to be provided pursuant
to Clause 16.4.3 above has been installed In the relevant Vessel together with
copies of all appropriate technical certificates verifying the above
installation;

16.5                        Furthermore
the obligation of the Banks to make the Advances is subject to the following
further conditions:

16.5.1                                      that
both at the date of a Notice of Drawdown and on each Drawdown Date-

(a)                                  no
Event of Default or Potential Event of Default has occurred and is continuing
or might result from the making of the relevant Advance(s); and

(b)                                  the
representations and warranties of the Borrowers in Clause 14 and the
representations and warranties of the Borrowers and other parties to the
Subject Documents set out in the Subject Documents are true and accurate as of
each 

 

 

37

 

such date, as if made on each
such date with reference to the facts then subsisting.

16.5.2                                      that
the Security Trustee shall have received, and found to be satisfactory to it in
all respects, such further opinions, consents, agreements and documents in
connection with this Agreement and the Subject Documents as the Security
Trustee may request by notice to the Borrowers prior to each Drawdown Date.

PROVIDED
HOWEVER THAT the Agent may (with the prior written consent of all the Banks)
allow any Advance to be drawn down and also may (with the prior written consent
of all the Banks and the L/C Bank) allow sums to be released from the Cash
Collateral Account notwithstanding that all conditions specified in the
respective sub-clauses of this Clause 16 have not been fulfilled and in this
event each of the Borrowers hereby covenants to fulfil and procure the fulfilment
of such conditions within five (5) Business days after the relevant Drawdown
Date or the relevant date of release of funds from the Cash Collateral Account
(as the case may be) or at such other time specified by the Agent with the
prior written consent of the Banks and in the case of release of funds from the
Cash Collateral Account, the Banks and the L/C Bank and the advance of any part
of the Loan, shall not be taken as a waiver of the Agent and Bank’s right to
require production of all documents and evidence required by Clause 16.1.

17                                  MAINTENANCE OF SECURITY

17.1                        If
the Agent reasonably requires at any time and from time to time and at least
every twelve (12) months, each Mortgaged Vessel shall be valued in Euros by two
Approved S & P Brokers chosen by the Security Trustee, acting with the
authorisation of the Instructing Group and the Market Value of each Mortgaged
Vessel shall be the average of such two valuations which shall be made without
physical inspection (unless otherwise required by the Security Trustee), and on
the basis of an arm’s-length purchase by a willing buyer from a willing seller
and without taking into account any charterparty. The fees of the Approved S &
P Brokers appointed to give such valuations and all other costs arising in
connection with the obtaining of any such valuations shall be paid by the
Borrowers.

17.2                        In
the event that at any time during the Security Period after the earlier of (i)
the Drawdown Date of the Delivery Advance last to occur and (ii) the Final Availability
Date the Security Value shall be less than the Security Requirement applicable
at the relevant time, then the Borrowers shall within twenty (20) Banking Days
of receipt of a notice from the Security Trustee advising the Borrowers of the
amount of such deficiency (which notice shall be conclusive) either provide to the Security Trustee and/or the Creditor
Parties additional security (valued in accordance with normal banking practice)
which shall in all respects be acceptable and satisfactory to the Banks in
their sole discretion so that the Security Value together with the value of any
additional security (valued as aforesaid) provided to the Security Trustee
and/or the Creditor Parties pursuant to this Clause 17 is at least equal to the
Security Requirement or prepay part
of the Facility in accordance with Clause 8 so that the Security Value together
with the value of any additional security (valued as aforesaid) provided to the
Security Trustee and/or the Creditor Parties pursuant to this Clause is at
least equal to the Security Requirement applicable at the relevant time.

18                                  GENERAL UNDERTAKINGS

18.1                        The
Borrowers hereby jointly and severally undertake with each Creditor Party to
comply with the following provisions of this Clause 18 at all relevant times
during the Security Period, except as the Security Trustee may, with the
authorization of the Instructing Group, otherwise permit:

18.1.1                                      to
prepare or cause to be prepared: consolidated financial statements of the Group
in accordance with. the Applicable Accounting Principles consistently applied
in respect of each financial year (starting with the financial year ended on 31
December 2006) 

 

 

38

 

and cause the same to be
reported on by their auditors; consolidated financial statements of the Group
in accordance with the Applicable Accounting Principles consistently applied in
respect of each financial quarter (starting with the financial quarter ending
31 March 2007; unaudited financial statements of the Borrowers in accordance
with the Applicable Accounting Principles consistently applied in respect of
each financial year; and, in each case, deliver as many copies of the same as
the Security Trustee may reasonably require as soon as practicable but not later
than ninety (90) days (in the case of the audited financial statements) or
forty five (45) days (in the case of the unaudited financial statements) after
the end of the financial period to which they relate;

18.1.2                                      to
deliver the Security Trustee sufficient copies for all the Banks of every
report, circular, notice or like document issued by the Borrowers or the
Corporate Guarantors to their shareholders or creditors generally;

18.1.3                                      to
provide the Security Trustee with such financial or other Information
concerning any Borrower, the Corporate Guarantors, their respective Related
Companies, the other Security Parties and their respective Related Companies
and their respective affairs (including, without limitation, their activities,
financial standing, Indebtedness and operations and the performance of the
Vessels) as the Security Trustee may from time to time require;

18.1.4                                      to
obtain promptly at any time and from time to time such registrations, licenses,
consents and approvals as may be required in respect of this Agreement and the
other Subject Documents under any applicable law or regulation to enable the
Borrowers to perform and discharge their duties and liabilities hereunder and
thereunder and promptly supply the Security Trustee with copies thereof;

18.1.5                                      to
deliver to the Security Trustee translations into English (certified by an
authorized translator) of any documents which have to be delivered to the
Creditor Parties or any of them under the terms of this Agreement or the other
Finance Documents, the originals of which are not in the English language and
execute any further document required by the Security Trustee in order to perfect or complete the security
created by the Finance Documents;

18.1.6                                      to
maintain their corporate existence under the laws of the Republic of the
Marshall Islands and comply with all relevant legislation applicable to them;

18.1.7                                      to
promptly notify the Security Trustee in writing of any Event of Default or any Potential Event of Default and of the steps (if any) which are being taken to nullify or mitigate
its effect and of any dispute between any one or more of the Builder, the
Refund Guarantor, the Borrowers, and the Corporate Guarantors, under the
Subject Documents or any of them and of any occurrence of which they become
aware which might adversely affect their ability to perform and discharge their
duties and liabilities under this Agreement and/or the other Subject Documents;

18.1.8                                      not
to dissolve, merge into or consolidate
with any other company or partnership and ensure and procure that no change in
the management or the legal or beneficial ownership of the Borrowers, the
Corporate Guarantors and the Vessels shall be effected;

18.1.9                                      unless
otherwise permitted by the Security Trustee (acting with the authorisation of
the Instructing Group), not to amend, modify, vary or supplement or terminate
or agree to any amendment, modification, variation or supplement or
cancellation of any of the Subject Documents;

18.1.10                               not
to engage in any business or activity, apart from the ownership and operation
of the Vessel owned by each Borrower and activities ancillary thereto as
permitted by this Agreement and the other Finance Documents;

 

 

39

18.1.11                               to ensure that at all times the
claims of the Creditor Parties against the Security Parties under this
Agreement and/or the other Finance Documents rank at least pari passu with the claims of all their
other unsecured creditors save those whose claims are preferred by any
bankruptcy, insolvency or other similar laws of general application;

18.1.12                               not to and ensure and procure
that the Manager shall not make any advances, grant any credit or give any
guarantee or indemnity to or for the benefit of any person or otherwise
voluntarily assume any liability, whether actual or contingent, in respect of
any obligations of any person, firm or company (save and except in connection
with the ordinary course of operation of trading of the Vessels or, only in the
case of the Manager, in the ordinary course of operation and trading of any
other vessel managed by it);

18.1.13                               not to issue any further shares
or alter any rights attaching to their issued shares in existence at the date
of this Agreement;

18.1.14                               not to convey, assign, transfer,
sell or otherwise dispose of or deal with the Vessels or either of them;

18.1.15                               not to sell, lease, transfer or
otherwise dispose of, by one or more transactions or series of transactions
(whether related or not), the whole or any part of their assets (other than the
Vessels) or rights whether present or future;

18.1.16                               not to borrow any money or
permit any such borrowing to continue or incur any indebtedness whatsoever
other than the Facility or other than by way of subordinated shareholders’
loans or enter into any agreement for payment on deferred terms (otherwise than
on customary suppliers’ credit terms) or any equipment lease or contract hire
agreement other than in the ordinary course of business;

18.1.17                               not to authorise or accept any
capital commitments (save and except in connection with the purchase of and the
ordinary course of operation or trading of the Vessels);

18.1.18                               not to declare or pay dividends
or make any distributions to their shareholders in any form whatsoever;

18.1.19                               from time to time (but not more
than once every six (6) months) on request by the Security Trustee, to deliver
to it a certificate signed by a director or officer of each of the Borrowers
confirming that, save as may be notified in detail in such certificate, no
Event of Default or Potential Event of Default has occurred and is then
subsisting to be accompanied by such evidence as to the information and matters
contained in such certificate as the Security Trustee and/or the other Creditor
Parties may from time to time reasonably require;

18.1.20                               to pay and to ensure and procure
that the other Security Parties shall pay all Taxes, assessments and other
governmental charges when the same fall due, except to the extent that the same
are being contested in good faith by appropriate proceedings and adequate
reserves have been set aside for their payment if such proceedings fail and
ensure and procure that all relevant tax returns of the Borrowers and the other
Security Parties shall be properly and timely filed;

18.1.21                               without prejudice to their
obligations under Clause 18.1.6 to send (or procure that it is sent) to the
Security Trustee for distribution to the other Creditor Parties as soon as the
same is instituted (or, to the knowledge of the Borrowers threatened), details
of any litigation, arbitration or administrative proceedings against or
involving the Borrowers the other Security Parties (or any of them) or the
Vessels or either of them which is likely to have a material adverse effect on the
Borrowers, the other Security Parties (or any of them) or the operation of the
Vessels;

 

 

40

 

18.1.22                               not to amend their articles of
incorporation and by-laws or other constitutional documents;

18.1.23                               not to amend, modify, vary,
supplement, terminate, cancel or rescind or agree to any amendment,
modifications, variation, supplement, termination, cancellation or rescission
of any of the Subject Documents

18.1.24                               not to change, cause or permit
any change in, the legal and/or ultimate beneficial ownership of any of the
shares in any of the Borrowers, AEGEAN SHIPHOLDINGS or the Manager from that
specified in clause 14.1.10;

18.1.25                               not to change, cause or permit
any change in, the ultimate beneficial ownership of any shares in AEGEAN
PETROLEUM NETWORK which would result in the persons specified in clause 14.1.10
being the ultimate beneficial owners of less than thirty five per cent (35%) of
the total voting share capital of AEGEAN PETROLEUM NETWORK at any time or any
person (other than those referred to in clause 14.1.10) having the ultimate
beneficial ownership of more shares in AEGEAN PETROLEUM NETWORK than the
persons specified in clause 14.1.10 have at any time; and

18.1.26                               to ensure and procure that each
Corporate Guarantor shall comply with its obligations under the Corporate
Guarantee to which it is a party.

19                                  OPERATIONAL
UNDERTAKINGS

19.1                        The Borrowers hereby undertake
with the Creditor Parties that on the Delivery Date of each Vessel and
throughout the Security Period thereafter, shall comply with the following
provisions of this Clause 19 except as the Security Trustee may, with the
authorization of the Instructing Group, otherwise permit:

19.1.1                                      to procure that each Vessel
shall be duly registered under the laws and the flag approved by the Creditor
Parties in the ownership of the Owner thereof and not do or suffer to be done
anything whereby the registration may be forfeited or imperilled;

19.1.2                                      to appoint and/or keep the
Manager appointed as manager of the Vessels and not vary or terminate this
appointment;

19.1.3                                      not save as contemplated in the
Finance Documents, to create, incur or permit to subsist any Encumbrance over
the Vessels, the Earnings, the Insurances or the Requisition Compensation or
all or any of the present or future assets of the Borrowers or either of them
(other than any Permitted Encumbrance);

19.1.4                                      not at any time to represent to
a third party that the Creditor Parties (or any of them) are carrying cargo in
the Vessels or either of them or are in any way connected or associated with an
operation or carriage being undertaken by them or have any operational interest
in the Vessels or either of them;

19.1.5                                      not to voyage or time charter
the Vessels or either of them or place them/her under contract for employment
(a) for any period which when aggregated with any optional periods of extension
contained in the said charter or contract, would exceed twelve (12) months or
(b) at a charter rate which is below the market rate at the time of the charter
fixture and in case of a Vessel being employed for more than twelve (12)
months, after having obtained the Security Trustee’s consent acting on the
instructions of the Instructing Group, the Security Trustee shall be furnished
with (i) details and documentary evidence satisfactory to the Security Trustee
In its sole discretion in respect of the new employment and (ii) upon Security
Trustee’s request, a specific assignment in favour of the Security Trustee of
the benefit of such charter together with a notice of any such assignment
addressed to the relevant charterer and endorsed with an acknowledgement of
receipt by the relevant charterer all in form and substance satisfactory to the
Security Trustee;

 

 

41

 

19.1.6                                      not to demise charter the
Vessels or either of them for any period whatsoever;

19.1.7                                      not without the prior written
consent of the Security Trustee to put a Vessel into the possession of any
person for the purpose of work being done upon her in an amount exceeding or
likely to exceed US$300,000 (or the equivalent in any other currency) unless
the Borrowers shall have satisfied the Security Trustee that the cost of such
work is fully recoverable under the Insurances (save for any applicable
deductible) or such person shall first have given to the Security Trustee and
in terms satisfactory to it a written undertaking not to exercise any lien on a
Vessel or her Earnings or Insurances for the cost of such work or otherwise;

19.1.8                                      to give the Security Trustee
reasonable prior notice of any dry-docking of either Vessel so that the
Security Trustee (if it so requires) can arrange for a representative to be
present;

19.1.9                                      to notify the Security Trustee
of any intended laying-up or de-activation of either Vessel;

19.1.10                               to provide the Security Trustee
with such copies of the trading certificates of each Vessel as the Security
Trustee may from time to time require;

19.1.11                               to hold or procure that the
Manager shall hold all appropriate ISM Code Documentation and ISPS Code
Documentation and provide the Agent upon request from time to time with copies
of the relevant ISM Code Documentation and ISPS Code Documentation duly issued
to the Manager and the Vessels and the Owners pursuant to the ISM Code and the
ISPS Code respectively;

19.1.12                               to keep, or procure that there
is kept, on board a Vessel a copy of all relevant ISM Code Documentation and
ISPS Code Documentation;

19.1.13                               as soon as an Owner becomes
aware, to inform the Security Trustee immediately should the Document of
Compliance and/or the Safety Management Certificate and/or the international
Ship Security Certificate issued in connection with the relevant ISM Code
Documentation or ISPS Code Documentation in respect of a Vessel be cancelled, rescinded,
suspended or amended in any way;

19.1.14                               to notify the Security Trustee
promptly upon being made aware thereof upon the

occurrence of:

(a)                                  any Environmental Claim against
the Owners or either of them or the Manager or the Vessels or either of them;

(b)                                  any Environmental Incident which
may give rise to an Environmental Claim which could or might materially affect
the interests of the Owners, the Manager or any of them;

(c)                                  any claim for breach of the ISM
Code or the ISPS Code being made against the Owners, an ISM Responsible Person,
the Manager or any of them or otherwise in connection with the Vessels or
either of them; and

(d)                                  any other matter, event or
incident actual or threatened, the effect of which would lead to the ISM Code
or the ISPS Code not being complied with;

and to keep the Security Trustee advised in writing on a regular basis
and in such detail as the Security Trustee shall require of the relevant Owner’s,
the ISM Responsible Person’s, the Manager’s or any other person’s proposed or
actual response to any of those events or matters;

19.1.15                               to permit, or procure that the
Security Trustee shall have the right at any time on reasonable notice to
inspect or survey each Vessel or instruct a duly authorised

 

 

42

 

independent surveyor to carry
out such survey on its behalf to ascertain the condition of such Vessel and
satisfy itself that such Vessel is being properly repaired and maintained,
provided that such inspections shall not unreasonably interfere with such
Vessel’s running or operation (and the costs of such inspection or survey shall
be payable by the Borrowers);

19.1.16                               to promptly provide the Security
Trustee with information concerning the classification status and insurance of
the Vessels from time to time as and when so required in writing by the
Security Trustee;

19.1.17                               to ensure that the Owners shall
execute and deliver to the Security Trustee such documents of transfer as the
Security Trustee may require in the event of sale of the Vessels pursuant to
any power of sale contained in the Mortgage over the relevant Vessel or which
the Security Trustee may have in law;

19.1.18                               to provide the Security Trustee
with a certificate of ownership and encumbrances relative to the Vessels issued
by the relevant registry of the Vessels; and

19.1.19                               upon becoming aware, to notify
the Security Trustee immediately by telefax of any recommendation or
requirement imposed by the Classification Society, the Insurers or by any other
competent authority in respect of a Vessel that is not complied with in
accordance with its terms;

19.1.20                               to ensure that each Owner shall
carry on each Vessel with the Vessel’s papers a properly certified copy of the
Mortgage over such Vessel and exhibit the same to any person having a legal
interest in, or having business with, such Vessel and to any representative of
the Security Trustee, and place and keep prominently in the Chart Room and in
the Master’s cabin of such Vessel a framed notice printed in plain type of such
size that the paragraph of reading matter shall cover a space not less than six
inches wide and nine inches high reading as follows:

“NOTICE OF MORTGAGE

This Vessel is owned by [______] and is subject to a first preferred
(priority] mortgage in favour of AEGEAN BALTIC BANK S.A. (and HSH NORDBANK AG).
Under the terms of said Mortgage, neither the Owner, nor the Master nor any
other person has any right, power or authority to create, incur or permit to be
imposed upon this Vessel any other lien whatsoever other than for crew’s wages
and salvage”

19.1.21                               to pay when due and payable all
taxes, assessments, levies, governmental charges, fines and penalties lawfully
imposed on and enforceable against the Vessels unless contested In good faith
by the Owners by the appropriate proceedings;

19.1.22                               if any writ or proceedings shall
be issued against the Vessels or either of them shall be otherwise attached,
arrested or detained by any proceeding in any court or tribunal or by any
government or other authority, to Immediately notify tie Security Trustee
thereof by telefax confirmed by letter and within fourteen (14) days thereafter
cause that Vessel to be released;

19.1.23                               not to cause or permit the
Vessels or either of them to be operated 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 not to engage in any unlawful trade or carry any
cargo that will expose the Vessels or either of them to penalty, forfeiture or
capture and in the event of hostilities in any part of the world (whether a war
be declared or not) not employ the Vessels or either of them or voluntarily
suffer their/her employment in carrying any contraband goods;

19.1.24                               to promptly pay all tolls, dues
and outgoings in respect of each Vessel and all wages, allotments, insurance
and pension contributions of the Master and crew of each Vessel when due and
make all deductions from the wages in respect of any tax

 

 

43

 

liability, accounting to the
relevant authority for them and if the Security Trustee at any time has
reasonable cause to believe that such payments may not be being made, to
produce to the Security Trustee at its request evidence confirming that all
such amounts have been paid when due;

19.1.25                               at all times to maintain each
Vessel in a seaworthy condition and in good running order and repair in
accordance with first class ship ownership and ship management practice and
keep each Vessel in such condition as will entitle them/her to be classed at
the highest classification status with their/her Classification Society free of
all recommendations and qualifications (other than those which have been or are
being complied with in accordance with their terms and which are not by their
terms overdue for compliance), follow any interim operational provisos to such
recommendations and qualifications and when so requested to provide the
Security Trustee with a certificate issued by the relevant Classification
Society confirming that such classification is maintained;

19.1.26                               to submit each Vessel regularly
to such periodical or other surveys as may be required for classification
purposes and, if so required by the Security Trustee in writing, supply to the
Security Trustee copies of all survey reports issued in respect thereof;

19.1.27                               at all times to comply with all
legal requirements whether imposed by enactment, regulation, common law or
otherwise and have on board each Vessel as and when legally required valid
certificates showing compliance therewith;

19.1.28                               without prejudice to the
generality of Clause 19.1.27, to obtain and maintain any and ail Environmental
Approvals required in respect of each Vessel and comply or procure that the
Manager or any charterer of either Vessel (including without limitation the
Time Charterer) will at all times comply with the ISM Code, the ISPS Code, the
ISPS Code Documentation, all Environmental Laws, and all other laws and
regulations relating to each Vessel, its ownership, operation, manning and
management or to the business of the each Owner and/or the Manager;

19.1.29                               not remove or permit the removal
of any part of the Vessels or either of them or any equipment belonging thereto
nor make or permit any alterations to be made in the structure, type or speed
of the Vessels or either of them which materially reduce the value of the
Vessels or either of them (unless such removal or alteration is required by
statute or by the Classification Society); and

19.1.30                               in the event of Compulsory
Acquisition of a Vessel execute any assignment that the Security Trustee may
request in relation to any and all amounts which the relevant Government Entity
shall be liable to pay as compensation for such Vessel or for its use and if
received by the Owner thereof to pay such amounts immediately to the Agent.

19.2                        The Borrowers hereby irrevocably
agree and undertake to ensure and procure that -

19.2.1                                      the Security Trustee, or its
authorised representatives may, without prior notification, communicate
directly with the Classification Society concerning maintenance, repair,
classification and seaworthiness of the Vessels, and to the same extent with
any regulatory authority having jurisdiction over the Vessels;

19.2.2                                      the Owners shall unconditionally
authorise the Classification Society or regulatory authority, at the request of
the Security Trustee, to give information to it, or its authorised
representatives and to conduct inspections and surveys of the Vessels, as if
requested by the Owners;

provided that the Security Trustee will not,
without prior consultation with the Borrowers, take any action under this
Clause 19.2 unless an Event of Default or Potential Event of Default has
occurred.

 

 

44

 

19.3                        The Borrowers shall throughout
the Security Period duly observe and perform all of the covenants, obligations
and conditions which are required to be observed and performed on their part
under this Agreement and each of the other Finance Documents to which they are
a party and shall use their best endeavours to procure that all covenants,
obligations and conditions required to be observed and performed, and
undertakings made, by any of the other Security Parties under any of the
Subject Documents shall be observed and complied with in their entirety.

20                                  INSURANCE
UNDERTAKINGS

20.1                        The Borrowers hereby also
undertake with the Creditor Parties to comply or to ensure and procure that the
Manager shall comply with the following provisions of this Clause 20.1 from the
Delivery Date of each Vessel at all times during the Security Period, except as
the Security Trustee may, with the authorisation of the Instructing Group
otherwise permit, at the expense of the Borrowers and upon such terms and
conditions, in such amounts and with such Insurers as shall from time to time
be approved in writing by the Security Trustee and, if so required by the
Security Trustee (but without, as between the Security Trustee and the
Borrowers and/or the Manager, liability on the part of the Security Trustee for
premiums or calls) with the Security Trustee named as co-assured:

20.1.1                                      to insure and keep insured each
Vessel in Euros or such other currency as may be approved in writing by the
Security Trustee for the full insurable value of each Vessel but in no event
for an aggregate amount in respect of the Mortgaged Vessels which is less than
one hundred twenty per cent (120%) of the Facility against fire and usual
marine (including Excess Risks) and War Risks covered by hull and machinery
policies;

20.1.2                                      to enter each Vessel in the name
of the Owner thereof for her full value and tonnage against all Protection and
Indemnity Risks in a protection and indemnity association approved by the
Security Trustee with unlimited liability if available otherwise with the least
limited liability for the time being US$1,000,000,000 in relation to oil
pollution risks and to comply with the rules of such protection and indemnity
association from time to time in effect and if so requested by the Security
Trustee to obtain excess oil spillage and pollution insurance in excess of the
limit of the protection and indemnity association with the highest possible
cover;

20.1.3                                      if either Vessel enters the
territorial waters of the USA (or other jurisdiction having legislation similar
to the US Oil Pollution Act 1990) for any reason whatsoever to take out such
additional insurance to cover such risks as may be necessary in order to obtain
a Certificate of Financial Responsibility from the United States Coastguard;

20.1.4                                      to pay to the Security Trustee
upon first demand all premiums and other amounts payable by the Security
Trustee in effecting a Mortgagees’ Interest Insurance policy (“MII”) and a Mortgagees’ Interest Additional Perils Insurance
(“MAPI”) in relation to the Vessels in
the name of the Security Trustee, upon such terms and conditions and with such
insurers and for such amount as the Security Trustee may require which amount
shall not be less than one hundred and twenty per cent (120%) (as regards MII)
and one hundred and ten per cent (110%) (as regards MAPI) of the Facility;

20.1.5                                      to effect such additional
Insurances that shall (in the reasonable opinion of the Security Trustee) be
necessary or advisable.

20.2                        The Borrowers further undertake
with the Creditor Parties to comply or to ensure that the Manager shall comply
with the following provisions of this Clause 20.2 at all times during the
Security Period except as the Security Trustee may with the authorisation of
the Instructing Group otherwise permit:

20.2.1                                      to renew the Insurances at least
ten (IO) Business Days before the Insurances expire (or give the Security
Trustee evidence satisfactory to it that such Insurances will be renewed upon
their stated expiry dates) and to procure that the Approved Brokers or

 

 

45

 

the Insurers (as the case may
be) shall promptly confirm in writing to the Security Trustee the terms and
conditions of such renewal as and when the same occurs;

20.2.2                                      punctually to pay all premiums,
calls, contributions or other sums payable in respect of the Insurances and to
produce evidence of payment when so required in writing by the Security
Trustee;

20.2.3                                      to arrange for the execution of
such guarantees as may from time to time be required by any Protection and
Indemnity or War Risks association;

20.2.4                                      to procure that the Insurance
Documents shall be deposited with the Approved Brokers or the Insurers (as the
case may be) and that the Approved Brokers or the Insurers (as the case may be)
shall provide the Security Trustee with pro forma copies thereof and shall
issue to the Security Trustee a letter or letters of undertaking In such form
as the Security Trustee shall reasonably require;

20.2.5                                      to procure that the Protection
and Indemnity and/or War Risks associations in which the Vessels are entered
shall provide the Security Trustee with a letter or letters of undertaking in
such form as may be reasonably required by the Security Trustee and shall
provide the Security Trustee with a copy of the certificate of entry and, if so
requested by the Security Trustee, a copy of each certificate of financial
responsibility for pollution by oil or other substances issued by such
Protection and Indemnity and/or War Risks association in relation to the
Vessels;

20.2.6                                      to procure that the interest of
the Security Trustee is endorsed on the Insurance Documents by means of a
Notice of Assignment in the form in Schedule 3 to the Assignment Agreements or
such other form as the Security Trustee may require and that the Insurance Documents
(including all certificates of entry in any Protection and Indemnity and/or War
Risks association) shall contain a loss payable clause during the Security
Period in the form in Schedule 4 or Schedule 5 (as may be appropriate) to the
Assignment Agreements or such other form as the Security Trustee may require;

20.2.7                                      to procure that the Insurance
Documents shall provide that the lien or set off for unpaid premiums or calls
shall be limited to only the premiums or calls due in relation to the Insurances
on the Vessels and the Insurers shall not cancel any of the Insurances by
reason of non-payment of premium or calls due in respect of other vessels or in
respect of other insurances and for fourteen (14) days prior written notice to
be given to the Security Trustee by the Insurers (such notice to be given even
If the Insurers have not received an appropriate enquiry from the Security
Trustee) in the event of cancellation or termination of the Insurances and in
the event of the non-payment of the premium or calls, the right to pay the said
premium or calls within a reasonable time;

20.2.8                                      promptly to provide the Security
Trustee with full information regarding any casualties or damage to a Vessel in
an amount in excess of USD 300,000 or its equivalent in any other currency or
in consequence whereof a Vessel have become or may become a Total Loss;

20.2.9                                      at the request in writing of the
Security Trustee to provide the Security Trustee, at the Borrowers’ cost (but
not more often than once in every twelve (12) months), with a detailed report
issued by a firm of marine Insurance brokers or consultants appointed by the
Borrowers and approved by the Security Trustee in relation to the Insurances;

20.2.10                               not to do any act nor
voluntarily suffer nor permit any act to be done whereby any Insurances shall
or may be suspended or avoided and not to suffer nor permit the Vessels or
either of them to engage in any voyage nor to carry any cargo not permitted
under the Insurances in effect without first obtaining the Insurers’ consent
for such voyage or the carriage of such cargo and complying with such
requirements as to extra premiums or otherwise as the Insurers may prescribe;

 

 

46

 

20.2.11                               not to employ the Vessels or either
of them, or offer the Vessels or either of them to be employed, otherwise than
in conformity with the terms of the Insurance Documents (including any express
or implied warranties they contain), without first obtaining the Insurers’
consent to such other employment and complying with such requirements as to
extra premiums or otherwise as the Insurers may prescribe, or arranging for
additional insurance;

20.2.12                               (without limitation to the
generality of the foregoing) in particular not to permit the Vessels or either
of them to enter or trade to any zone which is declared a war zone by any
government or by the Insurers in respect of War Risks unless there shall have
been effected by the Owners and at their expense such special insurance or the
consent of the Insurers to enter or trade into such zone is obtained and the
relevant Owner(s) is(are) complying with such requirements as to extra premiums
or otherwise as the Insurers may prescribe;

20.2.13                               to procure that all amounts
payable under the Insurances are paid in accordance with the relevant loss
payable clause under Clause 20.2.6 and to apply all amounts as are paid to the
Owners for the purpose of making good the loss and fully repairing all damage
in respect of which the said amounts shall have been received;

20.2.14                               should a Vessel be laid up for
any period, to arrange ‘lay-up’ Insurances for such Vessel during such period,
at their own cost and upon such terms and conditions, in such amounts and with
such Insurers as shall from time to time be approved in writing by the Security
Trustee; and

20.2.15                               to ensure and procure that
during the period prior to the Delivery Date of each Vessel, such Vessel shall
be insured in accordance with the terms of the Shipbuilding Contract in respect
thereof.

21                                  [INTENTIONALLY
LEFT BLANK]

22                                  EVENTS OF
DEFAULT

22.1                        Each of the following events
shall constitute an Event of Default (whether such event shall occur or come
about voluntarily or involuntarily or by operation of law or regulation or
pursuant to, or in compliance with any judgment, decree or order of any court
or other authority):

22.1.1                                      the Borrowers shall fail to pay
when due any amount (whether in respect of principal, interest or otherwise)
under this Agreement or any of the other Finance Documents to which it is a
party on the due date;

22.1.2                                      any representation, warranty or
statement made by any Party (other than the Creditor Parties) in this Agreement
or in the other Finance Documents or any certificate, statement or opinion
delivered or made hereunder or under the other Finance Documents or in
connection herewith or with the other Finance Documents shall be incorrect or
inaccurate when made in any material respect;

22.1.3                                      an event of default or a
potential event of default under any of the Subject Documents (as defined
therein) shall have occurred;

22.1.4                                      the Borrowers or either of them
shall fail duly and punctually to perform or observe any other term of this
Agreement or the other Finance Documents to which each of the Borrowers is a
party and such failure, if capable of remedy, shall continue for fourteen (14)
days after the Security Trustee shall have given to the Borrowers notice of
such failure;

22.1.5                                      except where contested in good
faith by the appropriate proceedings, any other indebtedness of the Borrowers
or either of them shall become due and payable or, with the giving of notice or
lapse of time or both, capable of being declared due and

 

 

47

 

payable, prior to its stated
maturity by reason of any circumstance entitling the creditor(s) thereof to
declare such indebtedness due and payable and such indebtedness is not paid
within fourteen (14) days thereof;

22.1.6                                      the Borrowers or either of them
shall enter into voluntary or involuntary bankruptcy, liquidation or
dissolution, or shall become insolvent, or an administrator, administrative
receiver, receiver or liquidator shall be appointed of all or a material part
of their undertakings or assets or proceedings are commenced by or against them
under any reorganisation, arrangement, readjustment of debts, dissolution or
liquidation law or regulation;

22.1.7                                      the Borrowers or either of them
shall cease or threaten to cease to carry on its business;

22.1.8                                      there shall be a transfer or
disposal of all or a substantial part of the assets of the Borrowers or either
of them, whether by one or a series of transactions, related or not, without
the prior written consent of the Security Trustee acting with the authorisation
of the Instructing Group;

22.1.9                                      there is a considerable
deterioration in the financial position of the Borrowers or either of them or
any Security Party or any other member of the Group which in the reasonable
opinion of the Security Trustee is likely to affect the ability of the
Borrowers or either of them to pay all amounts due from time to time under this
Agreement and/or the other Finance Documents;

22.1.10                               any governmental or other
consent, licence or authority required to make this Agreement and/or the other
Finance Documents legal, valid, binding, enforceable and admissible in evidence
or required to enable the Borrowers or either of them to perform their/its
duties and discharge their/its liabilities hereunder or under the other Finance
Documents is withdrawn or ceases to be in full force and effect unless the
Borrowers or either of them procure that such consent, licence or authority is
reinstated or re-issued to the satisfaction of the Security Trustee within
fifteen (15) days of the said withdrawal or cessation; or

22.1.11                               any of the events referred to in
Clauses 22.1.1, 22.1.2, 22.1.3, 22.1.4, 22.1.5, 22.1.6, 22.1.7, 22.1.8, 22.1.9
or 21.1.10 occurs, mutatts mutandis, in
respect of any other Security Party;

22.1.12                               any Encumbrance which may for
the time being affect any of the assets of the Borrowers or either of them or
any of the other Security Parties which are considered, in the opinion of the
Security Trustee, to be material becomes enforceable;

22.1.13                               any event occurs which would
result in the crystallisation of any floating charge over the whole or any part
of the assets of the Borrowers or either of them or any other Security Party;

22.1.14                               for any reason the Security
Trustee certifies that in its opinion the security constituted by any of the
Finance Documents is or may be in jeopardy in any respect;

22.1.15                               the country of domicile of the
Borrowers or either of them or of any other relevant jurisdiction affected by
the financing herein provided becomes involved in hostilities or civil war or
there is a seizure of power in that country by unconstitutional means if in any
such case, the event could in the opinion of the Security Trustee reasonably be
expected to have a material adverse effect on the ability of the Borrowers or
either of them to comply with their/its obligations under any Subject Document;

22.1.16                               all or a material part of the
undertaking, assets, rights or revenues of the Borrowers or either of them are
seized, nationalised, expropriated or compulsorily acquired by or under the
authority of any government or
governmental authority without the payment

 

 

48

 

of compensation equivalent to
their full value in a currency which is freely convertible into Euros;

22.1.17                               there occur any circumstances of
a national or international financial, political, military, social or economic
nature which, in the opinion of the Security Trustee may have a material
adverse effect on the financial condition of the Borrowers or either of them or
of any of the other Security Parties or may imperil, delay or prevent
fulfilment by the Borrowers or either of them of their/its obligations under
any Subject Document;

22.1.18                               any Advance is applied or used
other than strictly for the purposes referred to in Clause 2.2;

22.1.19                               an Owner sells, transfers, disposes
of or encumbers its Vessel or any interest or share therein, or agree so to do
(other than Permitted Encumbrances) without the prior written consent of the
Security Trustee;

22.1.20                               the Subject Documents or any of
them shall cease, in whole or in part, to be valid, binding and enforceable;

22.1.21                               a Vessel is arrested or detained
and such arrest or detention is not released within fourteen (14) days, or an
order for the sale of such Vessel is made by a court of competent jurisdiction
or the Owner thereof ceases to retain possession and/or control of its Vessel
for a period in excess of fourteen (14) days;

22.1.22                               a Vessel is a Total Loss and the
Agent and/or the Security Trustee shall not have received within one hundred
eighty (180) days following the occurrence of the Total Loss (or such earlier
date as the Total Loss claim is paid) from the Insurers the insurance proceeds
paid in conformity with the terms of Clauses 8.1 and 8.2 or an equal amount
from the Borrowers or either of them in case the Insurers do not accept the
relevant Total Loss claim;

22.1.23                               a Vessel is laid up for a period
exceeding thirty (30) days without the prior written consent of the Banks or
the Agent or the Security Trustee, as the case may be;

22.1.24                               either Vessel is not delivered
to and/or accepted by the Owner thereof by the Final Availability Date;

22.1.25                               any one or more of the
Shipbuilding Contracts, the Additional Works’ Contracts, the Refund Guarantees
or any other Subject Document is amended or varied in any material (in the
opinion of the Security Trustee) way or rescinded or terminated for any reason
whatsoever without the Security Trustee’s prior written consent acting with the
authorisation of the Instructing Group;

22.1.26                               the Refund Guarantor fails to
make any payment due by it to the relevant Owner under any Refund Guarantee;

22.1.27                               there is any change in the legal
and/or ultimate beneficial ownership of any of the shares of any of the
Borrowers, AEGEAN SHIPHOLDINGS or the Manager from that existing on the date of
this Agreement as specified in clause 14.1.10;

22.1.28                               there is any change in the
ultimate beneficial ownership of any shares in AEGEAN PETROLEUM NETWORK, which
would result in the persons specified in clause 14.1.10 being the ultimate
beneficial owners of less than thirty five per cent (35%) of the total voting
share capital of AEGEAN PETROLEUM NETWORK or any person (other than those
referred to in clause 14.1.10) having the ultimate beneficial ownership of more
shares in AEGEAN PETROLEUM NETWORK than the persons specified in clause 14.1.10
have at any time;

 

 

49

 

22.1.29                               the shares of AEGEAN PETROLEUM
NETWORK are de-listed or suspended from, or cease to trade (whether temporarily
or permanently) on the New York Stock Exchange; or

22.1.30                               if an Event of Default occurs
under and as defined in the 1./C Facility Agreement or any of the other
security documents executed pursuant thereto.

22.2                        Upon the occurrence of an Event
of Default and at any time thereafter, the Security Trustee may (and if
instructed by an Instructing Group shall) by written notice to the Borrowers -

(a)                                  declare all or any part of the
indebtedness (including such unpaid interest as shall have accrued) immediately
due and payable whereupon the Indebtedness (or the part of the Indebtedness
referred to in the Security Trustee’s notice) shall immediately become due and
payable without any further demand or notice of any kind; and/or

(b)                                  declare that the Commitment of
the Banks shall be cancelled, whereupon the same shall be cancelled; and/or

(c)                                  take such Enforcement Action as
instructed by an Instructing Group

22.3                        The Security Trustee and the
other Creditor Parties may take any other action, exercise any other right or
pursue any other remedy conferred upon the Security Trustee and/or any other
Creditor Party by this Agreement and/or the other Finance Documents or by any
applicable taw or regulation or otherwise as a consequence of such Event of
Default.

23                                  FEES

23.1                        In addition to the fees paid
upon on the date of acceptance of the Commitment Letter by the Borrowers and, inter alias, certain Corporate Guarantors,
the Borrowers have agreed to pay to the Agent for the account of the Arranger
and the Lenders a non refundable fee (the “Arrangement Fee”) equal to 0.3750%
of the aggregate amount of the Total Commitments out of which 1/3rd thereof
shall be paid on the date hereof and an amount equal to the remaining 2/3rds
thereof shall be paid on the Drawdown Date of the Advance first to occur.

23.2                        The Borrowers shall pay to the
Agent for the account of each Bank an availability fee of zero point forty per
cent (0.40%) per annum on the from time to time available and undrawn amount of
each Advance (the “Availability Fee”), such Availability Fee for each Advance
shall accrue from the day to day for a period starting on the date of execution
of the Commitment Letter and ending on the Drawdown Date of the Advance it
relates or on the Applicable Availability Date in respect thereof, whichever is
earlier, shall be calculated upon the exact number of days which have elapsed
on the basis of a year consisting of three hundred sixty (360) days and shall
be payable quarterly in arrears and on the Drawdown Date of the Advance it
relates or the Applicable Availability Date in respect thereof, as the case may
be.

24                                  EXPENSES

24.1                        The Borrowers shall reimburse
each Creditor Party on demand for ail reasonable charges and expenses incurred
by the Creditor Parties or any of them in connection with the preparation,
negotiation and conclusion of this Agreement and the other Finance Documents
(including, but not limited to, all costs and expenses of the Creditor Parties
or any of them in connection with any assignment, transfer and
sub-participation of their rights under this Agreement and the other Finance
Documents) including fees and expenses of legal advisers and reasonable
out-of-pocket expenses.

24.2                        The Borrowers shall reimburse
each Creditor Party on demand for all charges and expenses (including legal
fees) incurred by any Creditor Party in or in connection with the

 

 

50

 

exercise of the Security Trustee’s
and/or the other Creditor Parties’ rights and powers under this Agreement and
the other Finance Documents (including but not limited to the fees and charges
of auditors, brokers, surveyors and legal counsel instructed by the Security
Trustee and/or the other Creditor Parties) and with the actual, attempted or
purported enforcement of, or preservation of rights under, this Agreement or
the other Finance Documents.

25                                  INDEMNITY

The Borrowers hereby jointly and severally undertake and agree to
indemnify the Creditor Parties, upon the Agent’s first demand, from and against
any losses, costs or expenses (including legal expenses) which they incur in
consequence of any Event of Default including (but without limitation) all
losses, premiums and penalties incurred or to be incurred in liquidating or
redeploying deposits made by third parties or funds acquired or arranged to
effect or maintain the Facility or any part thereof.

26                                  STAMP DUTIES

The Borrowers shall pay any and all stamp, registration and similar
taxes and charges of whatsoever nature, which may be payable or determined to
be payable on, or in connection with, the execution, registration,
notarisation, performance or enforcement of this Agreement or the other Finance
Documents. The Borrowers shall indemnify the Creditor Parties against any and
all liabilities with respect to or resulting from delay or omission on the part
of the Borrowers to pay any such taxes.

27                                  VARIATIONS
AND WAIVERS

27.1                        Subject to Clause 27.2, a
document shall be effective to vary, waive, suspend or limit any provision of a
Finance Document, or any Creditor Party’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 Borrowers, by the Security Trustee on behalf and with
the consent of the Instructing Group, by the Agent and the Security Trustee in
their own rights, and, if the document relates to a Finance Document to which a
Security Party is party, by that Security Party.

27.2                        However, as regards the
following, Clause 27.1 applies as if the words “by the Security Trustee on
behalf and with the consent of the Instructing Group” were replaced by the
words “by or on behalf and with the consent of every Bank”:

(a)                                  a change in the definition of
the Applicable Margin or in the definition of EURIBOR;

(b)                                  a change to the date for, or the
amount of, any payment of principal, interest, fees, or other sum payable under
this Agreement;

(c)                                  a change to any Bank’s
Commitment;

(d)                                  an extension of the Availability
Period;

(e)                                  a change to the definition of “Instructing
Group” or “Finance Documents”;

(f)                                    a change of the Manager as
manager of the Vessels or the terms and conditions of management of the
Vessels;

(g)                                 a change to the preamble or to
Clauses 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 12, 13, 15, 17, 22 or 36;

(h)                                 a change to this Clause 27;

 

 

51

 

(i)                                    (I)    any release of, or material variation to, an Encumbrance,
guarantee, indemnity or subordination arrangement set out in a Finance
Document; and

(j)                                    any other change or matter as
regards which this Agreement or another Finance Document expressly provides
that each Bank’s consent is required.

27.3                        Except for a document which
satisfies the requirements of Clauses 27.1 and 27.2, no document, and no act, course of conduct, failure or neglect to act, delay or acquiescence on the part of the Creditor
Parties or any of them (or any
person acting on behalf of any of them) shall result in the Creditor Parties or
any of them (or any person acting
on behalf of any of them) 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 Borrowers or
either of them or any other 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.

28                                  PARTIAL
INVALIDITY

In the event that any term or condition of this Agreement is rendered
or declared illegal, invalid or inoperative in whole or in part by any statute,
rule or regulation or any decision of any court or tribunal of competent
Jurisdiction then such determination or declaration shall neither affect nor
impair the validity of any other term or condition of this Agreement which
(save as aforesaid) will remain in full force and effect nor the legality,
validity or enforceability of such term or condition under the law of any other
jurisdiction.

29                                  THE
ARRANGER, THE AGENT, THE SECURITY TRUSTEE, THE L/C BANK AND THE BANKS

29.1                        Each Bank and the L/C Bank irrevocably appoints: (i) the
Arranger as arranger of the Facility and the L/C Facility, (ii) the Agent (acting on the instructions from time
to time of an Instructing Group) shall act as its agent for the purposes of
this Agreement and such of the other Finance Documents to which it may be
appropriate for the Agent to be party and otherwise in connection with the
administration of the Facility and the L/C Facility and all payments and
repayments of the Indebtedness, and (iii) the Security Trustee as security
trustee for the purposes of the Finance Documents and to receive, hold,
administer and enforce the Finance Documents for the benefit of the Banks and
the L/C Bank and each Bank and the L/C Bank authorises the Arranger, the Agent
and the Security Trustee (whether or not by or through employees or agents) to
take such action on such Bank’s or L/C Bank’s behalf and to exercise such
rights, remedies, powers and discretions as are specifically delegated to them
by this Agreement and the other Finance Documents, together with such powers
and discretion’s as are reasonably incidental thereto. The Arranger, the Agent
and the Security Trustee shall not however, have any duties, obligations or
liabilities to the Banks or to the L/C Bank beyond those expressly stated in
this Agreement and the other Finance Documents.

29.2                        Each Servicing Bank shall:

29.2.1                                      promptly send to each of the
other Creditor Parties details of each communication received by it from the
Borrowers under this Agreement or any other Finance

 

 

52

 

Document, except that details of
any communication relating to a Bank or to the L/C Bank shall be sent only to
that Bank or the L/C Bank as appropriate;

29.2.2                                      (in the case of the Security
Trustee) promptly send to each of the other Creditor Parties a copy of any
legal opinion delivered under this Agreement or any other Finance Document and
of any document or information received by it under Clause 16;

29.2.3                                      subject to the other provisions
of this Clause 29, act in accordance with any instructions from the Instructing
Group or, if so instructed by the Instructing Group, refrain from exercising a
right, power or discretion vested in it under this Agreement or any other
Finance Document; and

29.2.4                                      have only those duties,
obligations and responsibilities, of an administrative nature, expressly
specified in this Agreement and the other Finance Documents.

29.3                        Each Servicing Bank may:

29.3.1                                      perform any of its functions
under this Agreement and the other Finance Documents by or through its personnel
or agents;

29.3.2                                      refrain from doing anything
under this Agreement and the other Finance Documents until it has received
instructions from the Instructing Group as to whether (and, if it is to be, the
way in which) it is to be done and shall in all cases be fully protected when
acting, or (if so instructed) refraining from acting, in accordance with
instructions from the Instructing Group;

29.3.3                                      treat (a) each Bank as the
person entitled to repayment of that part of the Facility of which it is a
lender and has been advanced by it unless all or part of the relevant Banks’
Commitment has been transferred to another bank (or the Agent has received
notice of assignment of all or part of it) in accordance with Clause 31
whereupon such other bank shall be entitled to repayment of its share in the
Commitments advanced and (b) the office notified by each Bank to the Agent for
this purpose before the signing of this Agreement (or, as the case may be, set
out in the relevant Transfer Certificate) as its facility office unless the
Agent has received from such Bank or such other bank a notice of change of
facility office. Each Servicing Bank may act on any such certificate until it
is superseded by a further transfer;

29.3.4                                      refrain from disclosing any
document or information if such disclosure (and may refrain from doing anything
which) would or might in its opinion be contrary to any law, be a breach of any
duty of secrecy or confidentiality or otherwise render it liable to any person
and may do anything which is in its opinion necessary to comply with any law;

29.3.5                                      assume that no Event of Default
or Potential Event of Default has occurred unless an officer of the relevant
Servicing Bank (as the case may be) acquires actual knowledge to the contrary;
and

29.3.6                                      refrain from taking any step (or
further step) to protect or enforce the rights of any person under this
Agreement and the other Finance Documents until it has been indemnified (or
received confirmation that it will be so indemnified) and/or secured to its satisfaction
against any and all costs, losses, expenses or liabilities (including legal
fees) which it would or might sustain or incur as a result.

29.4                        Each Servicing Bank may:

29.4.1                                      rely on any communication,
certificate, legal opinion or other document believed by it to be genuine;

 

 

53

 

29.4.2                                      rely as to any matter of fact
which might reasonably be expected to be within the knowledge of any person on
a statement by or on behalf of that person;

29.4.3                                      obtain and pay for such legal or
other expert advice or services as may to it seem necessary or desirable and
rely on any such advice;

29.4.4                                      provide to any person engaged to
provide expert advice or services in connection with this Agreement and the
other Finance Documents, copies of all information in its possession or to
which it is entitled under or in connection with this Agreement and the other
Finance Documents; and

29.4.5                                      retain for its own benefit and
without liability to account any fee or other sum receivable by it for its own
account.

29.5                        The Arranger, the Agent and the
Security Trustee each agrees and declares, and each of the Banks and the L/C
Bank acknowledges, that, subject to the terms and conditions of this Clause,
the Agent and the Security Trustee hold the Trust Property on trust for the
Banks and the L/C Bank in accordance with their respective Proportionate
Shares, absolutely. Each of the Banks and the L/C Bank agrees that the
obligations, rights and benefits vested in the Agent and the Security Trustee
shall be performed and exercised in accordance with this Clause. The Agent and
the Security Trustee shall have the benefit of all of the provisions of this
Agreement benefiting them in their capacity as agent and security trustee for
the Banks and the L/C Bank, and all the powers and discretion conferred on
trustees by the Trustee Act 1925 (to the extent not inconsistent with this
Agreement). In addition:-

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

29.5.2                                      the Banks and the L/C Bank
acknowledge that the Agent and/or the Security Trustee shall be under no
obligation to insure any property nor to require any other person to insure any
property and shall not be responsible for any loss which may be suffered by any
person as a result of the lack or insufficiency of any insurance; and

29.6                        The perpetuity period of the
trusts constituted or evidenced by this Agreement shall remain in full force
and effect until the earlier of the expiration of a period of eighty (60) years
from the date of this Agreement and the expiration of the Security Period.

29.7                        The Security Trustee and the
other Servicing Banks may not, except to the extent expressly authorised by the
other provisions of this Agreement or any Finance Document, agree amendments or
modifications to any of the Finance Documents, without the prior written
instructions of the Instructing Group or all the Banks as applicable.

29.8                        With respect to any sums due to
any Servicing Bank for its own account under this Agreement and/or the other
Finance Documents, such Servicing Bank shall have the same rights and powers
under this Agreement as the Banks and the L/C Bank and may exercise the same as
though it were not performing the duties and functions delegated to it under
this Agreement and the term “Bank” or “L/C Bank” shall, unless the context
clearly otherwise indicates, include each Servicing Bank in its individual
capacity.

29.9                        No Servicing Bank shall:

29.9.1                                      (save if otherwise expressly
provided herein) be obliged to request any certificate or opinion under this
Agreement or any of the other Finance Documents unless so

 

 

54

 

required in writing by the
Instructing Group, in which case the relevant Servicing Bank shall promptly
make the appropriate request or be obliged to make any enquiry as to any
default in the performance or observance of any of the provisions of this Agreement
or the other Finance Documents or as to the existence of an Event of Default
unless such Servicing Bank has actual knowledge thereof or has been notified in
writing thereof by any other
Creditor Party, in which case such Servicing Bank shall promptly notify the
other Creditor Parties of the relevant event or circumstance; or

29.9.2                                      be liable to any other Creditor
Party for any action taken or omitted under or in connection with this
Agreement and the other Finance Documents unless caused by its gross negligence
or wilful misconduct.

29.10                 Each Servicing Bank shall
(subject to its being indemnified to its satisfaction) take such action or, as
the case may be, refrain from taking such action with respect to any Event of
Default of which it has actual knowledge, as the Instructing Group may
reasonably direct.

29.11                 Each Bank and the L/C Bank
acknowledges that It has not relied on any statement, opinion, forecast or
other representation made by any Servicing Bank to induce it to enter into this
Agreement and/or the other Finance Documents and that it has made and will
continue to make, without reliance on any Servicing Bank and based on such
documents as it considers appropriate, its own appraisal of the
creditworthiness of the Borrowers and its own independent investigation of the
financial condition and affairs of the Borrowers in connection with the making
and continuation of the Facility under this Agreement. No Servicing Bank shall
have any duty or responsibility, either initially or on a continuing basis, to
provide the other Creditor Parties with any credit or other information with
respect to the Borrowers.

29.12                 No Servicing Bank shall have any
responsibility to any Bank or any other Creditor Party on account of the
failure of the Borrowers to perform their obligations under this Agreement
and/or the other Finance Documents or for the financial condition of the
Borrowers or for the completeness or accuracy of any statements,
representations or warranties in this Agreement and/or the other Finance Documents
or any document delivered under this Agreement and/or the other Finance
Documents or for the execution, effectiveness, adequacy, genuineness, validity,
enforceability or admissibility in evidence of this Agreement and/or the other
Finance Documents or of any certificate, report or other document executed or
delivered under this Agreement and/or the Security Documents or otherwise in
connection with the Facility or any part thereof made available pursuant to
this Agreement or its negotiation or for acting (or, as the case may be,
refraining from acting) in accordance with the instructions of the Instructing
Group. Each Servicing Bank shall be entitled to rely on any communication,
instrument or document believed by it to be genuine and correct and to have been
signed or sent by the proper person and shall be entitled to rely as to legal
or other professional matters on opinions and statements of any legal or other
professional advisers.

29.13                 Each Servicing Bank may, without
any liability to account to the Banks or to the L/C Bank or to any other
Creditor Party, accept deposits from, lend money to, and generally engage in
any kind of banking or trust business with, the Borrowers or any Bank or the L/C
Bank as if it were not a Servicing Bank.

29.14                 Each Bank (to the extent not
being reimbursed by the Borrowers) shall reimburse each Servicing Bank in the
proportion borne by its commitment to the Total Commitments, for the charges
and expenses incurred by such Servicing Bank in connection with the
negotiation, preparation, syndication, execution and, where relevant,
registration of this Agreement and the other Finance Documents and/or in
contemplation of, or otherwise in connection with, the enforcement of, or the
preservation of any rights under, or in carrying out its respective duties
under, this Agreement and the other Finance Documents including (in each case)
the fees and expenses of legal or other professional advisers. Each Bank (to
the extent not being reimbursed by the Borrowers) shall indemnify each Servicing
Bank in the proportion borne by its Commitment to the Total Commitments

 

 

55

 

against all liabilities,
damages, costs and claims whatsoever incurred by each Servicing Bank in
connection with this Agreement and the other Finance Documents or any action
taken or omitted by such Servicing Bank under this Agreement and the Security
Documents, unless such liabilities, damages, costs or claims arise from such
Servicing Bank’s own gross negligence or wilful misconduct.

29.15                 Each Servicing Bank shall have
full power to determine all questions and doubts arising in relation to the
interpretation or application of any of the provisions of this Agreement or any
of the Security Documents as it affects such Servicing Bank and every such
determination (whether made upon a question actually raised or implied in the
acts or proceedings of such Servicing Bank) shall be conclusive.

29.16                 In its capacity as trustee in
relation to the Finance Documents and in relation to the Trust Property, the
Security Trustee -

29.16.1                               shall, without prejudice to any
of the powers, discretions and immunities conferred upon trustees by law (and
to the extent not inconsistent with the provisions of this Agreement or any of
the other Finance Documents), have all the same powers and discretions as a
natural person acting as the beneficial owner of such property and/or as are
conferred upon the Security Trustee by this Agreement and/or any other Finance
Document provided that the Security Trustee may only exercise such powers and
discretions to the extent that the Security Trustee is authorised so to
exercise the same in accordance with the provisions of this Agreement and/or
any other Finance Document;

29.16.2                               shall be entitled to invest
moneys forming part of the Trust Property and which, in the opinion of the
Security Trustee may not be paid out promptly following receipt in the name or
under the control of the Security Trustee in any of the investments for the
time being authorised by law for the investment by trustees of trust moneys or
in any other property or investments whether similar to the aforesaid or not or
by placing the same on deposit in the name or under the control of the Security
Trustee as the Security Trustee may think fit without being under any duty to
diversify its investments and the Security Trustee may at any time vary or
transpose any such property or investments for or into any others of a like
nature and shall not be responsible for any loss due to depreciation in value
or otherwise of such property or investments (and on the basis that any
investment of any part or all of the Trust Property may, at the discretion of
the Security Trustee be made or retained in the names of nominees); and

29.16.3                               may, in the conduct of Its
obligations under and in respect of the Finance Documents (otherwise than in
relation to its right to make any declaration, determination or decision),
instead of acting personally, employ and pay any agent (whether being a lawyer
or any other person) to transact or concur in transacting any business and to
do or concur in doing any acts required to be done by the Security Trustee
(including the receipt and payment of money) on the basis that -

29.16.3.1                                             any such agent engaged in any
profession or business shall be entitled to be paid all usual professional and
other charges for business transacted and acts done by him or any partner or
employee of his in connection with such trusts; and

29.16.3.2                                             the Security Trustee shall not
be bound to supervise, or be responsible for any loss incurred by reason of any
act or omission of any such agent if the Security Trustee shall have exercised
reasonable care in the selection and instructions of such agent.

30                                  RETIREMENT
OF THE SERVICING BANKS

30.1                        Each Servicing Bank may and if
requested by the Instructing Group shall (which the Instructing Group may only
request if they have good cause to do so) retire from its appointment under
this Agreement and the other Finance Documents at any time and by

 

 

56

 

giving not less than 30 days
prior written notice to that effect to each of the other parties hereto,
provided that no such retirement shall be effective until a successor for such
Servicing Bank is appointed in accordance with the following provisions of this
Clause 30:

30.1.1                                      If any Servicing Bank gives
notice of its retiring pursuant to Clause 30.1, during the period of such
notice:

(a)                                  the retiring Servicing Bank may
appoint as successor Servicing Bank a banking corporation or financial
institution or related company owned by such retiring Servicing Bank by at
least 50% or another Bank or a banking corporation or financial institution or
related company owned by one of the Banks by at least 50%, without requiring
for such appointment the prior written consent and/or consultation of the
Instructing Group and/or the Borrowers, or such appointment not being
applicable;

(b)                                  the Instructing Group may
appoint as successor Servicing Bank any of the Banks, or failing such appointment;

(c)                                  the retiring Servicing Bank may
appoint as successor Servicing Bank any reputable and experienced bank or
financial institution or related company approved by the Instructing Group; or

30.1.2                                      if during the period of such
notice no successor is so appointed pursuant to sub-clauses 30.1.1(a), (b) and
(c), the retiring Servicing Bank may appoint a successor Servicing Bank itself
any reputable and experienced bank or financial institution nominated by such
retiring Servicing Bank;

and either the provisions of Clause 30.1.1 or 30.1.2 have been complied
with.

30.2                        Upon any such successor as
aforesaid being appointed, the retiring Servicing Bank shall be discharged from any further obligation
under this Agreement and the other Finance Documents and its successor and each
of the other parties to this Agreement and/or the other Finance Documents shall
have the same rights and obligations among themselves as they would have had if
such successor had been a party to this Agreement and/or the other Finance Documents
in place of the retiring Servicing Bank and the parties to this Agreement
and/or the other Finance Documents and the successor agent, successor paying
agent and the security trustee shall, prior to such retirement, execute such
amendments to this Agreement and/or the other Finance Documents as may be
necessary as a result of such substitution.

31                                  ASSIGNMENTS
AND TRANSFERS

31.1                        This Agreement shall be binding
upon and endure to the benefit of each party hereto and its successors and
permitted assigns and transferees.

31.2                        No Borrower (in any of its
capacities) shall be entitled to assign or transfer all or any of its rights,
benefits and obligations hereunder or under the Subject Documents.

31.3                        Any Bank may at any time assign
to any one or more banks or other financial institutions all or any part of
such Bank’s rights and benefits hereunder or transfer in accordance with Clause
31.5 all or any part of such Bank’s rights, benefits and obligations to any
bank or financial institution.

31.4                        If any Bank assigns all or any
of its rights and benefits hereunder in accordance with Clause 31.3, then,
unless and until the, relevant Bank, as transferor, the transferee and the
Borrowers have duly completed and duly executed a Transfer Certificate in
accordance with Clause 31.5, the other parties hereto shall not be obliged to
recognise such assignee as having the rights against each of them which it
would have had if it had been a party hereto.

 

 

57

31.5                        Subject
to the provisions of Clauses 31.6, 31.7, 31.8 and 31.9, if any Bank wishes to
transfer all or any part of its Commitment as contemplated in Clause 31.3, then
such transfer may be effected by the delivery to the Agent of a duly completed
and duly executed Transfer Certificate and upon the later of the date of
receipt by the Agent of such Transfer Certificate and the date of transfer
specified therein:

(a)                                  to
the extent that the Bank in question seeks to transfer its rights and/or
obligations, the Borrowers (on the one hand) and the Bank in question (on the
other) shall be released from all further obligations towards the other;

(b)                                  the
Borrowers (on the one hand) and the Transferee (on the other) shall assume
obligations towards the other identical to those released pursuant to Clause
31.5(a);

(c)                                  the
Commitment of such Bank party to such Transfer Certificate shall be reduced by
the amount expressed in such Transfer Certificate to be transferred to the
Transferee;

(d)                                  the
Transferee party to such Transfer Certificate shall become a party to this
Agreement as a Bank entitled to the rights and liable to observe the
obligations of a Bank with a Commitment equal to the amount expressed in such
Transfer Certificate to be transferred to such Transferee; and

(e)                                  the
other parties hereto shall acquire the same rights and benefits (including but
not limited to rights in the trust declared by the Security Trustee in Clause
29) and assume the same obligations between themselves vis-à-vis the Transferee
as they would have acquired and assumed had such Transferee been an original
party hereto as the Bank with a Commitment equal to the amount expressed in
such Transfer Certificate to be transferred to the Transferee.

31.6                        Each
of the parties hereto confirms that (a) the delivery to a Transferee of a
Transfer Certificate signed by a Bank constitutes an irrevocable offer by each
of the parties hereto to accept such Transferee (subject to the conditions set
out herein) as a Bank party hereto with the rights and obligations so expressed
to be transferred and (b) such offer may be accepted by such Transferee by the
execution of such Transfer Certificate by such Transferee and (c) the
provisions of this Agreement shall apply to the contract between the parties
thereto arising as a result of the acceptance of such offer.

31.7                        The
Transferee and all other relevant parties undertake to execute all further
documents, at the expense of the Transferee, to give effect and validity to the
required transfer of all interests in the Trust Property and Security Documents
in consequence of the Transfer Certificate.

31.8                        On
the date on which a transfer takes effect pursuant to this Clause 31 the
Transferee in respect of such transfer shall pay to the Agent for its own
account a fee of US$1,000.

31.9                        The
Agent shall not be obliged to accept any Transfer Certificate received by it
hereunder and no such Transfer Certificate may take effect on any day on or
after the receipt by the Agent of the Notice of Drawdown and prior to the
Drawdown Date.

31.10                 The
Borrowers, the Arranger, the Agent, the Security Trustee, each Bank and the Lit
Bank irrevocably authorises the Agent to sign Transfer Certificates on its
behalf.

31.11                 The
Agent shall promptly notify the other Creditor Parties of the receipt by it of
any Transfer Certificate, identifying in such notice the parties thereto in
their respective capacities and the portion of the Commitment transferred (as
specified in such Transfer Certificate}.

31.12                 The
Agent shall be fully entitled to rely on any Transfer Certificate delivered to
it in accordance with the foregoing provisions which is complete and regular on
its face as

 

58

 

regards its contents and
purportedly signed on behalf of the Bank and the Transferee and shall have no
liability or responsibility to any party as a consequence of placing reliance
upon and acting in accordance with any such Transfer Certificate.

31.13                 Any
Bank may provide or disclose to any actual or potential Transferee or assignee
or to any person who may otherwise enter into contractual relations with such
Bank in relation to this Agreement, a copy of this Agreement, copies of all
information provided by the Borrowers pursuant to each Subject Document to
which it is party, details of drawings made by the Borrowers thereunder,
information regarding the performance of the Borrowers of their obligations
thereunder.

31.14                 A
Bank may change its lending office by giving notice to the Agent and the change
shall become effective on the later of:

(a)                                  on
the date of which the Agent receives a notice; and

(b)                                  the
date, if any, specified in the notice as the date on which the change shall
come into effect.

31.15                 On
receiving such a notice, the Agent shall notify the Borrowers and the other
Creditor Parties and until the Agent receives such a notice, it shall be
entitled to assume that a Bank is acting through its lending office of which
the Agent last had notice.

32                                  LANGUAGE

Each
document, instrument, certificate or statement referred to herein or to be
delivered hereunder by the Borrowers shall, if not in the English language, be
accompanied by an English translation thereof certified by the Borrowers, which
translation shall prevail in the case of conflict with the non-English version.

33                                  NON-IMMUNITY

33.1                        The
Borrowers do not have any right of Immunity from set-off, suit or execution,
attachment or other legal process under the laws of England or any other
jurisdiction.

33.2                        The
exercise by the Borrowers of their rights and performance and discharge of
their duties and liabilities hereunder will constitute commercial acts done and
performed for private and commercial purposes.

33.3                        To
the extent that the Borrowers may in any jurisdiction, in which proceedings may
at any time be taken for the enforcement of this Agreement and/or any of the
other Finance Documents, claim for themselves or their assets immunity from
suit, judgment, execution, attachment (whether in aid of execution, before
judgment or otherwise) or other legal process, and to the extent that in any
such jurisdiction there may be attributed to itself or its assets any such
immunity (whether or not claimed), the Borrowers hereby irrevocably agree not
to claim and hereby irrevocably waive any such immunity to the full extent permitted
by the laws of such jurisdiction.

34                                  NOTICES

34.1                        Unless
otherwise specifically provided, any notice under or in connection with any
Finance Document shall be given by 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.

34.2                        A
notice shall be sent:

(a)                                  to
the Borrowers:         C/o AEGEAN
BUNKERING SERVICES INC.

                                                        42,
Hadjikyriakou Street 

 

59

 

Piraeus 185 38, Greece 

Fax nr: + (30 210) 458 6242

(b)                                  to
a Bank:                                                                  At
the address below its name in Schedule 1 or (as 

the case may require) in the relevant Transfer Certificate

(c)                                  to
the Arranger, the Agent

and

the Security Trustee:                                                   AEGEAN
BALTIC BANK S.A.

28 Diligianni Street

145 62 Kifissia

Greece

Fax No: + (30 210) 623 4192/3

 

(d)                                  to
the L/C Bank:                                                                                HSH
NORDBANK AG 

Gerhart-Hauptmann-Platz 50 

20095 Hamburg

Germany

Fax Nr: 004940 333334118

or
to such other address as the relevant party may notify the Servicing Banks or,
if the relevant party is a Creditor Party or a Servicing Bank, the L/C Bank,
the Borrowers, the other Creditor Parties and the Security Parties.

34.3                        Subject
to Clauses 34.4 and 34.5:

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

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

34.4                        However,
if under Clause 34.3 a notice would be deemed to be served:

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

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

the
notice shall (subject to Clause 34.5) be deemed to be served, and shall take effect,
at 9 a.m. on the next day which is such a Business Day.

34.5                        Clauses
34.3 and 34.4 do not apply if the recipient of a notice notifies the sender
within one 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.

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

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

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

35                                  SUPPLEMENTAL

 

60

 

35.1                        The
rights and remedies which the Finance Documents give to each Creditor Party
are:

35.1.1                                      cumulative;

35.1.2                                      may
be exercised as often as appears expedient; and

35.1.3                                      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.

35.2                        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.

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

35.4                        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.

36                                  LAW AND JURISDICTION

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

36.2                        Subject
to Clause 36.3, the courts of England shall have exclusive jurisdiction to
settle any disputes, which may arise out of or in connection with this
Agreement.

36.3                        Clause
36.2 is for the exclusive benefit of the Creditor Parties, each of which
reserves the right

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

36.3.2                                      to
commence such proceedings in the courts of any such country or countries
concurrently with or In addition to proceedings in England or Greece or without
commencing proceedings in England or Greece.

The
Borrowers 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.

36.4                        Each
of the Borrowers irrevocably appoints Messrs. RICHES CONSULTING, presently at
Old Jarretts Farm House, Brantbridge Lane, Balcombe, West Sussex, RH176JR,
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.

36.5                        Each
of the Borrowers irrevocably designates and appoints Mr. SPYRIDON FOKAS, an
attorney-at-law with offices at 53, Filonos Street, Piraeus, Greece, as agent
for the service of process in Greece (“antilditos”)
and agrees to consider any legal process or any demand or notice
made served on behalf of the Creditor Parties and/or the Security Trustee on
the said agent as being made to the Borrowers. The designation of such an
authorized agent (“antiklitoe) shall
remain irrevocable until all Indebtedness shall have been paid in full in
accordance with the terms of this Agreement and the other Finance Documents.

36.6                        Each
of the Borrowers irrevocably waives any objection which it may now or in the
future have to the laying of the venue of any proceedings in any court referred
to in this Clause, and any claim that those proceedings have been brought in an
inconvenient or 

 

61

 

inappropriate forum, and irrevocably agrees that a judgment in
any proceedings commenced in any such court shalt be conclusive and binding on
it and may be enforced in the courts of any other jurisdiction.

36.7                        Nothing
in this Clause 36 shall exclude or limit any right which any Creditor Party 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.

36.8                        In
this Clause 36, “proceedings” means proceedings of any kind, including an application
for a provisional or protective measure or enforcement court order (diatagi piiromis).

37                                  THIS AGREEMENT AND THE OTHER FINANCE DOCUMENTS

In
case of any conflict between the provisions of this Agreement and any of the
other Finance Documents the provisions of this Agreement shall prevail.

AS
WITNESS the hands of the duty authorised representatives of the parties hereto
the day and year first before written,

THE
BORROWERS

	
  Signed by

  _____________________________

  The duly authorized attorney-in-fact

  for and on behalf of

  OCEAN
  DYNAMIC CORP.

  in the presence of:

  	
  )

  )

  )

  )

  )

  )

  )

  
	
   

  	
   

  
	
  Signed by

  _____________________________

  The duly authorized attorney-in-fact

  for and on behalf of

  SEA
  GLOBAL S.A.

  in the presence of:

  	
  )

  )

  )

  )

  )

  )

  )

  

THE
BANKS

	
  Signed by

  _____________________________

  The duly authorized attorney-in-fact

  for and on behalf of

  HSH
  NORDBANK AG

  in its capacity as Bank

  in the presence of:

  	
  )

  )

  )

  )

  )

  )

  )

  

 

 

62

 

	
   

  	
   

  
	
  Signed by

  _____________________________

  The duly authorized attorney-in-fact

  for and on behalf of

  AEGEAN
  BALTIC BANK S.A.

  in its capacity as Bank

  in the presence of:

  	
  )

  )

  )

  )

  )

  )

  )

  
	
   

  	
   

  

THE L/C
BANK

	
  Signed by

  _____________________________

  The duly authorized attorney-in-fact

  for and on behalf of

  HSH NORDBANK
  AG

  in its capacity as the L/C Bank

  in the presence of:

  	
  )

  )

  )

  )

  )

  )

  )

  
	
   

  	
   

  
	
  Signed by

  _____________________________

  The duly authorized attorney-in-fact

  for and on behalf of

  OCEAN
  DYNAMIC CORP.

  in the presence of:

  	
  )

  )

  )

  )

  )

  )

  )

  

THE
ARRANGER, THE AGENT AND SECURITY TRUSTEE

	
  Signed by

  _____________________________

  The duly authorized attorney-in-fact

  for and on behalf of

  AEGEAN
  BALTIC BANK S.A.

  in its capacity as the Arranger,

  the Agent and Security Trustee

  in the presence of:

  	
  )

  )

  )

  )

  )

  )

  )

  
	
   

  	
   

  

 

 

SK 23250 0002 821903 v2

 

 

63Exhibit 10.38

 

Private & Confidential

 

 

LOAN AGREEMENT

for a

Loan of up to US$37,560,000

to

ANDROS MARINE INC.

DILOS MARINE INC.

IOS MARINE INC.

SIFNOS MARINE INC.

and

TINOS MARINE INC.

 

provided by

THE ROYAL BANK OF SCOTLAND PLC

 

 

NORTON ROSE

 

 

THIS AGREEMENT is
dated 5 July 2007 and made BETWEEN:

 

(1)                      ANDROS MARINE INC., DILOS
MARINE INC., IOS MARINE INC., SIFNOS MARINE INC. and TINOS
MARINE INC. as joint and several Borrowers; and

 

(2)                      THE ROYAL BANK OF SCOTLAND PLC as Bank.

 

IT IS AGREED
as follows:

 

1.                                                Purpose and definitions

 

1.1                                         Purpose

 

This Agreement
sets out the terms and conditions upon and subject to which the Bank agrees to
make available to the Borrowers, jointly and severally, a loan of up to Thirty
seven million five hundred and sixty thousand Dollars ($37,560,000) in twenty
five (25) Advances to be used for the purpose of financing part of the Total
Construction Cost of all the Ships.

 

1.2                                         Definitions

 

In this
Agreement, unless the context otherwise requires:

 

“Additional
Cost” means, in relation to any period, a percentage
calculated for such period at an annual rate determined in the manner set out
in schedule 10;

 

“Advances”
means each borrowing of a proportion of the Commitment by the Borrowers or (as
the context may require) the principal amount of such borrowing, it includes
(i) each Andros Pre-delivery Advance, (ii) the Andros Delivery
Advance, (iii) each Dilos Pre-delivery Advance, (iv) the Dilos
Delivery Advance, (v) each Ios Pre-delivery Advance, (vi) the Ios
Delivery Advance, (vii) each Sifnos Pre-delivery Advance, (viii) the
Sifnos Delivery Advance, (ix) each Tinos Pre-delivery Advance and (x) the
Tinos Delivery Advance, and:

 

(a)                        in relation to the Andros Ship
and the Andros Tranche, it means the Andros Advances;

 

(b)                       in relation to the Dilos Ship
and the Dilos Tranche, it means the Dilos Advances;

 

(c)                        in relation to the Ios Ship and
the Ios Tranche, it means the Ios Advances;

 

(d)                       in relation to the Sifnos Ship
and the Sifnos Tranche, it means the Sifnos Advances; or

 

(e)                        in relation to the Tinos Ship
and the Tinos Tranche, it means the Tinos Advances,

 

and “Advance” means any of them;

 

“Andros
Advances” means, together, the Andros Pre-delivery
Advances and the Andros Delivery Advance and “Andros
Advance” means any of them;

 

“Andros
Borrower” means Andros Marine Inc. of 80 Broad Street,
Monrovia, Republic of Liberia and includes its successors in title;

 

“Andros Contract” means the shipbuilding contract dated 25 May
2007, made between the Builder and the Andros Borrower, as may be further
amended, supplemented, varied, replaced or novated from time to time with the
prior written consent of the Bank, relating to the construction and sale by the
Builder, and the purchase by the Andros Borrower, of the Andros Ship;

 

1

 

“Andros
Contract Assignment Consent and Acknowledgement” means
the acknowledgement of notice of, and consent to, the assignment in respect of
the Andros Contract to be given by the Builder in the form scheduled to the
Andros Pre-delivery Security Assignment;

 

“Andros
Contract Price” means Seven million eight hundred and
ninety thousand Dollars ($7,890,000) or such other lesser sum in Dollars as may
be payable by the Andros Borrower to the Builder pursuant to the Andros Contract
as the purchase price for the Andros Ship thereunder;

 

“Andros
Deed of Covenant” means the first priority deed of
covenant and/or general assignment collateral to the Andros Mortgage executed
or (as the context may require) to be executed by the Andros Borrower in favour
of the Bank in such form as the Bank may require in its sole discretion;

 

“Andros
Delivery Advance” means an Advance of up to $4,040,400
made or (as the context may require) to be made available to the Borrowers for
the purpose of (a) financing in part the final instalment of the Andros
Contract Price falling due on the Delivery Date for the Andros Ship and (b) (as
to the balance) financing the payment of any other part of the Total
Construction Cost for the Andros Ship previously paid by the Andros Borrower
and not financed by this Agreement;

 

“Andros
First Advance” means an Advance of up to $631,200 made
or (as the context may require) to be made available to the Borrowers for the
purpose of financing in part the payment of the first instalment of the Andros
Contract Price falling due before the Delivery Date for the Andros Ship as set
out in schedule 3;

 

“Andros
Fourth Advance” means an Advance of up to $946,800
made or (as the context may require) to be made available to the Borrowers for
the purpose of financing in part the payment of the fourth instalment of the
Andros Contract Price falling due before the Delivery Date for the Andros Ship
as set out in schedule 3;

 

“Andros
Management Agreement” means the management agreement
made or (as the context may require) to be made between the Andros Borrower and
the Manager in a form previously approved in writing by the Bank providing
(inter alia) for the Manager to manage the Andros Ship;

 

“Andros
Managers Undertaking” means the first priority
undertaking and assignment in relation to the Andros Ship executed or (as the
context may require) to be executed by the Manager in favour of the Bank in
such form as the Bank may require in its sole discretion;

 

“Andros
Mortgage” means the first priority or (as the case may
be) preferred mortgage of the Andros Ship executed or (as the context may
require) to be executed by the Andros Borrower in favour of the Bank in such
form as the Bank may require in its sole discretion;

 

“Andros
Operating Account” means an interest bearing Dollar
account of the Andros Borrower opened or (as the context may require) to be
opened by the Andros Borrower with the Bank and includes any sub-accounts
thereof and any other account designated in writing by the Bank to be an Andros
Operating Account for the purposes of this Agreement;

 

“Andros
Pre-delivery Advances” means, together, the Andros
First Advance, the Andros Second Advance, the Andros Third Advance and the
Andros Fourth Advance and “Andros Pre-delivery
Advance” means any of them;

 

“Andros
Pre-delivery Security Assignment” means the assignment
of the Andros Contract and the Andros Refund Guarantees executed or (as the
context may require) to be executed by the Andros Borrower in favour of the
Bank in the form set out in schedule 4;

 

2

 

“Andros
Refund Guarantee Assignment Consent and Acknowledgement”
means, in relation to each Andros Refund Guarantee, an acknowledgement of
notice of, and consent to, the assignment in respect of that Andros Refund
Guarantee to be given by a Refund Guarantor in the form scheduled to the Andros
Pre-delivery Security Assignment and “Andros Refund Guarantee
Assignment Consents and Acknowledgements” means any or all of them;

 

“Andros
Refund Guarantees” means, together, the letter of
guarantee no. LGD6600200700014 dated 8 June 2007 (as amended on 3 July 2007)
issued by Bank of Communications, Fuzhou Branch as Refund Guarantor in respect
of certain of the Builders obligations under the Andros Contract and any other
letters of guarantee to be issued by a Refund Guarantor in respect of the
Builder’s obligations under the Andros Contract, pursuant to the Andros
Contract or any agreement supplemental to the Andros Contract, and any
extensions, renewals or replacements to or of any such guarantee(s), in each
case in form and substance acceptable to the Bank in its sole discretion and “Andros Refund Guarantee” means any of them;

 

“Andros
Second Advance” means an Advance of up to $946,800
made or (as the context may require) to be made available to the Borrowers for
the purpose of financing in part the payment of the second instalment of the
Andros Contract Price falling due before the Delivery Date for the Andros Ship
as set out in schedule 3;

 

“Andros
Ship” means the 3,800 dwt (approximately) double-hull
oil product tanker currently known as Hull No. DN-3500-11, to be constructed
and sold by the Builder to the Andros Borrower pursuant to the Andros Contract
and to be registered on the Delivery Date for such Ship in the ownership of the
Andros Borrower through the relevant Registry under the laws and flag of the
relevant Flag State;

 

“Andros
Third Advance” means an Advance of up to $946,800 made
or (as the context may require) to be made available to the Borrowers for the
purpose of financing in part the payment of the third instalment of the Andros
Contract Price falling due before the Delivery Date for the Andros Ship as set
out in schedule 3;

 

“Andros
Tranche” means a tranche of the Loan of up to
$7,512,000 to be drawn down in not more than five (5) Advances (being the
Andros Advances);

 

“Assignee”
has the meaning ascribed thereto in clause 153;

 

“Bank”
means The Royal Bank of Scotland plc whose registered office is at 36 St.
Andrew Square, Edinburgh EH2 2YB, Scotland acting for the purposes of this
Agreement through its branch at 45 Akti Miaouli, 185 36 Piraeus, Greece (or of
such other address as may last have been notified to the Borrowers pursuant to
clause 15.6) and includes its successors in title, Assignees and/or
Transferees;

 

“Banking
Day” means a day on which dealings in deposits in
Dollars are carried on in the London Interbank Eurocurrency Market and (other
than Saturday or Sunday) on which banks are open for business in London,
Piraeus and New York City (or any other relevant place of payment under clause
6);

 

“Borrowed
Money” means Indebtedness incurred in respect of (i)
money borrowed or raised and debit balances at banks, (ii) any bond, note, loan
stock, debenture or similar debt instrument, (iii) acceptance or documentary
credit facilities, (iv) receivables sold or discounted (otherwise than on a
non-recourse basis), (v) deferred payments for assets or services acquired,
(vi) finance leases and hire purchase contracts, (vii) swaps, forward exchange
contracts, futures and other derivatives, (viii) any other transaction
(including without limitation forward sale or purchase agreements) having the
commercial effect of a borrowing or raising of money or of any of (ii) to (vii)
above and (ix) guarantees in respect of Indebtedness of any person falling
within any of (i) to (viii) above;

 

3

 

“Borrower”
means:

 

(a)                        in relation to the Andros Ship,
the Andros Borrower,

 

(b)                       in relation to the Dilos Ship,
the Dilos Borrower;

 

(c)                        in relation to the Ios Ship, the
Ios Borrower;

 

(d)                       in relation to the Sifnos Ship,
the Sifnos Borrower; or

 

(e)                        in relation to the Tinos Ship,
the Tinos Borrower,

 

and “Borrowers” means any or all of them;

 

“Borrowers’
Security Documents” means, at any relevant time, such
of the Security Documents as shall have been executed by any of the Borrowers
at such time;

 

“Builder”
means Fujian Southeast Shipyard, a corporation duly organized and existing
under the laws of the People’s Republic of China, having its registered office
at 7# Jianshe Road, Economic Technical Development Zone of Fuzhou, Fujian
Province, The People’s Republic of China and includes its successors in title;

 

“Casualty
Amount” means, in relation to each Ship, Two hundred
and fifty thousand Dollars ($250,000) or the equivalent in any other currency;

 

“Classification”
means, in relation to each Ship, the classification “+A1 OIL CARRIER (E) ESP,
FP.<60°C, + ACC + AMS” with the relevant Classification Society or such
other classification as the Bank shall, at the request of a Borrower, have
agreed in writing shall be treated as the Classification in relation to such
Borrower’s Ship for the purposes of the relevant Ship Security Documents;

 

“Classification
Society” means, in relation to each Ship, American
Bureau of Shipping or such other classification society which the Bank shall,
at the request of a Borrower, have agreed in writing shall be treated as the
Classification Society in relation to such Borrower’s Ship for the purposes of
the relevant Ship Security Documents;

 

“Code”
means the International Management Code for the Safe Operation of Ships and for
Pollution Prevention constituted pursuant to Resolution A. 741(18) of the
International Maritime Organisation and incorporated into the International
Convention on Safety of Life at Sea 1974 (as amended) and includes any
amendments or extensions thereto and any regulation issued pursuant thereto;

 

“Commitment”
means the amount which the Bank has agreed to lend to
the Borrowers under clause 2.1 as reduced by any relevant term of this
Agreement;

 

“Compulsory
Acquisition” means, in relation to a Ship, requisition
for title or other compulsory acquisition, requisition, appropriation,
expropriation, deprivation, forfeiture or confiscation for any reason of that
Ship by any Government Entity or other competent authority, whether de jure or
de facto, but shall exclude requisition for use or hire not involving
requisition of title;

 

“Contract”
means:

 

(a)                        in relation to the Andros Ship,
the Andros Contract;

 

(b)                       in relation to the Dilos Ship,
the Dilos Contract;

 

4

 

(c)                        in relation to the Ios Ship, the
Ios Contract;

 

(d)                       in relation to the Sifnos Ship,
the Sifnos Contract; or

 

(e)                        in relation to the Tinos Ship,
the Tinos Contract,

 

and “Contracts” means any or all of them;

 

“Contract
Assignment Consent and Acknowledgement” means:

 

(a)                        in relation to the Andros Ship, the
Andros Contract Assignment Consent and Acknowledgement

 

(b)                       in relation to the Dilos Ship,
the Dilos Contract Assignment Consent and Acknowledgement;

 

(c)                        in relation to the Ios Ship, the
Ios Contract Assignment Consent and Acknowledgement

 

(d)                       in relation to the Sifnos Ship,
the Sifnos Contract Assignment Consent and Acknowledgement; or

 

(e)                        in relation to the Tinos Ship,
the Tinos Contract Assignment Consent and Acknowledgement,

 

and “Contract Assignment Consents and Acknowledgements” means
any or all of them;

 

“Contract
Price” means:

 

(a)                        in relation to the Andros Ship,
the Andros Contract Price;

 

(b)                       in relation to the Dios Ship,
the Dilos Contract Price;

 

(c)                        in relation to the Ios Ship, the
Ios Contract Price;

 

(d)                       in relation to the Sifnos Ship,
the Sifnos Contract Price; or

 

(e)                        in relation to the Tinos Ship,
the Tinos Contract Price,

 

and “Contract Prices” means any or all of them;

 

“Corporate
Guarantee” means the corporate guarantee executed or
(as the context may require) to be executed by the Corporate Guarantor in
favour of the Bank in the form set out in schedule 5;

 

“Corporate
Guarantor” means Aegean Marine Petroleum Network Inc.
of Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall
Islands MH96960 and includes its successors in title;

 

“Credit
Support Document” has the meaning given to that expression
in section 14 of the Master Swap Agreement and as set out in paragraph (f) of
Part 4 of the Schedule to the Master Swap
Agreement

 

“Credit
Support Provider” means any person defined as such in the Master Swap Agreement
pursuant to section 14 of the Master Swap Agreement;

 

5

 

“Deed
of Covenant” means:

 

(a)                        in relation to the Andros Ship,
the Andros Deed of Covenant;

 

(b)                       in relation to the Dilos Ship,
the Dilos Deed of Covenant;

 

(c)                        in relation to the Ios Ship, the
Ios Deed of Covenant

 

(d)                       in relation to the Sifnos Ship,
the Sifnos Deed of Covenant; or

 

(e)                        in relation to the Tinos Ship,
the Tinos Deed of Covenant,

 

and “Deeds of Covenant” means
any or all of them;

 

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

 

“Delivery”
means, in relation to each Ship, the delivery of such Ship by the Builder to,
and the acceptance of such Ship by, the relevant Borrower pursuant to the
relevant Contract;

 

“Delivery
Advance”:

 

(a)                        in relation to the Andros Ship
and the Andros Tranche, means the Andros Delivery Advance;

 

(b)                       in relation to the Dilos Ship
and the Dilos Tranche, means the Dilos Delivery Advance;

 

(c)                        in relation to the Ios Ship and
the Ios Tranche, means the Ios Delivery Advance;

 

(d)                       in relation to the Sifnos Ship
and the Sifnos Tranche, means the Sifnos Delivery Advance; or

 

(e)                        in relation to the Tinos Ship
and the Tinos Tranche, means the Tinos Delivery Advance,

 

and “Delivery Advances” means any or all of them;

 

“Delivery
Date” means, in relation to each Ship, the date upon
which its Delivery occurs;

 

“Dilos
Advances” means, together, the Dilos Pre-delivery
Advances and the Dilos Delivery Advance and “Dilos
Advance” means any of them;

 

“Dilos
Borrower” means Dilos Marine Inc. of 80 Broad Street,
Monrovia, Republic of Liberia and includes its successors in title;

 

“Dilos
Contract” means the shipbuilding contract dated 25 May
2007, made between the Builder and the Dilos Borrower, as may be further
amended, supplemented, varied, replaced or novated from time to time with the
prior written consent of the Bank, relating to the construction and sale by the
Builder, and the purchase by the Dilos Borrower, of the Dilos Ship;

 

“Dilos
Contract Assignment
Consent and Acknowledgement” means the acknowledgement of
notice of, and consent to, the assignment in respect of the Dilos Contract to
be given by the Builder in the form
scheduled to the Dilos Pre-delivery
Security Assignment

 

6

 

“Dilos
Contract Price” means Seven million eight hundred and ninety thousand Dollars
($7,890,000) or such other lesser sum in Dollars as may be payable by the Dilos
Borrower to the Builder pursuant to the Dilos Contract as the purchase price
for the Dilos Ship thereunder;

 

“Dilos
Deed of Covenant” means the first priority deed of covenant and/or general
assignment collateral to the Dilos Mortgage executed or (as the context may
require) to be executed by the Dilos Borrower in favour of the Bank in such
form as the Bank may require in its sole discretion;

 

“Dilos
Delivery Advance” means an Advance of up to $4,040,400
made or (as the context may require) to be made available to the Borrowers for
the purpose of (a) financing in part the final instalment of the Dilos Contract
Price falling due on the Delivery Date for the Dilos Ship and (b) (as to the
balance) financing the payment of any other part of the Total Construction Cost
for the Dilos Ship previously paid by the Dilos Borrower and not financed by
this Agreement

 

“Dilos
First Advance” means an Advance of up to $631,200 made
or (as the context may require) to be made available to the Borrowers for the
purpose of financing in part the payment of the first instalment of the Dilos
Contract Price falling due before the Delivery Date for the Dilos Ship as set
out in schedule 3;

 

“Dilos
Management Agreement” means the management agreement made
or (as the context may require) to be made between the Dilos Borrower and the
Manager in a form previously approved in writing by the Bank providing (inter alia) for the Manager to manage the
Dilos Ship;

 

“Dilos
Fourth Advance” means an Advance of up to $946,800
made or (as the context may require) to be made available to the Borrowers for
the purpose of financing in part the payment of the fourth instalment of the
Dilos Contract Price falling due before the Delivery Date for the Dilos Ship as
set out in schedule 3;

 

“Dilos Manager’s Undertaking”
means the first priority undertaking and assignment in relation to the Dilos
Ship executed or (as the context may require) to be executed by the Manager in
favour of the Bank in such form as the Bank may require in its sole discretion;

 

“Dilos Mortgage” means the first priority or (as the
case may be) preferred mortgage of the Dilos Ship executed or (as the context
may require) to be executed by the Dilos Borrower in favour of the Bank in such
form as the Bank may require in its sole discretion;

 

“Dilos
Operating Account” means an interest bearing Dollar
account of the Dilos Borrower opened or (as the context may require) to be
opened by the Dilos Borrower with the Bank and includes any sub-accounts thereof
and any other account designated in writing by the Bank to be a Dilos Operating
Account for the purposes of this Agreement;

 

“Dilos Pre-delivery Advances” means, together, the Dilos First
Advance, the Dilos Second Advance, the Dilos Third Advance and the Dilos Fourth
Advance and “Dilos Pre-delivery Advance” means
any of them;

 

“Dilos
Pre-delivery Security Assignment” means the assignment
of the Dilos Contract and the Dilos Refund Guarantees executed or (as the
context may require) to be executed by the Dilos Borrower in favour of the Bank
in the form set out in schedule 4;

 

“Dilos
Refund Guarantee
Assignment Consent and Acknowledgement” means, in relation to each Dilos
Refund Guarantee, an acknowledgement of notice of, and consent to, the
assignment in respect of that Dilos Refund Guarantee to be given by a Refund
Guarantor in the form scheduled to the Dilos Pre-delivery Security Assignment
and “Dilos Refund Guarantee Assignment
Consents and Acknowledgements”
means any or all of them;

 

7

 

“Dilos
Refund Guarantees” means, together, the letter of
guarantee no. LGD6600200700013 dated 8 June 2007 (as amended on 3 July 2007)
issued by Bank of Communications, Fuzhou Branch as Refund Guarantor in respect
of certain of the Builder’s obligations under the Dilos Contract and any other
letters of guarantee to be issued by a Refund Guarantor in respect of the
Builders obligations under the Dilos Contract, pursuant to the Dilos Contract
or any agreement supplemental to the Dilos Contract, and any extensions,
renewals or replacements to or of any such guarantee(s), in each case in form
and substance acceptable to the Bank in its sole discretion and “Dilos Refund Guarantee” means any of them;

 

“Dilos
Second Advance” means an Advance of up to $946,800 made or (as the context may require)
to be made available to the Borrowers for the purpose of financing in part the
payment of the second instalment of the Dilos Contract Price falling due before
the Delivery Date for the Dilos Ship as set out in schedule 3;

 

“Dilos
Ship” means the 3,800 dwt (approximately) double-hull
oil product tanker currently known as Hull No. DN-3500-12, to be constructed
and sold by the Builder to the Dilos Borrower pursuant to the Dilos Contract
and to be registered on the Delivery Date for such Ship in the ownership of the
Dilos Borrower through the relevant Registry under the laws and flag of the
relevant Flag State;

 

“Dilos
Third Advance” means an Advance of up to $946,800 made
or (as the context may require) to be made available to the Borrowers for the
purpose of financing in part the payment of the third instalment of the Dilos
Contract Price falling due before the Delivery Date for the Dilos Ship as set
out in schedule 3;

 

“Dilos
Tranche” means a tranche of the Loan of up to
$7,512,000 to be drawn down by not more than five (5) Advances (being the Dilos
Advances);

 

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

 

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

 

“Drawdown
Date” means, in relation to an Advance, any date,
being a Banking Day falling during the relevant Drawdown Period, on which the
Borrowers request that Advance to be made as specified in the relevant Drawdown
Notice (whether or not such Advance is actually made or not);

 

“Drawdown
Notice” means a notice substantially in the terms of schedule 1;

 

“Drawdown
Period” means, in relation to an Advance, the period
commencing on the date of this
Agreement and ending on the relevant Termination Date or the period ending on
such earlier date (if any) on
which (a) the aggregate amount of all Advances is equal to the Commitment or
(b) the Commitment is reduced to zero pursuant to clauses 4.3, 10.2 or 12 or
(c) Delivery of the Ship relevant to such Advance occurs;

 

“Earnings”
means, in relation to a Ship, all moneys whatsoever from time to time due or
payable to a Borrower during the Security Period arising out of the use or
operation of such Borrower’s Ship including (but without limiting the
generality of the foregoing) all freight, hire and passage moneys, income
arising out of pooling arrangements, compensation payable to such Borrower in
the event of requisition of such Borrower’s Ship for hire, remuneration for
salvage or towage services, demurrage and detention moneys and damages for
breach (or payment for 

 

8

 

variation or
termination) of any charterparty or other contract for the employment of such
Borrower’s Ship;

 

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

 

“Environmental
Affiliate” means any agent or employee of any Borrower
or any other Relevant Party or any person having a contractual relationship
with any Borrower or any other Relevant Party in connection with any Relevant
Ship or its operation or the carriage of cargo and/or passengers thereon and/or
the provision of goods and/or services on or from any Relevant Ship;

 

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

 

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

 

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

 

“Event of Default” means any of the events or
circumstances described in clause 10.1; “First Advance”:

 

(a)                        in relation to the Andros Ship
and the Andros Tranche, means the Andros First Advance;

 

(b)                       in relation to the Dilos Ship
and the Dilos Tranche, means the Dilos First Advance;

 

(c)                        in relation to the Ios Ship and
the Ios Tranche, means the Ios First Advance;

 

(d)                       in relation to the Sifnos Ship
and the Sifnos Tranche, means the Sifnos First Advance; or

 

(e)                        in relation to the Tinos Ship
and the Tinos Tranche, means the Tinos First Advance, and “First Advances”
means any or all of them;

 

“First
Repayment Date” means, in relation to each Tranche
(and subject to clause 6.3), the date falling three (3) months after the
earlier of (a) the Drawdown Date of the Delivery Advance relevant to such
Tranche and (b) the Termination Date for the Delivery Advance relevant to such
Tranche;

 

“Flag
State” means, in relation to each Ship, such state or
territory designated in writing by the Bank in its absolute discretion, at the
request of the relevant Borrower, as being the “Flag State” of
such Ship for the purposes of the relevant Ship Security Documents;

 

9

 

“Fourth
Advance”:

 

(a)                        in relation to the Andros Ship
and the Andros Tranche, means the Andros Fourth Advance;

 

(b)                       in relation to the Dilos Ship
and the Dilos Tranche, means the Dilos Fourth Advance;

 

(c)                        in relation to the Ios Ship and
the los Tranche, means the Ios Fourth Advance;

 

(d)                       in relation to the Sifnos Ship
and the Sifnos Tranche, means the Sifnos Fourth Advance; or

 

(e)                        in relation to the Tinos Ship
and the Tinos Tranche, means the Tinos Fourth Advance,

 

and “Fourth Advances” means any or all of them;

 

“Government
Entity” means and includes (whether having a distinct
legal personality or not) any national or local government authority, board,
commission, department, division, organ, instrumentality, court or agency and
any association, organisation or institution of which any of the foregoing is a
member or to whose jurisdiction any of the foregoing is subject or in whose
activities any of the foregoing is a participant;

 

“Group”
means the Corporate Guarantor and its Subsidiaries from time to time
(including, for the avoidance of doubt, the Borrowers and the Manager) and “member of Group” shall be construed accordingly;

 

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

 

“Insurance
Letter” means, in respect of a Ship, a letter from the
Borrower owning such Ship in the form set out in schedule 8;

 

“Insurances”
means, in relation to a Ship, all policies and contracts of insurance (which
expression includes all entries of that Ship in a protection and indemnity or
war risks association) which are from time to time during the Security Period
in place or taken out or entered into by or for the benefit of the relevant
Borrower (whether in the sole name of such Borrower, or in the joint names of
such Borrower and the Bank or otherwise) in respect of such Borrower’s Ship and
her Earnings or otherwise howsoever in connection with such Ship and all
benefits thereof (including claims of whatsoever nature and return of
premiums);

 

“Interest
Payment Date” means the last day of an Interest
Period;

 

“Interest
Period” means, in relation to any Advance or Tranche,
each period for the calculation of interest in respect of such Advance or, as
the case may be, Tranche, ascertained in accordance with clauses 3.2 and 3.3;

 

“Interest
Period Letter” means the letter addressed by the
Borrowers to the Bank, such letter to be substantially in the form set out in
schedule 9;

 

“Ios
Advances” means, together, the Ios Pre-delivery
Advances and the Ios Delivery Advance and “Ios
Advance” means any of them;

 

“Ios
Borrower” means Ios Marine Inc. of 80 Broad Street,
Monrovia, Republic of Liberia and includes its successors in title;

 

“Ios
Contract” means the shipbuilding contract dated 25 May
2007, made between the Builder and the Ios Borrower, as may be further amended,
supplemented, varied, replaced or novated 

 

10

 

from time to
time with the prior written consent of the Bank, relating to the construction
and sale by the Builder, and the purchase by the Ios Borrower, of the Ios Ship;

 

“Ios
Contract Assignment Consent and Acknowledgement” means the acknowledgement of
notice of, and consent to, the assignment in respect of the Ios Contract to be
given by the Builder in the form scheduled to the Ios Pre-delivery Security
Assignment;

 

“Ios
Contract Price” means Seven million eight hundred and
ninety thousand Dollars ($7,890,000) or such other lesser sum in Dollars as may
be payable by the Ios Borrower to the Builder pursuant to the Ios Contract, as
the purchase price for the Ios Ship thereunder;

 

“Ios
Deed of Covenant” means the first priority deed of
covenant and/or general assignment collateral to the Ios Mortgage executed or
(as the context may require) to be executed by the Ios Borrower in favour of
the Bank in such form as the Bank may require in its sole discretion;

 

“Ios
Delivery Advance” means an Advance of up to $4,040,400
made or (as the context may require) to be made available to the Borrowers for
the purpose of (a) financing in part the final instalment of the Ios Contract
Price falling due on the Delivery Date for the Ios Ship and (b) (as to the
balance) financing the payment of any other part of the Total Construction Cost
for the Ios Ship previously paid by the Ios Borrower and not financed by this
Agreement

 

“Ios
First Advance” means an Advance of up to $631,200 made
or (as the context may require) to be made available to the Borrowers for the
purpose of financing in part the payment of the first instalment of the Ios
Contract Price falling due before the Delivery Date of the Ios Ship as set out
in schedule 3;

 

“Ios
Fourth Advance” means an Advance of up to $946,800
made or (as the context may require) to be made available to the Borrowers for
the purpose of financing in part the payment of the fourth instalment of the Ios
Contract Price falling due before the Delivery Date for the Ios Ship as set out
in schedule 3;

 

“Ios
Management Agreement” means the management agreement
made or (as the context may require) to be made between the Ios Borrower and
the Manager in a form previously approved in writing by the Bank providing (inter alia) for the Manager to manage the
Ios Ship;

 

“Ios
Manager’s Undertaking” means the first priority
undertaking and assignment in relation to the Ios Ship executed or (as the
context may require) to be executed by the Manager in favour of the Bank in
such form as the Bank may require in its sole discretion;

 

“Ios
Mortgage” means the first priority or (as the case may
be) preferred mortgage of the Ios Ship executed or (as the context may require)
to be executed by the Ios Borrower in favour of the Bank in such form as the
Bank may require in its sole discretion;

 

“Ios
Operating Account” means an interest bearing Dollar
account of the Ios Borrower opened or (as the context may require) to be opened
by the Ios Borrower with the Bank and includes any sub-accounts thereof and any
other account designated in writing by the Bank to be a Ios Operating Account
for the purposes of this Agreement;

 

“Ios
Pre-delivery Advances” means, together, the Ios First
Advance, the Ios Second Advance, the Ios Third Advance and the Ios Fourth
Advance and “Ios Pre-delivery Advance” means any of them;

 

“Ios
Pre-delivery Security Assignment” means the assignment
of the Ios Contract and the Ios Refund Guarantees executed or (as the context
may require) to be executed by the Ios Borrower in favour of the Bank in the
form set out in schedule 4;

 

11

 

“Ios
Refund Guarantee Assignment Consent and Acknowledgement” means, in relation to each Ios Refund
Guarantee, an acknowledgement of notice of, and consent to, the assignment in
respect of that Ios Refund Guarantee to be given
by a Refund Guarantor in the form scheduled to the Ios Pre-delivery Security
Assignment and “Ios Refund Guarantee Assignment Consents and Acknowledgements” means any or all
of them;

 

“Ios
Refund Guarantees” means, together, the letter of
guarantee no. LGD6600200700012 dated 8 June 2007 (as amended on 3 July 2007)
issued by Bank of Communications, Fuzhou Branch as Refund Guarantor in respect
of certain of the Builders obligations under the Ios Contract and any other
letters of guarantee to be issued by a Refund Guarantor in respect of the
Builder’s obligations under the Ios Contract, pursuant to the Ios Contract or
any agreement supplemental to the Ios Contract, and any extensions, renewals or
replacements to or of any such guarantee(s), in each case in form and substance
acceptable to the Bank in its sole discretion and “Ios Refund Guarantee”
means any of them;

 

“Ios
Second Advance” means
an Advance of up to $946,800 made or (as the context may require) to be made
available to the Borrowers for the purpose of financing in part the payment of
the second instalment of the Ios Contract Price falling due before the Delivery
Date for the Ios Ship as set out in schedule 3;

 

“Ios
Ship” means the 3,800 dwt (approximately) double-hull
oil product tanker currently known as Hull No. DN-3500-13, to be constructed
and sold by the Builder to the Ios Borrower pursuant to the Ios Contract and to
be registered on the Delivery Date for such Ship in the ownership of the Ios
Borrower through the relevant Registry under the laws and flag of the relevant
Flag State;

 

“Ios
Third  Advance” means an Advance of up to $946,800
made or (as the context may require) to be made available to the Borrowers for
the purpose of financing in part the payment of the third instalment of the Ios
Contract Price falling due before the Delivery Date for the Ios Ship as set out
in schedule 3;

 

“Ios
Tranche” means a tranche of the Loan of up to
$7,512,000 to be drawn down in not more than five (5) Advances (being the Ios
Advances);

 

“ISPS Code”
means the International Ship and Port facility Security Code constituted
pursuant to resolution A.924(22) of the International Maritime Organization now
set out in Chapter XI-2 of the International Convention for the Safety of Life
at Sea 1974 (as amended) as adopted by a Diplomatic conference of the
International Maritime Organisation on Maritime Security in December 2002 and
includes any amendments or extensions thereto and any regulation issued
pursuant thereto;

 

“ISSC”
means an International Ship Security Certificate issued in respect of a Ship
pursuant to the ISPS Code;

 

“LIBOR”
means, in relation to a particular period, the rate determined by the Bank to
be that at which deposits in Dollars and in an amount comparable with the
amount in relation to which LIBOR is to be determined and for a period equal to
the relevant period were being offered by the Bank to prime banks in the London
Interbank Market at or about 11:00 a.m. on the second Banking Day before the
first day of such period, provided that if the Borrowers shall at any time
enter into any Transaction(s) under the Master Swap Agreement, LIBOR shall
(during the period when any such Transaction(s) are effective and for an amount
equal to the notional amount of such Transaction(s)) be the rate for deposits
in Dollars for a period equivalent to such period at or about 11:00 a.m. on the
second Banking Day before the first day of such period as displayed on Reuters
page LIBOR 01 (British Bankers’ Association Interest Settlement Rates) (or such
other page as may replace such page LIBOR 01 on such system or on any other
system of the information vendor for the time being designated by the British
Bankers’ Association to calculate the BBA Interest Settlement Rate (as defined
in the British Bankers’ 

 

12

 

Association’s
Recommended Terms and Conditions (“BBAIRS” terms)
dated August 1996) for Dollars);

 

“Loan”
means the aggregate principal amount owing to the Bank under this Agreement at
any relevant time;

 

“Management
Agreement” means:

 

(a)                        in relation to the Andros Ship,
the Andros Management Agreement;

 

(b)                       in relation to the Dilos Ship,
the Dilos Management Agreement;

 

(c)                        in relation to the Ios Ship, the
Ios Management Agreement;

 

(d)                       in relation to the Sifnos Ship,
the Sifnos Management Agreement; or

 

(e)                        in relation to the Tinos Ship,
the Tinos Management Agreement,

 

and “Management Agreements” means any or all of them;

 

“Manager”
means, in relation to each Ship, Aegean Bunkering Services Inc. of Trust
Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands
MH96960 or any other person appointed by the relevant Borrower, with the prior
written consent of the Bank, as the manager of such Ship and, in each such
case, includes its successors in title;

 

“Manager’s
Undertaking” means:

 

(a)                        in relation to the Andros Ship,
the Andros Manager’s Undertaking;

 

(b)                       in relation to the Dilos Ship,
the Dilos Manager’s Undertaking;

 

(c)                        in relation to the Ios Ship, the
Ios Manager’s Undertaking;

 

(d)                       in relation to the Sifnos Ship,
the Sifnos Manager’s Undertaking; or

 

(e)                        in relation to the Tinos Ship,
the Tinos Manager’s Undertaking;

 

and “Manager’s Undertakings”
means any or all of them;

 

“Margin”
means:

 

(a)                        subject to paragraph (b) below,
zero point nine per cent (0.9%) per annum; and

 

(b)                       in relation to each Tranche,
from the Drawdown Date of the Delivery Advance of such Tranche zero point eight
five per cent (0.85%) per annum;

 

“Master
Agreement Security Deed” means the security deed
executed or (as the context may require) to be executed by the Borrowers in
favour of the Bank in the form set out in schedule 7;

 

“Master
Swap Agreement” means the agreement made between the
Bank and the Borrowers dated as of 5 July 2007 comprising an ISDA Master
Agreement, a schedule thereto (each in the form set out in schedule 6 and any
Confirmations (as defined therein) supplemental thereto;

 

“month”
means a period beginning in one calendar month and ending in the next calendar
month on the day numerically corresponding to the day of the calendar month on
which it started, provided that (i) if the period started on the last Banking
Day in a calendar month or if 

 

13

 

there is no
such numerically corresponding day, it shall end on the last Banking Day in
such next calendar month and (ii) if such numerically corresponding day is not
a Banking Day, the period shall end on the next following Banking Day in the
same calendar month but if there is no such Banking Day it shall end on the
preceding Banking Day and “months” and “monthly” shall be construed accordingly;

 

“Mortgage”
means:

 

(a)                        in relation to the Andros Ship,
the Andros Mortgage;

 

(b)                       in relation to the Dilos Ship,
the Dilos Mortgage;

 

(c)                        in relation to the Ios Ship, the
Ios Mortgage;

 

(d)                       in relation to the Sifnos Ship,
the Sifnos Mortgage; or

 

(e)                        in relation to the Tinos Ship,
the Tinos Mortgage,

 

and “Mortgages” means any or all of them;

 

“Mortgaged
Ship” means, at any relevant time, any Ship which is
at such time subject to a Mortgage and/or the Earnings, Insurances and
Requisition Compensation of which are subject to an Encumbrance pursuant to the
relevant Ship Security Documents and a Ship shall, for the purposes of this
Agreement, be deemed to be a Mortgaged Ship as from whichever shall be the
earlier of (a) the Drawdown Date of the Delivery Advance for that Ship and (b)
the date that the Mortgage of that Ship shall have been executed and registered
in accordance with this Agreement until whichever shall be the earlier of (i)
the payment in full of the amount required to be paid by the Bank pursuant to
clause 4.3 following the Total Loss of such Ship and (ii) the date on which all
moneys owing under the Security Documents have been repaid in full;

 

“Operating
Account” means:

 

(a)                        in relation to the Andros Ship,
the Andros Operating Account;

 

(b)                       in relation to the Dilos Ship,
the Dilos Operating Account;

 

(c)                        in relation to the Ios Ship, the
Ios Operating Account;

 

(d)                       in relation to the Sifnos Ship,
the Sifnos Operating Account; or

 

(e)                        in relation to the Tinos Ship,
the Tinos Operating Account,

 

and “Operating Accounts” means any or all of them;

 

“Operator”
means any person who is from time to time during the Security Period concerned
in the operation of a Ship and falls within the definition of “Company” set out in rule 1.1.2 of the
Code;

 

“Permitted
Encumbrance” means any Encumbrance in favour of the
Bank created pursuant to the Security Documents, the First Mortgage Documents
and Permitted Liens;

 

“Permitted
Liens” means, in relation to each Ship, any lien on
that Ship for masters, officers or crew’s wages outstanding in the ordinary
course of trading, any lien for salvage and any ship repairer’s or outfitter’s
possessory lien for a sum not (except with the prior written consent of the
Bank) exceeding the relevant Casualty Amount;

 

14

 

“Pollutant”
means and includes pollutants, contaminants, toxic substances, oil as defined
in the United States Oil Pollution Act of 1990 and all hazardous substances as
defined in the United States Comprehensive Environmental Response, Compensation
and Liability Act 1980;

 

“Pre-delivery
Advances”:

 

(a)                        in relation to the Andros Ship
and the Andros Tranche, means the Andros Pre-delivery Advances;

 

(b)                       in relation to the Dilos Ship
and the Dilos Tranche, means the Dilos Pre-delivery Advances;

 

(c)                        in relation to the Ios Ship and
the Ios Tranche, means the Ios Pre-delivery Advances;

 

(d)                       in relation to the Sifnos Ship
and the Sifnos Tranche, means the Sifnos Pre-delivery Advances; or

 

(e)                        in relation to the Tinos Ship
and the Tinos Tranche, means the Tinos Pre-delivery Advances,

 

and “Pre-delivery Advance” means any of them;

 

“Pre-delivery
Security Assignment” means:

 

(a)                        in relation to the Andros Ship,
the Andros Pre-delivery Security Assignment;

 

(b)                       in relation to the Dilos Ship,
the Dilos Pre-delivery Security Assignment;

 

(c)                        in relation to the Ios Ship, the
Ios Pre-delivery Security Assignment

 

(d)                       in relation to the Sifnos Ship,
the Sifnos Pre-delivery Security Assignment; or

 

(e)                        in relation to the Tinos Ship,
the Tinos Pre-delivery Security Assignment,

 

and “Pre-delivery Security Assignments” means any or all of
them;

 

“Refund
Guarantee” means:

 

(a)                        in relation to the Andros Ship,
any Andros Refund Guarantee;

 

(b)                       in relation to the Dilos Ship,
any Dilos Refund Guarantee;

 

(c)                        in relation to the Ios Ship, any
Ios Refund Guarantee;

 

(d)                       in relation to the Sifnos Ship,
any Sifnos Refund Guarantee; or

 

(e)                        in relation to the Tinos Ship,
any Tinos Refund Guarantee,

 

and “Refund Guarantees” means any or all of them;

 

“Refund
Guarantee Assignment Consent and Acknowledgement”
means:

 

(a)                        in relation to the Andros Ship,
any Andros Refund Guarantee Assignment Consent and Acknowledgement;

 

15

 

(b)                       in relation to the Dilos Ship,
any Dilos Refund Guarantee Assignment Consent and Acknowledgement;

 

(c)                        in relation to the Ios Ship, any
Ios Refund Guarantee Assignment Consent and Acknowledgement;

 

(d)                       in relation to the Sifnos Ship,
any Sifnos Refund Guarantee Assignment Consent and Acknowledgement; or

 

(e)                        in relation to the Tinos Ship,
any Tinos Refund Guarantee Assignment Consent and Acknowledgement,

 

and “Refund Guarantee Assignment Consents and Acknowledgements” means any or all of them;

 

“Refund
Guarantor” means Bank of Communications, Fuzhou Branch
of Fuzhou, People’s Republic of China and/or any other bank or financial
institution acceptable to the Bank in its sole discretion and appointed by the
Builder to issue a Refund Guarantee and includes their respective successors in
title and “Refund Guarantors” means any or all of them;

 

“Registry”
means, in relation to a Ship, any registrar, consul, commissioner or
representative of the relevant Flag State who is duly authorised and empowered
to register such Ship, the relevant Borrowers title to such Ship and the
relevant Mortgage under the laws and flag of the relevant Flag State;

 

“Regulatory
Agency” means the Government Entity or other organisation in a Flag State which
has been designated by the Government of that Flag State to implement and/or
administer and/or enforce the provisions of the Code;

 

“Related
Company” means:

 

(a)                        of the Bank, means any
Subsidiary of the Bank, any company or other entity of which the Bank is a
Subsidiary and any Subsidiary of any such company or entity; or

 

(b)                       of a Security Party, means any
company or other entity which is active in the bunkering business or services
and which is:

 

(i)                           a Subsidiary of the relevant
Security Party; or

 

(ii)                        any company or other entity (“holding company”) of which such Security
Party is a Subsidiary; or

 

(iii)                     any Subsidiary (other than such
Security Party) of any such holding company;

 

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

 

“Relevant
Party” means the Borrowers, the Borrowers’ Related
Companies, the other Security Parties (other than the Builder and the Refund
Guarantors) and their respective Related Companies;

 

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

 

16

 

“Repayment
Dates” means,
in relation to each Tranche (and subject to clause 6.3), the First Repayment
Date in respect such Tranche and each of the dates falling at three (3) monthly
intervals after such First Repayment Date up to and including the date falling
one hundred and seventeen (117) months after such First Repayment Date;

 

“Requisition
Compensation” means,
in relation to a Ship, all sums of money or other compensation from time to
time payable during the Security Period by reason of the Compulsory Acquisition
of such Ship;

 

“Second
Advance”:

 

(a)                        in relation to the Andros Ship
and the Andros Tranche, means the Andros Second Advance;

 

(b)                       in relation to the Dilos Ship
and the Dilos Tranche, means the Dilos Second Advance;

 

(c)                        in relation to the Ios Ship and
the Ios Tranche, means the Ios Second Advance;

 

(d)                       in relation to the Sifnos Ship
and the Sifnos Tranche, means the Sifnos Second Advance; or

 

(e)                        in relation to the Tinos Ship
and the Tinos Tranche, means the Tinos Second Advance,

 

and “Second Advances” means any or all of them;

 

“Security
Documents” means this Agreement, the Master Swap
Agreement, the Master Agreement Security Deed, the Corporate Guarantee, the
Mortgages, the Deeds of Covenant, the Pre-delivery Security Assignments, the
Contract Assignment Consents and Acknowledgements, the Refund Guarantee
Assignment Consents and Acknowledgements, the Managers Undertakings and any
other agreement or document as may have been or shall from time to time after
the date of this Agreement be executed to guarantee and/or secure all or any
part of the Loan, interest thereon and other moneys from time to time owing by
the Borrowers or any of them or any other Security Party pursuant to this
Agreement and/or the Master Swap Agreement or any other Security Document
(whether or not any such document also secures moneys from time to time owing
pursuant to any other document or agreement);

 

“Security
Party” means
each Borrower, the Corporate Guarantor, the Manager, each Refund Guarantor and
the Builder or any other person who may at any time be a party to any of the
Security Documents (other than the Bank);

 

“Security
Period” means the period commencing on the date hereof
and terminating upon discharge of the security created by the Security
Documents by payment of all monies payable thereunder,

 

“Security
Requirement” means
the amount in Dollars (as certified by the Bank whose certificate shall, in the
absence of manifest error, be conclusive and binding on the Borrowers and the
Bank) which is, at any relevant time, One hundred and twenty per cent (120%) of
the aggregate of (a) the Loan and (b) the cost (if any) (as certified by the
Bank whose certificate shall in the absence of manifest error be conclusive and
binding on the Borrowers and the Bank) of terminating any Transactions entered
into pursuant to the Master Swap Agreement;

 

“Security
Value” means the amount in Dollars (as certified by
the Bank whose certificate shall, in the absence of manifest error, be
conclusive and binding on the Borrowers and the Bank) which is, at any relevant
time, the aggregate of (i) the market value of the Mortgaged Ships as most
recently determined in accordance with clause 8.2.2 and (ii) the market value
of any additional security for the time being actually provided to the Bank
pursuant to clause 8.2;

 

17

 

“Ships”
means, together, the Andros Ship, the Dilos Ship, the Ios Ship, the Sifnos Ship
and the Tinos Ship and

 

(a)                        in relation to the Andros
Borrower and/or the Andros Tranche (or any Advance thereof), means the Andros
Ship;

 

(b)                       in relation to the Dilos
Borrower and/or the Dilos Tranche (or any Advance thereof), means the Dilos
Ship;

 

(c)                        in relation to the Ios Borrower
and/or the Ios Tranche (or any Advance thereof), means the Ios Ship;

 

(d)                       in relation to the Sifnos
Borrower and/or the Sifnos Tranche (or any Advance thereof), means the Sifnos
Ship;

 

(e)                        in relation to the Tinos
Borrower and/or the Tinos Tranche (or any Advance thereof), means the Tinos
Ship,

 

and “Ship” means any of them;

 

“Ship
Security Documents”:

 

(a)                        in relation to the Andros Ship,
means the Andros Mortgage, the Andros Deed of Covenant and the Andros Managers
Undertaking;

 

(b)                       in relation to the Dilos Ship,
means the Dilos Mortgage, the Dilos Deed of Covenant and the Dilos Manager’s
Undertaking;

 

(c)                        in relation to the Ios Ship, means
the Ios Mortgage, the Ios Deed of Covenant and the Ios Manager’s Undertaking;

 

(d)                       in relation to the Sifnos Ship,
means the Sifnos Mortgage, the Sifnos Deed of Covenant and the Sifnos Manager’s
Undertaking; or

 

(e)                        in relation to the Tinos Ship,
means the Tinos Mortgage, the Tinos Deed of Covenant and the Tinos Manager’s
Undertaking;

 

“Sifnos
Advances” means, together, the Sifnos Pre-delivery
Advances and the Sifnos Delivery Advance and “Sifnos
Advance” means any of them;

 

“Sifnos
Borrower” means Sifnos Marine Inc. of 80 Broad Street,
Monrovia, Republic of Liberia and includes its successors in title;

 

“Sifnos
Contract” means the shipbuilding contract dated 25 May
2007, made between the Builder and the Sifnos Borrower, as may be further
amended, supplemented, varied, replaced or novated from time to time with the
prior written consent of the Bank, relating to the construction and sale by the
Builder, and the purchase by the Sifnos Borrower, of the Sifnos Ship;

 

“Sifnos
Contract Assignment Consent and Acknowledgement” means the acknowledgement of notice
of, and consent to, the assignment in respect of the Sifnos Contract to be
given by the Builder in the form scheduled to the Sifnos Pre-delivery Security
Assignment;

 

“Sifnos
Contract Price” means Seven million eight hundred and
ninety thousand Dollars ($7,890,000) or such other lesser sum in Dollars as may
be payable by the Sifnos Borrower to 

 

18

 

the Builder
pursuant to the Sifnos Contract, as the purchase price for the Sifnos Ship
thereunder;

 

“Sifnos
Deed of Covenant” means the first priority deed of covenant and/or general
assignment collateral to the Sifnos Mortgage executed or (as the context may
require) to be executed by the Sifnos Borrower in favour of the Bank in such
form as the Bank may require in its sole discretion;

 

“Sifnos
Delivery Advance” means an Advance of up to $4,040,400 made or (as the context may
require) to be made available to the Borrowers for the purpose (a) financing in
part the final instalment of the Sifnos Contract Price falling due on the
Delivery Date for the Sifnos Ship and (b) (as to the balance) financing the
payment of any other part of the Total Construction Cost for the Sifnos Ship
previously paid by the Sifnos Borrower and not financed by this Agreement;

 

“Sifnos
First Advance” means an advance of up to $631,200
made or (as the context may require) to be made available to the Borrowers for
the purpose of financing or refinancing in part the payment of the first
instalment of the Sifnos Contract Price falling due before the Delivery Date of
the Sifnos Ship as set out in schedule 3;

 

“Sifnos
Fourth Advance” means an Advance of up to $946,800
made or (as the context may require) to be made available to the Borrowers for
the purpose of financing or refinancing in part the payment of the fourth
instalment of the Sifnos Contract Price falling due before the Delivery Date
for the Sifnos Ship as set out in schedule 3;

 

“Sifnos
Management Agreement” means the management agreement made
or (as the context may require) to be made between the Sifnos Borrower and the
Manager in a form previously approved in writing by the Bank providing (inter alia) for the Manager to manage the
Sifnos Ship;

 

“Sifnos
Managers Undertaking” means the first priority
undertaking and assignment in relation to the Sifnos Ship executed or (as the
context may require) to be executed by the Manager in favour of the Bank in
such form as the Bank may require in its sole discretion;

 

“Sifnos
Mortgage” means the first priority or (as the case may
be) preferred mortgage of the Sifnos Ship executed or (as the context may
require) to be executed by the Sifnos Borrower in favour of the Bank in such
form as the Bank may require in its sole discretion;

 

“Sifnos
Operating Account” means
an interest bearing Dollar account of the Sifnos Borrower opened or (as the
context may require) to be opened by the Sifnos Borrower with the Bank and
includes any sub-accounts thereof and any other account designated in writing
by the Bank to be a Sifnos Operating Account for the purposes of this
Agreement;

 

“Sifnos
Pre-delivery Advances” means, together, the Sifnos First Advance, the Sifnos Second
Advance, the Sifnos Third Advance and the Sifnos Fourth Advance and “Sifnos Pre-delivery Advance” means any of them;

 

“Sifnos
Pre-delivery
Security Assignment” means
the assignment of the Sifnos Contract and the Sifnos Refund Guarantees executed
or (as the context may require) to be executed by the Sifnos Borrower in favour
of the Bank in the form set out in schedule 4;

 

“Sifnos
Refund Guarantee Assignment Consent and Acknowledgement” means, in relation to each Sifnos
Refund Guarantee, an acknowledgement of notice of, and consent to, the
assignment in respect of that Sifnos Refund Guarantee to be given by a Refund
Guarantor in the form scheduled to the Sifnos Pre-delivery Security Assignment
and “Sifnos Refund Guarantee Assignment
Consents and Acknowledgements” means any or all of them;

 

19

 

“Sifnos
Refund Guarantees”
mean, together, the letter of guarantee no. LGD6600200700011 dated 8 June 2007
(as amended on 3 July 2007) issued by Bank of Communications, Fuzhou Branch as
Refund Guarantor in respect of certain of the Builders obligations under the
Sifnos Contract and any other letters of guarantee to be issued by a Refund
Guarantor in respect of the Builders obligations under the Sifnos Contract,
pursuant to the Sifnos Contract or any agreement supplemental to the Sifnos
Contract, and any extensions, renewals or replacements to or of any such
guarantee(s), in each case in form and substance acceptable to the Bank in its
sole discretion and “Sifnos Refund Guarantee”
means any of them;

 

“Sifnos
Second Advance” means an Advance of up to $946,800 made or (as the context may require)
to be made available to the Borrowers for the purpose of financing or
refinancing in part the payment of the second instalment of the Sifnos Contract
Price falling due before the Delivery Date for the Sifnos Ship as set out in
schedule 3;

 

“Sifnos
Ship” means
the 3,800 dwt (approximately) double-hull oil product tanker currently known as
Hull No. DN-3500-14, to be constructed and sold by the Builder to the Sifnos
Borrower pursuant to the Sifnos Contract and to be registered on the Delivery
Date for such Ship in the ownership of the Sifnos Borrower through the relevant
Registry under the laws and flag of the relevant Flag State;

 

“Sifnos
Third Advance” means an Advance of up to $946,800 made
or (as the context may require) to be made available to the Borrowers for the
purpose of financing or refinancing in full the payment of the third instalment
of the Sifnos Contract Price falling due before the Delivery Date for the
Sifnos Ship as set out in schedule 3;

 

“Sifnos
Tranche” means a tranche of the Loan of up to
$7,512,000 to be drawn down in not more than five (5) Advances (being the
Sifnos Advances);

 

“SMC”
means a safety management certificate issued in respect of a Ship in accordance
with rule 13 of the Code;

 

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

 

“Taxes”
includes all present and future taxes, levies, imposts, duties, fees or charges
of whatever nature together with interest thereon and penalties in respect thereof
and “Taxation” shall be construed
accordingly;

 

“Termination
Date” means:

 

(a)                        in relation to each Andros
Advance, 31 March 2009;

 

(b)                       in relation to each Dilos
Advance, 31 May 2009;

 

(c)                        in relation to each Ios Advance,
30 June 2009;

 

(d)                       in relation to each Sifnos
Advance, 31 July 2009; or

 

(e)                        in relation to each Tinos
Advance, 31 August 2009;

 

or, in each
such case, such later date as the Borrowers may request and the Bank may in its
absolute discretion consent to;

 

20

 

“Third
Advance”:

 

(a)                        in relation to the Andros Ship
and the Andros Tranche, means the Andros Third Advance;

 

(b)                       in relation to the Dilos Ship
and the Dilos Tranche, means the Dilos Third Advance;

 

(c)                        in relation to the Ios Ship and
the Ios Tranche, means the Ios Third Advance;

 

(d)                       in relation to the Sifnos Ship
and the Sifnos Tranche, means the Sifnos Third Advance; or

 

(e)                        in relation to the Tinos Ship
and the Tinos Tranche, means the Tinos Third Advance,

 

and “Third Advances” means any or all of them;

 

“Tinos
Advances” means,
together, the Tinos Pre-delivery Advances and the Tinos Delivery Advance and “Tinos
Advance” means any of them;

 

“Tinos
Borrower” means Tinos Marine Inc. of 80 Broad Street,
Monrovia, Republic of Liberia and includes its successors in title;

 

“Tinos
Contract” means the shipbuilding contract dated 25 May
2007, made between the Builder and the Tinos Borrower, as may be further
amended, supplemented, varied, replaced or novated from time to time with the
prior written consent of the Bank, relating to the construction and sale by the
Builder, and the purchase by the Tinos Borrower, of the Tinos Ship;

 

“Tinos
Contract Assignment Consent and
Acknowledgement” means the acknowledgement of notice of, and consent
to, the assignment in respect of the Tinos Contract to be given by the Builder
in the form scheduled to the Tinos Pre-delivery Security Assignment;

 

“Tinos
Contract Price” means Seven million eight hundred and
ninety thousand Dollars ($7,890,000) or such other lesser sum in Dollars as may
be payable by the Tinos Borrower to the Builder pursuant to the Tinos Contract,
as the purchase price for the Tinos Ship thereunder;

 

“Tinos
Deed of Covenant” means the first priority deed of
covenant and/or general assignment collateral to the Tinos Mortgage executed or
(as the context may require) to be executed by the Tinos Borrower in favour of
the Bank in such form as the Bank may require in its sole discretion;

 

“Tinos
Delivery Advance” means an Advance of up to $4,040,400
made or (as the context may require) to be made available to the Borrowers for
the purpose of (a) financing in part the final instalment of the Tinos Contract
Price falling due on the Delivery Date for the Tinos Ship and (b) (as to the
balance) financing the payment of any other part of the Total Construction Cost
for the Tinos Ship previously paid by the Tinos Borrower and not financed by
this Agreement;

 

“Tinos
First Advance” means an Advance of up to $631,200 made
or (as the context may require) to be made available to the Borrowers for the
purpose of financing or refinancing in part the payment of the second
instalment of the Tinos Contract Price falling due before the Delivery Date for
the Tinos Ship as set out in schedule 3;

 

“Tinos
Fourth Advance” means an Advance of up to $946,800 made or (as the context may require)
to be made available to the Borrowers for the purpose of financing in part the
payment of the fourth instalment of the Tinos Contract Price falling due before
the Delivery Date for the Tinos Ship as set out in schedule 3;

 

“Tinos
Management Agreement” means the management agreement made or (as the context may
require) to be made between the Tinos Borrower and the Manager in a form
previously approved in writing by the Bank providing (inter alia) for the Manager to manage the Tinos Ship;

 

21

 

“Tinos
Manager’s Undertaking” means the first priority undertaking and assignment in relation
to the Tinos Ship executed or (as the context may require) to be executed by
the Manager in favour of the Bank in such form as the Bank may require in its
sole discretion;

 

“Tinos
Mortgage” means
the first priority or (as the case may be) preferred mortgage of the Tinos Ship
executed or (as the context may require) to be executed by the Tinos Borrower
in favour of the Bank in such form as the Bank may require in its sole
discretion;

 

“Tinos
Operating Account” means
an interest bearing Dollar account of the Tinos Borrower opened or (as the
context may require) to be opened by the Tinos Borrower with the Bank and includes
any sub-accounts thereof and any other account designated in writing by the
Bank to be a Tinos Operating Account for the purposes of this Agreement;

 

“Tinos
Pre-delivery Advances”
means, together, the Tinos First Advance, the Tinos Second Advance, the Tinos
Third Advance and the Tinos Fourth Advance and “Tinos
Pre-delivery Advance” means any of them;

 

“Tinos
Pre-delivery Security Assignment” means the assignment
of the Tinos Contract and the Tinos Refund Guarantees executed or (as the
context may require) to be executed by the Tinos Borrower in favour of the Bank
in the form set out in schedule 4;

 

“Tinos
Refund Guarantee Assignment
Consent and Acknowledgement” means, in relation to each Tinos
Refund Guarantee, an acknowledgement of notice of, and consent to, the
assignment in respect of that Tinos Refund Guarantee to be given by a Refund
Guarantor in the form scheduled to the Tinos Pre-delivery Security Assignment
and “Tinos
Refund Guarantee Assignment Consents and Acknowledgements” means any
or all of them;

 

“Tinos
Refund Guarantees” means, together, the letter of
guarantee no. LGD6600200700015 dated 8 June 2007 (as amended on 3 July 2007)
issued by Bank of Communications, Fuzhou Branch as Refund Guarantor in respect
of certain of the Builders obligations under the Tinos Contract and any other
letters of guarantee to be issued by a Refund Guarantor in respect of the
Builders obligations under the Tinos Contract, pursuant to the Tinos Contract
or any agreement supplemental to the Tinos Contract, and any extensions,
renewals or replacements to or of any such guarantee(s), in each case in form
and substance acceptable to the Bank in its sole discretion and “Tinos Refund Guarantee” means any of them;

 

“Tinos
Second Advance” means an Advance of up to $946,800
made or (as the context may require) to be made available to the Borrowers for
the purpose of financing or refinancing in part the payment of the second
instalment of the Tinos Contract Price falling due before the Delivery Date for
the Tinos Ship as set out in schedule 3;

 

“Tinos
Ship” means
the 3,800 dwt (approximately) double-hull oil product tanker currently known as
Hull No. DN-3500-15, to be constructed and sold by the Builder to the Tinos
Borrower pursuant to the Tinos Contract and to be registered on the Delivery
Date for such Ship in the ownership of the Tinos Borrower through the relevant
Registry under the laws and flag of the relevant Flag State;

 

“Tinos
Third  Advance” means an Advance of up to $946,800
made or (as the context may require) to be made available to the Borrowers for
the purpose of financing or refinancing in part the payment of the third
instalment of the Tinos Contract Price falling due before the Delivery Date for
the Tinos Ship as set out in schedule 3;

 

“Tinos
Tranche” means a tranche of the Loan of up to
$7,512,000 to be drawn down in not more than five (5) Advances (being the Tinos
Advances);

 

“Total
Construction Cost” means, in relation to each Ship:

 

22

 

(a)                        the Contract Price for that
Ship; and

 

(b)                       additional expenditure in the
amount of up to $1,500,000 incurred or (as the context may require) to be
incurred by the Borrower owning that Ship in connection with the construction
and supervision of that Ship;

 

“Total
Loss” means, in relation to a Ship:

 

(a)                        actual, constructive,
compromised or arranged total loss of such Ship; or

 

(b)                       the Compulsory Acquisition of
such Ship; or

 

(c)                        the hijacking, theft,
condemnation, capture, seizure, arrest, detention or confiscation of such Ship
(other than where the same amounts to the Compulsory Acquisition of such Ship)
by any Government Entity, or by persons acting or purporting to act on behalf
of any Government Entity, unless such Ship be released and restored to the
relevant Borrower from such hijacking, theft, condemnation, capture, seizure,
arrest, detention or confiscation within thirty (30) days after the occurrence
thereof;

 

“Tranche”
means:

 

(a)                        in relation to the Andros Ship,
the Andros Tranche;

 

(b)                       in relation to the Dilos Ship,
the Dilos Tranche;

 

(c)                        in relation to the Ios Ship, the
Ios Tranche;

 

(d)                       in relation to the Sifnos Ship,
the Sifnos Tranche; or

 

(e)                        in relation to the Tinos Ship,
the Tinos Tranche,

 

and “Tranches” means any or all of them;

 

“Transaction”
means a Transaction as defined in the introductory paragraph of the Master Swap
Agreement;

 

“Transferee”
has the meaning ascribed thereto in clause 15.4; and

 

“Underlying
Documents” means, together, the Contracts, the Refund Guarantees
and the Management Agreements and “Underlying Document”
means any of them.

 

1.3                                         Headings

 

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

 

1.4                                         Construction of certain terms

 

In this
Agreement, unless the context otherwise requires:

 

1.4.1                                references to clauses and
schedules are to be construed as references to clauses of, and schedules to,
this Agreement and references to this Agreement include its schedules;

 

1.4.2                                references to (or to any
specified provision of) this Agreement or any other document shall be construed
as references to this Agreement that provision or that document as in force for
the 

 

23

 

time being and
as amended in accordance with terms thereof, or, as the case may be, with the
agreement of the relevant parties;

 

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

 

1.4.4                                words importing the plural shall
include the singular and vice versa;

 

1.4.5                                references to a time of day are
to London time;

 

1.4.6                                references to a person shall be
construed as references to an individual, firm, company, corporation,
unincorporated body of persons or any Government Entity

 

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

 

1.4.8                                references to any enactment
shall be deemed to include references to such enactment as reenacted, amended
or extended.

 

2.                                                The Commitment and the Loan

 

2.1                                         Agreement to
lend

 

The Bank,
relying upon each of the representations and warranties in clause 7, agrees to
lend to the Borrowers, jointly and severally, upon and subject to the terms of
this Agreement, the principal sum of up to Thirty seven million five hundred
and sixty thousand Dollars ($37,560,000) in twenty five (25) Advances
comprising five (5) Tranches, namely, the Andros Tranche, the Dilos Tranche,
the Ios Tranche, the Sifnos Tranche and the Tinos Tranche.

 

2.2                                         Drawdown

 

Subject to the
terms and conditions of this Agreement, each Advance shall be made following
receipt by the Bank from the Borrowers of a Drawdown Notice not later than
10:00 a.m. on the second Banking Day before the date, which shall be a Banking
Day falling within the relevant Drawdown Period, on which such Advance is
intended to be made. A Drawdown Notice shall be effective on actual receipt by
the Bank and, once given, shall, subject as provided in clause 3.6.1, be
irrevocable.

 

2.3                                         Timing and limitations of Loan,
Tranches and Advances

 

2.3.1                                The aggregate amount of the Loan
shall not exceed the lower of (a) Thirty seven million five hundred and sixty
thousand Dollars ($37,560,000) and (b) eighty per cent (80%) of the aggregate
Total Construction Cost of all the Ships.

 

2.3.2                                The aggregate amount of all the
Advances for a Ship shall not exceed the lower of (a) Seven million five
hundred and twelve thousand Dollars ($7,512,000) and (b) eighty per cent (80%)
of the Total Construction Cost of the relevant Ship.

 

2.3.3                                The amount of each Pre-delivery
Advance shall be:

 

(a)                        in the case of each First Advance,
not more than $631,200;

 

24

 

(b)                       in the case of each Second
Advance, not more than $946,800;

 

(c)                        in the case of each Third
Advance, not more than $946,800; and

 

(d)                       in the case of each Fourth
Advance, not more than $946,800.

 

2.3.4                                Each First Advance:

 

(a)                      shall be applied in or towards
payment to the Builder of part of the first instalment of the Contract Price
for the Ship relevant to such Advance;

 

(b)                     shall be made when the
instalment referred to in paragraph 2.3.4(a) above has become due and payable,
as specified in the third column of schedule 3 opposite the relevant First
Advance; and

 

(c)                      shall be paid by the Bank to the
Builder, unless the relevant Borrower has already paid such instalment to the
Builder when it was due, in which case the relevant First Advance shall be
advanced to the Borrowers.

 

2.3.5                                Each Second Advance:

 

(a)                      shall be applied in or towards
payment to the Builder of part of the second instalment of the Contract Price
for the Ship relevant to such Advance;

 

(b)                     shall be made
when the instalment referred to in paragraph 2.3.5(a) above has become due and
payable, as specified in the third column of schedule 3 opposite the relevant
Second Advance; and

 

(c)                      shall be paid by the Bank to the
Builder, unless the relevant Borrower has already paid such instalment to the
Builder when it was due, in which case the relevant Second Advance shall be
advanced to the Borrowers.

 

2.3.6                                Each Third Advance:

 

(a)                      shall be applied in or towards
payment to the Builder of part of the third instalment of the Contract Price
for the Ship relevant to such Advance;

 

(b)                     shall be made when the
instalment referred to in paragraph 2.3.6(a) above has become due and payable,
as specified in the third column of schedule 3 opposite the relevant Third
Advance; and

 

(c)                      shall be paid by the Bank to the
Builder, unless the relevant Borrower has already paid such instalment to the
Builder when it was due, in which case the relevant Third Advance shall be
advanced to the Borrowers.

 

2.3.7                                Each Fourth Advance:

 

(a)                      shall be applied in or towards
payment to the Builder of part of the fourth instalment of the Contract Price
for the Ship relevant to such Advance;

 

(b)                     shall be made when the
instalment referred to in paragraph 2.3.7(a) above has become due and payable,
as specified in the third column of schedule 3 opposite the relevant Fourth
Advance; and

 

25

 

(c)                      shall be paid by the Bank to the
Builder, unless the relevant Borrower has already paid such instalment to the
Builder when it was due, in which case the relevant Fourth Advance (or part
thereof) shall be advanced to the Borrowers.

 

2.3.8                                Each Delivery Advance:

 

(a)                      shall not exceed the lower of:

 

(i)                         Four million forty thousand and
four hundred Dollars ($4,040,400);

 

(ii)                      the amount in Dollars which,
when added to the aggregate amount of the Pre-delivery Advances for the
relevant Ship actually drawn down, will produce a figure equal to eighty per
cent (80%) of the Total Construction Cost of that Ship;

 

(iii)                   the amount in Dollars which,
when added to the aggregate amount of the Pre-delivery Advances for the
relevant Ship actually drawn down, will produce a figure equal to eighty per
cent (80%) of the market value of that Ship determined in accordance with the
valuation of such Ship obtained pursuant to schedule 2, Part 6, paragraph 19;
and

 

(iv)                  the amount in Dollars which,
when added to the aggregate amount of the Pre-delivery Advances for the
relevant Ship actually drawn down, will produce a total figure of $7,512,000;

 

(b)                     shall be applied (i) first, in
or towards payment to the Builder of the final instalment of the Contract Price
for the Ship relevant to such Advance and (ii) secondly, as to its balance, in
financing of any part of the Total Construction Cost of the relevant Ship
previously paid by the relevant Borrower when it was due and not financed by
this Agreement;

 

(c)                      shall be made when the
instalment referred to in paragraph 2.3.8(b)(i) above has become due and
payable; and

 

(d)                     (except for the part of the
relevant Delivery Advance referred to in paragraph 2.3.8(b)(ii) above, which
shall be paid directly to the Borrowers) shall be paid by the Bank to the
Builder, unless the relevant Borrower has already paid such instalment to the
Builder when it was due, in which case the relevant Delivery Advance (or part
thereof) shall be advanced to the Borrowers.

 

2.4                                         Availability

 

Upon receipt
of a Drawdown Notice complying with the terms of this Agreement the Bank shall,
subject to the provisions of clause 9, on the date specified in the Drawdown
Notice make the relevant Advance available to the Borrowers in accordance with
clause 6.2. The Borrowers acknowledge that payment of any Advance (or part
thereof) to the Builder in accordance with clause 6.2 shall satisfy the
obligation of the Bank to lend that Advance to the Borrowers under this
Agreement.

 

2.5                                         Termination of Commitment

 

Any part of
the Commitment undrawn and uncancelled by the relevant Termination Date, shall
thereupon be automatically cancelled.

 

2.6                                         Application of proceeds

 

Without
prejudice to the Borrowers’ obligations under clause 8.1.3, the Bank shall have
no responsibility for the application of proceeds of the Loan or any part
thereof by the Borrowers.

 

26

 

3.                                                Interest and Interest Periods

 

3.1                                         Normal interest rate

 

The Borrowers
shall pay interest on each Tranche in respect of each Interest Period relating
thereto on each Interest Payment Date (or, in the case of Interest Periods of
more than three (3) months, by instalments, the first three (3) months from the
commencement of the Interest Period and the subsequent instalments at intervals
of three (3) months or, if shorter, the period from the date of the preceding
instalment until the Interest Payment Date relative to such Interest Period) at
the rate per annum determined by the Bank to be the aggregate of (a) the
Margin, (b) the Additional Cost and (c) LIBOR for such Interest Period.

 

3.2                                         Selection of Interest Periods

 

The Borrowers
may by notice received by the Bank not later than 10:00 a.m. on the second
Banking Day before the beginning of each Interest Period, specify whether such
Interest Period shall have a duration of one (1) month, two (2) months, (3)
months, six (6) months or twelve (12) months or such other period as the
Borrowers may select and the Bank may, in its absolute discretion, agree
Provided always that if, on any date upon which an Interest Period falls to be
selected by the Borrowers pursuant to this clause 3.2, a Transaction or
Transactions (which is/are effective or which shall become effective during the
relevant Interest Period) shall have been entered into between the Bank and the
Borrowers pursuant to the Master Swap Agreement, LIBOR shall, during the period
of any such Transaction(s) and for an amount equal to the notional amount of
such Transaction(s), be determined by reference to the rate for deposits in
Dollars displayed on Reuters page LIBOR 01 (British Bankers’ Association Settlement
Rates) in accordance with the proviso to the definition of LIBOR in clause 12
and, for the avoidance of doubt, LIBOR for that part of the Loan which exceeds
the notional amount of the Transaction(s) shall be determined by reference to
the rate for deposits in Dollars referred to in the definition of LIBOR in
clause 1.2 but excluding the proviso to such definition.

 

3.3                                         Determination of Interest
Periods

 

Every Interest
Period shall be of the duration required by, or specified by the Borrowers
pursuant to, clause 3.2 but so that:

 

3.3.1                                  the initial Interest Period in
respect of each Advance shall commence on the Drawdown Date of such Advance and
each subsequent Interest Period in respect thereof shall commence on the last
day of the previous Interest Period for such Advance;

 

3.3.2                                  the initial Interest Period in
respect of each Advance in respect of a Ship (after the first Advance to be
drawn down in respect of such Ship) shall end on the same day as the then
current Interest Period for the Tranche for such Ship and, on the last day of
such Interest Period, all drawn Advances of such Tranche shall be consolidated
into, and shall thereafter constitute, the Tranche in respect of such Ship;

 

3.3.3                                  if any Interest Period in
respect of a Tranche would otherwise overrun a Repayment Date for such Tranche,
then, in the case of the last Repayment Date for such Tranche, such Interest
Period shall end on such Repayment Date, and in the case of any other Repayment
Date or Repayment Dates for such Tranche, the relevant Tranche shall be divided
into parts so that there is one part in the amount of the repayment instalment
or instalments due on each Repayment Date for such Tranche falling during that
Interest Period and having an Interest Period ending on the relevant Repayment
Date and another part in the amount of the balance of the relevant Tranche
having an Interest Period ascertained in accordance with clause 3.2 and the
other provisions of this clause 3.3; and

 

27

 

3.3.4                                  if the Borrowers fail to specify
the duration of an Interest Period in accordance with the provisions of clause
3.2 and this clause 3.3, such Interest Period shall have a duration of three
(3) months or such other period as shall comply with this clause 3.3.

 

3.4                                         Default interest

 

If the
Borrowers fail to pay any sum (including, without limitation, any sum payable
pursuant to this clause 3.4) on its due date for payment under any of the
Security Documents (other than the Master Swap Agreement), the Borrowers shall
pay interest on such sum on demand from the due date up to the date of actual
payment (as well after as before judgment) at a rate determined by the Bank
pursuant to this clause 3.4. The period beginning on such due date and ending
on such date of payment shall be divided into successive periods of not more
than six (6) months as selected by the Bank each of which (other than the
first, which shall commence on such due date) shall commence on the last day of
the preceding such period. The rate of interest applicable to each such period
shall be the aggregate (as determined by the Bank) of (a) one per cent (1%) per
annum, (b) the Margin, (c) the Additional Cost and (d) LIBOR for such period.
Such interest shall be due and payable on the last day of each such period as
determined by the Bank and each such day shall, for the purposes of this
Agreement, be treated as an Interest Payment Date, provided that, if such
unpaid sum is an amount of principal which became due and payable by reason of
a declaration by the Bank under clause 10.2.2 or a prepayment pursuant to
clauses 4.3, 8.2 or 12.1, on a date other than an Interest Payment Date
relating thereto, the first s t such period selected by the Bank shall be of a
duration equal to the period between the due date of such principal sum and
such Interest Payment Date and interest shall be payable on such principal sum
during such period at a rate one per cent (1%) above the rate applicable
thereto immediately before it shall have become so due and payable. If, for the
reasons specified in clause 3.6.1, the Bank is unable to determine a rate in
accordance with the foregoing provisions of this clause 3.4, interest on any
sum not paid on its due date for payment shall be calculated at a rate
determined by the Bank to be one per cent (1%) per annum above the aggregate of
the Margin and the cost of funds (including Additional Cost) to the Bank.

 

3.5                                         Notification of Interest Periods
and interest rate

 

The Bank shall
notify the Borrowers promptly of the duration of each Interest Period and of
each rate of interest determined by it under this clause 3.

 

3.6                                         Market disruption;
non-availability

 

3.6.1                                  If and whenever, at any time
prior to the commencement of any Interest Period, the Bank shall have
determined (which determination shall, in the absence of manifest error, be
conclusive):

 

(a)                        that adequate and fair means do
not exist for ascertaining LIBOR during such Interest Period; or

 

(b)                       that deposits in Dollars are not
available to the Bank in the London Interbank Market in the ordinary course of
business in sufficient amounts to fund the Loan for such Interest Period,

 

the Bank shall
forthwith give notice (a “Determination
Notice”) thereof to
the Borrowers. A Determination Notice shall contain particulars of the relevant
circumstances giving rise to its issue. After the giving of any Determination
Notice the undrawn amount of the Commitment shall not be borrowed until notice
to the contrary is given to the Borrowers by the Bank.

 

3.6.2                                 During
the period of ten (10) days after any Determination Notice has been given by
the Bank under clause 3.6.1, the Bank shall certify an alternative basis (the “Substitute Basis”) for maintaining the Loan. The
Substitute Basis may (without limitation) include alternative interest periods,
alternative currencies or alternative rates of interest but shall include a
margin above 

 

28

 

                                                         the
cost of funds, including Additional Cost, if any, to the Bank equivalent to the
Margin. Each Substitute Basis so certified shall be binding upon the Borrowers
and shall take effect in accordance with its terms from the date specified in
the Determination Notice until such time as the Bank notifies the Borrowers
that none of the circumstances specified in clause 3.6.1 continues to exist
whereupon the normal interest rate fixing provisions of this Agreement shall
apply.

 

4.                                                Repayment and prepayment

 

4.1                                         Repayment

 

The Borrowers
shall repay each Tranche by forty (40) instalments, one such instalment to be
repaid on each of the Repayment Dates for such Tranche. Subject to the
provisions of this Agreement, the amount of each of the repayment instalments
for each Tranche shall be One hundred and eighty seven thousand eight hundred
Dollars ($187,800). If the Commitment in respect of any Tranche or part thereof
is not drawn in full, the amount of the repayment instalments in respect of the
relevant Tranche shall be reduced proportionately.

 

4.2                                         Voluntary prepayment

 

The Borrowers
may prepay any Tranche in whole or part (being Two hundred thousand Dollars
($200,000) or any larger sum which is an integral multiple of Two hundred
thousand Dollars ($200,000)) on any Interest Payment Date relating to the part
of the Tranche to be prepaid, without premium or penalty.

 

4.3                                         Prepayment on Total Loss or
demand under Refund Guarantees

 

4.3.1                                Before first drawdown

 

On a Ship
becoming a Total Loss or suffering damage or being involved in an incident
which, in the opinion of the Bank, may result in such Ship being subsequently
determined to be a Total Loss, before any Advance for such Ship is drawn down,
the obligation of the Bank to advance the Tranche (or part thereof) for such
Ship shall immediately cease and the Commitment shall be reduced accordingly.

 

4.3.2                                After first drawdown but prior
to Delivery

 

(a)                        On a Ship becoming a Total Loss
or suffering damage or being involved in an incident which, in the opinion of
the Bank, may result in such Ship being subsequently determined to be a Total
Loss, after any Advance for such Ship has been drawn down but prior to the
drawing of the Delivery Advance for such Ship, the obligation of the Bank to
advance any other Advance (or part thereof) for such Ship shall immediately
cease, the Commitment shall be reduced accordingly and the Borrowers shall
prepay the Pre-delivery Advances for such Ship in full.

 

(b)                       If a claim is made under any
Refund Guarantee and such claim is not paid within twenty (20) Banking Days of
it being made (whether or not such claim has been referred to the appropriate
courts pursuant to the relevant Refund Guarantee), then (a) the obligation of
the Bank to advance any other Advance (or any part thereof) for the Ship
relevant to such Refund Guarantee shall immediately cease and (b) forthwith on
the expiry of such twenty (20) day period the Borrowers shall prepay in full
the then outstanding Advances in respect of that Ship Provided however that if the relevant claim made under the
Contract to which such Refund Guarantee relates has been referred to
arbitration under the terms of such Contract, the time-limit (and the
corresponding prepayment obligation of the Borrowers) referred to in paragraph
(b) of this clause shall be extended to ninety (90) days of the claim under the
relevant Refund Guarantee being made.

 

29

 

4.3.3                                Thereafter - Mortgaged Ships

 

On the date
falling one hundred and twenty (120) days after that on which a Mortgaged Ship
became a Total Loss or, if earlier, on the date upon which the insurance
proceeds in respect of such Total Loss are, or Requisition Compensation for
such Ship is, received by the relevant Borrower (or the Bank pursuant to the
Security Documents), the Borrowers shall prepay the Tranche for such Mortgaged
Ship in full.

 

4.3.4                                Interpretation

 

For the
purpose of this Agreement, a Total Loss in respect of a Ship shall be deemed to
have occurred:

 

(a)                        in the case of an actual total
loss of a Ship, on the actual date and at the time such Ship was lost or, if
such date is not known, on the date on which such Ship was last reported;

 

(b)                       in the case of a constructive
total loss of a Ship, upon the date and at the time notice of abandonment of
such Ship is given to the insurers of such Ship for the time being;

 

(c)                        in the case of a compromised or
arranged total loss of a Ship, on the date upon which a binding agreement as to
such compromised or arranged total loss has been entered into by the insurers of such
Ship;

 

(d)                       in the case of Compulsory
Acquisition of such Ship, on the date upon which the relevant requisition of
title or other compulsory acquisition occurs; and

 

(e)                        in the case of hijacking, theft,
condemnation, capture, seizure, arrest, detention or confiscation of a Ship
(other than where the same amounts to Compulsory Acquisition of such Ship) by
any Government Entity, or by persons purporting to act on behalf of any Government
Entity, which deprives the relevant Borrower of the use of such Ship for more
than thirty (30) days, upon the expiry of the period of thirty (30) days after
the date upon which the relevant hijacking, theft, condemnation, capture,
seizure, arrest, detention or confiscation occurred.

 

4.4                                         Amounts payable on prepayment

 

Any prepayment
of all or part of the Loan under this Agreement shall be made together with
(a) accrued interest on the amount to be prepaid to the date of such
prepayment, (b) any additional amount payable under clauses 6.6 or 12.2
and (c) all other sums payable by the Borrowers to the Bank under this
Agreement or any of the other Security Documents including, without limitation,
any accrued commitment commission payable under clause 5.1.2 and any amounts
payable under clause 11.

 

4.5                                         Notice of prepayment; reduction
of repayment instalments

 

4.5.1                                No prepayment may be effected
under clause 4.2 unless the Borrowers shall have given the Bank at least
fourteen (14) days’ notice of their intention to make such prepayment. Every
notice of prepayment shall be effective only on actual receipt by the Bank,
shall be irrevocable, shall specify the Tranche and the amount thereof to be
prepaid and shall oblige the Borrowers to make such prepayment on the date
specified.

 

4.5.2                                Any amount prepaid pursuant to
clause 4.2 in respect of a Tranche shall be applied in reducing the repayment
instalments of the relevant Tranche under clause 4.1 in inverse order of their
due dates for payment.

 

30

 

4.5.3                                Any amount prepaid pursuant to
clause 8.2.1(a) shall be applied in prepayment of all Tranches proportionately
as between them and in reduction of the repayment instalments of each Tranche
in inverse order of their due dates for payment.

 

4.5.4                                The Borrowers may not prepay the
Loan or any part thereof save as expressly provided in this Agreement. No
amount prepaid under this Agreement may be re-borrowed.

 

4.6                                         Master Swap Agreement,
repayments and prepayments

 

4.6.1                                Notwithstanding any provision of
the Master Swap Agreement to the contrary, in the case of a prepayment of all
or part of the Loan (including, without limitation, following the occurrence of
a Total Loss in accordance with clause 4.3 or under clauses 8.2.1(a) or 12.1)
then, subject to clause 4.6.2, the Bank shall be entitled but not obliged (and,
where relevant, may do so without the consent of the Borrowers, where it would
otherwise be required whether under the Master Swap Agreement or otherwise) to
amend, supplement, cancel, net out, terminate, liquidate, transfer or assign
all or any part of the rights, benefits and obligations created by any
Transaction and/or the Master Swap Agreement and/or to obtain or re-establish
any hedge or related trading position in any manner and with any person the
Bank in its absolute discretion may determine and both the Bank’s and the
Borrowers’ continuing obligations under any Transaction and/or the Master Swap
Agreement shall, unless agreed otherwise by the Bank, be calculated so far as
the Bank considers it practicable by reference to the amended repayment
schedule for the Loan taking into account the fact that less than the full
amount of the Loan remains outstanding.

 

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

 

4.6.3                                The Borrowers shall on the first
written demand of the Bank indemnify the Bank in respect of all losses, costs
and expenses (including, but not limited to, legal costs and expenses) incurred
or sustained by the Bank as a consequence of or in relation to the effecting of
any matter or transactions referred to in this clause 4.6.

 

4.6.4                                Notwithstanding any provision of
the Master Swap Agreement to the contrary, if for any reason a Transaction has
been entered into but no Advance is drawn down under this Agreement then,
subject to clause 4.6.5, the Bank shall be entitled but not obliged (and, where
relevant, may do so without the consent of the Borrowers where it would
otherwise be required whether under the Master Swap Agreement or otherwise) to
amend, supplement, cancel, net out, terminate, liquidate, transfer or assign
all or any part of the rights, benefits and obligations created by such
Transaction and/or the Master Swap Agreement and/or to obtain or re-establish
any hedge or related trading position in any manner and with any person the
Bank in its absolute discretion may determine.

 

4.6.5                                If a Transaction has been
entered into but no Advance is drawn down under this Agreement and the Bank in
its absolute discretion agrees, following a written request of the Borrowers,
that the Borrowers may be permitted to maintain all or part of a Transaction,
the Borrowers shall, within ten (10) days of being notified by the Bank of such
requirement, provide the Bank with, or procure the provision to the Bank of,
such additional security as shall in the opinion of the Bank be adequate to
secure the performance of such Transaction, which additional security shall
take such form, be constituted by such documentation and be entered into
between such parties, as 

 

31

 

the Bank in its
absolute discretion may approve or require, and each document comprising such
additional security shall constitute a Credit Support Document for the purposes
of the Master Swap Agreement and/or otherwise.

 

4.6.6                                Without prejudice to or
limitation of the obligations of the Borrowers under clause 4.6.3, in the event
that the Bank exercises any of its rights under clauses 4.6.1, 4.6.2, 4.6.4 or
4.6.5 and such exercise results in all or part of a Transaction being
terminated, such termination shall be treated under the Master Swap Agreement
in the same manner as if it were a Terminated Transaction (as defined in
section 14 of the Master Swap Agreement) effected by the Bank after an Event of
Default (as so defined in that section 14) by the Borrowers and, accordingly,
the Bank shall be permitted to recover from the Borrowers a payment for early
termination calculated in accordance with the provisions of section 6(e)(i) of
the Master Swap Agreement.

 

5.                                                Fees, commitment commission and
expenses

 

5.1                                         Fees

 

The Borrowers
shall pay to the Bank:

 

5.1.1                                on the date of this Agreement,
an arrangement fee of Ninety three thousand nine hundred Dollars ($93,900); and

 

5.1.2                                on each of the dates falling at
three (3) monthly intervals after the date of this Agreement until the earlier
of (i) the last day of the last Drawdown Period to elapse and (0) the Drawdown
Date of the last Delivery Advance to be drawn down, and on the earlier of such
two dates, commitment commission computed from the date of this Agreement (in
the case of the first payment of commission) and from the due date of the
preceding payment of commission (in the case of each subsequent payment) at the
rate of zero point two five per cent (0.25%) per annum on the daily undrawn
amount of the Commitment.

 

The fee
referred to in clause 5.1.1 and the commitment commission referred to in clause
5.1.2 shall be non-refundable and shall be payable by the Borrowers to the Bank
whether or not any part of the Commitment is ever advanced.

 

5.2                                         Expenses

 

The Borrowers
shall pay to the Bank on a full indemnity basis on demand all expenses
(including legal, printing and out-of-pocket expenses) incurred by the Bank:

 

5.2.1                                in connection with the
negotiation, preparation, execution and, where relevant, registration of the
Security Documents and of any amendment or extension of or the granting of any
waiver or consent under, any of the Security Documents; and

 

5.2.2                                in contemplation of, or
otherwise in connection with, the enforcement of, or preservation of any rights
under, any of the Security Documents, or otherwise in respect of the moneys
owing under any of the Security Documents, together with interest at the rate
referred to in clause 3.4 from the date on which such expenses were incurred to
the date of payment (as well after as before judgment).

 

5.3                                         Value Added Tax

 

All fees,
commitment commission and expenses payable pursuant to this clause 5 shall be
paid together with value added tax or any similar tax (if any) properly
chargeable thereon. My value added tax chargeable in respect of any services
supplied by the Bank under this Agreement shall, on delivery of the value added
tax invoice, be paid in addition to any sum agreed to be paid hereunder.

 

32

 

5.4                                         Stamp and other duties

 

The Borrowers
shall pay all stamp, documentary, registration or other like duties or taxes
imposed on or in connection with any of the Underlying Documents, the Security
Documents or the Loan and shall indemnify the Bank against any liability
arising by reason of any delay or omission by the Borrowers to pay such duties
or taxes.

 

6.                                                Payments and taxes; accounts and
calculations

 

6.1                                         No set-off or counterclaim

 

The Borrowers
acknowledge that in performing its obligations under this Agreement, the Bank
will be incurring liabilities to third parties in relation to the funding of
amounts to the Borrowers, such liabilities matching the liabilities of the
Borrowers to the Bank and that it is reasonable for the Bank to be entitled to
receive payments from the Borrowers gross on the due date in order that the
Bank is put in a position to perform its matching obligations to the relevant
third parties. Accordingly, subject to paragraph (i) of Part 5 of the Schedule
to the Master Swap Agreement, all payments to be made by the Borrowers
under any of the Security Documents shall be made in full, without any set-off
or counterclaim whatsoever and, subject as provided in clause 6.6, free and
clear of any deductions or withholdings, in Dollars (except for charges or
expenses which shall be paid in the currency in which they are incurred) on the
due date (for value on the day on which payment is due) to the account of the
Bank at American Express Bank Limited, 23° Floor, American Express Tower, 200
Vesey Street, New York, NY 10285-2300, USA, Account Number 000261123 (with a
direct tested telex advice to the Bank) or to such other account of the Bank at
such bank and in such place as the Bank may from time to time specify for this
purpose.

 

6.2                                         Payment by the Bank

 

All sums to be
advanced by the Bank to the Borrowers under this Agreement in respect of the
Loan shall be remitted in Dollars on the Drawdown Date for the relevant Advance
to the account specified in the Drawdown Notice for such Advance.

 

6.3                                         Non-Banking Days

 

When any
payment under any of the Security Documents would otherwise be due on a day
which is not a Banking Day, the due date for payment shall be extended to the
next following Banking Day unless such Banking Day falls in the next calendar
month in which case payment shall be made on the immediately preceding Banking
Day.

 

6.4                                         Calculations

 

All interest
and other payments of an annual nature under any of the Security Documents
shall accrue from day to day and be calculated on the basis of actual days
elapsed and a three hundred and sixty (360) day year.

 

6.5                                         Certificates conclusive

 

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

 

6.6                                         Grossing-up for Taxes

 

If at any time
the Borrowers are required to make any deduction or withholding in respect of
Taxes from any payment due under any of the Security Documents, the sum due
from the

 

33

 

Borrowers in
respect of such payment shall be increased to the extent necessary to ensure
that, after the making of such deduction or withholding, the Bank receives on
the due date for such payment (and retains, free from any liability in respect
of such deduction or withholding), a net sum equal to the sum which it would
have received had no such deduction or withholding been required to be made and
the Borrowers shall indemnify the Bank against any losses or costs incurred by
it by reason of any failure of the Borrowers to make any such deduction or
withholding or by reason of any increased payment not being made on the due
date for such payment. The Borrowers shall promptly deliver to the Bank any
receipts, certificates or other proof evidencing the amounts (if any) paid or
payable in respect of any deduction or withholding as aforesaid.

 

6.7                                         Loan account

 

The Bank shall
maintain, in accordance with its usual practice, an account or accounts
evidencing the amounts from time to time lent by, owing and paid to, it under
the Security Documents. Such account shall be the “account current” referred to
in any Mortgage which shall be in a statutory form. Such account shall, in the
absence of manifest error, be conclusive as to the amount from time to time
owing by the Borrowers under the Security Documents.

 

7.                                                Representations and warranties

 

7.1                                         Continuing representations and
warranties

 

The Borrowers
jointly and severally represent and warrant to the Bank that:

 

7.1.1                                Due incorporation

 

each of the
Borrowers and each of the other Security Parties are duly incorporated and
validly existing in good standing under the laws of their respective countries
of incorporation as Liberian corporations (in case of the Borrowers) or as
Marshall Islands corporations (in the case of the Corporate Guarantor and the
Manager) or as companies with limited liability (in the case of the other
Security Parties) and have power to carry on their respective businesses as
they are now being conducted and to own their respective property and other
assets;

 

7.1.2                                Corporate power

 

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

 

7.1.3                                Binding obligations

 

the Underlying
Documents and the Security Documents constitute or will, when executed,
constitute valid and legally binding obligations of the relevant Security
Parties enforceable in accordance with their respective terms;

 

7.1.4                                No conflict with other
obligations

 

the execution
and delivery of, the performance of their obligations under, and compliance
with the provisions of, the Underlying Documents and the Security Documents by
the relevant Security Parties will not (i) contravene any existing applicable
law, statute, rule or regulation or any judgment, decree or permit to which any
of the Borrowers or any other Security Party is

 

34

 

subject, (ii)
conflict with, or result in any breach of any of the terms of, or constitute a
default under, any agreement or other instrument to which any of the Borrowers
or any other Security Party is a party or is subject or by which it or any of
its property is bound, (iii) contravene or conflict with any provision of the
constitutional documents of any of the Borrowers or any other Security Party or
(iv) result in the creation or imposition of or oblige any of the Borrowers or
any other Security Party to create any Encumbrance (other than a Permitted
Encumbrance) on any of the undertakings, assets, rights or revenues of the
Borrowers or any other Security Party;

 

7.1.5                                No litigation

 

no litigation,
arbitration or administrative proceeding is taking place, pending or, to the knowledge of any of the officers
of the Borrowers, threatened against any of the Borrowers or any other Security
Party which could have a material adverse effect on the business, assets or
financial condition of any of the Borrowers or any of their Related Companies
or any other Security Party;

 

7.1.6                                No filings required

 

save for the
registration of the Mortgages through the Registry, it is not necessary to
ensure the legality, validity, enforceability or admissibility in evidence of
any of the Security Documents or any of the Underlying Documents that they or
any other instrument be notarised, filed, recorded, registered or enrolled in
any court, public office or elsewhere in any Relevant Jurisdiction or that any
stamp, registration or similar tax or charge be paid in any Relevant
Jurisdiction on or in relation to the Security Documents and the Underlying
Documents and each of the Security Documents and the Underlying Documents is in
proper form for its enforcement in the courts of each Relevant Jurisdiction;

 

7.1.7                                Choice of law

 

the choice of
English law to govern the Underlying Documents and the Security Documents
(other than the Mortgages), the choice of the law of the relevant Flag State to
govern each Mortgage, and the submissions by the Security Parties to the
non-exclusive jurisdiction of the English courts, are valid and binding;

 

7.1.8                                No immunity

 

none of the
Borrowers nor any other Security Party nor any of their respective assets is
entitled to immunity on the grounds of sovereignty or otherwise from any legal
action or proceeding (which shall include, without limitation, suit, attachment
prior to judgement, execution or other enforcement);

 

7.1.9                                Consents obtained

 

every consent,
authorisation, licence or approval of, or registration with or declaration to,
governmental or public bodies or authorities or courts required by any Security Party to
authorise, or required by any Security Party in connection with, the execution,
delivery, validity, enforceability or admissibility in evidence of each of the
Underlying Documents and the Security Documents or the performance by each
Security Party of its obligations under the Underlying Documents and the
Security Documents has been obtained or made and is in full force and effect
and there has been no default in the observance of any of the conditions or
restrictions (if any) imposed in, or in connection with, any of the same; and

 

7.1.10                          Shareholdings

 

each of the
Borrowers and the Manager are wholly-owned direct or indirect Subsidiaries of
the Corporate Guarantor and no less than 35% of the total issued and voting
share capital of the Corporate Guarantor is ultimately beneficially owned by Mr.
Dimitrios Melissanidis.

 

35

 

7.2             Initial representations and
warranties

 

The Borrowers
jointly and severally further represent and warrant to the Bank that:

 

7.2.1                                Pari passu

 

the
obligations of each Borrower under this Agreement and the Master Swap Agreement
are direct, general and unconditional obligations of such Borrower and rank at
least pari passu with all other present and future unsecured and unsubordinated
Indebtedness of such Borrower (with the exception of any obligations which are
mandatorily preferred by law and not by contract);

 

7.2.2                                No default under other
Indebtedness

 

none of the
Borrowers nor any of their respective Related Companies nor any other Security
Party is (nor would with the giving of notice or lapse of time or the
satisfaction of any other condition or combination thereof be) in breach of or
in default under the Master Swap Agreement or any other agreement relating to
Indebtedness to which it is a party or by which it may be bound;

 

7.2.3                                Information

 

the
information, exhibits and reports furnished by any Security Party to the Bank
in connection with the negotiation and preparation of the Security Documents
are true and accurate in all material respects and not misleading, do not omit
material facts and all reasonable enquiries have been made to verify the facts
and statements contained therein; there are no other fads the omission of which
would make any fact or statement therein misleading;

 

7.2.4                                No withholding Taxes

 

no Taxes are
imposed by withholding or otherwise on any payment to be made by any Security
Party under the Underlying Documents or the Security Documents or are imposed
on or by virtue of the execution or delivery by the Security Parties of the
Underlying Documents or the Security Documents or any other document or
instrument to be executed or delivered under any of the Security Documents;

 

7.2.5                                No Default

 

no Default has
occurred and is continuing;

 

7.2.6                                No Default under Contracts or
Refund Guarantees

 

no Borrower is
in default of any of its obligations under the relevant Contract or any of its
obligations upon the performance or observance of which depend the continued
liability of any Refund Guarantor in accordance with the terms of any Refund
Guarantee relating to such Ship;

 

7.2.7                                No Encumbrance in respect of
pre-delivery security

 

no Borrower
has previously charged, encumbered or assigned the benefit of any of its
rights, title and interest in or to the Contract or any Refund Guarantee
relating to such Borrower’s Ship and such benefit and all such rights, title
and interest are freely assignable and chargeable in the manner contemplated by
the Security Documents;

 

7.2.8                                The Ships

 

each Ship will
be on the Drawdown Date of the Delivery Advance relevant to such Ship:

 

36

 

(a)                        in the absolute ownership of the
relevant Borrower who will, on and after such date, be the sole, legal and
beneficial owner of such Ship;

 

(b)                       registered in the name of the
relevant Borrower through the relevant Registry as a ship under the laws and
flag of the relevant Flag State;

 

(c)                        operationally seaworthy and in
every way fit for service; and

 

(d)                       classed with the relevant
Classification free of all requirements and recommendations of the relevant
Classification Society;

 

7.2.9                                Ships’ employment

 

none of the
Ships is, nor will be, on the Drawdown Date of the relevant Delivery Advance,
subject to any charter or contract or to any agreement to enter into any
charter or contract which, if entered into after the date of the relevant Ship
Security Documents would have required the consent of the Bank and, on or
before the Drawdown Date of the Delivery Advance relevant to a Ship, there will
not be any agreement or arrangement whereby the Earnings of that Ship may be
shared with any other person;

 

7.2.10                          Freedom from Encumbrances

 

no Ship, nor
its Earnings, Insurances or Requisition Compensation nor its Operating Account
nor any other properties or rights which are, or are to be, the subject of any
of the Security Documents relating to that Ship nor any part thereof will be,
on the Drawdown Date of the Delivery Advance relevant to such Ship, subject to
any Encumbrance (other than Permitted Encumbrances);

 

7.2.11                          Compliance with Environmental
Laws and Approvals

 

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

 

(a)                        the Borrowers and the other
Relevant Parties and, to the best of the Borrowers’ knowledge and belief
(having made due enquiry), their respective Environmental Affiliates have
complied with the provisions of all Environmental Laws;

 

(b)                       the Borrowers and the other
Relevant Parties and, to the best of the Borrowers’ knowledge and belief
(having made due enquiry), their respective Environmental Affiliates have
obtained all Environmental Approvals and are in compliance with all such Environmental
Approvals; and

 

(c)                        neither the Borrowers nor any
other Relevant Party nor, to the best of the Borrowers’ knowledge and belief
(having made due enquiry), any of their respective Environmental Affiliates has
received notice of any Environments] Claim that the Borrowers or any of them or
any other Relevant Party or any such Environmental Affiliate is not in
compliance with any Environmental Law or any Environmental Approval;

 

7.2.12                          No Environmental Claims

 

except as may
already have been disclosed by the Borrowers in writing to, and acknowledged in
writing by, the Bank, there is no Environmental Claim pending or, to the best
of the Borrowers’ knowledge and belief, threatened against any of the Borrowers
or any of the Ships or any other Relevant Party or any other Relevant Ship or,
to the best of the Borrowers’ knowledge and belief (having made due enquiry),
any of their respective Environmental Affiliates;

 

37

 

7.2.13                          No potential Environmental
Claims

 

except as may
already have been disclosed by the Borrowers in writing to, and acknowledged in
writing by, the Bank, there has been no emission, spill, release or discharge
of a Pollutant from any of the Ships or any other Relevant Ship owned by,
managed or crewed by or chartered to any of the Borrowers nor, to the best of
the Borrowers’ knowledge and belief (having made due enquiry), from any
Relevant Ship owned by, managed or crewed by or chartered to any other Relevant
Party which could give rise to an Environmental Claim;

 

7.2.14                          No material adverse change

 

there has been
no material adverse change in the financial position of the Borrowers or the
Manager or the Corporate Guarantor or any other Relevant Party or the
consolidated financial position of the Group from that described by the
Borrowers to the Bank in the negotiation of this Agreement;

 

7.2.15                          ISPS Code

 

on the
Drawdown Date of the Delivery Advance for a Ship, the relevant Borrower shall
have a valid and current ISSC in respect of that Ship and such Ship shall be in
compliance with the ISPS Code;

 

7.2.16                          Copies true and complete -
commissions

 

(a)                        the copies of each of the
Underlying Documents (other than the Refund Guarantees) delivered or to be
delivered to the Bank pursuant to clause 9.1 are, or will when delivered be,
true and complete copies of such documents; each of such document constitutes
valid and binding obligations of the parties thereto enforceable in accordance
with its terms and there will have been no amendments or variations thereof or
defaults thereunder; and

 

(b)                       there are no address or other
commissions payable to any of the Borrowers or any other Relevant Party on
account of any of the Contracts, except as disclosed in writing by or on behalf
of the Borrowers or any other Security Party to the Bank prior to the date of
this Agreement;

 

7.2.17                          Refund Guarantees

 

the original
executed copy of each Refund Guarantee delivered or to be delivered to the Bank
pursuant to clause 9 is, or will when delivered be, a true and complete original
of such document; each such document will, when delivered, constitute valid and
binding obligations of the relevant Refund Guarantor enforceable in accordance
with its terms and there will have been no amendments or variations thereof or
defaults thereunder; and

 

7.2.18                          Application for DOC and SMC

 

the Operator
maintains a DOC for itself and, on the Drawdown Date of the Delivery Advance
for a Ship, it will have applied, for an SMC in respect of such Ship, and
neither the Borrowers nor the Operator is aware of any reason why any such
application may be refused.

 

7.3                                         Repetition of representations
and warranties

 

On and as of
each Drawdown Date and (except in relation to the representations and
warranties in clause 7.2) on each Interest Payment Date, the Borrowers shall
(a) be deemed to repeat the representations and warranties in clauses 7.1 and
7.2 as if made with reference to the facts and circumstances existing on such
day and (b) be deemed to further represent and warrant to the

 

38

 

Bank that the
then latest audited financial statements delivered by the Borrowers to the Bank
(if any) have been prepared in accordance with generally accepted international
accounting principles and practices which have been consistently applied and
present fairly and accurately the financial position of the Borrowers as at the
end of the financial period to which the same relate and the results of the
operations of the Borrowers for the financial period to which the same relate,
and, as at the end of such financial period, none of the Borrowers had any
significant liabilities (contingent or otherwise) or any unrealised or
anticipated losses which are not disclosed by, or reserved against or provided
for in, such financial statements.

 

8.                                                Undertakings

 

8.1                                         General

 

The Borrowers
jointly and severally undertake with the Bank that, from the date of this
Agreement and so long as any moneys are owing under any of the Security
Documents and while all or any part of the Commitment remains outstanding, each
Borrower will:

 

8.1.1                                Notice of Default

 

(a)                        promptly inform the Bank of any
occurrence of which it becomes aware which might adversely affect the ability
of any Security Party to perform its obligations under any of the Security Documents
or the Underlying Documents and, without limiting the generality of the
foregoing, will inform the Bank of any Default forthwith upon becoming aware
thereof and will from time to time, if so requested by the Bank, confirm to the
Bank in writing that, save as otherwise stated in such confirmation, no Default
has occurred and is continuing; and

 

(b)                       promptly inform the Bank of any
occurrence of which it becomes aware which might adversely affect the ability
or rights of any Borrower to make any claims under the Contract or any Refund
Guarantee relating to such Ship, which might reduce or release any of the
obligations of the Builder under such Contract or of the relevant Refund
Guarantor under such Refund Guarantee (as the case may be);

 

8.1.2                                Consents and licences

 

without
prejudice to clauses 7.1 and 9, obtain or cause to be obtained, maintain in
full force and effect and comply in all material respects with the conditions
and restrictions (if any) imposed in, or in connection with, every consent,
authorisation, licence or approval of governmental or public bodies or
authorities or courts and do, or cause to be done, all other acts and things
which may from time to time be necessary or desirable under applicable law for
the continued due performance of all the obligations of the Security Parties
under each of the Security Documents and the Underlying Documents;

 

8.1.3                                Use of proceeds

 

use the Loan
or, as the case may be, the Advances exclusively for the purpose specified in
clauses 1.1 and 2.3;

 

8.1.4                                Pari passu

 

ensure that
its obligations under this Agreement and the Master Swap Agreement shall,
without prejudice to the provisions of clause 8.3, at all times rank at least
pari passu with all its other present and future unsecured and unsubordinated
Indebtedness with the exception of any obligations which are mandatorily
preferred by law and not by contract;

 

39

 

8.1.5                                Financial statements

 

prepare or
cause to be prepared financial statements of each of the Borrowers in
accordance with generally accepted international accounting principles and
practices consistently applied in respect of each financial year and cause the
same to be reported on by their respective auditors and prepare or cause to be
prepared unaudited financial statements of each of the Borrowers in respect of
each financial half year on the same basis as the annual statements and deliver
to the Bank as many copies of the same as the Bank may reasonably require as
soon as practicable but not later than one hundred and eighty (180) days (in
the case of audited financial statements) and thirty (30) days (in the case of
unaudited financial statements) after the end of the financial period to which
they relate;

 

8.1.6                                Delivery of reports

 

deliver to the
Bank as many copies as the Bank may reasonably require of every report,
circular, notice or like document issued by the Borrowers, the Corporate
Guarantor, the Manager, any of their respective Related Companies or any other
member of the Group to their shareholders or creditors generally, in each case
at the time of issue thereof;

 

8.1.7                                Provision of further information

 

provide the
Bank with such financial and other information concerning the Group, the
Borrowers, the other Security Parties, the other Relevant Parties and their
respective affairs, at the earliest possible opportunity and in any event at
regular intervals of not more than three (3) months and at all other times as
the Bank may from time to time require, including, without limitation, any
management information, information relating to the Builder and the
construction of the Ships, information relating to the position, trading and/or
employment of the Ships and any actual or proposed purchase of vessels by any
member of the Group, copies of all documents required of the Corporate
Guarantor to file with the Securities and Exchange Commission of the U.S.A. or
pursuant to the Sarbanes-Oxley Act of the U.S.A. and any other documents or
information as may be reasonably required by the Bank;

 

8.1.8                                Obligations under Security
Documents

 

and will
procure that each of the other Security Parties will, duly and punctually
perform each of the obligations expressed to be assumed by it under the
Security Documents and the Underlying Documents;

 

8.1.9                                Compliance with Code

 

and will
procure that any Operator will, comply with, and ensure that each Ship and any
Operator at all times complies with, the requirements of the Code, including
(but not limited to) the maintenance and renewal of valid certificates pursuant
thereto throughout the Security Period;

 

8.1.10                          Withdrawal of DOC and SMC

 

and will
procure that any Operator will, immediately inform the Bank if there is any
threatened or actual withdrawal of such Operators DOC or the SMC in respect of
any Ship;

 

8.1.11                          Issuance of DOC and SMC

 

and will
procure that any Operator will, promptly inform the Bank upon the issuance to
any Operator of a DOC and to each Ship of an SMC or the receipt by any of the
Borrowers or any Operator of notification that its application for the same has
been refused;

 

40

 

8.1.12                          ISPS Code compliance

 

and will
procure that the Manager or any Operator will:

 

(a)                        from the Drawdown Date of the
Delivery Advance for a Ship and at all times thereafter, maintain a valid and
current ISSC in respect of that Ship;

 

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

 

(c)                        procure that, from the Drawdown
Date of the Delivery Advance for a Ship and at all times thereafter, that Ship
will comply at all times with the ISPS Code; and

 

8.1.13                          “KYC” requirements

 

deliver to the
Bank such documents and evidence as the Bank shall from time to time require,
based on applicable law and regulations and the Bank’s own internal guidelines
from time to time, in each case, relating to the verification of identity and
knowledge of the Bank’s customers.

 

8.2                                         Security value maintenance

 

8.2.1                                Security shortfall

 

If, at any
time after the Drawdown Date of the first Delivery Advance to be drawn down,
the Security Value shall be less than the Security Requirement, the Bank may
give notice to the Borrowers requiring that such deficiency be remedied and
then the Borrowers shall at its discretion either:

 

(a)                        prepay within a period of
fourteen (14) days of the date of receipt by the Borrowers of the Bank’s said
notice such sum in Dollars as will result in the Security Requirement after
such prepayment (taking into account any other repayment made in accordance
with clause 4.1 between the date of the notice and the date of such prepayment)
being at least equal to the Security Value; or

 

(b)                       within fourteen (14) days of the
date of receipt by the Borrowers of the Bank’s said notice constitute to the
satisfaction of the Bank such further security for the Loan as shall be
acceptable to the Bank having a value for security purposes (as determined by
the Bank in its discretion) at the date upon which such further security shall
be constituted which, when added to the Security Value, shall not be less than
the Security Requirement as at such date.

 

The provisions
of clauses 4.4 and 4.5 shall apply to prepayments made under clause 8.2.1(a).

 

8.2.2                                Valuation of Mortgaged Ships

 

Each Mortgaged
Ship shall, for the purposes of this clause 8.2, be valued in Dollars as and
when the Bank shall require by an independent firm of shipbrokers nominated by
the Borrowers and approved by the Bank in its sole discretion or, failing such
nomination or approval, appointed by the Bank in its sole discretion. Each such
valuation of a Mortgaged Ship shall be addressed to the Bank and made without,
unless required by the Bank, physical inspection and on the basis of a sale for
prompt delivery for cash at arm’s length on normal commercial terms, as between
a willing buyer and a willing seller and without taking into account the
benefit of any charterparty or other engagement concerning the relevant
Mortgaged Ship. Such valuation shall constitute the value of such Mortgaged
Ship for the purposes of this clause 8.2 unless the Bank objects to the
valuation of the relevant Mortgaged Ship provided by the shipbroker nominated
by the Borrowers within seven (7) days of receipt of such valuation, in which
event the value of such Mortgaged Ship shall be the mean of the value specified
in such valuation and the value

 

41

 

specified in a
further valuation issued by an independent firm of shipbrokers appointed by the
Bank and made on the same basis as specified above.

 

The value of
each Mortgaged Ship determined in accordance with the provisions of this clause
8.2 shall be binding upon the parties hereto until such time as any such
further valuations shall be obtained.

 

8.2.3                                Information

 

The Borrowers
jointly and severally undertake to the Bank to supply to the Bank and to any
such shipbrokers such information concerning each Mortgaged Ship and its
condition as such shipbrokers may reasonably require for the purpose of making
any such valuation.

 

8.2.4                                Costs

 

All costs in
connection with the Bank obtaining any valuation of each of the Mortgaged Ships
referred to in clause 8.2.2 and in schedule 2, Part 6, paragraph 19, and any
valuation either of any additional security for the purposes of ascertaining
the Security Value at any time or necessitated by the Borrowers electing to
constitute additional security pursuant to clause 8.2.1(b), shall be borne by
the Borrowers.

 

8.2.5                                Valuation of additional security

 

For the
purposes of this clause 8.2, the market value of any additional security
provided or to be provided to the Bank shall be determined by the Bank in its
absolute discretion without any necessity for the Bank assigning any reason
thereto.

 

8.2.6                                Documents and evidence

 

In connection
with any additional security provided in accordance with this clause 8.2, the
Bank shall be entitled to receive such evidence and documents of the kind
referred to in schedule 2 as may in the Bank’s opinion be appropriate and such
favourable legal opinions as the Bank shall in its absolute discretion require.

 

8.3                                         Negative undertakings

 

The Borrowers
jointly and severally undertake with the Bank that, from the date of this
Agreement and so long as any moneys are owing under the Security Documents and
while all or any part of the Commitment remains outstanding, they will not,
without the prior written consent of the Bank:

 

8.3.1                                Negative pledge

 

permit any
Encumbrance (other than a Permitted Encumbrance) to subsist, arise or be
created or extended over all or any part of their respective present or future
undertakings, assets, rights or revenues (including, but not limited to, the
Borrowers’ rights against the Bank under any Transactions and/or the Master
Swap Agreement or all or any part of the Borrowers’ interest in any amount
payable to the Borrowers by the Bank under any Transactions and/or the Master
Swap Agreement) in order to secure or prefer any present or future Indebtedness
or other liability or obligation of the Borrowers or any of them or any
Security Party or any other person;

 

8.3.2                                No merger

 

merge or
consolidate with any other person or enter into any demerger, amalgamation,
corporate reconstruction or redomiciliation of any type;

 

42

 

8.3.3                                Disposals

 

sell,
transfer, abandon, lend or otherwise dispose of or cease to exercise direct
control over any part (being either alone or when aggregated with all other
disposals falling to be taken into account pursuant to this clause 8.3.3 material
in the opinion of the Bank in relation to the undertaking, assets, rights and
revenues of the relevant Borrower taken as a whole) of their respective present
or future undertaking, assets, rights or revenues (otherwise than by transfers,
sales or disposals for full consideration in the ordinary course of trading)
whether by one or a series of transactions related or not;

 

8.3.4                                Other business

 

undertake any
business other than the ownership and operation of the Ships and the chartering
of the Ships to third parties;

 

8.3.5                                Acquisitions

 

acquire any
further assets other than the Ships and rights arising under contracts entered
into by or on behalf of the relevant Borrower in the ordinary course of its
business of owning, operating and chartering the Ships;

 

8.3.6                                Other obligations

 

incur any
obligations except for obligations arising under the Underlying Documents or
the Security Documents or contracts entered into in the ordinary course of
their business of owning, operating and chartering the Ships;

 

8.3.7                                No borrowing

 

incur any
Indebtedness except for Indebtedness pursuant to the Security Documents;

 

8.3.8                                Repayment of borrowings

 

repay the
principal of, or pay interest on or any other sum in connection with any of
their Indebtedness except for Indebtedness pursuant to the Security Documents;

 

8.3.9                                Guarantees

 

issue any
guarantees or indemnities or otherwise become directly or contingently liable
for the obligations of any person, firm or corporation except pursuant to the
Security Documents and except for guarantees or indemnities from time to time
required in the ordinary course by any protection and indemnity or war risks
association with which a Ship is entered, guarantees required to procure the
release of a Ship from any arrest, detention, attachment or levy or guarantees
or undertakings required for the salvage of a Ship;

 

8.3.10                          Loans

 

make any loans
or grant any credit (save for normal trade credit in the ordinary course of
business) to any person or agree to do so;

 

8.3.11                          Sureties

 

permit any Indebtedness
of the Borrowers to any person (other than the Bank) to be guaranteed by any
person (save for guarantees or indemnities from time to time required in the
ordinary course by any protection and indemnity or war risks association with
which a Ship is entered,

 

43

 

guarantees
required to procure the release of a Ship from any arrest, detention,
attachment or levy or guarantees or undertakings required for the salvage of a
Ship);

 

8.3.12                          Share capital and distribution

 

purchase or
otherwise acquire for value any shares of their capital or distribute any of
their other present or future assets, undertakings, rights or revenues to any
of their shareholders or, following an Event of Default or if an Event of
Default is likely to occur as a result thereof, declare or pay any dividends;

 

8.3.13                          Subsidiaries

 

form or
acquire any Subsidiaries;

 

8.3.14                          Manager

 

appoint any
manager of any of the Ships other than the Manager or terminate or amend the
terms of any of the Management Agreements; or

 

8.3.15                          Shareholdings

 

(a)                        change, cause or permit any
change in, the legal and/or ultimate beneficial ownership of any of the shares
in the Corporate Guarantor which would result in Mr. Dimitrios Melissanidis
being the ultimate beneficial owner of less than 35% of the total issued voting
share capital of the Corporate Guarantor; or

 

(b)                       change, cause or permit any
change in, the legal and/or beneficial ownership of any of the shares in any
Borrower or the Manager which would result in any such Security Party ceasing
to be a wholly-owned direct or indirect Subsidiary of the Corporate Guarantor.

 

8.4                                         Pre-delivery positive
undertakings

 

The Borrowers
hereby jointly and severally undertake and agree with the Bank that they will:

 

8.4.1                                Conveyance on default

 

where any Ship
is (or is to be) sold in exercise of any power contained in the relevant
Pre-delivery Security Assignment or otherwise conferred on the Bank, execute,
forthwith upon request by the Bank, such form of conveyance of such Ship as the
Bank may require;

 

8.4.2                                Flag State

 

not later than
thirty (30) days prior to the Delivery Date of each Ship, obtain the Bank’s
written approval of the Flag State for such Ship; and

 

8.4.3                                Mortgage

 

immediately
upon Delivery of each Ship procure that the relevant Borrower shall execute,
and procure the registration of, the Mortgage over such Ship under the laws and
flag of the relevant Flag State and provide all other documents and evidence as
specified in Part 6 of schedule 2 in respect of such Ship.

 

44

 

8.5                                         Pre-delivery negative
undertaking

 

The Borrowers
hereby jointly and severally further undertake and agree with the Bank that
they will not, without the prior written consent of the Bank (and then only
subject to such conditions as the Bank may impose, let or agree to) let any
Ship:

 

8.5.1                                on demise charter for any
period; or

 

8.5.2                                by any time or consecutive
voyage charter for a term which exceeds or which by virtue of any optional extensions
therein contained may exceed twelve (12) months’ duration; or

 

8.5.3                                on terms whereby more than two
(2) months’ hire (or the equivalent) is payable in advance; or

 

8.5.4                                below the market rate prevailing
at the time when the relevant Ship is fixed.

 

9.                                                Conditions

 

9.1                                         Documents and evidence

 

9.1.1                                Commitment

 

The obligation
of the Bank to make the Commitment available shall be subject to the condition
that the Bank or its duly authorised representative shall have received, not
later than two (2) Banking Days before the date of this Agreement, the
documents and evidence specified in Part 1 of schedule 2, in form and substance
satisfactory to the Bank.

 

9.1.2                                First Advances

 

The obligation
of the Bank to make available the First Advance in respect of any Ship shall be
subject to the condition that the Bank or its duly authorised representative
shall have received, on or prior to the drawdown of the relevant First Advance,
the documents and evidence specified in Part 2 of schedule 2 in respect of such
Ship, in form and substance satisfactory to the Bank.

 

9.1.3                                Second Advances

 

The obligation
of the Bank to make available the Second Advance in respect of any Ship shall
be subject to the condition that the Bank or its duly authorised representative
shall have received, on or prior to the drawdown of the relevant Second
Advance, the relevant documents and evidence specified in Part 3 of schedule 2
in respect of such Ship, in form and substance satisfactory to the Bank.

 

9.1.4                                Third Advances

 

The obligation
of the Bank to make available the Third Advance in respect of any Ship shall be
subject to the condition that the Bank or its duly authorised representative
shall have received, on or prior to the drawdown of the relevant Third Advance,
the relevant documents and evidence specified in Part 4 of schedule 2 in
respect of such Ship, in form and substance satisfactory to the Bank.

 

9.1.5                                Fourth Advances

 

The obligation
of the Bank to make available the Fourth Advance in respect of any Ship shall
be subject to the conduction that the Bank or its duly authorised respective
shall have received, on or prior to the drawdown of the relevant Fourth
Advance, the documents and evidence specified in Part 5 of schedule 2 in
respect of such Ship, in form and substance satisfactory to the Bank.

 

45

 

9.1.6                                Delivery Advances

 

The obligation
of the Bank to make available the Delivery Advance in respect of any Ship shall
be subject to the condition that the Bank or its duly authorised representative
shall have received, on or prior to the drawdown of the relevant Delivery
Advance, the documents and evidence specified in Part 6 of schedule 2 in
respect of such Ship, in form and substance satisfactory to the Bank.

 

9.2                                         General conditions precedent

 

The obligation
of the Bank to make any Advance available shall be subject to the further
conditions that, at the time of the giving of the Drawdown Notice in respect of
the relevant Advance and at the time of the making of the relevant Advance:

 

9.2.1                                  the representations and
warranties contained in (i) clauses 7.1, 7.2 and 7.3(b) and (ii) clause 4 of
the Corporate Guarantee, are true and correct on and as of each such time as if
each was made with respect to the facts and circumstances existing at such
time; and

 

9.2.2                                  no Default shall have occurred
and be continuing or would result from the making of such Advance.

 

9.3                                         Waiver of conditions precedent

 

The conditions
specified in this clause 9 are inserted solely for the benefit of the Bank and
may be waived by the Bank in whole or in part and with or without conditions.

 

9.4                                         Further conditions precedent

 

Not later than
five
(5) Banking Days prior to each Drawdown Date and not later
than five (5) Banking Days prior to each Interest Payment Date, the Bank may
request and the Borrowers shall, not later than two (2) Banking Days prior to
such date, deliver to the Bank on such request further favourable certificates
and/or opinions as to any or all of the matters which are the subject of
clauses 7, 8, 9 and 10 of this Agreement.

 

10.                                         Events of Default

 

10.1                                  Events

 

There shall be
an Event of Default if:

 

10.1.1                          Non-payment:  any Security Party fails to pay any sum
payable by it under any of the Security Documents or the Underlying Documents
at the time, in the currency and in the manner stipulated in the Security
Documents or the Underlying Documents (and so that, for this purpose, sums
payable on demand shall be treated as having been paid at the stipulated time
if paid within three (3) Banking Days of demand); or

 

10.1.2                          Master Swap Agreement:  (i) an Event of Default or Potential
Event of Default (in each case as defined in the Master Swap Agreement) has
occurred and is continuing under the Master Swap Agreement or (ii) an
Early Termination Date (as defined in the Master Swap Agreement) has occurred
or been effectively designated under the Master Swap Agreement or (iii) a
person entitled to do so gives notice of an Early Termination Date (as defined
in the Master Swap Agreement) under section 6(b)(iv) of the Master Swap
Agreement or (iv) the Master Swap Agreement is terminated, cancelled,
suspended, rescinded or revoked or otherwise ceases to remain in full force and
effect for any reason; or

 

46

 

10.1.3                          Breach of Insurance and
certain other obligations:  any of the Borrowers or the
Manager fails to obtain and/or maintain the Insurances (in accordance with the
requirements of the Security Documents) for any of the Ships or if any insurer
in respect of such Insurances cancels any of such Insurances or disclaims
liability by reason, in either case, of mis-statement in any proposal for any
of such Insurances or for any other failure or default on the part of the
Borrowers or any of them or any other person or the Borrowers or the Corporate
Guarantor commit any breach of or omit to observe any of the obligations or
undertakings expressed to be assumed by them under clauses 8.2, 8.3, 8.4 or 8.5
of this Agreement or clauses 5.1.5 or 5.2 of the Corporate Guarantee, respectively;
or

 

10.1.4                          Breach of other
obligations:  any Security Party commits any
breach of or omits to observe any of its obligations or undertakings expressed
to be assumed by it under any of the Security Documents or any of the
Underlying Documents (other than those referred to in clauses 10.1.1, 10.1.2
and 10.1.3 above) and, in respect of any such breach or omission which in the
opinion of the Bank is capable of remedy, such action as the Bank may require
shall not have been taken within fourteen (14) days of the Bank notifying the
relevant Security Party of such default and of such required action; or

 

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

 

10.1.6                          Cross-default:  any
Indebtedness of any Relevant Party is not paid when due or any Indebtedness of
any Relevant Party becomes (whether by declaration or automatically in
accordance with the relevant agreement or instrument constituting the same) due
and payable prior to the date when it would otherwise have become due (unless
as a result of the exercise by the relevant Relevant Party of a voluntary right
of prepayment) or any creditor of any Relevant Party becomes entitled to
declare any such Indebtedness due and payable or any facility or commitment
available to any Relevant Party relating to Indebtedness is withdrawn,
suspended or cancelled by reason of any default (howsoever described) of the
person concerned unless the relevant Relevant Party shall have satisfied the
Bank that such withdrawal, suspension or cancellation will not affect or
prejudice in any way the relevant Relevant Party’s ability to pay its debts as
they fall due and fund its commitments, or any guarantee given by any Relevant
Party in respect of Indebtedness is not honoured when due and called upon; or

 

10.1.7                          Legal process:  any judgment or order made against any
Relevant Party is not stayed or complied with within seven (7) days or a
creditor attaches or takes possession of, or a distress, execution,
sequestration or other process is levied or enforced upon or sued out against,
any of the undertakings, assets, rights or revenues of any Relevant Party and
is not discharged within seven (7) days; or

 

10.1.8                          Insolvency:  any
Relevant Party is unable or admits inability to pay its debts as they fall due;
suspends making payments on any of its debts or announces an intention to do
so; becomes insolvent; has assets the value of which is less than the value of
its liabilities (taking into account contingent and prospective liabilities);
or suffers the declaration of a moratorium in respect of any of its
Indebtedness; or

 

10.1.9                          Reduction  or loss of capital:  a meeting is convened by any Relevant Party
for the purpose of passing any resolution to purchase or reduce its share
capital or to redeem any of its shares; or

 

10.1.10                    Winding up:  any corporate action, legal proceedings or
other procedure or step is taken for the purpose of winding up any Relevant
Party or an order is made or resolution passed for the winding up of any
Relevant Party or a notice is issued convening a meeting for the purpose of
passing any such resolution; or

 

47

 

10.1.11                    Administration:  any petition is presented, notice given or
step is taken for the purpose of the appointment of an administrator of any
Relevant Party or the Bank believes that any such petition or other step is
imminent or an administration order is made in relation to any Relevant Party;
or

 

10.1.12                    Appointment of receivers and managers:  any administrative or other receiver is
appointed of any Relevant Party or any part of its assets and/or undertaking or
any other steps are taken to enforce any Encumbrance over all or any part of
the assets of any Relevant Party; or

 

10.1.13                    Compositions:  any corporate action, legal proceedings or
other procedures or steps are taken, or negotiations commenced, by any Relevant
Party or by any of its creditors with a view to the general readjustment or
rescheduling of all or part of its indebtedness or to proposing any kind of
composition, compromise or arrangement involving such company and any of its
creditors; or

 

10.1.14                    Analogous
proceedings:  there occurs, in relation to any
Relevant Party, in any country or territory in which any of them carries on
business or to the jurisdiction of whose courts any part of their assets is
subject, any event which, in the reasonable opinion of the Bank, appears in
that country or territory to correspond with, or have an effect equivalent or
similar to, any of those mentioned in clauses 10.1.7 to 10.1.13 (inclusive) or
any Relevant Party otherwise becomes subject, in any such country or territory,
to the operation of any law relating to insolvency, bankruptcy or liquidation;
or

 

10.1.15                    Cessation of
business:  any Relevant Party suspends or
ceases or threatens to suspend or cease to carry on its business; or

 

10.1.16                    Seizure:  all
or a material part of the undertaking, assets, rights or revenues of, or shares
or other ownership interests in, any Relevant Party are seized, nationalised,
expropriated or compulsorily acquired by or under the authority of any
government; or

 

10.1.17                    Invalidity:  any of the Security Documents shall at any
time and for any reason become invalid or unenforceable or otherwise cease to
remain in full force and effect, or if the validity or enforceability of any of
the Security Documents shall at any time and for any reason be contested by any
Security Party which is a party thereto, or if any such Security Party shall
deny that it has any, or any further, liability thereunder; or

 

10.1.18                    Unlawfulness:  it becomes impossible or unlawful at any time for any Security Party, to
fulfil any of the covenants and obligations expressed to be assumed by it in
any of the Security Documents or for the Bank to exercise the rights or any of
them vested in it under any of the Security Documents or otherwise; or

 

10.1.19                    Repudiation:  any Security Party repudiates any of the
Security Documents or does or causes or permits to be done any act or thing
evidencing an intention to repudiate any of the Security Documents; or

 

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

 

10.1.21                    Material adverse change:  there occurs, in the reasonable opinion of the
Bank, a material adverse change in the financial condition of any Security
Party or the Group by reference to the financial position of that Security
Party or the Group as described by or on behalf of the Borrowers or any
Security Party to the Bank in the negotiation of this Agreement; or

 

10.1.22                    Arrest:  any Ship is arrested, confiscated, seized,
taken in execution, impounded, forfeited, detained in exercise or purported
exercise of any possessory lien or other claim or otherwise

 

48

 

taken from the
possession of the relevant Borrower and such Borrower shall fail to procure the
release of such Ship within a period of two (2) days thereafter; or

 

10.1.23                    Registration:  the registration of any Ship under the laws
and flag of the relevant Flag State is cancelled or terminated without the
prior written consent of the Bank or if such registration of any Ship is not
renewed at least forty five (45) days prior to the expiry of such registration;
or

 

10.1.24                    Unrest:  any Flag State becomes involved in hostilities
or civil war or there is a seizure of power in any Flag State by
unconstitutional means if, in any such case, such event could in the opinion of
the Bank reasonably be expected to have a material adverse effect on the
security constituted by any of the Security Documents; or

 

10.1.25                    Environment:  any of the Borrowers and/or any other Relevant
Party and/or any of their respective Environmental Affiliates fails to comply
with any Environmental Law or any Environmental Approval or any of the
Borrowers and/or any other Relevant Party and/or any of their respective
Environmental Affiliates or any Ship or any other Relevant Ship is involved in
any incident which gives rise or may give rise to an Environmental Claim if, in
any such case, such non-compliance or incident or the consequences thereof
could, in the opinion of the Bank reasonably be expected to have a material
adverse effect on the business, assets, operations, property or financial
condition of any of the Borrowers or the Corporate Guarantor or any other
Security Party or on the security constituted by any of the Security Documents;
or

 

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

 

10.1.27                      Shareholdings:

 

(a)                        there is any change in the legal
and/or ultimate beneficial ownership of any of the shares in the Corporate
Guarantor which results in Mr. Dimitrios Melissanidis being the ultimate
beneficial owner of less than 35% of the total issued voting share capital of
the Corporate Guarantor; or

 

(b)                       there is any change in the legal
and/or beneficial ownership of any of the shares in any Borrower or the Manager
which results in any such Security Party ceasing to be a wholly-owned direct or
indirect Subsidiary of the Corporate Guarantor; or

 

10.1.28                    Termination or variation
of, or dispute under, Contracts:  any Contract is
terminated or rescinded for any reason whatsoever, or any Contract is frustrated;
or any Contract is varied in any manner not permitted by or pursuant to the
relevant Pre-delivery Security Assignment or this Agreement; or there is any
dispute or litigation or any other proceedings between the relevant parties
under or in respect of any Contract; or

 

10.1.29                    Termination of Refund Guarantees:  any
Refund Guarantee expires or is repudiated, cancelled, rescinded or otherwise
terminated (other than by the return of such Refund Guarantee by the relevant
Borrower to the Builder and/or the relevant Refund Guarantor following the
Delivery of the Ship to which such Refund Guarantee relates); or

 

10.1.30                    Non-delivery of Ships:  any Ship is not delivered to, and accepted by,
the relevant Borrower under the relevant Contract or the Delivery Advance for
any Ship is not drawn down, in either case, on or before the end of the
Drawdown Period for the Delivery Advance relevant to such Ship; or

 

49

 

10.1.31                    Operating Accounts:  moneys are withdrawn from any of the Operating
Accounts other than in accordance with clause 14; or

 

10.1.32                    Listing:  the shares of the Corporate Guarantor are
de-listed or suspended from, or cease to trade (whether temporarily or
permanently) on, the New York Stock Exchange;

 

10.1.33                    Licenses, etc.:  any license, authorisation, consent or
approval at any time necessary to enable any Security Party to comply with its
obligations under the Security Documents or the Underlying Documents is revoked
or withheld or modified or is otherwise not granted or fails to remain in full
force and effect or if any exchange control or other law or regulation shall
exist which would make any transaction under the Security Documents or the
Underlying Documents or the continuation thereof, unlawful or would prevent the
performance by any Security Party of any term of any of the Security Documents
or the Underlying Documents; or

 

10.1.34                    Material events:  any other event occurs or circumstance arises
which, in the reasonable opinion of the Bank, is likely materially and
adversely to affect either (i) the ability of any Security Party to perform all
or any of its obligations under or otherwise to comply with the terms of any of
the Security Documents or (ii) the security created by any of the Security Documents.

 

10.2                                  Acceleration

 

The Bank may,
without prejudice to any other rights of the Bank, at any time after the
happening of an Event of Default by notice to the Borrowers declare that:

 

10.2.1                          the obligation of the Bank to
make the Commitment available shall be terminated, whereupon the Commitment
shall be reduced to zero forthwith; and/or

 

10.2.2                          the Loan and all interest and
commitment commission accrued and all other sums payable under the Security
Documents have become due and payable, whereupon the same shall, immediately or
in accordance with the terms of such notice, become due and payable.

 

10.3                                  Demand basis

 

If, pursuant
to clause 10.2.2, the Bank declares the Loan to be due and payable on demand,
the Bank may by written notice to the Borrowers (a) call for repayment of the
Loan on such date as may be specified whereupon the Loan shall become due and
payable on the date so specified together with all interest and commitment
commission accrued and all other sums payable under this Agreement or (b)
withdraw such declaration with effect from the date specified in such notice.

 

11.                                         Indemnities

 

11.1                                  Miscellaneous indemnities

 

The Borrowers
shall on demand indemnify the Bank, without prejudice to any of the Bank’s
other rights under any of the Security Documents, against any loss (including
loss of Margin) or expense which the Bank shall certify as sustained or
incurred by it as a consequence of:

 

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

 

11.1.2                          the occurrence of any other
Event of Default;

 

11.1.3                          any prepayment or reduction of a
Tranche or part thereof being made under clauses 4.3, 8.2.1 or 12.1 or any
other repayment or prepayment of a Tranche or part thereof being made

 

50

 

otherwise
than on an Interest Payment Date relating to the part of the Tranche prepaid or
repaid; or

 

11.1.4                          any Advance not being made for
any reason (excluding any default by the Bank) after the Drawdown Notice in relation
thereto has been given,

 

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

 

11.2                                  Currency indemnity

 

If any sum due
from the Borrowers under any of the Security Documents or any order or judgment
given or made in relation thereto has to be converted from the currency (the “first currency”)
in which the same is payable under the relevant Security Document or under such
order or judgment into another currency (the “second currency”) for the purpose of (a)
making or filing a claim or proof against the Borrowers or any of them, (b)
obtaining an order or judgment in any court or other tribunal or (c) enforcing
any order or judgment given or made in relation to any of the Security
Documents, the Borrowers shall indemnify and hold harmless the Bank from and
against any loss suffered as a result of any difference between (i) the rate of
exchange used for such purpose to convert the sum in question from the first
currency into the second currency and (ii) the rate or rates of exchange at
which the Bank may in the ordinary course of business purchase the first
currency with the second currency upon receipt of a sum paid to it in
satisfaction, in whole or in part, of any such order, judgment, claim or proof.
Any amount due from the Borrowers under this clause 11.2 shall be due as a
separate debt and shall not be affected by judgment being obtained for any
other sums due under or in respect of any of the Security Documents and the
term “rate
of exchange” includes any premium and costs of exchange payable in
connection with the purchase of the first currency with the second currency.

 

11.3                                  Environmental indemnity

 

The Borrowers
shall indemnify the Bank on demand and hold the Bank harmless from and against
all costs, expenses, payments, charges, losses, demands, liabilities, actions,
proceedings (whether civil or criminal), penalties, fines, damages, judgements,
orders, sanctions or other outgoings of whatever nature which may be suffered,
incurred or paid by, or made or asserted against the Bank at any time, whether
before or after the repayment in full of principal and interest under this
Agreement, relating to, or arising directly or indirectly in any manner or for
any cause or reason whatsoever out of an Environmental Claim made or asserted
against the Bank if such Environmental Claim would not have been, or been
capable of being, made or asserted against the Bank if it had not entered into
any of the Security Documents and/or exercised any of its rights, powers and
discretions thereby conferred and/or performed any of its obligations
thereunder and/or been involved in any of the transactions contemplated by the
Security Documents.

 

12.                                         Unlawfulness and increased costs

 

12.1                                  Unlawfulness

 

If it is or
becomes contrary to any law or regulation for the Bank to make any Advance or
to maintain the Commitment or fund the Loan, the Bank shall promptly give
notice to the Borrowers whereupon (a) the Commitment shall be reduced to zero
and (b) the Borrowers shall be obliged to prepay the Loan either (i) forthwith
or (ii) on a future specified date not being earlier than the latest date
permitted by the relevant law or regulation together with interest and
commitment commission accrued to the date of prepayment and all other sums
payable by the Borrowers under this Agreement and/or the Master Swap Agreement.

 

51

 

12.2                                  Increased costs

 

If the result
of any change in, or in the interpretation or application of, or the
introduction of, any law or any regulation, request or requirement (whether or
not having the force of law, but, if not having the force of law, with which
the Bank or, as the case may be, its holding company habitually complies),
including (without limitation) those relating to Taxation, capital adequacy,
liquidity, reserve assets, cash ratio deposits and special deposits, is to:

 

12.2.1                          subject the Bank to Taxes or
change the basis of Taxation of the Bank with respect to any payment under any
of the Security Documents (other than Taxes or Taxation on the overall net
income, profits or gains of the Bank imposed in the jurisdiction in which its
principal or lending office under this Agreement is located); and/or

 

12.2.2                          increase the cost to, or impose
an additional cost on, the Bank or its holding company in making or keeping the
Commitment available or maintaining or funding all or part of the Loan; and/or

 

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

 

12.2.4                          reduce the Bank’s or its holding
company’s rate of return on its overall capital by reason of a change in the
manner in which it is required to allocate capital resources to the Bank’s
obligations under any of the Security Documents; and/or

 

12.2.5                          require the Bank or its holding
company to make a payment or forego a return on or calculated by reference to
any amount received or receivable by the Bank under any of the Security
Documents; and/or

 

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

 

then and in
each such case (subject to clause 12.3):

 

(a)                        the Bank shall notify the
Borrowers in writing of such event promptly upon its becoming aware of the same;
and

 

(b)                       the Borrowers shall on demand
pay to the Bank the amount which the Bank specifies (in a certificate and
supporting documents setting forth and evidencing the basis of the computation
of such amount but not including any matters which the Bank or its holding
company regards as confidential) is required to compensate the Bank and/or (as
the case may be) its holding company for such liability to Taxes, cost,
reduction, payment, foregone return or loss.

 

For the
purposes of this clause 12.2, “holding company”
means the company or entity (if any) within the consolidated supervision of
which the Bank is included.

 

12.3                                  Exception

 

Nothing in
clause 12.2 shall entitle the Bank to receive any amount in respect of
compensation for any such liability to Taxes, increased or additional cost,
reduction, payment, foregone return or loss (a) to the extent that the same is
taken into account in calculating the Additional Cost or (b) to the extent that
the same is the subject of an additional payment under clause 6.6.

 

52

 

13.                                         Security and set-off

 

13.1                                  Application of moneys

 

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

 

13.1.1                          first, in or towards payment of
all unpaid costs, expenses, fees and commitment commission which may be owing
to the Bank under any of the Security Documents;

 

13.1.2                          secondly, in or towards payment
of any arrears of interest owing in respect of the Loan or any part thereof;

 

13.1.3                          thirdly, in or towards repayment
of the Loan (whether the same is due and payable or not);

 

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

 

13.1.5                          fifthly, in or towards payment
to the Bank of any sum owing under the Master Swap Agreement;

 

13.1.6                          sixthly, in or towards payment
to the Bank of any other sums owing to it under any of the Security Documents;
and

 

13.1.7                          seventhly, the surplus (if any)
shall be paid to the Borrowers or to whomsoever else may be entitled to receive
such surplus.

 

13.2                                  Set-off

 

13.2.1                          The Borrowers authorise the Bank
(without prejudice to any of the Bank’s rights at law, in equity or otherwise),
at any time and without notice to the Borrowers, to apply any credit balance to
which the Borrowers or any of them is then entitled standing upon any account
of the Borrowers or any of them with any branch of the Bank in or towards
satisfaction of any sum due and payable from the Borrowers or any of them to
the Bank under any of the Security Documents. For this purpose, the Bank is
authorised to purchase with the moneys standing to the credit of such account
such other currencies as may be necessary to effect such application.

 

13.2.2                          Without prejudice to its rights
hereunder and/or under the Master Swap Agreement, the Bank may at the same time
as, or at any time after, any Default under this Agreement or the Borrowers’
default under the Master Swap Agreement, set-off any amount due now or in the
future from the Borrowers or any of them to the Bank under this Agreement
against any amount due from the Bank to the Borrowers or any of them under the
Master Swap Agreement and apply the first amount in discharging the second
amount. The effect of any set-off under this sub-clause 13.2.2 shall be
effective to extinguish or, as the case may require, reduce the liabilities of
the Bank under the Master Swap Agreement.

 

13.2.3                          The Bank shall not be obliged to
exercise any right given to it by this clause 13.2. The Bank shall notify the
Borrowers forthwith upon the exercise or purported exercise of any right of
set-off giving full details in relation thereto.

 

13.3                                  Further assurance

 

The Borrowers
jointly and severally undertake with the Bank that the Security Documents shall
both at the date of execution and delivery thereof and so long as any moneys
are owing under any of the Security Documents be valid and binding obligations
of the respective parties thereto

 

53

 

and rights of
the Bank enforceable in accordance with their respective terms and that it
will, at its expense, execute, sign, perfect and do, and will procure the
execution, signing, perfecting and doing by each of the other Security Parties
of, any and every such further assurance, document, act or thing as in the
reasonable opinion of the Bank may be necessary or desirable for perfecting the
security contemplated or constituted by the Security Documents.

 

13.4                                  Conflicts

 

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

 

14.                                         Operating Accounts

 

14.1                                  General

 

The Borrowers
jointly and severally undertake with the Bank that they will:

 

14.1.1                          on or before the date of this
Agreement, open each of the Operating Accounts; and

 

14.1.2                          procure that all moneys payable
to each Borrower in respect of the Earnings of such Borrowers Ship shall,
unless and until the Bank directs to the contrary pursuant to the provisions of
the relevant Deed of Covenant, be paid to the Operating Account for such Ship,
Provided however that if any of the moneys paid to the relevant Operating
Account are payable in a currency other than Dollars, the Bank shall (and each
Borrower in respect of its Operating Account hereby irrevocably instructs the
Bank to) convert such moneys into Dollars at the Bank’s spot rate of exchange
at the relevant time for the purchase of Dollars with such currency and the
term “spot rate of
exchange” shall include any premium and costs of exchange payable in
connection with the purchase of Dollars with such currency.

 

14.2                                  Operating Accounts: withdrawals

 

Unless the
Bank otherwise agrees in writing, no Borrower shall be entitled to withdraw any
moneys from its Operating Account at any time from the date of this Agreement
and so long as any moneys are owing under the Security Documents save that,
unless and until a Default shall occur and the Bank shall direct to the
contrary, each Borrower may withdraw moneys from its Operating Account for the
following purposes:

 

14.2.1                          to pay any unpaid costs,
expenses, fees and commitment commission which may be owing to the Bank under
any of the Security Documents;

 

14.2.2                          to pay any amount to the Bank in
or towards payments of any instalments of interest or principal or any other
amounts then payable pursuant to the Security Documents;

 

14.2.3                          to pay the proper and reasonable
expenses of its Ship; and

 

14.2.4                          to pay the proper and reasonable
expenses of administering its affairs; and

 

14.2.5                          to make as other payment not
expressly prohibited by the terms of this Agreement or any other Security
Document,

 

Provided
however that if, in the opinion of the Bank, there are insufficient sums
standing to the credit of the Operating Accounts to meet principal and interest
falling due on the next Repayment Date and the next Interest Payment Date or
any other moneys which are or will become due and payable to the Bank, the
Borrowers shall not be entitled to make any withdrawal under clauses 14.2.4 and
14.2.5 without the prior written consent of the Bank.

 

54

 

14.3                                  Interest

 

Amounts
standing to the credit of each Operating Account shall bear interest at the
rate (unless otherwise agreed between the Bank and the relevant Borrower) which
is certified by the Bank to that Borrower to be the rate quoted by the Bank to
its customers for deposits in Dollars for such period as the Bank may determine
and in an amount comparable with the amount for the time being standing to the
credit of that Operating Account, such interest to be credited to such
Operating Account at the expiry of each such period of deposit and to accrue
from day to day and to be calculated on the basis of a three hundred and sixty
(360) day year and the actual number of days elapsed.

 

14.4                                  Set-off

 

Without in any
way affecting the rights of the Bank under clause 13.2, upon the occurrence of
a Default or at any time thereafter the Bank shall be entitled to set-off and
apply all sums standing to the credit of any Operating Account and accrued
interest (if any) thereon without notice to the Borrowers in the manner
specified in clause 13.1.

 

14.5                                  Deductions

 

The Bank shall
be entitled (but not obliged) at any time to deduct from the balance for the
time being standing to the credit of any Operating Account all other moneys
which may fall due to be paid to the Bank under the terms of this Agreement and
the other Security Documents or otherwise howsoever in connection with the Loan
and/or the Master Swap Agreement.

 

14.6                                  Charging of Operating Accounts

 

Each Borrower with
full title guarantee hereby charges and agrees to charge, by way of first fixed
charge and releases and agrees to release to the Bank, as a continuing security
for the payment of the Loan, interest thereon and all other moneys from time to
time owing under this Agreement, the Master Swap Agreement and the other
Security Documents (for the purposes of this clause 14.6, the “Outstanding Indebtedness”), such Borrower’s Operating Account
and all moneys from time to time standing to the credit of such Operating
Account, including any interest from time to time accrued and accruing thereon
(whether or not credited thereto) and no Borrower shall be entitled to withdraw
any such monies from its Operating Account otherwise than in accordance with
this clause 14 until such time as the Outstanding Indebtedness has been
conclusively certified by the Bank to have been repaid in full.

 

14.7                                  Representations and warranties

 

Each Borrower
hereby represents and warrants to the Bank that:

 

14.7.1                          it is the sole, absolute, legal
and beneficial owner of, and has good right and title to its Operating Account;
and

 

14.7.2                          neither its Operating Account
nor any part thereof is subject to any Encumbrance save as

constituted by this Agreement or otherwise permitted by the terms of this
Agreement

 

15.                                         Assignment, transfer and lending
office

 

15.1                                  Benefit and burden

 

This Agreement
shall be binding upon, and enure for the benefit of, the Bank and the Borrowers
and their respective successors in title.

 

55

 

15.2                                  No assignment by Borrowers

 

None of the
Borrowers may assign or transfer any of its rights or obligations under this
Agreement.

 

15.3                                  Assignment by Bank

 

The Bank may
assign all or any part of its rights under this Agreement, the Master Swap
Agreement (notwithstanding the terms of Section 7 of the Master Swap Agreement)
or under any of the other Security Documents to any other bank or financial
institution (an “Assignee”) without the consent of
the Borrowers (the Borrowers consenting to any such assignment by their
execution of this Agreement).

 

15.4                                  Transfer

 

The Bank may
transfer all or any part of its rights, benefits and/or obligations under this
Agreement and/or any of the other Security Documents to any one or more banks
or other financial institutions (a “Transferee”)
without the consent of the Borrowers (the Borrowers consenting to
any such transfer by their execution of this Agreement) if the Transferee, by
delivery of such undertaking as the Bank may approve, becomes bound by the
terms of this Agreement and agrees to perform all or, as the case may be, part
of the Bank’s obligations under this Agreement.

 

15.5                                  Documenting assignments and
transfers

 

If the Bank
assigns all or any part of its rights or transfers all or any part of its
rights, benefits and/or obligations as provided in clauses 15.3 or 15.4, the
Borrowers jointly and severally undertake, immediately on being requested to do
so by the Bank and at the cost of the Bank, to enter into, and procure that the
other Security Parties shall enter into, such documents as may be necessary or
desirable to transfer to the Assignee or Transferee all or the relevant part of
the Bank’s interest in the Security Documents and all relevant references in
this Agreement to the Bank shall thereafter be construed as a reference to the
Bank and/or its Assignee or Transferee (as the case may be) to the extent of
their respective interests.

 

15.6                                  Lending office

 

The Bank shall
lend through its office at the address specified in this Agreement or through
any other office of the Bank selected from time to time by it through which the
Bank wishes to lend for the purposes of this Agreement. If the office through
which the Bank is lending is changed pursuant to this clause 15.6, the Bank
shall notify the Borrowers promptly of such change.

 

15.7                                  Disclosure of Information

 

The Bank may
disclose to a prospective assignee, transferee or to any other person who may
propose entering into contractual relations with the Bank in relation to this
Agreement such information about the Borrowers as the Bank shall consider
appropriate.

 

16.                                         Notices and other matters

 

16.1                                  Notices

 

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

 

16.1.1                          be in writing delivered
personally or by first-class prepaid letter (airmail if available) or facsimile
transmission or other means of telecommunication in permanent written form;

 

56

 

16.1.2                          be deemed to have been received,
subject as otherwise provided in the relevant Security Document, in the case of
a letter, when delivered personally or three (3) days after it has been put in
the post and, in the case of a facsimile transmission or other means of
telecommunication in permanent written form, upon receipt of confirmation that
the facsimile transmission has been received (provided that if the date receipt
is not a business day in the country of the addressee or if the time of receipt
is after the close of business in the country of the addressee it shall be
deemed to have been received at the opening of business on the next such
business day); and

 

16.1.3                          be sent

 

	
   

  	
  (a)

  	
  if to the Borrowers or any of them at:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  c/o Aegean Bunkering
  Services Inc. 42 Hatzikiriakou Street

  
	
   

  	
   

  	
  185 38
  Piraeus

  
	
   

  	
   

  	
  Greece

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Fax no:         +30
  210 458 6242

  
	
   

  	
   

  	
  Attention:     Mr.
  Apostolos Manitsas

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  if to the Bank at:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  The Royal
  Bank of Scotland plc

  
	
   

  	
   

  	
  Piraeus
  Branch

  
	
   

  	
   

  	
  45 Akti Miaouli

  
	
   

  	
   

  	
  185 36
  Piraeus

  
	
   

  	
   

  	
  Greece

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Fax No:         +30
  210 459 6600

  
	
   

  	
   

  	
  Attention:     Shipping
  Department

  

 

or to such
other address and/or numbers as is notified by one party to the other party
under this Agreement.

 

16.2                                  No implied waivers, remedies
cumulative

 

No failure or
delay on the part of the Bank to exercise any power, right or remedy under any
of the Security Documents shall operate as a waiver thereof, nor shall any
single or partial exercise by the Bank of any power, right or remedy preclude
any other or further exercise thereof or the exercise of any other power, right
or remedy. The remedies provided in the Security Documents are cumulative and
are not exclusive of any remedies provided by law.

 

16.3                                  English language

 

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

 

16.4                                  Borrowers’ obligations

 

16.4.1                          Joint and several

 

Notwithstanding
anything to the contrary contained in any of the Security Documents, the
agreements, obligations and liabilities of the Borrowers herein contained are
joint and several and shall be construed accordingly. Each of the Borrowers
agrees and consents to be bound by the Security Documents to which it is, or is
to be, a party notwithstanding that each of the other Borrowers which is
intended to sign or to be bound may not do so or be effectually bound and

 

57

 

notwithstanding
that any of the Security Documents may be invalid or unenforceable against the
other Borrowers or any of them, whether or not the deficiency is known to the
Bank.

 

16.4.2                          Borrowers as principal debtors

 

Each Borrower
acknowledges and confirms that it is a principal and original debtor in respect
of all amounts which may become payable by the Borrowers in accordance with the
terms of this Agreement or the Master Swap Agreement or any of the other
Security Documents and agrees that the Bank may also continue to treat it as
such, whether or not the Bank is or becomes aware that such Borrower is or has
become a surety for the other Borrowers or any of them.

 

16.4.3                          Indemnity

 

The Borrowers
hereby agree jointly and severally to keep the Bank fully indemnified on demand
against all damages, losses, costs and expenses (provided that, in the case of
such costs and expenses, they are reasonable and documented) arising from any
failure of any Borrower to perform or discharge any purported obligation or
liability of the other Borrowers or any of them which would have been the
subject of this Agreement or the Master Swap Agreement or any other Security
Document had it been valid and enforceable and which is not or ceases to be
valid and enforceable against a Borrower on any ground whatsoever, whether or
not known to the Bank (including, without limitation, any irregular exercise or
absence of any corporate power or lack of authority of, or breach of duty by,
any person purporting to act on behalf of a Borrower (or any legal or other
limitation, whether under the Limitation Acts or otherwise or any disability or
death, bankruptcy, unsoundness of mind, insolvency, liquidation, dissolution,
winding up, administration, receivership, amalgamation, reconstruction or any
other incapacity of any person whatsoever (including, in the case of a
partnership, a termination or change in the composition of the partnership) or
any change of name or style or constitution of any Security Party)).

 

16.4.4                          Liability unconditional

 

None of the
obligations or liabilities of any Borrower under this Agreement or the Master
Swap Agreement or any other Security Document shall be discharged or reduced by
reason of:

 

(a)                        the death, bankruptcy,
unsoundness of mind, insolvency, liquidation, dissolution, winding-up,
administration, receivership, amalgamation, reconstruction or other incapacity
of any person whatsoever (including, in the case of a partnership, a
termination or change in the composition of the partnership) or any change of
name or style or constitution of the other Borrowers or any of them or any
other person liable;

 

(b)                       the Bank granting any time,
indulgence or concession to, or compounding with, discharging, releasing or
varying the liability of, the other Borrowers or any of them or any other
person liable or renewing, determining, varying or increasing any
accommodation, facility or transaction or otherwise dealing with the same in
any manner whatsoever or concurring in, accepting, varying any compromise,
arrangement or settlement or omitting to claim or enforce payment from the
other Borrowers or any of them or any other person liable; or

 

(c)                        anything done or omitted which
but for this provision might operate to exonerate the Borrowers or any of them.

 

16.4.5                          Recourse to other security

 

The Bank shall
not be obliged to make any claim or demand or to resort to any Security
Document or other means of payment now or hereafter held by or available to it
for enforcing this Agreement or the Master Swap Agreement or any of the
Security Documents against a Borrower or any other person liable and no action
taken or omitted by the Bank in connection

 

58

 

with any such
Security Document or other means of payment will discharge, reduce, prejudice
or affect the liability of the Borrowers under this Agreement, the Master Swap
Agreement and the Security Documents to which any of them is, or is to be, a
party.

 

16.4.6                          Waiver of Borrowers’ rights

 

Each Borrower
agrees with the Bank that, from the date of this Agreement and so long as any
moneys are owing under any of the Security Documents and/or the Master Swap
Agreement and while all or any part of the Commitment remains outstanding, it
will not, without the prior written consent of the Bank:

 

(a)                        exercise any right of
subrogation, reimbursement and indemnity against the other

Borrowers or any of them or any other person liable under the Security
Documents;

 

(b)                       demand or accept repayment in
whole or in part of any Indebtedness now or hereafter due to such Borrower from
the other Borrowers or any of them or from any other person liable or demand or
accept any guarantee, indemnity or other assurance against financial loss or
any document or instrument created or evidencing an Encumbrance in respect of
the same or dispose of the same;

 

(c)                        take any steps to enforce any
right against the other Borrowers or any of them or any other person liable in
respect of any such moneys; or

 

(d)                       claim any set-off or
counterclaim against the other Borrowers or any of them or any other person
liable or claiming or proving in competition with the Bank in the liquidation
of the other Borrowers or any of them or any other person liable or have the
benefit of, or share in, any payment from or composition with, the other
Borrowers or any of them or any other person liable or any other Security
Document now or hereafter held by the Bank for any moneys owing under this
Agreement and/or the Master Swap Agreement or for the obligations or
liabilities of any other person liable but so that, if so directed by the Bank,
it will prove for the whole or any part of its claim in the liquidation of the
other Borrowers or any of them or other person liable on terms that the benefit
of such proof and all money received by it in respect thereof shall be held on
trust for the Bank and applied in or towards discharge of any moneys owing
under this Agreement and/or the Master Swap Agreement in such manner as the
Bank shall deem appropriate.

 

16.5                                  Maximum liability

 

16.5.1                            Each Borrower shall be entitled
to rights of contribution as against the other Borrowers or any of them,
however, such rights of contribution shall (a) not in any way (except as
otherwise expressly set forth in clause 16.5.2 below) condition or lessen the
liability of each Borrower as a joint and several borrower for the whole of the
obligations owed to the Bank hereunder, and under the Security Documents and
(b) shall be fully subject and subordinate to the rights of the Bank against
the Borrowers hereunder, and under the Security Documents.

 

16.5.2                            Notwithstanding anything to the
contrary contained in this Agreement, or any of the Security Documents, in the
event that any court or other judicial body of competent jurisdiction
determines that legal principles of fraudulent conveyances, fraudulent
transfers or similar concepts are applicable in evaluating the enforceability
against any particular Borrower or its assets of this Agreement or any Security
Document granted by such Borrower as security for its obligations hereunder and
that under such principles, this Agreement or such other Security Documents
would not be enforceable against such Borrower or its asset unless the
following provisions of this clause 16.5.2 had effect, then, the maximum
liability of such Borrower hereunder (the “Maximum
Liability Amount”) shall
be limited such that in no event shall such amount exceed the lesser of (i) the
obligations of such Borrower hereunder (in the principal amount of up to Thirty
seven million five hundred and sixty thousand Dollars ($37,560,000), plus
interest, expenses, fees and any amounts owing under the Master Swap
Agreement), and (ii)

 

59

 

an amount equal
to the aggregate, without double counting, of (a) ninety-five percent (95%) of
such Borrower’s Adjusted Net Worth (as hereinafter defined) on the date hereof,
on the date of commencement of a case under the Bankruptcy Code of the United
States of America, as amended (11 U.S.C. ss 101-1330) (the “Bankruptcy Code”) or any similar legislation in any other jurisdiction, in which
such Borrower is a debtor, or on the date enforcement of this Agreement is
sought (the “Determination Date”), whichever is greater, (b) the
aggregate fair value of such Borrowers Subrogation and Contribution Rights (as
hereinafter defined) and (c) the amount of any Valuable Transfer (as
hereinafter defined) to such Borrower; provided that each Borrowers liability
under this Agreement shall further be limited to the extent, if any, required
so that the obligations of each Borrower under this Agreement shall not be
subject to avoidance under Section 548 of the Bankruptcy Code or any similar
provision under the legislation of any other relevant jurisdiction, or to being
set aside or annulled under any applicable law relating to fraudulent transfers
or fraudulent conveyances. In determining the limitations, if any, on the
amount of any Borrowers obligations hereunder pursuant to the preceding
sentence, any rights of subrogation or contribution (collectively the “Subrogation and
Contribution Rights”) which
such Borrower may have on the Determination Date with respect to the Funding
Borrower (as hereinafter defined) under applicable law shall be taken into account.

 

16.5.3                            As used herein “Adjusted Net Worth”
of each Borrower shall mean, as of any date of determination thereof, an amount
equal to the lesser of (a) an amount equal to the excess of (i) the amount of
the present fair saleable value of the assets of such Borrower over (ii) the
amount that will be required to pay such Borrower’s probable liability on its
then existing debts, including contingent liabilities, as they become absolute
and matured, and (b) an amount equal to the excess of (i) the sum of such
Borrower’s property at a fair valuation over (ii) the amount of all liabilities
of such Borrower, contingent or otherwise, as such terms are construed in
accordance with applicable federal and state laws in the United States of
America, or the laws of other applicable jurisdictions, governing
determinations of the insolvency of debtors.

 

16.5.4                            In determining the Adjusted Net
Worth of each Borrower for purposes of calculating the Maximum Liability Amount
for such Borrower, the liabilities of such Borrower to be used in such
determination pursuant to each section Off of clause 17.6.3 shall in any event
exclude (a) the liabilities of such Borrower under this Agreement, (b) any
liabilities of such Borrower subordinated in right of payment to this Agreement
and (c) any liabilities of such Borrower for Subrogation and Contribution
Rights to the other Borrowers.

 

16.5.5                            As used herein “Valuable Transfer” shall mean, in respect of each Borrower,
(a) all loans, advances or capital contributions made to such Borrower with
proceeds of the Loan made under this Agreement, (b) all debt securities or
other obligations of such Borrower acquired from such Borrower or retired by
such Borrower with proceeds of the Loan made under this Agreement and
transferred, absolutely and not as collateral, to such Borrower (c) the fair
market value of all property acquired with proceeds of the Loan made under this
Agreement and transferred, absolutely and not as collateral, to such Borrower,
(d) all equity securities of such Borrower acquired from such Borrower with
proceeds of the Loan made under this Agreement and (e) the value of any other
economic benefits in accordance with applicable federal and statelaws, or the
laws of other applicable jurisdictions, governing determinations of the
insolvency of debtors, in each case accruing to such Borrower as a result of
the Loan made available under this Agreement.

 

16.5.6                            Without
in any way modifying or affecting the obligations of any of the Borrowers
hereunder, in the event any of the Borrowers shall make any payment or payments
to the Bank under this Agreement in an aggregate amount in excess of such
Borrower’s Percentage (such Borrower hereinafter called the “Funding Borrower” and each of the other Borrowers hereinafter called the “Other Borrower” and together the “Other Borrowers”), each
Other Borrower shall contribute to the Funding Borrower an amount equal to such
Other Borrower’s Percentage of such
payment or payments made by the Funding Borrower. For the purposes hereof, a
Funding Borrower’s or each Other Borrowers’ Percentage shall be determined as
of the date on which

 

60

 

such payment
was made by reference to the ratio of (a) such Funding Borrower’s or such Other
Borrowers’ Adjusted Net Worth as of such date to (b) the aggregate Adjusted Net
Worth of the Borrowers (including the Funding Borrower) as of such date.
Nothing in this paragraph shall affect each Borrowers’ several liability to the
Bank for the entire amount of the obligations of the Borrowers under this
Agreement (up to the limitations set forth in the preceding paragraph) or in
any other manner impair any right or remedy of the Bank hereunder. The
limitations provided above are intended solely to preserve the rights of the Bank
under this Agreement to the maximum extent permitted by applicable law and none
of the Borrowers nor any other person shall have any right hereunder that it
would not otherwise have under applicable law.

 

17.                                         Governing law and jurisdiction

 

17.1                                  Law

 

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

 

17.2                                  Submission to jurisdiction

 

Each Borrower
agrees, for the benefit of the Bank, that any legal action or proceedings
arising out of or in connection with this Agreement against the Borrowers or
any of them or any of their assets may be brought in the English courts. Each
Borrower irrevocably and unconditionally submits to the jurisdiction of such
courts and irrevocably designates, appoints and. empowers Riches
Consulting at present of Old Jarretts Farmhouse, Brantridge Lane, Balcombe,
West Sussex RH17 6JR, England to receive for it and on its behalf, service of
process issued out of the English courts in any such legal action or
proceedings. The submission to such jurisdiction shall not (and shall not be
construed so as to) limit the right of the Bank to take proceedings against the
Borrowers or any of them in the courts of any other competent jurisdiction nor
shall the taking of proceedings in any one or more jurisdictions preclude the
taking of proceedings in any other jurisdiction, whether concurrently or not.

 

The parties
further agree that only the Courts of England and not those of any other State
shall have jurisdiction to determine any claim which the Borrowers or any of
them may have against the Bank arising out of or in connection with this
Agreement.

 

17.3                                  Contracts (Rights of Third
Parties) Act 1999

 

No term of
this Agreement is enforceable under the provisions of the Contracts (Rights of
Third Parties) Act 1999 by a person who is not a party to this Agreement.

 

61

 

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

 

 

	
  SIGNED

  	
  )

  	
   

  	
   

  
	
  by  Y. Koumbiadou

  	
  )

  	
   

  	
   

  
	
  for and on behalf of

  	
  )

  	
  /s/ Y. Koumbiadou

  	
   

  
	
  ANDROS MARINE INC.

  	
  )

  	
  Attorney-in-fact

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNED

  	
  )

  	
   

  	
   

  
	
  by  Y.
  Koumbiadou

  	
  )

  	
   

  	
   

  
	
  for and on behalf of

  	
  )

  	
  /s/ Y. Koumbiadou

  	
   

  
	
  DILOS MARINE INC.

  	
  )

  	
  Attorney-in-fact

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNED

  	
  )

  	
   

  	
   

  
	
  by  Y.
  Koumbiadou

  	
  )

  	
   

  	
   

  
	
  for and on behalf of

  	
  )

  	
  /s/ Y. Koumbiadou

  	
   

  
	
  IOS MARINE INC.

  	
  )

  	
  Attorney-in-fact

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNED

  	
  )

  	
   

  	
   

  
	
  by  Y.
  Koumbiadou

  	
  )

  	
   

  	
   

  
	
  for and on behalf of

  	
  )

  	
  /s/ Y. Koumbiadou

  	
   

  
	
  SIFNOS MARINE INC.

  	
  )

  	
  Attorney-in-fact

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNED

  	
  )

  	
   

  	
   

  
	
  by  Y.
  Koumbiadou

  	
  )

  	
   

  	
   

  
	
  for and on behalf of

  	
  )

  	
  /s/ Y. Koumbiadou

  	
   

  
	
  TINOS MARINE INC.

  	
  )

  	
  Attorney-in-fact

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNED

  	
  )

  	
   

  	
   

  
	
  by  F. Bratimos

  	
  )

  	
   

  	
   

  
	
  for and on behalf of

  	
  )

  	
  /s/ F. Bratimos

  	
   

  
	
  THE ROYAL BANK OF SCOTLAND PLC

  	
  )

  	
  Attorney-in-fact

  	
   

  

 

62

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