Document:

Exhibit 10.6

 

Date 23 June 2008

 

THE
COMPANIES

listed in Schedule 1

as joint and several
Borrowers

 

- and -

 

THE BANKS
AND FINANCIAL INSTITUTIONS

listed in Schedule 2

as Lenders

 

- and -

 

FORTIS BANK
and 

BAYERISCHE HYPO-UND VEREINSBANK AG

as Co-Arrangers and Co-Underwriters

 

- and -

 

FORTIS BANK

as Agent and Security
Trustee

 

 

LOAN
AGREEMENT

 

relating to a facility of up
to US$111,600,000

to provide bridge financing for the construction of

nine (9) 158,460 dwt crude oil carrier newbuildings at

Hyundai Heavy Industries Co., Ltd., Korea

 

CONSTANT & CONSTANT

2, Defteras Merarchias

185 35 Piraeus

Greece

 

 

INDEX

 

	
  CLAUSE NO.

  	
   

  	
  PAGE NO.

  
	
   

  	
   

  	
   

  
	
  1

  	
  INTERPRETATION

  	
  1

  
	
  2

  	
  FACILITY

  	
  11

  
	
  3

  	
  POSITION OF THE LENDERS

  	
  12

  
	
  4

  	
  DRAWDOWN

  	
  13

  
	
  5

  	
  INTEREST

  	
  14

  
	
  6

  	
  INTEREST PERIODS

  	
  15

  
	
  7

  	
  DEFAULT INTEREST

  	
  16

  
	
  8

  	
  REPAYMENT AND
  PREPAYMENT

  	
  17

  
	
  9

  	
  CONDITIONS PRECEDENT

  	
  18

  
	
  10

  	
  REPRESENTATIONS AND
  WARRANTIES

  	
  19

  
	
  11

  	
  GENERAL UNDERTAKINGS

  	
  22

  
	
  12

  	
  CORPORATE UNDERTAKINGS

  	
  24

  
	
  13

  	
  PAYMENTS AND
  CALCULATIONS

  	
  25

  
	
  14

  	
  APPLICATION OF RECEIPTS

  	
  27

  
	
  15

  	
  EVENTS OF DEFAULT

  	
  27

  
	
  16

  	
  FEES AND EXPENSES

  	
  31

  
	
  17

  	
  INDEMNITIES

  	
  32

  
	
  18

  	
  NO SET-OFF OR TAX
  DEDUCTION

  	
  33

  
	
  19

  	
  ILLEGALITY, ETC

  	
  34

  
	
  20

  	
  INCREASED COSTS

  	
  35

  
	
  21

  	
  SET-OFF

  	
  36

  
	
  22

  	
  TRANSFERS AND CHANGES
  IN LENDING OFFICES

  	
  37

  
	
  23

  	
  VARIATIONS AND WAIVERS

  	
  40

  
	
  24

  	
  NOTICES

  	
  41

  
	
  25

  	
  JOINT AND SEVERAL
  LIABILITY

  	
  42

  
	
  26

  	
  SUPPLEMENTAL

  	
  43

  
	
  27

  	
  LAW AND JURISDICTION

  	
  43

  
	
  SCHEDULE
  1 BORROWERS

  	
  45

  
	
  SCHEDULE
  2 LENDERS AND COMMITMENTS

  	
  47

  
	
  SCHEDULE
  3 DRAWDOWN NOTICE

  	
  48

  
	
  SCHEDULE
  4 CONDITION PRECEDENT DOCUMENTS

  	
  49

  
	
  SCHEDULE
  5 TRANSFER CERTIFICATE

  	
  51

  
	
  EXECUTION
  PAGES

  	
  55

  
				

 

 

THIS LOAN AGREEMENT is made on 23 June 2008

 

BETWEEN:

 

(1)                     THE COMPANIES listed in Schedule 1 as joint and several Borrowers; and

 

(2)                     THE BANKS AND FINANCIAL INSTITUTIONS listed
in Schedule 2, as Lenders; and

 

(3)                     FORTIS BANK acting through its office at
166 Syngrou Avenue, 176 71 Athens, Greece and BAYERISCHE
HYPO-UND VEREINSBANK  AG
acting through its office at 7 Heraklitou Street, GR106 73, Athens, Greece, as Co-Arrangers; and

 

(4)                     FORTIS BANK acting through its office at
166 Syngrou Avenue, 176 71 Athens, Greece and BAYERISCHE
HYPO-UND VEREINSBANK AG acting through its office at 7 Heraklitou
Street, GR106 73, Athens, Greece, as Co-Underwriters;
and

 

(5)                     FORTIS BANK acting through its office at
166 Syngrou Avenue, 176 71 Athens, Greece, as Agent;
and

 

(6)                     FORTIS BANK acting through its office at
166 Syngrou Avenue, 176 71 Athens, Greece, as Security
Trustee.

 

WHEREAS

 

The
Lenders have agreed to make available to the Borrowers a facility of up to
US$111,600,000 in one advance, but not exceeding the lesser of (i) 67.245119%
of the amount of the First Instalments for each of the Ships and (ii) 13.449023%
of the amount of the Contract Price of each of the Ships, for the purpose of
providing bridge financing for part of the cost of the First Instalment of each
Ship due to the Builder under the Shipbuilding Contracts.

 

IT
IS AGREED as follows:

 

1                            INTERPRETATION

 

1.1                  Definitions. Subject to Clause
1.5, in this Agreement:

 

“Affected Lender” has the meaning given in
Clause 5.5;

 

“Agency and Trust Deed” means the agency and trust deed executed or
to be executed between the Borrowers, the Lenders, the Co-Arrangers, the
Co-Underwriters, the Agent and the Security Trustee, in such form as the
Co-Arrangers may approve or reasonably require;

 

“Agent” means Fortis Bank acting through its office
at 166 Syngrou Avenue, 176 71 Athens, Greece or any successor of it appointed
under clause 5 of the Agency and Trust Deed;

 

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

 

(a)                    15
July 2008 (or such later date as the Co-Arrangers may agree with the
Borrowers, which agreement shall not be unreasonably withheld); or

 

(b)                   if
earlier, the date on which the Total Commitments are fully borrowed, cancelled
or terminated;

 

 

“Borrowers” means each of the companies listed in
Schedule 1, each being a company incorporated and existing under the laws of
the Republic of The Marshall Islands and having its registered office at Trust
Company Complex, Ajeltake Road, Ajeltake Island, Majuro, The Marshall Islands
MH 96960, and includes their respective successors and in the singular means
any of them;

 

“Builder” means, Hyundai Heaving Industries Co., Ltd.,
a corporation organised and existing under the laws of the Republic of Korea
with its registered office at 1 Jeonha-Dong, Dong-Gu, Ulsan, Korea and includes
its successor;

 

“Business Day” means a day on which banks are open in
London, Athens, Brussels, Hamburg, Munich and (in relation to any payment to be
made to the Builder) Korea, and in respect of a day on which a payment is
required to be made under a Finance Document, also in New York City;

 

“Co-Arrangers” means each of Fortis Bank acting through its
office at 166 Syngrou Avenue, 176 71 Athens, Greece and Bayerische Hypo-und
Vereinsbank AG acting through its office at 7 Heraklitou Street, GR 106 73,
Athens, Greece;

 

“Co-Underwriters” means each of Fortis Bank acting through its
office at 166 Syngrou Avenue, 176 71 Athens, Greece and Bayerische Hypo-und
Vereinsbank AG acting through its office at 7 Heraklitou Street, GR 106 73,
Athens, Greece.

 

“Commitment” means, in relation to a Lender, the amount
set opposite such Lender’s name in Schedule 2, or, as the case may require, the
amount specified in the relevant Transfer Certificate or the amount of any
obligations assumed by a New Lender pursuant to Clause 3.4, as that amount may
be reduced, cancelled or terminated in accordance with this Agreement (and “Total Commitments” means the aggregate of
the Commitments of all the Lenders);

 

“Contract Price” means, in relation to a Ship, $92,200,000
being the amount payable by the relevant Borrower pursuant to the Shipbuilding
Contract relating to that Ship (as the same may be adjusted pursuant to the
terms of the Shipbuilding Contract);

 

“Contractual Currency” has the meaning given in Clause 17.5;

 

“Contribution” means, in relation to a Lender, the part of
the Loan which is owing to that Lender;

 

“Creditor Party” means the Agent, the Security Trustee or any
Lender, whether as at the date of this Agreement or at any later time;

 

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

 

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

 

“Drawdown Notice” means a notice in the form set out in
Schedule 3 (or in any other form which the Co-Arrangers approve);

 

“Event of Default” means any of the events or circumstances
described in Clause 15.1;

 

“Finance Documents” means:

 

(a)                    this
Agreement;

 

2

 

(b)                   the
Agency and Trust Deed;

 

(c)                    the
Predelivery Security Assignments; and

 

(d)                   any
other document (whether creating a Security Interest or not) which is executed
at any time by any of the Borrowers 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 Lenders under this Agreement or any of the documents
referred to in this definition (provided that, for the avoidance of doubt, the
Letters of Undertaking shall not constitute Finance Documents);

 

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

 

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

 

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

 

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

 

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

 

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

 

“First Instalment” means, in relation to a
Ship, the first instalment due by the relevant Borrower to the Builder under
the Shipbuiding Contract for that Ship, amounting to the lesser of (i) $18,440,000
and (ii) 20% of the Contract Price for that Ship;

 

“Holding Company” means Alma Maritime
Limited, a company incorporated and existing under the laws of the Republic of
The Marshall Islands and having its registered office at Trust Company Complex,
Ajeltake Road, Ajeltake Island, Majuro, The Marshall Islands MH 96960;

 

“Hull No. 2297” means the 158,460 dwt
crude oil carrier newbuilding with hull no. 2297 which is to be constructed by
the Builder for, and purchased by, Suez Turquoise Limited under the
Shipbuilding Contract relating to Hull No. 2297;

 

“Hull No. 2298” means the 158,460 dwt
crude oil carrier newbuilding with hull no. 2298 which is to be constructed by
the Builder for, and purchased by, Suez Amber Limited under the Shipbuilding
Contract relating to Hull No. 2298;

 

“Hull No. 2299” means the 158,460 dwt
crude oil carrier newbuilding with hull no. 2299 which is to be constructed by
the Builder for, and purchased by, Suez Crystal Limited under the Shipbuilding
Contract relating to Hull No. 2299;

 

“Hull No. 2300” means the 158,460 dwt
crude oil carrier newbuilding with hull no. 2300 which is to be constructed by
the Builder for, and purchased by, Suez Topaz Limited under the Shipbuilding
Contract relating to Hull No. 2300;

 

3

 

“Hull No. 2301” means the 158,460 dwt
crude oil carrier newbuilding with hull no. 2301 which is to be constructed by
the Builder for, and purchased by, Suez Diamond Limited under the Shipbuilding
Contract relating to Hull No. 2301;

 

“Hull No. 2302” means the 158,460 dwt
crude oil carrier newbuilding with hull no. 2302 which is to be constructed by
the Builder for, and purchased by, Suez Jade Limited under the Shipbuilding
Contract relating to Hull No. 2302;

 

“Hull No. 2303” means the 158,460 dwt
crude oil carrier newbuilding with hull no. 2303 which is to be constructed by
the Builder for, and purchased by, Suez Pearl Limited under the Shipbuilding
Contract relating to Hull No. 2303;

 

“Hull No. 2304” means the 158,460 dwt
crude oil carrier newbuilding with hull no. 2304 which is to be constructed by
the Builder for, and purchased by, Suez Emerald Limited under the Shipbuilding
Contract relating to Hull No. 2304;

 

“Hull No. 2305” means the 158,460 dwt
crude oil carrier newbuilding with hull no. 2305 which is to be constructed by
the Builder for, and purchased by, Suez Ruby Limited under the Shipbuilding
Contract relating to Hull No. 2305;

 

“Interest Period” means, in relation to the
Loan, a period determined in accordance with Clause 6;

 

“Lender” means, subject to Clause 22.6:

 

(a)                    a
bank or financial institution listed in Schedule 2 and acting through its
branch indicated in Schedule 2 (or through another branch notified to the
Borrower under Clause 22.14) unless it has delivered a Transfer Certificate or
Transfer Certificates covering the entire amounts of its Commitment and its
Contribution; and

 

(b)                   the
holder for the time being of a Transfer Certificate;

 

“Letters of Undertaking” means each of the letters to be executed in
favour of the Co-Arrangers by the Shareholders undertaking (inter alia)
commitment of their equity participation throughout the construction period of
each of the Ships (including, for the avoidance of doubt, their equity
participation in the delivery instalment for each Ship and any additional costs
and expenses related to the construction of the Ships in excess of the Contract
Price of each Ship), in a form and substance satisfactory to the Co-Arrangers
in their sole and absolute discretion;

 

“LIBOR” means, for an Interest Period:

 

(a)                    the
rate per annum equal to the offered quotation for deposits in Dollars for a
period equal to, or as near as possible equal to, the relevant Interest Period
which appears on REUTERS BBA Page LIBOR 1 at or about 11.00 a.m.
(London time) on the Quotation Date prior to the commencement of that Interest
Period (and, for the purposes of this Agreement, “REUTERS BBA Page LIBOR
1” means the display designated as “REUTERS BBA Page LIBOR 1” on the
Reuters Money News Service or such other page as may replace REUTERS BBA Page LIBOR
1 on that service for the purpose of displaying rates comparable to that rate)
or on such other service as may be nominated by the British Bankers’
Association as the information vendor for the purpose of displaying the British
Bankers’ Association Interest Settlement Rates for Dollars; or

 

4

 

(b)                   if
no rate is quoted on REUTERS BBA Page LIBOR 1, the rate per annum
determined by the Agent to be the arithmetic mean of the rates per annum
determined by the Agent as the rate at which deposits in Dollars are offered to
the Agent by leading banks in the London Interbank Market at the Agent’s request
at or about 11.00 a.m. (London time) on the Quotation Date for that
Interest Period for a period equal to that Interest Period and for delivery on
the first Business Day of it;

 

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

 

“Margin” means one point six zero percent
(1.60%) per annum;

 

“Negotiation Period” has the meaning given
in Clause 5.8;

 

“Notifying Lender” has the meaning given in
Clause 20.1 or Clause 21.1 as the context requires;

 

“Owner” means, in relation to a Ship, the
Borrower which is or will be the owner of that Ship, and being a wholly owned
subsidiary of the Holding Company;

 

“Payment Currency” has the meaning given in
Clause 17.5;

 

“Permitted Security Interests” means:

 

(a)                    Security
Interests created by the Finance Documents;

 

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

 

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

 

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

 

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

 

(b)                   a
country in which the company’s central management and control is or has
recently been exercised;

 

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

 

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

 

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

 

5

 

“Predelivery Security Assignment” means, in
relation to a Ship, an assignment of the Shipbuilding Contract and the Refund
Guarantee relating to that Ship, to be executed by the relevant Borrower in
favour of the Security Trustee, in such form as the Co-Arrangers may approve or
reasonably require;

 

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

 

“Refund Guarantee” means:

 

(a)                    in
relation to Hull No. 2297, the irrevocable and unconditional guarantee
number M0902-806-LG-00018 dated 5 June 2008 issued by the Refund Guarantor
in favour of the relevant Borrower pursuant to the Shipbuilding Contract for
that Ship;

 

(b)                   in
relation to Hull No. 2298, the irrevocable and unconditional guarantee
number M0902-806-LG-00025 dated 5 June 2008 issued by the Refund Guarantor
in favour of the relevant Borrower pursuant to the Shipbuilding Contract for
that Ship;

 

(c)                    in
relation to Hull No. 2299, the irrevocable and unconditional guarantee
number M0902-806-LG-00032 dated 5 June 2008 issued by the Refund Guarantor
in favour of the relevant Borrower pursuant to the Shipbuilding Contract for
that Ship;

 

(d)                   in
relation to Hull No. 2300, the irrevocable and unconditional guarantee
number M0902-806-LG-00040 dated 5 June 2008 issued by the Refund Guarantor
in favour of the relevant Borrower pursuant to the Shipbuilding Contract for
that Ship;

 

(e)                    in
relation to Hull No. 2301, the irrevocable and unconditional guarantee
number M0902-806-LG-00057 dated 5 June 2008 issued by the Refund Guarantor
in favour of the relevant Borrower pursuant to the Shipbuilding Contract for
that Ship;

 

(f)                      in
relation to Hull No. 2302, the irrevocable and unconditional guarantee
number M0902-806-LG-00064 dated 5 June 2008 issued by the Refund Guarantor
in favour of the relevant Borrower pursuant to the Shipbuilding Contract for
that Ship;

 

(g)                   in
relation to Hull No. 2303, the irrevocable and unconditional guarantee
number M0902-806-LG-00071 dated 5 June 2008 issued by the Refund Guarantor
in favour of the relevant Borrower pursuant to the Shipbuilding Contract for
that Ship;

 

(h)                   in
relation to Hull No. 2304, the irrevocable and unconditional guarantee
number M0902-806-LG-00089 dated 5 June 2008 issued by the Refund Guarantor
in favour of the relevant Borrower pursuant to the Shipbuilding Contract for
that Ship;

 

(i)                       in
relation to Hull No. 2305, the irrevocable and unconditional guarantee
number M0902-806-LG-00096 dated 5 June 2008 issued by the Refund Guarantor
in favour of the relevant Borrower pursuant to the Shipbuilding Contract for
that Ship;

 

6

 

“Refund Guarantor” means The Export-Import
Bank of Korea, with its registered office at 16-1, Yoido-Dong, Yeongdeungpo-Gu,
Seoul 150-996, Korea and including its successor;

 

“Relevant Person” has the meaning given in
Clause 15.9;

 

“Repayment Date” means the earlier of (i) the
date falling six months from the Drawdown Date, (ii) 15 January 2009
and (iii) the date falling one (1) week before 26 November 2008
or such other date as the relevant Owner and the Builder may agree, being the
due date for the payment of the second instalment under each Shipbuilding
Contract;

 

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

 

“Security Interest” means:

 

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

 

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

 

“Security Party” means any person (except a
Creditor Party) who, as a surety or mortgagor, as a party to any subordination
or priorities arrangement, or in any similar capacity, executes a document
falling within paragraph (d) of the definition of “Finance Documents”
(provided that, for the avoidance of doubt, the Shareholders shall not
constitute a Security Party by their execution of the Letters of Undertaking);

 

“Security Period” means the period
commencing on the date of this Agreement and ending on the date on which the
Agent notifies the Borrowers, the Security Parties and the Lenders that:

 

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

 

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

 

(c)                    no
Borrower nor any Security Party has any future or contingent liability under
Clause 16, 17 or 18 below or any other provision of this Agreement or another
Finance Document;

 

“Security Trustee” means Fortis Bank of 166
Syngrou Avenue, 176 71 Athens, Greece or any successor of it appointed under
clause 5 of the Agency and Trust Deed;

 

“Shareholders” means such individual
persons as have been disclosed to and agreed by the Co-Arrangers prior to the
date of this Agreement and who beneficially own 100% of the shares in the
Holding Company, in the percentages disclosed to and

 

7

 

agreed
by the Co-Arrangers prior to the date of signing of this Agreement, and
includes their respective successors;

 

“Ships” means Hull No. 2297, Hull No. 2298,
Hull No. 2299, Hull No. 2300, Hull No. 2301, Hull No. 2302,
Hull No. 2303, Hull No. 2304 and Hull No. 2305, and in the
singular means any of them;

 

“Shipbuilding Contract” means:

 

(a)                    in
relation to Hull No. 2297, the shipbuilding contract dated 2 June 2008
made between the Builder and the relevant Borrower for the construction by the
Builder of Hull No. 2297 and its purchase by the relevant Borrower (as
supplemented and/or amended from time to time);

 

(b)                   in
relation to Hull No. 2298, the shipbuilding contract dated 2 June 2008
made between the Builder and the relevant Borrower for the construction by the
Builder of Hull No. 2298 and its purchase by the relevant Borrower (as
supplemented and/or amended from time to time);

 

(c)                    in
relation to Hull No. 2299, the shipbuilding contract dated 2 June 2008
made between the Builder and the relevant Borrower for the construction by the
Builder of Hull No. 2299 and its purchase by the relevant Borrower (as
supplemented and/or amended from time to time);

 

(d)                   in
relation to Hull No. 2300, the shipbuilding contract dated 2 June 2008
made between the Builder and the relevant Borrower for the construction by the
Builder of Hull No. 2300 and its purchase by the relevant Borrower (as
supplemented and/or amended from time to time);

 

(e)                    in
relation to Hull No. 2301, the shipbuilding contract dated 2 June 2008
made between the Builder and the relevant Borrower for the construction by the
Builder of Hull No. 2301 and its purchase by the relevant Borrower (as
supplemented and/or amended from time to time);

 

(f)                      in
relation to Hull No. 2302, the shipbuilding contract dated 2 June 2008
made between the Builder and the relevant Borrower for the construction by the
Builder of Hull No. 2302 and its purchase by the relevant Borrower (as
supplemented and/or amended from time to time);

 

(g)                   in
relation to Hull No. 2303, the shipbuilding contract dated 2 June 2008
made between the Builder and the relevant Borrower for the construction by the
Builder of Hull No. 2303 and its purchase by the relevant Borrower (as
supplemented and/or amended from time to time);

 

(h)                   in
relation to Hull No. 2304, the shipbuilding contract dated 2 June 2008
made between the Builder and the relevant Borrower for the construction by the
Builder of Hull No. 2304 and its purchase by the relevant Borrower (as
supplemented and/or amended from time to time);

 

(i)                       in
relation to Hull No. 2305, the shipbuilding contract dated 2 June 2008
made between the Builder and the relevant Borrower for the construction by the
Builder of Hull No. 2305 and its purchase by the relevant Borrower (as
supplemented and/or amended from time to time);

 

“Total Loss” means, in relation to a Ship:

 

(a)                    the
actual, constructive, compromised, agreed or arranged total loss of that Ship;

 

8

 

(b)                   any
expropriation, confiscation, requisition or acquisition of that Ship, whether
for full consideration, a consideration less than her proper value, a nominal
consideration or without any consideration, which is effected by any government
or official authority or by any person or persons claiming to be or to
represent a government or official authority, excluding a requisition for hire;

 

(c)                    any
condemnation of that Ship by any tribunal or by any person or person claiming
to be a tribunal;

 

(d)                   any
arrest, capture, seizure or detention of the Ship (including any hijacking or
theft) unless she is within 45 days redelivered to the full control of the
Builder or, as the case may be, the Borrower owning that Ship;

 

“Total Loss Date” means, in relation to a
Ship:

 

(a)                   in
the case of an actual total loss of that Ship, the date on which it occurred
or, if that is unknown, ten (10) days after the date when that Ship was
last heard of;

 

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

 

(i)                        the
date on which a notice of abandonment is given to the insurers (provided that a
claim for total loss is admitted by such insurers) or if such insurers do not
forthwith admit such a claim, at the date and at the time at which either a
total loss is subsequently admitted by the insurers or a total loss is
subsequently adjudged by a competent court of law or arbitration tribunal to
have occurred; and

 

(ii)                     the
date of any compromise, arrangement or agreement made by or on behalf of the
Borrower which owns that Ship, with that Ship’s insurers in which the insurers
agree to treat that Ship as a total loss; and

 

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

 

“Transfer Certificate” has the meaning
given in Clause 22.2;

 

“Trust Property” has the meaning given in
clause 3.1 of the Agency and Trust Deed.

 

1.2                  Construction
of certain terms. In this Agreement:

 

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

 

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

 

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

 

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

 

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

 

9

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

“regulation” includes any regulation, rule,
official directive, request or guideline (either having the force of law or
with which the party concerned habitually complies and, in such case,
compliance with which is reasonable in the ordinary course of business of the
party concerned) of any governmental, intergovernmental or supranational body,
agency, department or regulatory, self-regulatory or other authority or
organisation;

 

“subsidiary” has the meaning given in
Clause 1.4;

 

“successor” includes any person who is
entitled (by assignment, novation, merger or otherwise) to any other person’s
rights under this Agreement or any other Finance Document (or any interest in
those rights) or who, as administrator, liquidator or otherwise, is entitled to
exercise those rights; and in particular references to a successor include a
person to whom those rights (or any interest in those rights) are transferred
or pass as a result of a merger, division, reconstruction or other reorganisation
of it or any other person; and

 

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

 

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

 

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

 

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

 

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

 

10

 

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

 

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

 

(b)                    P
has direct or indirect control over a majority of the voting rights attached to
the issued shares of S; or

 

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

 

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

 

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

 

1.5                  General
Interpretation.

 

(a)                    In
this Agreement:

 

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

 

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

 

(iii)                 words
denoting the singular number shall include the plural and vice versa.

 

(b)                    Clauses
1.1 to 1.4 and paragraph (a) of this Clause 1.5 apply unless the contrary
intention appears.

 

(c)                     References
in Clause 1.1 to a document being in the form of a particular Appendix include
references to that form with any modifications to that form which the Agent
(with the authorisation of the Lenders in the case of substantial modifications)
approves or reasonably requires.

 

(d)                    The
clause headings shall not affect the interpretation of this Agreement.

 

2                            FACILITY

 

2.1                  Amount
of facility. Subject to the other provisions of this Agreement, the Lenders
shall make available to the Borrowers a loan facility in one advance not
exceeding the lesser of (a) $111,600,000, (b) 67.245119% of the
amount of the First Instalment for each of the Ships and (c) 13.449023% of
the amount of the Contract Price of each of the Ships.

 

2.2                  Lenders’
participations in Loan. Subject to the other provisions of this Agreement,
each Lender shall participate in the Loan in the proportion which, as at the
Drawdown Date, its Commitment bears to the Total Commitments.

 

2.3                  Purpose
of Loan. Each of the Borrowers (other than the Holding Company, which will
on-lend to the Owners any part of the Loan it receives) undertakes with each
Creditor Party to use the Loan only for the purpose stated in the preamble to
this Agreement.

 

11

 

2.4                  Cancellation
of Commitment. The Borrowers may at any time request (in writing addressed
to the Agent) the reduction of all or any part of the Total Commitments,
whereupon such cancelled part shall cease to be available, and the Commitment
of each Lender shall be reduced pro rata, provided that such cancellation shall
be irrevocable and at no cost to the Borrowers.

 

3                            POSITION
OF THE LENDERS

 

3.1                  Interests
of Lenders several. The rights of the Lenders under this Agreement are
several; accordingly each Lender shall be entitled to sue for any amount which
has become due and payable by the Borrowers to it under this Agreement without
joining the Agent, the Security Trustee or any other Lender as additional
parties in the proceedings save that enforcement proceedings can only be
commenced in accordance with the Agency and Trust Deed and not otherwise.

 

3.2                  Proceedings
by individual Lender. However, without the prior consent of the
Co-Arrangers, no Lender may bring proceedings in respect of:

 

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

 

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

 

3.3                  Obligations
of Lenders several. The obligations of the Lenders under this Agreement are
several; and a failure of a Lender to perform its obligations under this
Agreement shall not result in:

 

(a)                    the
obligations of the other Lenders being increased; nor

 

(b)                    any
Borrower, any Security Party or any other Lender being discharged (in whole or
in part) from its obligations under any Finance Document,

 

and in
no circumstances shall a Lender have any responsibility for a failure of
another Lender to perform its obligations under this Agreement.

 

3.4                  Failure
to contribute. If any Lender shall fail to contribute to the Loan on the
Drawdown Date, the Borrowers may, without prejudice to any other rights they
may have against such Lender, within 10 Banking Days of the Drawdown Date (but
only if such failure is then continuing) by notice to the Agent cancel the
undrawn amount of such Lender’s Commitment whereupon the undrawn amount of the
total of the Commitments of all the Lenders shall be reduced by the undrawn
amount of that Lender’s Commitment and the Agent shall, if so requested by the
Borrowers, attempt during a period not exceeding 30 days after receipt of such
notice to find another bank or financial institution acceptable to the
Borrowers (the “New  Lender”)  to
assume the cancelled obligations of such Lender (the “Old Lender”)  under
this Agreement. If the New Lender agrees in writing with the Borrowers, the
Co-Arrangers, the Co-Underwriters and the Agent to assume the cancelled
obligations of the Old Lender under this Agreement (or any part thereof), then
the total of the Commitments of all the Lenders under this Agreement shall be
increased accordingly.

 

3.5                  Parties
bound by certain actions of Lenders. Every Lender, each Borrower and each
Security Party shall be bound by:

 

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

 

12

 

(b)                    any
instruction or authorisation given by the Lenders to the Agent or the Security
Trustee under or in connection with any Finance Document;

 

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

 

3.6                  Reliance
on action of Agent. However, each of the Borrowers and each Security Party:

 

(a)                    shall
be entitled to assume that the Lenders have duly given any instruction or
authorisation which, under any provision of a Finance Document, is required in
relation to any action which the Agent 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.

 

3.7                  Construction.
In  Clauses 3.5 and 3.6
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.

 

4                            DRAWDOWN

 

4.1                  Request
for Loan. Subject to the following conditions, the Borrowers may request
the Loan to be made by ensuring that the Agent receives a completed Drawdown
Notice not later than 11.00 a.m. (Athens time) 2 Business Days prior to
the intended Drawdown Date.

 

4.2                  Availability.
The conditions referred to in Clause 4.1 are that:

 

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

 

(b)                    the
amount of the Loan shall not exceed the lesser of (i) $111,600,000, (ii) 67.245119%
of the amount of the First Instalment of each of the Ships and (iii) 13.449023%
of the amount of the Contract Price of each of the Ships; and

 

(c)                     the
Borrowers have complied with the provisions of Clause 9.1 and 9.2.

 

4.3                  Notification
to Lenders of receipt of the Drawdown Notice. The Agent shall promptly
notify the Lenders that it has received the Drawdown Notice and shall inform
each Lender of:

 

(a)                    the
amount of the Loan and the Drawdown Date;

 

(b)                    the
amount of that Lender’s participation in the Loan; and

 

(c)                     the
duration of the first Interest Period.

 

4.4                  Drawdown
Notice irrevocable. A Drawdown Notice must be signed by a director or other
authorised person of each of the Borrowers; and once served, a Drawdown Notice
cannot be revoked without the prior consent of the Agent, acting on the
authority of the Lenders (such consent not to be unreasonably withheld or
delayed), provided always that the Agent has received promptly and correctly
any cancellation request made pursuant to Clause 2.4.

 

4.5                  Lenders
to make available Contributions. Subject to the provisions of this
Agreement, each Lender shall, on and with value on the Drawdown Date, make
available to the Agent for the account of the Borrowers the amount due from
that Lender on the Drawdown Date under Clause 2.2.

 

13

 

4.6                  Disbursement
of Loan. Subject to the provisions of this Agreement, the Agent shall on
the Drawdown Date pay to the Borrowers the amounts which the Agent receives
from the Lenders under Clause 4.5; and that payment to the Borrowers shall be
made:

 

(a)                    to
the account which the Borrowers specify in the Drawdown Notice; and

 

(b)                    in
the like funds as the Agent received the payments from the Lenders.

 

4.7                  Disbursement
of Loan to third party. The payment by the Agent under Clause 4.6 to the
Builder or the Borrowers (as the case may be) shall constitute the making of
the Loan and the Borrowers shall thereupon become indebted, as principal and direct
obligor, to each Lender in an amount equal to that Lender’s Contribution.

 

5                            INTEREST

 

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

 

5.2                  Normal
rate of interest. Subject to the provisions of this Agreement, the rate of
interest on the Loan in respect of an Interest Period shall be the aggregate of
the Margin and LIBOR for that Interest Period. Provided always that should the
Borrowers request, and should the Lenders agree to, an Interest Period greater
than 12 months, then the rate of interest shall be determined by the Agent by
reference to the Lenders’ cost of funds.

 

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

 

5.4                  Notification
of Interest Periods and rates of normal interest. The Agent shall notify
the Borrowers and each Lender of:

 

(a)                    each
rate of interest; and

 

(b)                    the
duration of each Interest Period;

 

as
soon as reasonably practicable after each is determined, but (in the case of (a) above)
not later than one Business Day prior to the first day of the Interest Period
and (in the case of (b) above) not later than two Business Days prior to
the first day of the Interest Period provided always that the Agent has been so
notified by the Borrowers pursuant to Clause 6.2.

 

5.5                  Market
disruption. The following provisions of this Clause 5 apply if:

 

(a)                    at
least two Business Days before the start of an Interest Period, Lenders having
Contributions together amounting to more than forty per cent. of the Loan (or,
if the Loan has not been made, Commitments amounting to more than forty per
cent. of the Total Commitments) notify the Agent that LIBOR fixed by the Agent
would not accurately reflect the cost to those Lenders of funding their
respective Contributions (or any part of them) during the relevant Interest
Period in the London Interbank Dollar Market at or about 11.00 a.m.
(London time) on the second Business Day before the commencement of the
relevant Interest Period; or

 

(b)                    at
least two Business Days before the start of an Interest Period, the Agent is
notified by a Lender (the “Affected Lender”) that
for any reason of circumstances affecting the London Interbank Market in
Dollars generally it is unable to obtain

 

14

 

Dollars
in the London Interbank Market in order to fund its Contribution (or any part
of it) during the Interest Period.

 

5.6                  Notification
of market disruption. The Agent shall promptly notify the Borrowers and
each of the Lenders stating the circumstances falling within Clause 5.5 which
have caused its notice to be given.

 

5.7                  Suspension
of drawdown. If the Agent’s notice under Clause 5.6 is served before the
Loan is made:

 

(a)                    in
a case falling within paragraph (a) of Clause 5.5, the Lenders’
obligations to make the Loan;

 

(b)                    in
a case falling within paragraph (b) of Clause 5.5, the Affected Lender’s
obligation to participate in the Loan;

 

shall
be suspended while the circumstances referred to in the Agent’s notice
continue.

 

5.8                  Negotiation
of alternative rate of interest. If the Agent’s notice under Clause 5.6 is
served after the Loan is made, the Borrowers, the Agent and the Lenders or (as
the case may be) the Affected Lender shall use reasonable endeavours to agree
in writing, within the 30 days after the date on which the Agent serves its
notice under Clause 5.6 (the “Negotiation
Period”), an alternative interest rate or (as the case may be) an
alternative basis for the Lenders or (as the case may be) the Affected Lender
to fund or continue to fund their or its Contribution to the Loan during the
Interest Period concerned (the “Substitute
Basis”).

 

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

 

5.10           Alternative
rate of interest in absence of agreement. If a Substitute Basis is not
agreed within the Negotiation Period, and the relevant circumstances are
continuing at the end of the Negotiation Period, then the Borrowers shall
within 5 days after the end of the Negotiation Period prepay the Loan together
with accrued interest thereon payable to each Lender at the rate certified by
each such Lender and notified through the Agent to the Borrowers as being a
reasonable interest reflecting the cost to such Lender of funding its
Contribution during the period ending on the date of such prepayment, plus the
Margin.

 

So
long as any Substitute Basis is in force, the Agent shall from time to time
(but at least monthly) and in consultation with the Lenders review whether or
not the circumstances are such that such Substitute Basis is no longer
necessary and, if the Agent so determines, it shall notify the Borrowers and
the Lenders that the Substitute Basis shall cease to be effective from such
date as the Agent shall reasonably specify.

 

5.11           Application
of prepayment. The provisions of Clause 8 shall apply in relation to the
prepayment.

 

6                            INTEREST
PERIODS

 

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

 

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

 

15

 

(a)                    1,
3, 6, 9 or 12 months as notified by the Borrowers to the Agent not later than
11.00 a.m. (Athens time) 2 Business Days before the commencement of the
Interest Period, provided that the Borrowers shall only be permitted to select
up to three 1-month Interest Periods in any one calendar year; or

 

(b)                    three
months, if the Borrowers fail to notify the Agent by the time specified in
paragraph (a) above; or

 

(c)                     such
other period as the Co-Arrangers may agree with the Borrowers.

 

6.3                  Duration
of Interest Periods for repayment instalments. In respect of an amount due
to be repaid under Clause 8 on the Repayment Date, an Interest Period shall end
on that Repayment Date.

 

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

 

7                            DEFAULT INTEREST

 

7.1                  Payment
of default interest on overdue amounts. The Borrowers shall pay interest in
accordance with the following provisions of this Clause 7 on any amount payable
by the Borrowers under any Finance Document which the Agent, the Security
Trustee or the other designated payee does not receive on or before the
relevant date, that is:

 

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

 

(b)                    if
a Finance Document provides that such amount is payable on demand, the date
falling three (3) days after the date on which the relevant demand is
served; or

 

(c)                     if
such amount has become immediately due and payable under Clause 16.4, the date
on which it became immediately due and payable.

 

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

 

(a)                    in
the case of an overdue amount of principal, the higher of the rates set out at
paragraphs (a) and (b) of Clause 7.3; or

 

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

 

7.3                  Calculation
of default rate of interest. The rates referred to in Clause 7.2 are:

 

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

 

(b)                    the
Margin plus, in respect of successive periods of any duration (including at
call) up to 3 months which the Agent may select from time to time (having
regard to the interests of the Borrowers to reduce the amount of default
interest accruing or to accrue):

 

16

 

(i)                       LIBOR;
or

 

(ii)                    if
the Agent determines that Dollar deposits for any such period in an amount
equal to the overdue amount are not being made available to the Lenders by
leading banks in the London Interbank Market in the ordinary course of business
for reasons affecting the London Interbank Market in Dollars generally, the
higher of the rates from time to time determined by the Agent by reference to
the cost of funds to each Lender from such other source as each Lender may from
time to time reasonably determine.

 

7.4                  Notification
of interest periods and default rates. The Agent shall promptly notify the
Lenders and the Borrowers of each interest rate determined by the Agent under
Clause 7.3 and of each period selected by the Agent for the purposes of
paragraph (b) of that Clause; but this shall not be taken to imply that
the Borrowers are liable to pay such interest only with effect from the date of
the Agent’s notification.

 

7.5                  Payment
of accrued default interest. Subject to the other provisions of this Agreement,
any interest due under this Clause shall be paid on the last day of the period
by reference to which it was determined; and the payment shall be made to the
Agent for the account of the Creditor Party to which the overdue amount is due.

 

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

 

8                            REPAYMENT AND PREPAYMENT

 

8.1                  Repayment
Date. On the Repayment Date, the Borrowers shall repay the Loan in full,
and shall additionally pay to the Agent for the account of the Creditor Parties
all other sums then accrued or owing under any Finance Document.

 

8.2                  Voluntary
prepayment. Subject to the following conditions, the Borrowers may prepay
the whole or part of the Loan on the last day of an Interest Period in respect
thereof.

 

8.3                  Conditions
for voluntary prepayment. The conditions referred to in Clause 8.2 are
that:

 

(a)                    a
partial prepayment shall be in the minimum amount of Five hundred thousand
Dollars ($500,000) or a multiple thereof;

 

(b)                    the
Agent has received from the Borrowers at least 3 days prior written notice
specifying the amount to be prepaid and the date on which the prepayment is to
be made;

 

(c)                     the
Borrowers have provided evidence satisfactory to the Agent that any consent
required by any of the Borrowers or any Security Party for effecting the
prepayment has been obtained and remains in force.

 

8.4                  Additional
voluntary prepayment. The Borrowers may also prepay (in whole but not in
part only), without premium or penalty, but without prejudice to their
obligations under Clauses 5.5, 18.2 and 20.1:

 

(a)                    the
Contribution of any Lender to which the Borrowers shall have become obliged to
pay additional amounts under Clauses 18.2 or 20.1; or

 

(b)                    any
Lender’s Contribution to which a Substitute Basis applies by virtue of Clause
5.5.

 

17

 

Upon
any notice of such prepayment being given, the Commitment of the relevant
Lender shall be reduced to zero.

 

8.5                  Effect
of notice of prepayment. A prepayment notice may not be withdrawn or
amended without the consent of the Co-Arrangers (such consent not to be
unreasonably withheld or delayed), and the amount specified in the prepayment
notice shall become due and payable by the Borrowers on the date for prepayment
specified in the prepayment notice.

 

8.6                  Notification
of notice of prepayment. The Agent shall notify the Lenders promptly upon
receiving a prepayment notice, and shall provide any Lender which so requests
with a copy of any document delivered by the Borrowers under Clause 8.3(c).

 

8.7                  Mandatory
prepayment. The Borrowers shall be obliged to prepay the Relevant Amount of
the Loan:

 

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

 

(b)                    if
a Ship becomes a Total Loss, on the date falling 90 days after the Total Loss
Date;

 

(c)                     if
any of the following occurs, on demand by the Agent:

 

(i)                       a
Shipbuilding Contract or a Refund Guarantee is cancelled, terminated, rescinded
or suspended or otherwise ceases to remain in force for any reason; or

 

(ii)                    a
Shipbuilding Contract or a Refund Guarantee is materially amended or varied
without the prior written consent of the Lenders except for any such amendment
or variation as is permitted by this Agreement or any other relevant Finance
Document.

 

In
this Clause 8.7, “Relevant Amount” means
the amount of the Loan which is equal to the amount of the First Instalment
funded by the Lenders under this Agreement and which relates to the Ship sold
or lost or which is the subject of the Shipbuilding Contract or Refund
Guarantee in question (as the case may be) (being not more than l/9th of the amount of the Loan drawn down by the
Borrowers on the Drawdown Date).

 

Provided
always that the Co-Arrangers agree to consider (without being obliged to do so)
a request by the Borrowers to waive the provisions of Clause 8.7(b) upon
the circumstances existing at the time.

 

8.8                  Amounts
payable on prepayment. A prepayment shall be made together with accrued
interest (and any other amount payable under Clause 17 below or otherwise) in
respect of the amount prepaid and, if the prepayment is not made on the last
day of an Interest Period, together with any sums payable under Clause 17.1(b) but
without premium or penalty.

 

8.9                  No
reborrowing. No amount prepaid or repaid may be reborrowed.

 

9                            CONDITIONS
PRECEDENT

 

9.1                  Documents,
fees and no default. Each Lender’s obligation to contribute to the Loan is
subject to the following conditions precedent:

 

18

 

(a)                     that, on or
before the date of signing of this Agreement, the Agent receives the documents
described in Part A of Schedule 3 in form and substance satisfactory to
the Co-Arrangers;

 

(b)                    that, on or
before the Drawdown Date but prior to the making of the Loan, the Agent
receives the documents described in Part B of Schedule 3 in form and
substance satisfactory to the Co-Arrangers;

 

(c)                     that, on or
before the service of the Drawdown Notice, the Agent receives any fees payable
pursuant to Clause 16.1 and has received payment of the expenses referred to in
Clause 16.2; and

 

(d)                    that both at
the date of the Drawdown Notice and at the Drawdown Date:

 

(i)                       no Event of
Default has occurred and is continuing, unremedied or unwaived or would result
from the borrowing of the Loan;

 

(ii)                    the
representations and warranties in Clause 10 and those of the Borrowers or any
Security Party which are set out in the other Finance Documents would be true
and not misleading if repeated on each of those dates with reference to the
circumstances then existing;

 

(iii)                 none of the
circumstances contemplated by Clause 5.7 has occurred and is continuing;

 

(iv)                there has not (in
the Agent’s opinion) been a material adverse change in the financial position
or state of affairs of any of the Borrowers or any of the Shareholders from
that disclosed to the Agent prior to the date of this Agreement.

 

9.2                  Waiver of conditions precedent. If
the Co-Arrangers, at their discretion, permit the Loan to be borrowed before
certain of the conditions referred to in Clause 9.1 are satisfied, the
Borrowers shall ensure that those conditions are satisfied within 7 Business
Days after the Drawdown Date (or such longer period as the Agent may, with the
authority of the Co-Arrangers, specify).

 

10                     REPRESENTATIONS AND WARRANTIES

 

10.1           General. Each of the Borrowers
represents and warrants to each Creditor Party as follows.

 

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

 

10.3           Share capital and ownership.

 

(a)                     Each Owner
has an authorised share capital of 500 registered shares without par value, and
the legal title and beneficial ownership of those shares is held, free of any
Security Interest or other claim (other than a Permitted Security Interest), by
the Holding Company.

 

(b)                    The Holding
Company has an authorised share capital of 500 registered shares without par
value, all of which shares are (i) legally owned by MK Maritime LLC,
Keagan Enterprises S.A., Gallery Services Limited and Maas Capital Investments
B.V. and (ii) beneficially owned by the Shareholders, in the proportions
disclosed to and agreed by the Co-Arrangers prior to the date of this
Agreement.

 

10.4           Corporate power. Each of the Borrowers
has the corporate capacity, and has taken all corporate action and obtained all
consents necessary for it:

 

19

 

(a)                     (save for the
Holding Company) to execute the Shipbuilding Contract to which it is a party
and to purchase and pay for the Ship under the Shipbuilding Contract to which
it is a party;

 

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

 

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

 

10.5           Consents in force. All the consents
referred to in Clause 10.4 remain in force and nothing has occurred which makes
any of them liable to revocation.

 

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

 

(a)                     constitute
that Borrower’s legal, valid and binding obligations enforceable against that
Borrower in accordance with their respective terms; and

 

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

 

subject
to any relevant insolvency or bankruptcy or similar laws affecting creditors’
rights generally.

 

10.7           No third party Security Interests. Without
limiting the generality of Clause 10.6, at the time of the execution and
delivery of each Finance Document:

 

(a)                     each Borrower
which is a party to that Finance Document will have the right to create all the
Security Interests which that Finance Document purports to create; and

 

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

 

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

 

(a)                     any existing
applicable law or regulation to which that Borrower is subject; or

 

(b)                    the
constitutional documents of that Borrower; or

 

(c)                     any
contractual or other obligation or restriction which is binding on that
Borrower or any of its assets.

 

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

 

10.10    No default. No Event of
Default has occurred and is continuing unremedied or unwaived.

 

20

 

10.11    Information. All
information which has been provided in writing by or on behalf of each of the
Borrowers or any Security Party to any Creditor Party in connection with any
Finance Document satisfied the requirements of Clause 11.5.

 

10.12    No litigation. No legal or
administrative action involving any Borrower has been commenced or taken or, to
any Borrower’s knowledge, is likely to be commenced or taken which could (in
the sole opinion of the Co-Arrangers) have a material adverse effect on such
Borrower’s financial condition, other than any such action which is being
contested in good faith by appropriate legal or administrative proceedings and
particulars of which have been provided to the Agent.

 

10.13    Validity and completeness of
Shipbuilding Contracts/Refund Guarantees.

 

(a)                     The copies of
the Shipbuilding Contracts and the Refund Guarantees delivered to the Agent
before the date of this Agreement are true and complete copies;

 

(b)                    each Shipbuilding
Contract constitutes valid, binding and enforceable obligations of the Builder
and the Borrower which is a party thereto respectively in accordance with its
terms; each Refund Guarantee constitutes valid, binding and enforceable
obligations of the Refund Guarantor in accordance with its terms; and

 

(c)                     no amendments
or additions to any Shipbuilding Contract or any Refund Guarantee have been
agreed (other than as disclosed to the Lenders prior to the date of this
Agreement) nor has any Borrower or the Builder or the Refund Guarantor waived
any of their respective rights under any Shipbuilding Contract or any Refund
Guarantee.

 

10.14    No rebates etc. There is
no agreement or understanding to allow or pay any rebate, premium, commission,
discount or other benefit or payment (howsoever described) to any Borrower, the
Builder or any other Security Party in connection with the purchase by each
Owner of each Ship, other than as disclosed to the Lenders in writing on or
prior to the date of this Agreement.

 

10.15    Compliance with certain
undertakings. At the date of this Agreement, each of the Borrowers is in
compliance with Clauses 11.2, 11.4, 11.9 and 11.13.

 

10.16    Taxes paid. Each of the
Borrowers has paid all taxes applicable to, or imposed on or in relation to it
and its business.

 

10.17    No Money Laundering. Without
prejudice to the generality of Clause 2.3, in relation to the borrowing by the
Borrowers of the Loan, the performance and discharge of their respective
obligations and liabilities under the Finance Documents to which each is a
party, and the transactions and other arrangements effected or contemplated by
the Finance Documents to which each Borrower is a party, each of the Borrowers
confirms that (i) it is acting for its own account, (ii) that it will
use the proceeds of the Loan for its own benefit, under its full responsibility
and exclusively for the purposes specified in this Agreement and (iii) that
the foregoing will not involve or lead to contravention of any law, official
requirements or other regulatory measure or procedure implemented to combat
“money laundering” (as defined in Article 1 of the Directive (91/308/EEC)
of the Council of the European Communities).

 

The
representations made or to be made by the Borrowers under or pursuant to this
Clause 10 are and shall be construed as being made subject to the reservations
or qualifications as to matters of law set forth in the legal opinions to be
delivered to the Agent pursuant to Clause 9.

 

21

 

11                     GENERAL UNDERTAKINGS

 

11.1           General. Each of the Borrowers
undertakes with each Creditor Party to comply with the following provisions of
this Clause 11 at all times during the Security Period except as the
Co-Arrangers may otherwise permit.

 

11.2           Title; negative pledge; pari passu. Each
Borrower will:

 

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

 

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

 

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

 

11.3           No disposal of assets. No Borrower will
transfer, lease or otherwise dispose of:

 

(a)                     (other than a
sale of any of the Ships or the novation, transfer or assignment of any of the
Shipbuilding Contracts, by any of the Owners, and subject to compliance with
the provision of Clauses 8.7 and 8.8), all or a substantial part of its assets,
whether by one transaction or a number of transactions, whether related or not;
or

 

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

 

11.4           No other liabilities or obligations to be
incurred. No Borrower will, without the prior written consent of the
Co-Arrangers (such consent not to be unreasonably withheld or delayed), incur
any liability or obligation except liabilities and obligations under the
Shipbuilding Contract and the Finance Documents, to which it is a party or
incurred in the ordinary course of business.

 

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

 

11.6           Shareholder notices. The Holding Company
will send to the Agent, at the same time as they are dispatched, copies of all
material communications which are dispatched to the Shareholders.

 

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

 

(a)                     to perform
its obligations under the Shipbuilding Contract and any Finance Document to
which it is party;

 

(b)                    for the
validity or enforceability of the Shipbuilding Contract and any Finance
Document to which it is party,

 

and
each Borrower will comply with the terms of all such consents applicable to it.

 

11.8           Maintenance of Security Interests. Each
Borrower will:

 

22

 

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

 

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

 

11.9           Notification of litigation. Each
Borrower will provide the Agent with details of any legal or administrative
action involving that Borrower, any Security Party or Ship owned (or to be
owned) by it as soon as such action is instituted, unless it is clear that the
legal or administrative action cannot be considered material in the context of
any Finance Document.

 

11.10    Principal place of business. Each
Borrower will maintain its place of business, and keep its corporate documents
and records, at the address stated at the commencement of this Agreement; and
no Borrower will establish, or do anything as a result of which it would be
deemed to have, a place of business in the United Kingdom or the United States
of America.

 

11.11    Confirmation of no default. Each
Borrower will, within 2 Business Days after service by the Agent of a written
request, serve on the Agent a notice which is signed by a director of that
Borrower and which:

 

(a)                     states that
no Event of Default has occurred and is continuing unremedied or unwaived; or

 

(b)                    states that no
Event of Default has occurred and is continuing unremedied or unwaived except
for a specified event or matter, of which all material details are given.

 

11.12    Notification of default. Each
Borrower will notify the Agent as soon as that Borrower becomes aware of the
occurrence of an Event of Default and will, for so long as it remains to be
continuing unremedied or unwaived, thereafter keep the Agent fully up-to-date
with all developments.

 

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

 

(a)                     any Borrower
or any Ship; or

 

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

 

which
may be reasonably requested by the Agent, the Security Trustee or any Lender at
any time.

 

11.14    Provision of copies and
translation of documents. The Borrowers will supply the Agent with a
sufficient number of copies of the documents referred to above to provide 1
copy for each Creditor Party; and if the Agent so requires in respect of any of
those documents, the Borrowers will provide a certified English translation
prepared by a translator approved by the Agent.

 

23

 

11.15    Ownership. Each of the Borrowers
shall ensure that there is no change in the legal or beneficial ownership of
the shares, or any change in the control of, any of the Borrowers, provided
that the Holding Company may request changes to its shareholding structure as
disclosed to and agreed by the Co-Arrangers prior to the date of such request,
subject always to the prior written consent of the Co-Arrangers (which shall
not be unreasonably withheld or delayed) and to the Co-Arrangers being
satisfied as to the ultimate beneficial ownership and control of the shares in
the Holding Company.

 

11.16    Right of first refusal. Each
of the Borrowers undertakes to give to each of the Co-Arrangers a right of
first refusal for arranging/underwriting up to 50% of the pre and post-delivery
financing of each of the Ships, and the Borrowers shall be bound to accept such
offer of financing provided that the same is (in the Borrowers’ opinion) the
same as or better than comparable offers of financing obtained by the
Borrowers.

 

11.17    Supervision. Each of the
Borrowers undertakes to provide to the Agent evidence (satisfactory to the
Co-Arrangers in their sole discretion) of the supervision of each of the Ships
by such company as may be acceptable to the Co-Arrangers in their sole
discretion.

 

12                     CORPORATE UNDERTAKINGS

 

12.1           General. Each of the Borrowers also
undertakes with each Creditor Party to comply with the following provisions of
this Clause 12 at all times during the Security Period except as the
Co-Arrangers may otherwise permit.

 

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

 

12.3           Negative undertakings. No Borrower will,
without the prior written consent of the Co-Arrangers (such consent not to be
unreasonably withheld or delayed):

 

(a)                     (in case of
an Owner) carry on any business other than the ownership, chartering and
operation of the Ship to be owned by it, the incurrence of obligations under
the Shipbuilding Contract and the Finance Documents to which it is a party and
activities incidental thereto and (in the case of the Holding Company) carry on
any business other than the ownership of the Owners;

 

(b)                    provide any
form of credit or financial assistance or issue any guarantee to any person, or
enter into any transaction with or involving such a person;

 

(c)                     (save for the
Holding Company) open or maintain any account (other than any accounts already
in existence at the date of this Agreement) with any bank or financial institution,
except accounts with the Agent for the purposes of the Finance Documents;

 

(d)                    issue, allot
or grant any person a right to any shares in its capital or repurchase or
reduce its issued share capital (other than, in the case of the Holding
Company, an increase in its share capital as disclosed to and agreed by the
Co-Arrangers prior to the date of signing of this Agreement);

 

(e)                     acquire any
shares or other securities other than US or UK Treasury bills and certificates
of deposit issued by major North American or European banks, or enter into any
transaction in a derivative (including, without limitation, any interest or
currency swap);

 

24

 

(f)                       enter into
any form of amalgamation, merger or de-merger or any form of reconstruction or
reorganisation save that the Holding Company may take any such action to the
extent that the surviving entity is not (in the sole opinion of the
Co-Arrangers) materially financially weaker and assumes all obligations of the Holding
Company under the Finance Documents to which it is a party;

 

(g)                    incur any
other Financial Indebtedness except Financial Indebtedness to companies within
the same beneficial or ultimate beneficial ownership of the Borrowers on a
fully subordinated basis;

 

(h)                    purchase any
further assets (other than the Ships), either directly or indirectly (through
subsidiaries).

 

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

 

(a)                     claim, or in
a bankruptcy of any Owner prove for, any amount payable to the Holding Company
by an Owner, whether in respect of the Loan or any other transaction;

 

(b)                    take or
enforce any Security Interest for any such amount; or

 

(c)                     claim to
set-off any such amount against any amount payable by the Holding Company to
any Owner.

 

13                     PAYMENTS AND CALCULATIONS

 

13.1           Currency and method of payments. All
payments to be made by the Lenders or by the Borrowers under a Finance Document
shall be made to the Agent or to the Security Trustee:

 

(i)                       by not
later than 11.00 a.m. (New York City time) on the due date;

 

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

 

(iii)                 if in Dollars, to
the account of the Agent with such bank in New York as the Agent may from time
to time notify to the Borrowers and the other Creditor Parties; and

 

(iv)                in the case of an
amount payable to the Security Trustee, to such account as it may from time to
time notify to the Borrowers and the other Creditor Parties.

 

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

 

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

 

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

 

25

 

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

 

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

 

13.4           Distribution of payments to Creditor
Parties. Subject to Clauses 13.5, 13.6 and 13.7:

 

(a)                     any amount
received by the Agent under a Finance Document for distribution or remittance
to a Lender or the Security Trustee shall be made available by the Agent to
that Lender or, as the case may be, the Security Trustee by payment, with funds
having the same value as the funds received, to such account as the Lender or
the Security Trustee may have notified to the Agent not less than 5 Business
Days previously; and

 

(b)                    amounts to be
applied in satisfying amounts of a particular category which are due to the
Lenders generally shall be distributed by the Agent to each Lender pro rata to
the amount in that category which is due to it.

 

13.5           Permitted deductions by Agent. Notwithstanding
any other provision of this Agreement or any other Finance Document, the Agent
may, before making an amount available to a Lender, deduct and withhold from
that amount any sum which is then due and payable to the Agent from that Lender
under any Finance Document or any sum which the Agent is then entitled under
any Finance Document to require that Lender to pay on demand.

 

13.6           Agent only obliged to pay when monies
received. Notwithstanding any other provision of this Agreement or any
other Finance Document, the Agent shall not be obliged to make available to the
Borrowers or any Lender any sum which the Agent is expecting to receive for
remittance or distribution to the Borrowers or that Lender until the Agent has
satisfied itself that it has received that sum.

 

13.7           Refund to Agent of monies not received. If
and to the extent that the Agent makes available a sum to the Borrowers or a
Lender, without first having received that sum, the Borrowers or (as the case
may be) the Lender concerned shall, on demand:

 

(a)                     refund the
sum in full to the Agent; and

 

(b)                    pay to the
Agent the amount (as certified by the Agent) which will indemnify the Agent
against any funding or other loss, liability or expense incurred by the Agent
as a result of making the sum available before receiving it.

 

13.8           Agent may assume receipt. Clause 13.7
shall not affect any claim which the Agent has under the law of restitution,
and applies irrespective of whether the Agent had any form of notice that it
had not received the sum which it made available.

 

13.9           Creditor Party accounts. Each Creditor
Party shall maintain accounts showing the amounts owing to it by the Borrowers
and each Security Party under the Finance Documents and all payments in respect
of those amounts made by the Borrowers and any Security Party.

 

13.10    Agent’s memorandum account. The
Agent shall maintain a memorandum account showing the amounts advanced by the
Lenders and all other sums owing to the Agent, the Security Trustee and each
Lender from the Borrowers and each

 

26

 

Security
Party under the Finance Documents and all payments in respect of those amounts
made by the Borrowers and any Security Party.

 

13.11    Accounts prima facie evidence.
If any accounts maintained under Clauses 13.9 and 13.10 show an amount to
be owing by the Borrowers or a Security Party to a Creditor Party, those
accounts shall, absent manifest error, be prima facie evidence that that amount
is owing to that Creditor Party.

 

14                     APPLICATION OF RECEIPTS

 

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

 

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

 

(i)                       firstly, in
or towards satisfaction pro rata of all amounts then due and payable to the
Creditor Parties under the Finance Documents other than those amounts referred
to at paragraphs (ii) and (iii) (including, but without limitation,
all amounts payable by the Borrowers under Clauses 16, 17 and 18 of this
Agreement or by the Borrowers or any Security Party under any corresponding or
similar provision in any other Finance Document);

 

(ii)                    secondly, in
or towards satisfaction of any and all amounts of default interest and, after,
of normal interest payable to the Creditor Parties under the Finance Documents;
and

 

(iii)                 thirdly, in or
towards satisfaction of the Loan;

 

(b)                    SECONDLY: in
retention of an amount equal to any amount not then due and payable under any
Finance Document but which the Agent, by notice to the Borrowers, the Security
Parties and the other Creditor Parties, states in its opinion will or may
become due and payable in the future and, upon those amounts becoming due and
payable, in or towards satisfaction of them in accordance with the provisions
of Clause 14.1(a); and

 

(c)                     THIRDLY: any
surplus shall be paid to the Borrowers or to any other person appearing to be
entitled to it.

 

14.2           Variation of order of application. The
Co-Arrangers may, by notice to the Borrowers, the Security Parties and the
other Creditor Parties, provide for a different manner of application from that
set out in Clause 14.1 either as regards a specified sum or sums or as regards
sums in a specified category or categories.

 

14.3           Notice of variation of order of application.
The Agent may give notices under Clause 14.2 from time to time; and such a
notice may be stated to apply not only to sums which may be received or
recovered in the future, but also to any sum which has been received or
recovered on or after the third Business Day before the date on which the
notice is served.

 

14.4           Appropriation rights overriden. This
Clause 14 and any notice which the Agent gives under Clause 14.2 shall override
any right of appropriation possessed, and any appropriation made, by the
Borrowers or any Security Party.

 

15                     EVENTS OF DEFAULT

 

15.1           Events of Default. An Event of Default
occurs if:

 

27

 

(a)                     any Borrower
or any Security Party fails to pay when due or (if so payable) within three (3) days
of the date of demand for such, any sum payable under a Finance Document or
under any document relating to a Finance Document; or

 

(b)                    any breach
occurs of Clause 9.2, 11.2, 11.3, 11.15, 12.2, 12.3, 12.4 or 12.5; or

 

(c)                     any breach by
any Borrower or any Security Party occurs of any provision of a Finance
Document (other than a breach covered by paragraphs (a) or (b) above)
if, in the reasonable opinion of the Co-Arrangers, such default is capable of
remedy, and such default continues unremedied 20 days after written notice from
the Agent requesting action to remedy the same; or

 

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

 

(e)                     any
representation, warranty or statement made by, or by an officer of, any
Borrower or a Security Party in a Finance Document or in a Drawdown Notice or
any other notice or document relating to a Finance Document is untrue or
misleading in any material respect and the effect of which is (in the sole
opinion of the Co-Arrangers) to materially effect the security created by a
Finance Document in favour of the relevant Creditor Party when it is made; or

 

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

 

(i)                       any
Financial Indebtedness of a Relevant Person is not paid when due or, if so
payable, on demand (taking into account any applicable grace period); or

 

(ii)                    any Financial
Indebtedness of a Relevant Person becomes due and payable prior to its stated
maturity date as a consequence of any event of default; or

 

(iii)                 any overdraft,
loan, note issuance, acceptance credit, letter of credit, guarantee, foreign
exchange or other facility, relating to any Financial Indebtedness of a
Relevant Person ceases to be available as a result of any event of default, or
cash cover is required, in respect of such a facility as a result of any event
of default unless the Borrowers shall have satisfied the Agent that,
notwithstanding such event, the ability of the Relevant Person in question to
pay its debts as they fall due and meet its commitments has not been effected;
or

 

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

 

(i)                       (in the
case of the Holding Company) any or (in the case of any other Relevant Person)
all or substantially all its assets are subject to any form of execution,
attachment, arrest, sequestration or distress in respect of a sum of, or sums
aggregating, $1,000,000 or more or the equivalent in another currency unless
such execution, attachment, arrest, sequestration or distress is being
contested in good faith and on substantial grounds and is discussed or
withdrawn within forty five (45) days of the occurrence thereof; or

 

(ii)                    any
administrative or other receiver is appointed over (in the case of the Holding
Company) any or (in the case of any other Relevant Person) all or substantially
all of its assets; or

 

(iii)                 a Relevant Person
makes any formal declaration of bankruptcy or any formal statement to the effect
that it is insolvent, or a winding up or administration order is made in
relation to a Relevant Person, or the members or directors of a Relevant Person
pass a resolution to the effect

 

28

 

that
it should be wound up, placed in administration or cease to carry on business,
save that this paragraph does not apply to a fully solvent winding up of a
Relevant Person other than a Borrower or a Shareholder which is, or is to be,
effected for the purposes of an amalgamation or reconstruction previously
approved by the Co-Arrangers and effected not later than 3 months after the
commencement of the winding up; or

 

(iv)                a petition is
presented in any Pertinent Jurisdiction for the winding up or administration,
or the appointment of a provisional liquidator, of a Relevant Person unless the
petition is being contested in good faith and on substantial grounds and is
eventually dismissed; or

 

(v)                   a Relevant
Person petitions a court, or presents any proposal for, any form of judicial or
non-judicial suspension or deferral of payments, reorganisation of its debt (or
certain of its debt) or arrangement with all or a substantial proportion (by
number or value) of its creditors or of any class of them or any such suspension
or deferral of payments, reorganisation or arrangement is effected by court
order, contract or otherwise to the extent that any such suspension, deferral,
reorganisation or arrangement would in the reasonable opinion of the
Co-Arrangers affect materially and adversely the Borrowers’ financial condition
in aggregate; or

 

(vi)                in a Pertinent
Jurisdiction other than England, any event occurs or any procedure is commenced
which, in the reasonable opinion of the Co-Arrangers, is similar to any of the
foregoing; or

 

(h)                    an event of
default occurs (howsoever described) under any swap or other derivative
contract or transaction entered into by a Relevant Person, which is continuing
unremedied or unwaived;

 

(i)                        any
Borrower ceases or suspends carrying on its business or a part of its business
which, in the opinion of the Co-Arrangers, is material in the context of this
Agreement; or

 

(j)                        it becomes
unlawful in any Pertinent Jurisdiction or impossible:

 

(i)                       for any
Borrower or any Security Party to discharge any material liability under a
Finance Document or to comply with any other obligation thereunder which the
Co-Arrangers consider material under a Finance Document; or

 

(ii)                    for the Agent,
the Security Trustee or the Lenders to exercise or enforce any right under, or
to enforce any Security Interest created by, a Finance Document; or

 

(k)                     any consent
necessary to enable any Borrower or any Security Party to comply with any
provision which the Co-Arrangers consider material of a Finance Document or a
Shipbuilding Contract is not granted, expires without being renewed, is revoked
or becomes liable to revocation or any condition of such a consent is not
fulfilled; or

 

(l)                        any
provision which the Co-Arrangers consider material of a Finance Document proves
to have been or becomes invalid or unenforceable, or a Security Interest
created by a Finance Document proves to have been or becomes invalid or
unenforceable or such a Security Interest proves to have ranked after, or loses
its priority to, another Security Interest or any other third party claim or
interest unless the relevant Security Party takes such action as requested by
the Agent to remedy such invalidity or unenforceability and succeeds in doing
so; or

 

29

 

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

 

(i)                       a material
adverse change in the financial position or state of affairs of any Borrower or
any Shareholder; or

 

(ii)                    any accident
or other event involving a vessel owned, chartered or operated by a Relevant
Person,

 

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

 

15.2           Actions following an Event of Default. On,
or at any time after, the occurrence of an Event of Default and provided the
same is continuing unremedied and/or unwaived:

 

(a)                     if so
instructed by the Co-Arrangers, the Agent shall:

 

(i)                       serve on
the Borrowers a notice stating that the Commitments and all other obligations
of each Lender to the Borrowers under this Agreement are terminated; and/or

 

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

 

(iii)                 take any other
action which, as a result of the continuing Event of Default or any notice
served under paragraph (i) or (ii) above, the Agent and/or the
Lenders are entitled to take under any Finance Document or any applicable law;
and/or

 

(b)                    if so
instructed by the Agent, acting with the authorisation of the Co-Arrangers, the
Security Trustee shall take any action whjch, as a result of the continuing
Event of Default or any notice served under paragraph (a) (i) or (ii) above,
the Security Trustee, the Agent and/or the Lenders are entitled to take under
any Finance Document or any applicable law.

 

15.3           Termination of Commitments. On the
service of a notice under paragraph (a)(i) of Clause 15.2, the Commitments
and all other obligations of each Lender to the Borrowers under this Agreement
shall terminate.

 

15.4           Acceleration of Loan. On the service of
a notice under paragraph (a)(ii) of Clause 15.2, the Loan, all accrued
interest and all other amounts accrued or owing from the Borrowers or any
Security Party under this Agreement and every other Finance Document shall
become immediately due and payable or, as the case may be, payable on demand.

 

15.5           Multiple notices; action without notice. The
Agent may serve notices under paragraphs (a) (i) and (ii) of
Clause 15.2 simultaneously or on different dates and it and/or the Security
Trustee may take any action referred to in that Clause if no such notice is
served or simultaneously with or at any time after the service of both or
either of such notices.

 

15.6           Notification of Creditor Parties and
Security Parties. The Agent shall send to each Lender, the Security Trustee
and each Security Party a copy or the text of any notice which the Agent serves
on the Borrowers under Clause 15.2; but the notice shall become effective when
it is served on the Borrowers, and no failure or delay by the Agent to send a
copy or the text of the notice to any other person shall

 

30

 

invalidate
the notice or provide the Borrowers or any Security Party with any form of
claim or defence.

 

15.7           Creditor Parties’ rights unimpaired. Nothing
in this Clause shall be taken to impair or restrict the exercise of any right
given to individual Lenders under a Finance Document or the general law; and,
in particular, this Clause is without prejudice to Clause 3.1.

 

15.8           Exclusion of Creditor Party Liability. No
Creditor Party, and no receiver or manager appointed by the Security Trustee,
shall have any liability to the Borrowers or a Security Party:

 

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

 

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

 

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

 

15.9           Relevant Persons. In this Clause 15 “a Relevant Person” means (i) with
respect to sub clauses (f), (g) and (h), the Borrowers and the
Shareholders and (ii) with respect to all other sub clauses, the
Borrowers.

 

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

 

16                     FEES AND EXPENSES

 

16.1           Arrangement and commitment fees. The
Borrowers shall pay to the Agent arrangement and commitment fees as set out in
the fee letter addressed by the Borrowers to the Co-Arrangers and dated the
same date as this Agreement.

 

16.2           Costs of negotiation, preparation etc. The
Borrowers shall pay to the Agent on its demand the amount of all reasonable and
documented expenses incurred by the Agent or the Security Trustee in connection
with the negotiation, preparation, execution or registration of any Finance
Document or any related document or with any transaction contemplated by a
Finance Document or a related document.

 

16.3           Costs of variations, amendments, enforcement
etc. The Borrowers shall pay to the Agent, on the Agent’s demand, the
amount of all reasonable and documented expenses incurred by a Lender in
connection with:

 

(a)                     any amendment
or supplement to a Finance Document, or any proposal for such an amendment to
be made in each case requested by a Borrower (but excluding, for the avoidance
of doubt, any such expense incurred in connection with the assignment, transfer
or sub-participation of any of the rights and/or obligations of a Creditor
Party under any of the Finance Documents);

 

31

 

(b)                    any consent or
waiver by the Co-Arrangers, the Lenders or the Creditor Party concerned under
or in connection with a Finance Document, or any request for such a consent or
waiver in each case initiated by a Borrower;

 

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

 

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

 

16.4           Documentary taxes. The Borrowers shall
promptly pay any tax payable on or by reference to any Finance Document, and
shall, on the Agent’s demand, fully indemnify each Creditor Party against any
liabilities and expenses resulting from any failure or delay by the Borrowers
to pay such a tax (except for any such taxes incurred in connection with any
such transfer, assignment or sub-participation of any of the rights and/or
obligations of a Creditor Party under any of the Finance Documents).

 

16.5           Certification of amounts. A notice which
is signed by two officers of a Creditor Party, which states that a specified
amount, or aggregate amount, is due to that Creditor Party under this Clause 16
and which indicates (without necessarily specifying a detailed breakdown) the
matters in respect of which the amount, or aggregate amount, is due shall, save
for manifest error, be prima facie evidence that the amount, or aggregate
amount, is due.

 

17                     INDEMNITIES

 

17.1           Indemnities regarding borrowing and repayment
of Loan. The Borrowers shall fully indemnify the Agent and each Lender on
the Agent’s demand and the Security Trustee on its demand in respect of all
documented expenses, liabilities and losses which are incurred by that Creditor
Party, or which that Creditor Party reasonably and with due diligence estimates
that it will incur, as a result of or in connection with:

 

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

 

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

 

(c)                     any failure
(for whatever reason) by the Borrowers to make payment of any amount due under
a Finance Document on the due date or, if so payable, on demand (after giving
credit for any default interest paid by the Borrowers on the amount concerned
under Clause 7);

 

(d)                    the occurrence
and continuance of an Event of Default and/or the acceleration of repayment of
the Loan under Clause 15;

 

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

 

17.2           Breakage costs. Without limiting its
generality, Clause 17.1 covers any liability, expense or loss, including a loss
of a prospective profit, incurred by a Lender:

 

32

 

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

 

(b)                    in terminating,
or otherwise in connection with, any interest and/or currency swap or any other
transaction entered into (whether with another legal entity or with another
office or department of the Lender concerned) to hedge any exposure arising
under this Agreement or that part which the Lender concerned determines is
fairly attributable to this Agreement of the amount of the liabilities,
expenses or losses (including losses of prospective profits) incurred by it in
terminating, or otherwise in connection with, a number of transactions of which
this Agreement is one.

 

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

 

(a)                     making or
lodging any claim or proof against any Borrowers or any Security Party, whether
in its liquidation, any arrangement involving it or otherwise; or

 

(b)                    obtaining an
order or judgment from any court or other tribunal; or

 

(c)                     enforcing any
such order or judgment;

 

the
Borrowers shall indemnify the Creditor Party concerned against the loss arising
when the amount of the payment actually received by that Creditor Party is
converted at the available rate of exchange into the Contractual Currency.

 

In
this Clause 17.3, the “available rate of
exchange” means the rate at which the Creditor Party concerned is
able at the opening of business (London time) on the Business Day after it
receives the sum concerned to purchase the Contractual Currency with the
Payment Currency.

 

This
Clause 17.3 creates a separate liability of each of the Borrowers which is
distinct from its other liabilities under the Finance Documents and which shall
not be merged in any judgment or order relating to those other liabilities.

 

17.4           Certification of amounts. A notice which
is signed by 2 officers of a Creditor Party, which states that a specified
amount, or aggregate amount, is due to that Creditor Party under this Clause 17
and which indicates (without necessarily specifying a detailed breakdown) the
matters in respect of which the amount, or aggregate amount, is due shall, save
for manifest error, be prima facie evidence that the amount, or aggregate
amount, is due.

 

17.5           Sums deemed due to a Lender. For the
purposes of this Clause 17, a sum payable by any of the Borrowers to the Agent
or the Security Trustee for distribution to a Lender shall be treated as a sum
due to that Lender.

 

18                     NO SET-OFF OR TAX DEDUCTION

 

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

 

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

 

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

 

33

 

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

 

(a)                     that Borrower
shall notify the Agent as soon as it becomes aware of the requirement;

 

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

 

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

 

18.3           Evidence of payment of taxes. Within 1
month after making any tax deduction, the relevant Borrower shall deliver to
the Agent documentary evidence satisfactory to the Agent that the tax had been
paid to the appropriate taxation authority.

 

18.4           Exclusion of tax on overall net income. In
this Clause 18 “tax deduction” means
any deduction or withholding for or on account of any present or future tax
except tax on a Creditor Party’s overall net income.

 

18.5           Claw-back of tax benefit. If, following
any such deduction or withholding as is referred to in Clause 18.2 from any
payment by the Borrowers, a Lender shall receive or be granted a credit against
or remission for any taxes payable by it, such Lender shall, subject to the
Borrowers having made any increased payment in accordance with Clause 18.2 and
to the extent that such Lender can do so without prejudicing the retention of
the amount of such credit or remission and without prejudice to the right of
such Lender to obtain any other relief or allowance which may be available to
it, reimburse the Borrowers with such amount as such Lender shall in its
absolute discretion certify to be the proportion of such credit or remission as
will leave such Lender (after such reimbursement) in no worse position than it
would have been in had there been no such deduction or withholding from the
payment by the Borrowers as aforesaid. Such reimbursement shall be made
forthwith upon such Lender certifying that the amount of such credit or
remission has been received by it. Nothing contained in this Agreement shall
oblige a Lender to rearrange its tax affairs or to disclose any information
regarding its tax affairs and computations. Without prejudice to the generality
of the foregoing, the Borrowers shall not, by virtue of this Clause 18.5, be
entitled to enquire about a Lender’s tax affairs.

 

19                     ILLEGALITY, ETC

 

19.1           Illegality. This Clause 19 applies if a
Lender (the “Notifying Lender”) notifies
the Agent that at any time after the date of this Agreement it has become, or
will with effect from a specified date, become:

 

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

 

(b)                    contrary to,
or inconsistent with, any regulation,

 

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

 

19.2           Notification of illegality. The Agent
shall promptly notify the Borrowers, the Security Parties, the Security Trustee
and the other Lenders of the notice under Clause 19.1 which the Agent receives
from the Notifying Lender.

 

34

 

19.3           Prepayment; termination of Commitment. On
the Agent notifying the Borrowers under Clause 19.2, the Notifying Lender’s
Commitment shall terminate; and on the date specified in the Notifying Lender’s
notice under Clause 19.1 as the date on which the notified event would become
effective, which should be not earlier than the latest date permitted by law,
the Borrowers shall prepay the Notifying Lender’s Contribution in accordance
with Clause 8.

 

19.4           Mitigation. If circumstances arise which
would result in a notification under Clause 19.1 then, without in any way
limiting the rights of the Notifying Lender under Clause 19.3, the Notifying
Lender shall use reasonable endeavours to transfer its obligations, liabilities
and rights under this Agreement and the Finance Documents to another office or
financial institution not affected by the circumstances but the Notifying
Lender shall not be under any obligation to take any such action if, in its
opinion, to do would or might:

 

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

 

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

 

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

 

20                     INCREASED COSTS

 

20.1           Increased costs. This Clause 20 applies
if a Lender (the “Notifying Lender”) notifies
the Agent that the Notifying Lender considers that as a result of:

 

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

 

(b)                    the effect of
complying with any regulation (including any which relates to capital adequacy
or liquidity controls or which affects the manner in which the Notifying Lender
allocates capital resources to its obligations under this Agreement) which is
introduced, or altered, or the interpretation or application of which is
altered, after the date of this Agreement,

 

is
that the Notifying Lender (or a parent company of it) has incurred or will
incur an “increased cost”, that is to say:

 

(i)                       an
additional or increased cost incurred as a result of, or in connection with,
the Notifying Lender having entered into, or being a party to, this Agreement
or a Transfer Certificate, of funding or maintaining its Commitment or
Contribution or performing its obligations under this Agreement, or of having
outstanding all or any part of its Contribution or other unpaid sums; or

 

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

 

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

 

35

 

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

 

but
not an item attributable to a change in the rate of tax on the overall net
income of the Notifying Lender (or a parent company of it) or an item covered
by the indemnity for tax in Clause 17.1 or by Clause 18.

 

For
the purposes of this Clause 20.1 the Notifying Lender may in good faith
allocate or spread costs and/or losses among its assets and liabilities (or any
class thereof) on such basis as it considers appropriate.

 

20.2           Notification to Borrowers of claim for
increased costs. The Agent shall promptly notify the Borrowers and the
Security Parties of the notice which the Agent received from the Notifying
Lender under Clause 20.1.

 

20.3           Payment of increased costs. The
Borrowers shall pay to the Agent, on the Agent’s demand, for the account of the
Notifying Lender the amounts which the Agent from time to time notifies the
Borrowers that the Notifying Lender has specified to be necessary to compensate
the Notifying Lender for the increased cost.

 

20.4           Notice of prepayment. If the Borrowers
are not willing to continue to compensate the Notifying Lender for the
increased cost under Clause 20.3, the Borrowers may give the Agent not less than
3 days’ notice of their intention to prepay the Notifying Lender’s
Contribution.

 

20.5           Prepayment; termination of Commitment. A
notice under Clause 20.4 shall be irrevocable; the Agent shall promptly notify
the Notifying Lender of the Borrowers’ notice of intended prepayment; and:

 

(a)                     on the date
on which the Agent serves that notice, the Commitment of the Notifying Lender
shall be cancelled; and

 

(b)                    on the date
specified in its notice of intended prepayment, the Borrowers shall prepay
(without premium or penalty) the Notifying Lender’s Contribution, together with
accrued interest thereon at the applicable rate plus the Margin.

 

20.6           Application of prepayment. Clause 8
shall apply in relation to the prepayment.

 

21                     SET-OFF

 

21.1    Application of
credit balances. Each Creditor Party may following an Event
of Default and whilst the same is continuing unremedied or unwaived without
prior notice:

 

(a)                     apply any
balance which at any time stands to the credit of any account in the name of
any of the Borrowers at any office in any country of that Creditor Party in or
towards satisfaction of any sum then due from any of the Borrowers to that
Creditor Party under any of the Finance Documents; and

 

(b)                    for that
purpose:

 

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

 

(ii)                    convert or
translate all or any part of a deposit or other credit balance into Dollars;

 

36

 

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

 

21.2           Existing rights unaffected. No Creditor
Party shall be obliged to exercise any of its rights under Clause 21.1; and
those rights shall be without prejudice and in addition to any right of
set-off, combination of accounts, charge, lien or other right or remedy to
which a Creditor Party is entitled (whether under the general law or any
document).

 

21.3           Sums deemed due to a Lender. For the
purposes of this Clause 21, a sum payable by the Borrowers to the Agent or the
Security Trustee for distribution to, or for the account of, a Lender shall be
treated as a sum due to that Lender; and each Lender’s proportion of a sum so
payable for distribution to, or for the account of, the Lenders shall be
treated as a sum due to such Lender.

 

21.4           No Security Interest. This Clause 21
gives the Lenders a contractual right of set off only, and does not create any
equitable charge or other Security Interest over any credit balance of any of
the Borrowers.

 

22                     TRANSFERS AND CHANGES IN LENDING
OFFICES

 

22.1           Transfer by Borrowers. No Borrower may,
without the consent of the Agent, given on the instructions of all the Lenders
transfer any of its rights or obligations under any Finance Document.

 

22.2           Transfer by a Lender. Subject to Clause
22.4, a Lender (the “Transferor Lender”) may
at any time transfer:

 

(a)                     its rights in
respect of all or part of its Contribution; or

 

(b)                    its
obligations in respect of all or part of its Commitment; or

 

(c)                     a combination
of (a) and (b);

 

to be
(in the case of its rights) transferred to, or (in the case of its obligations)
assumed by, another bank or financial institution (a “Transferee Lender”) by delivering to the Agent a completed
certificate in the form set out in Schedule 5 with any modifications approved
or required by the Agent (a “Transfer
Certificate”) executed by the Transferor Lender and the Transferee
Lender.

 

However
any rights and obligations of the Transferor Lender in its capacity as Agent or
Security Trustee will have to be dealt with separately in accordance with the
Agency and Trust Deed.

 

22.3           Transfer Certificate, delivery and
notification. As soon as reasonably practicable after a Transfer
Certificate is delivered to the Agent, it shall (unless it has reason to
believe that the Transfer Certificate may be defective):

 

(a)                     sign the
Transfer Certificate on behalf of itself, the Borrowers, the Security Parties,
the Security Trustee and each of the other Lenders;

 

(b)                    on behalf of
the Transferee Lender, send to the Borrowers and each Security Party letters or
faxes notifying them of the Transfer Certificate and attaching a copy of it;

 

(c)                     send to the
Transferee Lender copies of the letters or faxes sent under paragraph (b) above.

 

37

 

22.4           Effective Date of Transfer Certificate. A
Transfer Certificate becomes effective on the date, if any, specified in the
Transfer Certificate as its effective date Provided
that it is signed by the Agent under Clause 22.3 on or before that
date.

 

22.5           No transfer without Transfer Certificate. No
assignment or transfer of any right or obligation of a Lender under any Finance
Document is binding on, or effective in relation to, the Borrowers, any
Security Party, the Agent or the Security Trustee unless it is effected,
evidenced or perfected by a Transfer Certificate.

 

22.6           Lender re-organisation; waiver of Transfer
Certificate. However, if a Lender enters into any merger, de-merger or
other reorganisation as a result of which all its rights or obligations vest in
another person (the “successor”), the
Agent may, if it sees fit, by notice to the successor and the Borrowers and the
Security Trustee waive the need for the execution and delivery of a Transfer
Certificate; and, upon service of the Agent’s notice, the successor shall
become a Lender with the same Commitment and Contribution as were held by the
predecessor Lender.

 

22.7           Effect of Transfer Certificate. A
Transfer Certificate takes effect in accordance with English law as follows:

 

(a)                     to the extent
specified in the Transfer Certificate, all rights and interests (present,
future or contingent) which the Transferor Lender has under or by virtue of the
Finance Documents are assigned to the Transferee Lender absolutely, free of any
defects in the Transferor Lender’s title;

 

(b)                    the Transferor
Lender’s Commitment is discharged to the extent specified in the Transfer
Certificate;

 

(c)                     the
Transferee Lender becomes a Lender with the Contribution previously held by the
Transferor Lender and a Commitment of an amount specified in the Transfer
Certificate;

 

(d)                    the Transferee
Lender becomes bound by all the provisions of the Finance Documents which are
applicable to the Lenders generally, including those about pro-rata sharing and
the exclusion of liability on the part of, and the indemnification of, the
Agent and the Security Trustee and, to the extent that the Transferee Lender
becomes bound by those provisions (other than those relating to exclusion of
liability), the Transferor Lender ceases to be bound by them;

 

(e)                     any part of
the Loan which the Transferee Lender advances after the Transfer Certificate’s
effective date ranks in point of priority and security in the same way as it
would have ranked had it been advanced by the transferor, assuming that any
defects in the transferor’s title and any rights or equities of the Borrowers
or any Security Party against the Transferor Lender had not existed;

 

(f)                       the
Transferee Lender becomes entitled to all the rights under the Finance
Documents which are applicable to the Lenders generally, including but not
limited to those under Clause 5.7 and Clause 16, and to the extent that the
Transferee Lender becomes entitled to such rights, the Transferor Lender ceases
to be entitled to them; and

 

(g)                    in respect of
any breach of a warranty, undertaking, condition or other provision of a
Finance Document or any misrepresentation made in or in connection with a
Finance Document, the Transferee Lender shall be entitled to recover damages by
reference to the loss incurred by it as a result of the breach or
misrepresentation, irrespective of whether the original Lender would have
incurred a loss of that kind or amount.

 

38

 

The
rights and equities of the Borrowers or any Security Party referred to above
include, but are not limited to, any right of set off and any other kind of
cross-claim.

 

22.8           Maintenance of register of Lenders. During
the Security Period the Agent shall maintain a register in which it shall
record the name, Commitment, Contribution and administrative details (including
the lending office) from time to time of each Lender holding a Transfer
Certificate and the effective date (in accordance with Clause 22.4) of the
Transfer Certificate; and the Agent shall make the register available for
inspection by any Lender, the Security Trustee and the Borrowers during normal
banking hours, subject to receiving at least 3 Business Days prior notice.

 

22.9           Reliance on register of Lenders. The
entries on that register shall, in the absence of manifest error, be conclusive
in determining the identities of the Lenders and the amounts of their
Commitments and Contributions and the effective dates of Transfer Certificates
and may be relied upon by the Agent and the other parties to the Finance
Documents for all purposes relating to the Finance Documents.

 

22.10    Authorisation of Agent to sign
Transfer Certificates. Subject to no cost being incurred by the Borrowers
as a result of any assignment or transfer or sub- participation, the Borrowers,
the Security Trustee and each Lender irrevocably authorise the Agent to sign
Transfer Certificates on its behalf.

 

22.11    Registration fee. In
respect of any Transfer Certificate, the Agent shall be entitled to recover a
registration fee of $2,000 from the Transferor Lender or (at the Agent’s
option) the Transferee Lender.

 

22.12    Sub-participation; subrogation
assignment. A Lender may sub-participate all or any part of its rights
and/or obligations under or in connection with the Finance Documents without
the consent of, or any notice to, the Borrowers, any Security Party, the Agent
or the Security Trustee; and the Lenders may assign, in any manner and terms
agreed by the Co-Arrangers, the Agent and the Security Trustee, all or any part
of those rights to an insurer or surety who has become subrogated to them.

 

22.13    Disclosure of information. A
Lender may disclose to a potential Transferee Lender or sub-participant any
information which the Lender has received in relation to the Borrowers, any
Security Party or their affairs under or in connection with any Finance
Document, unless the information is clearly of a confidential nature and
provided always such Lender first procures that the relevant prospective
assignee, substitute or transferee or other person (such person together with
any prospective assignee, substitute or transferee being hereinafter described
as the “Prospective Assignee”) shall
undertake to the Borrowers to keep secret and confidential and, not without the
prior written consent of the Borrowers, disclose to any third party any of the
information, reports or documents supplied by such Lender provided however that
the Prospective Assignee shall be entitled to disclose any such information,
reports or documents in the following situations:

 

(a)                     in relation
to any proceedings arising out of this Agreement or the other Finance Documents
to the extent considered necessary by the Prospective Assignee to protect its
interest; or

 

(b)                    pursuant to a
court order relating to discovery or otherwise; or

 

(c)                     pursuant to
any law or regulation or to any fiscal, monetary, tax, governmental or other
competent authority; or

 

(d)                    to its
auditors, legal or other professional advisers.

 

39

 

In
addition, the Prospective Assignee shall be entitled to disclose or use any
such information, reports or documents if the information contained therein
shall have emanated, in conditions free from confidentiality, bona fide from
some person other than such Lender.

 

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

 

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

 

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

 

22.15    Notification. On receiving
such a notice, the Agent shall notify the Borrowers and the Security Trustee;
and, until the Agent receives such a notice, it shall be entitled to assume
that a Lender is acting through the lending office of which the Agent last had
notice.

 

22.16    No additional costs. If at
the time of, or immediately after, any assignment by a Lender of all or any
part of its rights or benefits under this Agreement or any transfer by a Lender
of any part of the rights, benefits and/or obligations under this Agreement, or
any change in the office through which a Lender lends for the purposes of this
Agreement or a Lender’s re-organisation under Clause 22.6, the Borrowers would
be obliged to pay to the Assignee or Transferee or the successor (as defined in
Clause 22.6) or (in the case of a change of lending office) such Lender under
Clauses 5.5, 18.2 or 20.1 any sum in excess of the sum (if any) which it would
have been obliged to pay to such Lender under the relevant clauses in the
absence of such assignment, transfer or change, the Borrowers shall not be
obliged to pay that excess.

 

23                     VARIATIONS AND WAIVERS

 

23.1           Variations, waivers etc. by Lenders. Unless
otherwise provided for in this Agreement, 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 all of the Lenders, 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.

 

23.2           Exclusion of other or implied variations. Except
for a document which satisfies the requirements of Clause 23.1, 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
any Borrower or any 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,

 

40

 

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.

 

24                     NOTICES

 

24.1           General. 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.

 

24.2           Addresses for communications. A notice
shall be sent:

 

	
  (a)

  	
  to the Borrowers: 

  	
  c/o

  	
  Alma Maritime Ltd.

  13 Pandoras & Kyprou Street

  166 74 Glyfada

  Athens

  Greece

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Fax No: +30 210 8944 688 

  Attention: Stamatis Molaris

  
	
   

  	
   

  	
   

  
	
  (b)

  	
  to a Lender:

  	
  At the address below its name in Schedule 2 or (as
  the case may require) in the relevant Transfer Certificate;

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  (c)

  	
  to each Co-Arranger and each Co-Underwriter:

  	
  Fortis Bank

  166 Syngrou Avenue

  176 71 Athens

  Greece

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Fax No: +30 210 9544 368

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Bayerische Hypo-und Vereinsbank AG

  62 Notara Street

  185 35 Piraeus

  Greece

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Fax No: +30 210 412 6597

  
	
   

  	
   

  	
   

  
	
  (d)

  	
  to the Agent and Security Trustee:

  	
  166 Syngrou Avenue

  176 71 Athens 

  Greece

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Fax No:+30 210 9544 368

  
					

 

or to
such other address as the relevant party may notify the Agent or, if the
relevant party is the Agent or the Security Trustee, the Borrowers, the Lenders
and the Security Parties.

 

24.3           Effective date of notices. Subject to
Clauses 24.4 and 24.5:

 

(a)                     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;

 

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

 

41

 

24.4           Service outside business hours. However,
if under Clause 24.3 a notice would be deemed to be served:

 

(a)                     on a day
which is not a business day in the place of receipt; or

 

(b)                    on such a
business day, but after 5 p.m. local time;

 

the
notice shall (subject to Clause 24.5) be deemed to be served, and shall take
effect, at 9 a.m. on the next day which is such a business day.

 

24.5           Illegible notices. Clauses 24.3 and 24.4
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.

 

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

 

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

 

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

 

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

 

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

 

25                     JOINT AND SEVERAL LIABILITY

 

25.1           General. All liabilities and obligations
of the Borrowers under this Agreement shall, whether expressed to be so or not,
be several and, if and to the extent consistent with Clause 25.2, joint.

 

25.2           No impairment of Borrowers’ obligations. The
liabilities and obligations of a Borrower shall not be impaired by:

 

(a)                     this
Agreement being or later becoming void, unenforceable or illegal as regards any
other Borrower;

 

(b)                    any Lender or
the Security Trustee entering into any rescheduling, refinancing or other
arrangement of any kind with any other Borrower;

 

(c)                     any Lender or
the Security Trustee releasing any other Borrower or any Security Interest
created by a Finance Document; or

 

(d)                    any
combination of the foregoing.

 

25.3           Principal debtors. Each Borrower
declares that it is and will, throughout the Security Period, remain a
principal debtor for all amounts owing under this Agreement and the Finance
Documents and no Borrower shall in any circumstances be construed to be a
surety for the obligations of any other Borrower under this Agreement.

 

42

 

25.4           Subordination. Subject to Clause 25.5,
during the Security Period, no Borrower shall:

 

(a)                     claim any
amount which may be due to it from any other Borrower whether in respect of a
payment made, or matter arising out of, this Agreement or any Finance Document,
or any matter unconnected with this Agreement or any Finance Document; or

 

(b)                    take or
enforce any form of security from any other Borrower for such an amount, or in
any other way seek to have recourse in respect of such an amount against any
asset of any other Borrower; or

 

(c)                     set off such
an amount against any sum due from it to any other Borrower; or

 

(d)                    prove or claim
for such an amount in any liquidation, administration, arrangement or similar
procedure involving any other Borrower or other Security Party; or

 

(e)                     exercise or
assert any combination of the foregoing.

 

25.5           Borrowers’ required action. If during
the Security Period, the Lender, by notice to a Borrower, requires it to take
any action referred to in paragraphs (a) to (d) of Clause 25.4, in
relation to any other Borrower, that Borrower shall take that action as soon as
practicable after receiving the Agent’s notice.

 

26                     SUPPLEMENTAL

 

26.1           Rights cumulative, non-exclusive. The
rights and remedies which the Finance Documents give to each Creditor Party
are:

 

(a)                     cumulative;

 

(b)                    may be
exercised as often as appears expedient; and

 

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

 

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

 

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

 

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

 

27                     LAW AND JURISDICTION

 

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

 

27.2           Exclusive English jurisdiction. Subject
to Clause 27.3, the courts of England shall have exclusive jurisdiction to
settle any disputes which may arise out of or in connection with this
Agreement.

 

27.3           Choice of forum for the exclusive benefit of
the Creditor Parties. Clause 27.2 is for the exclusive benefit of the
Creditor Parties, each of which reserves the right:

 

43

 

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

 

(b)                    to commence
such proceedings in the courts of any such country or countries concurrently
with or in addition to proceedings in England or without commencing proceedings
in England.

 

No
Borrower shall commence any proceedings in any country other than England in
relation to a matter which arises out of or in connection with this Agreement.

 

27.4           Process agent. Each of the Borrowers
irrevocably appoints Saville & Co. at their office for the time being,
presently at One Carey Lane, London EC2V 8AE, 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.

 

27.5           Creditor Party rights unaffected. Nothing
in this Clause 27 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.

 

27.6           Meaning of “proceedings”. In  this Clause 27, “proceedings” means proceedings of any kind, including an
application for a provisional or protective measure.

 

AS WITNESS the hands of the duly authorised
officers or attorneys of the parties the day and year first before written.

 

44

 

SCHEDULE 1

 

BORROWERS

 

	
  Name

  	
   

  	
  Country of Incorporation

  	
   

  	
  Registered Address

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Suez Turquoise Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Suez Amber Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex 

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Suez Crystal Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex 

  Ajeltake Road 

  Ajeltake Island, Majuro

  The Marshall Islands 

  MH 96960

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Suez Topaz Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex 

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Suez Diamond Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex 

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Suez Jade Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex 

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Suez Pearl Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex 

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Suez Emerald Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex 

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  

 

45

 

	
  Suez
  Ruby Limited

  	
   

  	
  Marshall
  Islands

  	
   

  	
  Trust
  Company Complex

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Alma
  Maritime Limited

  	
   

  	
  Marshall
  Islands

  	
   

  	
  Trust
  Company Complex 

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  

 

46

 

SCHEDULE 2

 

LENDERS AND
COMMITMENTS

 

	
  Lender

  	
   

  	
  Lending Office

  	
   

  	
  Commitment

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fortis
  Bank

  	
   

  	
  166
  Syngrou Avenue 

  17671 Athens 

  Greece

  	
   

  	
  $

  	
  55,800,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bayerische
  Hypo-und 

  Vereinsbank AG

  	
   

  	
  7
  Heraklitou Street 

  GR 10673 Athens 

  Greece

  	
   

  	
  $

  	
  55,800,000

  	
   

  

 

47

 

SCHEDULE 3

 

DRAWDOWN NOTICE

 

	
  To:

  	
  Fortis Bank

  
	
   

  	
  166 Syngrou Avenue

  
	
   

  	
  176 71 Athens

  
	
   

  	
  Greece

  

 

Attention: [Loans
Administration]

 

2008

 

DRAWDOWN NOTICE

 

1.                         We
refer to the loan agreement (the “Loan
Agreement”) dated
                     
2008 and made between (1) ourselves as Borrowers, (2) the Lenders
referred to therein, (3) the Co-Arrangers and Co-Underwriters referred to
therein and (4) yourselves as Agent and as Security Trustee in connection
with a facility of up to US$111,600,000. Terms defined in the Loan Agreement
have their defined meanings when used in this Drawdown Notice.

 

2.                         We
request to borrow the Loan as follows:

 

(a)                     Amount:
US$[           ];

 

(b)                    Drawdown Date:
[          ];

 

(c)                     Duration of
the first Interest Period shall be [          ]
months;

 

(d)                    Payment
instructions: account of [                    ]
and numbered
[                ]
with
[                ]
of
[                ].

 

3.                         We
represent and warrant that:

 

(a)                     the
representations and warranties in Clause 10 of the Loan Agreement would remain
true and not misleading if repeated on the date of this notice with reference
to the circumstances now existing;

 

(b)                    no Event of
Default has occurred and is continuing or will result from the borrowing of the
Loan.

 

4.                         This
notice cannot be revoked without the prior consent of the Lenders.

 

	
   

  	
   

  	
   

  

 

Attorney-in-Fact

for and on behalf of

SUEZ TURQUOISE LIMITED

SUEZ AMBER LIMITED

SUEZ CRYSTAL LIMITED

SUEZ TOPAZ LIMITED

SUEZ DIAMOND LIMITED

SUEZ JADE LIMITED

SUEZ PEARL LIMITED

SUEZ EMERALD LIMITED

SUEZ RUBY LIMITED

ALMA MARITIME LIMITED

 

48

 

SCHEDULE 4

 

CONDITION PRECEDENT DOCUMENTS

 

PART A

 

The
following are the documents referred to in Clause 9.1(a).

 

1.                         A
duly executed original of this Agreement, the Agency and Trust Deed and each of
the Predelivery Security Assignments (together with notices of assignment
signed by the Owners thereunder).

 

2.                         The
Letters of Undertaking duly executed by the Shareholders or such other evidence
of commitment by the Shareholders of their equity participation throughout the
construction period of each of the Ships (including, for the avoidance of
doubt, their equity participation in the delivery instalment for each Ship and
any additional costs and expenses related to the construction of the Ships in
excess of the Contract Price of each Ship) as may be acceptable to the Co-
Arrangers in their sole and absolute discretion, in each case in a form and
substance satisfactory to the Co-Arrangers in their sole and absolute discretion.

 

3.                         Copies
of the certificate of incorporation and constitutional documents of each of the
Borrowers.

 

4.                         Copies
of resolutions of the shareholders (if applicable) and directors of each of the
Borrowers, authorising the execution of each of the Finance Documents referred
to at 1 above to which each Borrower is a party and, in the case of each
Borrower, authorising named officers to give the Drawdown Notice and other
notices under this Agreement.

 

5.                         The
original of any power of attorney under which any Finance Document referred to
at 1 above is executed on behalf of each Borrower.

 

6.                         Copies
of all consents which any Borrower or any Security Party requires to enter
into, or make any payment under, any Finance Document or the Shipbuilding
Contract to which it is a party.

 

7.                         A
copy of each Shipbuilding Contract (in a form and substance satisfactory to the
Co-Arrangers) and of all documents signed or issued by the Borrower which is a
party thereto or the Builder (or either of them) under or in connection
therewith, together with evidence of authorisation with respect to the
execution thereof by the relevant Borrower and the Builder.

 

8.                         An
original of each Refund Guarantee (in a form and substance satisfactory to the
Co-Arrangers), together with evidence of authorisation with respect to the
execution thereof by the Refund Guarantor (which shall be a bank or financial
institution acceptable to the Co-Arrangers in their sole discretion).

 

9.                         Evidence
satisfactory to the Co-Arrangers in their sole discretion with respect to the
supervision of each Ship during construction by such company as may be
acceptable to the Co-Arrangers in their sole discretion.

 

10.                  A
certificate in a form and substance satisfactory to the Co-Arrangers confirming
the legal and beneficial ownership of the shares in the Holding Company, signed
by the ultimate beneficial owners of the shares in the Holding Company.

 

11.                  All
documentation required by the Co-Arrangers in respect of each of the Borrowers,
each of the Shareholders and any other Security Party, its directors and
shareholders pursuant to each Co-Arranger’s “Know Your Customer”

 

49

 

requirements,
together with such other documents or evidence as either of the Co-Arrangers
may reasonably require with respect to relevant money laundering requirements.

 

12.                  Evidence
satisfactory to the Co-Arrangers in their sole discretion that a Shareholders’
agreement has been signed with respect to the shareholdings in the Holding
Company, together with copies of the constitutional documents of any corporate
vehicles holding shares in the Holding Company on behalf of the Shareholders.

 

13.                  Documentary
evidence that the agent for service of process named in Clause 26 has accepted
its appointment.

 

14.                  Legal
opinions from lawyers appointed by the Agent on such matters concerning the
laws of the Republic of The Marshall Islands, Korea and such other relevant
jurisdictions as the Agent may require, in a form and substance acceptable to
the Co-Arrangers.

 

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

 

PART B

 

The
following are the documents referred to in Clause 9.1(b):

 

1.                         A
duly issued invoice from the Builder showing all sums due and payable to the
Builder in respect of the First Instalment for each Ship pursuant to Article X2(a) of
each Shipbuilding Contract.

 

2.                         Evidence
that the Shareholders have remitted to the Builder or to the Agent their equity
participation in respect of the First Instalment for each Ship (in addition to
the amount of the Loan).

 

Every copy
document delivered under this Schedule shall be certified as a true and up to
date copy by a director or the secretary (or equivalent officer) of a Borrower.

 

50

 

SCHEDULE 5

 

TRANSFER CERTIFICATE

 

The
Transferor and the Transferee accept exclusive responsibility for ensuring that
this Certificate and the transaction to which it relates comply with all legal
and regulatory requirements applicable to them respectively.

 

To:                 Fortis Bank for
itself and for and on behalf of each of the Borrowers, each Security Party, the
Security Trustee and each Lender, as defined in the Loan Agreement referred to
below.

 

1.                         This
Certificate relates to a Loan Agreement (the “Loan
Agreement”) dated
[             ]
2008 and made between (1) the companies named therein as joint and several
Borrowers, (2) the banks and financial institutions named therein as
Lenders, (3) Fortis Bank and Bayerische Hypo-und Vereinsbank AG as
Co-Arrangers and Co-Underwriters and (4) Fortis Bank as Agent and Security
Trustee, for a loan facility of up to US$111,600,000.

 

2.                         In
this Certificate:

 

“the Relevant Parties” means
the Agent, each Borrower, each Security Party, the Security Trustee and each
Lender;

 

“the Transferor” means [full
name] of [lending office];

 

“the Transferee” means [full
name] of [lending office].

 

Terms
defined in the Loan Agreement shall, unless the contrary intention appears,
have the same meanings when used in this Certificate.

 

3.                         The
effective date of this Certificate is
[                         ]
Provided that this Certificate
shall not come into effect unless it is signed by the Agent on or before that
date.

 

4.                         The
Transferor assigns to the Transferee absolutely all rights and interests
(present, future or contingent) which the Transferor has as Lender under or by
virtue of the Loan Agreement and every other Finance Document in relation to
[         ] per cent. of the
Contribution outstanding to the Transferor (or its predecessors in title) which
is set out below:

 

Contribution                                                                                                                                                                                                          Amount
transferred

 

 

5.                         By
virtue of this Transfer Certificate and Clause 22 of the Loan Agreement, the
Transferor is discharged [entirely from its Commitment which amounts to
$[        ]] [from
[        ] per cent. of its Commitment,
which percentage represents $[        ]]
and the Transferee acquires a Commitment of
$[        ].

 

6.                         The
Transferee undertakes with the Transferor and each of the Relevant Parties that
the Transferee will observe and perform all the obligations under the Finance

 

51

 

Documents
which Clause 22 of the Loan Agreement provides will become binding on it upon
this Certificate taking effect.

 

7.                         The Agent, at the request
of the Transferee (which request is hereby made) accepts, for the Agent itself
and for and on behalf of every other Relevant Party, this Certificate as a
Transfer Certificate taking effect in accordance with Clause 22 of the Loan
Agreement.

 

8.                         The Transferor:

 

(a)                     warrants to
the Transferee and each Relevant Party:

 

(i)                       that the
Transferor has full capacity to enter into this transaction and has taken all
corporate action and obtained all consents which are in connection with this
transaction; and

 

(ii)                    that this
Certificate is valid and binding as regards the Transferor;

 

(b)                    warrants to
the Transferee that the Transferor is absolutely entitled, free of
encumbrances, to all the rights and interests covered by the assignment in
paragraph 4 above;

 

(c)                     undertakes
with the Transferee that the Transferor will, at its own expense, execute any
documents which the Transferee reasonably requests for perfecting in any
relevant jurisdiction the Transferee’s title under this Certificate or for a
similar purpose.

 

9.                         The
Transferee:

 

(a)                     confirms that
it has received a copy of the Loan Agreement and each other Finance Document;

 

(b)                    agrees that it
will have no rights of recourse on any ground against either the Transferor,
the Agent, the Security Trustee or any Lender in the event that:

 

(i)                       the Finance
Documents prove to be invalid or ineffective,

 

(ii)                    any Borrower
or any Security Party fails to observe or perform its obligations, or to
discharge its liabilities, under the Finance Documents;

 

(iii)                 it proves
impossible to realise any asset covered by a Security Interest created by a
Finance Document, or the proceeds of such assets are insufficient to discharge
the liabilities of any Borrower or Security Party under the Finance Documents;

 

(c)                     agrees that
it will have no rights of recourse on any ground against the Agent, the
Security Trustee or any Lender in the event that this Certificate proves to be
invalid or ineffective;

 

(d)                    warrants to
the Transferor and each Relevant Party (i) that it has full capacity to
enter into this transaction and has taken all corporate action and obtained all
official consents which it needs to take or obtain in connection with this
transaction; and (ii) that this Certificate is valid and binding as
regards the Transferee; and

 

(e)                     confirms the
accuracy of the administrative details set out below regarding the Transferee.

 

10.                  The Transferor and the Transferee
each undertake with the Agent and the Security Trustee severally, on demand,
fully to indemnify the Agent and/or the Security

 

52

 

Trustee
in respect of any claim, proceeding, liability or expense (including all legal
expenses) which they or either of them may incur in connection with this
Certificate or any matter arising out of it, except such as are shown to have
been mainly and directly caused by the gross and culpable negligence or
dishonesty of the Agent’s or the Security Trustee’s own officers or employees.

 

11.                  The Transferee shall repay to the
Transferor on demand so much of any sum paid by the Transferor under paragraph
10 above as exceeds one-half of the amount demanded by the Agent or the
Security Trustee in respect of a claim, proceeding, liability or expense which
was not reasonably foreseeable at the date of this Certificate; but nothing in
this paragraph shall affect the liability of each of the Transferor and the
Transferee to the Agent or the Security Trustee for the full amount demanded by
it.

 

	
  [Name
  of Transferor]

  	
  [Name of Transferee]

  
	
   

  	
   

  
	
  By:

  	
   

  	
  By:

  
	
   

  	
   

  
	
  Date:

  	
  Date:

  
			

 

 

Agent

 

Signed for itself and for and on behalf of itself 

as Agent and for every other Relevant Party

 

Fortis
Bank

 

By:

 

Date:

 

53

 

Administrative Details of Transferee

 

Name of
Transferee:

 

Lending Office:

 

Contact Person

(Loan
Administration Department):

 

Telephone:

 

Telex:

 

Fax:

 

Contact Person

(Credit
Administration Department):

 

Telephone:

 

Telex:

 

Fax:

 

Account for
payments:

 

 

Note: This Transfer Certificate alone may
not be sufficient to transfer a proportionate share of the Transferor’s
interest in the security constituted by the Finance Documents in the
Transferor’s or Transferee’s jurisdiction. It is the responsibility of each
Lender to ascertain whether any other documents are required for this purpose.

 

54

 

EXECUTION PAGES

 

	
  BORROWERS

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  SUEZ TURQUISE LIMITED

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  SUEZ AMBER LIMITED

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
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  SIGNED by [Illegible]

  	
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  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  SUEZ CRYSTAL LIMITED

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
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  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  SUEZ TOPAZ LIMITED

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  SUEZ DIAMOND LIMITED

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  SUEZ JADE LIMITED

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  SUEZ PEARL LIMITED

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  SUEZ EMERALD LIMITED

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  SUEZ RUBY LIMITED

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  

 

55

 

	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  ALMA MARITIME LIMITED

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LENDERS

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
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  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  FORTIS BANK

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  BAYERISCHE HYPO-UND VEREINSBANK
  AG

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CO-ARRANGERS

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  FORTIS BANK

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  BAYERISCHE HYPO-UND VEREINSBANK
  AG

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CO-UNDERWRITERS

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
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  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  FORTIS BANK

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  BAYERISCHE HYPO-UND VEREINSBANK
  AG

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  

 

56

 

	
  AGENTS

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  FORTIS BANK

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECURITY TRUSTEE

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for and on behalf of [Illegible]

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  FORTIS BANK

  	
  )

  	
   

  	
   

  	
   

  
	
  in the presence of:
  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  

 

 

	
  JEREMY
  M. WATSON

  	
   

  
	
  SOLICITOR

  	
   

  
	
  CONSTANT &
  CONSTANT

  	
   

  
	
  2,
  DEFTERAS MERARCHIAS

  	
   

  
	
  PIRAEUS 185 36 - GREECE

  	
   

  

 

 

57

 

DRAWDOWN NOTICE

 

	
  To:

  	
  Fortis Bank

  
	
   

  	
  166 Syngrou Avenue

  
	
   

  	
  176 71 Athens

  
	
   

  	
  Greece

  

 

Attention: Loans
Administration

 

24th June 2008

 

DRAWDOWN NOTICE

 

1.                         We refer to the loan
agreement (the “Loan Agreement”)
dated 23rd  June 2008 and
made between (1) ourselves as Borrowers, (2) the Lenders referred to
therein, (3) the Co-Arrangers and Co-Underwriters referred to therein and (4) yourselves
as Agent and as Security Trustee in connection with a facility of up to
US$111,600,000. Terms defined in the Loan Agreement have their defined meanings
when used in this Drawdown Notice.

 

2.                         We
request to borrow the Loan as follows:

 

(a)                     Amount:
US$111,600,000;

 

(b)                    Drawdown Date: 24th June 2008;

 

(c)                     Duration of
the first Interest Period shall be three (3) months;

 

(d)                    Payment
instructions:

 

Credit
the sum of US$165,960,000 (being the Loan amount of US$111,600,000 and the
amount of US$54,360,000 by way of Borrowers’ equity which you have provided to
us separately) to the following account:

 

	
   

  	
  Beneficiary
  Name:

  	
   

  	
  HYUNDAI
  HEAVY INDUSTRIES CO. LTD

  
	
   

  	
   

  	
   

  	
  1,
  JEONHA-DONG, DONG-KU, ULSAN, KOREA

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Receiving
  Bank:

  	
   

  	
  EXPORT-IMPORT
  BANK OF KOREA

  
	
   

  	
  Swift
  Code:

  	
   

  	
  EXIKKRSE

  
	
   

  	
  Account
  no.:

  	
   

  	
  04-029-695
  (with through bank)

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Through
  Bank:

  	
   

  	
  DEUTSCHE
  BANK TRUST COMPANY AMERICAS,

  
	
   

  	
   

  	
   

  	
  60
  WALL STREET, MAIL STOP

  
	
   

  	
   

  	
   

  	
  NYC
  60-1310, NEW YORK, N.Y. 10005, USA

  

 

3.                         We
represent and warrant that:

 

(a)                     the
representations and warranties in Clause 10 of the Loan Agreement would remain
true and not misleading if repeated on the date of this notice with reference
to the circumstances now existing;

 

(b)                    no Event of
Default has occurred and is continuing or will result from the borrowing of the
Loan.

 

 

4.                         This
notice cannot be revoked without the prior consent of the Lenders.

 

	
   

  	
  /s/ Illegible

  	
   

  

 

Attomey-in-Fact

for and on behalf of

SUEZ TURQUOISE LIMITED

SUEZ AMBER LIMITED

SUEZ CRYSTAL LIMITED

SUEZ TOPAZ LIMITED

SUEZ DIAMOND LIMITED

SUEZ JADE LIMITED

SUEZ PEARL LIMITED

SUEZ EMERALD LIMITED

SUEZ RUBY LIMITED 

ALMA MARITIME LIMITED

 

2

 

Dated 27 October 2009

 

THE COMPANIES

listed in Schedule 1

as joint and several Borrowers

 

THE BANKS AND FINANCIAL INSTITUTIONS

listed in Schedule 2

as  Lenders

 

-and-

 

FORTIS BANK and

BAYERISCHE HYPO-UND

VEREINSBANK AG

as Co-Arrangers and Co-Underwriters

 

-and-

 

FORTIS BANK

as Agent and Security Trustee

 

 

SUPPLEMENTAL AGREEMENT

 

 

in relation to a Loan Agreement dated

23 June 2008 for a bridge facility of

up to US$111,600,000

 

CONSTANT & CONSTANT

2, Defteras Merarchias

185 35 Piraeus

Greece

 

 

INDEX

 

	
  Clause

  	
   

  	
  Page No.

  
	
   

  	
   

  	
   

  
	
  1

  	
  DEFINITIONS

  	
  1

  
	
   

  	
   

  	
   

  
	
  2

  	
  AGREEMENT OF THE
  CREDITOR PARTIES

  	
  3

  
	
   

  	
   

  	
   

  
	
  3

  	
  CONDITIONS

  	
  3

  
	
   

  	
   

  	
   

  
	
  4

  	
  AMENDMENTS TO LOAN
  AGREEMENT AND FINANCE DOCUMENTS

  	
  4

  
	
   

  	
   

  	
   

  
	
  5

  	
  CONTINUANCE OF LOAN
  AGREEMENT AND FINANCE DOCUMENTS

  	
  12

  
	
   

  	
   

  	
   

  
	
  6

  	
  REPRESENTATIONS AND
  WARRANTIES

  	
  12

  
	
   

  	
   

  	
   

  
	
  7

  	
  FURTHER ASSURANCES

  	
  13

  
	
   

  	
   

  	
   

  
	
  8

  	
  FEES AND EXPENSES

  	
  14

  
	
   

  	
   

  	
   

  
	
  9

  	
  COMMUNICATIONS

  	
  14

  
	
   

  	
   

  	
   

  
	
  10

  	
  SUPPLEMENTAL

  	
  14

  
	
   

  	
   

  	
   

  
	
  11

  	
  LAW AND JURISDICTION

  	
  14

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 1 BORROWERS

  	
  18

  
	
   

  	
   

  
	
  SCHEDULE 2 LENDERS AND
  COMMITMENTS

  	
  20

  
	
   

  	
   

  
	
  SCHEDULE 3 DEED OF
  RELEASE

  	
  21

  
	
   

  	
   

  
	
  SCHEDULE 4 ACCOUNT
  PLEDGE

  	
  24

  

 

 

THIS
SUPPLEMENTAL AGREEMENT dated 27 October 2009 and made

 

BETWEEN:

 

(1)                     THE COMPANIES listed in Schedule 1, as
joint and several Borrowers;

 

(2)                     THE BANKS AND FINANCIAL INSTITUTIONS listed
in Schedule 2, as Lenders;

 

(3)                     FORTIS BANK and BAYERISCHE HYPO - UND VEREINSBANK AG, as Co-Arrangers and Co-Underwriters; and

 

(4)                     FORTIS BANK, as
Agent and Security Trustee,

 

IS
SUPPLEMENTAL  to a Loan
Agreement dated 23 June 2008 (the “Original
Loan Agreement”) as amended by side letters dated 12 March 2009,
31 March 2009 and 24 April 2009 respectively (together with the
Original Loan Agreement, the “Loan
Agreement”) made between (i) the Borrowers as joint and several
borrowers, (ii) the Lenders, (iii) the Co-Arrangers and
Co-Underwriters and (iv) the Agent and the Security Trustee, pursuant to
which the Lenders made available to the Borrowers a bridge facility of up to
$111,600,000 upon the terms and for the purposes therein specified.

 

WHEREAS:

 

(A)                 Pursuant to the
Original Loan Agreement, the Lenders agreed to provide bridge financing of up
to US$111,600,000 for the purposes of financing part of the cost of the first
instalments due to Hyundai Heavy Industries Co., Ltd under nine shipbuilding
contracts relating to nine newbuilding crude oil carriers under construction in
Korea. The Lenders advanced the sum of US$111,600,000 to the Borrowers on 24 June 2008.

 

(B)                   Pursuant to the
Side Letter dated 24 April 2009, the Lenders agreed (inter alia) to the
cancellation by the Borrowers of the shipbuilding contracts relating to Hull No. 2297,
Hull No. 2298, Hull No. 2299, Hull No. 2304 and Hull No. 2305
and to certain changes to the shipbuilding contracts relating to Hull No. 2300,
Hull No. 2301, Hull No. 2302 and Hull No. 2303.

 

(C)                   The Borrowers
have now requested the Lenders’ consent to certain changes to the legal and
beneficial ownership of the shares in the Holding Company and, in particular,
to the release of Mr. Gavriil Panagiotidis from his Letter of Undertaking
dated 23 June 2008 (as amended).

 

(D)                  The Borrowers,
the Lenders, the Co-Arrangers, the Co-Underwriters, the Agent and the Security
Trustee have agreed that as a condition to the Lenders agreeing to the
Borrowers’ request and agreeing to continue making the Loan available to the
Borrowers, the Loan Agreement will be amended and the Borrowers will procure
the provision of additional security for the Loan, on the terms and conditions
hereafter set out.

 

NOW
THEREFORE IT IS HEREBY AGREED

 

1                            DEFINITIONS

 

1.1                  Words and
expressions defined in the Loan Agreement and the recitals hereto and not
otherwise defined herein shall have the same meanings when used in this
Supplemental Agreement.

 

 

1.2                  In this
Supplemental Agreement, unless the contrary intention appears:

 

“Account
Pledge” means a pledge agreement creating security in respect
of the Cash Collateral Account, to be executed by the Borrowers in favour of
the Lenders, in the form attached as Schedule 4;

 

“Cash
Collateral Account” means an account in the name of the
Borrowers held with the Agent in Athens designated “Alma Maritime Limited et al – Cash Collateral Account” or any
other account (with that or another office of the Agent) which is designated by
the Agent as the Cash Collateral Account for the purposes of this Agreement;

 

“First
Instalment” means, in relation to a Ship, the first
instalment paid by the relevant Owner to the Builder under the Shipbuilding
Contract for that Ship, in the sum of US$18,440,000;

 

“Market
Value” means, in relation to a Ship, the market value of that
Ship determined pursuant to the provisions of Clause 12.5;

 

“Second
Instalment” means, in relation to a Ship, the second
instalment paid by the relevant Owner to the Builder under the Shipbuilding
Contract for that Ship, in the sum of US$9,465,610;

 

“Shares Pledge”
means, in relation to each Owner, the pledge of the shares in
that Owner dated 12 March 2009 and executed by the relevant Owner in
favour of the Security Trustee;

 

“Third
Instalment” means, in relation to a Ship, the third
instalment paid by the relevant Owner to the Builder under the Shipbuilding
Contract for that Ship, in the sum of US$4,834,390;

 

“Time
Charter” means, in relation to a Ship, the time charterparty
entered into or to be entered into by the Owner of the relevant Ship with the
Time Charterer for a period of not less than seven (7) years commencing
from the date of delivery of the relevant Ship thereunder, at a minimum rate of
US$35,400 per day (gross of commissions) and including a 50-50 profit sharing
arrangement, and otherwise upon terms and in a form acceptable to the
Co-Arrangers in their sole discretion;

 

“Time
Charter Assignment” means, in relation to each Time Charter,
an assignment of the relevant Owner’s rights under such Time Charter, to be
executed in favour of the Security Trustee in such form as the Co-Arrangers may
approve or reasonably require;

 

“Time
Charterer” means The Sanko Steamship Co. Ltd of Tokyo, Japan.

 

1.3                  Where the
context so admits words importing the singular number only shall include the
plural and vice versa and words importing persons shall include firms and
corporations. Clause headings are inserted for convenience of reference only
and shall be ignored in construing this Supplemental Agreement. References to
Clauses are to clauses of this Supplemental Agreement save as may be otherwise
expressly provided in this Supplemental Agreement.

 

2

 

2                            AGREEMENT
OF THE CREDITOR PARTIES

 

2.1                  The Creditor
Parties, relying upon each of the representations and warranties set out in
Clauses 7.1 and 7.2 of this Supplemental Agreement, hereby agree with the
Borrowers as follows, subject to and upon the terms and conditions of this
Supplemental Agreement:

 

(a)                     to the
transfer by Keagan Enterprises S.A. of all of its shares in the Holding Company
to MK Maritime LLC and to the release of Mr. Gavriil Panagiotidis from his
Letter of Undertaking dated 23 June 2008 (as amended) by way of a deed of
release in the form attached as Schedule 3, subject to and with effect from the
fulfilment of the conditions precedent set out in Clause 3.1; and

 

(b)                    to the
amending, varying and supplementing of the Loan Agreement in accordance with
the terms of Clause 4.1, subject to and with effect from the fulfilment of the
conditions precedent set out in Clause 3.1.

 

3                            CONDITIONS

 

3.1                  The agreement of
the Creditor Parties contained in Clause 2.1 of this Supplemental Agreement
shall be expressly subject to the condition that the Agent shall have received
in form and substance satisfactory to the Agent on or before the signature
hereof:-

 

(a)                     documents of
the kind specified in Schedule 4, Part A, Paragraphs 4, 5 and 6 of the
Loan Agreement (as amended and supplemented by this Supplemental Agreement, and
updated with appropriate modifications to refer to this Supplemental
Agreement), together with certified true copies of the constitutional documents
of the Legal Shareholders;

 

(b)                    an original of
this Supplemental Agreement, duly executed by the parties to it;

 

(c)                     an executed
and certified true copy of each Time Charter (including any addenda thereto);

 

(d)                    an original of
each Time Charter Assignment, duly executed by the parties thereto;

 

(e)                     an original
of the Account Pledge, duly executed by the parties thereto;

 

(f)                       a
certificate in a form and substance satisfactory to the Co-Arrangers confirming
the legal and beneficial ownership of the shares in the Holding Company
(following the share transfer referred to in Clause 5.1 hereof), signed by the
ultimate beneficial owners of the shares in the Holding Company;

 

(g)                    all
documentation required by the Co-Arrangers in respect of each of the Borrowers,
each of the Legal Shareholders, their respective directors and shareholders,
and each of the Shareholders, pursuant to each Co-Arranger’s “Know Your
Customer” requirements, together with such other documents or evidence as any
of the Co-Arrangers may reasonably require with respect to relevant money
laundering requirements;

 

(h)                    an executed
copy of the agreement made or to be made between Keagan Enterprises S.A. and MK
Maritime LLC with respect to the sale and purchase of (inter alia) part of the
issued share capital of the Holding Company, together with evidence
satisfactory to the Co-Arrangers in their sole direction that (i) the
share transfer referred to therein has been properly and validly effected and (ii) the
shareholders’ agreement with respect to the shareholdings in the Holding
Company has been amended to reflect such new shareholdings;

 

3

 

(i)                        evidence
that the Cash Collateral Account has been opened with the Agent in Athens
together with execution of all signature cards, mandates, etc. required in
relation to the opening thereof, and that the sum of $6,500,000 was credited
thereto at least one day prior to the date of this Supplemental Agreement;

 

(j)                        all
information required by the Lenders with respect to each of the Borrowers, each
of the Legal Shareholders and each of the Shareholders, required to comply with
the client acceptance procedures of the Lenders, including but not limited to:

 

(i)                       evidence of
due incorporation, including but not limited to an up to date extract from the
relevant chamber of commerce and/or an up to date certificate of good standing;

 

(ii)                    a director’s
certificate, setting out the names of all directors and legal/beneficial
shareholders;

 

(iii)                 copies of the
passports of all directors (except those who have resigned); and

 

(iv)                copies of articles
of association or other constitutional documents;

 

(k)                     a favourable
legal opinion from lawyers appointed by the Agent on such matters concerning
the laws of the Marshall Islands and such other relevant jurisdictions as the
Co-Arrangers may require;

 

(l)                        documentary
evidence from the existing agent for service of process appointed on behalf of
the Borrowers under the Original Loan Agreement, confirming that their existing
appointment covers service of process on behalf of the Borrowers under this
Supplemental Agreement and under each Time Charter Assignment; and

 

(m)                  an amendment to
the Letter of Undertaking dated 23 June 2008 (as amended) and executed by Mr. Hans
Mende reflecting the share transfer referred to in Clause 5.1 hereof and in a
form and substance acceptable to the Co-Arrangers in their sole discretion.

 

4                            AMENDMENTS
TO LOAN AGREEMENT AND FINANCE DOCUMENTS

 

4.1                  In
consideration of the agreement of the Creditor Parties contained in Clause 2.1
of this Supplemental Agreement, the Borrowers hereby agree with the Creditor
Parties that the provisions of the Loan Agreement shall, as of the date on
which the conditions precedent set out in Clause 3 have been complied with to
the satisfaction of the Agent, be varied and/or amended and/or supplemented as
follows:-

 

(a)                     by deleting
Recital (A) thereof and replacing it with the following:

 

“(A)          The Lenders have agreed
to make available to the Borrowers a facility of up to US$111,600,000 in one
advance, but not exceeding the lesser of (i) 85.22% of the aggregate
amount of the First Instalment, the Second Instalment and the Third Instalment
for each of the Ships under each Shipbuilding Contract and (ii) 35.2% of
the aggregate amount of the Contract Price of each of the Ships, for the
purpose of providing bridge financing for part of the cost of the First
Instalment, the Second Instalment and the Third Instalment for each Ship under
the Shipbuilding Contracts.”;

 

4

 

(b)                    by adding in
Clause 1.1 thereof each of the definitions in Clause 1.2 of this Supplemental
Agreement;

 

(c)                     by deleting
the definition of Contract Price in Clause 1.1 thereof and replacing it with
the following:

 

“ “Contract Price” means, in relation to a
Ship, $93,070,610 being the amount payable by the relevant Borrower pursuant to
the Shipbuilding Contract (including the additional fee of $625,000 payable
under Agreement No. 2) relating to that Ship (as the same may be further
adjusted pursuant to the terms of the Shipbuilding Contract);”;

 

(d)                    by deleting
the definition of Finance Documents in Clause 1.1 thereof and replacing it with
the following:

 

“ “Finance Documents” means:

 

(a)                    this
Agreement;

 

(b)                   the Agency and
Trust Deed;

 

(c)                    the
Predelivery Security Assignments;

 

(d)                   the Shares
Pledges;

 

(e)                    the Account
Pledge;

 

(f)                      the Time
Charter Assignments; and

 

(g)                   any other
document (whether creating a Security Interest or not) which is executed at any
time by any of the Borrowers 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 Lenders under this Agreement or any of the documents
referred to in this definition (provided that, for the avoidance of doubt, the
Letters of Undertaking shall not constitute Finance Documents);”;

 

(e)                     by deleting
the definition of Legal Shareholders in Clause 1.1 thereof and replacing it
with the following:

 

“ “Legal Shareholders” means:

 

(a)                    MK Maritime
LLC of the Marshall Islands, being the legal owner of 59.5% of the issued
shares of the Holding Company;

 

(b)                   Gallery
Services Limited of the Marshall Islands, being the legal owner of 8.5% of the
issued shares of the Holding Company;

 

(c)                    Kingsway
Navigation Limited of the Marshall Islands, being the legal owner of 4% of the issued shares of the Holding
Company;

 

(d)                   Progressive
Shipholding S.A. of the Marshall Islands, being the legal owner of 12.5% of the
issued shares of the Holding Company; and

 

(e)                    Maas Capital
Investments B.V. of the Netherlands, being the legal owner of 15.5% of the
issued shares of the Holding Company;”;

 

5

 

(f)                       by deleting
the definition of Margin in Clause 1.1 thereof and replacing it with the
following:

 

“ “Margin” means three per cent (3%) per
annum;”;

 

(g)                    by deleting
the definition of Repayment Date in Clause 1.1 thereof and replacing it with the
following:

 

“ “Repayment Date” means the earlier of (i) 31
December 2010 and (ii) the due date for the payment of the fourth
instalment under each Shipbuilding Contract;”;

 

(h)                    by deleting
the definition of Refund Guarantee in Clause 1.1 thereof and replacing it with
the following:

 

“ “Refund Guarantee” means:

 

(a)                    in relation to
Hull No. 2300, the irrevocable and unconditional guarantee number
M0902-806-LG-00040 dated 5 June 2008 (as amended by the first supplemental
letter thereto dated 1 December 2008, a second supplemental letter thereto
dated 30 December 2008 and a third supplemental letter thereto dated 29 May 2009)
issued by the Refund Guarantor in favour of the relevant Borrower pursuant to
the Shipbuilding Contract for that Ship;

 

(b)                   in relation to
Hull No. 2301, the irrevocable and unconditional guarantee number
M0902-806-LG-00057 dated 5 June 2008 (as amended by the first supplemental
letter thereto dated 1 December 2008, a second supplemental letter thereto
dated 30 December 2008 and a third supplemental letter thereto dated 29 May 2009)
issued by the Refund Guarantor in favour of the relevant Borrower pursuant to
the Shipbuilding Contract for that Ship;

 

(c)                    in relation to
Hull No. 2302, the irrevocable and unconditional guarantee number M0902-806-LG-00064
dated 5 June 2008 (as amended by the first supplemental letter thereto
dated 1 December 2008, a second supplemental letter thereto dated 30 December 2008
and a third supplemental letter thereto dated 29 May 2009) issued by the
Refund Guarantor in favour of the relevant Borrower pursuant to the
Shipbuilding Contract for that Ship;

 

(d)                   in relation to
Hull No. 2303, the irrevocable and unconditional guarantee number
M0902-806-LG-00071 dated 5 June 2008 (as amended by the first supplemental
letter thereto dated 1 December 2008, a second supplemental letter thereto
dated 30 December 2008 and a third supplemental letter thereto dated 29 May 2009)
issued by the Refund Guarantor in favour of the relevant Borrower pursuant to
the Shipbuilding Contract for that Ship;”;

 

(i)                        by
deleting the definition of Shipbuilding Contract in Clause 1.1 thereof and
replacing it with the following:

 

“ “Shipbuilding Contract” means:

 

(a)                    in relation to
Hull No. 2300, the shipbuilding contract dated 2 June 2008 (as amended
by Addendum No. 1 thereto dated 17 November 2008 and Addendum No. 2
thereto dated 17 December 2008, and by Agreement No. 1 and Agreement No. 2
relating thereto each dated 3 April 2009) made between the Builder and the
relevant Borrower for the construction by the Builder of Hull No. 2300 and
its purchase by the relevant Borrower (as further supplemented and/or amended
from time to time);

 

6

 

(b)                   in relation to
Hull No. 2301, the shipbuilding contract dated 2 June 2008 (as
amended by Addendum No. 1 thereto dated 17 November 2008 and Addendum
No. 2 thereto dated 17 December 2008, and by Agreement No. 1 and
Agreement No. 2 relating thereto each dated 3 April 2009) made
between the Builder and the relevant Borrower for the construction by the
Builder of Hull No. 2301 and its purchase by the relevant Borrower (as
further supplemented and/or amended from time to time);

 

(c)                    in relation to
Hull No. 2302, the shipbuilding contract dated 2 June 2008 (as
amended by Addendum No. 1 thereto dated 17 November 2008 and Addendum
No. 2 thereto dated 17 December 2008, and by Agreement No. 1 and
Agreement No. 2 relating thereto each dated 3 April 2009) made
between the Builder and the relevant Borrower for the construction by the
Builder of Hull No. 2302 and its purchase by the relevant Borrower (as
further supplemented and/or amended from time to time);

 

(d)                   in relation to
Hull No. 2303, the shipbuilding contract dated 2 June 2008 (as
amended by Addendum No. 1 thereto dated 17 November 2008 and Addendum
No. 2 thereto dated 17 December 2008, and by Agreement No. 1 and
Agreement No. 2 relating thereto each dated 3 April 2009) made
between the Builder and the relevant Borrower for the construction by the
Builder of Hull No. 2303 and its purchase by the relevant Borrower (as
further supplemented and/or amended from time to time);”;

 

(j)                        by
deleting the definition of Ships in Clause 1.1 thereof and replacing it with
the following:

 

“ “Ships” means Hull No. 2300, Hull No. 2301,
Hull No. 2302 and Hull No. 2303;”;

 

(k)                     by deleting
all references to Hull No. 2297, Hull No. 2298, Hull No. 2299,
Hull No. 2304 and Hull No. 2305, and construing all Clauses and
Schedules accordingly;

 

(l)                        by
deleting Clause 2.1 thereof and replacing it with the following:

 

“2.1          Amount of facility. Subject
to the other provisions of this Agreement, the Lenders shall make available to
the Borrowers a loan facility in one advance not exceeding the lesser of (a) $111,600,000,
(b) 85.22% of the aggregate amount of the First Instalment, the Second
Instalment and the Third Instalment for each of the Ships under each
Shipbuilding Contract and (c) 35.2% of the aggregate amount of the
Contract Price of each of the Ships.”;

 

(m)                  by deleting
Clause 4.2(b) thereof and replacing it with the following:

 

“(b)             the amount of the
Loan shall not exceed the lesser of (i) $111,600,000, (ii) 85.22% of
the aggregate amount of the First Instalment, the Second Instalment and the
Third Instalment for each of the Ships under each Shipbuilding Contract and (iii) 35.2%
of the aggregate amount of the Contract Price of each of the Ships;”;

 

(n)                    by deleting
Clause 8.7 thereof and replacing it with the following:

 

“8.7   Mandatory prepayment. The
Borrowers shall be obliged to prepay the Relevant Amount of the Loan:

 

7

 

(a)                                  if
a Ship is sold (prior to or after delivery) (which sale includes sale for
scrapping), on or before the date on which the sale is completed by delivery of
such Ship to the buyer;

 

(b)                                 if
a Ship becomes a Total Loss, on the date falling 90 days after the Total Loss
Date;

 

(c)                                  if
any of the following occurs, on demand by the Agent:

 

(i)                                     a
Shipbuilding Contract is novated, transferred or assigned;

 

(ii)                                  a
Shipbuilding Contract or a Refund Guarantee is cancelled, terminated, rescinded
or suspended or otherwise ceases to remain in force for any reason; or

 

(iii)                               a
Shipbuilding Contract or a Refund Guarantee is materially amended or varied
without the prior written consent of the Lenders except for any such amendment
or variation as is permitted by this Agreement or any other relevant Finance
Document.

 

In this Clause 8.7, “Relevant Amount” means:

 

(aa)                            in the
case of Clauses 8.7 (a) or (b), the amount of the Loan which is equal to
the amount in full of the sale proceeds or Total Loss proceeds (as the case may
be); and

 

(bb)                          in the
case of Clause 8.7(c), the amount of the Loan which is equal to the aggregate
amount of the First Instalment, the Second Instalment and the Third Instalment
funded by the Lenders under this Agreement and which relates to the Ship which
is the subject of the Shipbuilding Contract or Refund Guarantee in question (as
the case may be) (being not more than 1⁄4  of
the amount of the Loan originally drawn down by the Borrowers).

 

Provided always that the
Co-Arrangers agree to consider (without being obliged to do so) a request by
the Borrowers to waive the provisions of Clause 8.7(b) upon the
circumstances existing at the time.”;

 

(o)                                 by
deleting Clause 10.3 thereof and replacing it with the following:

 

“10.3
Share capital and ownership.

 

(a)                                  Each
Owner has an authorised share capital of 500 registered shares without par
value, and the legal title and beneficial ownership of those shares is held,
free of any Security Interest or other claim (other than a Permitted Security
Interest), by the Holding Company.

 

(b)                                 The
Holding Company has an authorised share capital of 50,000,000 registered shares
without par value, out of which 1,000,000 shares have been issued and all of
which issued shares are (i) legally owned by the Legal Shareholders and (ii) beneficially
owned by the Shareholders, in each case in the proportions disclosed to and
agreed by the Co-Arrangers prior to the date of this Agreement.”;

 

(p)                                 by
deleting Clause 11.15 thereof and replacing it with the following:

 

8

 

“ 11.15 Ownership. Each of the Borrowers shall ensure that there
is no change in the legal or beneficial ownership of the shares, or any change
in the control of, any of the Borrowers, provided that the Holding Company may
request changes to its shareholding structure (including, for the avoidance of
doubt, changes to the Legal Shareholders and/or the Shareholders) as disclosed
to and agreed by the Co-Arrangers prior to the date of such request, subject
always to the prior written consent of the Co-Arrangers (which shall not be
unreasonably withheld or delayed) and to the Co-Arrangers being satisfied as to
who is holding the ultimate beneficial ownership and control of the shares in
the Holding Company, and provided always that the Co-Arrangers receive a Letter
of Undertaking from any new ultimate beneficial shareholder.”;

 

(q)                                 by deleting Clause 11.16 and replacing it
with the following:

 

“11.16 Right of first and last refusal. Each of the Borrowers undertakes to give each
of the Co-Arrangers a right of first and last refusal for
arranging/underwriting up to 50% of the pre and post- delivery financing of
each of the Ships, and the Borrowers shall be bound to accept such offer of
financing provided that the same is (in the Borrowers’ opinion) the same as or
better than comparable offers of financing obtained by the Borrowers.”;

 

(r)                                    by inserting the following new clause as
Clause 11.18 thereof:

 

“11.18 Cash Collateral Account. The Borrowers undertake to ensure that,
throughout the Security Period, there shall be standing to the credit of the
Cash Collateral Account the sum of not less than $6,500,000 (the “Cash Collateral”). The Cash Collateral
shall remain blocked on the Cash Collateral Account until repayment or
prepayment of the Loan in full, whereupon it shall be released to the Borrowers
for application against remaining instalments due under the Shipbuilding
Contracts. Provided always that, upon the occurrence of an Event of Default,
the Cash Collateral shall be applied in the sole discretion of the
Co-Arrangers.”;

 

(s)                                  by inserting the following new clause as
Clause 11.19 thereof:

 

“11.19 Pre delivery financing. The Borrowers shall ensure that there is in
place a facility or facilities for the refinancing of the amount of the Loan
which comprises the First Instalment, the Second Instalment and the Third
Instalment under each Shipbuilding Contract for each Ship, not later than one
month prior to the final Repayment Date.”;

 

(t)                                    by inserting the following new clause as
Clause 11.20 thereof:

 

“11.20 Time Charters.

 

(a)                                  The Borrowers undertake to ensure that the
Owners shall enter into the Time Charters in respect of Ships, which Time
Charters shall remain in place throughout the Security Period.

 

(b)                                 The Borrowers further undertake that, should
any of the Owners enter into any time charter or consecutive voyage charter or
contract of affreightment in relation to any Ship (other than a Time Charter)
and which is of twelve (12) months or more in duration, or is capable of
exceeding twelve (12) months in duration, then the Borrowers shall procure that
the relevant Owner shall execute in favour of the Security Trustee an
assignment and notice of assignment (to be acknowledged by the relevant
counterparty) of such time charter or consecutive voyage charter or contract of
affreightment in such form and on such terms as the Time Charter Assignment,
and shall deliver to the Agent such other documents equivalent to

 

9

 

those referred to at
paragraphs 4, 5 and 6 of Part A of Schedule 4 hereof as the Agent may
require.”;

 

(u)                                 by
inserting the following new
clause as Clause 12.5 thereof:

 

“12.5
Market Value.

 

(a)                                  The
Market Value of a Ship shall be
determined by the Co-Arrangers in Dollars as the arithmetic average of the
valuations of two independent sale and purchase shipbrokers appointed jointly
by the Co-Arrangers and acceptable to the Lenders, which shall be prepared (i) taking
into account the resale value of such Ship, (ii) taking into account the
benefit of any charter of such Ship, (iii) with or without physical
inspection of such Ship (as the Agent may require) and (iv) as at a date
not more than fourteen (14) days previously.

 

(b)                                 The
Agent shall be entitled to request and obtain valuations of each Ship at any
time in order to determine the Market Value of each Ship provided that (unless a valuation is obtained whilst
an Event of Default has occurred and is continuing unremedied or unwaived) the
costs of such valuations shall not be borne by the Borrowers more than once for
each 12 month period.”;

 

(v)                                 by
inserting the following new sub-clause as Clause 15. l(n):

 

“(n)                           any of
the Time Charters is cancelled,
terminated, rescinded or suspended or otherwise ceases to remain in force for
whatsoever reason (other than by expiry through effluxion of time), unless the
Borrowers have provided to the Co-Arrangers a substitute time charter in a form
and substance acceptable to the Co-Arrangers in their sole discretion, and made
with a time charterer acceptable to the Co-Arrangers in their sole
discretion;”;

 

(w)                               by
inserting the following new clause as Clause 16.6 thereof:

 

“16.6                 Exit Fee. Within
thirty (30) days of the occurrence of a Trigger Event or (if payment is
deferred by the Lenders) the occurrence
of a subsequent Trigger Event, the Borrowers shall pay to the Lenders an amount
which is equal to ten per cent (10%) of the Net Asset Value of the relevant
Ship, which amount shall be calculated upon the date of payment of the Exit
Fee. For the purposes of this Clause 16.6:

 

(a)                                  “Trigger Event” shall mean:

 

(i)                                     the
sale of a Ship or the sale, novation, transfer or assignment of a Shipbuilding
Contract; or

 

(ii)                                  the
refinancing of the Loan in whole or in part (for example, the refinancing of
one or more Ships), unless the Lenders have been invited to participate in such
a refinancing and have chosen not to participate at the senior debt level; or

 

(iii)                               the
repayment of the Loan in whole or in part (including, for the avoidance of
doubt, repayment of the Loan on the Repayment Date); or

 

(iv)                              the
Total Loss of a Ship; or

 

(v)                                 the
sale or transfer of any of the shares in any of the Borrowers; or

 

10

 

(vi)                              the
cancellation, termination, rescission or suspension of a Shipbuilding Contract
relating to a Ship; or

 

(vii)                           the
acceleration of the Loan pursuant to the terms of this Agreement.

 

(b)                                 “Net
Asset Value” shall mean the higher of (i) the net sale proceeds (being
the sale proceeds less commissions and other reasonable expenses of the sale)
actually received by the owner of the relevant Ship or Shipbuilding Contract,
or the amount of the Loan refinanced or repaid, or the Total Loss proceeds of
the relevant Ship actually received by the owner of that Ship (or, if not
received within 90 days of the Total Loss, then the expected amount of the
Total Loss proceeds), or the amount of the consideration for the sale or
transfer of shares in the relevant Borrower (less any taxes and other
reasonable expenses of such sale or transfer incurred by or on behalf of the
relevant Borrower), or the net amount actually refunded by the Builder or
Refund Guarantor for cancellation, termination or rescission of the relevant
Shipbuilding Contract (or, if not received within 30 days of the said
cancellation, termination or rescission, then the expected amount to be
refunded) and (ii) the Market Value of the relevant Ship, PLUS in
each case (aa) the amount of trade receivables for the relevant Ship (due
within the next 30 days) and (bb) the amount of any interest rate hedging gains
attributable to the relevant Ship/Owner (provided such hedging was done in
conjunction with the relevant Ship), and MINUS in each case (cc) the aggregate
amount of debt (including interest, and including ordinary trade debt not older
than 30 days) which remains outstanding for the relevant Ship, net of one
fourth of the amount standing to the credit of the Cash Collateral Account,
(dd) the amount of any interest rate hedging losses attributable to the
relevant Ship/Owner (provided such hedging was done in conjunction with the
relevant Ship) on the due date of payment of the Exit Fee, (ee) any related
fees (other than the Exit Fee), default interest and other costs and expenses
which may have become due to the Lenders) and (ff) all amounts due to be paid
by the relevant Owner to the Builder under the Shipbuilding Contract relating
to the relevant Ship/Owner.

 

For the avoidance
of doubt:

 

(A)                              any
sums payable by the Borrowers to the Lenders by way of an Exit Fee shall be in
addition to any sums payable pursuant to the provisions of clause 8 of this
Agreement;

 

(B)                                should
the Lenders (in their sole discretion) defer payment of the Exit Fee to a date
subsequent to the final Repayment Date or subsequent to the date of refinancing
of the Loan, then the Borrowers undertake to ensure that the right of the
Lenders to receive payment of the Exit Fee is properly documented;

 

(C)                                upon
the occurrence of a Trigger Event, the Borrowers shall be obliged to obtain and
provide to the Lenders (at the cost and expense of the Borrowers) a valuation
of the relevant Ship or Ships, determined in accordance with the provisions of
Clause 12.5;

 

(D)                               in
circumstances where both Lenders are asked to participate in a refinancing of
whole or part of the Loan but only one chooses to do so (the “Remaining
Lender”), then the Remaining Lender shall be entitled to 50% of the amount of
the Exit Fee;

 

(E)                                 should
the Borrowers fail to pay the Exit Fee to the Lenders when due and payable by
the Lenders, then the Borrowers shall pay to the Lenders interest on the amount
of the Exit Fee from the said due date until the date of payment at the rate of
2% per annum, payable monthly.”;

 

11

 

(x)                                   by
construing all references therein to “this Agreement” where the context admits
as being references to “this Agreement as the same is amended and supplemented
by this Supplemental Agreement and as the same may from time to time be further
supplemented and/or amended”.

 

4.2                               In
consideration of the agreement of the Creditor Parties contained in Clause 2.1
of this Supplemental Agreement, the Borrowers hereby agree with the Creditor
Parties that the provisions of the Finance Documents shall, as of the date on
which the conditions precedent set out in Clause 3 have been complied with to
the satisfaction of the Agent, be varied and/or amended and/or supplemented as
follows:

 

(a)                                  the
definition of, and references throughout each of the Finance Documents to, the
Loan Agreement and any of the other Finance Documents shall be construed as if
the same referred to the Loan Agreement and those Finance Documents as amended
and supplemented by this Supplemental Agreement;

 

(b)                                 by
construing references throughout each of the Finance Documents to “this Agreement”, “this Deed”, “hereunder” and
other like expressions as if the same referred to such Finance Documents as
amended and supplemented by this Supplemental Agreement.

 

5                                         CONTINUANCE
OF LOAN AGREEMENT AND FINANCE DOCUMENTS

 

5.1                               Save
for the alterations to the Loan Agreement made or to be made pursuant to this
Supplemental Agreement and such further modifications (if any) thereto as may
be necessary to make the same consistent with the terms of this Supplemental
Agreement, the Loan Agreement shall remain in full force and effect.

 

5.2                               The
Finance Documents shall continue and remain valid and enforceable and in full
force and effect, as amended by:

 

(a)                                  the
amendments thereto contained or referred to in Clauses 4.1 and 4.2; and

 

(b)                                 such
further or consequential modifications as may be necessary to give full effect
to the terms of this Supplemental Agreement.

 

5.3                               For
the avoidance of doubt, the Creditor Parties confirm that once the Agreement
No.2 dated 3 April 2009 and made between (i) the Owners, (ii) Omniblue
Shipping Inc. and (iii) the Builder becomes effective in accordance with
the terms of clause 5 thereof, they shall release the relevant Borrowers from
their obligations under the Loan Agreement (as amended by the terms of this
Supplemental Agreement) and the Finance Documents to which they are parties.

 

6                                         REPRESENTATIONS
AND WARRANTIES

 

6.1                               Each
Borrower hereby jointly and severally represents and warrants to each of the
Creditor Parties, as at the date of this Supplemental Agreement, that the representations
and warranties set forth in Clause 10 of the Loan Agreement and in each of the
other Finance Documents to which it is a party (in each case updated mutatis
mutandis to the date of this Supplemental Agreement) are true and correct as if
all references therein to “this Agreement” were
references to the Loan Agreement as amended by this Supplemental Agreement.

 

12

 

6.2                               Each
Borrower hereby further jointly and severally represents and warrants to each
of the Creditor Parties that as at the date of this Supplemental Agreement:-

 

(a)                                  each
Borrower has full power to enter into and perform its obligations under this
Supplemental Agreement;

 

(b)                                 all
necessary governmental or other official consents, authorisations, approvals,
licences, consents or waivers for the execution, delivery, performance,
validity and/or enforceability of this Supplemental Agreement and all other
documents to be executed in connection with the amendments to the Loan
Agreement as contemplated hereby have been obtained and will (where
appropriate) be maintained in full force and effect throughout the Security
Period;

 

(c)                                  each
Borrower has taken all necessary corporate and other action to authorise the
execution, delivery and performance of its obligations under this Supplemental
Agreement and such other documents to which it is a party and such documents do
or will upon execution thereof constitute the valid and binding obligations of
each Borrower enforceable in accordance with their respective terms; and

 

(d)                                 the
execution, delivery and performance of this Supplemental Agreement and all such
other documents as contemplated hereby does not and will not during the
Security Period constitute a breach of any contractual restriction or any
existing applicable law, regulation, consent or authorisation binding on any
Borrower or on any of its property or assets and will not result in the
creation or imposition of any security interest, lien, charge or encumbrance
(other than under the Finance Documents) on any of such property or assets.

 

7                                         FURTHER
ASSURANCES

 

7.1                               The
Borrowers shall:

 

(a)                                  execute
and deliver to the Lenders (or as they may direct) any assignment, mortgage,
power of attorney, proxy or other document, governed by the laws of England or
such other country as the Lenders may, in any particular case, specify;

 

(b)                                 effect
any registration or notarisation or legalisation, give any notice or take any
other step,

 

which the Lenders
may, by notice to the Borrowers, specify for any of the purposes described in
Clause 7.2 or for any similar or related purpose.

 

7.2                               Those
purposes are:

 

(a)                                  validly
and effectively to create any Security Interest or right of any kind which the
Lenders intended should be created by or pursuant to the Loan Agreement or any
other Finance Document, each as amended and supplemented by this Agreement; and

 

(b)                                 implementing
the terms and provisions of this Supplemental Agreement,

 

provided always that the
right of the Lenders so to do has arisen and subsists pursuant to the terms of
the relevant document.

 

13

 

7.3                               Each
Borrower shall comply with a notice under Clause 7.1 by the date specified in
the notice, provided always that the right of the Lenders to do any of the things
described in Clause 7.2 has arisen and subsists pursuant to the terms of the
relevant document.

 

8                                         FEES
AND EXPENSES

 

8.1                               The
provisions of clause 16 (Fees and Expenses) of the Loan Agreement as regards
Expenses, as amended and supplemented by this Supplemental Agreement, shall
apply to this Supplemental Agreement as if they were expressly incorporated in
this Supplemental Agreement with any necessary modifications.

 

9                                         COMMUNICATIONS

 

9.1                               General.
The provisions of clause 24 (Notices) of the Loan Agreement, as amended and
supplemented by this Supplemental Agreement, shall apply to this Supplemental
Agreement as if they were expressly incorporated in this Supplemental Agreement
with any necessary modifications.

 

10                                  SUPPLEMENTAL

 

10.1                        Counterparts.  This Supplemental Agreement may be
executed in any number of counterparts.

 

10.2                        Third
party rights. A person who is not a party to this Supplemental 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 Supplemental Agreement.

 

11                                  LAW
AND JURISDICTION

 

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

 

11.2                        Incorporation
of the Loan Agreement provisions. The provisions of clause 27 (Law and
Jurisdiction) of the Loan Agreement, as amended and supplemented by this
Supplemental Agreement, shall apply to this Supplemental Agreement as if they
were expressly  incorporated  in 
this  Supplemental  Agreement 
with  any  necessary modifications.

 

IN
WITNESS WHEREOF  the
parties hereto have caused this Supplemental Agreement to be duly executed the
day and year first above written.

 

BORROWERS

 

	
  SIGNED by EFFIE P. PARASKEYOPOULOU

  	
  )

  	
   

  
	
  for and on behalf of

  	
  )

  	
  /s/ [Illegible]

  	
   

  
	
  SUEZ TURQUOISE LIMITED

  	
  )

  	
   

  
	
  in the presence of:  [Illegible]

  	
  )

  	
   

  

 

14

 

	
  SIGNED by  EFFIE
  P. PARASKEYOPOULOU

  	
  )

  	
   

  	
   

  
	
  for
  and on behalf of 

  	
  )

  	
  /s/ [Illegible]

  	
   

  
	
  SUEZ AMBER LIMITED

  	
  )

  	
   

  	
   

  
	
  in
  the presence of:  [Illegible]

  	
  )

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by EFFIE P. PARASKEYOPOULOU

  	
  )

  	
   

  	
   

  
	
  for
  and on behalf of 

  	
  )

  	
  /s/ [Illegible]

  	
   

  
	
  SUEZ CRYSTAL LIMITED

  	
  )

  	
   

  	
   

  
	
  in
  the presence of:  [Illegible]

  	
  )

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by EFFIE P. PARASKEYOPOULOU

  	
  )

  	
   

  	
   

  
	
  for
  and on behalf of 

  	
  )

  	
  /s/ [Illegible]

  	
   

  
	
  SUEZ TOPAZ LIMITED

  	
  )

  	
   

  	
   

  
	
  in
  the presence of:  [Illegible]

  	
  )

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by EFFIE P. PARASKEYOPOULOU

  	
  )

  	
   

  	
   

  
	
  for
  and on behalf of 

  	
  )

  	
  /s/ [Illegible]

  	
   

  
	
  SUEZ DIAMOND LIMITED

  	
  )

  	
   

  	
   

  
	
  in
  the presence of:  [Illegible]

  	
  )

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by EFFIE P. PARASKEYOPOULOU

  	
  )

  	
   

  	
   

  
	
  for
  and on behalf of 

  	
  )

  	
  /s/ [Illegible]

  	
   

  
	
  SUEZ JADE LIMITED

  	
  )

  	
   

  	
   

  
	
  in
  the presence of:  [Illegible]

  	
  )

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by EFFIE P. PARASKEYOPOULOU

  	
  )

  	
   

  	
   

  
	
  for
  and on behalf of 

  	
  )

  	
  /s/ [Illegible]

  	
   

  
	
  SUEZ PEARL LIMITED

  	
  )

  	
   

  	
   

  
	
  in
  the presence of:  [Illegible]

  	
  )

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by EFFIE P. PARASKEYOPOULOU

  	
  )

  	
   

  	
   

  
	
  for
  and on behalf of 

  	
  )

  	
  /s/ [Illegible]

  	
   

  
	
  SUEZ EMERALD LIMITED

  	
  )

  	
   

  	
   

  
	
  in
  the presence of:  [Illegible]

  	
  )

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by EFFIE P. PARASKEYOPOULOU

  	
  )

  	
   

  	
   

  
	
  for
  and on behalf of 

  	
  )

  	
  /s/ [Illegible]

  	
   

  
	
  SUEZ RUBY LIMITED

  	
  )

  	
   

  	
   

  
	
  in
  the presence of:  [Illegible]

  	
  )

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by EFFIE P. PARASKEYOPOULOU

  	
  )

  	
   

  	
   

  
	
  for
  and on behalf of 

  	
  )

  	
  /s/ [Illegible]

  	
   

  
	
  ALMA MARITIME LIMITED

  	
  )

  	
   

  	
   

  
	
  in
  the presence of:  [Illegible]

  	
  )

  	
   

  	
   

  

 

15

 

	
  LENDERS

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for
  and on behalf of  

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  FORTIS BANK

  	
  )

  	
   

  	
   

  	
   

  
	
  in
  the presence of:  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for
  and on behalf of  

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  BAYERISCHE
  HYPO-UND 

  VEREINSBANK AG

  	
  )

  )

  	
   

  	
   

  	
   

  
	
  in
  the presence of:  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CO-ARRANGERS

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for
  and on behalf of  

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  FORTIS BANK

  	
  )

  	
   

  	
   

  	
   

  
	
  in
  the presence of:  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for
  and on behalf of   

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  BAYERISCHE
  HYPO-UND 

  VEREINSBANK AG

  	
  )

  )

  	
   

  	
   

  	
   

  
	
  in
  the presence of:  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CO-UNDERWRITERS

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for
  and on behalf of   

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  FORTIS BANK

  	
  )

  	
   

  	
   

  	
   

  
	
  in
  the presence of:  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for
  and on behalf of  

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  BAYERISCHE
  HYPO-UND 

  VEREINSBANK AG

  	
  )

  )

  	
   

  	
   

  	
   

  
	
  in
  the presence of:  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  AGENT

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for
  and on behalf of  

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  FORTIS BANK

  	
  )

  	
   

  	
   

  	
   

  
	
  in
  the presence of:  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  

 

16

 

	
  SECURITY TRUSTEE

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  
	
  for
  and on behalf of  

  	
  )

  	
  /s/ [Illegible]

  	
   

  	
  /s/ [Illegible]

  
	
  FORTIS BANK

  	
  )

  	
   

  	
   

  	
   

  
	
  in
  the presence of:  [Illegible]

  	
  )

  	
   

  	
   

  	
   

  

 

 

	
  JEREMY M. WATSON

  	
   

  
	
  SOLICITOR

  	
   

  
	
  CONSTANT &
  CONSTANT

  	
   

  
	
  2, DEFTERAS
  MERARCHIAS

  	
   

  
	
  PIRAEUS 18536 -
  GREECE

  	
   

  

 

17

 

SCHEDULE 1

 

BORROWERS

 

	
  Name

  	
   

  	
  Country of Incorporation

  	
   

  	
  Registered Address

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Suez Turquoise Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Suez Amber Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex 

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Suez Crystal Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex 

  Ajeltake Road 

  Ajeltake Island, Majuro

  The Marshall Islands 

  MH 96960

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Suez Topaz Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex 

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Suez Diamond Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex 

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Suez Jade Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex 

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Suez Pearl Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex 

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Suez Emerald Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex 

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  

 

18

 

	
  Suez Ruby Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Alma Maritime Limited

  	
   

  	
  Marshall Islands

  	
   

  	
  Trust Company Complex 

  Ajeltake Road 

  Ajeltake Island, Majuro 

  The Marshall Islands 

  MH 96960

  

 

19

 

SCHEDULE 2

 

LENDERS AND COMMITMENTS

 

	
  Lender

  	
   

  	
  Lending
  Office

  	
   

  	
  Commitment

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fortis
  Bank

  	
   

  	
  166
  Syngrou Avenue 

  176 71 Athens 

  Greece

  	
   

  	
  $

  	
  55,800,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bayerische Hypo-und Vereinsbank AG

  	
   

  	
  7
  Heraklitou Street 

  GR 10673 Athens 

  Greece

  	
   

  	
  $

  	
  55,800,000

  	
   

  

 

20

 

SCHEDULE 3

 

DEED OF RELEASE

 

Dated                                     2009

 

BY :                         (1)                                  Fortis
Bank, acting through its lending office at 166 Syngrou Avenue, 1761 71 Athens,
Greece

 

(in its capacities as
Lender, Agent, Security Trustee, Co-Arranger and Co-Underwriter “FORTIS BANK”); and

 

(2)                                  Bayerische
Hypo-und Vereinsbank AG acting through its lending office at 7 Heraklitos
Street, GR 106 73 Athens, Greece

 

(in its capacities as
Lender, Co-Arranger and Co-Underwriter, “BAYERISCHE
HYPO-UND VEREINSBANK AG”).

 

IN
FAVOUR OF:      Mr. Gavriil
Panagiotidis of 17th Km National Road Athens-Lamia and Finikos
Street, 145 64 Kifissia, Greece (“Panagiotidis”)

 

WHEREAS

Pursuant to the Loan
Agreement dated 23rd June 2008 (as amended by side letters
dated 12 March 2009, 31 March 2009 and 24 April 2009
respectively) (collectively the “Loan
Agreement”) made between (1) the companies listed in Schedule 1
thereto as joint and several Borrowers (the “Borrowers”),
(2) Fortis Bank and Bayerische Hypo-und Vereinsbank AG as
Lenders (the “Lenders”), (3) Fortis
Bank and Bayerische Hypo-und Vereinsbank AG as Co-Arrangers and Co-Underwriters
and (4) Fortis Bank as Agent and Security Trustee, in relation to a
secured bridge facility of up to US$111,600,000 to finance part of the first
instalment due to the Builder in respect of nine (9) 158,460 dwt suezmax
tanker newbuildings (the “Ships”) under
construction for the Borrowers by the Builder in Korea pursuant to the
Shipbuilding Contracts, you have provided Fortis Bank and Bayerische Hypo-und
Vereinsbank AG with the Letter of Undertaking dated 23 June 2008 (as
amended by a side letter dated 24 April 2009) (collectively the “Letter of Undertaking”).

 

THIS
DEED WITNESSES as follows:

 

1.              Release

 

FORTIS BANK AND
BAYERISCHE HYPO-UND VEREINSBANK AG (in the capacities in which they appear in
this Deed), with effect from the date hereof, hereby irrevocably and
unconditionally, release and agree to release Panagiotidis and discharge
Panagiotidis from all obligations, undertakings and liabilities to FORTIS BANK
AND BAYERISCHE HYPO-UND VEREINSBANK AG arising from or connected with the
Letter of Undertaking which is deemed to be cancelled without any effect whatsoever.

 

FORTIS BANK AND
BAYERISCHE HYPO-UND VEREINSBANK AG further hereby irrevocably and
unconditionally confirm and agree that they have no claim against Panagiotidis
for any cause whatsoever (including but not limited to any claim out of any act
or omission of the Holding Company and/or the Borrowers and/or the legal or
beneficial shareholders of the

 

21

 

Holding Company) and in
any event they hereby irrevocably and unconditionally waive any such claim against
Panagiotidis.

 

Words and expressions
defined in the Letter of Undertaking shall have the same meaning when used
herein.

 

This Deed and any
contractual or non-contractual obligations connected with it shall be governed
and construed in accordance with English law.

 

IN WITNESS of which this
Deed has been duly executed and delivered as a deed the day and year first
above written.

 

 

	
  SIGNED by

  	
  )

  
	
  for
  and on behalf of

  	
  )

  
	
  FORTIS BANK

  	
  )

  
	
  in
  its capacity as Lender

  	
  )

  
	
  pursuant
  to the power of attorney

  	
  )

  
	
  dated

  	
  )

  
	
  in
  the presence of:

  	
  )

  
	
   

  	
   

  
	
   

  	
   

  
	
  SIGNED by

  	
  )

  
	
  for
  and on behalf of

  	
  )

  
	
  BAYERISCHE HYPO-UND VEREINSBANK
  AG

  	
  )

  
	
  in
  its capacity as Lender

  	
  )

  
	
  pursuant
  to the power of attorney

  	
  )

  
	
  dated

  	
  )

  
	
  in
  the presence of:

  	
  )

  
	
   

  	
   

  
	
   

  	
   

  
	
  SIGNED by

  	
  )

  
	
  for
  and on behalf of

  	
  )

  
	
  FORTIS BANK

  	
  )

  
	
  in
  its capacities as Co-Arranger and Co-Underwriter

  	
  )

  
	
  pursuant
  to the power of attorney

  	
  )

  
	
  dated

  	
  )

  
	
  in
  the presence of:

  	
  )

  
	
   

  	
   

  
	
   

  	
   

  
	
  SIGNED by

  	
  )

  
	
  for
  and on behalf of

  	
  )

  
	
  BAYERISCHE HYPO-UND VEREINSBANK
  AG

  	
  )

  
	
  in
  its capacities as Co-Arranger and Co-Underwriter

  	
  )

  
	
  pursuant
  to the power of attorney

  	
  )

  
	
  dated

  	
  )

  
	
  in
  the presence of:

  	
  )

  

 

22

 

	
  SIGNED by

  	
  )

  
	
  for
  and on behalf of

  	
  )

  
	
  FORTIS BANK

  	
  )

  
	
  in
  its capacity as Agent

  	
  )

  
	
  pursuant
  to the power of attorney

  	
  )

  
	
  dated

  	
  )

  
	
  in
  the presence of:

  	
  )

  
	
   

  	
   

  
	
   

  	
   

  
	
  SIGNED by

  	
  )

  
	
  for
  and on behalf of

  	
  )

  
	
  FORTIS BANK

  	
  )

  
	
  in
  its capacity as Security Trustee

  	
  )

  
	
  pursuant
  to the power of attorney

  	
  )

  
	
  dated

  	
  )

  
	
  in
  the presence of:

  	
  )

  
	
   

  	
   

  
	
   

  	
   

  
	
  Witness
  to each of the above signatures:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Signature
  of witness

  	
   

  
	
   

  	
   

  
	
  Name:

  	
   

  
	
  Address:

  	
   

  
			

 

23

 

SCHEDULE 4

 

ACCOUNT PLEDGE

 

24

 

FEE LETTER

 

	
  From:

  	
   

  	
  Suez Turquoise Limited

  Suez Amber Limited

  Suez Crystal Limited

  Suez Topaz Limited

  Suez Diamond Limited

  Suez Jade Limited

  Suez Pearl Limited

  Suez Emerald Limited

  Suez Ruby Limited

  Alma Maritime Limited

  
	
   

  	
   

  	
   

  
	
  To:

  	
  (1)

  	
  Fortis Bank

  166 Syngrou Avenue

  176 71 Athens

  Greece

  
	
   

  	
   

  	
   

  
	
   

  	
  (2)

  	
  Bayerische Hypo-und Vereinsbank AG

  7 Heraklitou Street

  GR 106 73, Athens

  Greece

  

 

23 June 2008

 

Dear Sirs

 

Hull
No.’s 2297/2298/2299/2300/2301/2302/2303/2304/2305

 

We refer to a facility
agreement of even date herewith (the “Facility
Agreement”) in respect of a bridging facility of up to
US$111,600,000 (the  “Facility”) made between (1) ourselves
as joint and several Borrowers, (2) the banks and financial institutions
listed in Schedule 2 thereof as Lenders, (3) yourselves as Co-Arrangers
and Co-Underwriters and (4) Fortis Bank as Agent and Security Trustee.

 

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

 

In consideration of your
agreeing to enter into the Facility Agreement today, we hereby undertake to pay
to you:

 

(a)                                  an
arrangement fee of $948,600 for distribution amongst the Lenders pro rata to
their Commitments/participations, payable upon signing of the Facility
Agreement; and

 

(b)                                 quarterly
in arrears during the period from (and including) 5 June 2008 to the
Drawdown Date, for the account of the Lenders, a commitment fee at the rate of
zero point three five per cent (0.35%) per annum on the amount of the Total
Commitments less the amount of the Loan, for distribution to the Lenders pro
rata to their Commitments.

 

We hereby acknowledge
that a failure to pay the aforementioned fees (or any of them) when due shall
constitute an Event of Default.

 

 

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

 

 

	
  /s/ [Illegible]

  	
   

  
	
  

  For and on behalf of

  	
   

  
	
  SUEZ
  TURQUOISE LIMITED

  SUEZ AMBER LIMITED

  SUEZ CRYSTAL LIMITED

  SUEZ TOPAZ LIMITED

  SUEZ DIAMOND LIMITED

  SUEZ JADE LIMITED

  SUEZ PEARL LIMITED

  SUEZ EMERALD LIMITED

  SUEZ RUBY LIMITED

  ALMA MARITIME LIMITED

  	
   

  
	
   

  	
   

  
	
  Accepted and agreed:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ [Illegible]

  	
   

  
	
  

  For and on behalf of

  	
   

  
	
  FORTIS
  BANK

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ [Illegible]

  	
   

  
	
  

  For and on behalf of

  	
   

  
	
  BAYERISCHE HYPO-UND VEREINSBANK AG

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated: 23
  June 2008

  	
   

  

 

2Exhibit 10.7

 

ALMA MARITIME LIMITED

 

2010 EQUITY INCENTIVE PLAN

 

1.             Purpose of the Plan

 

The purpose of this 2010 Equity Incentive Plan (the “Plan”) is to
advance the interests of the Company and its stockholders by providing a means (a) to
attract, retain, and reward directors, officers, other employees, and persons
who provide services to the Company and its Subsidiaries, and directors,
officers and employees of any Management Company, (b) to link compensation
to measures of the Company’s performance in order to provide additional
incentives, including stock-based incentives and cash-based incentives, to such
persons for the creation of stockholder value, and (c) to enable such
persons to acquire or increase a proprietary interest in the Company in order to
promote a closer identity of interests between such persons and the Company’s
stockholders.

 

2.             Definitions

 

Capitalized
terms used in the Plan and not defined elsewhere in the Plan shall have the
meaning set forth in this Section.

 

2.1           “Award” means a
compensatory award made pursuant to the Plan pursuant to which a Participant
receives, or has the opportunity to receive Shares or cash.

 

2.2           “Beneficiary”
means the person(s) or trust(s) entitled by will or the laws of
descent and distribution to receive any rights with respect to an Award that
survive such Participant’s death, provided that if at the time of a
Participant’s death, the Participant had on file with the Committee a written
designation of a person(s) or trust(s) to receive such rights, then
such person(s) (if still living at the time of the Participant’s death) or
trust(s) shall be the “Beneficiary” for purposes of the Plan.

 

2.3           “Board” means
the Board of Directors of the Company.

 

2.4           “Change of
Control” shall mean the occurrence of any of the following:

 

(a)           any “person”
(as such term is used in sections 3(a)(9) and 13(d) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”)) or “group” (within the
meaning of section 13(d)(3) of the Exchange Act), other than (i) the
Company, or (ii) MK Maritime LLC, Maas Capital or Gallery Services Ltd.
(the “MMG Entities”) or entities each of the MMG Entities directly or
indirectly control (as defined in Rule 12b-2 under the Exchange Act),
acquiring “beneficial ownership” (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of more than fifty percent (50%) of the
Voting Stock of the Company;

 

(b)           the sale of all
or substantially all of the Company’s assets in one or more related
transactions to a “person” (as such term is used in sections 3(a)(9) and
13(d) of the Exchange Act) other than such a sale (x) to a subsidiary
of the Company which does not involve a change in the equity holdings of the
Company or (y) to the MMG Entities or entities each of the MMG Entities
directly or indirectly control;

 

1

 

(c)           any merger,
consolidation, reorganization or similar event of the Company, as a result of
which the holders of the Voting Stock of the Company immediately prior to such
merger, consolidation, reorganization or similar event do not directly or
indirectly hold at least fifty-one percent (51%) of the Voting Stock of the
surviving entity;

 

(d)           a majority of
the members of the Board of Directors are no longer Continuing Directors; as
used herein, a “Continuing Director” means any member of the Board of Directors
who was a member of such Board of Directors on the date hereof and any person
who becomes a director subsequent to such date whose election or nomination for
election was supported by a majority of the directors who then comprised the
Continuing Directors; or

 

(e)           the Company
adopts any plan of liquidation or dissolution providing for the distribution of
all or substantially all of its assets.

 

For purposes of the Change of Control definition, the “Company” shall include any entity that succeeds to all or substantially all of the business of the Company and “Voting Stock” shall mean capital stock of any class or classes having general voting power, in the absence of specified contingencies, to elect the directors of a corporation.
 

2.5           “Code” means
the Internal Revenue Code of 1986, as amended, including regulations thereunder
and successor provisions and regulations thereto.

 

2.6           “Committee”
means the Compensation Committee of the Board, or another committee appointed
by the Board to administer the Plan or any part thereof, or the Board, where
the Board is acting as the Committee or performing the functions of the
Committee, as set forth in Section 3.

 

2.7           “Company” means
Alma Maritime Limited, a corporation organized under the laws of the Republic
of Marshall Islands.

 

2.8           “Effective Date”
means the date the Plan is approved by the Company’s stockholders.

 

2.9           “Exchange Act”
means the Securities Exchange Act of 1934, as amended.

 

2.10         “Management
Company” means any company that is providing administrative, commercial,
technical or maritime services to, or for the benefit of, the Company, its
Subsidiaries and their vessels.

 

2.11         “Non-Employee
Director” means a member of the Board who is not employed by the Company or any
Subsidiary or any Management Company.

 

2.12         “Participant”
means any employee, director, or other service provider who has been granted an
Award under the Plan.

 

2.13         “Shares” means
shares of common stock of the Company and such other securities as may be
substituted or resubstituted for Shares pursuant to Section 6.

 

2.14         “Subsidiary”
means an entity that is, either directly or through one or more intermediaries,
controlled by the Company, as determined by the Committee.

 

2

 

3.             Administration

 

3.1           Committee.  The Plan shall be administered by the
Committee.  Other provisions of the Plan
notwithstanding, the Board may perform any function of the Committee under the
Plan, and that authority specifically reserved to the Board under the terms of
the Plan, the Company’s Articles of Incorporation, By-Laws, or applicable law
shall be exercised by the Board and not by the Committee.  The Board shall serve as the Committee in respect
of any Awards made to any Non-Employee Director.

 

3.2           Powers
and Duties of Committee.  In
addition to the powers and duties specified elsewhere in the Plan, the
Committee shall have full authority and discretion to:

 

(a)           adopt, amend,
suspend, and rescind such rules and regulations and appoint such agents as
the Committee may deem necessary or advisable to administer the Plan;

 

(b)           correct any
defect or supply any omission or reconcile any inconsistency in the Plan,
construe and interpret the Plan, any Award, any rules and regulations
hereunder, or other instrument hereunder, and correct any defect or
inconsistency with the terms of the Plan with respect to any Award hereunder;

 

(c)           make
determinations relating to eligibility for and entitlements in respect of
Awards, and to make all factual findings related thereto; and

 

(d)           make all other
decisions and determinations as may be required under the terms of the Plan or
as the Committee may deem necessary or advisable for the administration of the
Plan.

 

All
determinations and decisions of the Committee shall be final and binding upon a
Participant or any person claiming any rights under the Plan from or through
any Participant, and the Participant or such other person may not further
pursue his or her claim in any court of law or equity or other arbitral
proceeding.

 

3.3           Delegation
by Committee.  The
Committee may delegate, on such terms and conditions as it determines in its
sole and absolute discretion, to a sub-committee or to one or more officers of
the Company, all or any portion of its authority, to the extent consistent with
applicable law, including section 16 of the Exchange Act, and the applicable rules of
any stock exchange.  Any such allocation
or delegation may be revoked by the Committee at any time.

 

3.4           Limitation
of Liability.  Each member
of the Committee shall be entitled to, in good faith, rely or act upon any
report or other information furnished to him or her by any officer or other
employee of the Company or any Subsidiary, the Company’s independent registered
public accounting firm, or any executive compensation consultant, legal
counsel, or other professional retained by the Company to assist in the
administration of the Plan.  No member of
the Committee, nor any officer or employee of the Company acting on behalf of
the Committee, shall be personally liable for any action, determination, or
interpretation taken or made in good faith with respect to the Plan, and all
members of the Committee and any officer or employee of the Company acting on
behalf of the Committee shall, to the extent permitted by law, be fully
indemnified and protected by the Company with respect to any such action,
determination, or interpretation.

 

3

 

4.             Limitations on Awards

 

4.1           Aggregate
Number of Shares Available for Awards.  The aggregate number of Shares for which
Awards may be granted under this Plan shall not exceed 1,500,000.  Awards made under this Plan which are
forfeited (including a repurchase or cancellation of Shares subject thereto by
the Company in exchange for the price, if any, paid to the Company for such
Shares, or for their par or other nominal value), cancelled or have expired,
shall be disregarded for purposes of the preceding sentence.

 

4.2           Type of
Shares Deliverable.  The Shares
delivered in connection with Awards may consist, in whole or in part, of
authorized and unissued Shares, or Shares acquired in the market for the
account of a Participant.

 

5.             Awards

 

5.1           Eligibility.  The Committee shall have the discretion to
select Award recipients from among the following categories of eligible
recipients: (a) individuals who are employees (including officers) of the
Company or any Subsidiary or any Management Company, (b) persons who
provide services to the Company or any Subsidiary who are not otherwise
employed by the Company, (c) any individual who has agreed to become an
employee of the Company or a Subsidiary or any Management Company, provided
that no such person may receive any payment or exercise any right relating to
an Award until such person has commenced employment, and (d) Non-Employee
Directors.

 

5.2           Type of
Awards.  The Committee shall have the
discretion to determine the type of Award to be granted to a Participant.  Such Awards may be in a form payable in
either Shares or cash, including, but not limited to, options to purchase
Shares, restricted Shares, bonus Shares, appreciation rights, share units and
performance units.  The Committee is
authorized to grant Awards as a bonus, or to grant Awards in lieu of
obligations of the Company or any Subsidiary to pay cash or grant other awards
under other plans or compensatory arrangements, to the extent permitted by such
other plans or arrangements. Shares issued pursuant to an Award in the nature
of a purchase right (e.g., options) shall be purchased for such consideration,
paid for at such times, by such methods, and in such forms, including cash,
Shares, other Awards, or other consideration, as the Committee shall determine.

 

5.3           Terms
and Conditions of Awards.  The Committee
shall determine the size of each Award to be granted (including, where
applicable, the number of Shares to which an Award will relate, and all other
terms and conditions of each such Award (including, but not limited to, any
exercise price, grant price, or purchase price, any restrictions or conditions
relating to transferability, forfeiture, exercisability, or settlement of an
Award, any schedule or performance conditions for the lapse of such
restrictions or conditions, and accelerations or modifications thereof, based
in each case on such considerations as the Committee shall determine, and any
expiration date).  The Committee may
determine whether, to what extent, and under what circumstances an Award may be
settled, or the exercise price of an Award may be paid, in cash, Shares, other
Awards, or other consideration, or an Award may be canceled, forfeited, or
surrendered.  The right of a Participant
to exercise or receive a grant or settlement of any Award, and the timing
thereof, may be subject to such performance conditions as may be specified by
the Committee.  The Committee may use
such business criteria and measures of performance as it may deem appropriate
in establishing performance conditions, and may exercise its discretion to
reduce or increase the amounts payable under any Award subject to performance
conditions.

 

5.4           Option
Repricing. 
Notwithstanding anything in the Plan to the contrary, the Committee may
not reprice stock options or stock appreciation rights, nor may the Board amend
the Plan to permit repricing of stock options or stock appreciation rights,
unless the stockholders of the Company provide prior approval for such
repricing.  The term “repricing” shall
have the meaning given that term in section 

 

4

 

303A.08
of the New York Stock Exchange Listed Company Manual, as in effect from time to
time,  and shall not include adjustments
pursuant to Section 6 of the Plan.

 

5.5           Stand-Alone,
Additional, Tandem, and Substitute Awards.  Subject to Section 5.4, Awards granted
under the Plan may, in the discretion of the Committee, be granted either alone
or in addition to, in tandem with, or in substitution or exchange for, any
other Award or any award granted under another plan of the Company, any
Subsidiary, any Management Company, or any business entity to be acquired by
the Company or a Subsidiary, or any other right of a Participant to receive
payment from the Company or any Subsidiary, and in granting a new Award, the
Committee may determine that the value of any surrendered Award or award may be
applied to reduce the exercise price of any stock option or stock appreciation
right or purchase price of any other Award.

 

5.6           Vesting
Upon a Change of Control. 
Unless otherwise set forth in an Award notice (as described in Section 5.7),
Awards will vest upon a Change of Control, and any time periods, conditions or
contingencies relating to the exercise or realization of, or lapse of
restrictions under, any Award shall be automatically accelerated or waived so
that if no exercise of the Award is required, the Award may be realized in full
at the time of the occurrence of the Change of Control or if exercise of the
Award is required, the Award may be exercised at the occurrence of the Change
of Control.

 

5.7           Award
Notice.  The Committee shall cause each
Participant to be notified of each Award hereunder and the terms thereof
pursuant to such means as the Committee may determine.  The Committee may, but shall not be obligated
to, require that a Participant enter into an agreement evidencing any Award
hereunder.

 

6.             Adjustments

 

If there is any change in the number or kind of Shares outstanding (a) by
reason of a stock dividend, spinoff, recapitalization, stock split, or combination
or exchange of Shares, (b) by reason of a merger, reorganization or
consolidation, (c) by reason of a reclassification or change in par value,
or (d) by reason of any other extraordinary or unusual event effecting the
Company’s outstanding capital stock without the Company’s receipt of
consideration, or if the value of outstanding Shares is substantially reduced
as a result of a spinoff or the Company’s payment of an extraordinary dividend
or distribution, the maximum number of Shares available for issuance under the
Plan, the kind and number of Shares covered by outstanding Awards, the kind and
number of Shares issued and to be issued under the Plan, and the price per
Share or the applicable market value of such Awards and the exercise price,
grant price or purchase price relating to any Award shall be equitably adjusted
by the Committee to reflect any increase or decrease in the number of, or
change in the kind or value of, the issued shares of Company capital stock to
preclude, to the extent practicable, the enlargement or dilution of rights and
benefits under the Plan and such outstanding Awards; provided, however,
that any fractional shares resulting from such adjustment shall be
eliminated.  In addition, the Committee
is authorized to make adjustments in the terms and conditions of, and the
criteria included in, Awards (including cancellation of Awards in exchange for
the intrinsic (i.e., in-the-money) value, if any, of the vested portion
thereof, substitution of Awards using securities or other obligations of a
successor or other entity, acceleration of the expiration date for Awards, or
adjustment to performance goals in respect of Awards) in recognition of unusual
or nonrecurring events (including, without limitation, a Change of Control,
events described in the preceding sentence, and acquisitions and dispositions
of businesses and assets) affecting the Company, any Subsidiary or any business
unit, or the financial statements of the Company or any Subsidiary, or in
response to changes in applicable laws, regulations, or accounting
principles.  In addition, in the event of
a Change of Control of the Company, the provisions of Section 5.6 of the
Plan shall apply.  Any adjustments
determined by the Committee shall be final, binding and conclusive.

 

5

 

7.             General Provisions

 

7.1           Compliance
with Laws and Obligations.  The
Company shall not be obligated to issue or deliver Shares in connection with
any Award or take any other action under the Plan in a transaction subject to
the registration requirements of any applicable securities law, any requirement
under any listing agreement between the Company and any securities exchange or
automated quotation system, or any other law, regulation, or contractual obligation
of the Company, until the Company is satisfied that such laws, regulations, and
other obligations of the Company have been complied with in full.  Shares issued under the Plan will be subject
to such stop-transfer orders and other restrictions as may be applicable under
such laws, regulations, and other obligations of the Company, including any
requirement that a legend or legends be placed thereon.

 

7.2           Limitations
on Transferability.  Awards and
other rights under the Plan will not be transferable by a Participant except to
a Beneficiary in the event of the Participant’s death (to the extent any such
Award, by its terms, survives the Participant’s death), and, if exercisable,
shall be exercisable during the lifetime of a Participant only by such Participant
or his guardian or legal representative; provided, however, that,
if and only to the extent permitted by the Committee, Awards and other rights
hereunder may be transferred during the lifetime of the Participant, for
purposes of the Participant’s estate planning or other purposes consistent with
the purposes of the Plan (as determined by the Committee), and may be exercised
by such transferees in accordance with the terms of such Award.  Awards and other rights under the Plan may
not be pledged, mortgaged, hypothecated, or otherwise encumbered, and shall not
be subject to the claims of creditors.  A
Beneficiary, transferee, or other person claiming any rights under the Plan
from or through any Participant shall be subject to all terms and conditions of
the Plan and any Award applicable to such Participant, except as otherwise
determined by the Committee, and to any additional terms and conditions deemed
necessary or appropriate by the Committee.

 

7.3           No
Right to Continued Employment; Leaves of Absence.  Neither the Plan, the grant of any Award, nor
any other action taken hereunder shall be construed as giving any employee,
consultant, director, or other person the right to be retained in the employ or
service of the Company, any of its Subsidiaries or any Management Company (for
the vesting period or any other period of time), nor shall it interfere in any
way with the right of the Company or any of its Subsidiaries or the right of
any Management Company, to terminate any person’s employment or service at any
time.  Unless otherwise specified with
respect to an applicable Award, (a) an approved leave of absence shall not
be considered a termination of employment or service for purposes of an Award
under the Plan, (b) any Participant who is employed by or performs
services for a Subsidiary shall be considered to have terminated employment or
service for purposes of an Award under the Plan if such Subsidiary is sold or
no longer qualifies as a Subsidiary of the Company, unless such Participant
remains employed by the Company or another Subsidiary, and (c) any
Participant who is employed by, or serves as a director of, a Management
Company shall be considered to have terminated employment or service for
purposes of an Award under the Plan if such Management Company no longer
provides services to the Company.

 

7.4           Taxes.  The Company and any Subsidiary is authorized
to withhold from any delivery of Shares in connection with an Award, any other
payment relating to an Award, or any payroll or other payment to a Participant,
amounts of withholding and other taxes due or potentially payable in connection
with any transaction involving an Award, and to take such other action as the
Committee may deem advisable to enable the Company, its Subsidiaries and
Participants to satisfy obligations for the payment of withholding taxes and
other tax obligations relating to any Award. 
This authority shall include authority to withhold or receive Shares or
other consideration and to make cash payments in respect thereof in satisfaction
of withholding tax obligations.

 

6

 

7.5           Changes
to the Plan and Awards.  The
Board may amend, suspend, discontinue, or terminate the Plan, any provision
thereof, or the Committee’s authority to grant Awards under the Plan without
the consent of stockholders or Participants, except that any amendment shall be
subject to the approval of the Company’s stockholders, in accordance with the
Company’s Articles of Incorporation, at or before the next annual meeting of
stockholders for which the record date is after the date of such Board action
if such stockholder approval is required by the Company’s Articles of
Incorporation or any applicable law, regulation or stock exchange rule.  The Board may otherwise, in its discretion,
determine to submit other such amendments to stockholders for approval.  Without the consent of an affected
Participant, no amendment, suspension, discontinuation, or termination of the
Plan may materially impair the rights of such Participant under any Award
theretofore granted.  The Committee may
amend, suspend, discontinue, or terminate any Award theretofore granted; provided,
however, that, without the consent of an affected Participant, no such
action may materially impair the rights of such Participant under such
Award.  Unless the Plan is terminated
earlier by the Board, the Plan shall terminate on the day immediately preceding
the tenth anniversary of its Effective Date. 
The termination of the Plan shall not impair the power and authority of
the Committee with respect to an outstanding Award.  Any action taken by the Committee pursuant to
Section 6 shall not be treated as an action described in this Section 7.5.  Notwithstanding anything in the Plan to the
contrary, the Board may amend the Plan and Awards in such manner as it deems
appropriate in the event of a change in applicable law or regulations.

 

7.6           No
Right to Awards; No Stockholder Rights.  No Participant or other person shall have any
claim to be granted any Award under the Plan, and there is no obligation for
uniformity of treatment of Participants, employees, directors, and other
service providers.  No Award shall confer
on any Participant any of the rights of a stockholder of the Company unless and
until Shares are duly issued or transferred and delivered to the Participant in
accordance with the terms of the Award.

 

7.7           Unfunded
Status of Awards; Creation of Trusts.  The Plan is intended to constitute an “unfunded”
plan for incentive compensation.  With
respect to any payments not yet made to a Participant pursuant to an Award,
nothing contained in the Plan or any Award shall give any such Participant any
rights that are greater than those of a general creditor of the Company; provided,
however, that the Committee may authorize the creation of trusts or make
other arrangements to meet the Company’s obligations under the Plan to deliver
cash, Shares, other Awards, or other consideration pursuant to any Award, which
trusts or other arrangements shall be consistent with the “unfunded” status of
the Plan unless the Committee otherwise determines.

 

7.8           Nonexclusivity
of the Plan.  Neither the
adoption of the Plan by the Board nor the submission of the Plan or of any
amendment to stockholders for approval shall be construed as creating any
limitations on the power of the Board to adopt such other compensatory
arrangements as it may deem desirable, including the granting of awards
otherwise than under the Plan, and such arrangements may be either applicable
generally or only in specific cases.

 

7.9           Successors
and Assigns.  The Plan
and Awards may be assigned by the Company to any successor to the Company’s
business.  The Plan and any Awards shall
be binding on all successors and assigns of the Company and a Participant,
including any permitted transferee of a Participant, the Beneficiary or estate
of such Participant and the executor, administrator or trustee of such estate,
or any receiver or trustee in bankruptcy or representative of the Participant’s
creditors.

 

7.10         Governing
Law. The Plan and all Awards shall be governed by and construed in
accordance with the laws of the Republic of the Marshall Islands, without
giving effect to any choice of law or conflict of law provision or rule that
would cause the application of the laws of any jurisdiction other than the
Republic of the Marshall Islands.

 

7

 

7.11         Severability
of Provisions.  If any
provision of the Plan shall be held invalid or unenforceable, such invalidity
or unenforceability shall not affect any other provisions hereof, and the Plan
shall be construed and enforced as if such provisions had not been included.

 

8

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