Document:

Exhibit 4.15

	
  

 
	
 Private
& Confidential 

 
	
 FACILITY AGREEMENT

 
	
 for a

 
	
 Loan of up to US$203,343,000

 
	
 and a Guarantee Facility of up to $28,856,781

 
	
 to

 
	
 ADELE SHIPPING CO.

 
	
 BASTIAN SHIPPING CO.

 
	
 and

 
	
 CADENCE SHIPPING CO.

 
	
  

 
	
 provided by

 
	
 THE BANKS AND FINANCIAL INSTITUTIONS SET OUT IN SCHEDULE 1

 
	
  

 
	
 Mandated Co-Lead Arrangers

 
	
 THE EXPORT-IMPORT BANK OF CHINA

 
	
 and

 
	
 DNB NOR BANK ASA

 
	
  

 
	
 Agent, Security Agent, Account Bank and Swap Provider

 
	
 DNB NOR BANK ASA

 
	
  

 
	
 Issuing Bank

 
	
 THE EXPORT-IMPORT BANK OF CHINA

 
	
  

 
	
 

 

Contents

	
  

 	
  

 	
  

 
	
 Clause

 	
  

 	
 Page

 
	
  

 	
  

 	
  

 
	
 1

 	
 Purpose
 and definitions

 	
 1

 
	
  

 	
  

 	
  

 
	
 2

 	
 The
 Total Commitment, the Advances and the Bank Guarantees

 	
 24

 
	
  

 	
  

 	
  

 
	
 3

 	
 Interest
 and Interest Periods

 	
 30

 
	
  

 	
  

 	
  

 
	
 4

 	
 Repayment
 and prepayment

 	
 32

 
	
  

 	
  

 	
  

 
	
 5

 	
 Fees,
 commitment commission and expenses

 	
 35

 
	
  

 	
  

 	
  

 
	
 6

 	
 Payments
 and taxes; accounts and calculations

 	
 37

 
	
  

 	
  

 	
  

 
	
 7

 	
 Representations
 and warranties

 	
 39

 
	
  

 	
  

 	
  

 
	
 8

 	
 Undertakings

 	
 45

 
	
  

 	
  

 	
  

 
	
 9

 	
 Conditions

 	
 53

 
	
  

 	
  

 	
  

 
	
 10

 	
 Events
 of Default

 	
 54

 
	
  

 	
  

 	
  

 
	
 11

 	
 Indemnities

 	
 61

 
	
  

 	
  

 	
  

 
	
 12

 	
 Unlawfulness,
 increased costs and mitigation

 	
 63

 
	
  

 	
  

 	
  

 
	
 13

 	
 Security,
 set-off and pro-rata payments

 	
 65

 
	
  

 	
  

 	
  

 
	
 14

 	
 Accounts

 	
 67

 
	
  

 	
  

 	
  

 
	
 15

 	
 Assignment,
 transfer and lending office

 	
 69

 
	
  

 	
  

 	
  

 
	
 16

 	
 Arrangers,
 Agent and Security Agent

 	
 71

 
	
  

 	
  

 	
  

 
	
 17

 	
 Notices
 and other matters

 	
 80

 
	
  

 	
  

 	
  

 
	
 18

 	
 Governing
 law and jurisdiction

 	
 83

 
	
  

 	
  

 	
  

 
	
 Schedule
 1 The Banks and their Commitments and the Guarantee Banks and their
 Percentages

 	
 84

 
	
  

 	
  

 	
  

 
	
 Schedule
 2 Form of Drawdown Notice and Bank Guarantee Request

 	
 86

 
	
  

 	
  

 	
  

 
	
 Schedule
 3 Documents and evidence required as conditions precedent

 	
 88

 
	
  

 	
  

 	
  

 
	
 Schedule
 4 Form of Transfer Certificate

 	
 98

 
	
  

 	
  

 	
  

 
	
 Schedule
 5 Contract Instalment Advances per Ship

 	
 102

 
	
  

 	
  

 	
  

 
	
 Schedule
 6 Form of Trust Deed

 	
 103

 
	
  

 	
  

 	
  

 
	
 Schedule
 7 Form of Bank Guarantee

 	
 104

 
	
  

 	
  

 	
  

 
	
 Schedule 8 Mandatory Cost formula

 	
 108

 

	
  

 	
  

 
	
 THIS AGREEMENT is dated 14 January 2011 and
 made BETWEEN:

 
	
  

 
	
 (1)

 	
 ADELE SHIPPING CO., BASTIAN SHIPPING CO. and CADENCE SHIPPING CO. as joint and several
 Borrowers; 

 
	
  

 	
  

 
	
 (2)

 	
 DNB NOR BANK ASA as
 Agent, Security Agent and Account Bank; 

 
	
  

 	
  

 
	
 (3)

 	
 DNB NOR BANK ASA as
 Swap Provider; 

 
	
  

 	
  

 
	
 (4)

 	
 THE EXPORT-IMPORT BANK OF CHINA
 and DNB NOR BANK ASA as
 Arrangers; 

 
	
  

 	
  

 
	
 (5)

 	
 THE EXPORT-IMPORT BANK OF CHINA as
 Issuing Bank; and 

 
	
  

 	
  

 
	
 (6)

 	
 THE BANKS AND FINANCIAL INSTITUTIONS
 whose names and addresses are set out in schedule 1 as Banks. 

 

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 IT IS AGREED as follows:

 
	
  

 	
  

 	
  

 	
  

 
	
 1

 	
  

 	
 Purpose and definitions 

 
	
  

 	
  

 	
  

 	
  

 
	
 1.1

 	
  

 	
 Purpose 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 This Agreement sets out the terms and conditions upon and subject to
 which: 

 
	
  

 	
  

 	
  

 	
  

 
	

  

 	
  

 	
 (a)

 	
 the Banks agree, according to their several obligations, to make available
 to the Borrowers, jointly and severally, a loan facility of up to Two hundred
 and three million three hundred and forty three thousand Dollars
 ($203,343,000) in twelve (12) Advances; and 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 the Guarantee Banks agree, according to their several obligations, to
 make available to the Borrowers, jointly and severally, a guarantee facility
 of up to Twenty eight million eight hundred and fifty six thousand seven
 hundred and eighty one Dollars ($28,856,781), 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 each for the purpose of financing and guaranteeing part of the
 construction and acquisition cost of the Ships. 

 
	
  

 	
  

 	
  

 	
  

 
	
 1.2

 	
  

 	
 Definitions 

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 In this Agreement, unless the context otherwise requires: 

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 “Account Bank” means DnB
 NOR Bank ASA, a company incorporated in Norway with its registered office at
 Stranden 21, P.O. Box 1171 Sentrum N-0107 Oslo, Norway, acting for the
 purposes of this Agreement through its branch at 20 St. Dunstan’s Hill,
 London EC3R 8HY, England (or of such other address as may last have been
 notified to the other parties to this Agreement pursuant to clause 17.1.3) or
 such other person as may be appointed as Account Bank by the Agent for the
 purposes of this Agreement and includes its successors in title; 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 “Account Assignments”
 means, together, the Operating Account Assignments and the Cash Collateral
 Account Assignment and “Account Assignment”
 means any of them; 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 “Accounts” means,
 together, the Operating Accounts and the Cash Collateral Account and “Account” means any of them; 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 “Adele Bank Guarantee” means the guarantee in
 respect of the Adele Ship issued or (as the context may require) to be issued
 by the Issuing Bank in favour of CSTC in the form set out in schedule 7, in
 the maximum amount of Nine million six hundred and eighteen thousand nine hundred
 and twenty seven Dollars ($9,618,927) (comprising a principal amount of Nine
 million five hundred and eight thousand Dollars ($9,508,000) and interest
 thereon in the maximum amount of One hundred and ten thousand nine hundred
 and twenty seven Dollars ($110,927)); 

 

1

	
  

 	
  

 
	
  

 	
 “Adele Borrower” means
 Adele Shipping Co. of 80 Broad Street, Monrovia, Liberia and includes its
 successors in title; 

 
	
  

 	
  

 
	
  

 	
 “Adele Charter” means
 the “NYPE Form” time charterparty dated 27 September 2010 in respect of the
 Adele Ship made between the Charterer and the Adele Borrower, and as the same
 may be further amended, supplemented and/or novated from time to time; 

 
	
  

 	
  

 
	
  

 	
 “Adele Charter Assignment”
 means the specific assignment of the Adele Charter executed or (as the
 context may require) to be executed by the Adele Borrower in favour of the
 Security Agent in a form previously agreed between the Agent and the
 Borrowers; 

 
	
  

 	
  

 
	
  

 	
 “Adele Contract” means
 the shipbuilding contract dated 21 September 2010 made between the Seller and
 the Adele Borrower, as may be amended and supplemented from time to time,
 relating to the construction and sale by the Seller, and the purchase by the
 Adele Borrower, of the Adele Ship; 

 
	
  

 	
  

 
	
  

 	
 “Adele Contract Assignment Consent
 and Acknowledgement” means the acknowledgement of notice of, and
 consent to, the assignment in respect of the Adele Contract given or (as the
 context may require) to be given in the form scheduled to the Adele
 Pre-delivery Security Assignment; 

 
	
  

 	
  

 
	
  

 	
 “Adele Contract Instalment Advance”
 means, in relation to the Adele Ship, each of the three (3) Advances of the
 Total Commitment, each in the maximum amount in Dollars specified in the
 second column of schedule 5 opposite the name of the relevant Advance and
 each made or (as the context may require) to be made to finance in part or
 (as the case may be) in full the payment of an instalment of the Adele
 Contract Price falling due before the Delivery Date for the Adele Ship at the
 time specified in the third column of schedule 5 opposite the relevant Advance,
 and “Adele Contract Instalment Advances”
 means any or all of them; 

 
	
  

 
	
  

 	
 “Adele Contract Price”
 means the purchase price for the Adele Ship under the Adele Contract, being
 Ninety five million eighty thousand Dollars ($95,080,000) or such other
 lesser sum in Dollars as may be payable as the purchase price for the Adele
 Ship by the Adele Borrower to the Seller pursuant to the Adele Contract; 

 
	
  

 	
  

 
	
  

 	
 “Adele Deed of Covenant”
 means the deed of covenant and/or (as the case may be) the general assignment
 collateral to the Adele Mortgage executed or (as the context may require) to
 be executed by the Adele Borrower in favour of the Security Agent and/or any
 of the other Creditors in such form as the Agent may reasonably require; 

 
	
  

 	
  

 
	
  

 	
 “Adele Delivery Advance”
 means an Advance of up to $19,016,000 made or (as the context may require) to
 be made available to the Borrowers on the Delivery Date of the Adele Ship for
 the purpose of financing part of the construction and acquisition cost of the
 Adele Ship by the Adele Borrower pursuant to the Adele Contract; 

 
	
  

 	
  

 
	
  

 	
 “Adele Management Agreement”
 means each agreement made or (as the context may require) to be made between
 the Adele Borrower and any Manager in the Standard Form or, if in any other
 form, in a form acceptable to the Agent (acting on the instructions of the
 Majority Banks), providing (inter alia)
 for that Manager to carry out the commercial and/or the technical management
 of the Adele Ship; 

 
	
  

 	
  

 
	
  

 	
 “Adele Mortgage” means
 the first priority or (as the case may be) preferred mortgage of the Adele
 Ship executed or (as the context may require) to be executed by the Adele
 Borrower in favour of the Security Agent and/or any of the other Creditors in
 such form as the Agent may require in its reasonable discretion; 

 
	
  

 	
  

 
	
  

 	
 “Adele Operating Account”
 means an interest bearing Dollar account of the Adele Borrower opened or (as
 the context may require) to be opened with the Account Bank and includes any
 sub-accounts thereof; 

 
	
  

 	
  

 
	
  

 	
 “Adele Operating Account Assignment”
 means the first priority assignment of the Adele Operating Account executed
 or (as the context may require) to be executed by the Adele Borrower in
 favour of the Security Agent in a form previously agreed between the Agent
 and the Borrowers; 

 

2

	
  

 	
  

 	
  

 
	
  

 	
 “Adele Pre-delivery Security
 Assignment” means the assignment of the Adele Contract and the
 Adele Refund Guarantees executed or (as the context may require) to be
 executed by the Adele Borrower in favour of the Security Agent in a form
 previously agreed between the Agent and the Borrowers; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Adele Refund Guarantee”
 means each letter of guarantee issued or (as the context may require) to be
 issued by the Refund Guarantor in favour of the Adele Borrower in respect of
 the Seller’s obligations under the Adele Contract, each in the form
 prescribed in the Adele Contract, and any further guarantee(s) to be issued
 by the Refund Guarantor in respect of such obligations pursuant to any
 agreement supplemental to the Adele Contract, and any extensions, renewals or
 replacements thereto or thereof, and “Adele
 Refund Guarantees” means any and all of them; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Adele Refund Guarantee Assignment
 Consent and Acknowledgement” means, in relation to each Adele
 Refund Guarantee, an acknowledgement of notice of, and consent to, the assignment
 in respect of that Adele Refund Guarantee given or (as the context may
 require) to be given by the Refund Guarantor in the form scheduled to the
 Adele Pre-delivery Security Assignment and “Adele
 Refund Guarantee Assignment Consents and Acknowledgements” means any or all of them; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Adele Ship” means the
 9,000 teu container ship known on the date of this Agreement as Hull No.
 H1068A at the Builder’s yard, to be constructed and sold by the Seller to the
 Adele Borrower pursuant to the Adele Contract and to be registered on its
 Delivery Date in the ownership of the Adele Borrower through the relevant
 Registry under the laws and flag of the relevant Flag State; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Adele Tranche” means a
 tranche of the Total Commitment and the Loan of up to $67,781,000, comprising
 the three (3) Adele Contract Instalment Advances and the Adele Delivery
 Advance, or (as the context may require) the aggregate principal amount of
 such Tranche outstanding at any relevant time; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Advance” means each
 borrowing of a portion of the Total Commitment by the Borrowers or (as the
 context may require) the outstanding principal amount of such borrowing at
 any relevant time, and it includes each Adele Contract Instalment Advance,
 the Adele Delivery Advance, each Bastian Contract Instalment Advance, the
 Bastian Delivery Advance, each Cadence Contract Instalment Advance and the
 Cadence Delivery Advance, and also: 

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the Adele Ship and/or the Adele Borrower and/or the
 Adele Tranche, it means the Adele Contract Instalment Advances and the Adele
 Delivery Advance; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the Bastian Ship and/or the Bastian Borrower and/or
 the Bastian Tranche, it means the Bastian Contract Instalment Advances and
 the Bastian Delivery Advance; or 

 
	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the Cadence Ship and/or the Cadence Borrower and/or
 the Cadence Tranche, it means the Cadence Contract Instalment Advances and
 the Cadence Delivery Advance, 

 
	
  

 	
  

 	
  

 
	
  

 	
 and “Advances” means any
 or all of them; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Agent” means DnB NOR
 Bank ASA, a company incorporated in Norway with its registered office at
 Stranden 21, P.O. Box 1171 Sentrum N-0107 Oslo, Norway, acting for the
 purposes of this Agreement through its branch at 20 St. Dunstan’s Hill,
 London EC3R 8HY, England (or of such other address as may last have been
 notified to the other parties to this Agreement pursuant to clause 17.1.3) or
 such other person as may be appointed as agent by the Banks, the Issuing Bank
 and the Swap Provider pursuant to clause 16.13 and includes its successors in
 title; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Applicable Accounting Principles”
 means the most recent and up-to-date US GAAP at any relevant time; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Applicable Fraction”
 means, at any time and in relation to a Ship which is then subject to a
 Charterer Event or a New Charterer Event, a fraction having (a) as its
 numerator the then outstanding balance of the Tranche relating to such Ship
 and (b) as its denominator the then outstanding amount of the Loan; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Approved Shipbrokers”
 means, together, H. Clarkson and Company Ltd of London, England, Arrow
 Research Ltd. of London, England, Braemar Seascope of London, England,
 Simpson Spence & Young 

 

3

	
  

 	
  

 	
  

 
	
  

 	
 of London, England, Maersk Brokers of London, England and Howe
 Robinson of London, England and any other independent firm of shipbrokers
 nominated by the Borrowers and approved in writing by the Agent in its
 absolute discretion from time to time and “Approved
 Shipbroker” means any
 of them; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Arrangers” means,
 together, (a) The Export-Import Bank of China, a company with its registered
 office at No. 30, Fuxingmen Nei Street, Xicheng District, Beijing 100031,
 People’s Republic of China and (b) DnB NOR Bank ASA, a company incorporated
 in Norway with its registered office at Stranden 21, P.O. Box 1171 Sentrum,
 N-0107 Oslo, Norway acting for the purposes of this Agreement through its
 branch at 20 St. Dunstan’s Hill, London EC3R 8HY, England (or, in each case,
 of such other address as may last have been notified to the other parties to
 this Agreement pursuant to clause 17.1.3), in their capacity as Mandated
 Co-Lead Arrangers and includes their respective successors in title, and “Arranger” means either of them; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Assigned Contract”
 means, at any relevant time, a Contract which is at such time subject to a
 Pre-delivery Security Assignment and a Contract shall, for the purposes of
 this Agreement, be deemed to be an Assigned Contract as from whichever shall
 be the earlier of (a) the Drawdown Date of the first Contract Instalment
 Advance to be drawn down for the Ship to which such Contract relates, (b) the
 Bank Guarantee Issue Date relating to that Ship and (c) the date that the
 Pre-delivery Security Assignment relevant to that Ship shall have been
 executed in accordance with this Agreement until the earlier of (i) the date
 when the Borrowers have complied with all their obligations under clause
 4.3.2 following the assignment, transfer or novation of such Contract and
 (ii) the Drawdown Date of the Delivery Advance for the Ship to which such
 Contract relates; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Assigned Refund Guarantee”
 means, at any relevant time, any Refund Guarantee which is at such time
 subject to a Pre-delivery Security Assignment and a Refund Guarantee shall,
 for the purposes of this Agreement, be deemed to be an Assigned Refund
 Guarantee as from whichever shall be the earlier of (a) the Drawdown Date of
 the first Contract Instalment Advance to be drawn down for the Ship to which
 such Refund Guarantee relates, (b) the Bank Guarantee Issue Date for the Bank
 Guarantee relating to that Ship and (c) the date that the Pre-delivery
 Security Assignment relevant to that Ship shall have been executed in
 accordance with this Agreement until the earlier of (i) the date when the
 Borrowers have complied with all their obligations under clause 4.3.2
 following the assignment, transfer or novation of the Contract to which such
 Refund Guarantee relates or the Total Loss of the relevant Ship and (ii) the
 Drawdown Date of the Delivery Advance for the Ship to which such Refund
 Guarantee relates; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Balloon Instalment”
 has, in respect of each Tranche, the meaning ascribed thereto in clause 4.1
 and “Balloon Instalments” means
 any or all of them; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Bank Guarantee”: 

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the Adele Ship, the Adele Contract and the Adele
 Borrower, means the Adele Bank Guarantee; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the Bastian Ship, the Bastian Contract and the Bastian
 Borrower, means the Bastian Bank Guarantee; or 

 
	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the Cadence Ship, the Cadence Contract and the Cadence
 Borrower, means the Cadence Bank Guarantee, 

 
	
  

 	
  

 	
  

 
	
  

 	
 and “Bank Guarantees”
 means any or all of them; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Bank Guarantee Expiry Date”
 means, in respect of a Bank Guarantee, the date on which the relevant Bank
 Guarantee is expressed to expire or, if earlier, the date on which the
 Outstanding Amount in relation to such Bank Guarantee has been reduced to
 zero (0) pursuant to any of the provisions of that Bank Guarantee or this
 Agreement; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Bank Guarantee Issue Date”
 means, in relation to a Bank Guarantee, the date, being a Banking Day falling
 within the Guarantee Availability Period, on which the Borrowers request that
 such Bank Guarantee be issued (as specified in such Bank Guarantee Request)
 or (as the context may require) the date on which such Bank Guarantee is
 actually issued; 

 

4

	
  

 	
  

 
	
  

 	
 “Bank Guarantee Request”
 means, in respect of each Bank Guarantee, a request in the form set out in
 Part 2 of schedule 2; 

 
	
  

 	
  

 
	
  

 	
 “Banking Day” means a
 day on which dealings in deposits in Dollars are carried on in the London
 Interbank Eurocurrency Market and (other than Saturday or Sunday) on which
 banks are open for business in London, Athens, Beijing and New York City (or
 any other relevant place of payment under clause 6); 

 
	
  

 	
  

 
	
  

 	
 “Banks” means the banks
 and financial institutions set out in schedule 1 and includes their
 respective successors in title and Transferee Banks and “Bank” means any of them; 

 
	
  

 	
  

 
	
  

 	
 “Basel 2 Accord” means
 the “International Convergence of Capital Measurement and Capital Standards,
 a Revised Framework” published by the Basel Committee on Banking Supervision
 in June 2004 in the form existing on the date of this Agreement; 

 
	
  

 	
  

 
	
  

 	
 “Basel 2 Approach”
 means, in relation to each Bank, either the Standardised Approach or the
 relevant Internal Ratings Based Approach (each as defined in the Basel 2 Accord)
 adopted by such Bank (or its holding company) for the purposes of
 implementing or complying with the Basel 2 Accord; 

 
	
  

 	
  

 
	
  

 	
 “Basel 2 Regulation”
 means, in relation to each Bank, (a) any law or regulation implementing the
 Basel 2 Accord or (b) any Basel 2 Approach adopted by such Bank; 

 
	
  

 	
  

 
	
  

 	
 “Bastian Bank Guarantee” means the guarantee in
 respect of the Bastian Ship issued or (as the context may require) to be
 issued by the Issuing Bank in favour of CSTC in the form set out in schedule
 7, in the maximum amount of Nine million six hundred and eighteen thousand
 nine hundred and twenty seven Dollars ($9,618,927) (comprising a principal
 amount of Nine million five hundred and eight thousand Dollars ($9,508,000)
 and interest thereon in the maximum amount of One hundred and ten thousand
 nine hundred and twenty seven Dollars ($110,927)); 

 
	
  

 	
  

 
	
  

 	
 “Bastian Borrower” means
 Bastian Shipping Co. of 80 Broad Street, Monrovia, Liberia and includes its
 successors in title; 

 
	
  

 	
  

 
	
  

 	
 “Bastian Charter” means
 the “NYPE Form” time charterparty dated 27 September 2010 in respect of the
 Bastian Ship made between the Charterer and the Bastian Borrower, and as the
 same may be further amended, supplemented and/or novated from time to time; 

 
	
  

 	
  

 
	
  

 	
 “Bastian Charter Assignment”
 means the specific assignment of the Bastian Charter executed or (as the
 context may require) to be executed by the Bastian Borrower in favour of the
 Security Agent in a form previously agreed between the Agent and the
 Borrowers; 

 
	
  

 	
  

 
	
  

 	
 “Bastian Contract” means
 the shipbuilding contract dated 21 September 2010 made between the Seller and
 the Bastian Borrower, as may be amended and supplemented from time to time,
 relating to the construction and sale by the Seller, and the purchase by the
 Bastian Borrower, of the Bastian Ship; 

 
	
  

 	
  

 
	
  

 	
 “Bastian Contract Assignment
 Consent and Acknowledgement” means the acknowledgement of notice
 of, and consent to, the assignment in respect of the Bastian Contract given
 or (as the context may require) to be given in the form scheduled to the
 Bastian Pre-delivery Security Assignment; 

 
	
  

 	
  

 
	
  

 	
 “Bastian Contract Instalment
 Advance” means, in relation to the Bastian Ship, each of the three
 (3) Advances of the Total Commitment, each in the maximum amount in Dollars
 specified in the second column of schedule 5 opposite the name of the
 relevant Advance and each made or (as the context may require) to be made to
 finance in part or (as the case may be) in full the payment of an instalment
 of the Bastian Contract Price falling due before the Delivery Date for the
 Bastian Ship at the time specified in the third column of schedule 5 opposite
 the relevant Advance, and “Bastian Contract
 Instalment Advances” means any or all of them; 

 
	
  

 	
  

 
	
  

 	
 “Bastian Contract Price”
 means the purchase price for the Bastian Ship under the Bastian Contract,
 being Ninety five million eighty thousand Dollars ($95,080,000) or such other
 lesser sum in Dollars as may be payable as the purchase price for the Bastian
 Ship by the Bastian Borrower to the Seller pursuant to the Bastian Contract; 

 

5

	
  

 	
  

 
	
  

 	
 “Bastian Deed of Covenant”
 means the deed of covenant and/or (as the case may be) the general assignment
 collateral to the Bastian Mortgage executed or (as the context may require)
 to be executed by the Bastian Borrower in favour of the Security Agent and/or
 any of the other Creditors in such form as the Agent may reasonably require; 

 
	
  

 	
  

 
	
  

 	
 “Bastian Delivery Advance”
 means an Advance of up to $19,016,000 made or (as the context may require) to
 be made available to the Borrowers on the Delivery Date of the Bastian Ship
 for the purpose of financing part of the construction and acquisition cost of
 the Bastian Ship by the Bastian Borrower pursuant to the Bastian Contract; 

 
	
  

 	
  

 
	
  

 	
 “Bastian Management Agreement”
 means each agreement made or (as the context may require) to be made between
 the Bastian Borrower and any Manager in the Standard Form or, if in any other
 form, in a form acceptable to the Agent (acting on the instructions of the
 Majority Banks), providing (inter alia)
 for that Manager to carry out the commercial and/or the technical management
 of the Bastian Ship; 

 
	
  

 	
  

 
	
  

 	
 “Bastian Mortgage” means
 the first priority or (as the case may be) preferred mortgage of the Bastian
 Ship executed or (as the context may require) to be executed by the Bastian Borrower
 in favour of the Security Agent and/or any of the other Creditors in such
 form as the Agent may require in its reasonable discretion; 

 
	
  

 	
  

 
	
  

 	
 “Bastian Operating Account”
 means an interest bearing Dollar account of the Bastian Borrower opened or
 (as the context may require) to be opened with the Account Bank and includes
 any sub-accounts thereof; 

 
	
  

 	
  

 
	
  

 	
 “Bastian Operating Account
 Assignment” means the first priority assignment of the Bastian
 Operating Account executed or (as the context may require) to be executed by
 the Bastian Borrower in favour of the Security Agent in a form previously
 agreed between the Agent and the Borrowers; 

 
	
  

 	
  

 
	
  

 	
 “Bastian Pre-delivery Security
 Assignment” means the assignment of the Bastian Contract and the
 Bastian Refund Guarantees executed or (as the context may require) to be
 executed by the Bastian Borrower in favour of the Security Agent in a form
 previously agreed between the Agent and the Borrowers; 

 
	
  

 	
  

 
	
  

 	
 “Bastian Refund Guarantee”
 means each letter of guarantee issued or (as the context may require) to be
 issued by the Refund Guarantor in favour of the Bastian Borrower in respect
 of the Seller’s obligations under the Bastian Contract, each in the form
 prescribed in the Bastian Contract, and any further guarantee(s) to be issued
 by the Refund Guarantor in respect of such obligations pursuant to any
 agreement supplemental to the Bastian Contract, and any extensions, renewals
 or replacements thereto or thereof and “Bastian
 Refund Guarantees” means any and all of them; 

 
	
  

 	
  

 
	
  

 	
 “Bastian Refund Guarantee
 Assignment Consent and Acknowledgement” “ means, in relation to
 each Bastian Refund Guarantee, an acknowledgement of notice of, and consent
 to, the assignment in respect of that Bastian Refund Guarantee given or (as
 the context may require) to be given by the Refund Guarantor in the form
 scheduled to the Bastian Pre-delivery Security Assignment and “Bastian Refund Guarantee Assignment Consents and
 Acknowledgements” means
 any or all of them; 

 
	
  

 	
  

 
	
  

 	
 “Bastian Ship” means the
 9,000 teu container ship known on the date of this Agreement as Hull No.
 H1069A at the Builder’s yard, to be constructed and sold by the Seller to the
 Bastian Borrower pursuant to the Bastian Contract and to be registered on its
 Delivery Date in the ownership of the Bastian Borrower through the relevant
 Registry under the laws and flag of the relevant Flag State; 

 
	
  

 	
  

 
	
  

 	
 “Bastian Tranche” means
 a tranche of the Total Commitment and the Loan of up to $67,781,000,
 comprising the three (3) Bastian Contract Instalment Advances and the Bastian
 Delivery Advance, or (as the context may require) the aggregate principal
 amount of such Tranche outstanding at any relevant time; 

 
	
  

 	
  

 
	
  

 	
 “Borrowed Money” means
 Indebtedness in respect of (i) money borrowed or raised and debit balances at
 banks, (ii) any bond, note, loan stock, debenture or similar debt instrument,
 (iii) acceptance or documentary credit facilities, (iv) receivables sold or
 discounted (otherwise than on a non-recourse basis), (v) deferred payments
 for assets or services acquired (except assets or services obtained on 

 

6

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 normal commercial terms in the ordinary course of business), (vi)
 finance leases and hire purchase contracts (other than in respect of
 equipment used in the ordinary course of its business, the payments of which
 do not exceed the amount of $500,000 per year per Security Party), (vii)
 swaps, forward exchange contracts, futures and other derivatives (and when
 calculating the value of any such transaction where the term “Borrowed Money”
 is used, only the marked-to-market value shall be taken into account), (viii)
 any other transaction (including without limitation forward sale or purchase
 agreements) having the commercial effect of a borrowing or raising of money
 or of any of (ii) to (vii) above and (ix) guarantees in respect of
 Indebtedness of any person falling within any of (i) to (viii) above;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Borrower”:

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the
 Adele Ship and/or the Adele Tranche (or any Advance thereof), means the Adele
 Borrower;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the
 Bastian Ship and/or the Bastian Tranche (or any Advance thereof), means the
 Bastian Borrower; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the
 Cadence Ship and/or the Cadence Tranche (or any Advance thereof), means the
 Cadence Borrower,

 
	
  

 	
  

 	
  

 
	
  

 	
 and “Borrowers” means
 any or all of them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Borrowers’ Security Documents”
 means, at any relevant time, such of the Security Documents as shall have
 been executed by any of the Borrowers at such time;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Builder” means Shanghai
 Jiangnan Changxing Heavy Industries Co., Ltd of Marine Tower, No. 1 Pudong Da
 Dao, Shanghai 200120, People’s Republic of China and includes its successors
 in title;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Bank Guarantee” means the guarantee in
 respect of the Cadence Ship issued or (as the context may require) to be
 issued by the Issuing Bank in favour of CSTC in the form set out in schedule
 7, in the maximum amount of Nine million six hundred and eighteen thousand
 nine hundred and twenty seven Dollars ($9,618,927) (comprising a principal
 amount of Nine million five hundred and eight thousand Dollars ($9,508,000)
 and interest thereon in the maximum amount of One hundred and ten thousand
 nine hundred and twenty seven Dollars ($110,927));

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Borrower” means
 Cadence Shipping Co. of 80 Broad Street, Monrovia, Liberia and includes its
 successors in title;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Charter” means the “NYPE Form” time
 charterparty dated 27 September 2010 in respect of the Cadence Ship made
 between the Charterer and the Cadence Borrower, and as the same may be
 further amended, supplemented and/or novated from time to time;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Charter Assignment” means the specific
 assignment of the Cadence Charter executed or (as the context may require) to
 be executed by the Cadence Borrower in favour of the Security Agent in a form
 previously agreed between the Agent and the Borrowers;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Contract” means
 the shipbuilding contract dated 21 September 2010 made between the Seller and
 the Cadence Borrower, as may be amended and supplemented from time to time,
 relating to the construction and sale by the Seller, and the purchase by the
 Cadence Borrower, of the Cadence Ship;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Contract Assignment
 Consent and Acknowledgement” means the acknowledgement of notice
 of, and consent to, the assignment in respect of the Cadence Contract given
 or (as the context may require) to be given in the form scheduled to the
 Cadence Pre-delivery Security Assignment;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Contract Instalment
 Advance” means, in relation to the Cadence Ship, each of the three
 (3) Advances of the Total Commitment, each in the maximum amount in Dollars
 specified in the second column of schedule 5 opposite the name of the
 relevant Advance and each made or (as the context may require) to be made to
 finance in part or (as the case may be) in full the payment of an

 

7

	
  

 	
  

 	
  

 
	
  

 	
 instalment of the Cadence Contract Price falling due before the
 Delivery Date for the Cadence Ship at the time specified in the third column
 of schedule 5 opposite the relevant Advance, and “Cadence Contract Instalment Advances” means any or all of
 them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Contract Price”
 means the purchase price for the Cadence Ship under the Cadence Contract,
 being Ninety five million eighty thousand Dollars ($95,080,000) or such other
 lesser sum in Dollars as may be payable as the purchase price for the Cadence
 Ship by the Cadence Borrower to the Seller pursuant to the Cadence Contract;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Deed of Covenant”
 means the deed of covenant and/or (as the case may be) the general assignment
 collateral to the Cadence Mortgage executed or (as the context may require)
 to be executed by the Cadence Borrower in favour of the Security Agent and/or
 any of the other Creditors in such form as the Agent may reasonably require;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Delivery Advance”
 means an Advance of up to $19,016,000 made or (as the context may require) to
 be made available to the Borrowers on the Delivery Date of the Cadence Ship
 for the purpose of financing part of the construction and acquisition cost of
 the Cadence Ship by the Cadence Borrower pursuant to the Cadence Contract;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Management Agreement”
 means each agreement made or (as the context may require) to be made between
 the Cadence Borrower and any Manager in the Standard Form or, if in any other
 form, in a form acceptable to the Agent (acting on the instructions of the
 Majority Banks), providing (inter alia)
 for that Manager to carry out the commercial and/or the technical management
 of the Cadence Ship;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Mortgage” means
 the first priority or (as the case may be) preferred mortgage of the Cadence
 Ship executed or (as the context may require) to be executed by the Cadence
 Borrower in favour of the Security Agent and/or any of the other Creditors in
 such form as the Agent may require in its reasonable discretion;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Operating Account”
 means an interest bearing Dollar account of the Cadence Borrower opened or
 (as the context may require) to be opened with the Account Bank and includes
 any sub-accounts thereof;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Operating Account
 Assignment” means the first priority assignment of the Cadence
 Operating Account executed or (as the context may require) to be executed by
 the Cadence Borrower in favour of the Security Agent in a form previously
 agreed between the Agent and the Borrowers;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Pre-delivery Security
 Assignment” means the assignment of the Cadence Contract and the
 Cadence Refund Guarantees executed or (as the context may require) to be
 executed by the Cadence Borrower in favour of the Security Agent in a form
 previously agreed between the Agent and the Borrowers;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Refund Guarantee”
 means each letter of guarantee issued or (as the context may require) to be
 issued by the Refund Guarantor in favour of the Cadence Borrower in respect
 of the Seller’s obligations under the Cadence Contract, each in the form
 prescribed in the Cadence Contract, and any further guarantee(s) to be issued
 by the Refund Guarantor in respect of such obligations pursuant to any
 agreement supplemental to the Cadence Contract, and any extensions, renewals
 or replacements thereto or thereof and “Cadence
 Refund Guarantees” means any and all of them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Refund Guarantee
 Assignment Consent and Acknowledgement” means, in relation to each
 Cadence Refund Guarantee, an acknowledgement of notice of, and consent to,
 the assignment in respect of that Cadence Refund Guarantee given or (as the
 context may require) to be given by the Refund Guarantor in the form
 scheduled to the Cadence Pre-delivery Security Assignment and “Cadence Refund
 Guarantee Assignment Consents and Acknowledgements” means any or all of them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Ship” means the
 9,000 teu container ship known on the date of this Agreement as Hull No.
 H1070A at the Builder’s yard, to be constructed and sold by the Seller to the
 Cadence Borrower

 

8

	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 pursuant to the Cadence Contract and to be registered on its Delivery
 Date in the ownership of the Cadence Borrower through the relevant Registry
 under the laws and flag of the relevant Flag State;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cadence Tranche” means
 a tranche of the Total Commitment and the Loan of up to $67,781,000,
 comprising the three (3) Cadence Contract Instalment Advances and the Cadence
 Delivery Advance, or (as the context may require) the aggregate principal
 amount of such Tranche outstanding at any relevant time;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Capital Adequacy Law”
 means any law or any regulation (whether or not having the force of law, but,
 if not having the force of law, with which a Bank or, as the case may be, its
 holding company, habitually complies), including (without limitation) those
 relating to Taxation, capital adequacy, liquidity, reserve assets, cash ratio
 deposits and special deposits or other banking or monetary controls or
 requirements which affect the manner in which a Bank allocates capital
 resources to its obligations hereunder (including, without limitation, those
 resulting from the implementation or application of or compliance with the
 Basel 2 Accord or any Basel 2 Regulation);

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cash Collateral Account”
 means an interest bearing Dollar account of the Borrowers opened or (as the
 context may require) to be opened by the Borrowers with the Account Bank and
 includes any sub-accounts thereof;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Cash Collateral Account Assignment”
 means the first priority assignment of the Cash Collateral Account executed
 or (as the context may require) to be executed by the Borrowers in favour of
 the Security Agent in a form previously agreed between the Agent and the
 Borrowers;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Casualty Amount” means,
 in relation to each Ship, Two million Dollars ($2,000,000) or the equivalent
 in any other currency;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Charter” means:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the Adele Ship, the Adele Charter;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the Bastian Ship, the Bastian Charter; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the Cadence Ship, the Cadence Charter,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 and “Charters” means any
 or all of them;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 “Charter Assignment”
 means:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the Adele Ship, the Adele Charter Assignment;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the Bastian Ship, the Bastian Charter Assignment; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the Cadence Ship, the Cadence Charter Assignment,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 and “Charter Assignments”
 means any or all of them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Charterer” means
 MSC-Mediterranean Shipping Co. S.A. of Geneva, Switzerland and it includes
 its successors in title;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Charterer Event” means,
 in relation to a Ship, any of the following events:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 the Charterer at any time fails to comply with any of its payment obligations
 under the Charter for that Ship, unless:

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (i)

 	
 such failure is remedied completely by the Charterer within 60 days
 from the day such failure occurred; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (ii)

 	
 the relevant Borrower has terminated the relevant Charter within 60
 days from the day such failure occurred (but without prejudice to paragraph
 (b) below); or

 

9

	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 the Charter for that Ship is terminated, cancelled, rescinded or
 repudiated for any reason whatsoever (including in the circumstances described
 in paragraph (a)(ii) above), unless:

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (i)

 	
 within 15 days from such event, the relevant Borrower has entered
 into a Qualifying Charter in respect of that Ship; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (ii)

 	
 within 30 days from such event, that Ship has been delivered for
 service under such Qualifying Charter; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (iii)

 	
 within 15 days from such event, the relevant Borrower has delivered
 to the Agent such Qualifying Charter duly executed and it has executed such
 documents and evidence in respect of such Qualifying Charter (including a
 charter assignment of the same), and the Borrowers have delivered to the
 Agent such other documents and evidence, as are specified in clause 8.1.17 in
 respect of charterparties or other contracts of employment in respect of the
 Ships;

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 “Ciel Management” means
 Ciel Shipmanagement S.A., a Liberian corporation with its registered office
 at 80 Broad Street, Monrovia, Liberia having a place of business at 2-6
 Aeroporon Street, P. Faliro, Athens 175 64, Greece and it includes its
 successors in title; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Classification” means,
 in relation to each Ship, the highest class available for a vessel of her
 type and her specification as at her Delivery, with the relevant
 Classification Society or such other classification as the Agent shall, at
 the request of a Borrower, have agreed in writing shall be treated as the
 Classification in relation to such Borrower’s Ship for the purposes of the
 relevant Ship Security Documents;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Classification Society”
 means, in relation to each Ship, such classification society (being a member
 of the International Association of Classification Societies (“IACS”) or any successor organisation)
 which the Agent shall at the request of the Borrower owning such Ship have
 agreed in writing shall be treated as the Classification Society in relation
 to such Ship for the purposes of the relevant Ship Security Documents;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Code” means the
 International Management Code for the Safe Operation of Ships and for
 Pollution Prevention constituted pursuant to Resolution A. 741 (18) of the
 International Maritime Organisation and incorporated into the Safety of Life
 at Sea Convention (as amended) and includes any amendments or extensions
 thereto and any regulation issued pursuant thereto;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Commercial Parties”
 means, together, the Builder, CSTC, the Charterer and the Refund Guarantor
 and “Commercial Party” means any
 of them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Commitment” means, in
 relation to each Bank, the amount set out opposite its name in the column
 headed “Commitment” in schedule
 1 and/or, in the case of a Transferee Bank, the amount transferred as
 specified in the relevant Transfer Certificate, as reduced in each case by
 any relevant term of this Agreement;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Compliance Certificate”
 means each certificate received or (as the context may require) to be
 received by the Agent pursuant to clause 5.1 of the Corporate Guarantee in
 the form set out in the schedule to the Corporate Guarantee;

 
	
  

 	
  

 	
  

 
	
  

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

 
	
  

 	
  

 	
  

 
	
  

 	
 “Confirmation” shall
 have, in relation to any continuing Designated Transaction, the meaning
 ascribed to it in the Master Swap Agreement;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Contract” means:

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the Adele
 Ship, the Adele Contract;

 

10

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the
 Bastian Ship, the Bastian Contract; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the
 Cadence Ship, the Cadence Contract,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 and “Contracts” means
 any or all of them;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 “Contract Assignment Consent and
 Acknowledgement” means:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the
 Adele Ship, the Adele Contract Assignment Consent and Acknowledgement;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the
 Bastian Ship, the Bastian Contract Assignment Consent and Acknowledgement; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the
 Cadence Ship, the Cadence Contract Assignment Consent and Acknowledgement,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 and “Contract Assignment Consents
 and Acknowledgements” means any or all of them;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 “Contract Instalment Advance”
 means each Adele Contract Instalment Advance, each Bastian Contract
 Instalment Advance and each Cadence Contract Instalment Advance, and also it
 means:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the Adele Ship, the Adele Contract Instalment
 Advances;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the Bastian Ship, the Bastian Contract Instalment
 Advances; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the Cadence Ship, the Cadence Contract Instalment
 Advances,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 and “Contract Instalment Advances”
 means any or all of them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Contract Price” means:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the
 Adele Ship, the Adele Contract Price;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the
 Bastian Ship, the Bastian Contract Price; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the
 Cadence Ship, the Cadence Contract Price,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 and “Contract Prices”
 means any or all of them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Contribution” means, in
 relation to each Bank, the principal amount owing to such Bank at any
 relevant time;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Corporate Guarantee” means the corporate guarantee
 executed or (as the context may require) to be executed by the Corporate
 Guarantor in favour of the Security Agent in a form previously agreed between
 the Agent and the Borrowers;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Corporate Guarantor”
 means Costamare Inc. of Trust Company Complex, Ajeltake Road, Ajeltake
 Island, Majuro, Marshall Islands MH96960 and includes its successors in
 title;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Costamare Shipping”
 means Costamare Shipping Company S.A., a company incorporated under the laws
 of Panama and having a place of business at 60 Zephyrou Street & Syngrou
 Avenue, 175 64 Athens, Greece and it includes its successors in title; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Creditors” means,
 together, the Arrangers, the Agent, the Security Agent, the Swap Provider,
 the Issuing Bank, the Account Bank and the Banks and “Creditor” means any of them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “CSTC” means China
 Shipbuilding Trading Company, Limited of 56(Yi) Zhongguancun Nan Da Jie,
 Beijing 10044, People’s Republic of China and includes its successors in
 title;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Deed of Covenant”
 means:

 

11

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the Adele
 Ship, the Adele Deed of Covenant;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the
 Bastian Ship, the Bastian Deed of Covenant; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the
 Cadence Ship, the Cadence Deed of Covenant,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 and “Deeds of Covenant”
 means any or all of them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Default” means any
 Event of Default or any event or circumstance which with the giving of notice
 or lapse of time (or any combination thereof) would constitute an Event of
 Default;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Delivery” means, in
 relation to each Ship, the delivery of such Ship from the Seller to the
 relevant Borrower pursuant to the relevant Contract;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Delivery Advance”:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the
 Adele Ship and/or the Adele Tranche, means the Adele Delivery Advance;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the
 Bastian Ship and/or the Bastian Tranche, means the Bastian Delivery Advance;
 or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the
 Cadence Ship and/or the Cadence Tranche, means the Cadence Delivery Advance,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 and “Delivery Advances”
 means any or all of them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Delivery Date” means,
 in relation to each Ship, the date on which the Delivery of such Ship occurs;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Designated Transaction”
 means a transaction which is entered into by the Borrowers with the Swap
 Provider pursuant to the Master Swap Agreement as contemplated by clause
 2.11;

 
	
  

 	
  

 	
  

 
	
  

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

 
	
  

 	
  

 	
  

 
	
  

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

 
	
  

 	
  

 	
  

 
	
  

 	
 “Drawdown Date” means,
 in relation to each Advance, any date, being a Banking Day falling during the
 Drawdown Period for such Advance, on which the relevant Advance is, or is to
 be, made available;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Drawdown Notice” means,
 in relation to each Advance, a notice substantially in the form of Part 1 of
 schedule 2 in respect of such Advance;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Drawdown Period” means,
 in relation to each Advance, the period commencing on 30 June 2011 (but not
 earlier, unless the Majority Banks agree otherwise in writing in their
 absolute and unfettered discretion), and ending on the earlier of:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 the Final Availability Date for the Tranche of which such Advance
 forms part; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 the date on which the relevant Advance has been drawn down; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 the date when the Total Commitment is reduced to zero pursuant to
 clauses 10.2 or 12; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (d)

 	
 (only in relation to each Delivery Advance) the Delivery Date of the
 Ship relevant to such Delivery Advance;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 “Early Termination Date”
 shall have, in relation to any continuing Designated Transaction, the meaning
 ascribed to it in the Master Swap Agreement;

 

12

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 “Earnings” means, in
 relation to a Ship, all moneys whatsoever from time to time due or payable to
 the relevant Borrower during the Security Period arising out of the use or
 operation of such Ship including (but without limiting the generality of the
 foregoing) all freight, hire and passage moneys, income arising out of
 pooling arrangements, compensation payable to such Borrower in the event of
 requisition of such Borrower’s Ship for hire, remuneration for salvage or
 towage services, demurrage and detention moneys and damages for breach (or
 payment for variation or termination) of any charterparty or other contract
 for the employment of such Borrower’s Ship;

 
	
  

 	
  

 	
  

 
	
  

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

 
	
  

 	
  

 	
  

 
	
  

 	
 “Environmental Affiliate”
 means any agent or employee of any Borrower or any person having a
 contractual relationship with any Borrower, in each case in connection with
 any Ship or its operation or the carriage of cargo thereon and/or the
 provision of goods and/or services on or from such Ship;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Environmental Approval”
 means any consent, authorisation, licence or approval of any governmental or
 public body or authorities or courts applicable to any Ship or its operation
 or the carriage of cargo and/or passengers thereon and/or the provision of
 goods and/or services on or from such Ship required under any Environmental
 Law;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Environmental Claim”
 means:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 any and all enforcement, clean-up, removal or other governmental or
 regulatory actions or orders or claims instituted or made pursuant to any
 Environmental Law or any Environmental Approval, in respect of an amount or
 (as the case may be) the cost of which is, in excess of Two million Dollars
 ($2,000,000); and/or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 any claim made by any third party in excess of Two million Dollars
 ($2,000,000) relating to damage, contribution, loss or injury,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 resulting in any such case, from any actual or threatened emission,
 spill, release or discharge of a Pollutant from any Ship;

 
	
  

 	
  

 	
  

 
	
  

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

 
	
  

 	
  

 	
  

 
	
  

 	
 “Event of Default” means
 any of the events or circumstances described in clause 10.1;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Facility Commitment” means
 Twenty eight million eight hundred and fifty six thousand seven hundred and
 eighty one Dollars ($28,856,781);

 
	
  

 	
  

 	
  

 
	
  

 	
 “Fee Letter” means each
 letter of even date herewith made between (inter alios) the Borrowers and the
 Agent in respect of certain of the fees payable under clause 5.1 and “Fee Letters” means any or all of them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Final Availability Date”
 means:

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the Adele Bank Guarantee, the Adele Tranche and each
 Advance thereof, 7 August 2014;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the Bastian Bank Guarantee, Bastian Tranche and each
 Advance thereof, 6 September 2014; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the Cadence Bank Guarantee, the Cadence Tranche and
 each Advance thereof, 8 October 2014,

 

13

	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 or, in each such case, such later date as the Agent (acting on the
 instructions of the Majority Banks in their sole discretion) may agree in
 writing following a written request by the Borrowers to this effect, Provided that the Banks will not
 unreasonably withhold their agreement to the following later dates if the
 same are so requested by the Borrowers:

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (i)

 	
 in relation to the Adele Bank Guarantee, the Adele Tranche and each
 Advance thereof, 26 September 2014, if and provided that the Adele Refund
 Guarantees continue to remain valid and effective from 7 August 2014 until 26
 September 2014;

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (ii)

 	
 in relation to the Bastian Bank Guarantee, the Bastian Tranche and
 each Advance thereof, 26 October 2014, if and provided that the Bastian
 Refund Guarantees continue to remain valid and effective from 6 September
 2014 until 26 October 2014; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (iii)

 	
 in relation to the Cadence Bank Guarantee, the Cadence Tranche and
 each Advance thereof, 27 November 2014, if and provided that the Cadence
 Refund Guarantees continue to remain valid and effective from 8 October 2014
 until 27 November 2014;

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 “Flag State” means, in
 relation to each Ship, any of Greece, Liberia or Hong Kong or such other
 state or territory designated in writing by the Agent (acting on the
 instructions of the Majority Banks) at the request of the Borrower owning
 such Ship, as being the “Flag State”
 of such Borrower’s Ship for the purposes of the relevant Ship Security
 Documents;

 
	
  

 	
  

 	
  

 
	
  

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

 
	
  

 	
  

 	
  

 
	
  

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

 
	
  

 	
  

 	
  

 
	
  

 	
 “Guarantee Availability Period”
 means, in relation to each Bank Guarantee, the period from the date of this
 Agreement and ending on the earlier of:

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 the Final Availability Date for that Bank Guarantee; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 the date when that Bank Guarantee has been issued under this
 Agreement; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 the date when the Facility Commitment or the Total Commitment is
 reduced to zero pursuant to clauses 4.3, 10.2 or 12 or any other provision of
 this Agreement;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 “Guarantee Banks” means,
 together, the first two (2) Banks whose names appear in rows 1 and 2 of
 schedule 1 in the column headed “Name” (namely DnB NOR Bank ASA and the
 Export-Import Bank of China) and it includes their respective successors in
 title and Transferee Banks;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Guarantee Facility”
 means the guarantee facility made available under clause 2.1.2;

 
	
  

 	
  

 	
  

 
	
  

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

 
	
  

 	
  

 	
  

 
	
  

 	
 “Insurances” means, in
 relation to a Ship, all policies and contracts of insurance (which expression
 includes all entries of that Ship in a protection and indemnity or war risks
 association) which are from time to time during the Security Period in place
 or taken out or entered into by or for the benefit of the relevant Borrower
 (whether in the sole name of such Borrower, or in the joint names of such
 Borrower and the Security Agent and/or any other Creditors or otherwise) in
 respect of such Borrower’s Ship and, if applicable, her Earnings, or
 otherwise howsoever in connection with such Ship and all benefits thereof
 (including claims of whatsoever nature and return of premiums);

 
	
  

 	
  

 	
  

 
	
  

 	
 “Interest Payment Date”
 means the last day of an Interest Period;

 

14

	
  

 	
  

 	
  

 
	
  

 	
 “Interest Period” means, in relation to an
 Advance or (as the case may be) Tranche, each period for the calculation of
 interest in respect of such Advance or (as the case may be) Tranche,
 ascertained in accordance with clauses 3.2 and 3.3; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “ISPS Code” means the International Ship
 and Port Facility Security Code constituted pursuant to resolution A.924(22)
 of the International Maritime Organization now set out in Chapter XI-2 of the
 International Convention for the Safety of Life at Sea 1974 (as amended) as
 adopted by a Diplomatic conference of the International Maritime Organisation
 on Maritime Security in December 2002 and includes any amendments or
 extensions thereto and any regulation issued pursuant thereto;

 
	
  

 	
  

 	
  

 
	
  

 	
 “ISSC” means an
 International Ship Security Certificate issued in respect of a Ship pursuant
 to the ISPS Code;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Issuing Bank” means The
 Export-Import Bank of China, a banking company incorporated and established
 under the laws of the People’s Republic of China with its registered office
 at No. 30 Fuxingmen Nei Street, Xicheng District, Beijing 100031, People’s
 Republic of China, acting for the purposes of this Agreement through its
 office at No. 30, Fuxingmen Nei Street, Xicheng District, Beijing 10031,
 People’s Republic of China (or such other address as may have been notified
 to the other parties to this Agreement pursuant to clause 17.1.3) and includes
 its successors in title;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Konstantakopoulos Family”
 means, together, each of the following:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 Mr Vasileios Kostantakopoulos;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 Mr Kostantinos V. Kostantakopoulos;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 Mr Achillefs V. Kostantakopoulos;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (d)

 	
 Mr Christos V. Kostantakopoulos;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (e)

 	
 all the lineal descendants in direct line of any of the said Messrs.
 Vassileios Kostantakopoulos, Achillefs V. Kostantakopoulos, Kostantinos V.
 Kostantakopoulos and Christos V. Konstantakopoulos;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (f)

 	
 a husband or wife, or former husband or wife, or widower or widow of
 any of the above persons; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (g)

 	
 the estates, trusts or legal representatives of any of the above
 persons,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 and each one
 of the above shall be referred to as “a
 member of the Konstantakopoulos Family”;

 
	
  

 	
  

 	
  

 
	
  

 	
 “LIBOR” means in relation to a particular
 period:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 the rate for deposits of the relevant currency for a period
 equivalent to such period at or about 11:00 a.m. on the Quotation Date for
 such period as displayed on Reuters page LIBOR 01 (British Bankers’
 Association Interest Settlement Rates) (or such other page as may replace
 such page LIBOR 01 on such system or on any other system of the information
 vendor for the time being designated by the British Bankers’ Association to
 calculate the BBA Interest Settlement Rate (as defined in the British
 Bankers’ Association’s Recommended Terms and Conditions (“BBAIRS” terms) applicable at the relevant
 time)); or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 provided that if on such date no such rate is so displayed, LIBOR for
 such period shall be the rate quoted to the Agent by the Reference Bank at
 the request of the Agent, as the Reference Bank’s offered rate for deposits
 of the relevant currency in an amount approximately equal to the amount in
 relation to which LIBOR is to be determined for a period equivalent to such
 period to prime banks in the London Interbank Market at or about 11:00 a.m.
 on the Quotation Date for such period;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 “Loan” means the
 aggregate principal amount owing to the Banks under this Agreement at any
 relevant time;

 

15

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 “Majority Banks” means,
 at any relevant time, Banks (a) the aggregate of whose Contributions exceeds
 sixty six point six six per cent (66.66%) of the Loan or (b) (if no principal
 amounts are outstanding under this Agreement by way of Advances) the
 aggregate of whose Commitments exceeds sixty six point six six per cent
 (66.66%) of the Total Commitment;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 “Management Agreement”
 means:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the
 Adele Ship, each Adele Management Agreement;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the
 Bastian Ship, each Bastian Management Agreement; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the
 Cadence Ship, each Cadence Management Agreement,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 and “Management Agreements”
 means any or all of them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Manager” means, in
 relation to a Ship: 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 any one (or more) of Costamare Shipping, Ciel Management or Shanghai
 Costamare; and/or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 any other company which the Agent may (acting on the instructions of
 the Majority Banks) approve from time to time as the manager of that Ship,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 provided such person has executed a Manager’s Undertaking in relation
 to that Ship in accordance with clause 8.1.19 and the Borrowers are in
 compliance with such clause on or prior to its appointment, and “Managers” shall mean any or all of them; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Manager’s Undertakings”
 means, collectively, each of the manager’s undertakings executed or (as the
 context may require) to be executed by any Manager in favour of the Security
 Agent in respect of each of the Ships each in such form as the Agent may
 require in its reasonable discretion and, singly, each a “Manager’s Undertaking”; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Mandatory Cost” means,
 in relation to any period, a percentage calculated by the Agent for such
 period at an annual rate determined by the application of the formula set out
 in schedule 8;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Margin” means, in
 relation to each Tranche:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 from the date of this Agreement until the date of registration of the
 Mortgage over the Ship relevant to such Tranche, three point one zero per
 cent (3.10%) per annum; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 from the date falling immediately after the date of registration of
 the Mortgage over the Ship relevant to such Tranche and at all times
 thereafter, three per cent (3%);

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 “Master Swap Agreement” means the
 agreement made or (as the context may require) to be made between the Swap
 Provider and the Borrowers, comprising an ISDA Master Agreement (including
 its schedule thereto) in a form previously agreed between the Agent and the
 Borrowers and includes any Designated Transactions from time to time entered
 into thereunder and any Confirmations from time to time exchanged thereunder
 and governed thereby;

 
	
  

 	
  

 	
  

 
	
  

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

 
	
  

 	
  

 	
  

 
	
  

 	
 “Mortgage” means:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the
 Adele Ship, the Adele Mortgage;

 

16

	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the
 Bastian Ship, the Bastian Mortgage; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the
 Cadence Ship, the Cadence Mortgage,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 and “Mortgages” means
 any or all of them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Mortgaged Ship” means,
 at any relevant time, any Ship which is at such time subject to a Mortgage
 and/or the Earnings, Insurances and Requisition Compensation of which are
 subject to an Encumbrance pursuant to the relevant Ship Security Documents
 and a Ship shall, for the purposes of this Agreement, be deemed to be a
 Mortgaged Ship as from whichever shall be the earlier of (a) the Drawdown
 Date of the Delivery Advance relating to that Ship and (b) the date that the
 Mortgage of that Ship shall have been executed and registered in accordance
 with this Agreement until whichever shall be the earlier of (i) the payment
 in full of the amount required to be paid by the Borrowers pursuant to
 clause 4.3 following the sale or Total Loss of such Ship and (ii) the
 date on which all moneys owing under the Security Documents have been repaid
 in full and the Bank Guarantees have expired;

 
	
  

 	
  

 	
  

 
	
  

 	
 “New Charterer” means,
 in relation to a Qualifying Charter for a Ship, the charterer of that Ship
 under such Qualifying Charter and it includes its successors in title;

 
	
  

 	
  

 	
  

 
	
  

 	
 “New Charterer Event”
 means, in relation to a Ship which is subject to, and delivered for service
 under, a Qualifying Charter, any of the following events:

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 the New Charterer for that Ship at any time fails to comply with any
 of its payment obligations under that Qualifying Charter, unless:

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (i)

 	
 such failure
 is remedied completely by that New Charterer within 60 days from the day such
 failure occurred; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (ii)

 	
 the relevant Borrower has terminated the relevant Qualifying Charter
 within 60 days from the day such failure occurred (but without prejudice to
 paragraph (b) below); or

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 that Qualifying Charter for that Ship is terminated, cancelled,
 rescinded or repudiated for any reason whatsoever (including in the
 circumstances described in paragraph (a)(ii) above), unless:

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (i)

 	
 within 15 days from such event, the relevant Borrower has entered
 into another Qualifying Charter in respect of that Ship; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (ii)

 	
 within 30 days from such event, that Ship has been delivered for
 service under such Qualifying Charter; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (iii)

 	
 within 15 days from such event, the relevant Borrower has delivered
 to the Agent such other Qualifying Charter duly executed and it has executed
 such documents and evidence in respect of such other Qualifying Charter
 (including a charter assignment of the same), and the Borrowers have
 delivered to the Agent such other documents and evidence, as are specified in
 clause 8.1.17 in respect of charterparties or other contracts of employment
 in respect of the Ships;

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 “Operating Account”
 means:

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the
 Adele Ship, the Adele Operating Account;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the
 Bastian Ship, the Bastian Operating Account; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the
 Cadence Ship, the Cadence Operating Account,

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 and “Operating Accounts”
 means any or all of them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Operating Account Assignment”
 means:

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the
 Adele Operating Account, the Adele Operating Account Assignment;

 

17

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the
 Bastian Operating Account, the Bastian Operating Account Assignment; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the
 Cadence Operating Account, the Cadence Operating Account Assignment,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 and “Operating Account Assignments” means any or all of
 them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Operator” means any
 person who is from time to time during the Security Period concerned in the
 operation of a Ship and falls within the definition of “Company” set out in rule 1.1.2 of the
 Code;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Outstanding Amount”
 means, in relation to a Bank Guarantee at any relevant time, the maximum
 amount (whether of principal or interest) for which the relevant Bank
 Guarantee is issued less the aggregate amount of all reductions in that
 amount which have been made in accordance with the provisions of such Bank
 Guarantee and/or this Agreement as at such time (as the same is determined by
 the Agent);

 
	
  

 	
  

 	
  

 
	
  

 	
 “Outstandings” means the
 aggregate of (a) the Outstanding Amount of all Bank Guarantees and (b) the
 aggregate principal amount of each outstanding loan owing by the Borrowers
 pursuant to clauses 2.7.1 or 2.7.3 at any relevant time;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Percentage” means, in
 relation to a Guarantee Bank, the percentage set out opposite its name in the
 column headed “Bank Guarantees - Percentage”
 in schedule 1 or, as the case may be, in any relevant Transfer Certificate,
 as reduced or increased by any relevant term of this Agreement;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Permitted Encumbrance”
 means:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 any Encumbrance in favour of the Security Agent and/or any of the
 other Creditors created pursuant to the Security Documents;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 Permitted Liens;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 any Encumbrance over goods and products of a Borrower, or documents
 of title to goods and products of the Borrower, arising in the ordinary
 course of trading in connection with letters of credit and similar
 transactions where such Encumbrance secures only Indebtedness representing
 the acquisition cost or selling price (and amounts incidental thereto) of
 such goods and products required to be paid within 180 days after the date
 upon which such Indebtedness was first incurred;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (d)

 	
 any Encumbrance arising by operation of law or which arises pursuant
 to any order of attachment, distraint or similar legal process arising in
 connection with court proceedings provided that the execution or other
 enforcement thereof is effectively stayed and the claims served thereby are
 being contested at the time in good faith by appropriate proceedings; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (e)

 	
 any liens arising in the ordinary course of trading by operation of
 law in respect of obligations which are not overdue or which are being
 contested in good faith by appropriate proceedings (and for the payment of
 which adequate reserves have been provided);

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 “Permitted Liens” means,
 in relation to each Ship;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 any lien on that Ship for master’s, officer’s or crew’s wages
 outstanding in the ordinary course of trading;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 any lien on that Ship for salvage; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 any ship repairer’s or outfitter’s possessory lien on that Ship for a
 sum not (except with the prior written consent of the Agent) exceeding the
 Casualty Amount for that Ship;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 “Pollutant” means and
 includes oil and its products, any other polluting, toxic or hazardous
 substance and any other substance whose release into the environment is
 regulated or penalised by Environmental Laws;

 

18

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 “Pre-delivery Security Assignment”
 means:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the
 Adele Ship, the Adele Pre-delivery Security Assignment;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the
 Bastian Ship, the Bastian Pre-delivery Security Assignment; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the
 Cadence Ship, the Cadence Pre-delivery Security Assignment,

 
	
  

 	
  

 	
  

 
	
  

 	
 and “Pre-delivery Security
 Assignments” means any or all of them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Qualifying Charter”
 means, in relation to a Ship, any charterparty in respect of that Ship (other
 than the Charter for that Ship) entered by the relevant Borrower and which
 is:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 with such charterer (which is not a Related Company of the Corporate
 Guarantor);

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 providing for such charterhire and tenor; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 otherwise on such other terms and conditions,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 as are acceptable in all respects to the Agent (acting on the
 instructions of the Majority Banks in their absolute discretion);

 
	
  

 	
  

 	
  

 
	
  

 	
 “Quotation Date” means,
 in respect of any period for which LIBOR is to be determined under this
 Agreement, the second Banking Day before the first day of such period;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Reference Bank” means
 the Agent;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Refund Guarantee”
 means:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the
 Adele Ship, each Adele Refund Guarantee;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the
 Bastian Ship, each Bastian Refund Guarantee; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the
 Cadence Ship, each Cadence Refund Guarantee,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 and “Refund Guarantees”
 means any or all of them;

 
	
  

 	
  

 
	
  

 	
 “Refund Guarantee Assignment
 Consent and Acknowledgement” means:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the
 Adele Ship, each Adele Refund Guarantee Assignment Consent and
 Acknowledgement;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the
 Bastian Ship, each Bastian Refund Guarantee Assignment Consent and
 Acknowledgement; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the
 Cadence Ship, each Cadence Refund Guarantee Assignment Consent and
 Acknowledgement,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 and “Refund Guarantee Assignment
 Consents and Acknowledgements” means any or all of them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Refund Guarantor” means
 The Export-Import Bank of China of No. 30 Fuxingmen Nei Street, Xicheng
 District, Beijing 100031, People’s Republic of China, or such other entity as
 the Agent (acting on the instructions of the Majority Banks in their absolute
 discretion) may approve in writing, and it includes its successors in title;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Registry” means, in
 respect of a Ship, such registrar, commissioner or representative of the
 relevant Flag State who is duly authorised and empowered to register such
 Ship, the relevant Borrower’s title to such Ship and the relevant Mortgage
 under the laws and flag of the relevant Flag State;

 

19

	
  

 	
  

 	
  

 
	
  

 	
 “Related Company” of a
 person means any Subsidiary of such person, any company or other entity of
 which such person is a Subsidiary and any Subsidiary of any such company or
 entity;

 
	
  

 	
  

 	
  

 
	
  

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

 
	
  

 	
  

 	
  

 
	
  

 	
 “Repayment Dates” means,
 subject to clause 6.3 and in respect of the Tranche for each Ship, the
 date falling three (3) months after the Drawdown Date of the Delivery Advance
 for such Ship and each of the dates falling at three (3) monthly intervals
 after such date up to and including the date falling one hundred and twenty
 (120) months after the Drawdown Date of the Delivery Advance for such Ship;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Requisition Compensation”
 means, in relation to a Ship, all sums of money or other compensation from
 time to time payable during the Security Period by reason of the Compulsory
 Acquisition of such Ship;

 
	
  

 	
  

 	
  

 
	
  

 	
 “SAFE” means the State
 Administration for Foreign Exchange of the People’s Republic of China;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Security Agent” means
 DnB NOR Bank ASA, a company incorporated in Norway with its registered office
 at Stranden 21, P.O. Box 1171 Sentrum N-0107 Oslo, Norway, acting for the
 purposes of this Agreement through its branch at 20 St. Dunstan’s Hill,
 London EC3R 8HY, England (or of such other address as may last have been
 notified to the other parties to this Agreement pursuant to clause 17.1.3) or
 such other person as may be appointed as security agent and trustee by the
 Banks, the Agent, the Swap Provider and the Issuing Bank pursuant to
 clause 16.14 and includes its successors in title;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Security Documents”
 means this Agreement, the Master Swap Agreement, the Fee Letters, the
 Mortgages, the Deeds of Covenant, the Charter Assignments, the Account
 Assignments, the Corporate Guarantee, the Swap Assignment and the
 Pre-delivery Security Assignments and any other documents as may have been or
 shall from time to time after the date of this Agreement be executed to
 guarantee and/or secure all or any part of the Loan, interest thereon and
 other moneys from time to time owing by the Borrowers and/or any other
 Security Party pursuant to this Agreement and/or the Master Swap Agreement or
 any other Security Documents (whether or not any such document also secures
 moneys from time to time owing pursuant to any other document or agreement)
 (other than the Manager’s Undertakings);

 
	
  

 	
  

 	
  

 
	
  

 	
 “Security Party” means
 the Borrowers, the Corporate Guarantor or any other person who may at any
 time be a party to any of the Security Documents (other than the Creditors,
 any Manager and the Commercial Parties);

 
	
  

 	
  

 	
  

 
	
  

 	
 “Security Period” means
 the period commencing on the date hereof and terminating upon the later of
 (a) discharge of the security created by the Security Documents by payment of
 all monies payable thereunder and (b) the latest Bank Guarantee Expiry Date;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Security Requirement”
 means, in relation to a Ship, the amount in Dollars (as certified by the
 Agent whose certificate shall, in the absence of manifest error, be
 conclusive and binding on the Borrowers and the other Creditors) which is at
 any relevant time One hundred and twenty five per cent (125%) of the
 aggregate of (a) the Tranche outstanding for such Ship at that time plus (b)
 the Applicable Fraction (relevant to such Ship) of the Swap Exposure at that
 time;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Security
 Value” means, in relation to a Ship, the amount in Dollars (as certified by
 the Agent whose certificate shall, in the absence of manifest error, be
 conclusive and binding on the Borrowers and the other Creditors) which is, at
 any relevant time, the aggregate of (a) the market value of such Ship as most
 recently determined in accordance with clause 8.2.2 and (b) the market value
 of any additional security for the time being actually provided to the
 Creditors or any of them pursuant to clause 8.2.1(b) in connection with the
 Security Requirement relating to such Ship;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Seller” means,
 together, the Builder and CSTC;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Shanghai Costamare”
 means Shanghai Costamare Ship Management Co., Ltd., a company incorporated in
 the People’s Republic of China and having its principal place of business at
 38F Sino

 

20

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Life Tower, 707 Zhangyanglu, Pudong New District, Shangai, People’s
 Republic of China and it includes its successors in title;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Ship”:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the
 Adele Tranche and/or the Adele Borrower, means the Adele Ship;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the
 Bastian Tranche and/or the Bastian Borrower, means the Bastian Ship; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the
 Cadence Tranche and/or the Cadence Borrower, means the Cadence Ship,

 
	
  

 	
  

 	
  

 
	
  

 	
 and “Ships” means any or
 all of them;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Ship Security Documents”:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 in relation to the Adele Ship, means the Adele Mortgage, the Adele
 Deed of Covenant and the Adele Charter Assignment;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 in relation to the Bastian Ship, means the Bastian Mortgage, the
 Bastian Deed of Covenant and the Bastian Charter Assignment; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 in relation to the Cadence Ship, means the Cadence Mortgage, the
 Cadence Deed of Covenant and the Cadence Charter Assignment;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 “SMC” means a safety
 management certificate issued in respect of a Ship in accordance with rule 13
 of the Code;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Standard Form” means,
 in relation to any Ship, the Group’s standard form of Group management agreement
 for vessels of the Group (including the individual form of management
 agreement per vessel) which includes the amounts of remuneration payable to a
 Manager for its services thereunder), as submitted by or on behalf of the
 Borrowers to the Agent prior to this Agreement;

 
	
  

 	
  

 	
  

 
	
  

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

 
	
  

 	
  

 	
  

 
	
  

 	
 “Swap Assignment” means
 the assignment executed or (as the context may require) to be executed by the
 Borrowers in favour of the Security Agent in connection with certain of the
 rights of the Borrowers under the Master Swap Agreement in a form previously
 agreed between the Agent and the Borrowers;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Swap Exposure” means,
 as at any relevant time, the amount certified by the Swap Provider to the
 Agent to be the aggregate net amount in Dollars which would be payable by the
 Borrowers to the Swap Provider under (and calculated in accordance with)
 section 6(e) (Payments on Early Termination) of the Master Swap Agreement if
 an Early Termination Date had occurred at the relevant time in relation to
 all continuing Designated Transactions;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Swap Provider” means
 DnB NOR Bank ASA, a company incorporated in Norway with its registered office
 at Stranden 21, P.O. Box 1171 Sentrum, N-0107 Oslo, Norway acting for the
 purposes of this Agreement through its branch at 20 St. Dunstan’s Hill,
 London EC3R 8HY, England and/or any other office specified in the Master Swap
 Agreement (or of such other address as may last have been notified to the
 other parties to this Agreement pursuant to clause 17.1.3 of the Master Swap
 Agreement) and includes its successors in title; 

 
	
  

 	
  

 	
  

 
	
  

 	
 “Taxes” includes all
 present and future taxes, levies, imposts, duties, fees or charges of
 whatever nature together with interest thereon and penalties in respect
 thereof and “Taxation” shall be
 construed accordingly;

 
	
  

 	
  

 	
  

 
	
  

 	
 “Total Commitment”
 means, at any relevant time, the aggregate of all the Banks’ Commitments at
 such time;

 

21

	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

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

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (a)

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

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 the Compulsory Acquisition of such Ship; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (c)

 	
 the hijacking, theft, condemnation, capture, seizure, arrest,
 detention or confiscation of such Ship (other than where the same amounts to
 the Compulsory Acquisition of such Ship) by any Government Entity, or by
 persons acting or purporting to act on behalf of any Government Entity,
 unless such Ship be released and restored to the relevant Borrower from such
 hijacking, theft, condemnation, capture, seizure, arrest, detention or
 confiscation within ninety (90) days after the occurrence thereof;

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 “Tranche”:

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (a)

 	
 in relation to the
 Adele Ship and/or the Adele Borrower, means the Adele Tranche;

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 in relation to the
 Bastian Ship and/or the Bastian Borrower, means the Bastian Tranche; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (c)

 	
 in relation to the
 Cadence Ship and/or the Cadence Borrower, means the Cadence Tranche,

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 and “Tranches” means any
 or all of them;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 “Transaction” has the
 meaning given to it in the Master Swap Agreement;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 “Transfer Certificate”
 means a certificate in substantially the form set out in schedule 4;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 “Transferee Bank” has
 the meaning ascribed thereto in clause 15.3;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 “Transferor Bank” has
 the meaning ascribed thereto in clause 15.3;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 “Trust Deed” means a
 trust deed in the form, or substantially in the form, set out in schedule 6;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 “Trust Property” means
 (i) the security, powers, rights, titles, benefits and interests (both
 present and future) constituted by and conferred on the Security Agent under
 or pursuant to the Security Documents (including, without limitation, the
 benefit of all covenants, undertakings, representations, warranties and
 obligations given, made or undertaken to the Security Agent in the Security
 Documents), (ii) all moneys, property and other assets paid or transferred to
 or vested in the Security Agent or any agent of the Security Agent or any
 receiver or received or recovered by the Security Agent or any agent of the
 Security Agent or any receiver pursuant to, or in connection with, any of the
 Security Documents whether from any Security Party or any other person and
 (iii) all moneys, investments, property and other assets at any time
 representing or deriving from any of the foregoing, including all interest,
 income and other sums at any time received or receivable by the Security
 Agent or any agent of the Security Agent or any receiver in respect of the
 same (or any part thereof); and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 “Underlying Documents”
 means, together, the Contracts, the Refund Guarantees, the Charters and the
 Management Agreements and “Underlying
 Document” means any of them.

 
	
  

 	
  

 	
  

 	
  

 
	
 1.3

 	
  

 	
 Headings

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

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

 
	
  

 	
  

 	
  

 	
  

 
	
 1.4

 	
  

 	
 Construction of certain terms

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 In this Agreement, unless the context otherwise requires:

 
	
  

 	
  

 	
  

 	
  

 
	
 1.4.1

 	
  

 	
  

 	
 references to clauses and schedules are to be construed as
 references to clauses of, and schedules to, this Agreement and
 references to this Agreement include its schedules;

 

22

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1.4.2

 	
  

 	
  

 	
 references to (or to any specified provision of) this Agreement or
 any other document shall be construed as references to this Agreement, that
 provision or that document as in force for the time being and as amended in
 accordance with terms thereof, or, as the case may be, with the agreement of
 the relevant parties; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1.4.3

 	
  

 	
  

 	
 references to a “regulation”
 include any present or future regulation, rule, directive, requirement,
 request or guideline (whether or not having the force of law, but if not
 having the force of law, one with which the relevant person habitually
 complies) of any agency, authority, central bank or government department or
 any self-regulatory or other national or supra-national authority and, for
 the avoidance of doubt, shall include any Basel 2 Regulation; 

 
	
  

 	
  

 	
  

 	
  

 
	
 1.4.4

 	
  

 	
  

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

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1.4.5

 	
  

 	
  

 	
 references to a time of day are to London time; 

 
	
  

 	
  

 	
  

 	
  

 
	
 1.4.6

 	
  

 	
  

 	
 references to a person shall be construed as references to an
 individual, firm, company, corporation, unincorporated body of persons or any
 Government Entity; 

 
	
  

 	
  

 	
  

 	
  

 
	
 1.4.7

 	
  

 	
  

 	
 “control” means, in
 relation to a body corporate: 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 the power (whether by way of ownership of shares, proxy, contract, agency
 or otherwise, directly or indirectly) to:

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (i)

 	
 cast, or control the casting of, more than 50 per cent of the maximum
 number of votes that might be cast at a general meeting of such body
 corporate; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (ii)

 	
 appoint or remove all, or the majority, of the directors or other
 equivalent officers of such body corporate; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (iii)

 	
 give directions with respect to the operating and financial policies
 of such body corporate with which the directors or other equivalent officers
 of such body corporate are obliged to comply; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 the holding beneficially of more than 50 per cent of the issued share
 capital of such body corporate (excluding any part of that issued share
 capital that carries no right to participate beyond a specified amount in a
 distribution of either profits or capital),

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 and “controlled” shall
 be construed accordingly;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1.4.8

 	
  

 	
  

 	
 two or more persons are “acting in
 concert” if, pursuant to an agreement or understanding (whether
 formal or informal), they actively co-operate, through the acquisition
 (directly or indirectly) of shares in the Corporate Guarantor by any of them,
 either directly or indirectly to obtain or consolidate control of the
 Corporate Guarantor; 

 
	
  

 	
  

 	
  

 	
  

 
	
 1.4.9

 	
  

 	
  

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

 
	
  

 	
  

 	
  

 	
  

 
	
 1.4.10

 	
  

 	
  

 	
 references to the “equivalent”
 of an amount specified in a particular currency (the “first amount”), shall be construed as a
 reference to the net amount of any other currency which the Agent determines
 can be purchased with the first amount in the London foreign exchange market
 at or about 11.00 a.m. on the day on which the calculation falls to be made
 for spot delivery; 

 
	
  

 	
  

 	
  

 	
  

 
	
 1.4.11

 	
  

 	
  

 	
 references to a “demand”
 include any requirement to make payment in accordance with the terms of a
 Bank Guarantee; and 

 
	
  

 	
  

 	
  

 	
  

 
	
 1.4.12

 	
  

 	
  

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

 

23

	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1.5

 	
  

 	
  

 	
 Majority Banks

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Where this Agreement or any other Security Document provides for any
 matter to be determined by reference to the opinion of the Majority Banks or
 to be subject to the consent or request of the Majority Banks or for any
 action to be taken on the instructions in writing of the Majority Banks, such
 opinion, consent, request or instructions shall (as between the Banks) only
 be regarded as having been validly given or issued by the Majority Banks if
 all the Banks shall have received prior notice of the matter on which such
 opinion, consent, request or instructions are required to be obtained and the
 relevant majority of such Banks shall have given or issued such opinion,
 consent, request or instructions but so that (as between the Borrowers and
 the Creditors) the Borrowers shall be entitled (and bound) to assume that
 such notice shall have been duly received by each relevant Bank and that the
 relevant majority shall have been obtained to constitute Majority Banks
 whether or not this is in fact the case.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1.6

 	
  

 	
  

 	
 Banks’ Commitments

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 For the purposes of the definition of “Majority Banks” in clause 1.2, references to the Commitment
 of a Bank shall, if the Total Commitment has, at any relevant time, been
 reduced to zero, be deemed to be a reference to the Commitment of that Bank
 immediately prior to such reduction to zero.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1.7

 	
  

 	
  

 	
 Continuing Defaults

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 For the purposes of this Agreement and the other Security Documents,
 a Default or an Event of Default is “continuing”
 if it has not been remedied or waived.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2

 	
  

 	
  

 	
 The Total
 Commitment, the Advances and the Bank Guarantees 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.1

 	
  

 	
  

 	
 Agreement to lend and to issue Bank
 Guarantees

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.1.1

 	
  

 	
  

 	
  

 	
 The Banks, relying upon each of the representations and warranties in
 clause 7, agree to lend to the Borrowers, jointly and severally, upon and
 subject to the terms of this Agreement, the principal sum of up to Two
 hundred and three million three hundred and forty three thousand Dollars
 ($203,343,000) in twelve (12) Advances comprising three (3) Tranches. The
 obligation of each Bank under this Agreement shall be to contribute that
 proportion of each Advance which, as at the Drawdown Date of such Advance,
 its Commitment bears to the Total Commitment. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.1.2

 	
  

 	
  

 	
  

 	
 The Guarantee Banks and the Issuing Bank, relying upon each of the
 representations and warranties in clause 7, agree that, upon and subject to
 the terms of this Agreement, the Issuing Bank will issue the Bank Guarantees.
 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.1.3

 	
  

 	
  

 	
  

 	
 The Guarantee Banks agree to indemnify and reimburse the Issuing
 Bank, severally and in accordance with their several Percentages, for all
 payments made by the Issuing Bank under each Bank Guarantee. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.2

 	
  

 	
  

 	
 Obligations several

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 The obligations of the Banks under this Agreement are several
 according to their respective Commitments and/or Contributions and the
 obligations of the Guarantee Banks under this Agreement are several according
 to their respective Percentage; the failure of any Bank, or any Guarantee
 Bank or the Issuing Bank to perform such obligations or the failure of the
 Swap Provider to perform its obligations under the Master Swap Agreement
 shall not relieve any other Creditor or the Borrowers or any of them of any
 of their respective obligations or liabilities under this Agreement or, as
 the case may be, the Master Swap Agreement nor shall any Creditor be
 responsible for the obligations of any other Creditor (except for its own
 obligations, if any, as a Bank, Guarantee Bank, Issuing Bank or Swap
 Provider) under this Agreement or the Master Swap Agreement.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.3

 	
  

 	
  

 	
 Interests several

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Notwithstanding any other term of this Agreement (but without
 prejudice to the provisions of this Agreement relating to or requiring action
 by the Majority Banks) the interests of the Creditors are several and the
 amount due to any Creditor is a separate and independent debt. No Creditor
 however

 

24

	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 shall have the right to protect and enforce its rights arising out of
 this Agreement except with the prior written consent of the Majority Banks.
 If however such consent by the Majority Banks is given and a Creditor takes
 any such action, it shall not be necessary for any other Creditor to be
 joined as an additional party in any proceedings for this purpose.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.4

 	
  

 	
 Drawdown and Bank Guarantee issuance

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.4.1

 	
  

 	
  

 	
 Drawdown 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 Subject to the terms and conditions of this Agreement, each Advance
 shall be made to the Borrowers following receipt by the Agent from the
 Borrowers of a Drawdown Notice not later than 10:00 a.m. (Beijing time) on
 the third Banking Day before the date, which shall be a Banking Day falling
 within the Drawdown Period for such Advance, on which the Borrowers propose
 such Advance is made. A Drawdown Notice (i) shall be effective on actual
 receipt by the Agent and (ii) once given, shall, subject as provided in
 clause 3.6.1, be irrevocable.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 Paragraph (a) above shall not apply to any drawdown of an Advance
 made pursuant to clause 2.6.2 or clause 10.2.4.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.4.2

 	
  

 	
  

 	
 Bank Guarantee issuance 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Subject to the terms and conditions of this Agreement, the Issuing
 Bank shall issue a Bank Guarantee, following receipt by the Agent from the
 Borrowers of a Bank Guarantee Request not later than 10:00 a.m. (Beijing
 time) on the third Banking Day before the date, which shall be a Banking Day
 falling within the Guarantee Availability Period, on which the Bank Guarantee
 is to be issued. A Bank Guarantee Request shall be effective on actual
 receipt by the Agent and, once given, shall, subject as provided in clause
 3.6.1, be irrevocable. Upon receipt of a Bank Guarantee Request complying
 with the terms of this Agreement, the Agent shall promptly notify the Issuing
 Bank and each Guarantee Bank accordingly.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.5

 	
  

 	
 Timing, restrictions and limitation of
 Advances and Bank Guarantees

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.5.1

 	
  

 	
  

 	
 The aggregate amount of the Loan shall not exceed the lower of (a)
 Two hundred and three million three hundred and forty three thousand Dollars
 ($203,343,000) and (b) the amount in Dollars which is seventy one point three
 per cent (71.3%) of the aggregate Contract Prices for all Ships. Each Advance
 shall, subject to the following provisions of this clause 2.5, be for such
 amount as is specified in the Drawdown Notice for that Advance. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.5.2

 	
  

 	
  

 	
 The aggregate amount of the Tranche for each Ship shall not exceed
 the lower of (a) $67,781,000 and (b) the amount in Dollars which is seventy
 one point three per cent (71.3%) of the Contract Price for such Ship. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.5.3

 	
  

 	
  

 	
 The aggregate amount of each Contract Instalment Advance shall be as follows:
 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 the first Contract Instalment Advance for each Ship shall not exceed
 the lower of (i) $10,733,000 and (ii) 56.5% of the “2nd Instalment” of the
 Contract Price for the Ship relevant to such Contract Instalment Advance,
 which is payable at the time specified in the third column of schedule 5
 opposite the relevant Contract Instalment Advance; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 each of the second and third Contract Instalment Advances for each
 Ship shall not exceed the lower of (i) $19,016,000 and (ii) the amount in
 Dollars which is equal to one hundred per cent (100%) of the “3rd Instalment”
 or (as the case may be) the “4th Instalment” of the Contract Price for the
 Ship relevant to such Contract Instalment Advance, which is payable at the
 time specified in the third column of schedule 5 opposite the relevant
 Contract Instalment Advance,

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 and each Contract Instalment Advance for a Ship shall be applied in
 or towards payment to the Seller of the relevant aforesaid instalment of the
 Contract Price payable under the Contract for the Ship relevant to such
 Contract Instalment Advance, and shall be made available to the Borrowers
 when such instalment has become due and payable under the relevant Contract.

 

25

	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.5.4

 	
  

 	
  

 	
 Each Delivery Advance: 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 shall not exceed the lower of (i) $19,016,000, (ii) the amount in
 Dollars which is equal to one hundred per cent (100%) of the “5th Instalment”
 of the Contract Price for the Ship relevant to such Advance, (iii) the amount
 in Dollars which, when added to the total amount of the Contract Instalment
 Advances for such Ship actually drawn down, is equal to 71.3% of the Contract
 Price of such Ship and (iv) the amount in Dollars which, when added to the
 total amount of the Contract Instalment Advances for such Ship actually drawn
 down, is equal to $67,781,000; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 shall be applied in or towards payment to the Seller of the “5th
 Instalment” of the Contract Price for such Ship falling due on the relevant
 Delivery Date, and shall be made available to the Borrowers when such
 instalment has become due and payable.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.5.5

 	
  

 	
  

 	
 For the avoidance of doubt, no Advance shall be made available or
 advanced before 30 June 2011 except if the Majority Banks agree otherwise in
 writing in their absolute and unfettered discretion. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.5.6

 	
  

 	
  

 	
 The Outstanding Amount for which each Bank Guarantee is to be issued
 under the terms of this Agreement shall not exceed the lower of (a)
 $9,618,927, (b) the amount in Dollars which is 51% of the total amount of the
 second instalment of the Contract Price of the Ship to which the Bank
 Guarantee relates and (c) such amount which, when aggregated with the
 Outstandings on the proposed Bank Guarantee Issue Date thereof, shall not
 exceed the Facility Commitment. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.6

 	
  

 	
 Availability 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.6.1

 	
  

 	
  

 	
 Following a Drawdown Notice 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Upon receipt of a Drawdown Notice complying with the terms of this
 Agreement, the Agent shall promptly notify each Bank (and, in the case of The
 Export-Import Bank of China and China Everbright Bank only, such notification
 shall be sent by the Agent via a swift message) and, subject to the
 provisions of clause 9, each Bank shall, on the Drawdown Date for the
 relevant Advance, make available to the Agent its portion of the relevant
 Advance for payment by the Agent in accordance with clause 6.2. The Borrowers
 acknowledge that payment of any Advance or part thereof to the Seller or to
 the Borrowers or any of them in accordance with clause 6.2, shall satisfy the
 obligation of the Banks to lend that Advance to the Borrowers under this
 Agreement.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.6.2

 	
  

 	
  

 	
 Following a demand 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 Upon receipt by the Issuing Bank of a demand made under a Bank
 Guarantee in respect of the “2nd Instalment” of the Contract Price of the
 Ship to which that Bank Guarantee relates, the Issuing Bank shall notify the
 Agent and the Banks accordingly. The Banks shall be entitled (following a
 decision made by the Majority Banks in their absolute discretion which shall
 be binding on all the Creditors and the Borrowers), but not bound, to advance
 to the Borrowers forthwith (whether or not at such time the Borrowers are in
 compliance with the relevant provisions of clause 9) the Advance intended to
 finance such instalment of the Contract Price of such Ship. The Banks shall
 advance such Advance by applying it immediately after drawdown in or towards
 discharge (in whole or, as the case may be, in part) of the Borrowers’
 liability to the Issuing Bank under clause 2.7.1 in respect of the relevant
 payment made or (as the context may require) to be made by the Issuing Bank
 under that Bank Guarantee.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 The Banks shall not be entitled to advance any Advance pursuant to
 clause 2.6.2(a) above in relation to a demand made under a Bank Guarantee, if
 on the same day when such demand is made, the Issuing Bank has notified the
 Agent in writing that it has received from the Borrowers the amount which is
 or will become due to the Issuing Bank under clause 2.7.1 in respect of such
 demand once the Issuing Bank shall make the relevant payment under such Bank
 Guarantee.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 If the Banks advance an Advance under paragraph (a) above following a
 payment by the Issuing Bank under a Bank Guarantee, the liability of the
 Borrowers to the Issuing Bank under

 

26

	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 clause 2.7.1 as a result of such payment by the Issuing Bank, shall
 be reduced pro tanto by an
 amount equal to such Advance made.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.6.3

 	
  

 	
  

 	
 Authorisation 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Following receipt of a demand made under a Bank Guarantee in respect
 of the “2nd Instalment” of the Contract Price of the Ship to which that Bank
 Guarantee relates, the Borrowers shall not be entitled to give a Drawdown
 Notice to the Banks for the Advance intended to finance such instalment of
 the Contract Price of such Ship until further notice from the Issuing Bank in
 writing. Each of the Borrowers hereby irrevocably and unconditionally
 authorises and directs the Banks and the Issuing Bank to advance and apply
 such Advance in the manner and at the time referred to in clause 2.6.2 in the
 event that the Banks and the Issuing Bank shall decide or are bound to do so
 pursuant to the terms of such clause 2.6.2.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.6.4

 	
  

 	
  

 	
 Automatic drawdown 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Each of the Borrowers hereby agrees and acknowledges that, once an
 Advance shall have been advanced pursuant to clause 2.6.2 or clause 10.2.4,
 it shall form part of the Loan as if it were drawn down pursuant to clauses
 2.4.1 and 2.6.1.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.7

 	
  

 	
 Payments under Bank Guarantees - constitute
 a loan

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.7.1

 	
  

 	
  

 	
 Each payment (whether of principal or interest) made by the Issuing
 Bank to the Seller under a Bank Guarantee shall constitute a loan advanced by
 the Issuing Bank to the Borrowers jointly and severally. Each such loan shall
 be (a) of a principal amount equal to the amount of such payment (whether of
 principal or interest) made under the relevant Bank Guarantee (less any
 amount received by the Issuing Bank in respect of such payment, whether under
 clause 2.6.2 or clause 14.4 or any other provision of this Agreement or the
 other Security Documents), (b) treated as advanced to the Borrowers jointly
 and severally at the same time as the Issuing Bank made such payment to the
 Seller and (c) due and repayable by the Borrowers at the time advanced to
 them. The Borrowers undertake jointly and severally with the Issuing Bank to
 repay to the Issuing Bank any such amount advanced (or deemed advanced) to
 them pursuant to this clause 2.7.1 on the date when such amount is so
 advanced (or deemed advanced). 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.7.2

 	
  

 	
  

 	
 If the Issuing Bank makes payment under a Bank Guarantee, each
 Guarantee Bank shall, on demand by the Issuing Bank, pay to the Agent for
 account of the Issuing Bank an amount equal to the aggregate of: 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 such Guarantee Bank’s Percentage of the amount of any loan (or part
 thereof) constituted pursuant to clause 2.7.1 in relation to such demand and
 still outstanding; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 interest on such amount, at the rate applicable pursuant to clause
 3.4 in respect of loans owing under clause 2.7.1, from the date of payment by
 the Issuing Bank under the relevant Bank Guarantee, to the date of payment of
 such amount to the Agent by such Guarantee Bank.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 If the Guarantee Banks make a payment to the Agent under this clause
 2.7.2 following a payment by the Issuing Bank under a Bank Guarantee, the
 liability of the Borrowers to the Issuing Bank under clause 2.7.1 as a result
 of such payment by the Issuing Bank, shall be reduced pro tanto by an amount
 equal to such payments made by the Guarantee Banks to the Agent.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.7.3

 	
  

 	
  

 	
 Each payment (whether of principal or interest) made by a Guarantee
 Bank to the Agent for the account of the Issuing Bank under clause 2.7.2 in
 respect of a Bank Guarantee shall constitute a loan advanced by that
 Guarantee Bank to the Borrowers jointly and severally. Such loan shall be (a)
 of a principal amount equal to the amount of such payment (whether originally
 an amount of principal or interest under the relevant Bank Guarantee), (b)
 treated as advanced to the Borrowers jointly and severally at the same time
 as that Guarantee Bank made such payment to the Agent and (c) due and
 repayable by the Borrowers at the time advanced to them. The Borrowers
 undertake jointly and severally with that Guarantee Bank to repay to that
 Guarantee Bank any such amount advanced (or deemed advanced) to them pursuant
 to this clause 2.7.3 on the date when such amount is so advanced (or deemed
 advanced). 

 

27

	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.7.4

 	
  

 	
  

 	
 The Issuing Bank shall be entitled to pay immediately any amount
 (whether of principal or interest) for which a demand or request has been
 made at any time under any Bank Guarantee, with prior notice but without any
 other reference to, or further authority from, the Borrowers and shall not be
 under any duty to investigate or enquire whether any claim or demand on the
 Issuing Bank under such Bank Guarantee shall have been properly made
 notwithstanding that the Borrowers may dispute the validity of such claim or
 demand or that the relevant Borrower may have referred to arbitration under
 the relevant Contract the claim to which the Seller’s demand under such Bank
 Guarantee relates. The liability of the Borrowers to the Issuing Bank under
 clause 2.7.1 or to the Guarantee Banks under clause 2.7.3 shall be in no way
 prejudiced, affected or diminished by the fact that the Issuing Bank was or
 might have been justified in refusing payment of any amount claimed or
 demanded under a Bank Guarantee. 

 
	
  

 	
  

 	
  

 	
  

 
	
 2.7.5

 	
  

 	
  

 	
 If any Guarantee Bank fails, when required pursuant to clause 2.7.2,
 to make a payment to the Agent for the account of the Issuing Bank following
 a demand made under a Bank Guarantee, then until such Guarantee Bank’s
 failure has been remedied in full, the Issuing Bank shall be entitled to the
 benefit of all security then existing or thereafter created to secure the
 obligations of the Borrowers under this Agreement to which such Guarantee
 Bank (whether directly or through the Security Agent) would have been
 entitled had it made such payment and, for the purpose of determining the
 Majority Banks, the Issuing Bank shall be treated as a Bank having
 (additional) Contribution or Commitment equal to the Contribution or
 Commitment of the Guarantee Bank which has failed to make such payment. The
 rights conferred upon the Issuing Bank by this clause 2.7.5 shall be in
 addition and without prejudice to any other rights against such Guarantee
 Bank under clause 2.7.2 or under any other provision of this Agreement or at
 law or otherwise.

 
	
  

 	
  

 	
  

 	
  

 
	
 2.8

 	
  

 	
 Expiration or reduction of Bank Guarantees

 
	
  

 	
  

 	
  

 
	
 2.8.1

 	
  

 	
  

 	
 The Outstanding Amount of a Bank Guarantee shall be treated as
 reduced for the purposes of this Agreement only when and to the extent that
 (a) the Issuing Bank has received a written confirmation (in form and
 substance satisfactory to the Agent and the Issuing Bank in their discretion)
 from the Seller of the amount of such reduction of the relevant Bank
 Guarantee or (b) the Issuing Bank has made a payment under the relevant Bank
 Guarantee. The Issuing Bank shall in each case after a reduction notify the
 Borrowers and the Agent (who shall in turn notify the Guarantee Banks and the
 other Banks) of the amount and the date of such reduction. 

 
	
  

 	
  

 	
  

 	
  

 
	
 2.8.2

 	
  

 	
  

 	
 It is hereby acknowledged and understood that each Bank Guarantee
 shall expire in accordance with its terms. 

 
	
  

 	
  

 	
  

 	
  

 
	
 2.9

 	
  

 	
 Termination of Total Commitment and
 obligation to issue Bank Guarantees

 
	
  

 	
  

 	
  

 
	
 2.9.1

 	
  

 	
  

 	
 Any part of the Total Commitment undrawn and uncancelled at the end
 of the relevant Drawdown Period shall thereupon be automatically cancelled. 

 
	
  

 	
  

 	
  

 	
  

 
	
 2.9.2

 	
  

 	
  

 	
 If any Bank Guarantee is not issued by the end of the Guarantee
 Availability Period, the Issuing Bank’s obligation to issue the same shall
 then be automatically cancelled and the Facility Commitment shall be reduced
 accordingly. 

 
	
  

 	
  

 	
  

 	
  

 
	
 2.10

 	
  

 	
 Application of proceeds

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Without prejudice to the Borrowers’ obligations under clause 8.1.3,
 no Creditor shall have any responsibility for the application of the proceeds
 of the Loan or any part thereof by the Borrowers.

 
	
  

 	
  

 	
  

 
	
 2.11

 	
  

 	
 Derivative transactions

 
	
  

 	
  

 	
  

 
	
 2.11.1

 	
  

 	
  

 	
 If, at any time during the Security Period, the Borrowers wish to
 enter into interest rate swap or other derivative transactions so as to hedge
 all or any part of their exposure under this Agreement to interest rate
 fluctuations, they shall advise the Swap Provider in writing. 

 
	
  

 	
  

 	
  

 	
  

 
	
 2.11.2

 	
  

 	
  

 	
 Any such swap or other derivative transaction shall be concluded with
 the Swap Provider under the Master Swap Agreement provided however that no
 such swap or other derivative transaction shall be concluded unless the Swap
 Provider first agrees to it in writing. For the avoidance of doubt,

 

28

	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 other than the Swap Provider’s agreement in writing referred to in
 the preceding sentence no prior approval is required by the Borrowers from
 any other Creditor before concluding any such transaction. If and when any
 such swap or other derivative transaction has been concluded, it shall
 constitute a Designated Transaction, and the Borrowers shall sign a
 Confirmation with the Swap Provider and advise the Banks through the Agent
 promptly after concluding any Designated Transaction.

 
	
  

 	
  

 	
  

 	
  

 
	
 2.12

 	
  

 	
  “Pre-placement” of Delivery Advances

 
	
  

 	
  

 	
  

 
	
 2.12.1

 	
  

 	
  

 	
 Notwithstanding that the Borrowers may have not yet satisfied all of
 the conditions precedent set out in schedule 3, Part 4 in relation to a Ship,
 in order to facilitate compliance by the relevant Borrower with Article
 II.4(e) of the Contract relevant to that Ship, and provided that: 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 the Borrowers have submitted a relevant Drawdown Notice in accordance
 with clause 2.4; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 in the Agent’s opinion the Borrowers are reasonably likely to satisfy
 all such conditions precedent in relation to that Ship within 4 Banking Days
 from the Drawdown Date and in any event upon the Release (as defined below in
 clause 2.12.2), the Banks may, subject to the other terms and conditions of
 this clause 2.12 and the other provisions of this Agreement, make available
 to the Agent the Delivery Advance for that Ship, on the date specified in the
 relevant Drawdown Notice, being the date on which the “5th Instalment” for
 that Ship is required to be deposited in accordance with Article II.4(e) of
 the Contract with Bank of China (the “Seller’s
 Bank”).

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.12.2

 	
  

 	
  

 	
 Any such Delivery Advance drawn down pursuant to this clause 2.12 (a
 “Pre-placed Advance”) shall
 (subject to the other provisions of this Agreement) be remitted by the Agent
 to the Seller’s Bank as a cash deposit in the Agent’s name with the Seller’s
 Bank (the “Agent Account”) with
 its correspondent bank in New York, and will be held by the Seller’s Bank to
 the order of the Agent for release by the Agent to the Seller (the “Release”) and only subject to such
 irrevocable instructions (the “Irrevocable
 Instructions”) addressed from the Agent to the Seller’s Bank as
 are acceptable to the Agent (acting on the instructions of the Majority
 Banks). 

 
	
  

 	
  

 	
  

 	
  

 
	
 2.12.3

 	
  

 	
  

 	
 The Irrevocable Instructions shall provide (inter alia) that the
 Pre-placed Advance shall not be released to the Seller or to its order, and
 the Agent shall not agree to release a Pre-placed Advance to the Seller or
 its order, unless and until: 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 the Agent is satisfied that the “Protocol of Delivery and Acceptance”
 in respect of the relevant Ship has been signed by the Seller and the
 relevant Borrower and counter-signed by the Agent or one of its duly
 authorised representatives; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 the Agent is satisfied that all the conditions precedent set out in
 schedule 3, Part 4 in respect of that Pre-placed Advance and that Ship have
 been satisfied in full (or as otherwise agreed by the Majority Banks).

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.12.4

 	
  

 	
  

 	
 The Borrowers hereby irrevocably and unconditionally undertake that
 none of the Borrowers shall give any instructions to the Seller’s Bank that
 are inconsistent with any Irrevocable Instructions in respect of a Pre-placed
 Advance. 

 
	
  

 	
  

 	
  

 	
  

 
	
 2.12.5

 	
  

 	
  

 	
 The Borrowers shall immediately prepay a Pre-placed Advance, together
 with interest thereon (calculated in accordance with clause 3.1), on the date
 on which the Seller’s Bank is required to return the moneys funded by that
 Pre-placed Advance to the Agent in accordance with the Irrevocable
 Instructions (and regardless of whether the Seller’s Bank has then carried
 out such instructions), provided that any moneys actually returned to the
 Agent from the Agent Account shall be applied by the Agent in satisfaction of
 such prepayment obligation of the Borrowers and in payment of any amounts
 payable by the Borrowers under clause 4.4 as a result of such prepayment. 

 
	
  

 	
  

 	
  

 	
  

 
	
 2.12.6

 	
  

 	
  

 	
 In case of application of this clause 2.12 in respect of a Pre-placed
 Advance, that Pre-placed Advance shall accrue interest in accordance with the
 terms of clause 3.1 from its Drawdown Date. 

 

29

	
  

 	
  

 	
  

 	
  

 	
  

 
	
 3

 	
  

 	
  

 	
 Interest and
 Interest Periods 

 
	
  

 	
  

 	
  

 	
  

 
	
 3.1

 	
  

 	
  

 	
 Normal interest rate

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 The Borrowers shall pay interest on each Advance or (as the case may
 be) Tranche, in respect of each Interest Period relating thereto on each
 Interest Payment Date (or, in the case of Interest Periods of more than three
 (3) months, by instalments, the first instalment three (3) months from the
 commencement of the Interest Period and the subsequent instalments at
 intervals of three (3) months or, if shorter, the period from the date of the
 preceding instalment until the Interest Payment Date relative to such
 Interest Period) at the rate per annum determined by the Agent to be the
 aggregate of (a) the Margin, (b) LIBOR for such Interest Period and (c)
 Mandatory Cost (if any).

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 3.2

 	
  

 	
  

 	
 Selection of Interest Periods

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Subject to clause 3.3, the Borrowers may by notice received by the
 Agent not later than 10:00 a.m. on the second Banking Day before the
 beginning of each Interest Period specify whether such Interest Period shall
 have a duration of three (3) months or, subject to availability, such other
 period as the Borrowers may select and the Agent may agree in its absolute
 discretion.

 
	
  

 	
  

 	
  

 	
  

 
	
 3.3

 	
  

 	
  

 	
 Determination of Interest Periods

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Every Interest Period shall be of the duration specified by the
 Borrowers pursuant to clause 3.2 but so that:

 
	
  

 	
  

 	
  

 	
  

 
	
 3.3.1

 	
  

 	
  

 	
  

 	
 the initial Interest Period in respect of each Advance shall commence
 on the date such Advance is made and each subsequent Interest Period in
 respect of such Advance shall commence on the last day of the previous
 Interest Period in respect of such Advance; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 3.3.2

 	
  

 	
  

 	
  

 	
 the initial Interest Period in respect of each Advance for a Ship
 drawn down after the first Advance for such Ship to be drawn down shall end
 on the same day as the then current Interest Period for the other drawn
 Advances of the same Tranche and, on such day, all such Advances shall be
 consolidated into, and shall thereafter constitute, the Tranche for that
 Ship; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 3.3.3

 	
  

 	
  

 	
  

 	
 if any Interest Period for a Tranche would otherwise overrun a
 Repayment Date for such Tranche, then, in the case of the last Repayment Date
 for such Tranche, such Interest Period shall end on such Repayment Date, and
 in the case of any other Repayment Date or Repayment Dates for such Tranche,
 the relevant Tranche shall be divided into parts so that there is one part in
 the amount of the repayment instalment or instalments due on each Repayment
 Date for such Tranche falling during that Interest Period and having an
 Interest Period ending on the relevant Repayment Date and another part in the
 amount of the balance of such Tranche having an Interest Period ascertained
 in accordance with clause 3.2 and the other provisions of this clause 3.3;
 and 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 3.3.4

 	
  

 	
  

 	
  

 	
 if the Borrowers fail to specify the duration of an Interest Period
 in accordance with the provisions of clause 3.2 or this clause 3.3 such Interest
 Period shall have a duration of three (3) months or such other period as
 shall comply with this clause 3.3. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 3.4

 	
  

 	
  

 	
 Default interest

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 If the Borrowers fail to pay any sum (including, without limitation,
 any sum payable pursuant to this clause 3.4) on its due date for payment
 under any of the Security Documents (except the Master Swap Agreement), the
 Borrowers shall pay interest on such sum on demand from the due date up to
 the date of actual payment (as well after as before judgment) at a rate
 determined by the Agent pursuant to this clause 3.4. The period beginning on
 such due date and ending on such date of payment shall be divided into
 successive periods of not more than three (3) months as selected by the Agent
 each of which (other than the first, which shall commence on such due date)
 shall commence on the last day of the preceding such period. The rate of
 interest applicable to each such period shall be the aggregate (as determined
 by the Agent) of (a) two per cent (2%) per annum, (b) the Margin, (c) LIBOR
 for such period and (d) the Mandatory Cost (if any). Such interest shall be
 due and payable on the last day of each such period as determined by the
 Agent and each such day shall, for the purposes of this Agreement, be treated
 as an Interest Payment Date, provided that (i) if such unpaid sum is an
 amount of principal which became

 

30

	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 due and payable by reason of a declaration by the Agent under clause
 10.2.2 or a prepayment pursuant to clauses 2.12, 4.3, 8.2.1(a) or 12.1, on a
 date other than an Interest Payment Date relating thereto, the first such
 period selected by the Agent shall be of a duration equal to the period
 between the due date of such principal sum and such Interest Payment Date and
 interest shall be payable on such principal sum during such period at a rate
 of two per cent (2%) above the rate applicable thereto immediately before it
 shall have become so due and payable and (ii) if the Agent selects under this
 clause 3.4 Interest Periods which are shorter than 3 months, interest under
 this clause shall (notwithstanding such selection) only be compounded and
 paid not more frequently than at 3 monthly intervals. If, for the reasons
 specified in clause 3.6.1, the Agent is unable to determine a rate in
 accordance with the foregoing provisions of this clause 3.4, each Bank shall
 promptly notify the Agent of the cost of funds to such Bank and interest on
 any sum not paid on its due date for payment shall be calculated at a rate
 determined by the Agent to be two per cent (2%) per annum above the aggregate
 of the Margin and the cost of funds to such Bank (including Mandatory Cost,
 if any).

 
	
  

 	
  

 	
  

 	
  

 
	
 3.5

 	
  

 	
 Notification of Interest Periods and
 interest rate

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The Agent shall notify the Borrowers, the Banks and the Issuing Bank
 promptly of the duration of each Interest Period and of each rate of interest
 (or, as the case may be default interest) determined by it under this clause
 3.

 
	
  

 	
  

 	
  

 	
  

 
	
 3.6

 	
  

 	
 Market disruption; non-availability

 
	
  

 	
  

 	
  

 	
  

 
	
 3.6.1

 	
  

 	
  

 	
 If and whenever, at any time prior to the commencement of any
 Interest Period: 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 the Agent shall have determined (which determination shall, in the
 absence of manifest error, be conclusive) that adequate and fair means do not
 exist for ascertaining LIBOR during such Interest Period due to circumstances
 affecting the London interbank market generally (and provided always that if
 the screen rate referred to in paragraph (a) of the definition of LIBOR in
 clause 1.2 is available at any relevant time, no person may argue under this
 paragraph (a) that adequate and fair means did not exist for ascertaining
 LIBOR during the relevant Interest Period); or

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 where applicable the Reference Bank does not supply the Agent with a
 quotation for the purpose of calculating LIBOR; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 the Agent shall have received notification from Banks whose aggregate
 Contributions are not less than fifty per cent (50%) of the Loan or, prior to
 the first drawdown, from Banks whose aggregate Commitments are not less than
 fifty per cent (50%) of the Total Commitment, that deposits in Dollars are
 not available to such Banks in the London Interbank Market in the ordinary
 course of business in sufficient amounts to fund their Commitments or their
 Contributions for such Interest Period or that LIBOR does not accurately
 reflect the cost to such Banks of obtaining such deposits,

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 the Agent shall forthwith give notice (a “Determination Notice”) thereof to the Borrowers and to each
 of the Banks and the Swap Provider. A Determination Notice shall contain
 particulars of the relevant circumstances giving rise to its issue. After the
 giving of any Determination Notice the undrawn amount of the Total Commitment
 shall not be borrowed and no Bank Guarantee Request shall be given by the
 Borrowers, until notice to the contrary is given to the Borrowers by the
 Agent.

 
	
  

 	
  

 	
  

 	
  

 
	
3.6.2

 	
  

 	
  

 	
 During the period of thirty (30) days after any Determination Notice
 has been given by the Agent under clause 3.6.1, the Borrowers and the Banks
 shall negotiate in good faith with a view to arriving at a mutually
 acceptable alternative basis for each Bank to maintain its Contribution. If,
 within such 30 day period, no such mutually acceptable alternative basis is
 reached for all the Banks, each Bank shall certify an alternative basis (the
 “Alternative Basis”) for
 maintaining its Contribution. The Alternative Basis may at the relevant
 Bank’s sole and unfettered discretion (without limitation) include
 alternative interest periods, alternative currencies or alternative rates of
 interest but shall include a margin above the cost of funds (including
 Mandatory Cost, if any) to such Bank equivalent to the Margin. The Agent
 shall calculate the arithmetic mean of the Alternative Bases provided by the
 relevant Banks (the “Substitute Basis”)
 and certify the same to the Borrowers, the Banks and the Swap Provider. The
 Substitute Basis so certified shall be binding upon the 

 

31

	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Borrowers and shall take effect in accordance with its terms from the
 date specified in the Determination Notice until such time as the Agent
 notifies the Borrowers that none of the circumstances specified in clause
 3.6.1 continues to exist whereupon the normal interest rate fixing provisions
 of this Agreement shall apply. For so long as any Substitute Basis is in
 force, the Agent shall from time to time (but at least on a monthly basis)
 and in consultation with the Banks, review whether or not the circumstances
 that have caused the application of the Substitute Basis have ceased to
 exist, and if the Majority Banks and the Agent conclude that they have so
 ceased to exist and that such Substitute Basis shall no longer apply, the
 Agent shall notify the Borrowers and the Banks that the Substitute Basis
 shall case to be effective from such date as the Agent shall reasonably
 specify.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4

 	
  

 	
 Repayment and
 prepayment 

 
	
  

 	
  

 	
  

 
	
 4.1

 	
  

 	
 Repayment

 
	
  

 	
  

 	
  

 
	
 4.1.1

 	
  

 	
  

 	
 Subject to the other provisions of this clause 4.1, the Borrowers
 shall repay each Tranche by forty (40) consecutive quarterly repayment
 instalments, one such instalment to be repaid on each of the Repayment Dates
 for such Tranche. Subject to the provisions of this Agreement, the amount of
 each of the first to thirty ninth instalments (inclusive) in respect of each
 such Tranche shall be $1,412,000 and the amount of the fortieth and final
 instalment in respect of each such Tranche shall be $12,713,000 (comprising a
 repayment instalment of $1,412,000 and a balloon payment of $11,301,000 (each
 such balloon payment in relation to a Tranche, a “Balloon Instalment”)). 

 
	
  

 	
  

 	
  

 	
  

 
	
 4.1.2

 	
  

 	
  

 	
 If the Total Commitment in respect of any Tranche is not drawn down
 in full, the amount of each repayment instalment in respect of the relevant
 Tranche (including the relevant Balloon Instalment) shall be reduced
 proportionately. 

 
	
  

 	
  

 	
  

 	
  

 
	
 4.1.3

 	
  

 	
  

 	
 Notwithstanding clause 4.1.1 above, any individual Bank in its
 absolute and unfettered discretion (but acting through the Agent) shall be
 entitled to demand repayment in full of its Contribution to each Tranche on
 the twenty eighth Repayment Date in respect of that Tranche (namely, the
 Repayment Date for that Tranche falling eighty four (84) months after the
 Drawdown Date of the Delivery Advance relating to such Tranche) (the “Early Tranche Maturity Date”) provided
 that it first gives a notice to the Agent under the terms of clause 4.1.5. 

 
	
  

 	
  

 	
  

 	
  

 
	
 4.1.4

 	
  

 	
  

 	
 If one or more Banks (acting through the Agent) exercise such right
 in respect of a Tranche under clause 4.1.3 or under clause 4.1.6, the
 Borrowers shall be obliged to repay the entire Contribution of all such Banks
 to that Tranche in full on the Early Tranche Maturity Date. Each such right
 of a Bank in respect of a Tranche which is exercised under either clause
 4.1.3 or 4.1.6, shall be referred to in this clause 4.1 as an “Early Repayment Option” of that Bank in
 relation to that Tranche. 

 
	
  

 	
  

 	
  

 	
  

 
	
 4.1.5

 	
  

 	
  

 	
 If one or more Banks wish to exercise their right under clause 4.1.3
 in respect of a Tranche, it shall notify the Agent accordingly and the Agent
 shall send to the Borrowers (with a copy to all the Banks) a written demand
 to this effect in respect of that Tranche by not later than ten (10) days
 before the date falling seventy two (72) months after the Drawdown Date of
 the Delivery Advance relating to such Tranche (namely, ten (10) days before
 the twenty fourth Repayment Date for that Tranche). 

 
	
  

 
	
 4.1.6

 	
  

 	
  

 	
 If one or more Banks have exercised their right under clause 4.1.3 in
 respect of a Tranche within the time-frame set out in clause 4.1.5, then the
 remaining Banks (or any of them) shall be entitled to notify the Agent that
 they too wish to exercise the same right in respect of the same Tranche. If a
 Bank wishes to exercise such right under this clause 4.1.6 in respect of a
 Tranche, it shall notify the Agent accordingly and the Agent shall send to
 the Borrowers (with a copy to all the Banks) a written demand to this effect.
 No Bank shall be entitled to exercise such right under this clause 4.1.6 in
 respect of a Tranche, unless: 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 such Bank has notified the Agent accordingly by no later than 180
 days before the Early Tranche Maturity Date relating to such Tranche; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 the Agent has notified the Borrowers (with a copy to the other Banks)
 of such Bank’s intention by no later than 170 days before the Early Tranche
 Maturity Date relating to such Tranche.

 

32

	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.1.7

 	
  

 	
  

 	
 In the event that one or more Banks have exercised an Early Repayment
 Option in respect of a Tranche, the Borrowers shall continue to repay the
 repayment instalments in respect of that Tranche on the same Repayment Dates
 as scheduled and specified in clause 4.1.1 for that Tranche but up to the
 twenty eighth Repayment Date for that Tranche and, on the said twenty eighth
 Repayment Date, in addition to the relevant instalment for that Tranche
 falling due on such date under clause 4.1.1, the Borrowers shall also repay
 the remaining portion of the Contribution to that Tranche of all the Banks
 who have exercised an Early Repayment Option in respect of that Tranche. 

 
	
  

 	
  

 	
  

 	
  

 
	
 4.1.8

 	
  

 	
  

 	
 If one or more Banks (the “Exiting
 Banks”), but not all Banks, have exercised an Early Repayment
 Option in respect of a Tranche, the amount of principal falling due under
 clause 4.1.7 on the Early Tranche Maturity Date for that Tranche shall be
 applied in payment of the repayment instalment falling due on that day under
 clause 4.1.1 and in full prepayment of the Contributions of the Exiting Banks
 to that Tranche. Following such prepayment, the amount of each subsequent
 repayment instalment in respect of the relevant Tranche (including the
 relevant Balloon Instalment) shall be reduced proportionately.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.1.9

 	
  

 	
  

 	
 Each Bank shall be entitled to exercise an Early Repayment Option,
 whether in respect of one Tranche only, or in respect of more or all
 Tranches, and each Bank can exercise it at separate times in respect of each
 Tranche (but subject always to the time limitations of clauses 4.1.5 and
 4.1.6). 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.1.10

 	
  

 	
  

 	
 Neither the Agent nor any Bank shall be obliged to assign any reason
 to any decision of a Bank to exercise an Early Repayment Option. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.2

 	
  

 	
 Voluntary prepayment

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.2.1

 	
  

 	
  

 	
 The Borrowers may prepay any Tranche in whole or part (such part
 being in an amount of Five hundred thousand Dollars ($500,000) or any larger
 sum which is an integral multiple of Five hundred thousand Dollars
 ($500,000)) on any day, without premium or penalty, but subject always to
 their obligations under clause 4.4 (including, without limitation, their
 obligations under clause 11.1 if any such prepayment is made on a day which
 is not an Interest Payment Date relating to the part of the Loan to be
 prepaid). 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.2.2

 	
  

 	
  

 	
 The Borrowers may also prepay (in whole but not in part only),
 without premium or penalty, but without prejudice to their obligations under
 clauses 3.6, 6.6 and 12.2, and subject to their obligations under clause 4.4:
 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 the Contribution of any Bank to which the Borrower shall have become
 obliged to pay additional amounts under clauses 6.6 or 12.2; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 the Contribution of any Bank who has certified an Alternative Basis
 under clause 3.6.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Upon any notice of such prepayment being given under this clause
 4.2.2, the Commitment of the relevant Bank shall be reduced to zero (but, if
 such Bank is also a Guarantee Bank, without prejudice to such Bank’s
 obligations under or in connection with the Guarantee Facility, which shall
 be maintained).

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.3

 	
  

 	
 Prepayment on Total Loss, transfers or
 sales

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.3.1

 	
  

 	
  

 	
 Before issuance of Bank Guarantee and first drawdown 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Immediately prior to the completion of the novation, transfer or
 assignment of a Contract by the relevant Borrower to another person (with the
 prior written consent of the Creditors as and when required by the Security
 Documents), in each case, before the Bank Guarantee Issue Date for the Bank
 Guarantee relevant to such Ship or Contract or before any Advance for such
 Ship is drawn down, then (a) the obligation of the Issuing Bank and the Banks
 to issue the relevant Bank Guarantee and to advance any Advance for such Ship
 (or part thereof) shall immediately cease, (b) the Total Commitment shall be
 reduced by the amount of the Tranche relevant to such Ship and (c) the
 Facility Commitment shall be reduced by the amount of $9,618,927. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.3.2

 	
  

 	
  

 	
 Following issuance of a Bank Guarantee or first drawdown but prior to
 Delivery

 
	
  

 	
  

 	
  

 	
  

 	
  

 

33

	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Immediately prior to the completion of the novation, transfer or
 assignment of a Contract by the relevant Borrower to another person (with the
 prior written consent of the Creditors as and when required by the Security
 Documents), in each case after the Bank Guarantee relevant to such Ship or
 Contract is issued, then (a) the Borrowers shall pay to the Cash Collateral
 Account an amount equal to the then Outstanding Amount of the Bank Guarantee
 relating to such Ship (as determined by the Issuing Bank) and (b) if any
 Advance relating to such Ship has been drawn down, the Borrowers shall prepay
 each such Advance in full and (c) (if applicable) the obligation of the Banks
 to advance any other Advance for that Ship shall immediately cease and the
 Total Commitment shall be reduced accordingly (save that, for the purposes of
 clauses 2.6.2 and 10.2.4 only, the Total Commitment shall be preserved unless
 and until the Borrowers have complied with their obligations under paragraph
 (a) above).

 
	
  

 	
  

 	
  

 	
  

 
	
 4.3.3

 	
  

 	
  

 	
 Thereafter - Mortgaged Ships

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 On the date falling one hundred and eighty (180) days after that on
 which a Mortgaged Ship became a Total Loss or, if earlier, on the date upon
 which the insurance proceeds in respect of such Total Loss are, or
 Requisition Compensation is, received by the relevant Borrower (or the Agent
 or any other Creditor pursuant to the Security Documents), the Borrowers
 shall prepay in full the Tranche relating to such Mortgaged Ship.

 
	
  

 	
  

 	
  

 	
  

 
	
 4.3.4

 	
  

 	
  

 	
 Total Loss

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 For the purpose of this Agreement and the other Security Documents, a
 Total Loss in respect of a Ship shall be deemed to have occurred:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

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

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 in the case of a constructive total loss of a Ship, upon the date and
 at the time notice of abandonment of such Ship is given to the insurers of
 such Ship for the time being;

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

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

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (d)

 	
 in the case of Compulsory Acquisition of a Ship, on the date upon
 which the relevant requisition of title or other compulsory acquisition of
 such Ship occurs; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (e)

 	
 in the case of hijacking, theft, condemnation, capture, seizure,
 arrest, detention or confiscation of a Ship (other than where the same
 amounts to Compulsory Acquisition of such Ship) by any Government Entity, or
 by persons purporting to act on behalf of any Government Entity, which
 deprives the relevant Borrower of the use of such Ship for more than ninety
 (90) days, upon the expiry of the period of ninety (90) days after the date
 upon which the relevant hijacking, theft, condemnation, capture, seizure,
 arrest, detention or confiscation occurred.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.4

 	
  

 	
 Amounts payable on prepayment

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Any prepayment of all or part of the Loan under this Agreement shall
 be made together with: 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.4.1

 	
  

 	
  

 	
 accrued interest on the amount to be prepaid to the date of such
 prepayment; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.4.2

 	
  

 	
  

 	
 any additional amount payable under clauses 6.6 or 12.2; and 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.4.3

 	
  

 	
  

 	
 all other sums payable by the Borrowers to the Creditors under this
 Agreement or any of the other Security Documents including, without
 limitation, any accrued commitment commission payable under clause 5.1 and
 any amounts payable under clause 4.6 or clause 11.

 

34

	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.5

 	
  

 	
  

 	
 Notice of prepayment; reduction of
 repayment instalments

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.5.1

 	
  

 	
  

 	
  

 	
 No prepayment may be effected under clause 4.2 unless the Borrowers
 shall have given the Agent at least twenty (20) days’ prior written notice of
 their intention to make such prepayment. Every notice of prepayment shall be
 effective only on actual receipt by the Agent, shall be irrevocable (unless
 otherwise agreed by the Banks), shall specify the Tranche and the amount
 thereof to be prepaid and shall oblige the Borrowers to make such prepayment
 on the date specified. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.5.2

 	
  

 	
  

 	
  

 	
 Any amount prepaid pursuant to clause 4.2 or clause 8.2.1(a) in
 respect of all the Tranches, shall be applied in prepayment of all Tranches
 proportionately as between them and in reduction of the repayment instalments
 of each Tranche under clause 4.1.1 (including each Balloon Instalment)
 proportionately.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.5.3

 	
  

 	
  

 	
  

 	
 Any amounts prepaid pursuant to clause 4.2 or clause 8.2.1(a) in
 respect of a single Tranche shall be applied in reducing the repayment
 instalments of that Tranche under clause 4.1.1 (including the relevant
 Balloon Instalment) proportionately. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.5.4

 	
  

 	
  

 	
  

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

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.5.5

 	
  

 	
  

 	
  

 	
 No amount prepaid under this Agreement may be reborrowed. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.6

 	
  

 	
  

 	
 Unwinding of Designated Transactions

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 On or prior to any repayment or prepayment of all or part of the Loan
 (including, without limitation, pursuant to clauses 2.12, 4.1, 4.2, 4.3,
 8.2.1(a), 10.2, 12, 14 or any other provision of this Agreement), the
 Borrowers shall, upon the request of the Agent and the Swap Provider, wholly
 or partially reverse, offset, unwind, cancel, close out, net out or otherwise
 terminate one or more of the continuing Designated Transactions so that the
 notional principal amount of the continuing Designated Transactions
 thereafter remaining under the Master Swap Agreement does not, and will not
 in the future (taking into account the scheduled amortisation), exceed the
 amount of the Loan as reducing from time to time thereafter pursuant to
 clause 4.1.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 5

 	
  

 	
  

 	
 Fees, commitment commission
 and expenses 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 5.1

 	
  

 	
  

 	
 Fees

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 The Borrowers shall pay to the Agent:

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 5.1.1

 	
  

 	
  

 	
  

 	
 for the account of the Banks pro rata in accordance with their
 Commitments, on the date of this Agreement, an up-front participation fee of
 such amount as specified in the relevant Fee Letter (for further sharing and
 distribution between the Banks as separately agreed between them); 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 5.1.2

 	
  

 	
  

 	
  

 	
 for the account of the Agent on the date of this Agreement and at
 twelve (12) monthly intervals thereafter until all moneys owing under the
 Security Documents have been repaid in full, an annual agency fee of such
 amount as is specified in the relevant Fee Letter; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 5.1.3

 	
  

 	
  

 	
  

 	
 for the account of each Guarantee Bank pro rata in accordance with their
 Percentages, on the relevant Bank Guarantee Issue Date for each Bank
 Guarantee, an issuance fee for each such Bank Guarantee of such amount as
 specified in the relevant Fee Letter; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 5.1.4

 	
  

 	
  

 	
  

 	
 for the account of each Bank, on each of the dates falling at three
 (3) monthly intervals after 30 June 2011 until the last day of the last
 Drawdown Period, and on the last day of the last Drawdown Period, commitment
 commission computed from 30 June 2011 (in the case of the first payment of
 commission) and from the due date of the preceding payment of commission (in
 the case of each subsequent payment) at the rate of zero point seven five per
 cent (0.75%) per annum on the daily undrawn and available amount of such
 Bank’s Commitment; and 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 5.1.5

 	
  

 	
  

 	
  

 	
 for the account of each Guarantee Bank pro rata in accordance with
 its Percentage, and in relation to each Bank Guarantee, on each of the dates
 falling at three (3) monthly intervals after the relevant 

 

35

	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Bank
 Guarantee Issue Date until the relevant Bank Guarantee Expiry Date, and on
 the relevant Bank Guarantee Expiry Date, guarantee commission computed from
 the relevant Bank Guarantee Issue Date (in the case of the first payment of
 commission) and from the due date of the preceding payment of commission (in
 the case of each subsequent payment) at the daily rate of one point seven
 zero per cent (1.70%) per annum applicable on each such day in respect of
 which such commission has accrued, and payable on the daily Outstanding
 Amount in respect of the relevant Bank Guarantee.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The fees and
 commissions referred to in clause 5.1 (other than those in 5.1.3 and 5.1.5)
 shall be payable by the Borrowers to the Agent, whether or not any part of
 the Total Commitment is ever advanced, whether or not any Bank Guarantee is
 ever issued and whether or not a demand is ever made under any Bank
 Guarantee. All such fees and commissions referred to in clause 5.1 shall be
 non-refundable.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 5.2

 	
  

 	
 Expenses

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The
 Borrowers shall pay to the Agent on a full indemnity basis on demand all
 expenses (including legal, printing and out-of-pocket expenses):

 
	
  

 	
  

 	
  

 
	
5.2.1

 	
  

 	
  

 	
 incurred by
 the Creditors or any of them in connection with the negotiation, preparation,
 execution and, where relevant, registration of: 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 the Security
 Documents; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 any
 amendment (except where such amendment is unilaterally requested by the Agent
 while no Event of Default has occurred) or extension of, or the granting of
 any waiver or consent under, any of the Security Documents; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 the
 syndication of the Loan and any or all of the Security Documents (but not for
 any syndication after the date of this Agreement),

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 provided
 that any such expenses incurred prior to an Event of Default or for as long
 as no Event of Default is continuing shall be reasonable and documented; and

 
	
  

 	
  

 	
  

 	
  

 
	
5.2.2

 	
  

 	
  

 	
 incurred by
 the Creditors or any of them in contemplation of, or otherwise in connection
 with, the enforcement of, or preservation of any rights under, any of the
 Security Documents, or otherwise in respect of the moneys owing under any of
 the Security Documents, 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 together
 with interest at the rate referred to in clause 3.4 from the date on which
 such expenses were incurred to the date of payment (as well after as before
 judgment).

 
	
  

 	
  

 	
  

 
	
5.3

 	
  

 	
 Value added tax

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 All fees and
 expenses payable pursuant to this clause 5 shall be paid together with value
 added tax or any similar tax (if any) properly chargeable thereon. Any value
 added tax chargeable in respect of any services supplied by the Creditors or
 any of them under this Agreement shall, on delivery of the value added tax
 invoice, be paid in addition to any sum agreed to be paid hereunder.

 

36

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 5.4

 	
  

 	
 Stamp and other duties

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The Borrowers shall pay all stamp, documentary, registration or other
 like duties or taxes (including any duties or taxes payable by, or assessed
 against, any of the Creditors) imposed on or in connection with any of the
 Underlying Documents, the Security Documents, the Loan, the Bank Guarantees
 or any amount owing pursuant to clauses 2.7.1 or 2.7.3 (but not duties or
 taxes as a result of a transfer under clause 15.3) and shall indemnify the
 Creditors or any of them against any liability arising by reason of any delay
 or omission by the Borrowers to pay such duties or taxes.

 
	
  

 	
  

 	
  

 	
  

 
	
 6

 	
  

 	
 Payments and
 taxes; accounts and calculations

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 6.1

 	
  

 	
 No set-off or counterclaim

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The Borrowers acknowledge that in performing their respective
 obligations under this Agreement, the Banks will be incurring liabilities to
 third parties in relation to the funding of amounts to the Borrowers, such
 liabilities matching the liabilities of the Borrowers to the Banks and that
 it is reasonable for the Banks to be entitled to receive payments from the
 Borrowers gross on the due date in order that each of the Banks is put in a
 position to perform its matching obligations to the relevant third parties.
 Accordingly, all payments to be made by the Borrowers under any of the
 Security Documents shall be made in full, without any set-off or counterclaim
 whatsoever and, subject as provided in clause 6.6, free and clear of any
 deductions or withholdings, in Dollars on the due date to such account at
 such bank and in such place as the Agent may from time to time specify for
 this purpose. Save for payments which are for the account of the Swap
 Provider and save as otherwise provided in this Agreement or any relevant
 Security Documents, such payments shall be for the account of all Banks, and
 the Agent shall distribute such payments in like funds as are received by the
 Agent to the Banks rateably, in accordance with their respective Commitment
 or (if after the first drawdown) Contribution as the case may be.

 
	
  

 	
  

 	
  

 	
  

 
	
 6.2

 	
  

 	
 Payment by the Banks and the Guarantee
 Banks

 
	
  

 	
  

 	
  

 	
  

 
	
 6.2.1

 	
  

 	
  

 	
 All sums to be advanced by the Banks to the Borrowers under this
 Agreement shall be remitted in Dollars on the Drawdown Date for the relevant
 Advance and, in the case of amounts drawn down pursuant to clause 2.6.1 (but
 not pursuant to clause 2.6.2 or clause 10.2.4) to the account of the Agent at
 such bank as the Agent may have notified to the Banks and shall be paid by
 the Agent on such date in like funds as are received by the Agent to the
 account specified in the Drawdown Notice for such Advance.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 6.2.2

 	
  

 	
  

 	
 All payments to be made by a Guarantee Bank to or for the account of
 the Issuing Bank or the Agent under this Agreement shall be made in full,
 without any set-off or counterclaim whatsoever and, subject as provided in
 clause 6.6.2, free and clear of any deductions or withholdings, in Dollars on
 the due date to the account of the Agent at such bank as the Agent may from
 time to time specify for this purpose and, in the case of payments for the
 account of the Issuing Bank, shall be paid by the Agent on such date in like
 funds as are received by the Agent to the Issuing Bank.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 6.3

 	
  

 	
 Non-Banking Days

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 When any payment under any of the Security Documents would otherwise
 be due on a day which is not a Banking Day, the due date for payment shall be
 extended to the next following Banking Day unless such Banking Day falls in
 the next calendar month in which case payment shall be made on the
 immediately preceding Banking Day.

 
	
  

 	
  

 	
  

 	
  

 
	
 6.4

 	
  

 	
 Calculations

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 All interest and other payments of an annual nature under any of the
 Security Documents shall accrue from day to day and be calculated on the
 basis of actual days elapsed and a three hundred and sixty (360) days year.

 

37

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 6.5

 	
  

 	
 Certificates conclusive

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Any certificate or determination of the Agent or the Security Agent,
 or any Bank, or the Swap Provider or the Issuing Bank as to any rate of
 interest or any other amount pursuant to and for the purposes of any of the
 Security Documents shall, in the absence of manifest error, be conclusive and
 binding on the Borrowers and, in the case of a certificate or determination
 by the Agent or the Security Agent, also on the other Creditors.

 
	
  

 	
  

 	
  

 
	
 6.6

 	
  

 	
 Grossing-up for Taxes

 
	
  

 	
  

 	
  

 
	
 6.6.1

 	
  

 	
  

 	
 If at any
 time the Borrowers or any of them are required to make any deduction or
 withholding in respect of Taxes from any payment due under any of the
 Security Documents for the account of any Creditor or if the Agent or, as the
 case may be, the Security Agent is required to make any such deduction or
 withholding from a payment to another Creditor or withholding in respect of
 Taxes from any payment due under any of the Security Documents, the sum due
 from the Borrowers or any of them in respect of such payment shall be
 increased to the extent necessary to ensure that, after the making of such
 deduction or withholding, the relevant Creditor receives on the due date for
 such payment (and retains, free from any liability in respect of such deduction
 or withholding), a net sum equal to the sum which it would have received had
 no such deduction or withholding been required to be made and the Borrowers
 shall indemnify each Creditor against any losses or costs incurred by it by
 reason of any failure of the Borrowers or any of them to make any such
 deduction or withholding or by reason of any increased payment not being made
 on the due date for such payment. The Borrowers shall promptly deliver to the
 Agent any receipts, certificates or other proof evidencing the amounts (if
 any) paid or payable in respect of any deduction or withholding as aforesaid.

 
	
  

 	
  

 	
  

 	
  

 
	
 6.6.2

 	
  

 	
  

 	
 If at any time any Bank is required to make any deduction or
 withholding in respect of Taxes from any payment due under this Agreement for
 the account of the Agent or the Issuing Bank, the sum due from such Bank in
 respect of such payment shall be increased to the extent necessary to ensure
 that, after the making of such deduction or withholding, the Agent and the
 Issuing Bank receives on the due date for such payment (and retains free from
 any liability in respect of such deduction or withholding) a net sum equal to
 the sum which it would have received had no such deduction or withholding
 been required to be made and each Bank shall indemnify the Agent and the
 Issuing Bank against any losses or costs incurred by either of them by reason
 of any failure of such Bank to make any such deduction or withholding or by
 reason of any increased payment not being made on the due date for such
 payment.

 
	
  

 	
  

 	
  

 	
  

 
	
 6.6.3

 	
  

 	
  

 	
 For the avoidance of doubt, clause 6.6.1 does not apply in respect of
 sums due from the Borrowers to the Swap Provider under or in connection with
 the Master Swap Agreement as to which sums the provisions of section 2(d)
 (Deduction or Withholding for Tax) of the Master Swap Agreement shall apply.

 
	
  

 	
  

 	
  

 	
  

 
	
 6.7

 	
  

 	
 Loan account

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Each Bank and the Issuing Bank shall maintain, in accordance with its
 usual practice, an account evidencing the amounts from time to time lent by,
 owing to and paid to it under the Security Documents. The Agent and/or the
 Security Agent shall maintain a control account (being, in the case of any
 Mortgage which is in statutory form, the “Account Current” referred to in
 such Mortgage) showing the Loan, any amounts owing under clauses 2.7.1 or
 2.7.3, the Outstandings and other sums owing by the Borrowers under the
 Security Documents and all payments in respect thereof being made from time
 to time. The control account shall, in the absence of manifest error, be
 conclusive as to the amount from time to time owing by the Borrowers under
 the Security Documents.

 
	
  

 	
  

 	
  

 
	
 6.8

 	
  

 	
 Agent may assume receipt

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Where any sum is to be paid under the Security Documents to the Agent
 or, as the case may be, the Security Agent for the account of another person,
 the Agent or, as the case may be, the Security Agent may assume that the
 payment will be made when due and the Agent or, as the case may be, the
 Security Agent may (but shall not be obliged to) make such sum available to
 the person so entitled. If it proves to be the case that such payment was not
 made to the Agent or, as the case may be, the Security Agent, then the person
 to whom such sum was so made available shall on request refund such sum to
 the

 

38

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Agent or, as the case may be, the Security Agent together with
 interest thereon sufficient to compensate the Agent or, as the case may be,
 the Security Agent for the cost of making available such sum up to the date
 of such repayment and the person by whom such sum was payable shall indemnify
 the Agent or, as the case may be, the Security Agent for any and all loss or
 expense which the Agent or, as the case may be, the Security Agent may
 sustain or incur as a consequence of such sum not having been paid on its due
 date.

 
	
  

 	
  

 
	
 6.9

 	
  

 	
 Partial payments

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 If, on any date on which a payment is due to be made by the Borrowers
 under any of the Security Documents, the amount received by the Agent from
 the Borrowers falls short of the total amount of the payment due to be made
 by the Borrowers on such date then, without prejudice to any rights or
 remedies available to the Agent, the Security Agent and the Banks under any
 of the Security Documents, the Agent shall apply the amount actually received
 from the Borrowers in or towards discharge of the obligations of the
 Borrowers under the Security Documents in the following order,
 notwithstanding any appropriation made, or purported to be made, by the
 Borrowers:

 
	
  

 	
  

 	
  

 
	
 6.9.1

 	
  

 	
  

 	
 first, in or towards payment, on a pro-rata basis, of any unpaid
 costs and expenses of any Arranger, the Agent, the Security Agent, the
 Issuing Bank and the Swap Provider under any of the Security Documents;

 
	
  

 	
  

 	
  

 	
  

 
	
 6.9.2

 	
  

 	
  

 	
 secondly, in or towards payment, on a pro rata basis, of any fees and
 accrued commissions payable to any Arranger, the Agent or any of the other
 Creditors (other than the Swap Provider) under, or in relation to, the
 Security Documents which remain unpaid;

 
	
  

 	
  

 	
  

 	
  

 
	
 6.9.3

 	
  

 	
  

 	
 thirdly, in or towards payment to the Banks (including Guarantee
 Banks) and the Issuing Bank, on a pro rata basis, of any accrued interest in
 respect of the Loan or in respect of any amounts owing under clauses 2.7.1 or
 2.7.3 which shall have become due under any of the Security Documents (other
 than the Master Swap Agreement) but remains unpaid;

 
	
  

 	
  

 	
  

 	
  

 
	
 6.9.4

 	
  

 	
  

 	
 fourthly, in or towards payment to the Banks (including Guarantee
 Banks) and the Issuing Bank, on a pro rata basis, of any principal in respect
 of the Loan or owing under clauses 2.7.1 or 2.7.3, which shall have become
 due but remains unpaid;

 
	
  

 	
  

 	
  

 	
  

 
	
 6.9.5

 	
  

 	
  

 	
 fifthly, in or towards payment to the Cash Collateral Account of any
 amounts so payable pursuant to the terms of this Agreement or the other
 Security Documents;

 
	
  

 	
  

 	
  

 	
  

 
	
 6.9.6

 	
  

 	
  

 	
 sixthly, in or towards payment to the Banks, on a pro rata basis, for
 any loss suffered by reason of any such payment in respect of principal not
 being effected on an Interest Payment Date relating to the part of the Loan
 repaid and which amounts are so payable under this Agreement; 

 
	
  

 	
  

 	
  

 	
  

 
	
 6.9.7

 	
  

 	
  

 	
 seventhly, in or towards payment to the Swap Provider of any amounts
 owing to it under the Master Swap Agreement; and

 
	
  

 	
  

 	
  

 	
  

 
	
 6.9.8

 	
  

 	
  

 	
 eighthly, in or towards payment to the relevant person of any other
 sum which shall have become due under any of the Security Documents but remains
 unpaid (and, if more than one such sum so remains unpaid, on a pro rata
 basis).

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The order of application set out in clauses 6.9.3 - 6.9.7 may be
 varied by the Agent if the Majority Banks so direct, without any reference
 to, or consent or approval from, the Borrowers.

 
	
  

 	
  

 	
  

 
	
 7

 	
  

 	
 Representations
 and warranties

 
	
  

 	
  

 	
  

 
	
 7.1

 	
  

 	
 Continuing representations and warranties

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The Borrowers jointly and severally represent and warrant to each
 Creditor that:

 
	
  

 	
  

 	
  

 
	
 7.1.1

 	
  

 	
  

 	
 Due incorporation

 

39

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 each of the Borrowers and each of the other Security Parties are duly
 incorporated and validly existing in good standing, in the case of the
 Borrowers, under the laws of the Republic of Liberia and, in the case of each
 of the other Security Parties, under the laws of their respective countries
 of incorporation as limited liability companies or (as the case may be)
 corporations and have power to carry on their respective businesses as they
 are now being conducted and to own their respective property and other assets;

 
	
  

 	
  

 	
  

 	
  

 
	
 7.1.2

 	
  

 	
  

 	
 Corporate power

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

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

 
	
  

 	
  

 	
  

 	
  

 
	
 7.1.3

 	
  

 	
  

 	
 Binding obligations

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 the Underlying Documents and the Security Documents constitute or
 will, when executed, constitute valid and legally binding obligations of the
 relevant Security Parties enforceable in accordance with their respective
 terms;

 
	
  

 	
  

 	
  

 	
  

 
	
 7.1.4

 	
  

 	
  

 	
 No conflict with other obligations

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 the execution and delivery of, the performance of their obligations
 under, and compliance with the provisions of, the Underlying Documents and
 the Security Documents by the relevant Security Parties will not:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 contravene any existing applicable law, statute, rule or regulation
 or any judgment, decree or permit to which any of the Borrowers or any other
 Security Party is subject;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 conflict with, or result in any breach of any of the terms of, or
 constitute a default under, any agreement or other instrument to which any of
 the Borrowers or any other Security Party is a party or is subject or by
 which it or any of its property is bound;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 contravene or conflict with any provision of the constitutional
 documents of any of the Borrowers or any other Security Party; or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (d)

 	
 result in the creation or imposition of or oblige any of the
 Borrowers or any other Security Party to create any Encumbrance (other than a
 Permitted Encumbrance) on any of the undertakings, assets, rights or revenues
 of any of the Borrowers or any other Security Party;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.1.5

 	
  

 	
  

 	
 No filings required

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

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

 
	
  

 	
  

 	
  

 	
  

 
	
 7.1.6

 	
  

 	
  

 	
 Choice of law

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 the choice of English law to govern the Underlying Documents and the
 Security Documents (other than the Mortgages) and the choice of the law of
 the relevant Flag State to govern each of the Mortgages, and the submissions
 therein by the Security Parties to the non-exclusive jurisdiction of the
 English courts are valid and binding;

 

40

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.1.7

 	
  

 	
  

 	
 No immunity

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

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

 
	
  

 	
  

 	
  

 	
  

 
	
 7.1.8

 	
  

 	
  

 	
 Consents obtained

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 every consent, authorisation, licence or approval of, or registration
 with or declaration to, governmental or public bodies or authorities or
 courts required by any Security Party to authorise, or required by any
 Security Party in connection with, the execution, delivery, validity,
 enforceability or admissibility in evidence of each of the Underlying
 Documents and each of the Security Documents to which it is or is to be a
 party or the performance by each Security Party of its obligations under the
 Security Documents or the Underlying Documents to which it is or is to be a
 party has been obtained or made and is in full force and effect and there has
 been no default in the observance of any of the conditions or restrictions
 (if any) imposed in, or in connection with, any of the same; 

 
	
  

 	
  

 	
  

 	
  

 
	
 7.1.9

 	
  

 	
  

 	
 Financial statements correct and complete

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 the audited
 consolidated financial statements of the Corporate Guarantor in respect of
 the financial year ended on 31 December 2009 as delivered to the Agent, have
 been prepared in accordance with the Applicable Accounting Principles which
 have been consistently applied and present fairly and accurately the consolidated
 financial position of the Corporate Guarantor as at the date they were
 prepared and the consolidated results of the operations of the Corporate
 Guarantor for the financial period ended on such date and, as at such date,
 no member of the Corporate Guarantor had
 any significant liabilities (contingent or otherwise) or any material
 unrealised or anticipated losses which are not disclosed by, or reserved
 against or provided for in, such financial statements; and

 
	
  

 	
  

 	
  

 	
  

 
	
 7.1.10

 	
  

 	
  

 	
 Borrowers’ own account

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 in relation to the borrowing by each Borrower of the Loan or any part
 thereof, the performance and discharge of its obligations and liabilities
 under the Security Documents and the transactions and other arrangements
 effected or contemplated by this Agreement, each Borrower is acting for its
 own account and that the foregoing will not involve or lead to a
 contravention of any law, official requirement or other regulatory measure or
 procedure which has been implemented to combat “money laundering” (as
 defined in Article 1 of the Directive (91/308/EEC) of the Council of the
 European Communities (as amended)).

 
	
  

 	
  

 	
  

 	
  

 
	
 7.2

 	
  

 	
 Initial representations and warranties

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The Borrowers jointly and severally further represent and warrant to
 each Creditor that:

 
	
  

 	
  

 	
  

 
	
 7.2.1

 	
  

 	
  

 	
 Pari passu and subordinated indebtedness

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 the obligations of each Borrower under this Agreement and the Master
 Swap Agreement are direct, general and unconditional obligations of such
 Borrower and rank at least pari passu with all other present and future
 unsecured and unsubordinated Indebtedness of such Borrower except for
 obligations which are mandatorily preferred by operation of law and not by
 contract;

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 any Indebtedness of the Borrowers or the Corporate Guarantor owing to
 any of its respective shareholders or other members of the Group is
 subordinated in all respects to the Borrowers’ obligations under this
 Agreement and the Master Swap Agreement (in the case of the Borrowers) and to
 the Corporate Guarantor’s obligations under the Corporate Guarantee (in the
 case of the Corporate Guarantor);

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.2

 	
  

 	
  

 	
 No default under other Borrowed Money 

 

41

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 none of the Borrowers nor any other Security Party is in breach of or
 in default under any agreement relating to Borrowed Money to which it is a
 party or by which it may be bound;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.3

 	
  

 	
  

 	
 Information
 - full disclosure

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 the information, exhibits and reports furnished by or on behalf of
 any Security Party to the Agent and/or the Arrangers in connection with the
 negotiation and preparation of the Security Documents are true and accurate
 in all material respects and not misleading and are based on reasonable
 assumptions; do not omit material facts and all reasonable enquiries have
 been made to verify the facts and statements contained therein; there are no
 other facts the omission of which would make any fact or statement therein misleading;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.4

 	
  

 	
  

 	
 No
 withholding Taxes

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 no Taxes are imposed by withholding or otherwise on any payment to be
 made by any of the Borrowers or any other Security Party under the Security
 Documents to which such Borrower or any other Security Party is or is to be a
 party or are imposed on or by virtue of the execution or delivery by the
 Borrowers or any other Security Parties of the Security Documents;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.5

 	
  

 	
  

 	
 No Event of Default

no Event of Default has occurred and is
 continuing; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.6

 	
  

 	
  

 	
 No default under Contracts or Refund Guarantees 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 no Borrower is in default of any of its obligations under the
 relevant Contract or any of its obligations upon the performance or
 observance of which depends the continued liability of the Refund Guarantor
 in accordance with the terms of any Refund Guarantee;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.7

 	
  

 	
  

 	
 No Encumbrance in respect of pre-delivery security

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 no Borrower has previously charged, encumbered or assigned the
 benefit of any of its rights, title and interest in or to the relevant
 Contract or any Refund Guarantee and such benefit and all such rights, title
 and interest are freely assignable and chargeable in the manner contemplated
 by the Security Documents;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.8

 	
  

 	
  

 	
 The Ships

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 each Ship
 will, on the Delivery Date relevant to such Ship, be:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 in the absolute ownership of the relevant Borrower who will, on and
 after its Delivery Date, be the sole, legal and beneficial owner of such
 Ship;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 registered through the offices of the relevant Registry as a ship
 under the laws and flag of the relevant Flag State;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 operationally seaworthy and in every way fit for service; and 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (d)

 	
 classed with the relevant Classification free of all requirements and
 recommendations of the relevant Classification Society; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.9

 	
  

 	
  

 	
 Ships’ employment

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 save under the Charters, none of the Ships is nor will, on or before
 the Drawdown Date of the Delivery Advance relevant to such Ship, be subject
 to any charter or contract or to any agreement to enter into any charter or
 contract which, if entered into after the date of the relevant Ship Security
 Documents would have required the consent of the Agent or, as the context may
 require, the Security Agent and, on or before the Drawdown Date of the
 Delivery Advance relevant to such Ship, there will not be any agreement or
 arrangement whereby the Earnings may be shared with any other person; 

 

42

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.10

 	
  

 	
  

 	
 Freedom from
 Encumbrances 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 no Ship, nor its Earnings, Insurances or Requisition Compensation nor
 the Accounts nor the Charters nor any other properties or rights which are,
 or are to be, the subject of any of the Security Documents nor any part
 thereof will be, on the Drawdown Date of the Delivery Advance relevant to
 such Ship, subject to any Encumbrance (except Permitted Encumbrances);

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.11

 	
  

 	
  

 	
 Compliance with Environmental Laws and Approvals 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

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

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 the Borrowers and, to the best of the Borrowers’ knowledge and belief
 (having made due enquiry), their respective Environmental Affiliates have
 complied with the provisions of all Environmental Laws;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

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

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 neither the Borrowers nor, to the best of the Borrowers’ knowledge
 and belief (having made due enquiry), any of their respective Environmental
 Affiliates have received notice of any Environmental Claim that any of the
 Borrowers or any such Environmental Affiliate is not in compliance with any
 Environmental Law or any Environmental Approval;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.12

 	
  

 	
  

 	
 No Environmental Claims 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 except as may already have been disclosed by the Borrowers in writing
 to, and acknowledged in writing by, the Agent, there is no Environmental
 Claim pending against the Borrowers or any of the Ships or, to the best of
 the Borrowers’ knowledge and belief (having made due enquiry), any of their
 respective Environmental Affiliates;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.13

 	
  

 	
  

 	
 No potential Environmental Claims 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 except as may already have been disclosed by the Borrowers in writing
 to, and acknowledged in writing by, the Agent, there has been no emission,
 spill, release or discharge of a Pollutant from any of the Ships owned by,
 managed or crewed by or chartered to the Borrowers;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.14

 	
  

 	
  

 	
 Underlying Documents 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 the original executed Refund Guarantees (or, if sent by swift message
 to the Agent, the copies thereof) delivered or to be delivered to the Agent
 pursuant to clause 9.1 are, or will when delivered be, true and complete
 originals of such documents and the copies of the other Underlying Documents
 delivered or to be delivered to the Agent pursuant to clause 9.1 or any of
 the other provisions of the Security Documents are, or will when delivered
 be, true and complete copies of such documents; and all such documents
 constitute valid and binding obligations of the Security Parties and, to the
 Borrowers’ knowledge and belief, of the other parties thereto, enforceable in
 accordance with their respective terms and there have been no amendments or
 variations thereof or defaults thereunder;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.15

 	
  

 	
  

 	
 Shareholding 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 each of the Borrowers is a wholly-owned direct Subsidiary of the
 Corporate Guarantor;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 no less than 40% of the total issued share capital and of the total
 issued voting share capital of the Corporate Guarantor is ultimately
 beneficially owned (either directly and/or through companies beneficially
 owned by members of the Konstantakopoulos Family and/or trusts or foundations
 controlled by the Konstantakopoulos Family, or of which members of the
 Konstantakopoulos Family are beneficiaries), by members of the
 Konstantakopoulos Family;

 

43

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 the Corporate Guarantor is controlled by members of the
 Konstantakopoulos Family; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (d)

 	
 each of the Managers is controlled by members of the
 Konstantakopoulos Family;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.16

 	
  

 	
  

 	
 No litigation

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 no litigation, arbitration, investigation or proceeding (administrative
 or otherwise) is taking place against any of the Borrowers or any other
 Security Party which could have a material adverse effect on the financial
 position, state of affairs or prospects of any of the Borrowers or the
 Corporate Guarantor or any other Security Party in light of which there is a
 significant risk that the Corporate Guarantor or any Borrower or any other
 Security Party is, or will later become, unable to discharge its liabilities
 under the Security Documents as they fall due;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.17

 	
  

 	
  

 	
 No material adverse change 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 no event has occurred or any other circumstances arisen or developed
 including, without limitation, a material adverse change in the financial
 position, state of affairs or prospects of any Security Party, in light of
 which there is a significant risk that the Corporate Guarantor or any
 Borrower or any other Security Party is, or will later become, unable to
 discharge its liabilities under the Security Documents as they fall due;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.18

 	
  

 	
  

 	
 Solvency 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 none of the Borrowers nor the Corporate Guarantor is unable, or
 admits or has admitted its inability, to pay its debts or has suspended
 making payments on any of its debts;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 none of the Borrowers nor the Corporate Guarantor by reason of actual
 financial difficulties has commenced negotiations with one or more of its
 creditors with a view to rescheduling any of its Indebtedness; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 no moratorium has been declared in respect of any Indebtedness of any
 Borrower or the Corporate Guarantor;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.19

 	
  

 	
  

 	
 ISPS Code 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 with effect on the Delivery Date of a Ship, the relevant Borrower
 shall have a valid and current ISSC in respect of that Ship and that Ship
 shall be in compliance with the ISPS Code; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.2.20

 	
  

 	
  

 	
 Application for DOC and SMC 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 the Operator maintains a DOC for itself and, on the Delivery Date for
 a Ship, it will have applied for an SMC in respect of such Ship.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.3

 	
  

 	
 Repetition of representations and
 warranties 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 On and as of each Drawdown Date and on each Bank Guarantee Issue Date
 and (except in relation to the representations and warranties in clause 7.2)
 on each Interest Payment Date, the Borrowers shall:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 be deemed to repeat the representations and warranties in clauses 7.1
 and 7.2 as if made with reference to the facts and circumstances existing on
 such day; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 be deemed to further represent and warrant to each of the Creditors
 that the then latest management accounts of the Borrowers delivered to the
 Agent by the Borrowers under this Agreement (if any) present fairly and
 accurately the financial position of the Borrowers as at the end of the
 financial period to which the same relate and the results of the operations
 of the Borrowers for the financial period to which the same relate and, as at
 the end of such financial period, none of the Borrowers had any significant
 liabilities (contingent or otherwise) or any material unrealised or
 anticipated losses which are not disclosed by, or reserved against or
 provided for in, such management accounts.

 

44

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8

 	
  

 	
 Undertakings 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1

 	
  

 	
 General

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The Borrowers jointly and severally undertake with each Creditor
 that, from the date of this Agreement and so long as any moneys are owing
 under any of the Security Documents and while all or any part of the Total
 Commitment remains outstanding or while the Facility Commitment is
 outstanding, they will:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.1

 	
  

 	
  

 	
 Notice of Event of Default

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 promptly inform the Agent of any occurrence of which any of them
 becomes aware which materially and adversely affects the ability of any
 Security Party to perform its obligations under any of the Security Documents
 or any of the Contracts to which it is or is to be a party and, without
 limiting the generality of the foregoing, they will inform the Agent of any
 Event of Default forthwith upon becoming aware thereof; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 promptly inform the Agent of any occurrence of which any of them
 becomes aware which materially and adversely affects the ability or rights of
 any Borrower to make any claims under the relevant Contract or any Refund
 Guarantee or which might reduce or release any of the obligations of the
 Builder or CSTC under such Contract or the Refund Guarantor under any Refund
 Guarantee;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.2

 	
  

 	
  

 	
 Consents and licences

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 without prejudice to clauses 7.1 and 9, obtain or cause to be
 obtained, maintain in full force and effect and comply in all material
 respects with the conditions and restrictions (if any) imposed in, or in
 connection with, every consent, authorisation, licence or approval of
 governmental or public bodies or authorities or courts and do, or cause to be
 done, all other acts and things which may from time to time be necessary
 under applicable law for the continued due performance of all the material
 obligations of the Security Parties under each of the Security Documents and
 the Underlying Documents;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.3

 	
  

 	
  

 	
 Use of proceeds

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 use the Loan or, as the case may be, the Advances for their own
 benefit and under their full responsibility and exclusively for the purposes
 specified in clauses 1.1 and 2.5;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.4

 	
  

 	
  

 	
 Pari passu and subordination

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 ensure that
 their obligations under this Agreement and the Master Swap Agreement shall,
 without prejudice to the provisions of clause 8.3 and the security intended
 to be created by the Security Documents, at all times rank at least pari
 passu with all their other present and future unsecured and unsubordinated
 Indebtedness with the exception of any obligations which are mandatorily
 preferred by law and not by contract; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 ensure that the obligations (if any) of the Borrowers to repay any
 loan advanced to them by their shareholders or any other member of the Group
 are at all times fully subordinated towards their obligations to the
 Creditors under this Agreement and the other Security Documents and that any
 such loans or advances are and remain at all times on terms and conditions
 acceptable to the Agent in all respects;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.5

 	
  

 	
  

 	
 Financial statements

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 upon the Agent’s request, prepare or cause to be prepared unaudited
 management accounts of each of the Borrowers in respect of each financial
 year (including prior financial years) and deliver as many copies of the same
 as the Agent may reasonably require as soon as practicable but not later than
 the later of (a) thirty (30) days from the Agent’s request and (b) one
 hundred and eighty (180) days from the end of the financial period to which
 they relate;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.6

 	
  

 	
  

 	
 Delivery of reports

 

45

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 deliver to the Agent sufficient copies for all the Banks of every
 report, circular, notice or like document issued by the Borrowers or the
 Corporate Guarantor to their shareholders or creditors generally, at the same
 time when it is issued or given, unless the Borrowers have already advised
 the Agent in writing that such information appears on the official website of
 any one of the Corporate Guarantor, the New York Stock Exchange or the
 Securities and Exchange Commission of the U.S.A.;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.7

 	
  

 	
  

 	
 Provision of further information

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 provide the Agent with such financial and other information
 concerning the Borrowers, the other Security Parties and their respective
 affairs as the Agent may from time to time reasonably require, including,
 without limitation, regarding their financial standing, commitments,
 operations, vessel sales or purchases, any new borrowings, any material
 litigation, arbitration and administrative proceedings and all major
 financial developments in relation to each Security Party;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.8

 	
  

 	
  

 	
 Know your customer information

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 deliver to the Agent such documents and evidence as the Agent shall
 from time to time require relating to the verification of identity and
 knowledge of the Agent’s or any Bank’s or the Swap Provider’s or the Issuing
 Bank’s customers and the compliance by the Agent or any Bank or the Swap
 Provider or the Issuing Bank (as the case may be) with all necessary “know
 your customer” or similar checks, always on the basis of applicable laws and
 regulations or the Agent’s or any Bank’s or any Swap Provider’s or the
 Issuing Bank’s own internal guidelines, in each case as such laws,
 regulations or internal guidelines apply from time to time;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.9

 	
  

 	
  

 	
 Obligations under Security Documents

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 and will procure that each of the other Security Parties will, duly
 and punctually perform each of the obligations expressed to be assumed by it
 under the Security Documents and the Underlying Documents to which it is a
 party;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.10

 	
  

 	
  

 	
 Compliance with Code

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 and will procure that any Operator will, comply with and ensure that
 the Ships and any Operator at all times complies with the requirements of the
 Code, including (but not limited to) the maintenance and renewal of valid
 certificates pursuant thereto throughout the Security Period;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.11

 	
  

 	
  

 	
 Withdrawal of DOC and SMC

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 and will procure that any Operator will, immediately inform the Agent
 if there is any withdrawal of such Operator’s DOC or the SMC in respect of
 any of the Ships;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.12

 	
  

 	
  

 	
 Issuance of DOC and SMC

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 and will procure that any Operator will, promptly inform the Agent
 upon the issue to any of the Borrowers or any Operator of a DOC and to any of
 the Ships of an SMC or the receipt by any of the Borrowers or any Operator of
 notification that its application for the same has been refused;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.13

 	
  

 	
  

 	
 ISPS Code Compliance

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 and will procure that the relevant Manager(s) or any Operator will,
 with effect from the Delivery Date for a Ship and at all times thereafter:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 maintain at all times a valid and current ISSC in respect of that
 Ship; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 immediately notify the Agent in writing of any suspension, cancellation
 or modification of the ISSC in respect of a Ship;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.14

 	
  

 	
  

 	
 Conditions subsequent - Bank Guarantees

 

46

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 deliver to the Agent:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 not later than 15 days after the Bank Guarantee Issue Date of the
 Bank Guarantee in respect of a Ship:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (i)

 	
 the Refund Guarantee Assignment Consent and Acknowledgement in
 respect of the Refund Guarantee for the “1st Instalment” of the Contract
 Price for that Ship, duly executed by the parties thereto;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (ii)

 	
 the Contract Assignment Consent and Acknowledgement for that Ship,
 duly executed by the parties thereto; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (iii)

 	
 evidence in form and substance satisfactory to the Agent of the
 authority of the parties executing the above said acknowledgments (except, in
 the case of paragraph (i), if the relevant acknowledgment has been sent to
 the Agent by swift); 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (iv)

 	
 an acknowledgement from the Charterer of the notice of assignment of
 each Charter under each Charter Assignment, each in the form prescribed in
 each Charter Assignment; and 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 not later than 60 days after the Bank Guarantee Issue Date of the
 Bank Guarantee in respect of a Ship:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (i)

 	
 evidence that the Refund Guarantee for that Ship relating to the “1st
 Instalment” of the Contract Price for that Ship has been duly registered with
 SAFE; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (ii)

 	
 a legal opinion (at the expense of the Borrowers) issued by the
 Agent’s special legal advisers on matters of Chinese law in form and
 substance satisfactory to the Agent (it being understood that, as is
 customary in banking practice, the procurement of the legal opinion will be
 the responsibility of the Agent and its legal counsel); 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.15

 	
  

 	
  

 	
 Conditions subsequent - First Advances; Delivery Advances

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 deliver to the Agent:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 not later than 15 days after the Drawdown Date of the first Advance
 in respect of a Ship:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (i)

 	
 the Refund Guarantee Assignment Consent and Acknowledgement in
 respect of the Refund Guarantee for all pre-delivery instalments (except the
 “1st Instalment”) of the Contract Price for that Ship, duly executed by the
 parties thereto; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (ii)

 	
 evidence in form and substance satisfactory to the Agent of the
 authority of the relevant Refund Guarantor executing the above said
 acknowledgement (except if the same has been sent to the Agent by swift); 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 not later than 60 days after the Drawdown Date of the first Advance
 in respect of a Ship:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (i)

 	
 evidence that the Refund Guarantee for that Ship relating to all
 pre-delivery instalments (except the “1st Instalment”) of the Contract Price
 for that Ship has been duly registered with SAFE; and 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (ii)

 	
 a legal opinion (at the expense of the Borrowers) issued by the
 Agent’s special legal advisers on matters of Chinese law in form and
 substance satisfactory to the Agent (it being understood that, as is
 customary in banking practice, the procurement of the legal opinion will be
 the responsibility of the Agent and its legal counsel); and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 not later than 24 hours after the Delivery of a Ship, evidence in
 form and substance satisfactory to the Agent that the Charterer has accepted
 delivery of that Ship under the relevant Charter (it being agreed that
 evidence that the first payment of hire under such Charter or written
 schedule

 

47

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 or directions by the Charterer for the employment of that Ship under
 such Charter shall constitute such evidence satisfactory to the Agent for the
 purposes of this paragraph (c)); and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.16

 	
  

 	
  

 	
 Supervision

 
	
  

 
	
  

 	
  

 	
  

 	
 ensure that each Borrower, or the relevant Manager(s) or any other
 person appointed by the relevant Manager(s) (but no other person), will
 supervise and superintend the construction of its Ship; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.17

 	
  

 	
  

 	
 Charters etc.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 advise the Agent promptly of any charterparty or other contract of
 employment of a Ship with a tenor exceeding twelve (12) months (other than
 the Charters), forthwith after its execution and: 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 forthwith after its execution deliver a certified copy of each such
 charterparty or other contract of employment to the Agent; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 forthwith following demand by the Agent execute:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (i)

 	
 a charter assignment of any such charterparty or other contract of
 employment in favour of the Security Agent in a form similar to that of the
 Charter Assignments; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (ii)

 	
 any notice of assignment required in connection therewith in a form
 acceptable to the Agent in its reasonable discretion; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 promptly procure the service of any such notice of assignment on the
 relevant charterer and the acknowledgement of such notice by the relevant
 charterer in a form reasonably acceptable to the Agent and the relevant
 charterer; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (d)

 	
 forthwith on the Agent’s request, deliver to the Agent such documents
 of the type specified in schedule 3 in relation to any such charterparty,
 contract, assignment, notice or acknowledgement as the Agent may reasonably
 require and which are available to the Borrowers; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (e)

 	
 pay all legal and other costs incurred by the Agent or any other
 Creditor in connection with any such charter assignments or any other matters
 referred to in this clause 8.1.7 forthwith following the Agent’s demand
 (provided that any such expenses incurred prior to an Event of Default shall
 be reasonable and documented); 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.18

 	
  

 	
  

 	
 Taxes

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 and will procure that the Corporate Guarantor will, pay any and all
 Taxes owing by it in any jurisdiction at the time they are due; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.1.19

 	
  

 	
  

 	
 Change of Manager

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 ensure that, on or before the appointment of any person as a manager
 of a Ship (and subject always to the consent of the Creditors if and when the
 same is required under the Security Documents), they will:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 deliver to the Agent a certified copy of the Management Agreement
 duly executed by that Manager and the Borrower owning such Ship;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 procure that such Manager will have created and delivered to the
 Agent a Manager’s Undertaking in respect of that Ship before such Manager’s
 appointment has become effective under that Management Agreement; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 deliver to the Agent any documents and evidence of the type referred
 to in schedule 3 in relation to that Manager’s Undertaking and that Manager
 as the Agent may in its reasonable discretion require,

 

48

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 each at the cost and expense of the Borrowers.

 
	
  

 	
  

 	
  

 
	
 8.2

 	
  

 	
 Security value maintenance

 
	
  

 	
  

 	
  

 
	
 8.2.1

 	
  

 	
  

 	
 Security shortfall

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 If, at any time after the Drawdown Date of the Delivery Advance in
 respect of a Ship:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (1)

 	
 a Charterer Event has occurred in relation to that Ship and at that
 time and for as long as that Ship has not yet become subject to, and
 delivered for service under, a Qualifying Charter, the Security Value for
 that Ship shall be less than the Security Requirement for such Ship; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (2)

 	
 a New Charterer Event has occurred in relation to that Ship and at that
 time and for as long as that Ship has not yet become subject to, and
 delivered for service under, another Qualifying Charter, the Security Value
 for that Ship shall be less than the Security Requirement for such Ship, 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 the Agent (acting on the instructions of the Majority Banks) shall
 give notice to the Borrowers requiring that such deficiency be remedied and
 then the Borrowers shall, within a period of thirty (30) days of the date of
 receipt by the Borrowers of the Agent’s said notice, either:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 prepay such part of the Tranche relevant to such Ship as will result
 in the Security Requirement for such Ship after such prepayment (taking into
 account any other repayment of that Tranche made between the date of the
 notice and the date of such prepayment) being equal to the Security Value for
 such Ship; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 constitute to the satisfaction of the Agent such further security for
 the Loan and any amounts owing under the Master Swap Agreement as shall be
 acceptable to the Banks having a value for security purposes (as determined
 by the Agent in accordance with clause 8.2.5) at the date upon which such
 further security shall be constituted which, when added to the Security Value
 for such Ship, shall not be less than the Security Requirement for such Ship
 as at such date.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 The provisions of clause 4.4 and any relevant provisions of clause
 4.5 shall apply to prepayments under clause 8.2.1(a).

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.2.2

 	
  

 	
  

 	
 Valuation of Mortgaged Ships

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Each Mortgaged Ship shall, for the purposes of this Agreement, be
 valued in Dollars as and when the Agent (acting on the instructions of the
 Majority Banks) shall require (and at least twice per calendar year) but
 only:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 if a Charterer Event has occurred in relation to that Ship and for as
 long as that Ship has not yet become subject to, and delivered for service
 under, a Qualifying Charter; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 if a New Charterer Event has occurred in relation to that Ship and
 for as long as that Ship has not yet become subject to, and delivered for
 service under, another Qualifying Charter.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Each such valuation for a Mortgaged Ship shall be made by two (2)
 Approved Shipbrokers, each nominated by the Agent in its sole discretion.
 Each valuation shall be made without, unless required by the Agent or the
 Borrowers, physical inspection, and on the basis of a sale for prompt
 delivery for cash at arm’s length, on normal commercial terms, as between a
 willing buyer and a willing seller, without taking into account the benefit
 of any charterparty or other engagement concerning the relevant Mortgaged
 Ship. The arithmetic mean of the two valuations shall constitute the value of
 such Mortgaged Ship for the purposes of this clause 8.2 Provided
 however that if such two (2) valuations in respect of a Ship vary
 by more than ten per cent (10%) (by reference to the higher figure), the
 Agent shall appoint a third Approved Shipbroker to value such Ship on the
 same basis as the other two (2) valuations and, in that case, the arithmetic
 mean of the three (3) valuations shall constitute the value of such Mortgaged
 Ship for the purposes of this clause 8.2.

 

49

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 The value of each Mortgaged Ship determined in accordance with the
 provisions of this clause 8.2.2 shall be binding upon the parties hereto
 until such time as any further such valuation shall be obtained.

 
	
  

 	
  

 	
  

 	
  

 
	
 8.2.3

 	
  

 	
  

 	
 Information

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 The Borrowers jointly and severally undertake with the Creditors to
 supply to the Agent and to any such Approved Shipbroker such information
 concerning the relevant Mortgaged Ship and its condition as such Approved
 Shipbroker may reasonably require for the purpose of making any such
 valuation.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.2.4

 	
  

 	
  

 	
 Costs

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 All costs in connection with the Agent obtaining any of the valuations
 of each of the Mortgaged Ships referred to in clause 8.2.2, and all costs in
 connection with any valuation referred to in schedule 3, and any valuation
 either of any additional security for the purposes of ascertaining the
 Security Value in respect of any Ship at any time or necessitated by the
 Borrowers electing to constitute additional security pursuant to
 clause 8.2.1(b), shall be borne by the Borrowers. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.2.5

 	
  

 	
  

 	
 Valuation of additional security

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 For the purposes of this clause 8.2, the market value of any
 additional security (not being a ship) provided or to be provided to the
 Creditors or any of them shall be determined by the Agent in its absolute
 discretion without any necessity for the Agent assigning any reason therefor.
 If such additional security consists of a ship, the value of such ship shall
 be determined in accordance with clause 8.2.2 (except that if a ship is
 subject to a charterparty with a remaining tenor in excess of 12 months, the
 benefit or detriment of such charterparty shall be taken into account in that
 valuation). All costs of each such valuation will be paid by the Borrowers in
 accordance with clause 8.2.4. If the additional security is in the form of a
 Dollar cash deposit, full credit shall be given for such cash on a “Dollar
 for Dollar” basis. If the additional security is in the form of traded bonds,
 shares or other securities, their market value shall be their quoted trading
 price at any relevant time of calculation (and the Agent shall be entitled to
 calculate their value at any time and from time to time).

 
	
  

 	
  

 	
  

 	
  

 
	
 8.2.6

 	
  

 	
  

 	
 Documents and evidence

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 In connection with any additional security provided in accordance
 with this clause 8.2, the Agent shall be entitled to receive such
 evidence and documents of the kind referred to in schedule 3 as may in
 the Agent’s reasonable opinion be necessary and such favourable legal
 opinions as the Agent shall in its reasonable discretion require.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.2.7

 	
  

 	
  

 	
 Release of additional security

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 If, based on valuations obtained in accordance with the provisions of
 clause 8.2.2, the Security Value for a Ship shall at any time exceed the
 Security Requirement for a Ship, and the Borrowers shall have previously
 provided further security to the Banks and the other Creditors pursuant to
 clause 8.2.1(b), the Agent (acting on the instructions of the Majority Banks)
 shall, as soon as reasonably practicable after notice from the Borrowers to
 do so and subject to being indemnified for its reasonable cost of doing so,
 release or procure the release of any such further security specified by the
 Borrowers provided that the Agent is satisfied that, immediately following
 such release (a) the Security Value for each Ship to which clause 8.2.1 is
 applicable will exceed the Security Requirement for that Ship and (b) no
 Event of Default has occurred which is then continuing or will occur as a
 result of such release.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.3

 	
  

 	
 Negative undertakings

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The Borrowers jointly and severally undertake with each Creditor
 that, from the date of this Agreement and so long as any moneys are owing
 under the Security Documents and while all or any part of the Total
 Commitment or the Facility Commitment remains outstanding, they will not,
 without the prior written consent of the Agent (acting on the instructions of
 the Majority Banks):

 

50

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.3.1

 	
  

 	
  

 	
 Negative pledge

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 permit any Encumbrance (other than a Permitted Encumbrance) to
 subsist, arise or be created or extended over all or any part of their
 respective present or future undertakings, assets, rights or revenues to
 secure or prefer any present or future Indebtedness or other liability or
 obligation of any Security Party or any other person;

 
	
  

 	
  

 	
  

 	
  

 
	
 8.3.2

 	
  

 	
  

 	
 No merger

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 merge or consolidate with any other person or enter into any
 demerger, amalgamation or corporate redomiciliation of any type;

 
	
  

 	
  

 	
  

 	
  

 
	
 8.3.3

 	
  

 	
  

 	
 Disposals

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 sell, transfer, abandon, lend or otherwise dispose of or cease to
 exercise direct control over any part of their present or future undertaking,
 assets, rights or revenues (otherwise than by transfers, sales or disposals
 of assets which are not material, for full consideration in the ordinary
 course of trading but, in any event, not in respect of assets or rights which
 are subject to security created by the Security Documents), whether by one or
 a series of transactions related or not;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.3.4

 	
  

 	
  

 	
 Other business

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 undertake any type of business other than the performance of the
 Contracts and the Charters and the ownership and operation of the Ships and
 the chartering of the Ships to third parties;

 
	
  

 	
  

 	
  

 	
  

 
	
 8.3.5

 	
  

 	
  

 	
 Acquisitions

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 acquire any further assets other than the Ships and rights arising
 under contracts entered into by or on behalf of the Borrowers in the ordinary
 course of their businesses of performing the Contracts and owning, operating
 and chartering the Ships; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.3.6

 	
  

 	
  

 	
 Other obligations

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 incur any obligations except for obligations arising under the
 Underlying Documents or the Security Documents to which they are a party or
 contracts entered into in the ordinary course of their business of performing
 the Contracts and owning, operating and chartering the Ships;

 
	
  

 	
  

 	
  

 	
  

 
	
 8.3.7

 	
  

 	
  

 	
 No borrowing

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 incur any Borrowed Money except for Borrowed Money pursuant to or
 permitted by the Security Documents;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.3.8

 	
  

 	
  

 	
 Repayment of borrowings

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 repay or prepay the principal of, or pay interest on, or any other
 sum in connection with, any of their Borrowed Money except for Borrowed Money
 pursuant to the Security Documents;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.3.9

 	
  

 	
  

 	
 Guarantees

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 issue any guarantees or indemnities or otherwise become directly or
 contingently liable for the obligations of any person, firm, or corporation
 except pursuant to the Security Documents and except for (a) guarantees or
 indemnities from time to time required in the ordinary course by any
 protection and indemnity or war risks association with which a Ship is
 entered, (b) guarantees required to procure the release of a Ship from any
 arrest, detention, attachment or levy or guarantees or undertakings required
 for the salvage of a Ship and (c) other guarantees in the ordinary course of
 their business but not exceeding the amount of $500,000 per Borrower per
 calendar year;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.3.10

 	
  

 	
  

 	
 Loans

 

51

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 make any
 loans or grant any credit (save for normal trade credit in the ordinary
 course of business) to any person or agree to do so;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.3.11

 	
  

 	
  

 	
 Sureties

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 permit any of their Indebtedness to any person (other than the
 Creditors pursuant to the Security Documents) to be guaranteed by any person
 (save for (a) guarantees or indemnities from time to time required in the
 ordinary course by any protection and indemnity or war risks association with
 which a Ship is entered, (b) guarantees required to procure the release of a
 Ship from any arrest, detention, attachment or levy or guarantees or
 undertakings required for the salvage of a Ship or (c) other guarantees in
 the ordinary course of their business not exceeding the amount of $500,000
 per Borrower per calendar year);

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.3.12

 	
  

 	
  

 	
 Share
 capital and distribution

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 purchase or otherwise acquire for value any shares of their capital
 or declare or pay any dividends or distribute any of their present or future
 assets, undertakings, rights or revenues to any of their shareholders Provided always that each Borrower may
 declare or pay dividends to its shareholders if no Event of Default shall
 have occurred and be continuing at the time of, or would result from, the
 declaration or payment of such dividends;

 
	
  

 	
  

 	
  

 	
  

 
	
 8.3.13

 	
  

 	
  

 	
 Subsidiaries

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 form or
 acquire any Subsidiaries;

 
	
  

 	
  

 	
  

 	
  

 
	
 8.3.14

 	
  

 	
  

 	
 Manager

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 appoint any
 manager in respect of the Ships or any of them other than a Manager; or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 terminate or
 materially amend the terms of any Management Agreement, unless in doing so,
 they remain in compliance with clause 8.1.19;

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.3.15

 	
  

 	
  

 	
 Financial
 year and constitutional documents

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 change,
 cause, permit or agree to any change in, the way of computation of their
 financial year; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 change,
 amend or vary, or agree to or permit any change, amendment or variation of or
 to, their constitutional documents;

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.3.16

 	
  

 	
  

 	
 Intra-Group
 transactions

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 enter into any transactions, agreements or arrangements with any of
 their Related Companies or other members of the Group, other than on an arm’s
 length basis and for full value and consideration; or

 
	
  

 	
  

 	
  

 	
  

 
	
 8.3.17

 	
  

 	
  

 	
 Derivative
 transactions

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 enter into any interest rate, currency or other swap, foreign
 exchange contracts, futures or other derivative transactions, agreements or
 instruments other than Designated Transactions with the Swap Provider under
 the Master Swap Agreement and other than on terms and conditions agreed
 between the Borrowers and the Swap Provider.

 
	
  

 	
  

 	
  

 	
  

 
	
 8.4 

 	
  

 	
 Pre-delivery
positive undertakings 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The
 Borrowers hereby jointly and severally undertake and agree with each Creditor
 that they will:

 
	
  

 	
  

 	
  

 
	
 8.4.1

 	
  

 	
  

 	
 Conveyance
 on default

 

52

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 where any Ship is (or is to be) sold in exercise of any power
 contained in the relevant Pre-delivery Security Assignment or otherwise
 conferred on the Security Agent or any other Creditor, procure that the
 relevant Borrower shall execute, forthwith upon request by the Agent, such
 form of conveyance of such Ship as the Agent may require;

 
	
  

 	
  

 	
  

 	
  

 
	
 8.4.2

 	
  

 	
  

 	
 Flag State

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 not later than thirty (30) days prior to the Delivery Date of a Ship,
 obtain the Agent’s written approval of the Flag State for such Ship (if other
 than Greece, Liberia or Hong Kong); and

 
	
  

 	
  

 	
  

 	
  

 
	
 8.4.3

 	
  

 	
  

 	
 Mortgage

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 immediately upon Delivery of a Ship, execute and procure that the
 relevant Borrower shall execute, and procure the registration of, the
 Mortgage for such Ship under the laws and flag of the relevant Flag State and
 the other Security Documents in relation to such Ship and otherwise deliver
 to the Agent the documents and evidence set out in clause 9.1.4 in respect of
 such Ship.

 
	
  

 	
  

 	
  

 	
  

 
	
 8.5 

 	
  

 	
 Pre-delivery
negative undertaking 

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The Borrowers hereby jointly and severally further undertake and
 agree with each Creditor that they will not, without the prior written
 consent of the Agent (and then only subject to such conditions as the Agent
 (acting on the instructions of the Majority Banks) may impose) let or agree to
 let any Ship:

 
	
  

 	
  

 	
  

 
	
 8.5.1

 	
  

 	
  

 	
 on demise
 charter for any period; or

 
	
  

 	
  

 	
  

 	
  

 
	
 8.5.2

 	
  

 	
  

 	
 by any time or consecutive voyage charter for a term which exceeds,
 or which by virtue of any optional extensions therein contained may exceed,
 twelve (12) months’ duration (except under the relevant Charter); or

 
	
  

 	
  

 	
  

 	
  

 
	
 8.5.3

 	
  

 	
  

 	
 on terms
 whereby more than two (2) months’ hire (or the equivalent) is payable in
 advance; or

 
	
  

 	
  

 	
  

 	
  

 
	
 8.5.4

 	
  

 	
  

 	
 below the
 market rate prevailing at the time or otherwise than on an arm’s length
 basis.

 
	
  

 	
  

 	
  

 	
  

 
	
 9 

 	
  

 	
 Conditions 

 
	
  

 	
  

 	
  

 
	
 9.1 

 	
  

 	
 Documents
and evidence 

 
	
  

 	
  

 	
  

 
	
 9.1.1

 	
  

 	
  

 	
 Commitments

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 The obligation of each Bank to make its Commitment available and the
 Issuing Bank to issue any Bank Guarantee, shall be subject to the condition
 that the Agent or its duly authorised representative shall have received, not
 later than two (2) Banking Days before the date of this Agreement, the
 documents and evidence specified in Part 1 of schedule 3, in form and
 substance reasonably satisfactory to the Agent.

 
	
  

 
	
 9.1.2

 	
  

 	
  

 	
 Bank Guarantees

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 The obligation of the Issuing Bank to issue any Bank Guarantee shall
 be subject to the condition that the Agent, or its duly authorised
 representative, shall have received, on or prior to the day when such Bank
 Guarantee is issued, the documents and evidence specified in Part 2 of
 schedule 3 in respect of such Bank Guarantee in form and substance reasonably
 satisfactory to the Agent.

 
	
  

 	
  

 	
  

 	
  

 
	
 9.1.3

 	
  

 	
  

 	
 Contract
 Instalment Advances

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 The obligation of the Banks to make available a Contract Instalment
 Advance in respect of a Ship shall be subject to the condition that the Agent
 or its duly authorised representative shall have received, on or prior to the
 drawdown of the relevant Contract Instalment Advance for the relevant Ship,
 the relevant documents and evidence specified in Part 3 of schedule 3 in
 respect of the relevant Contract Instalment Advance and the relevant Ship, in
 form and substance reasonably satisfactory to the Agent.

 

53

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 9.1.4

 	
  

 	
  

 	
 Delivery
 Advances

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 The
 obligation of the Banks to make available the Delivery Advance in respect of
 a Ship shall be subject to the condition that the Agent or its duly
 authorised representative shall have received, on or prior to the drawdown of
 the Delivery Advance for such Ship, the documents and evidence specified in
 Part 4 of schedule 3 in respect of such Ship, in form and substance
 reasonably satisfactory to the Agent.

 
	
  

 	
  

 	
  

 	
  

 
	
 9.2

 	
  

 	
 General conditions precedent

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
The
 obligation of the Banks to make any Advance available and the obligation of
 the Issuing Bank to issue any Bank Guarantee shall be subject to the further
 conditions that, at the time of the giving of the Drawdown Notice for such
 Advance, and at the time of the making of such Advance or, in the case of any
 Bank Guarantee, at the time of the giving of a Bank Guarantee Request:

 
	
  

 	
  

 	
  

 
	
 9.2.1

 	
  

 	
  

 	
the
 representations and warranties contained in (a) clauses 7.1, 7.2 and
 7.3(b) of this Agreement and (b) clause 4 of the Corporate Guarantee, are
 true and correct on and as of each such time as if each was made with respect
 to the facts and circumstances existing at such time; 

 
	
  

 	
  

 	
  

 	
  

 
	
 9.2.2

 	
  

 	
  

 	
no Charterer
 Event shall have occurred in respect of the Ship to which the relevant
 Advance relates; and

 
	
  

 	
  

 	
  

 	
  

 
	
 9.2.3

 	
  

 	
  

 	
no Default
 shall have occurred and be continuing or would result from the making of the
 relevant Advance or the issuance of such Bank Guarantee.

 
	
  

 	
  

 	
  

 	
  

 
	
 9.3

 	
  

 	
 Waiver of conditions precedent

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
The
 conditions specified in this clause 9 are inserted solely for the benefit of
 the Banks and the Issuing Bank and may be waived by the Agent (acting on the
 instructions of the Majority Banks) in whole or in part and with or without
 conditions.

 
	
  

 	
  

 	
  

 
	
 10

 	
  

 	
 Events of Default

 
	
  

 	
  

 	
  

 
	
 10.1

 	
  

 	
 Events

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 There shall
 be an Event of Default if:

 
	
  

 	
  

 	
  

 
	
 10.1.1

 	
  

 	
  

 	
Non-payment: any
 Security Party fails to pay any sum payable by it under any of the Security
 Documents at the time, in the currency and in the manner stipulated in the
 Security Documents or the Underlying Documents (and so that, for this
 purpose, sums payable on demand shall be treated as having been paid at the
 stipulated time if paid within three (3) Banking Days of demand), unless any
 such failure to pay is caused by an administrative or technical error in the
 banking system, and payment of the relevant sum is made within 3 days of its
 due date; or

 
	
  

 	
  

 	
  

 	
  

 
	
 10.1.2

 	
  

 	
  

 	
Breach of Insurance and certain other
 obligations: any of the Borrowers or any other
 person fails to obtain and/or maintain the Insurances for any Mortgaged Ship
 in accordance with the requirements of the relevant Ship Security Documents
 or if any insurer in respect of such Insurances cancels such Insurances or
 disclaims liability by reason, in either case, of mis-statement in any
 proposal for such Insurances or for any other failure or default on the part
 of any of the Borrowers or any other person, or any of the Borrowers commits
 any breach of or omits to observe any of the obligations or undertakings
 expressed to be assumed by them under clauses 8.1.5 or 8.1.19 or 8.2 or 8.3
 or 8.4 or 8.5 of this Agreement, or which have been assumed by them pursuant
 to the proviso at the end of this clause 10.1, or the Corporate Guarantor
 commits any breach of or omits to observe any of the obligations or
 undertakings expressed to be assumed by it under clauses 5.1.4 or 5.1.5 or
 5.2 or 5.3 of the Corporate Guarantee; or

 
	
  

 	
  

 	
  

 	
  

 
	
 10.1.3

 	
  

 	
  

 	
Breach of other obligations:
 any Security Party or any Manager commits any breach of or omits to observe
 any of its obligations or undertakings expressed to be assumed by it under
 any of the Security Documents or a Manager’s Undertaking to which it is a
 party (other than those referred to in clauses 10.1.1 and 10.1.2 above)
 and, in respect of any such breach or omission which in the

 

54

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 opinion of
 the Agent (acting on the instructions of the Majority Banks) is capable of
 remedy, such action as the Agent (acting on the instructions of the Majority
 Banks) may require shall not have been taken within twenty (20) days of the
 Agent notifying the relevant Security Party or (as the case may be) any
 Manager of such default and of such required action; or

 
	
  

 	
  

 	
  

 	
  

 
	
 10.1.4

 	
  

 	
  

 	
Misrepresentation:
 any representation or warranty made or deemed to be made or repeated by or in
 respect of any Security Party in or pursuant to any of the Security Documents
 to which it is a party or in any notice, certificate or statement referred to
 in or delivered under any of the Security Documents to which it is a party is
 or proves to have been incorrect or misleading in any material respect; or

 
	
  

 	
  

 	
  

 	
  

 
	
 10.1.5

 	
  

 	
  

 	
Cross-default: any
 Borrowed Money of any Security Party is not paid when due or any Borrowed
 Money of any Security Party becomes (whether by declaration or automatically
 in accordance with the relevant agreement or instrument constituting the
 same) due and payable prior to the date when it would otherwise have become
 due (unless as a result of the exercise by the relevant Security Party of a
 voluntary right of prepayment), or any creditor of any Security Party becomes
 entitled to declare any such Borrowed Money due and payable and has sent a
 notice of default (or similar notice setting out the event which makes it so
 entitled), or any facility or commitment available to any Security Party
 relating to Borrowed Money is withdrawn, suspended or cancelled by reason of
 any default (however described) of the person concerned (unless the relevant
 Security Party shall have satisfied the Agent that such withdrawal,
 suspension or cancellation will not affect or prejudice in any material way
 the relevant Security Party’s ability to pay its debts as they fall due and
 fund its commitments), or any guarantee given by any Security Party in
 respect of Borrowed Money is not honoured when due and called upon Provided
 that:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
in the case
 of each Security Party (other than the Corporate Guarantor), the amount or
 aggregate amount at any one time of all Borrowed Money of that Security Party
 in relation to which any of the foregoing events shall have occurred and be
 continuing is equal to or greater than One million Dollars ($1,000,000) or
 its equivalent in the currency in which the same is denominated and payable;

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
in the case
 of the Corporate Guarantor only, the amount or aggregate amount at any one time
 of all Borrowed Money of the Corporate Guarantor in relation to which any of
 the foregoing events shall have occurred and be continuing is equal to or
 greater than Three million Dollars ($3,000,000) or its equivalent in the
 currency in which the same is denominated and payable; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
For the
 avoidance of doubt, for the purposes of this clause 10.1.5, “Borrowed
 Money” shall not include any amounts owing to the Creditors under
 this Agreement and/or any of the other Security Documents; or

 
	
  

 	
  

 	
  

 	
  

 
	
 10.1.6

 	
  

 	
  

 	
Legal process: any
 judgment or order is made against any Security Party in respect of an amount
 exceeding $1,000,000 in the case of the Corporate Guarantor or $3,000,000 in
 the case of any other Security Party, and the same is not stayed or complied
 with within fifteen (15) days; or a creditor attaches or takes possession of,
 or a distress, execution, sequestration or other process is levied or
 enforced upon or sued out against, any of the undertaking, assets, rights or
 revenues of any Security Party in respect of an amount exceeding $1,000,000
 in the case of the Corporate Guarantor or $3,000,000 in the case of any other
 Security Party, and the same is not discharged within fifteen (15) days; or

 
	
  

 	
  

 	
  

 	
  

 
	
 10.1.7

 	
  

 	
  

 	
Insolvency: any
 Security Party or the Refund Guarantor is unable or admits inability to pay
 its debts as they fall due; or suspends making payments on any of its debts
 or announces an intention to do so; or becomes insolvent; or suffers the
 declaration of a moratorium in respect of any of its Indebtedness; or any
 corporate action, legal proceedings or other procedure or step is taken in
 relation to any of the above Provided however that: 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
mere
 discussion about the mere possibility of taking any such a step in relation
 to any of the above during a board meeting, shall not constitute an Event of
 Default under this clause 10.1.7; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
a mere
 petition or legal proceedings initiated by a third party, which the Borrowers
 can demonstrate to the satisfaction of the Agent in its absolute discretion,
 by providing an opinion

 

55

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 of leading
 counsel to that effect, is frivolous, vexatious or an abuse of the process of
 the court or relates to a claim to which the relevant Security Party has a
 good defence and which is being vigorously contested by the relevant Security
 Party, shall not constitute an Event of Default under this clause 10.1.7; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.8

 	
  

 	
  

 	
Reduction or loss of capital:
 a meeting is convened by any Borrower for the purpose of passing any
 resolution to purchase, reduce or redeem any of its share capital; or

 
	
  

 	
  

 	
  

 	
  

 
	
 10.1.9

 	
  

 	
  

 	
Winding up: any
 corporate action, legal proceedings or other procedure or step is taken for
 the purpose of winding-up any Security Party or the Refund Guarantor; or an
 order is made or resolution passed for the winding up of any Security Party
 or the Refund Guarantor; or a notice is issued convening a meeting for the
 purpose of passing any such resolution unless, in the case of an involuntary
 petition, the petition is being contested in good faith and on substantial
 grounds and is dismissed or withdrawn within thirty (30) days of the
 presentation of the petition above (but mere discussion about the mere
 possibility of taking any such a step in relation to any of the above during
 a board meeting, shall not constitute an Event of Default); or

 
	
  

 	
  

 	
  

 	
  

 
	
 10.1.10

 	
  

 	
  

 	
Administration:
 any petition is presented, notice given or other step is taken for the
 purpose of the appointment of an administrator of any Security Party or the
 Refund Guarantor or an administration order is made in relation to any
 Security Party or the Refund Guarantor; or

 
	
  

 	
  

 	
  

 	
  

 
	
 10.1.11

 	
  

 	
  

 	
Appointment of receivers, managers etc.:
 any administrative or other receiver, liquidator, compulsory manager or other
 similar officer is appointed of any Security Party or the Refund Guarantor or
 any part of its assets and/or undertaking or any other steps are taken to
 enforce any Encumbrance over all or any part of the assets of any Security
 Party; or

 
	
  

 	
  

 	
  

 	
  

 
	
 10.1.12

 	
  

 	
  

 	
Compositions: any
 corporate action, legal proceedings or other procedures or steps are taken,
 or negotiations commenced, by any Security Party or by any of its creditors
 with a view to the general readjustment or rescheduling of all or part of its
 indebtedness or to proposing any kind of composition, compromise or
 arrangement involving such company and any of its creditors; or

 
	
  

 	
  

 	
  

 	
  

 
	
 10.1.13

 	
  

 	
  

 	
Analogous proceedings:
 there occurs, in relation to any Security Party or the Refund Guarantor, in
 any country or territory in which any of them carries on business or to the
 jurisdiction of whose courts any part of their assets is subject, any event
 which, in the reasonable opinion of the Agent, appears in that country or
 territory to correspond with, or have an effect equivalent or similar to, any
 of those mentioned in clauses 10.1.6 to 10.1.12 (inclusive) in respect of
 that Security Party and/or the Refund Guarantor (as the case may be) or any
 Security Party or the Refund Guarantor otherwise becomes subject, in any such
 country or territory, to the operation of any law relating to insolvency,
 bankruptcy or liquidation; or

 
	
  

 	
  

 	
  

 	
  

 
	
 10.1.14

 	
  

 	
  

 	
Cessation of business:
 any Security Party or the Refund Guarantor suspends or ceases to suspend or
 cease to carry on its business; or

 
	
  

 	
  

 	
  

 	
  

 
	
 10.1.15

 	
  

 	
  

 	
Seizure: all or a
 material part of the undertaking, assets, rights or revenues of, or shares or
 other ownership interests in, any Security Party are seized, nationalised,
 expropriated or compulsorily acquired by or under the authority of any
 government; or

 
	
  

 	
  

 	
  

 	
  

 
	
 10.1.16

 	
  

 	
  

 	
Invalidity: any of
 the Security Documents or a Refund Guarantee shall at any time and for any
 reason become invalid or unenforceable or otherwise cease to remain in full
 force and effect, or if the validity or enforceability of any of the Security
 Documents or a Refund Guarantee shall at any time and for any reason be
 contested by any Security Party or any other person which is a party thereto
 or (in the case of a Refund Guarantee) by the Refund Guarantor, or if any
 such Security Party or (as the case may be) the Refund Guarantor or such
 other person shall deny that it has any, or any further, liability
 thereunder; or

 
	
  

 	
  

 	
  

 	
  

 
	
 10.1.17

 	
  

 	
  

 	
Unlawfulness: it
 becomes impossible or unlawful at any time for any Security Party, to fulfil
 any of the covenants and obligations expressed to be assumed by it in any of
 the Security Documents or for a Creditor to exercise the rights or any of
 them vested in it under any of the Security Documents or otherwise, unless
 the Majority Banks are satisfied that through the implementation of alternative
 arrangements satisfactory to the Majority Banks, the unlawfulness or
 impossibility will be overcome

 

56

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
or rectified
 within 10 days from its occurrence but without in the meantime jeopardising
 in any way the position of the Creditors under this Agreement and the other
 Security Documents or the Encumbrances created by the Security Documents (and
 such unlawfulness or impossibility is actually overcome or rectified within
 such 10 day period); or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.18

 	
  

 	
  

 	
Repudiation: any Security Party repudiates
 any of the Security Documents or threatens, or expresses an intention, to
 repudiate any of the Security Documents; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.19

 	
  

 	
  

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

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.20

 	
  

 	
  

 	
Material adverse effect: any other event
 occurs or any other circumstances arise or develop including, without
 limitation, a material adverse change in the financial position, state of
 affairs or prospects of any Borrower or the Corporate Guarantor, in light of
 which the Majority Banks reasonably consider that there is a significant risk
 that any Borrower or the Corporate Guarantor or any other Security Party is,
 or will later become, unable to discharge its liabilities under the Security
 Documents as they fall due; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.21

 	
  

 	
  

 	
Arrest: any Ship is arrested, confiscated,
 seized, taken in execution, impounded, forfeited, detained in exercise or
 purported exercise of any possessory lien or other claim or otherwise taken
 from the possession of the relevant Borrower and the relevant Borrower shall
 fail to procure the release of such Ship within a period of ten (10) days
 thereafter; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.22

 	
  

 	
  

 	
Registration: the registration of any Ship
 under the laws and flag of the relevant Flag State is cancelled or terminated
 without the prior written consent of the Majority Banks or the registration
 of such Ship is not renewed at least thirty (30) days prior to the expiry of
 such registration; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.23

 	
  

 	
  

 	
Unrest: the Flag State of any Ship becomes
 involved in hostilities or civil war or there is a seizure of power in such
 Flag State by unconstitutional means if, in any such case:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
such event
 could in the opinion of the Agent (acting on the instructions of the Majority
 Banks) reasonably be expected to have a material adverse effect on the
 security constituted by any of the Security Documents; and 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
the Borrower
 owning such Ship has failed within thirty (30) days from receiving notice
 from the Agent (acting on the instructions of the Majority Banks) to this
 effect to: 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (i)

 	
delete the
 relevant Ship from its existing Flag State; 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (ii)

 	
register
 such Ship under another Flag State through a relevant Registry; and 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (iii)

 	
execute, at
 its own cost and expense, such other security (including a mortgage, deed of
 covenant and general assignment) in favour of the Creditors over the relevant
 Ship, its Earnings, Insurances and Requisition Compensation, as the Agent may
 in its reasonable discretion require; or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.24

 	
  

 	
  

 	
Environment: any Borrower and/or any of
 their respective Environmental Affiliates fails to comply with any
 Environmental Law or any Environmental Approval or any of the Ships is
 involved in any incident which gives rise to an Environmental Claim if, in
 any such case, such non-compliance or incident or the consequences thereof
 could, in the opinion of the Majority Banks acting through the Agent,
 reasonably be expected to have a material adverse effect on the ability of
 any Security Party to perform all or any of its obligations under or
 otherwise to comply with the terms of any of the Security Documents; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.25

 	
  

 	
  

 	
P&I: any Borrower or any other person
 fails or omits to comply with any requirements of the protection and indemnity
 association or other insurer with which a Ship is entered for insurance or
 insured against protection and indemnity risks (including oil pollution
 risks) to the effect that any cover (including, without limitation, any cover
 in respect of liability for Environmental Claims

 

57

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
arising in
 jurisdictions where such Ship operates or trades) is liable to cancellation,
 qualification or exclusion at any time; or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.26

 	
  

 	
  

 	
Shareholdings: without the prior written
 consent of the Majority Banks: 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
any of the
 Borrowers ceases at any time to be a wholly-owned direct Subsidiary of the
 Corporate Guarantor; or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
at any time
 members of the Konstantakopoulos Family cease to control any of the Managers;
 or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
any person,
 or persons acting in concert (other than any financial institution acting as
 a passive investor), at any time (i) control the Corporate Guarantor or (ii)
 become, directly or indirectly, the legal and/or beneficial and/or ultimate
 beneficial owners of a higher percentage of the total issued share capital of
 the Corporate Guarantor, than the percentage of the total issued share
 capital of the Corporate Guarantor ultimately and beneficially owned by all
 members of the Konstantakopoulos Family at that time; or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (d)

 	
at any time
 while the shares of the Corporate Guarantor are listed and trade on the New
 York Stock Exchange, members of the Konstantakopoulos Family cease (i) to
 control the Corporate Guarantor or (ii) to be the ultimate beneficial owners
 of at least forty per cent (40%) of the total issued share capital, or of the
 total issued voting share capital, of the Corporate Guarantor (either
 directly and/or through companies beneficially owned by members of the
 Konstantakopoulos Family and/or trusts or foundations controlled by the
 Konstantakopoulos Family, or of which members of the Konstantakopoulos Family
 are beneficiaries); or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (e)

 	
at any time
 after the shares of the Corporate Guarantor are de-listed or cease to trade
 on the New York Stock Exchange, members of the Konstantakopoulos Family cease
 (i) to control the Corporate Guarantor or (ii) to be the ultimate beneficial
 owners of one hundred per cent (100%) of the total issued share capital, or
 of the total issued voting share capital, of the Corporate Guarantor (either
 directly and/or through companies beneficially owned by members of the
 Konstantakopoulos Family and/or trusts or foundations controlled by the
 Konstantakopoulos Family, or of which members of the Konstantakopoulos Family
 are beneficiaries); or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.27

 	
  

 	
  

 	
Termination or variation of Assigned Contracts:
 any Assigned Contract is terminated or rescinded for any reason whatsoever
 (except with the prior written consent of the Majority Banks); or any
 Assigned Contract is frustrated; or any Assigned Contract is varied in any
 manner not permitted by or pursuant to the relevant Pre-delivery Security
 Assignment or this Agreement; or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.28

 	
  

 	
  

 	
Termination of Assigned Refund Guarantees:
 any Assigned Refund Guarantee is repudiated, cancelled, rescinded or
 otherwise terminated or expires (other than by the return of such Assigned
 Refund Guarantee by the relevant Borrower to the Seller and/or the Refund
 Guarantor following the Delivery of the relevant Ship); or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.29

 	
  

 	
  

 	
Non-Delivery of Ship or non-drawing of Delivery Advance:
 any Ship is not delivered to, and accepted by, the relevant Borrower under
 the relevant Assigned Contract or the Delivery Advance for such Ship is not
 drawn down, in either case, on or before the Final Availability Date for the
 Delivery Advance relevant to such Ship; or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.30

 	
  

 	
  

 	
Seller’s defaults: any of the events
 specified in Article X(a) of any Assigned Contract occurs in respect of
 either of the Builder or CSTC or both of them, unless the relevant Borrower
 has terminated such Assigned Contract within 30 days after the earlier of (a)
 the Borrowers or any of them becoming aware of such event and (b) the Agent
 notifying the Borrowers that such event has taken place; or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.31

 	
  

 	
  

 	
Payments under Refund Guarantees: any claim
 made under any Assigned Refund Guarantee is not paid by the Refund Guarantor,
 at the time specified by, and in accordance with, the terms of that Assigned
 Refund Guarantee after receipt by the Refund Guarantor of the relevant
 written demand thereunder; or 

 

58

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.32

 	
  

 	
  

 	
Accounts: moneys are withdrawn from any of
 the Accounts other than in accordance with clause 14; or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.33

 	
  

 	
  

 	
Demand under Bank Guarantee: the Issuing
 Bank makes a payment under any Bank Guarantee, unless on the same day when
 the Issuing Bank makes such payment, the Borrowers pay to the Issuing Bank
 such amount as is required under clause 2.7.1 as a result of such payment
 made by the Issuing Bank; or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.34

 	
  

 	
  

 	
Bank Guarantee in force: the Issuing Bank
 reasonably believes that a Bank Guarantee for a Ship has not expired and the
 Outstanding Amount in respect of such Bank Guarantee has not been reduced to
 zero (0), in each case, by the Final Availability Date for the Tranche
 relevant to such Ship; or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.1.35

 	
  

 	
  

 	
Licences, etc: any licence, authorisation,
 consent or approval at any time necessary to enable any Security Party to
 comply with its material obligations under the Security Documents or the
 Underlying Documents is revoked or withheld or modified or is otherwise not
 granted or fails to remain in full force and effect or if any exchange
 control or other law or regulation shall exist which would make any
 transaction under the Security Documents or the Underlying Documents or the
 continuation thereof, unlawful or would prevent the performance by any
 Security Party of any term of any of the Security Documents or the Underlying
 Documents, unless, in the case of unlawfulness referred to above, the
 Majority Banks are satisfied that through the implementation of alternative
 arrangements satisfactory to the Majority Banks, the unlawfulness will be
 overcome or rectified within 10 days from its occurrence but without in the
 meantime jeopardising in any way the position of the Creditors under this
 Agreement and the other Security Documents or the Encumbrances created by the
 Security Documents (and such unlawfulness is actually overcome or rectified
 within such 10 day period), 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Provided however that: 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
there shall
 not be an Event of Default if any of the events or circumstances described in
 clauses 10.1.7, 10.1.9, 10.1.10, 10.1.11, 10.1.13 and 10.1.14 takes place
 solely and exclusively with respect to the Refund Guarantor and, within
 fifteen (15) days after the earlier of (1) the date when the Borrowers or any
 of them becomes aware that the relevant event or the relevant circumstances
 have occurred or started to exist and (2) the date when the Agent notifies
 the Borrowers in writing that the relevant event or the relevant
 circumstances have occurred or exist: 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (i)

 	
the
 Borrowers have (A) arranged the issuing of new substitute refund guarantees
 for each Assigned Contract in favour of the relevant Borrower, in form and
 substance substantially similar to the Assigned Refund Guarantees and issued
 by a bank acceptable to the Agent (acting on the instructions of the Majority
 Banks in their discretion), (B) assigned in favour of the Security Agent (at
 the expense of the Borrowers) the benefit of such substitute Refund
 Guarantees by executing security assignment agreements in a form similar to
 the Pre-delivery Security Assignments (and have delivered to the Security
 Agent any notices of assignment and have used their best endeavours to
 deliver to the Security Agent acknowledgements or further documents required
 to be delivered pursuant thereto) and (C) provided the Agent (at the expense
 of the Borrowers) with any legal opinion in respect of the matters referred
 to in this paragraph (a)(i) in form and substance satisfactory to the Agent;
 or 

 

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (ii)

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
 (A)

 	
the Seller
 has returned all the Bank Guarantees to the Issuing Bank for cancellation, or
 all the Bank Guarantees have been cancelled or expired to the reasonable
 satisfaction of the Issuing Bank and the Agent (acting on the instructions of
 the Majority Banks), or the Borrowers have paid such amount to the Cash
 Collateral Account as the Agent (acting on the instructions of the Majority
 Banks) has required in its reasonable discretion (being in any event not more
 than the aggregate of (1) the then total Outstanding Amount of all the Bank
 Guarantees and (2) the total amount of all outstanding loans made (or deemed 

 

59

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
made) to the
 Borrowers pursuant to clauses 2.7.1 and 2.7.3 in connection with all Bank
 Guarantees); and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
 (B)

 	
 the
 Borrowers have prepaid the Loan in full;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
there shall
 not be an Event of Default if any of the events or circumstances described in
 clauses 10.1.27, 10.1.28, 10.1.29, 10.1.30 or 10.1.31 shall occur with
 respect to an Assigned Contract or an Assigned Refund Guarantee (as the case
 may be), and, within fifteen (15) days after the earlier of (1) the date when
 the Borrowers or any of them becomes aware that the relevant event or the
 relevant circumstances have occurred or started to exist and (2) the date
 when the Agent notifies the Borrowers in writing that the relevant event or
 the relevant circumstances have occurred or exist:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (i)

 	
 the Builders
 have returned to the Issuing Bank for cancellation the Bank Guarantee
 relevant to such Assigned Contract or Assigned Refund Guarantee or such Bank
 Guarantee has been cancelled or expired to the reasonable satisfaction of the
 Agent (acting on the instructions of the Majority Banks) or the Borrowers
 have paid such amount to the Cash Collateral Account, as the Agent (acting on
 the instructions of the Majority Banks) has required in its reasonable
 discretion (being in any event not more than the aggregate of (A) the then
 total Outstanding Amount of such Bank Guarantee and (B) the total amount of
 any outstanding loan made by the Banks to the Borrowers pursuant to clauses
 2.7.1 and 2.7.3 in connection with such Bank Guarantee); and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (ii)

 	
 the
 Borrowers have prepaid in full the Tranche for the Ship to which such
 Assigned Contract or Assigned Refund Guarantee relates;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 the
 Borrowers shall not be entitled to serve a Drawdown Notice or Bank Guarantee
 Request during the fifteen (15) day periods referred to in paragraphs (a) and
 (b) above, unless the circumstances referred to therein cease to exist and
 the Borrowers have complied with their obligations thereunder.

 
	
  

 	
  

 	
  

 
	
 10.2

 	
  

 	
 Acceleration 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The Agent
 may, and if so requested by the Majority Banks shall, without prejudice to
 any other rights of the Banks, at any time after the occurrence of an Event
 of Default and while the same is then continuing, by notice to the Borrowers:
 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.2.1

 	
  

 	
  

 	
 declare that
 the obligation of each Bank to make available its Commitment and its
 participation in the Guarantee Facility shall be terminated, whereupon the
 Total Commitment and the Facility Commitment shall be reduced to zero
 forthwith (save that, for the purposes of clauses 2.6.2 and 10.2.4 only, the
 Total Commitment shall be preserved until the Borrowers have paid to the Cash
 Collateral Account the amount specified in clause 10.2.5); and/or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.2.2

 	
  

 	
  

 	
 declare that
 the Loan and all interest and commitment commission accrued and all other
 sums payable under the Security Documents have become due and payable,
 whereupon the same shall, immediately or at any other time specified in such
 notice, become due and payable; and/or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.2.3

 	
  

 	
  

 	
 declare that
 the obligation of the Issuing Bank to issue the Bank Guarantees shall be
 terminated, whereupon the Facility Commitment shall be reduced to zero and
 such obligations of the Issuing Bank shall be terminated forthwith; and/or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.2.4

 	
  

 	
  

 	
 instruct the
 Banks to draw down any Advance or Advances and transfer the proceeds thereof
 immediately to the Cash Collateral Account (and each Borrower hereby
 irrevocably and unconditionally authorises and directs the Agent and the
 Account Bank to effect any such transfer); and/or 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.2.5

 	
  

 	
  

 	
 require the
 Borrowers to pay to the Account Bank for credit to the Cash Collateral
 Account forthwith and/or at any other time specified by the Agent, such
 amount in Dollars which, as at the date of such notice by the Agent, is in
 the Agent’s reasonable opinion equal to the aggregate of (a) the total
 Outstanding Amount of all the Bank Guarantees and (b) the total amount of any
 

 

60

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 outstanding
 loans owing by the Borrowers pursuant to clause 2.7.1 or clause 2.7.3 in
 connection with all Bank Guarantees (less the amount standing to the credit
 of the Cash Collateral Account at such date) whereupon such amounts shall
 become due and payable immediately or in accordance with any such notice (it
 being understood that the Agent shall be entitled to give multiple such
 notices for further payment of moneys by the Borrowers to the Cash Collateral
 Account, at any time and from time to time following an Event of Default and
 while the same is continuing, notwithstanding that the Borrowers may have
 complied with one or more earlier notices).

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.3 

 	
  

 	
  

 	
 Demand basis  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 If,
 pursuant to clause 10.2.2, the Agent declares the Loan to be due and payable
 on demand, the Agent may (and if so instructed by the Majority Banks shall)
 by written notice to the Borrowers call for repayment of the Loan on such
 date as may be specified whereupon the Loan shall become due and payable on
 the date so specified together with all interest and commitment commission
 accrued and all other sums payable under this Agreement.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.4 

 	
  

 	
  

 	
 Position of Swap Provider  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Neither
 the Agent nor the Security Agent shall be obliged, in connection with any action
 taken or proposed to be taken under or pursuant to the foregoing provisions
 of this clause 10, to have any regard to the requirements of the Swap
 Provider except to the extent that the Swap Provider is also a Bank.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 11 

 	
  

 	
  

 	
 Indemnities  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 11.1 

 	
  

 	
  

 	
 Miscellaneous indemnities

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 The
 Borrowers shall on demand indemnify each Creditor, without prejudice to any
 of such Creditor’s other rights under any of the Security Documents, against
 any loss (but excluding loss of Margin) or expense which such Creditor shall
 certify as sustained or incurred by it as a consequence of:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 11.1.1

 	
  

 	
  

 	
  

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

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 11.1.2

 	
  

 	
  

 	
  

 	
 the
 occurrence of any other Event of Default;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 11.1.3

 	
  

 	
  

 	
  

 	
 any
prepayment of an Advance or Tranche (or any part thereof) being made under
clauses 2.12, 4.2, 4.3, 8.2.1(a) or 12.1 or any other repayment or prepayment
of an Advance or Tranche being made otherwise than on an Interest Payment
Date relating to the part of the Advance or Tranche prepaid or repaid (but provided that any loss payable to a Bank
under this clause 11.1.3 shall not exceed the amount (if any) by which (a)
the additional interest which would have been payable to that Bank on the
amounts so prepaid had they been repaid on such Interest Payment Date,
exceeds (b) the amount of interest which, in the opinion of that Bank, would
be payable to that Bank in respect of a deposit in Dollars in an amount
similar to the amount so prepaid, if placed by that Bank with a prime bank in
London for a period starting on the day of such prepayment and ending on such
Interest Payment Date); 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 11.1.4

 	
  

 	
  

 	
  

 	
 any
 Advance not being made for any reason (excluding any default by the Agent or
 any Bank) after the Drawdown Notice for such Advance has been given; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 11.1.5

 	
  

 	
  

 	
  

 	
 the
 performance of the Issuing Bank’s obligations under any Bank Guarantee
 following a demand made thereunder,

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 including,
 in any such case, but not limited to, any loss or expense sustained or
 incurred by the relevant Creditor in maintaining or funding its Contribution
 or, as the case may be, its Commitment (or any part thereof) or in
 liquidating or re-employing deposits from third parties acquired to effect or
 maintain its Contribution or, as the case may be, its Commitment (or any part
 thereof) or in terminating or reversing or otherwise in connection with, any
 interest rate and/or currency swap or other derivative transaction or other
 arrangement entered into by a Creditor (whether with another legal entity or
 with another office or department of such Creditor) to hedge any exposure
 arising under this Agreement or in terminating,

 

61

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 reversing, or otherwise in connection with, any open position arising under
 this Agreement, or any other amount owing to such Creditor.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 11.2 

 	
  

 	
  

 	
 Currency indemnity

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 If
 any sum due from any of the Borrowers under any of the Security Documents or
 any order or judgment given or made in relation thereto has to be converted
 from the currency (the “first currency”)
 in which the same is payable under the relevant Security Document or under
 such order or judgment into another currency (the “second currency”) for the purpose of (a) making or filing a
 claim or proof against the Borrowers or any of them, (b) obtaining an order
 or judgment in any court or other tribunal or (c) enforcing any order or
 judgment given or made in relation to any of the Security Documents, the
 Borrowers shall indemnify and hold harmless each Creditor from and against
 any loss suffered as a result of any difference between (i) the rate of
 exchange used for such purpose to convert the sum in question from the first
 currency into the second currency and (ii) the rate or rates of exchange at which
 the relevant Creditor may in the ordinary course of business purchase the
 first currency with the second currency upon receipt of a sum paid to it in
 satisfaction, in whole or in part, of any such order, judgment, claim or
 proof. Any amount due from the Borrowers under this clause 11.2 shall be due
 as a separate debt and shall not be affected by judgment being obtained for
 any other sums due under or in respect of any of the Security Documents and
 the term “rate of exchange”
 includes any premium and costs of exchange payable in connection with the
 purchase of the first currency with the second currency.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 11.3 

 	
  

 	
  

 	
 Environmental indemnity

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 The
 Borrowers shall indemnify each Creditor on demand and hold it harmless from
 and against all costs, expenses, payments, charges, losses, demands,
 liabilities, actions, proceedings (whether civil or criminal), penalties,
 fines, damages, judgements, orders, sanctions or other outgoings of whatever
 nature (including, without limitation, those arising under Environmental
 Laws) which may be suffered, incurred or paid by, or made or asserted against
 such Creditor at any time, whether before or after the repayment in full of
 all amounts of principal and interest under this Agreement, relating to, or
 arising directly or indirectly in any manner or for any cause or reason
 whatsoever out of an Environmental Claim made or asserted against such
 Creditor if such Environmental Claim would or could not have been, or been
 capable of being, made or asserted against such Creditor if it had not
 entered into any of the Security Documents and/or exercised any of its
 rights, powers and discretions thereby conferred and/or performed any of its
 obligations thereunder and/or been involved in any of the transactions
 contemplated by the Security Documents.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 11.4 

 	
  

 	
  

 	
 Waiver

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 In
 no event shall a Creditor or any of its Related Companies or any of their
 respective officers or directors be liable on any theory of liability for any
 special, indirect, consequential or punitive damages and each Borrower hereby
 waives, releases and agrees not to sue upon any such claim for any such
 damages, whether or not accrued and whether or not known or suspected to
 exist in its favour.

 

62

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 11.5 

 	
  

 	
  

 	
 General indemnity

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 The
 Borrowers jointly and severally hereby indemnify and agree to hold harmless
 the Creditors and each of their respective Related Companies and each of
 their respective officers, directors, employees, agents, advisors and
 representatives (each, an “Indemnified Party”)
 from and against any and all claims, damages, losses, liabilities, costs,
 legal and other expenses (altogether the “Losses”),
 joint or several, that may be incurred by or asserted or awarded against any
 Indemnified Party, in each case arising out of or in connection with or
 relating to any claim, investigation, litigation or proceeding (or the
 preparation of any defence with respect thereto) commenced or threatened in
 relation to the Security Documents or any of them (or the transactions
 contemplated hereby or thereby) or any use made or proposed to be made with
 the proceeds of the Loan. This indemnity shall apply whether or not such
 claims, investigation, litigation or proceeding is brought by the Borrowers
 or any of them, any other Security Party, any other member of the Group, any
 of their respective shareholders or creditors, an Indemnified Party or any
 other person, or an Indemnified Party is otherwise a party thereto, except to
 the extent that such Losses are found in a final, non-appealable judgment by
 a court of competent jurisdiction to have resulted from such Indemnified
 Party’s gross negligence or wilful misconduct.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 12 

 	
  

 	
  

 	
 Unlawfulness, increased costs
 and mitigation

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 12.1 

 	
  

 	
  

 	
 Unlawfulness

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 12.1.1

 	
  

 	
  

 	
  

 	
 Loan

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 If
 it is or becomes contrary to any law or regulation for any Bank to contribute
 to an Advance or to maintain its Commitment or fund the Loan or perform any
 of its other obligations under this Agreement, such Bank shall promptly,
 through the Agent, give notice to the Borrowers whereupon:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (a)

 	
 such
 Bank’s Commitment shall be reduced to zero (save that, for the purposes of
 clauses 2.6.2 and 10.2.4 only, such Bank’s Commitment shall be preserved
 until the Borrowers have paid to the Cash Collateral Account the amount
 required of them under paragraph (b)(ii) below); and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 (b)

 	
 the
 Borrowers shall be obliged to (i) prepay such Bank’s Contribution and (ii) if
 any Bank Guarantee is outstanding and such Bank is also a Guarantee Bank, pay
 to the Account Bank for credit to the Cash Collateral Account an amount equal
 to the Outstanding Amount of each such Bank Guarantee, in each case either
 (A) forthwith or (B) on a future specified date not being later than the
 latest date permitted by the relevant law or regulation together with
 interest and commissions accrued to the date of prepayment and all other sums
 payable by the Borrowers under this Agreement and/or the Master Swap
 Agreement.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 12.1.2

 	
  

 	
  

 	
  

 	
 Bank
 Guarantees

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 If
 it is or becomes contrary to any law or regulation for the Issuing Bank to
 issue any Bank Guarantee, the Issuing Bank shall promptly give notice to the
 Borrowers and the Agent whereupon the obligation of the Issuing Bank to give
 any such confirmation shall be terminated.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 12.2 

 	
  

 	
  

 	
 Increased costs

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 If
 the result of any change in, or in the interpretation or application of, or
 the introduction of, any Capital Adequacy Law or of compliance by a Bank with
 any Capital Adequacy Law, is to:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 12.2.1

 	
  

 	
  

 	
  

 	
 subject
 any Bank or the Issuing Bank to Taxes or change the basis of Taxation of any
 Bank or the Issuing Bank with respect to any payment under any of the
 Security Documents (other than Taxes or Taxation on the overall net income,
 profits or gains of such Bank or the Issuing Bank imposed in the jurisdiction
 in which its principal or lending office under this Agreement is located);
 and/or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 12.2.2

 	
  

 	
  

 	
  

 	
 increase
 the cost to, or impose an additional cost on (a) any Bank or its holding
 company in making or keeping such Bank’s Commitment available or maintaining
 or funding all or part of such Bank’s Contribution or any amounts owing under
 clause 2.7.3 or (b) the Issuing Bank or its holding company in making or
 keeping available its obligation to issue any Bank Guarantee or to maintain
 or fund all or part of any amounts owing under clause 2.7.1; and/or; and/or

 

63

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 12.2.3

 	
  

 	
  

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

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 12.2.4

 	
  

 	
  

 	
 reduce
 any Bank’s or the Issuing Bank’s or their respective holding company’s rate
 of return on its overall capital by reason of a change in the manner in which
 it is required to allocate capital resources to such Bank’s or the Issuing
 Bank’s obligations under any of the Security Documents; and/or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 12.2.5

 	
  

 	
  

 	
 require
 any Bank or the Issuing Bank or their respective holding company to make a
 payment or forego a return on or calculated by reference to any amount
 received or receivable by such Bank or the Issuing Bank under any of the
 Security Documents; and/or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 12.2.6

 	
  

 	
  

 	
 require
 any Bank or the Issuing Bank or their respective holding company to incur or
 sustain a loss by reason of being obliged to deduct all or part of its
 Commitment or the Loan or any amount owing under clause 2.7.3 or, in the case
 of the Issuing Bank, all or part of the amount that will be guaranteed by a
 Bank Guarantee or the Outstanding Amount or any amount owing under clause
 2.7.1, from its capital for regulatory purposes,

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 then
 and in each such case (subject to clause 12.3):

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 such
 Bank or, as the case may be, the Issuing Bank shall (through the Agent)
 notify the Borrowers in writing of such event promptly upon its becoming
 aware of the same; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 the
 Borrowers shall on demand pay to the Agent for the account of such Bank or,
 as the case may be, the Issuing Bank, at any time after the expiry of the
 Negotiation Period (and whether or not the Loan or any part thereof has then
 been repaid or prepaid and whether or not any Bank Guarantee has been reduced
 to zero or expired), pay to such Bank or, as the case may be, the Issuing
 Bank the amount which such Bank or, as the case may be, the Issuing Bank
 specifies (in a certificate (which shall be conclusive on the Borrowers in
 the absence of manifest error) setting forth the basis of the computation of
 such amount but not including any matters which such Bank or, as the case may
 be, the Issuing Bank or their respective holding company regards as confidential)
 is required to compensate such Bank or, as the case may be, the Issuing Bank
 (or their respective holding company) for such liability to Taxes,
 alternative funding, increased cost, reduction, payment, loss or foregone
 return (as the case may be).

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 For
 the purposes of this clause 12.2 and clause 12.4, “holding company” means the company or entity (if any) within
 the consolidated supervision of which a Bank or, as the case may be, the
 Issuing Bank is included.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 12.3 

 	
  

 	
 Exception

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Nothing
 in clause 12.2 shall entitle any Bank or the Issuing Bank to receive any
 amount in respect of compensation for any such liability to Taxes, increased
 or additional cost, reduction, payment, foregone return or loss to the extent
 that the same is the subject of an additional payment under clause 6.6.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 12.4 

 	
  

 	
 Mitigation and Tax credits

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 12.4.1

 	
  

 	
  

 	
 Mitigation

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 If
 circumstances arise which would, or would upon the giving of notice, result
 in an increased payment required to be made by the Borrowers under clause 6.6
 or clause 12.2 then, without in any way limiting the obligations of the
 Borrowers under either of these clauses, the relevant Bank shall use
 reasonable endeavours to transfer its obligations, liabilities and rights
 under this Agreement and the other Security Documents to another of its
 offices not affected by the circumstances which gave rise to such increased
 payment, but no Bank shall be under any obligation to take any such action,
 and, in any event, it shall not do so if in its opinion, to do so would or
 might:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 be
 prejudicial to such Bank (or, as the case may be, its holding company); or

 

64

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 have an adverse effect on such Bank’s or its holding company’s
 business, operations, administration or financial condition; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (c)

 	
 involve
 such Bank or its holding company in any activity which is unlawful or
 prohibited or any activity that is contrary to, or inconsistent, with any
 regulation or such Bank’s general banking policies; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (d)

 	
 involve
 such Bank or its holding company in any expense (unless indemnified to its
 satisfaction) or tax disadvantage.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 12.4.2

 	
  

 	
 Tax
 credits

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 If
 a Bank receives for its own account a repayment or credit in respect of tax
 on account for which the Borrowers have made an increased payment under
 clause 6.6, it shall pay to the Borrowers a sum equal to the repayment or
 credit received, provided always that:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (a)

 	
 such
 Bank can do so without prejudicing the retention of the amount of such
 repayment or credit and without prejudice to the right of such Bank to obtain
 any other relief or allowance which may be available to it;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 such
 Bank shall not be obliged to allocate to this transaction any part of a tax
 repayment or credit which is referable to a number of transactions if the
 Loan does not fall within such number of transactions;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (c)

 	
 nothing
 in this clause shall entitle the Borrowers to enquire about such Bank’s tax
 affairs or oblige such Bank to arrange its tax affairs in any particular
 manner, to disclose any information regarding its tax affairs and
 computations, to claim any type of relief, credit, allowance or deduction
 instead of, or in priority to, another or to make any such claim within any
 particular time;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (d)

 	
 nothing
 in this clause shall oblige such Bank to make a payment which exceeds any
 repayment or credit in respect of tax on account of which the Borrowers have
 made an increased payment under clause 6.6; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (e)

 	
 any
 allocation or determination made by such Bank under or in connection with
 this clause shall be prima facie evidence of the payment due to the Borrowers
 under this clause 12.4.2.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13

 	
  

 	
 Security, set-off and pro-rata
 payments

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.1

 	
  

 	
 Application of moneys

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 All
 moneys received by the Agent and/or the Security Agent under or pursuant to
 any of the Security Documents and expressed to be applicable in accordance
 with the provisions of this clause 13.1 or in a manner determined in the
 Security Agent’s or (as the case may be) the Agent’s discretion, shall be
 applied in the following manner:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.1.1

 	
  

 	
  

 	
 first,
 in or towards payment, on a pro rata basis, of all unpaid costs and expenses
 which may be owing to any Arranger, the Agent and/or the Security Agent
 and/or the Issuing Bank and/or the Swap Provider or any of them under any of
 the Security Documents;

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.1.2

 	
  

 	
  

 	
 secondly,
 in or towards payment, on a pro rata basis, of any unpaid fees and
 commissions payable to the Creditors (other than the Swap Provider) or any of
 them;

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.1.3

 	
  

 	
  

 	
 thirdly,
 in or towards payment, on a pro rata basis, of any arrears of interest owing
 in respect of the Loan or in respect of any amounts owing under clauses 2.7.1
 and 2.7.3 or any part thereof;

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.1.4

 	
  

 	
  

 	
 fourthly,
 in or towards repayment, on a pro rata basis, of the Loan or any amount of
 principal owing under clauses 2.7.1 or 2.7.3 (whether the same is due and
 payable or not);

 

65

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.1.5

 	
  

 	
  

 	
 fifthly,
 in or towards payment to the Cash Collateral Account of any amounts so
 payable pursuant to the terms of this Agreement or the other Security
 Documents;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.1.6

 	
  

 	
  

 	
 sixthly,
 in or towards payment, on a pro rata basis, to any Bank for any loss suffered
 by reason of any such payment in respect of principal not being effected on
 an Interest Payment Date relating to the part of the Loan repaid and which
 amounts are so payable under this Agreement;

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.1.7

 	
  

 	
  

 	
 seventhly,
 in or towards payment to any Creditor (other than the Swap Provider) of any
 other sums owing to it under any of the Security Documents (and if such sums
 are owing to more than one Creditor, as between such Creditors on a pro rata
 basis); and

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.1.8

 	
  

 	
  

 	
 eighthly,
 in or towards payment to the Swap Provider of any sums owing to it under the
 Master Swap Agreement;

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.1.9

 	
  

 	
  

 	
 ninethly,
 the surplus (if any) shall be paid to the Borrowers or to whomsoever else may
 be entitled to receive such surplus.

 
	
  

 
	
 13.2

 	
  

 	
 Set-off

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.2.1

 	
  

 	
  

 	
 The
 Borrowers authorise each Creditor (without prejudice to any of such
 Creditor’s rights at law, in equity or otherwise), at any time following the
 occurrence of an Event of Default and while the same is continuing and with
 notice to the Borrowers, to apply any credit balance to which the Borrowers
 or any of them is then entitled standing upon any account of the Borrowers or
 any of them with any branch of such Creditor in or towards satisfaction of
 any sum due and payable from the Borrowers or any of them to such Creditor
 under any of the Security Documents. For this purpose, each Creditor is
 authorised to purchase with the moneys standing to the credit of such account
 such other currencies as may be necessary to effect such application.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.2.2

 	
  

 	
  

 	
 No
 Creditor shall be obliged to exercise any right given to it by this clause
 13.2. Each Creditor shall notify the Borrowers through the Agent forthwith
 upon the exercise or purported exercise of any right of set-off giving full
 details in relation thereto and the Agent shall inform the other Creditors.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.2.3

 	
  

 	
  

 	
 Nothing
 in this clause 13.2 shall be effective to create an Encumbrance or any other
 security interest.

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.3

 	
  

 	
 Pro rata payments

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.3.1

 	
  

 	
  

 	
 If
 at any time any Bank (including in its capacity as Guarantee Bank) (the “Recovering Bank”) receives or recovers
 any amount owing to it by the Borrowers under this Agreement by direct
 payment, set-off or in any manner other than by payment through the Agent
 pursuant to clauses 6.1 or 6.9 (not being a payment received from a
 Transferee Bank or a sub-participant in such Bank’s Contribution or any other
 payment of an amount due to the Recovering Bank for its sole account pursuant
 to clauses 3.6, 5, 6.6, 11.1, 11.2, 12.1, or 12.2), the Recovering Bank
 shall, within two (2) Banking Days of such receipt or recovery (a “Relevant Receipt”) notify the Agent of
 the amount of the Relevant Receipt. If the Relevant Receipt exceeds the
 amount which the Recovering Bank would have received if the Relevant Receipt
 had been received by the Agent and distributed pursuant to clause 6.1 or 6.9
 (as the case may be) then:

 
	
  

 
	
  

 	
  

 	
 (a)

 	
 within
 two (2) Banking Days of demand by the Agent, the Recovering Bank shall pay to
 the Agent an amount equal (or equivalent) to the excess;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 the
 Agent shall treat the excess amount so paid by the Recovering Bank as if it
 were a payment made by the Borrowers and shall distribute the same to the
 Banks (other than the Recovering Bank) in accordance with clause 6.9; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (c)

 	
 as
 between the Borrowers and the Recovering Bank the excess amount so
 re-distributed shall be treated as not having been paid but the obligations
 of the Borrowers to the other Banks shall, to the extent of the amount so
 re-distributed to them, be treated as discharged.

 

66

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.3.2

 	
  

 	
  

 	
 If
 any part of the Relevant Receipt subsequently has to be wholly or partly
 refunded by the Recovering Bank (whether to a liquidator or otherwise) each
 Bank to which any part of such Relevant Receipt was so re-distributed shall
 on request from the Recovering Bank repay to the Recovering Bank such Bank’s
 pro-rata share of the amount which has to be refunded by the Recovering Bank.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.3.3

 	
  

 	
  

 	
 Each
 Bank shall on request supply to the Agent such information as the Agent may
 from time to time request for the purposes of this clause 13.3.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.3.4

 	
  

 	
  

 	
 Notwithstanding
 the foregoing provisions of this clause 13.3, no Recovering Bank shall be
 obliged to share any Relevant Receipt which it receives or recovers pursuant
 to legal proceedings taken by it to recover any sums owing to it under this
 Agreement with any other party which has a legal right to, but does not,
 either join in such proceedings or commence and diligently pursue separate
 proceedings to enforce its rights in the same or another court (unless the
 proceedings instituted by the Recovering Bank are instituted by it without
 prior notice having been given to such party through the Agent).

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.4

 	
  

 	
 No release 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 For
 the avoidance of doubt it is hereby declared that failure by any Recovering
 Bank to comply with the provisions of clause 13.3 shall not release any other
 Recovering Bank from any of its obligations or liabilities under clause 13.3.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.5

 	
  

 	
 No charge 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The
 provisions of this clause 13 shall not, and shall not be construed so as to,
 constitute a charge by a Bank over all or any part of a sum received or
 recovered by it in the circumstances mentioned in clause 13.3.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.6

 	
  

 	
 Further assurance 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

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

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.7

 	
  

 	
 Conflicts 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 In
 the event of any conflict between this Agreement and any of the other
 Borrowers’ Security Documents (other than the Master Swap Agreement), the
 provisions of this Agreement shall prevail.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 14

 	
  

 	
 Accounts 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 14.1

 	
  

 	
 General 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The
 Borrowers jointly and severally undertake with each Creditor that they will:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 14.1.1

 	
  

 	
  

 	
 on
 or before the first Bank Guarantee Issue Date, open the Accounts; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 14.1.2

 	
  

 	
  

 	
 procure
 that all moneys payable to each Borrower in respect of the Earnings of such
 Borrower’s Ship shall, unless and until the Agent (acting on the instructions
 of the Majority Banks) directs to the contrary pursuant to the provisions of
 the relevant Ship Security Documents, be paid to the relevant Operating
 Account, Provided however that if any of the moneys paid to any of the
 Accounts are payable in a currency other than Dollars, the Account Bank shall
 (and the Borrowers hereby irrevocably and unconditionally instruct the
 Account Bank to) convert such moneys into Dollars at the Account Bank’s spot
 rate of exchange at the relevant time for the purchase of Dollars with such
 currency and the term

 

67

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 “spot rate of exchange” shall include any
 premium and costs of exchange payable in connection with the purchase of
 Dollars with such currency.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 14.2

 	
  

 	
 Operating Accounts: withdrawals 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Moneys
 payable to each Operating Account in respect of Earnings of the relevant Ship
 shall be at the free disposal of each Borrower and each Borrower may withdraw
 moneys from its Operating Account. However, if an Event of Default occurs and
 while the same is continuing, no Borrower shall be entitled to withdraw any
 moneys from its Operating Account for so long as any moneys are owing under
 the Security Documents.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 14.3

 	
  

 	
 Cash Collateral Account: withdrawals 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Unless
 the Agent (acting on the instructions of the Majority Banks) otherwise agrees
 in writing, the Borrowers shall not be entitled to withdraw any moneys from
 the Cash Collateral Account at any time from the date of this Agreement and
 so long as the Borrowers remain under any obligation, actual or contingent,
 under this Agreement or any moneys are owing under the Security Documents.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 14.4

 	
  

 	
 Application of Accounts 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 14.4.1

 	
  

 	
  

 	
 At
 any time after the occurrence of an Event of Default and while the same is
 continuing, the Agent may (and on the instructions of the Majority Banks
 shall), with notice to the Borrowers, instruct the Account Bank to apply all
 moneys then standing to the credit of an Account, together with interest from
 time to time accruing or accrued thereon in the manner specified in clause
 13.1.

 
	
  

 
	
 14.4.2

 	
  

 	
  

 	
 The
 Agent (acting on the instructions of the Majority Banks) shall instruct the
 Account Bank to pay to the Issuing Bank or the Guarantee Banks and debit the
 Cash Collateral Account, on or after the date on which the Issuing Bank makes
 any payment under a Bank Guarantee, an amount equal to the amount of such
 payment (or the amount standing to the credit of the Cash Collateral Account,
 if less) and the Issuing Bank or (as the case may be) the Guarantee Banks
 shall apply such moneys forthwith upon receipt in or towards disclosure of
 the Borrowers’ obligations under clause 2.7.1 or clause 2.7.3 (as the case
 may be) or, in the Majority Banks’ absolute discretion, in direct payment to
 CSTC of any amount demanded by it under one or more Bank Guarantees.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 14.4.3

 	
  

 	
  

 	
 At
 any time after the occurrence of an Event of Default and while the same is
 continuing, the Agent may (and on the instructions of the Majority Banks and
 the Issuing Bank shall), with notice to the Borrowers, instruct the Account
 Bank to apply all moneys then standing to the credit of an Account, together
 with interest from time to time accruing or accrued thereon:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (a)

 	
 first,
 in or towards satisfaction of any sums due to the Issuing Bank under the
 Security Documents; and 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 secondly,
 after the Bank Guarantee Expiry Date of all Bank Guarantees and provided that
 no moneys are owing to the Issuing Bank under this Agreement and the other
 Security Documents, in or towards satisfaction of any sums due to the
 Creditors or any of them under the Security Documents in the manner specified
 in clause 13.1. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 14.4.4

 	
  

 	
 Neither
 the Agent nor the Banks shall be obliged to exercise their rights under
 clauses 14.4.1, 14.4.2 or 14.4.3 in relation to the Cash Collateral Account,
 and any moneys standing to the credit of the Cash Collateral Account from
 time to time shall constitute continuing security for the payment of all
 moneys and obligations, actual or contingent, of the Borrowers under this
 Agreement. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 14.4.5

 	
  

 	
 Any
 moneys standing to the credit of the Cash Collateral Account in respect of a
 Bank Guarantee, shall be released to the Borrowers (or to their order), if: 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (a)

 	
 no
 Event of Default has occurred and is continuing at the time of release to the
 Borrowers (or to their order); and 

 

68

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 that Bank Guarantee has been cancelled, released or discharged, it
 has been returned to the Issuing Bank and the Outstanding Amount in respect
 of that Bank Guarantee has been reduced to zero (0); and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 no
 payments have been made by the Issuing Bank under such Bank Guarantee.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 14.5

 	
  

 	
 Account terms

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Amounts
 standing to the credit of each Account shall (unless otherwise agreed between
 the Account Bank and the Borrowers) bear interest at the rates from time to
 time offered by the Account Bank to its customers for Dollar deposits in
 comparable amounts for comparable periods. Interest shall accrue on each
 Account from day to day and be calculated on the basis of actual days elapsed
 and a three hundred and sixty (360) day year and shall be credited to the
 relevant Account at such times as the Account Bank and the Borrowers shall
 agree.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 14.6

 	
  

 	
 Pledging of Accounts

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The
 Accounts and all amounts from time to time standing to the credit thereof
 shall be subject to the security constituted and the rights conferred by the
 Account Assignments.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 15

 	
  

 	
 Assignment, transfer and
 lending office 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 15.1

 	
  

 	
 Benefit and burden 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 This
 Agreement shall be binding upon, and enure for the benefit of, the Creditors
 and the Borrowers and their respective successors in title.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 15.2

 	
  

 	
 No assignment by Borrowers

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 No
 Borrower may assign or transfer any of its rights or obligations under this
 Agreement.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 15.3

 	
  

 	
 Transfers by Banks

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Subject
 to the prior written consent of (a) the Borrowers (which consent shall not be
 unreasonably withheld and the request for which shall be promptly responded
 to) and (b) each Arranger in its absolute discretion, any Bank (the “Transferor Bank”) may at any time, cause
 all or any part of its rights, benefits and/or obligations under this
 Agreement and the Security Documents to be transferred to any other bank or
 financial institution or other person whatsoever (a “Transferee Bank”) by delivering to the
 Agent a Transfer Certificate duly completed and duly executed by the
 Transferor Bank and the Transferee Bank. No such transfer is binding on, or
 effective in relation to, the Borrowers or the Agent or the other Creditors
 unless (i) it is effected or evidenced by a Transfer Certificate which
 complies with the provisions of this clause 15.3 and is signed by or on
 behalf of the Transferor Bank, the Transferee Bank and the Agent (on behalf
 of itself, the Borrowers and the other Creditors) and (ii) such transfer of
 rights under the other Security Documents has been effected and registered to
 the satisfaction of the Agent. The Borrowers’ consent referred to above shall
 not be required in respect of a transfer if (1) the relevant Transferee Bank
 is a Related Company of the Transferor Bank or (2) an Event of Default has
 occurred which is continuing at the time of the relevant transfer. Upon
 signature of any such Transfer Certificate by the Agent, which signature
 shall be effected as promptly as is practicable after such Transfer
 Certificate has been delivered to the Agent, and subject to the terms of such
 Transfer Certificate, such Transfer Certificate shall have effect as set out
 below.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The
 following further provisions shall have effect in relation to any Transfer
 Certificate:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 15.3.1

 	
  

 	
  

 	
 a
 Transfer Certificate may be in respect of a Bank’s rights in respect of all,
 or part of, its Commitment and shall be in respect of the same proportion of
 its Contribution and, if also a Guarantee Bank, the same proportion of its
 participation in the Guarantee Facility;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 15.3.2

 	
  

 	
  

 	
 a
 Transfer Certificate shall only be in respect of rights and obligations of
 the Transferor Bank in its capacity as a Bank (including as a Guarantee Bank)
 and shall not transfer its rights and obligations

 

69

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 as
 the Agent, or in any other capacity, as the case may be and such other rights
 and obligations may only be transferred in accordance with any applicable
 provisions of this Agreement;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 15.3.3

 	
  

 	
  

 	
 a
 Transfer Certificate shall take effect in accordance with English law as
 follows: 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 to
 the extent specified in the Transfer Certificate, the Transferor Bank’s
 payment rights and all its other rights (other than those referred to in
 clause 15.3.2 above) under this Agreement are assigned to the Transferee Bank
 absolutely, free of any defects in the Transferor Bank’s title and of any
 rights or equities which the Borrowers had against the Transferor Bank;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 the
 Transferor Bank’s obligations are discharged to the extent specified in the
 Transfer Certificate;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 the
 Transferee Bank becomes a Bank with a Contribution, Commitment and Percentage
 of the amounts specified in the Transfer Certificate;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (d)

 	
 the
 Transferee Bank becomes bound by all the provisions of this Agreement and the
 Security Documents which are applicable to the Banks generally, including
 those about pro-rata sharing and the exclusion of liability on the part of,
 and the indemnification of, the Arrangers, the Agent and the Security Agent
 and to the extent that the Transferee Bank becomes bound by those provisions,
 the Transferor Bank ceases to be bound by them;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (e)

 	
 an
 Advance or part of an Advance which the Transferee Bank makes after the
 Transfer Certificate comes into effect ranks in point of priority and
 security in the same way as it would have ranked had it been made by the
 Transferor Bank, assuming that any defects in the Transferor Bank’s title and
 any rights or equities of any Security Party against the Transferor Bank had
 not existed; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (f)

 	
 the
 Transferee Bank becomes entitled to all the rights under this Agreement which
 are applicable to the Banks generally, including but not limited to those
 relating to the Majority Banks and those under clauses 3.6, 5 and 11.3 and to
 the extent that the Transferee Bank becomes entitled to such rights, the
 Transferor Bank ceases to be entitled to them;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 15.3.4

 	
  

 	
  

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

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 15.3.5

 	
  

 	
  

 	
 the
 Borrowers, the Account Bank, the Security Agent, the Issuing Bank, the
 Arrangers, the Swap Provider and the Banks hereby irrevocably authorise and
 instruct the Agent to sign any such Transfer Certificate on their behalf and
 undertake not to withdraw, revoke or qualify such authority or instruction at
 any time. Promptly upon its signature of any Transfer Certificate, the Agent
 shall notify the Borrowers, the other Banks, the Transferor Bank and the
 Transferee Bank. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 15.4

 	
  

 	
 Reliance on Transfer Certificate 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 15.4.1

 	
  

 	
  

 	
 The
 Agent shall be entitled to rely on any Transfer Certificate believed by it to
 be genuine and correct and to have been presented or signed by the persons by
 whom it purports to have been presented or signed, and shall not be liable to
 any of the parties to this Agreement and the Security Documents for the
 consequences of such reliance. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 15.4.2

 	
  

 	
  

 	
 The
 Agent shall at all times during the continuation of this Agreement maintain a
 register in which it shall record the name, Commitments, Contributions,
 Percentages and administrative details (including the lending office) from
 time to time of the Banks holding a Transfer Certificate and the date at
 which the transfer referred to in such Transfer Certificate held by each Bank
 was transferred to such Bank, and the Agent shall make the said register
 available for inspection by any Bank, the Issuing Bank or any Borrower during
 normal banking hours upon receipt by the Agent of reasonable prior notice
 requesting the Agent to do so. 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 15.4.3

 	
  

 	
  

 	
 The
 entries on the said register shall, in the absence of manifest error, be
 conclusive in determining the identities of the Commitments, Contributions,
 Percentages and the Transfer Certificates held by the Banks from time to time
 and the principal amounts of such Transfer Certificates and may be 

 

70

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 relied upon
 by the Agent and the other Security Parties for all purposes in connection
 with this Agreement and the Security Documents. 

 
	
  

 	
  

 	
  

 
	
 15.5

 	
  

 	
 Transfer fees and expenses 

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 If any Bank
 causes the transfer of all or any part of its rights, benefits and/or
 obligations under the Security Documents, the Transferor Bank shall pay to
 the Agent on demand all costs, fees and expenses (including, but not limited
 to, legal fees and expenses), and all value added tax thereon, verified by
 the Agent as having been incurred by it and any other Bank in connection with
 such transfer. 

 
	
  

 	
  

 	
  

 
	
 15.6

 	
  

 	
 Documenting transfers 

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 If any Bank
 assigns all or any part of its rights or transfers all or any part of its
 rights, benefits and/or obligations as provided in clause 15.3, the Borrowers
 jointly and severally undertake with each Creditor, immediately on being
 requested to do so by the Agent and at the cost of the Transferor Bank, to
 enter into, and procure that the other Security Parties shall (at the cost of
 the Transferor Bank) enter into, such documents as may be necessary or
 desirable to transfer to the Transferee Bank all or the relevant part of such
 Bank’s interest in the Security Documents and all relevant references in this
 Agreement to such Bank shall thereafter be construed as a reference to the
 Transferor Bank and/or its Transferee Bank (as the case may be) to the extent
 of their respective interests. Any costs, fees and expenses incurred in
 relation to any such transfer will not in any case create any liability
 whatsoever on the part of the Borrowers for payment of the same whether under
 the Security Documents or otherwise. 

 
	
  

 	
  

 	
  

 
	
 15.7

 	
  

 	
 Sub-participation

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 A Bank may
 sub-participate to any other bank or financial institution all or any part of
 its rights and/or obligations under the Security Documents without the
 consent of, or notice to, the Borrowers. 

 
	
  

 
	
 15.8

 	
  

 	
 Lending office

 
	
  

 
	
  

 	
  

 	
 Each Bank
 shall lend through its office at the address specified in schedule 1 or, as
 the case may be, in any relevant Transfer Certificate, or through any other
 office of such Bank selected from time to time by it through which such Bank
 wishes to lend for the purposes of this Agreement Provided that a Bank shall not change its lending office if
 immediately after, and as a result of, such change the Borrowers would be
 responsible to pay additional amounts under clause 6.6 or clause 12.1
 compared to the amounts payable by the Borrowers under such clauses
 immediately before such change of lending office. If the office through which
 a Bank is lending is changed pursuant to this clause 15.8, such Bank shall
 notify the Agent promptly of such change and the Agent shall notify the
 Borrowers, the Security Agent, the Account Bank, the Swap Provider, the
 Issuing Bank and the other Banks. 

 
	
  

 
	
 15.9

 	
  

 	
 Disclosure of information by Banks

 
	
  

 
	
  

 	
  

 	
 A Bank may,
 with the prior consent of the Agent in its discretion, disclose to a
 prospective assignee, transferee or to any other person who may propose
 entering into contractual relations with such Bank in relation to this
 Agreement such information about the Borrowers and/or the other Security
 Parties as such Bank shall consider appropriate Provided that the relevant
 Bank has entered into a confidentiality agreement with such person in
 connection with any such information. 

 
	
  

 
	
 16

 	
  

 	
 Arrangers, Agent and Security Agent 

 
	
  

 
	
 16.1

 	
  

 	
 Appointment of the Agent 

 
	
  

 
	
  

 	
  

 	
 Each Bank,
 the Issuing Bank and the Swap Provider irrevocably appoints the Agent as its
 agent for the purposes of this Agreement and such of the Security Documents
 to which it may be appropriate for the Agent to be party. By virtue of such
 appointment, each of the Banks, the Issuing Bank and the Swap Provider hereby
 authorises the Agent: 

 
	
  

 	
  

 	
  

 
	
 16.1.1

 	
  

 	
  

 	
 to execute
 such documents as may be approved by the Majority Banks for execution by the
 Agent; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 

71

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.1.2

 	
  

 	
  

 	
 (whether or not by or through employees or agents) to take such
 action on such Bank’s, the Issuing Bank’s and the Swap Provider’s behalf and
 to exercise such rights, remedies, powers and discretions as are specifically
 delegated to the Agent by this Agreement and/or any other Security Document,
 together with such powers and discretions as are reasonably incidental
 thereto. 

 
	
  

 
	
 16.2

 	
  

 	
 Agent’s actions 

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Any action taken by the Agent under or in relation to this Agreement
 or any of the other Security Documents whether with requisite authority or on
 the basis of appropriate instructions, received from the Majority Banks
 and/or the Issuing Bank and/or the Swap Provider (or as otherwise duly authorised)
 shall be binding on all the Banks, the Issuing Bank and the Swap Provider.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.3

 	
  

 	
 Agent’s duties 

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The Agent shall:

 
	
  

 	
  

 	
  

 	
  

 
	
 16.3.1

 	
  

 	
  

 	
 promptly notify each Bank, the Issuing Bank and the Swap Provider of
 the contents of each notice, certificate or other document received by it
 from the Borrowers under or pursuant to clauses 8.1.1, 8.1.5 and 8.1.7; and 

 
	
  

 	
  

 	
  

 	
  

 
	
 16.3.2

 	
  

 	
  

 	
 (subject to the other provisions of this clause 16) take (or instruct
 the Security Agent to take) such action or, as the case may be, refrain from
 taking (or authorise the Security Agent to refrain from taking) such action
 with respect to the exercise of any of its rights, remedies, powers and
 discretions as agent, as the Majority Banks may direct. 

 
	
  

 	
  

 	
  

 
	
 16.4

 	
  

 	
 Agent’s rights

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The Agent may:

 
	
  

 	
  

 	
  

 	
  

 
	
 16.4.1

 	
  

 	
  

 	
 in the exercise of any right, remedy, power or discretion in relation
 to any matter, or in any context, not expressly provided for by this
 Agreement or any of the other Security Documents, act or, as the case may be,
 refrain from acting (or authorise the Security Agent to act or refrain from
 acting) in accordance with the instructions of the Banks and/or the Issuing
 Bank and/or the Swap Provider, and shall be fully protected in so doing; 

 
	
  

 	
  

 	
  

 	
  

 
	
 16.4.2

 	
  

 	
  

 	
 unless and until it shall have received directions from the Majority
 Banks, take such action or, as the case may be, refrain from taking such
 action (or authorise the Security Agent to take or refrain from taking such
 action) in respect of a Default of which the Agent has actual knowledge as it
 shall deem advisable in the best interests of the Banks, the Issuing Bank and
 the Swap Provider (but shall not be obliged to do so); 

 
	
  

 	
  

 	
  

 	
  

 
	
 16.4.3

 	
  

 	
  

 	
 refrain from acting (or authorise the Security Agent to refrain from
 acting) in accordance with any instructions of the Banks and/or the Issuing
 Bank and/or the Swap Provider to institute any legal proceedings arising out
 of or in connection with this Agreement or any of the other Security
 Documents until it and/or the Security Agent has been indemnified and/or
 secured to its satisfaction against any and all costs, expenses or
 liabilities (including legal fees) which it would or might incur as a result;
 

 
	
  

 	
  

 	
  

 	
  

 
	
 16.4.4

 	
  

 	
  

 	
 deem and treat (i) each Bank as the person entitled to the benefit of
 the Contribution of such Bank for all purposes of this Agreement unless and
 until a notice shall have been filed with the Agent pursuant to clause 15.3
 and shall have become effective, and (ii) the office set opposite the name of
 each of the Banks in schedule 1 as such Bank’s lending office unless and
 until a written notice of change of lending office shall have been received
 by the Agent and the Agent may act upon any such notice unless and until the
 same is superseded by a further such notice; 

 
	
  

 	
  

 	
  

 	
  

 
	
 16.4.5

 	
  

 	
  

 	
 rely as to matters of fact which might reasonably be expected to be
 within the knowledge of any Security Party upon a certificate signed by any
 director or officer of the relevant Security Party on behalf of the relevant
 Security Party; and 

 

72

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.4.6

 	
  

 	
  

 	
 do anything which is in its opinion necessary or desirable to comply
 with any law or regulation in any jurisdiction. 

 
	
  

 	
  

 	
  

 
	
 16.5

 	
  

 	
 No liability of Arrangers or Agent 

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Neither of the Arrangers nor the Agent nor any of their respective
 employees and agents shall:

 
	
  

 	
  

 	
  

 	
  

 
	
 16.5.1

 	
  

 	
  

 	
 be obliged to make any enquiry as to the use of any of the proceeds
 of the Loan unless (in the case of the Agent) so required in writing by a
 Bank, in which case the Agent shall promptly make the appropriate request to
 the Borrowers; or 

 
	
  

 	
  

 	
  

 	
  

 
	
 16.5.2

 	
  

 	
  

 	
 be obliged to make any enquiry as to any breach or default by the
 Borrowers or any of them or any other Security Party in the performance or
 observance of any of the provisions of this Agreement or any of the other
 Security Documents or as to the existence of a Default unless (in the case of
 the Agent) the Agent has actual knowledge thereof or has been notified in
 writing thereof by a Bank, the Issuing Bank or the Swap Provider, in which
 case the Agent shall promptly notify the Banks, the Issuing Bank and the Swap
 Provider of the relevant event or circumstance; or 

 
	
  

 	
  

 	
  

 	
  

 
	
 16.5.3

 	
  

 	
  

 	
 be obliged to enquire whether or not any representation or warranty
 made by the Borrowers or any of them or any other Security Party pursuant to
 this Agreement or any of the other Security Documents is true; or 

 
	
  

 	
  

 	
  

 	
  

 
	
 16.5.4

 	
  

 	
  

 	
 be obliged to do anything (including, without limitation, disclosing
 any document or information) which would, or might in its opinion, be
 contrary to any law or regulation or be a breach of any duty of
 confidentiality or otherwise be actionable or render it liable to any person;
 or 

 
	
  

 	
  

 	
  

 	
  

 
	
 16.5.5

 	
  

 	
  

 	
 be obliged to account to any Bank, the Issuing Bank or the Swap
 Provider for any sum or the profit element of any sum received by it for its
 own account; or 

 
	
  

 	
  

 	
  

 	
  

 
	
 16.5.6

 	
  

 	
  

 	
 be obliged to institute any legal proceedings arising out of or in
 connection with this Agreement or any of the other Security Documents other
 than on the instructions of the Majority Banks; or 

 
	
  

 	
  

 	
  

 	
  

 
	
 16.5.7

 	
  

 	
  

 	
 be liable to any Bank, the Issuing Bank or the Swap Provider for any
 action taken or omitted under or in connection with this Agreement or any of
 the other Security Documents unless caused by its gross negligence or wilful
 misconduct. 

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 For the purposes of this clause 16, neither of the Arrangers nor the
 Agent shall be treated as having actual knowledge of any matter of which the
 corporate finance or any other division outside the agency or loan
 administration department of either Arranger or the person for the time being
 acting as the Agent may become aware in the context of corporate finance,
 advisory or lending activities from time to time undertaken by either
 Arranger or, as the case may be, the Agent for any Security Party or any
 other person which may be a trade competitor of any Security Party or may
 otherwise have commercial interests similar to those of any Security Party.

 
	
  

 	
  

 	
  

 
	
 16.6

 	
  

 	
 Non-reliance on Arrangers or Agent 

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Each Bank, the Issuing Bank and the Swap Provider acknowledges that
 it has not relied on any statement, opinion, forecast or other representation
 made by either Arranger or the Agent to induce it to enter into this
 Agreement or any of the other Security Documents and that it has made and
 will continue to make, without reliance on the Arrangers or the Agent and
 based on such documents as it considers appropriate, its own appraisal of the
 creditworthiness of the Security Parties and its own independent
 investigation of the financial condition, prospects and affairs of the Security
 Parties in connection with the making and continuation of such Bank’s
 Commitment, or Contribution or participation in the Guarantee Facility under
 this Agreement. Neither of the Arrangers nor the Agent shall have any duty or
 responsibility, either initially or on a continuing basis, to provide any
 Bank, the Issuing Bank or the Swap Provider with any credit or other
 information with respect to any Security Party whether coming into its
 possession before the making of the Loan or, in the case of the Issuing Bank,
 the issuing of Bank Guarantees or at any time or times thereafter other than
 as provided in clause 16.3.1.

 
	
  

 
	
 16.7

 	
  

 	
 No responsibility on Arrangers or Agent for
 Borrower’s performance 

 

73

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Neither of the Arrangers nor the Agent shall have any responsibility
 or liability to any Bank, the Issuing Bank or the Swap Provider:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.7.1

 	
  

 	
  

 	
 on account of the failure of any Security Party to perform its
 obligations under any of the Security Documents; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.7.2

 	
  

 	
  

 	
 for the financial condition of any Security Party; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.7.3

 	
  

 	
  

 	
 for the completeness or accuracy of any statements, representations
 or warranties in any of the Security Documents or any document delivered
 under any of the Security Documents; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.7.4

 	
  

 	
  

 	
 for the execution, effectiveness, adequacy, genuineness, validity,
 enforceability or admissibility in evidence of any of the Security Documents
 or of any certificate, report or other document executed or delivered under
 any of the Security Documents; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.7.5

 	
  

 	
  

 	
 to investigate or make any enquiry into the title of the Borrowers or
 any other Security Party to the Ships or any other security or any part
 thereof; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.7.6

 	
  

 	
  

 	
 for the failure to register any of the Security Documents with any
 official or regulatory body or office or elsewhere; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.7.7

 	
  

 	
  

 	
 for taking or omitting to take any other action under or in relation
 to any of the Security Documents or any aspect of any of the Security
 Documents; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.7.8

 	
  

 	
  

 	
 on account of the failure of the Security Agent to perform or
 discharge any of its duties or obligations under the Security Documents; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.7.9

 	
  

 	
  

 	
 otherwise in connection with this Agreement or its negotiation or for
 acting (or, as the case may be, refraining from acting) in accordance with
 the instructions of the Majority Banks, the Issuing Bank or the Swap
 Provider.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.8

 	
  

 	
 Reliance on documents and professional
 advice

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Each of the Arrangers and the Agent shall be entitled to rely on any
 communication, instrument or document believed by it to be genuine and
 correct and to have been signed or sent by the proper person and shall be
 entitled to rely as to legal or other professional matters on opinions and
 statements of any legal or other professional advisers selected or approved
 by it (including those in an Arranger’s or, as the case may be, the Agent’s
 employment).

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.9

 	
  

 	
 Other dealings

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Each of the Arrangers and the Agent may, without any liability to
 account to the Banks, the Issuing Bank or the Swap Provider, accept deposits
 from, lend money to, and generally engage in any kind of banking or other
 business with, and provide advisory or other services to, any Security Party
 or any of its Related Companies or any of the Banks, the Issuing Bank or the
 Swap Provider as if it were not an Arranger or, as the case may be, the
 Agent.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.10

 	
  

 	
 Rights of Agent as Bank; no partnership

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 With respect to its own Commitment, Contribution and participation in
 the Guarantee Facility (if any) the Agent shall have the same rights and
 powers under the Security Documents as any other Bank and may exercise the
 same as though it were not performing the duties and functions delegated to
 it under this Agreement and the term “Banks”
 shall, unless the context clearly otherwise indicates, include the Agent in
 its individual capacity as a Bank. This Agreement shall not and shall not be
 construed so as to constitute a partnership between the parties or any of
 them.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.11

 	
  

 	
 Amendments and waivers

 

74

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.11.1

 	
  

 	
  

 	
 Subject to clauses 16.11.3 and 16.11.4 the Agent may, with the
 consent of the Majority Banks (or if and to the extent expressly authorised
 by the other provisions of any of the Security Documents) and, if so
 instructed by the Majority Banks, the Agent shall:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 agree (or authorise the Security Agent to agree) amendments or
 modifications to any of the Security Documents with the Borrowers and/or any
 other Security Party; and/or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 vary or waive breaches of, or defaults under, or otherwise excuse
 performance of, any provision of any of the other Security Documents by the
 Borrowers and/or any other Security Party (or authorise the Security Agent to
 do so).

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Any such action so authorised and effected by the Agent shall be
 documented in such manner as the Agent shall (with the approval of the
 Majority Banks) determine, shall be promptly notified to the Banks, the
 Issuing Bank and the Swap Provider by the Agent and (without prejudice to the
 generality of clause 16.2) shall be binding on all the Banks, the Issuing
 Bank and the Swap Provider.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.11.2

 	
  

 	
  

 	
 Notwithstanding any provision to the contrary in this Agreement or
 any other Security Documents, none of the matters referred to in clause
 16.11.1 nor any other matter or action whatsoever in relation to this
 Agreement, the Security Documents and the transactions contemplated thereby,
 shall require or be deemed to require the instructions of all the Banks. In
 particular, even if a matter or action is interpreted or found to require
 action by all the Banks (whether for practical reasons (e.g. release of any
 Security Documents which are in the name of all Banks) or otherwise), any
 Banks dissenting with the instructions or decision of the Majority Banks
 shall take such action or refrain from taking such action, as required and
 instructed by the Majority Banks provided that the relevant instructions
 and/or decision of the Majority Banks apply to all the Banks (and not
 individual Banks).

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.11.3

 	
  

 	
  

 	
 The Agent shall be entitled (but not obliged) to (or to instruct the
 Security Agent to) make or grant any amendment, waiver or consent in relation
 to this Agreement or any other Security Documents, without obtaining the
 consent of the Majority Banks if such matter relates solely to:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 the signing of Transfer Certificates;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 amendments or waivers that the Agent reasonably believes to be of a
 purely mechanical or clerical nature;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 the correction of manifest errors; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (d)

 	
 decisions, consents, amendments, directions, waivers or any right
 that the Security Documents expressly state may be made by the Agent or the
 Security Agent.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 The Agent shall promptly notify the other parties to this Agreement
 of any amendment or waiver effected by it under this clause 16.11.3.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.11.4

 	
  

 	
  

 	
 An amendment or waiver which relates to the rights or obligations of
 the Agent, the Security Agent, the Issuing Bank and an Arranger may not be
 effected without the consent of the Agent, the Security Agent, the Issuing
 Bank or (as the case may be) that Arranger, respectively.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.12

 	
  

 	
 Reimbursement and indemnity by Banks

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Each Bank shall reimburse the Agent (rateably, if prior to the first
 drawdown, in accordance with such Bank’s aggregate Commitment or, if after
 the first drawdown, in accordance with such Bank’s Contribution), to the
 extent that the Agent is not reimbursed by the Borrowers, for the costs,
 charges and expenses incurred by the Agent which are expressed to be payable
 by the Borrowers under clause 5.1 including (in each case) the fees and
 expenses of legal or other professional advisers. Each Bank shall on demand
 indemnify the Agent (rateably, if prior to the first drawdown, in accordance
 with such Bank’s aggregate Commitment or, if after the first drawdown, in
 accordance with such Bank’s Contribution) against all liabilities, damages,
 costs and claims whatsoever incurred by the Agent in connection with any of
 the Security Documents or the performance of its duties under any of the

 

75

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Security
 Documents or any action taken or omitted by the Agent under any of the
 Security Documents, unless such liabilities, damages, costs or claims arise
 from the Agent’s own gross negligence or wilful misconduct.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.13

 	
  

 	
 Retirement of Agent

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.13.1

 	
  

 	
  

 	
 The Agent
 may, having given to the Borrowers and each of the Banks, the Issuing Bank
 and the Swap Provider not less than fifteen (15) days’ notice of its intention
 to do so, retire from its appointment as Agent under this Agreement, provided
 that no such retirement shall take effect unless there has been appointed by
 the Banks, the Issuing Bank and the Swap Provider as a successor agent:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 a reputable
 and experienced bank nominated by the Borrowers and accepted by the Majority
 Banks in their reasonable discretion or, failing such nomination or
 acceptance,

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 a Related
 Company of the Agent nominated by the Agent which the Banks, the Issuing Bank
 and the Swap Provider hereby irrevocably and unconditionally agree to appoint
 or, failing such nomination,

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 a Bank
 nominated by the Majority Banks or, failing such a nomination,

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (d)

 	
 any
 reputable and experienced bank or financial institution nominated by the
 retiring Agent.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Any
 corporation into which the retiring Agent may be merged or converted or any
 corporation with which the Agent may be consolidated or any corporation
 resulting from any merger, conversion, amalgamation, consolidation or other
 reorganisation to which the Agent shall be a party shall, to the extent
 permitted by applicable law, be the successor Agent under this Agreement and
 the other Security Documents without the execution or filing of any document
 or any further act on the part of any of the parties to this Agreement and
 the other Security Documents save that notice of any such merger, conversion,
 amalgamation, consolidation or other reorganisation shall forthwith be given
 to each Security Party, the Banks, the Issuing Bank and the Swap Provider.
 Prior to any such successor being appointed the Agent agrees to consult with
 the Borrowers as to the identity of the proposed successor.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.13.2

 	
  

 	
  

 	
 Upon any
 such successor as aforesaid being appointed, the retiring Agent shall be
 discharged from any further obligation under the Security Documents (but
 shall continue to have the benefit of this clause 16 in respect of any action
 it has taken or refrained from taking prior to such discharge) and its
 successor and each of the other parties to this Agreement shall have the same
 rights and obligations among themselves as they would have had if such
 successor had been a party to this Agreement in place of the retiring Agent.
 The retiring Agent shall (at its own expense) provide its successor with
 copies of such of its records as its successor reasonably requires to carry
 out its functions under the Security Documents.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.14

 	
  

 	
 Appointment and retirement of Security Agent

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.14.1

 	
  

 	
  

 	
 Appointment

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Each of the
 Banks, the Agent, the Issuing Bank and the Swap Provider irrevocably appoints
 the Security Agent as its security agent and trustee for the purposes of this
 Agreement and the other Security Documents, in each case on the terms set out
 in this Agreement. By virtue of such appointment, each of the Banks, the
 Agent, the Issuing Bank and the Swap Provider hereby authorises the Security
 Agent (whether or not by or through employees or agents) to take such action
 on its behalf and to exercise such rights, remedies, powers and discretions
 as are specifically delegated to the other Security Agent by this Agreement
 and/or the other Security Documents, together with such powers and
 discretions as are reasonably incidental thereto.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.14.2

 	
  

 	
  

 	
 Retirement

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Without
 prejudice to clause 16.13, the Security Agent may, having given to the
 Borrowers, the Agent, each of the Banks, the Issuing Bank and the Swap
 Provider not less than fifteen (15) days’

 

76

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 notice
 of its intention to do so, retire from its appointment as Security Agent
 under this Agreement and any Trust Deed, provided that no such retirement
 shall take effect unless there has been appointed by the Banks, the Agent,
 the Issuing Bank and the Swap Provider as a successor security agent and
 trustee:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 a
 reputable and experienced bank nominated by the Borrowers and accepted by the
 Majority Banks in their reasonable discretion or, failing such nomination or
 acceptance,

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 a
 Related Company of the Security Agent nominated by the Security Agent which
 the Banks, the Agent, the Issuing Bank and the Swap Provider hereby
 irrevocably and unconditionally agree to appoint or, failing such nomination,

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 a
 bank or trust corporation nominated by the Majority Banks or, failing such a
 nomination,

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (d)

 	
 any
 bank or trust corporation nominated by the retiring Security Agent,

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 and,
 in any case, such successor security agent and trustee shall have duly accepted
 such appointment by delivering to the Agent (i) written confirmation (in a
 form acceptable to the Agent) of such acceptance agreeing to be bound by this
 Agreement in the capacity of Security Agent as if it had been an original
 party to this Agreement and (ii) a duly executed Trust Deed and (iii) such
 successor security agent and trustee shall have duly entered into, whether
 with the retiring Security Agent and/or with the Borrowers and/or with the
 Creditors or with any of them, such documents in connection with the Security
 Documents as the Agent shall require in its absolute discretion.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Any
 corporation into which the retiring Security Agent may be merged or converted
 or any corporation with which the Security Agent may be consolidated or any
 corporation resulting from any merger, conversion, amalgamation,
 consolidation or other reorganisation to which the Security Agent shall be a
 party shall, to the extent permitted by applicable law, be the successor
 Security Agent under this Agreement, any Trust Deed and the other Security
 Documents without the execution or filing of any document or any further act
 on the part of any of the parties to this Agreement, any Trust Deed and the
 other Security Documents save that notice of any such merger, conversion,
 amalgamation, consolidation or other reorganisation shall forthwith be given
 to each Security Party and the Banks, the Issuing Bank and the Swap Provider.
 Prior to any such successor being appointed, the Security Agent agrees to
 consult with the Borrowers as to the identity of the proposed successor.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Upon
 any such successor as aforesaid being appointed, the retiring Security Agent
 shall be discharged from any further obligation under the Security Documents
 (but shall continue to have the benefit of this clause 16 in respect of any
 action it has taken or refrained from taking prior to such discharge) and its
 successor and each of the other parties to this Agreement shall have the same
 rights and obligations among themselves as they would have had if such
 successor had been a party to this Agreement in place of the retiring
 Security Agent. The retiring Security Agent shall (at the expense of the
 Borrowers) provide its successor with copies of such of its records as its
 successor reasonably requires to carry out its functions under the Security
 Documents.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.15

 	
  

 	
 Powers and duties of the Security Agent

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.15.1

 	
  

 	
  

 	
 The
 Security Agent shall have no duties, obligations or liabilities to any of the
 Banks, the Issuing Bank, the Swap Provider and the Agent beyond those
 expressly stated in any of the Security Documents. Each of the Agent, the
 Issuing Bank, the Swap Provider and the Banks hereby authorises the Security
 Agent to enter into and execute:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 each
 of the Security Documents to which the Security Agent is or is intended to be
 a party; and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 any
 and all such other Security Documents as may be approved by the Agent in
 writing (acting on the instructions of the Majority Banks) for entry into by
 the Security Agent,

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 and,
 in each and every case, to hold any and all security thereby created upon
 trust for the Banks and the Agent in the manner contemplated by this
 Agreement.

 

77

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.15.2

 	
  

 	
  

 	
 Subject
 to clause 16.15.3 the Security Agent may, with the prior consent of the
 Majority Banks communicated in writing by the Agent, concur with any of the
 Security Parties to:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 amend,
 modify or otherwise vary any provision of the Security Documents to which the
 Security Agent is or is intended to be a party; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 waive
 breaches of, or defaults under, or otherwise excuse performance of, any
 provision of the Security Documents to which the Security Agent is or is
 intended to be a party.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Any
 such action so authorised and effected by the Security Agent shall be
 promptly notified to the Banks, the Issuing Bank, the Swap Provider and the
 Agent by the Security Agent and shall be binding on the other Creditors.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.15.3

 	
  

 	
  

 	
 The
 Security Agent shall (subject to the other provisions of this clause 16) take
 such action or, as the case may be, refrain from taking such action, with
 respect to any of its rights, powers and discretions as security agent and
 trustee, as the Agent may direct. Subject as provided in the foregoing
 provisions of this clause, unless and until the Security Agent shall have
 received such instructions from the Agent, the Security Agent may, but shall
 not be obliged to, take (or refrain from taking) such action under or
 pursuant to the Security Documents referred to in clause 16.14 as the
 Security Agent shall deem advisable in the best interests of the Creditors
 provided that (for the avoidance of doubt), to the extent that this clause
 might otherwise be construed as authorising the Security Agent to take, or
 refrain from taking, any action of the nature referred to in clause 16.15.2.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.15.4

 	
  

 	
  

 	
 None
 of the Banks nor the Agent nor the Issuing Bank nor the Swap Provider shall
 have any independent power to enforce any of the Security Documents referred
 to in clause 16.15.1 or to exercise any rights, discretions or powers or to
 grant any consents or releases under or pursuant to such Security Documents
 or any of them or otherwise have direct recourse to the security and/or
 guarantees constituted by such Security Documents or any of them except
 through the Security Agent.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.15.5

 	
  

 	
  

 	
 For
 the purpose of this clause 16, the Security Agent may, rely and act in
 reliance upon any information from time to time furnished to the Security
 Agent by the Agent (whether pursuant to clause 16.15.6 or otherwise) unless
 and until the same is superseded by further such information, so that the
 Security Agent shall have no liability or responsibility to any party as a
 consequence of placing reliance on and acting in reliance upon any such
 information unless the Security Agent has actual knowledge that such
 information is inaccurate or incorrect.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.15.6

 	
  

 	
  

 	
 Without
 prejudice to the foregoing each of the Agent, the Issuing Bank, the Swap
 Provider and the Banks (whether directly or through the Agent) shall provide
 the Security Agent with such written information as it may reasonably require
 for the purpose of carrying out its duties and obligations under the Security
 Documents referred to in clause 16.15.1.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.15.7

 	
  

 	
  

 	
 Each
 Bank shall reimburse the Security Agent (rateably in accordance with such
 Bank’s Commitment or, after the first drawdown, Contribution), to the extent
 that the Security Agent is not reimbursed by the Borrowers, for the costs,
 charges and expenses incurred by the Security Agent which are expressed to be
 payable by the Borrowers under clause 5.2 including (in each case) the fees
 and expenses of legal or other professional advisers. Each Bank shall on
 demand indemnify the Security Agent (rateably in accordance with such Bank’s
 Commitment or, after the first drawdown, Contribution) against all
 liabilities, damages, costs and claims whatsoever incurred by the Security
 Agent in connection with any of the Security Documents or the performance of
 its duties under any of the Security Documents or any action taken or omitted
 by the Security Agent under any of the Security Documents, unless such
 liabilities, damages, costs or claims arise from the Security Agent’s own
 gross negligence or wilful misconduct.

 

78

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.16

 	
  

 	
 Trust provisions

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.16.1

 	
  

 	
  

 	
 In
 its capacity as trustee in relation to the Security Documents specified in
 clause 16.15.1, the Security Agent shall, without prejudice to any of the
 powers, discretions and immunities conferred upon trustees by law (and to the
 extent not inconsistent with the provisions of any of those Security
 Documents), have all the same powers and discretions as a natural person
 acting as the beneficial owner of such property and/or as are conferred upon
 the Security Agent by any of those Security Documents.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.16.2

 	
  

 	
  

 	
 It
 is expressly declared that, in its capacity as trustee in relation to the
 Security Documents specified in clause 16.15.1, the Security Agent shall be
 entitled to invest moneys forming part of the security and which, in the
 opinion of the Security Agent, may not be paid out promptly following receipt
 in the name or under the control of the Security Agent in any of the
 investments for the time being authorised by law for the investment by
 trustees of trust moneys or in any other property or investments whether
 similar to the aforesaid or not or by placing the same on deposit in the name
 or under the control of the Security Agent as the Security Agent may think
 fit without being under any duty to diversify its investments and the
 Security Agent may at any time vary or transpose any such property or
 investments for or into any others of a like nature and shall not be
 responsible for any loss due to depreciation in value or otherwise of such
 property or investments. Any investment of any part or all of the security
 may, at the discretion of the Security Agent, be made or retained in the
 names of nominees.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.17

 	
  

 	
 Independent action by Creditors

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 None
 of the Creditors shall enforce, exercise any rights, remedies or powers or
 grant any consents or releases under or pursuant to, or otherwise have a
 direct recourse to the security and/or guarantees constituted by any of the
 Security Documents without the prior written consent of the Majority Banks
 but, Provided such consent has been obtained, it shall not be necessary for
 any other Creditor to be joined as an additional party in any proceedings for
 this purpose.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.18

 	
  

 	
 Common Agent and Security Agent

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The
 Agent and the Security Agent have entered into the Security Documents in
 their separate capacities (a) as agent for the Banks, the Issuing Bank and the
 Swap Provider under and pursuant to this Agreement (in the case of the Agent)
 and (b) as security agent and trustee for the Banks, the Agent, the Issuing
 Bank and the Swap Provider under and pursuant to this Agreement, to hold the
 guarantees and/or security created by the Security Documents specified in
 clause 16.15.1 on the terms set out in such Security Documents (in the case
 of the Security Agent). However, from time to time the Agent and the Security
 Agent may be the same entity. When the Agent and the Security Agent are the
 same entity and any Security Document provides for the Agent to communicate
 with or provide instructions to the Security Agent (and vice versa), it will
 not be necessary for there to be any such formal communications or
 instructions on those occasions.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.19

 	
  

 	
 Co-operation to achieve agreed priorities of application

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The
 Banks, the Issuing Bank, the Swap Provider and the Agent shall co-operate
 with each other and with the Security Agent and any receiver under the
 Security Documents in realising the property and assets subject to the
 Security Documents and in ensuring that the net proceeds realised under the
 Security Documents after deduction of the expenses of realisation are applied
 in accordance with clause 13.1.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.20

 	
  

 	
 Prompt distribution of proceeds

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Moneys
 received by any of the Creditors (whether from a receiver or otherwise)
 pursuant to the exercise of (or otherwise by virtue of the existence of) any
 rights and powers under or pursuant to any of the Security Documents shall
 (after providing for all costs, charges, expenses and liabilities and other
 payments ranking in priority) be paid to the Agent for distribution (in the
 case of moneys so received by any of the Creditors other than the Agent or
 the Security Agent), and shall be distributed by the Agent or, as the case
 may be, the Security Agent (in the case of moneys so received by the Agent
 or, as the case may be, the Security Agent), in each case in accordance with
 clause 13.1. The Agent or, as the

 

79

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 case
 may be, the Security Agent shall make each such application and/or
 distribution as soon as is practicable after the relevant moneys are received
 by, or otherwise become available to, the Agent or, as the case may be, the
 Security Agent save that (without prejudice to any other provision contained
 in any of the Security Documents) the Agent or, as the case may be, the
 Security Agent (acting on the instructions of the Majority Banks) or any
 receiver may credit any moneys received by it to a suspense account for so
 long and in such manner as the Agent or such receiver may from time to time
 determine with a view to preserving the rights of the Agent and/or the
 Security Agent and/or the Account Bank and/or the Arrangers and/or the Banks
 and/or the Issuing Bank and/or the Swap Provider or any of them to prove for
 the whole of their respective claims against the Borrowers or any other
 person liable.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 17

 	
  

 	
 Notices and other matters

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 17.1

 	
  

 	
 Notices

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

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

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 17.1.1

 	
  

 	
  

 	
 be
 in writing delivered personally or by first-class prepaid letter (airmail if
 available) or facsimile transmission or other means of telecommunication in
 permanent written form;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 17.1.2

 	
  

 	
  

 	
 be
 deemed to have been received, subject as otherwise provided in the relevant
 Security Document, in the case of a letter, when delivered personally or
 three (3) days after it has been put in to the post and, in the case of a
 facsimile transmission or other means of telecommunication in permanent
 written form, at the time of despatch (provided that if the date of despatch
 is not a business day in the country of the addressee or if the time of
 despatch is after the close of business in the country of the addressee it
 shall be deemed to have been received at the opening of business on the next
 such business day); and

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 17.1.3

 	
  

 	
  

 	
 be
 sent (subject to clause 17.2 herein):

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 if
 to the Borrowers or any of them at:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 c/o
 Costamare Inc.

 
	
  

 	
  

 	
  

 	
  

 	
 c/o
 Costamare Shipping Company S.A.

 
	
  

 	
  

 	
  

 	
  

 	
 60
 Zephyrou Street & Syngrou Avenue

 
	
  

 	
  

 	
  

 	
  

 	
 Athens
 175 64

 
	
  

 	
  

 	
  

 	
  

 	
 Greece

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 Fax
 no:      +30 210 9409 051

 
	
  

 	
  

 	
  

 	
  

 	
 Attn:         
 CFO (of Costamare Inc.)

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 if
 to the Agent, the Security Agent or the Account Bank, at:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 DnB
 NOR Bank ASA

 
	
  

 	
  

 	
  

 	
  

 	
 20
 St. Dunstan’s Hill

 
	
  

 	
  

 	
  

 	
  

 	
 London
 EC3R 8HY

 
	
  

 	
  

 	
  

 	
  

 	
 England

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 Fax
 No:        +44 207 626 5956

 
	
  

 	
  

 	
  

 	
  

 	
 Attention:     Shipping Department

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 if
 to the Issuing Bank at:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 The
 Export-Import Bank of China

 
	
  

 	
  

 	
  

 	
  

 	
 No.
 30, Fuxingmen Nei Street

 
	
  

 	
  

 	
  

 	
  

 	
 Xicheng
 District

 
	
  

 	
  

 	
  

 	
  

 	
 Beijing
 10031

 
	
  

 	
  

 	
  

 	
  

 	
 People’s
 Republic of China

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 Fax No:      +8610 8357 8428 / 8357 8429

 
	
  

 	
  

 	
  

 	
  

 	
 Attn:            Shipping
 Finance

 

80

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (d)

 	
 if to a Bank (including, if applicable, in its capacity as Guarantee
 Bank and Arranger), to its address or fax number specified in schedule 1 or,
 in the case of a Transferee Bank, in any relevant Transfer Certificate; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (e)

 	
 if to the Swap Provider, to its address or fax number specified in
 paragraph (a) of Part 4 of the schedule to the Master Agreement,

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 or to such other address and/or numbers as is notified by one party
 to the other parties under this Agreement.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 17.2

 	
  

 	
 Notices through the Agent 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Every notice, request, demand or other communication under this
 Agreement or (unless otherwise provided therein) any other Security Document
 to be given by the Borrowers or any of them to any other party (other than
 the Swap Provider), shall be given to the Agent for onward transmission as
 appropriate and if such notice, request, demand or other communication is to
 be given to the Borrowers it shall (except otherwise provided in the Security
 Documents) be given to the Agent for onward transmission to the Borrowers.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 17.3

 	
  

 	
 No implied waivers, remedies cumulative 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 No failure or delay on the part of a Creditor to exercise any power,
 right or remedy under any of the Security Documents shall operate as a waiver
 thereof, nor shall any single or partial exercise by such Creditor of any
 power, right or remedy preclude any other or further exercise thereof or the
 exercise of any other power, right or remedy. The remedies provided in the
 Security Documents are cumulative and are not exclusive of any remedies
 provided by law.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 17.4

 	
  

 	
 English language 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

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

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 17.5

 	
  

 	
 Borrowers’ obligations 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 17.5.1

 	
  

 	
  

 	
 Joint and several 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Notwithstanding anything to the contrary contained in any of the
 Security Documents, the agreements, obligations and liabilities of the
 Borrowers herein contained are joint and several and shall be construed
 accordingly. Each of the Borrowers agrees and consents to be bound by the Security
 Documents to which it is, or is to be, a party notwithstanding that the other
 Borrowers which are intended to sign or to be bound may not do so or be
 effectually bound and notwithstanding that any of the Security Documents may
 be invalid or unenforceable against the other Borrowers, whether or not the
 deficiency is known to any of the Creditors.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 17.5.2

 	
  

 	
  

 	
 Borrowers as principal debtors 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Each Borrower acknowledges and confirms that it is a principal and
 original debtor in respect of all amounts which may become payable by the
 Borrowers in accordance with the terms of this Agreement or any of the other
 Security Documents and agrees that the Creditors may also continue to treat
 it as such, whether or not any Creditor is or becomes aware that such
 Borrower is or has become a surety for the other Borrowers.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 17.5.3

 	
  

 	
  

 	
 Indemnity 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 The Borrowers hereby agree jointly and severally to keep the
 Creditors fully indemnified on demand against all damages, losses, costs and
 expenses arising from any failure of any Borrower to perform or discharge any purported obligation or liability of the
 other Borrowers which would have been the subject of this Agreement or any
 other Security Document had it been valid and enforceable and which is not or
 ceases to be valid and enforceable against the other Borrowers on

 

81

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 any ground
 whatsoever, whether or not known to a Creditor including, without limitation,
 any irregular exercise or absence of any corporate power or lack of authority
 of, or breach of duty by, any person purporting to act on behalf of the other
 Borrowers (or any legal or other limitation, whether under the Limitation
 Acts or otherwise or any disability or death, bankruptcy, unsoundness of
 mind, insolvency, liquidation, dissolution, winding up, administration,
 receivership, amalgamation, reconstruction or any other incapacity of any
 person whatsoever (including, in the case of a partnership, a termination or
 change in the composition of the partnership) or any change of name or style
 or constitution of any Security Party)).

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 17.5.4

 	
  

 	
  

 	
 Liability unconditional 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 None of the obligations or liabilities of the Borrowers under this
 Agreement or any other Security Document shall be discharged or reduced by
 reason of:

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 the death, bankruptcy, unsoundness of mind, insolvency, liquidation,
 dissolution, winding-up, administration, receivership, amalgamation,
 reconstruction or other incapacity of any person whatsoever (including, in
 the case of a partnership, a termination or change in the composition of the
 partnership) or any change of name or style or constitution of any Borrower
 or any other person liable;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 the Agent or the Security Agent (acting on the instructions of the
 Majority Banks) granting any time, indulgence or concession to, or
 compounding with, discharging, releasing or varying the liability of, any
 Borrower or any other person liable or renewing, determining, varying or
 increasing any accommodation, facility or transaction or otherwise dealing
 with the same in any manner whatsoever or concurring in, accepting, varying
 any compromise, arrangement or settlement or omitting to claim or enforce
 payment from any Borrower or any other person liable; or

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 anything done or omitted which but for this provision might operate
 to exonerate the Borrowers or any of them.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 17.5.5

 	
  

 	
  

 	
 Recourse to other security 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 The Creditors shall not be obliged to make any claim or demand or to
 resort to any Security Document or other means of payment now or hereafter
 held by or available to it for enforcing this Agreement or any of the
 Security Documents against any Borrower or any other person liable and no
 action taken or omitted by any Creditor in connection with any such Security
 Document or other means of payment will discharge, reduce, prejudice or
 affect the liability of the Borrowers under this Agreement and the Security
 Documents to which any of them is, or is to be, a party.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 17.5.6

 	
  

 	
  

 	
 Waiver of Borrowers’ rights 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Each Borrower agrees with each Creditor that, from the date of this
 Agreement and so long as any moneys are owing under any of the Security
 Documents and while all or any part of the Total Commitment or the Facility
 Commitment remains outstanding, it will not, without the prior written
 consent of the Agent (acting on the instructions of the Majority Banks):

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (a)

 	
 exercise any right of subrogation, reimbursement and indemnity
 against the other Borrowers or any other person liable under the Security
 Documents;

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (b)

 	
 demand or accept repayment in whole or in part of any Indebtedness
 now or hereafter due to such Borrower from the other Borrowers or from any
 other person liable or demand or accept any guarantee, indemnity or other
 assurance against financial loss or any document or instrument created or
 evidencing an Encumbrance in respect of the same or dispose of the same;

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (c)

 	
 take any steps to enforce any right against the other Borrowers or
 any other person liable in respect of any such moneys; or

 

82

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 (d)

 	
 claim any
 set-off or counterclaim against the other Borrowers or any other person
 liable or claiming or proving in competition with any Creditor in the
 liquidation of the other Borrowers or any other person liable or have the
 benefit of, or share in, any payment from or composition with, the other
 Borrowers or any other person liable or any other Security Document now or
 hereafter held by any Creditor for any moneys owing under this Agreement or
 for the obligations or liabilities of any other person liable but so that, if
 so directed by the Agent, it will prove for the whole or any part of its
 claim in the liquidation of the other Borrowers or other person liable on
 terms that the benefit of such proof and all money received by it in respect
 thereof shall be held on trust for the Banks and applied in or towards
 discharge of any moneys owing under this Agreement in such manner as the
 Agent (acting on the instructions of the Majority Banks) shall deem
 appropriate.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 18

 	
  

 	
 Governing law and jurisdiction

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 18.1 

 	
  

 	
 Law

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 This
 Agreement and any non-contractual obligations connected with it are governed
 by, and shall be construed in accordance with, English law.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 18.2

 	
  

 	
 Submission to jurisdiction

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The
 Borrowers jointly and severally agree, for the benefit of each Creditor, that
 any legal action or proceedings arising out of or in connection with this
 Agreement (including any non-contractual obligations connected with this
 Agreement) against the Borrowers or any of them or any of their assets may be
 brought in the English courts. Each of the Borrowers irrevocably and
 unconditionally submits to the jurisdiction of such courts and irrevocably
 designates, appoints and empowers Mr Richard Coleman c/o H. Clarkson and Co.
 Ltd. at present of 3 Lower Thames Street, London EC3R 6HE, England to
 receive, for it and on its behalf, service of process issued out of the
 courts of England in any such legal action or proceedings and, in the event
 that such individual passes away or cannot be found, each of the Borrowers
 hereby undertakes (and each of the Borrowers hereby irrevocably and
 unconditionally authorises the Agent (for and on behalf of each Creditor) to
 do so) to designate, appoint and empower on its behalf, Messrs Saville &
 Co. at their then principal place of business in London as substitute process
 agents of Mr Richard Coleman for the purposes of this clause. The submission
 to such jurisdiction shall not (and shall not be construed so as to) limit
 the right of a Creditor to take proceedings against the Borrowers or any of
 them in the courts of any other competent jurisdiction nor shall the taking
 of proceedings in any one or more jurisdictions preclude the taking of
 proceedings in any other jurisdiction, whether concurrently or not.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The parties
 further agree that only the courts of England and not those of any other
 State shall have jurisdiction to determine any claim which the Borrowers or
 any of them may have against any Creditor arising out of or in connection
 with this Agreement (including any non-contractual obligations connected with
 this Agreement).

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 18.3

 	
  

 	
 Contracts (Rights of Third Parties) Act 1999

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

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

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

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

 

83

Schedule 1

The Banks and their Commitments and the Guarantee
Banks and their Percentages

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Name

 	
  

 	
 Lending office and contact details

 	
  

 	
 Commitment

 ($)

 	
  

 	
 Bank Guarantees -

 Percentages 

 
	

 

 	
  

 	

 

 	
  

 	

 

 	
  

 	

 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 DnB NOR Bank ASA

 	
  

 	
 Lending Office

 	
  

 	
 81,337,200

 	
  

 	
 40%

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 20 St.
 Dunstan’s Hill

 London EC3R 8HY

 England

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Address for Notices

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 20 St.
 Dunstan’s Hill

 London EC3R 8HY

 England

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Fax:          +44
 207 626 5956

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Attn:          Shipping
 Department

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 The Export-Import Bank of China

 	
  

 	
 Lending Office

 	
  

 	
 61,002,900

 	
  

 	
 60%

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 No. 30,
 Fuxingmen Nei Street

 Xicheng District

 Beijing 10031

 People’s Republic of China

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Address for Notices

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 No. 30,
 Fuxingmen Nei Street

 Xicheng District

 Beijing 10031

 People’s Republic of China

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Fax
 No:     +8610 83578428/83578429

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Attn:          Shipping
 Finance

 	
  

 	
  

 	
  

 	
  

 

84

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Name

 	
  

 	
 Lending office and contact details

 	
  

 	
 Commitment

 ($)

 	
  

 	
 Bank Guarantees -

 Percentages

 
	

 

 	
  

 	

 

 	
  

 	

 

 	
  

 	

 

 
	
 China Everbright Bank

 	
  

 	
 Lending Office

 	
  

 	
 61,002,900

 	
  

 	
 0%

 (not a Guarantee

 Bank)

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Shanghai
 Branch

 No. 1118 Shiji Avenue

 Shanghai 200120

 People’s Republic of China

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Address for Notices

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 No. 1118
 Shiji Avenue

 Shanghai 200120

 People’s Republic of China

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Fax
 No:     +86 21 608 62005

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Attn:          Caroline
 Chen

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 

 	
  

 	
  

 
	
 TOTAL COMMITMENT

 	
  

 	
  

 	
  

 	
 203,343,000

 	
  

 	
  

 

85

Schedule 2

Form of Drawdown Notice and Bank Guarantee Request

Part 1

Form of Drawdown Notice

(referred to in clause 2.4)

	
  

 	
  

 
	
 To:

 	
 DnB NOR Bank
 ASA

 
	
  

 	
 20 St
 Dunstan’s Hill 

 
	
  

 	
 London EC3R
 8HY 

 
	
  

 	
 England

 
	
  

 	
 (as Agent)

 

[•] 20[•] 

US$203,343,000 Loan Facility and US$28,856,781
Guarantee Facility 

Facility Agreement dated 14 January 2011 (the
“Facility Agreement”) 

We refer to the Facility Agreement and hereby give you notice that we
wish to draw down the [•] Advance[s] namely $[•] on [•] 20[•] and select [a first Interest Period in respect thereof of [•] months] [the first interest
period in respect hereof to expire on [•] 200[•]]. The funds should be
credited to [provide Seller’s bank details
and SWIFT address].  

We confirm that: 

	
  

 	
  

 
	
 (a)

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

 
	
  

 	
  

 
	
 (b)

 	
  the representations and warranties contained in (i) clauses 7.1, 7.2
 and 7.3(b) of the Facility Agreement and (ii) clause 4 of the Corporate
 Guarantee, are true and correct at the date hereof as if made with respect to
 the facts and circumstances existing at such date; 

 
	
  

 	
  

 
	
 (c)

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

 
	
  

 	
  

 
	
 (d)

 	
  no event has occurred or any other circumstances arisen or developed
 including, without limitation, a material adverse change in the financial
 position, state of affairs or prospects of any Security Party in light of
 which there is a significant risk that the Corporate Guarantor or any
 Borrower or any other Security Party is, or will later become, unable to
 discharge its liabilities under the Security Documents as they fall due; and 

 
	
  

 	
  

 
	
 (e)

 	
 the said Advance[s] will be used for our own benefit and under our
 full responsibility and exclusively for the purpose specified in clauses 1.1
 and 2.5 of the Facility Agreement. 

 

Words and expressions defined in the Facility Agreement shall have the
same meanings where used herein. 

	
  

 
	

 

 

 
	
 For and on behalf of each of

 
	
 ADELE SHIPPING CO. 

 
	
 BASTIAN SHIPPING CO. 

 
	
 CADENCE SHIPPING CO. 

 

86

Part 2

Form of Bank Guarantee Request

(referred to in clause 2.4)

	
  

 	
  

 
	
 To:

 	
 DnB NOR Bank
 ASA

 
	
  

 	
 20 St
 Dunstan’s Hill

 
	
  

 	
 London EC3R
 8HY

 
	
  

 	
 England

 
	
  

 	
 (as Agent)

 
	
  

 	
  

 
	
 Cc:

 	
 The
 Export-Import Bank of China

 
	
  

 	
 No. 30,
 Fuxingmen Nei Street

 
	
  

 	
 Xicheng
 District

 
	
  

 	
 Beijing
 10031

 
	
  

 	
 People’s
 Republic of China

 
	
  

 	
 (as Issuing
 Bank)

 

[•] 20[•] 

US$203,343,000 Loan Facility and
US$28,856,781 Guarantee Facility Facility

Agreement dated 14 January 2011 (the “Facility Agreement”) 

We refer to the Facility Agreement and hereby request that the Issuing
Bank issues the [Adele] [Bastian] [Cadence] Bank Guarantee in favour of the
Seller on [•] 20[•] to the following bank (being the Seller’s bank):  [provide Seller’s
bank details and SWIFT address].

We confirm that: 

	
  

 	
  

 
	
 (a)

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

 
	
  

 	
  

 
	
 (b)

 	
 the
 representations and warranties contained in clauses 7.1, 7.2 and 7.3(b) of
 the Facility Agreement are true and correct at the date hereof as if made
 with respect to the facts and circumstances existing at such date; and 

 
	
  

 	
  

 
	
 (c)

 	
 no event has
 occurred or any other circumstances arisen or developed including, without
 limitation, a material adverse change in the financial position, state of
 affairs or prospects of any Security Party in light of which there is a
 significant risk that the Corporate Guarantor or any Borrower or any other
 Security Party is, or will later become, unable to discharge its liabilities
 under the Security Documents as they fall due. 

 

Words and expressions defined in the Facility Agreement shall have the
same meanings where used herein. 

	
  

 
	

 

 
	
 For and on
 behalf of each of

 
	
 ADELE
SHIPPING CO. 

 
	
 BASTIAN
SHIPPING CO. 

 
	
 CADENCE
SHIPPING CO. 

 

87

Schedule 3

Documents and evidence required as conditions precedent

(referred to in clause 9.1)

Part
1

	
  

 	
  

 	
  

 	
  

 
	
 1

 	
  

 	
 Constitutional documents

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Copies, certified by legal counsel of each Security Party as true,
 complete and up to date copies of all documents which contain or establish or
 relate to the constitution of that Security Party;

 
	
  

 	
  

 	
  

 
	
 2

 	
  

 	
 Corporate authorisations

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 copies of resolutions of the directors of each Security Party and
 stockholders of each Security Party (other than the Corporate Guarantor)
 approving such of the Underlying Documents and the Security Documents to
 which such Security Party is, or is to be, party and authorising the
 signature, delivery and performance of such Security Party’s obligations
 thereunder, certified (in a certificate dated no earlier than five (5)
 Banking Days prior to the date of this Agreement) by an officer of such
 Security Party as:

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (a)

 	
 being true and correct;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 being duly passed at meetings of the directors of such Security Party
 and, where applicable, of the stockholders of such Security Party duly
 convened and held;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (c)

 	
 not having been amended, modified or revoked; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (d)

 	
 being in full force and effect,

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 together with originals or certified copies of any powers of attorney
 issued by any Security Party pursuant to such resolutions;

 
	
  

 	
  

 	
  

 
	
 3

 	
  

 	
 Specimen signatures

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 copies of the signatures of the persons who have been authorised on
 behalf of each Security Party to sign such of the Underlying Documents and
 the Security Documents to which such Security Party is, or is to be, party
 and to give notices and communications, including notices of drawing, under
 or in connection with the Security Documents, certified (in a certificate
 dated no earlier than five (5) Banking Days prior to the date of this
 Agreement) by an officer of such Security Party as being the true signatures
 of such persons;

 
	
  

 	
  

 	
  

 
	
 4

 	
  

 	
 Certificate of incumbency

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 a list of directors and officers of each Security Party specifying
 the names and positions of such persons, certified (in a certificate dated no
 earlier than five (5) Banking Days prior to the date of this Agreement) by an
 officer of such Security Party to be true, complete and up to date;

 
	
  

 	
  

 	
  

 
	
 5

 	
  

 	
 Borrowers’ consents and approvals

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 a certificate (dated no earlier than five (5) Banking Days prior to
 the date of this Agreement) from an officer of each of the Borrowers that no
 consents, authorisations, licences or approvals are necessary for that
 Borrower to authorise or are required by that Borrower in connection with the
 borrowing by that Borrower of the Loan or any amounts under clause 2.7.1 or
 clause 2.7.3 or with any Bank Guarantee pursuant to this Agreement or the
 execution, delivery and performance of that Borrowers’ Security Documents;

 
	
  

 	
  

 	
  

 	
  

 
	
 6

 	
  

 	
 Other consents and approvals

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 a certificate (dated no earlier than five (5) Banking Days prior to
 the date of this Agreement) from an officer of each Security Party (other
 than the Borrowers) that no consents, authorisations, licences or

 

88

	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 approvals are necessary for such Security Party to guarantee and/or
 grant security for the borrowing by the Borrowers of the Total Commitment
 pursuant to this Agreement and execute, deliver and perform the Security
 Documents insofar as such Security Party is a party thereto;

 
	
  

 	
  

 	
  

 
	
 7

 	
  

 	
  “KYC”

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 such documentation and other evidence as is reasonably requested by
 the Agent, in order for each Creditor to carry out and be satisfied with the
 results of all necessary “know your client” or other checks which it is
 required to carry out in relation to the transactions contemplated by this
 Agreement and the other Security Documents and to the identity of any parties
 to the Security Documents (other than the Creditors) and their directors and
 officers;

 
	
  

 	
  

 	
  

 
	
 8

 	
  

 	
 Contracts and Charters; Standard Form

 
	
  

 
	
  

 	
  

 	
 (a)

 	
 a copy, certified (in a certificate dated no earlier than five (5)
 Banking Days prior to the date of this Agreement) as a true and complete copy
 by legal counsel to the Borrowers, of each of the Contracts and the Charters;
 and 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 the Standard Form has been submitted by the Borrowers to the Agent; 

 
	
  

 	
  

 	
  

 	
  

 
	
 9

 	
  

 	
 Charter terms

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 evidence that each Charter: 

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (a)

 	
 has a term a of at least ten (10) years from delivery of the relevant
 Ship to the Charterer under the relevant Charter; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 provides for a minimum net daily charterhire in the amount of not
 less than $40,000 per day payable throughout the charter term; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (c)

 	
 is governed by English law, subject to English arbitration and freely
 assignable to the Security Agent;

 
	
  

 	
  

 	
  

 	
  

 
	
 10

 	
  

 	
 Refund Guarantees

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 the original of the first Refund Guarantee in respect of each
 Contract, in respect of the “1st Instalment” payable thereunder (or, if sent
 by swift, each such first Refund Guarantee sent by swift to the Agent); 

 
	
  

 	
  

 	
  

 
	
 11

 	
  

 	
 Past instalments 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 evidence that the “1st Instalment” of the Contract Price of each Ship
 has been paid in full to the Seller (or will be paid in full on the same day
 as the Bank Guarantee Issue Date in respect of the Bank Guarantee for that
 Ship); 

 
	
  

 	
  

 	
  

 
	
 12

 	
  

 	
 Security Documents

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (a)

 	
 the Corporate Guarantee, the Fee Letters, the Pre-delivery Security
 Assignments, the Master Swap Agreement, the Swap Assignments, the Cash
 Collateral Account Assignment, the Operating Account Assignments, the Charter
 Assignments and the Trust Deed, each duly executed by the parties thereto; 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 the notices of assignment in respect of the first Refund Guarantees
 for each Contract, and the notices of assignment in respect of each Contract,
 each duly executed by the relevant Borrower in the forms prescribed by the
 Pre-delivery Security Assignments; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (c)

 	
 the notice of assignment of each Charter under each Charter
 Assignment, in the form prescribed thereunder, each duly executed by the
 relevant Borrower; 

 
	
  

 	
  

 	
  

 	
  

 
	
 13

 	
  

 	
 Accounts

 

89

	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 evidence that the Accounts have been opened and duly completed
 mandate forms in respect thereof have been delivered to the Agent;

 
	
  

 	
  

 	
  

 
	
 14

 	
  

 	
 Fees and commissions

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 evidence that any fees and commissions due under clause 5.1 have been
 paid in full; 

 
	
  

 	
  

 	
  

 
	
 15

 	
  

 	
 Financial statements

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 a certified true copy of the audited consolidated financial
 statements of the Corporate Guarantor for the financial year ended 31
 December 2009;

 
	
  

 	
  

 	
  

 
	
 16

 	
  

 	
 Borrowers’ process agent

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 a letter from each Borrower’s agent for receipt of service of
 proceedings referred to in clause 18.2 accepting its appointment under the
 said clause and under each of the other Security Documents in which it is or
 is to be appointed as such Borrower’s agent and referred to in this Part 1;

 
	
  

 	
  

 	
  

 
	
 17

 	
  

 	
 Security Parties’ process agent

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 a letter from each Security Party’s agent for receipt of service of
 proceedings referred to in each of the Security Documents to which such
 Security Party is a party and referred to in this Part 1 accepting its
 appointment under each such Security Document;

 
	
  

 	
  

 	
  

 
	
 18

 	
  

 	
 Liberian opinion

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 an opinion of Cozen O’Connor, legal advisers on matters of Liberian
 law to the Agent;

 
	
  

 	
  

 	
  

 
	
 19

 	
  

 	
 Chinese opinion

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 an opinion of King & Wood legal advisers on matters of Chinese
 law to the Agent; 

 
	
  

 	
  

 	
  

 
	
 20

 	
  

 	
 Marshall Islands opinion

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 an opinion of Cozen O’Connor, legal advisers on matters of Marshall
 Islands law to the Agent; and

 
	
  

 	
  

 	
  

 
	
 21

 	
  

 	
 Further conditions

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 any such further conditions, documents or opinions as may be
 reasonably required by the Agent.

 

90

Part 2

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1

 	
  

 	
 Bank Guarantee Request

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The Bank
 Guarantee Request in respect of the relevant Bank Guarantee duly executed;

 
	
  

 	
  

 	
  

 
	
 2

 	
  

 	
 No claim

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 if required by the Agent, a written statement from the Corporate
 Guarantor that the Seller (and any other party who may have a claim pursuant
 to the Contract to which such Bank Guarantee relates) has no claims against
 the relevant Borrower and that there have been no breaches of the terms of
 that Contract or any relevant Refund Guarantee or any default thereunder;

 
	
  

 	
  

 	
  

 
	
 3

 	
  

 	
 No variations to Contracts or Refund Guarantees

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 if required by the Agent, a written statement from the Borrowers that
 there have been no amendments or variations agreed to the Contract to which
 such Bank Guarantee relates or the relevant Refund Guarantee (except as may
 have already been advised by the Borrowers to the Agent in writing), and that
 no action has been taken by the Seller or the Refund Guarantor which will in
 any way render that Contract or any relevant Refund Guarantee inoperative or
 unenforceable, in whole or in part;

 
	
  

 	
  

 	
  

 
	
 4

 	
  

 	
 No Encumbrance

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 if required by the Agent, evidence that there is no Encumbrance of
 any kind created or permitted by any person on or relating to the Contract to
 which such Bank Guarantee relates or any relevant Refund Guarantee (other
 than Permitted Encumbrances); 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 5

 	
  

 	
 Fees and commissions

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 evidence
 that any fees and commissions due under clause 5.1 have been paid in full;
 and 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 6

 	
  

 	
 Further conditions

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 any such further
 conditions, documents or opinions as may be reasonably required by the Agent.

 
							

91

Part 3

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1

 	
  

 	
 Drawdown Notice

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The Drawdown Notice in respect of the relevant first, second or, as the case
 may be, third Contract Instalment Advance to be drawn down in respect of a Ship (for the purposes of this Part 3 only, the “Relevant
 Advance”), duly executed;

 
	
  

 	
  

 	
  

 
	
 2

 	
  

 	
 No claim

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 if required by the Agent, a written confirmation from the Corporate
 Guarantor that neither the Seller nor any other party who may have a claim
 pursuant to the Contract to which the Relevant Advance relates has any claims
 against the Ship or the Borrower relating to the Relevant Advance and that
 there have been no breaches of the terms of such Contract or any relevant
 Refund Guarantee or any default thereunder;

 
	
  

 	
  

 	
  

 
	
 3

 	
  

 	
 No variations to Contract or Refund Guarantee

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 if required by the Agent, a written statement from the Borrowers that
 there have been no material amendments or variations agreed to the Contract
 and no amendments or variations agreed to any Refund Guarantee (except as may
 have already been advised by the Borrowers to the Agent in writing) in
 respect of the Ship to which the Relevant Advance relates and that no action
 has been taken by the Seller or the Refund Guarantor which might in any way
 render the relevant Contract or any relevant Refund Guarantee inoperative or
 unenforceable, in whole or in part;

 
	
  

 	
  

 	
  

 
	
 4

 	
  

 	
 No encumbrance

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 if required by the Agent, evidence that there is no Encumbrance of
 any kind created or permitted by any person on or relating to the Contract or
 the Refund Guarantee in respect of the Ship to which any Relevant Advance
 relates other than Permitted Encumbrances;

 
	
  

 	
  

 	
  

 
	
 5

 	
  

 	
 Invoices 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 an invoice or notification from the Seller demanding the payment of
 the “2nd Instalment”, the “3rd Instalment” or, as the case may be, the “4th
 Instalment” payable under the Contract in respect of the Ship to which the
 Relevant Advance relates;

 
	
  

 	
  

 	
  

 
	
 6

 	
  

 	
 Refund Guarantee matters

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (a)

 	
 the original of the Refund Guarantee in respect of all of the
 pre-delivery instalments (except the “1st Instalment”) of the Contract Price
 for the Ship to which the relevant Advance relates (or, if sent by swift,
 such Refund Guarantee sent by swift to the Agent); and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 the notice of assignment in respect of such Refund Guarantee, duly
 executed by the relevant Borrower in the form prescribed in the relevant
 Pre-delivery Security Assignment;

 

92

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7

 	
  

 	
 Class confirmation

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 evidence
 from the Classification Society that:

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (a)

 	
 the cutting of the first steel plate of the Ship to which the
 Relevant Advance relates has been completed at the Builder’s workshop (in the
 event that the Relevant Advance is the first Contract Instalment Advance for
 that Ship); or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 the first section of keel of the Ship to which the Relevant Advance
 relates has been laid at the Builder’s drydock (in the event that the
 Relevant Advance is the second Contract Instalment Advance for that Ship); or
 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (c)

 	
 the launching of the Ship to which the Relevant Advance relates has
 been completed at the Builder’s drydock (in the event that the Relevant
 Advance is the third Contract Instalment Advance for that Ship);

 
	
  

 	
  

 	
  

 	
  

 
	
 8

 	
  

 	
 Equity

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 evidence that any part of the relevant instalment of the Contract
 Price payable to the Seller in respect of that Ship, which is not being
 funded by the Relevant Advance pursuant to this Agreement has been deposited
 (not later than three (3) Banking Days before the proposed Drawdown Date of
 the Relevant Advance) with the Agent for further payment to the Seller; and 

 
	
  

 	
  

 	
  

 
	
 9

 	
  

 	
 Further conditions

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 any such
 further conditions, documents or evidence as may be reasonably required by
 the Agent.

 

93

Part 4

	
  

 	
  

 	
  

 	
  

 
	
 1

 	
  

 	
 Drawdown Notice

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 The Drawdown Notice in respect of the relevant Delivery Advance (for
 the purposes of this Part 4 only, the “Relevant
 Advance”), duly executed;

 
	
  

 	
  

 	
  

 
	
 2

 	
  

 	
 Updated corporate authorisations/certificates of incumbency

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 a list of directors and officers of each Security Party specifying
 the names and positions of such persons and copies of the signatures of the
 persons who have been authorised on behalf of each Security Party to sign
 such of the Security Documents to which such Security Party is, or is to be,
 party and referred to in this Part 3 in respect of the Relevant Advance, and
 to give notices and communications, including notices of drawing, under or in
 connection with the Security Documents, certified by legal counsel of such
 Security Party to be, in the case of the list of directors, true, complete
 and up to date and, in the case of the specimen signatures, true signatures
 of such persons or a certificate by an officer of such Security Party that
 the list provided in respect of that Security Party pursuant to
 paragraph 4 of Part 1 of this schedule and that the specimen
 signatures provided in respect of the Security Party pursuant to
 paragraph 3 of Part 1 of this schedule remain true, complete and up
 to date;

 
	
  

 	
  

 	
  

 
	
 3

 	
  

 	
 Constitutional documents

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 copies, certified by legal counsel of the relevant Manager(s) of the
 Ship to which the Relevant Advance relates, as true, complete and up to date
 copies of all documents which contain or establish or relate to the constitution
 of each such Manager;

 
	
  

 	
  

 	
  

 
	
 4

 	
  

 	
 Corporate authorisations

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 copies of resolutions of the directors and also (but only if required
 by law in the opinion of the Agent’s legal counsel on matters of laws of the
 country of incorporation of the relevant Manager) of the stockholders of the
 relevant Manager(s) of the Ship to which the Relevant Advance relates,
 approving such of the Underlying Documents and any Manager’s Undertakings in
 respect of that Ship to which each such Manager is, or is to be, a party and
 authorising the signature, delivery and performance of each such Manager’s
 obligations thereunder, certified by legal counsel of each Manager as:

 
	
  

 	
  

 	
  

 
	
 4.1

 	
  

 	
 being true and correct;

 
	
  

 	
  

 	
  

 	
  

 
	
 4.2

 	
  

 	
 being duly passed at meetings of the directors of that Manager and,
 if applicable, of the stockholders of that Manager, each duly convened and
 held;

 
	
  

 	
  

 	
  

 
	
 4.3

 	
  

 	
 not having been amended, modified or revoked; and

 
	
  

 	
  

 	
  

 
	
 4.4

 	
  

 	
 being in full force and effect,

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 together with originals or certified copies of any powers of attorney
 issued by that Manager pursuant to such resolutions;

 
	
  

 	
  

 	
  

 
	
 5

 	
  

 	
 Certificate of incumbency

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 a list of directors and officers of the relevant Manager(s) of the
 Ship to which the Relevant Advance relates specifying the names and positions
 of such persons, certified by an officer of each such Manager to be true,
 complete and up to date;

 
	
  

 	
  

 	
  

 
	
 6

 	
  

 	
 Consents and approvals

 
	
  

 	
  

 	
  

 

94

	
  

 	
  

 	
  

 
	
  

 	
  

 	
 a certificate from an officer of the relevant Manager(s) of the Ship
 to which the Relevant Advance relates that no consents, authorisations,
 licences or approvals are necessary for each such Manager to execute, deliver
 and perform any Manager’s Undertaking in respect of that Ship to which it is
 a party;

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
 7

 	
  

 	
 Ship conditions

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 evidence that the Ship to which the Relevant Advance relates:

 
	
  

 	
  

 	
  

 	
  

 
	
 7.1

 	
  

 	
 Registration and Encumbrances

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 is registered in the name of the relevant Borrower through the
 relevant Registry under the laws and flag of the relevant Flag State and that
 such Ship and its Earnings, Insurances and Requisition Compensation are free
 of Encumbrances; and

 
	
  

 	
  

 	
  

 
	
 7.2

 	
  

 	
 Classification

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 maintains the relevant Classification free of all overdue
 requirements and recommendations of the relevant Classification Society; and 

 
	
  

 	
  

 	
  

 
	
 7.3

 	
  

 	
 Insurance

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 is insured in accordance with the provisions of the relevant Ship
 Security Documents and all requirements of the Security Documents in respect
 of such insurance have been complied with (including without limitation,
 confirmation from the protection and indemnity association or other insurer
 with which such Ship is, or is to be, entered for insurance or insured
 against protection and indemnity risks (including oil pollution risks) that
 any necessary declarations required by the association or insurer for the
 removal of any oil pollution exclusion have been made and that any such
 exclusion does not apply to such Ship); and

 
	
  

 	
  

 	
  

 
	
 7.4

 	
  

 	
 Delivery under Charter

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 has been delivered to the Charterer for service under the relevant
 Charter (such evidence, if not practicable to be provided by the Charterer,
 to be in the form of a written confirmation by the Borrowers);

 
	
  

 	
  

 	
  

 
	
 8

 	
  

 	
 Title and no Encumbrances

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 evidence that the transfer of title to the Ship to which the Relevant
 Advance relates from the Seller to the relevant Borrower has been duly
 recorded with the relevant Registry free from Encumbrances other than
 Permitted Encumbrances; 

 
	
  

 	
  

 	
  

 
	
 9

 	
  

 	
 Fees and commissions

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 payment of any fees and commissions due from the Borrowers to any of
 the Creditors pursuant to the terms of clause 5.1 or any other provision
 of the Security Documents;

 
	
  

 	
  

 	
  

 
	
 10

 	
  

 	
 Delivery documents

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (a)

 	
 a commercial invoice or any other similar document issued by the
 Seller to the relevant Borrower in respect of the amount of the Contract Price
 in respect of the Ship to which the Relevant Advance relates, evidencing the
 payment in full of such Contract Price; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 copies of all the delivery documents to be exchanged between the
 Seller and the relevant Borrower under the relevant Contract on Delivery of
 such Ship, including, without limitation, the bill of sale, the builder’s
 certificate, the protocol of delivery and acceptance and the declaration of
 warranty;

 
	
  

 	
  

 	
  

 
	
 11

 	
  

 	
 Class confirmation

 
						

95

 

	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 evidence from the relevant Classification Society that the Ship to
 which the Relevant Advance relates has been completed to its satisfaction;

 
	
  

 	
  

 	
  

 
	
 12

 	
  

 	
 Security Documents

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 the Mortgage, the Deed of Covenant and the Manager’s Undertaking(s)
 in respect of the Ship to which the Relevant Advance relates, each duly
 executed and delivered;

 
	
  

 	
  

 	
  

 
	
 13

 	
  

 	
 Mortgage registration

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 evidence that the Mortgage in respect of the Ship to which the
 Relevant Advance relates has been registered against such Ship through the
 relevant Registry under the laws and flag of the relevant Flag State;

 
	
  

 	
  

 	
  

 
	
 14

 	
  

 	
 Notices of assignment

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 duly executed notices of assignment in the forms prescribed by the
 Ship Security Documents for the Ship to which the Relevant Advance relates;

 
	
  

 	
  

 	
  

 
	
 15

 	
  

 	
 Insurance opinion

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 an opinion from insurance consultants to the Agent in form and
 substance satisfactory to the Agent and made at the cost and expense of the
 Borrowers, on the insurances effected or to be effected in respect of the
 Ship to which the Relevant Advance relates, upon and following the Delivery
 Date of such Ship;

 
	
  

 	
  

 	
  

 
	
 16

 	
  

 	
 Borrowers’ process agent

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 a letter from the relevant Borrower’s agent for receipt of service of
 proceedings referred to in each of the relevant Mortgage and/or the Deed of
 Covenant for the Ship to which the Relevant Advance relates and in which it
 is or is to be appointed as that Borrower’s agent accepting its appointment
 under each such document;

 
	
  

 	
  

 	
  

 
	
 17

 	
  

 	
 Security Parties’ process agent

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 a letter from each Security Party’s and each Manager’s agent for
 receipt of service of proceedings referred to in each Security Document and
 Manager’s Undertaking to which the relevant Security Party and relevant
 Manager is a party and which is referred to in this Part 3 in respect of the
 Relevant Advance, accepting its appointment under each of the relevant
 Security Documents and the relevant Manager’s Undertaking(s);

 
	
  

 	
  

 	
  

 
	
 18

 	
  

 	
 Management Agreement

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 a copy, certified as a true and complete copy by an officer of the
 relevant Borrower, of each Management Agreement for the Ship to which the
 Relevant Advance relates;

 
	
  

 	
  

 	
  

 
	
 19

 	
  

 	
 DOC and application for SMC

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 a certified copy of the DOC and either (i) a certified copy of the
 SMC for the Ship to which the Relevant Advance relates or (ii) evidence
 satisfactory to the Agent that the Operator has applied for an SMC for such
 Ship;

 
	
  

 	
  

 	
  

 
	
 20

 	
  

 	
 ISPS Code compliance

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (a)

 	
 evidence satisfactory to the Agent that the Ship to which the
 Relevant Advance relates is subject to a ship security plan which complies
 with the ISPS Code; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 a copy, certified (in a certificate dated no earlier than five (5)
 Banking Days prior to the Delivery Date of such Ship) as a true and complete
 copy by an officer of the relevant Borrower of the ISSC for such Ship;

 

96

	
  

 	
  

 	
  

 	
  

 
	
 21

 	
  

 	
 Liberian opinion

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 an opinion of Cozen O’Connor, legal advisers on matters of Liberian
 law to the Agent;

 
	
  

 	
  

 	
  

 
	
 22

 	
  

 	
 Manager’s opinion

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 an opinion of legal advisers to the Agent on matters of the laws of
 the jurisdiction of incorporation of the relevant Manager(s) for the Ship to
 which the relevant Advance relates; 

 
	
  

 	
  

 	
  

 	
  

 
	
 23

 	
  

 	
 Flag State opinion

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 an opinion of legal advisers to the Agent on matters of the laws of
 the Flag State for the Ship to which the Relevant Advance relates; and

 
	
  

 	
  

 	
  

 	
  

 
	
 24

 	
  

 	
 Further conditions

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 any such other conditions, documents or evidence as may be reasonably
 required by the Agent.

 

97

Schedule 4

Form of Transfer Certificate

(refer to in clause 15.3)

TRANSFER
CERTIFICATE

Banks are advised not to employ Transfer
Certificates or otherwise to assign or transfer interests in the Facility
Agreement without further ensuring that the transaction complies with all
applicable laws and regulations, including the Financial Services and Markets
Act 2000 and regulations made thereunder and similar statutes which may be in
force in other jurisdictions

	
  

 	
  

 
	
 To:

 	
 DNB NOR BANK ASA as agent on its own behalf and
 on behalf of the Borrowers, the Banks, the Account Bank, the Security Agent,
 the Issuing Bank, the Swap Provider and the Arrangers defined in the Facility
 Agreement referred to below.

 

	
  

 	
  

 
	
 
Attention:     [Ÿ]

 	
 [Date]

 

This certificate (“Transfer Certificate”) relates to a
facility agreement dated 14 January 2011 (the “Facility Agreement”) and made
between (1) Adele Shipping Co., Bastian Shipping Co. and Cadence Shipping Co.
(the “Borrowers”),
(2) the banks and financial institutions referred to therein as lenders (the “Banks”),
(3) The Export-Import Bank of China and DnB NOR Bank ASA as Arrangers, (4) DnB
NOR Bank ASA as Agent, Security Agent and Account Bank, (5) The Export-Import
Bank of China as Issuing Bank and (6) DnB NOR Bank ASA as Swap Provider, in
relation to a loan facility of up to Two hundred and three million three
hundred and forty three thousand Dollars ($203,343,000) and a guarantee
facility of up to Twenty eight million eight hundred and fifty six thousand
seven hundred and eighty one Dollars ($28,856,781). Terms defined in the
Facility Agreement shall, unless otherwise defined herein, have the same
meanings herein as therein.

In this Certificate:

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

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

	
  

 	
  

 
	
 1

 	
 The Transferor with full title guarantee assigns to the Transferee
 absolutely all rights and interests (present, future or contingent) which the
 Transferor has as a Bank under or by virtue of the Facility Agreement and all
 the Security Documents in relation to [ ] per centum ([ ]%) of the
 [Contribution] [Commitment] [participation in the Guarantee Facility] of the
 Transferor (or its predecessors in title), details of which are set out
 below:

 

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Date of Advance[s]

 	
  

 	
 Amount of Advance[s]

 	
  

 	
 Transferor’s [Contribution] [Commitment]
to Advance[s]

 	
  

 	
 Transferor’s participation in
Guarantee Facility
(Percentage)

 	
  

 	
 Maturity Date

 
	
  

 	

 

 

 	
  

 	

 

 

 	
  

 	

 

 

 	
  

 	

 

 

 	
  

 	

 

 

 

	
  

 	
  

 
	
 2

 	
 By virtue of this Transfer
 Certificate and clause 15 of the Facility Agreement, the Transferor is
 discharged [entirely from its [Contribution] [Commitment] [participation in
 the Guarantee Facility], which amounts to
 $[        ]] [from
 [     ] per centum ([     ]%)
 of its [Contribution] [Commitment] [Percentage], which percentage represents
 $[        ]].

 

98

	
  

 	
  

 	
  

 
	
 3

 	
  

 	
 The Transferee hereby requests
 the Agent (on behalf of itself, the Borrowers, the Account Bank, the Security
 Agent, the Arrangers, the Issuing Bank, the Swap Provider and the Banks) to
 accept the executed copies of this Transfer Certificate as being delivered
 pursuant to and for the purposes of clause 15.3 of the Facility
 Agreement so as to take effect in accordance with the terms thereof on [date of
 transfer].

 
	
  

 	
  

 	
  

 
	
 4

 	
  

 	
 The Transferee:

 
	
  

 	
  

 	
  

 
	
 4.1

 	
  

 	
 confirms that it has received a
 copy of the Facility Agreement and the other Security Documents together with
 such other documents and information as it has required in connection with
 the transaction contemplated thereby;

 
	
  

 	
  

 	
  

 
	
 4.2

 	
  

 	
 confirms that it has not relied
 and will not hereafter rely on the Transferor, the Agent, the Account Bank,
 the Arrangers, the Banks, the Issuing Bank, the Swap Provider or the Security
 Agent to check or enquire on its behalf into the legality, validity,
 effectiveness, adequacy, accuracy or completeness of the Facility Agreement,
 any of the Security Documents or any such documents or information;

 
	
  

 	
  

 	
  

 
	
 4.3

 	
  

 	
 agrees that it has not relied
 and will not rely on the Transferor, the Agent, the Account Bank, the
 Arrangers, the Banks, the Issuing Bank, the Swap Provider or the Security
 Agent to assess or keep under review on its behalf the financial condition,
 creditworthiness, condition, affairs, status or nature of the Borrowers, or
 any other Security Party (save as otherwise expressly provided therein);

 
	
  

 	
  

 	
  

 
	
 4.4

 	
  

 	
 warrants that it has power and
 authority to become a party to the Facility Agreement and has taken all
 necessary action to authorise execution of this Transfer Certificate and to
 obtain all necessary approvals and consents to the assumption of its
 obligations under the Facility Agreement and the Security Documents; and

 
	
  

 	
  

 	
  

 
	
 4.5

 	
  

 	
 if not already a Bank, appoints
 (i) the Agent to act as its agent and (ii) the Security Agent to act as its
 security agent and trustee, as provided in the Facility Agreement and the
 Security Documents and agrees to be bound by the terms of the Facility
 Agreement and the Security Documents.

 
	
  

 	
  

 	
  

 
	
 5

 	
  

 	
 The Transferor:

 
	
  

 	
  

 	
  

 
	
 5.1

 	
  

 	
 warrants to the Transferee that
 it has full power to enter into this Transfer Certificate and has taken all
 corporate action necessary to authorise it to do so;

 
	
  

 	
  

 	
  

 
	
 5.2

 	
  

 	
 warrants to the Transferee that
 this Transfer Certificate is binding on the Transferor under the laws of
 England, the country in which the Transferor is incorporated and the country
 in which its lending office is located; and

 
	
  

 	
  

 	
  

 
	
 5.3

 	
  

 	
 agrees that it 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
 Transfer Certificate or for a similar purpose.

 
	
  

 	
  

 	
  

 
	
 6

 	
  

 	
 The Transferee hereby
 undertakes with the Transferor and each of the other parties to the Facility
 Agreement and the other Security Documents that it will perform in accordance
 with its terms all those obligations which by the terms of the Facility
 Agreement and the other Security Documents will be assumed by it after
 delivery of the executed copies of this Transfer Certificate to the Agent and
 satisfaction of the conditions (if any) subject to which this Transfer
 Certificate is expressed to take effect.

 
	
  

 	
  

 	
  

 
	
 7

 	
  

 	
 By execution of this Transfer
 Certificate on their behalf by the Agent and in reliance upon the
 representations and warranties of the Transferee, the Borrowers, the Agent,
 the Security Agent, the Arrangers, the Account Bank, the Issuing Bank, the
 Swap Provider and the Banks accept the Transferee as a party to the Facility
 Agreement and the Security Documents with respect to all those rights and/or
 obligations which by the terms of the Facility Agreement and the Security
 Documents will be assumed by the Transferee (including those about pro-rata
 sharing and the exclusion of liability on the part of, and the
 indemnification of, the Agent, the Account Bank, the Arrangers, the Issuing
 Bank, the Swap Provider and the Security Agent as provided by the Facility
 Agreement) after delivery of the executed copies of this Transfer Certificate
 to the Agent and satisfaction of the conditions (if any) subject to which
 this Transfer Certificate is expressed to take effect.

 

99

	
  

 	
  

 	
  

 
	
 8

 	
  

 	
 None of the Transferor, the
 Agent, the Security Agent, the Account Bank, the Arrangers, the Issuing Bank,
 the Swap Provider or the Banks:

 
	
  

 	
  

 	
  

 
	
 8.1

 	
  

 	
 makes any representation or
 warranty nor assumes any responsibility with respect to the legality,
 validity, effectiveness, adequacy or enforceability of the Facility Agreement
 or any of the Security Documents or any document relating thereto; or

 
	
  

 	
  

 	
  

 
	
 8.2

 	
  

 	
 assumes any responsibility for
 the financial condition of the Borrowers or any of them or any other Security
 Party or any party to any such other document or for the performance and
 observance by the Borrowers or any of them or any other Security Party or any
 party to any such other document (save as otherwise expressly provided
 therein) and any and all such conditions and warranties, whether express or
 implied by law or otherwise, are hereby excluded (except as aforesaid).

 
	
  

 	
  

 	
  

 
	
 9

 	
  

 	
 The Transferor and the
 Transferee each undertake that they will on demand fully indemnify the Agent
 in respect of any claim, proceeding, liability or expense which relates to or
 results from this Transfer Certificate or any matter concerned with or
 arising out of it unless caused by the Agent’s gross negligence or wilful
 misconduct, as the case may be.

 
	
  

 	
  

 	
  

 
	
 10

 	
  

 	
 The agreements and undertakings
 of the Transferee in this Transfer Certificate are given to and for the
 benefit of and made with each of the other parties to the Facility Agreement
 and the Security Documents.

 
	
  

 	
  

 	
  

 
	
 11

 	
  

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

 

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Transferor

 	
  

 	
 Transferee

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  

 	
  

 	
 By:

 	
  

 
	
  

 	
  

 	

 

 	
  

 	
  

 	

 

 

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Dated:

 	
  

 	
  

 	
 Dated:

 	
  

 
	
  

 	
  

 	

 

 	
  

 	
  

 	

 

 

Agent

Agreed for and
on behalf of itself as Agent, the Borrowers, the Security Agent, the Account
Bank, the Issuing Bank, the Swap Provider, the Arrangers and the Banks.

DNB NOR BANK ASA

	
  

 	
  

 
	
 By:

 	
  

 
	
  

 	

 

 

	
  

 	
  

 
	
 Dated:

 	
  

 
	
  

 	

 

 

Note:
The execution of this Transfer Certificate alone may not transfer a
proportionate share of the Transferor’s interest in the security constituted by
the Security Documents in the Transferor’s or Transferee’s jurisdiction. It is
the responsibility of the Transferee to ascertain whether any other documents
are required to perfect a transfer of such a share in the Transferor’s interest
in such security in any such jurisdiction and, if so, to seek appropriate
advice and arrange for execution of the same.

100

The Schedule

Outstanding
Contribution: $[Ÿ] 

Portion Transferred: [Ÿ]% 

Commitment: $[Ÿ] 

Portion Transferred: [Ÿ]% 

Percentage of
Transferor immediately before transfers: [Ÿ]% 

Percentage of Transferee following transfers: [Ÿ]% 

Administrative Details of Transferee 

Name of
Transferee:

Lending Office:

Contact
Person: 

(Loan Administration Department) 

Telephone:

Telefax No: 

Contact
Person: 

(Credit Administration Department)

Telephone:

Telefax No: 

[Account for
payments:] 

101

Schedule 5

Contract Instalment Advances per Ship 

	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Contract Instalment

 Advances per Ship

 	
  

 	
 Amount per Ship

 ($)

 	
  

 	
 Time when relevant Contract instalment 

 payable (per Ship)

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 first
 Contract

 Instalment Advance

 	
  

 	
 10,733,000

 	
  

 	
 Later of (a)
 Specified Date and (b) 5 New York business days from cutting of the first steel
 plate of the relevant Ship at the Builder’s workshop

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 second
 Contract

 Instalment Advance

 	
  

 	
 19,016,000

 	
  

 	
 Later of (a)
 Specified Date and (b) 5 New York business days from keel-laying of the first
 section of the relevant Ship at the Builder’s drydock

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 third
 Contract

 Instalment Advance

 	
  

 	
 19,016,000

 	
  

 	
 Later of (a)
 Specified Date and (b) 5 New York business days after launching of the relevant
 Ship at the Builder’s drydock

 

“New York
business day” for the purposes of this schedule 5 shall have the meaning given
to it in the Contracts.  

“Specified
Date” for the purposes of this schedule 5 means, in relation to each instalment
of the Contract Price of a Ship referred to in the above table, the fixed date
specified in paragraph (c), (d) or (e) (as the case may be) of Article II(3) of
the Contract for that Ship as the earliest due date of that instalment.  

102

Schedule 6

Form of Trust Deed

THIS
DECLARATION OF TRUST by DNB NOR
BANK ASA (the “Security Agent”) is made on [Ÿ] 2011 and is
supplemental to (and made pursuant to the terms of) a Facility Agreement dated
14 January 2011 (the “Agreement”) and made between (1) Adele
Shipping Co., Bastian Shipping Co. and Cadence Shipping Co. as joint and
several Borrowers, (2) The Export-Import Bank of China and DnB NOR Bank ASA as
Arrangers, (3) DnB NOR Bank ASA as Agent, (4) The Export-Import Bank of China
as Issuing Bank, (5) the Security Agent, (6) DnB NOR Bank ASA as Swap Provider
and Account Bank and (7) the banks and financial institutions mentioned in
schedule 1 to the Agreement as the Banks. Words and expressions defined in
the Agreement shall have the same meanings when used in this Deed.

NOW
THIS DEED WITNESSETH as follows:

	
  

 	
  

 
	
 1

 	
 The Security Agent hereby acknowledges and declares that, from the
 date of this Deed, it holds and shall hold the Trust Property on trust for
 certain of the other Creditors on the terms and basis set out in the
 Agreement.

 
	
  

 	
  

 
	
 2

 	
 The
 declaration and acknowledgement contained in paragraph 1 above shall be
 irrevocable.

 

	
  

 	
  

 	
  

 	
  

 	
  

 
	
 EXECUTED as a DEED

 	
 )

 	
  

 	
  

 
	
 by

 	
 )

 	
  

 	
  

 
	
 for and on
 behalf of

 	
 )

 	
  

 	

 

 	
  

 
	
 DNB NOR BANK ASA

 	
 )

 	
  

 	
 Attorney-in-fact

 
	
 (as Security
 Agent)

 	
 )

 	
  

 	
  

 
	
 in the
 presence of:

 	
 )

 	
  

 	
  

 

103

Schedule
7

Form of Bank Guarantee

104

Form
of Adele Bank Guarantee

105

Form
of Bastian Bank Guarantee

106

Form
of Cadence Bank Guarantee

107

Schedule
8

Mandatory Cost formula

	
  

 	
  

 
	
 1

 	
 The Mandatory Cost is an addition to the interest rate to compensate
 Banks for the cost of compliance with (a) the requirements of the Bank of
 England and/or the Financial Services Authority (or, in either case, any
 other authority which replaces all or any of its functions) or (b) the
 requirements of the European Central Bank.

 
	
  

 	
  

 
	
 2

 	
 On the first day of each Interest Period (or as soon as possible
 thereafter) the Agent shall calculate, as a percentage rate, a rate (the “Additional
 Cost Rate”) for each Bank, in accordance with the paragraphs set
 out below. The Mandatory Cost will be calculated by the Agent as a weighted
 average of the Banks’ Additional Cost Rates (weighted in proportion to the
 percentage participation of each Bank in the Loan or any relevant unpaid sum)
 and will be expressed as a percentage rate per annum.

 
	
  

 	
  

 
	
 3

 	
 The Additional Cost Rate for any Bank lending from a lending office
 in a Participating Member State will be the percentage notified by that Bank
 to the Agent. This percentage will be certified by that Bank in its notice to
 the Agent to be its reasonable determination of the cost (expressed as a
 percentage of that Bank’s participation in the Loan or the relevant unpaid
 sum made from that lending office) of complying with the minimum reserve
 requirements of the European Central Bank in respect of loans made from that
 lending office.

 
	
  

 	
  

 
	
 4

 	
 The
 Additional Cost Rate for any Bank lending from a lending office in the United
 Kingdom will be calculated by the Agent as follows:

 

	
  

 	
  

 	
  

 
	
  

 	
 E × 0.01

 	
  

 
	
  

 	

 

 	
   per
 cent per annum.

 
	
  

 	
 300

 	
  

 

	
  

 	
  

 	
  

 
	
  

 	
 Where E is designed to compensate Banks for amounts payable
 under the Fees Rules and is calculated by the Agent as being the most recent
 rate of charge supplied by the Reference Bank to the Agent pursuant to
 paragraph 6 below and expressed in pounds per £1,000,000.

 
	
  

 	
  

 
	
 5

 	
 For the purposes of this Schedule:

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 “Fees Rules” means the rules on periodic fees contained in
 the Financial Services Authority Fees Manual or such other law or regulation
 as may be in force from time to time in respect of the payment of fees for
 the acceptance of deposits; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 “Fee Tariffs” means the fee tariffs specified in the Fees
 Rules under Column 1 of the activity group A.1 Deposit acceptors (ignoring
 any minimum fee or zero rated fee required pursuant to the Fees Rules but
 taking into account any applicable discount rate);

 
	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 “Participating Member State” means any member of the European
 Union that adopts or has adopted the euro as its lawful currency in
 accordance with the legislation of the European Community relating to the
 Economic and Monetary Union;

 
	
  

 	
  

 	
  

 
	
  

 	
 (d)

 	
 “Special Deposits” has the meaning given to it from time to
 time under or pursuant to the Bank of England Act 1998 or (as may be
 appropriate) by the Bank of England; and

 
	
  

 	
  

 	
  

 
	
  

 	
 (e)

 	
 “Tariff Base” has the meaning given to it in, and will be
 calculated in accordance with, the Fees Rules.

 
	
  

 	
  

 
	
 6

 	
 If requested by the Agent, the Reference Bank shall, as soon as
 practicable after publication by the Financial Services Authority, supply to
 the Agent, the rate of charge payable by the Reference Bank to the Financial
 Services Authority pursuant to the Fees Rules in respect of the relevant
 financial year of the Financial Services Authority (calculated for this
 purpose by the Reference Bank as being the

 
				

108

	
  

 	
  

 	
  

 
	
  

 	
 average of the Fee Tariffs applicable to the Reference Bank for that
 financial year) and expressed in pounds per £1,000,000 of the Tariff Base of
 the Reference Bank.

 
	
  

 	
  

 
	
 7

 	
 Each Bank shall supply any information required by the Agent for the
 purpose of calculating its Additional Cost Rate. In particular, but without
 limitation, each Bank shall supply the following information on or prior to
 the date on which it becomes a Bank:

 
	
  

 	
  

 
	
  

 	
 (a)

 	
 the jurisdiction of its lending office; and

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 any other information that the Agent may reasonably require for such
 purpose.

 
	
  

 	
  

 	
  

 
	
  

 	
 Each Bank shall promptly notify the Agent of any change to the
 information provided by it pursuant to this paragraph. 

 
	
  

 	
  

 	
  

 
	
 8

 	
 The rates of charge of the Reference Bank for the purpose of E
 above shall be determined by the Agent based upon the information supplied to
 it pursuant to paragraphs 6 and 7 above and on the assumption that, unless a
 Bank notifies the Agent to the contrary, each Bank’s obligations in relation
 to cash ratio deposits and Special Deposits are the same as those of a
 typical bank from its jurisdiction of incorporation with a lending office in
 the same jurisdiction as its lending office.

 
	
  

 	
  

 	
  

 
	
 9

 	
 The Agent shall have no liability to any person if such determination
 results in an Additional Cost Rate which over or under compensates any Bank
 and shall be entitled to assume that the information provided by any Bank or
 the Reference Bank pursuant to paragraphs 3, 6 and 7 above is true and
 correct in all respects. 

 
	
  

 	
  

 	
  

 
	
 10

 	
 The Agent shall distribute the additional amounts received as a
 result of the Mandatory Cost to the Banks on the basis of the Additional Cost
 Rate for each Bank based on the information provided by each Bank and the
 Reference Bank pursuant to paragraphs 3, 6 and 7 above.

 
	
  

 	
  

 	
  

 
	
 11

 	
 Any determination by the Agent pursuant to this schedule in relation
 to a formula, the Mandatory Cost, an Additional Cost Rate or any amount
 payable to a Bank shall, in the absence of manifest error, be conclusive and
 binding on all parties to this Agreement.

 
	
  

 	
  

 	
  

 
	
 12

 	
 The Agent may from time to time, after consultation with the
 Borrowers and the Banks, determine and notify to all parties to this
 Agreement any amendments which are required to be made to this schedule in
 order to comply with any change in law, regulation or any requirements from
 time to time imposed by the Bank of England, the Financial Services Authority
 or the European Central Bank (or, in any case, any other authority which
 replaces all or any of its functions) and any such determination shall, in
 the absence of manifest error, be conclusive and binding on all parties to
 this Agreement.

 

109

	
  

 	
  

 	
  

 	
  

 
	
 BORROWERS

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
 SIGNED by

 	
 )

 	
  

 	
  

 
	
 for and on
 behalf of

 	
 )

 	
  

 	

 

 
	
 ADELE SHIPPING CO.

 	
 )

 	
  

 	
 Attorney-in-fact

 
	
 as Borrower 

 	
 )

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
 SIGNED by 

 	
 )

 	
  

 	
  

 
	
 for and on
 behalf of 

 	
 )

 	
  

 	

 

 
	
 BASTIAN SHIPPING CO.
 

 	
 )

 	
  

 	
 Attorney-in-fact

 
	
 as Borrower 

 	
 )

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
 SIGNED by 

 	
 )

 	
  

 	
  

 
	
 for and on
 behalf of 

 	
 )

 	
  

 	

 

 
	
 CADENCE SHIPPING CO.
 

 	
 )

 	
  

 	
 Attorney-in-fact

 
	
 as Borrower 

 	
 )

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
 CREDITORS

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
 SIGNED by 

 	
 )

 	
  

 	

 

 
	
 and by 

 	
 )

 	
  

 	
 Authorised
 signatory

 
	
 for and on
 behalf of 

 	
 )

 	
  

 	
  

 
	
 DNB NOR BANK ASA
 

 	
 )

 	
  

 	

 

 
	
 as Agent,
 Arranger, Account Bank, Security Agent and Bank 

 	
 )

 	
  

 	
 Authorised
 signatory 

 
	
  

 	
  

 	
  

 	
  

 
	
 SIGNED by 

 	
 )

 	
  

 	
  

 
	
 for and on
 behalf of 

 	
 )

 	
  

 	

 

 
	
 THE
 EXPORT-IMPORT BANK OF CHINA

 	
 )

 	
  

 	
 Attorney-in-fact

 
	
 as Arranger,
 Issuing Bank and Bank 

 	
 )

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
 SIGNED by 

 	
 )

 	
  

 	

 

 
	
 and by 

 	
 )

 	
  

 	
 Authorised
 signatory

 
	
 for and on
 behalf of 

 	
 )

 	
  

 	
  

 
	
 CHINA EVERBRIGHT BANK
 

 	
 )

 	
  

 	

 

 
	
 as Bank 

 	
 )

 	
  

 	
 Authorised
 signatory

 
	
  

 	
  

 	
  

 	
  

 
	
 SIGNED by 

 	
 )

 	
  

 	
  

 
	
 for and on
 behalf of 

 	
 )

 	
  

 	

 

 
	
 DNB NOR BANK ASA
 

 	
 )

 	
  

 	
 Attorney-in-fact
 

 
	
 as Swap
 Provider 

 	
 )

 	
  

 	
  

 

110ex10-1.htm

 

THIS AGREEMENT, dated as of March 16, 2011 (this "Agreement"), between Sun Bancorp, Inc., a New Jersey corporation (the "Company"), and a fund managed by Anchorage Capital Group LLC, a Delaware limited liability company, acting on behalf of a yet-to-be-designated investment fund that it advises (the "Investor").

 

INTRODUCTION

 

The Company is currently undertaking a firm commitment underwritten public offering (the “Current Offering”) of its common stock, par value $1.00 per share (“Common Stock”).  The Company intends to direct the underwriters to sell to the Investor, and the Investor intends to purchase from the underwriters, as an investment in the Company, 7,463,716 shares of Common Stock in the public offering and at the public offering price as described in the Prospectus and the Preliminary Prospectus Supplement dated March 14, 2011, of the Company and any Free Writing Prospectus of the Company, receipt of which the Investor hereby acknowledges.  In connection with its prospective purchase of Common Stock, the Investor has requested certain “gross-up” rights from the Company in connection with certain future offerings of Company securities, and the Company has agreed to grant such rights.

 

NOW, THEREFORE, in consideration of the premises, and of the representations, warranties, covenants and agreements set forth herein, the parties, intending to be legally bound,  agree as follows:

 

ARTICLE I

 

Gross-Up Rights

 

1.1           Gross-Up Rights.  (a)  For so long as the Investor beneficially owns, together with its Affiliates, at least 6.0% of the outstanding shares of Common Stock of the Company at any time after the date hereof, then if the Company makes any public or nonpublic offering or sale of any equity security (including Common Stock, preferred stock or restricted stock), or any securities, options or debt that is convertible or exchangeable into equity or that includes an equity component (such as, an "equity kicker") (including any hybrid security) (any such security, a "New Security") (other than (i) any Common Stock or other securities (1) issuable upon the exercise or conversion of any securities of the Company issued or agreed to be issued as of the date hereof (2) issuable pursuant to the transactions contemplated by this Agreement; (ii) pursuant to the granting or exercise of employee stock options or other stock incentives pursuant to the Company's stock incentive plans approved by the Board of Directors, either before or after the date of this Agreement, or the issuance of stock pursuant to the Company's employee stock purchase plan, or director stock purchase plans approved by the Board of Directors or all other similar plans where stock is being issued or offered to a trust, other entity or otherwise, for the benefit of any employees, officers or directors of the Company, in each case in the ordinary course of providing incentive compensation, deferral of fees or other compensation; or (iii) issuances of capital stock as full or partial consideration for a merger, acquisition, joint venture, strategic alliance, license agreement or other similar nonfinancing transaction), then the Investor shall be afforded the opportunity to acquire from the Company for the same price (net of any underwriting discounts or sales commissions) and on the same terms (except that, to the extent permitted by law and the Certificate of Incorporation and bylaws of the 

 

  

  

  

 

Company, the Investor may elect to receive such securities in nonvoting form, convertible into voting securities in a widely dispersed or public offering) as such securities are proposed to be offered to others, up to the amount of New Securities in the aggregate required to enable it to maintain its proportionate Common Stock-equivalent interest in the Company immediately prior to any such issuance of New Securities.  The amount of New Securities that the Investor shall be entitled to purchase in the aggregate shall be determined by multiplying (x) the total number or principal amount of such offered New Securities by (y) a fraction, the numerator of which is the number of shares of Common Stock held by the Investor, and the denominator of which is the number of shares of Common Stock then outstanding.

 

(b) Notice.  In the event the Company proposes to offer or sell New Securities, it shall give the Investor written notice of its intention, describing the price (or range of prices), anticipated amount of securities, timing, and other terms upon which the Company proposes to offer the same (including, in the case of a registered public offering and to the extent possible, a copy of the prospectus included in the registration statement filed with respect to such offering), no later than two business days, as the case may be, after the initial filing of a registration statement with the SEC with respect to an underwritten public offering, after the commencement of marketing with respect to a Rule 144A offering or after the Company proposes to pursue any other offering.  The Investor shall have 7 business days from the date of receipt of such a notice to notify the Company in writing that it intends to exercise its rights provided in this Section 1.1 and, as to the amount of New Securities the Investor desires to purchase, up to the maximum amount calculated pursuant to Section 1.1.  Such notice shall constitute a nonbinding indication of interest of the Investor to purchase the amount of New Securities so specified at the price and other terms set forth in the Company's notice to it.  The failure of the Investor to respond within such 7 business day period shall be deemed to be a waiver of the Investor's rights under this Section 1.1 only with respect to the offering described in the applicable notice.

 

(c) Purchase Mechanism.  If the Investor exercises its rights provided in this Section 1.1, the closing of the purchase of the New Securities with respect to which such right has been exercised shall take place within 20 calendar days after the giving of notice of such exercise, which period of time shall be extended for a maximum of 120 days in order to comply with applicable laws and regulations (including receipt of any applicable regulatory or shareholder approvals).  The Company and the Investor agree to use commercially reasonable efforts to secure any regulatory or shareholder approvals or other consents, and to comply with any law or regulation necessary in connection with the offer, sale and purchase of, such New Securities; provided, however, that nothing herein shall require the Investor to consummate any purchase as to which the Investor has exercised its purchase rights provided in Section 1.1 if the Investor determines that doing so could reasonably be expected to result in the Investor, together with its Affiliates, being deemed for purposes of the Bank Holding Company Act of 1956, as amended (the “BHC Act”), or the Change in Bank Control Act of 1978, as amended, to own 10% or more of any class of voting securities of the Company or to otherwise control the Company.

 

(d) Failure of Purchase.  In the event that the Investor fails to exercise its rights provided in this Section 1.1 within said 7 business day period or, if so exercised, the Investor is unable to consummate such purchase within the time period specified in Section (c) because of the Investor's failure to obtain any required regulatory or shareholder consent or approval, the Company shall thereafter be entitled (during the period of 45 days following the 

 

2

  

  

  

 

conclusion of the applicable period) to sell or enter into an agreement (pursuant to which the sale of the New Securities covered thereby shall be consummated, if at all, within 30 days from the date of said agreement) to sell the New Securities not elected to be purchased pursuant to this Section 1.1 by the Investor or which the Investor is unable to purchase because of such failure to obtain any such consent or approval, at a price and upon terms no more favorable in the aggregate to the purchasers of such securities than were specified in the Company's notice to the Investor.  Notwithstanding the foregoing, if such sale is subject to the receipt of any regulatory or shareholder approval or consent or the expiration of any waiting period, the time period during which such sale may be consummated shall be extended until the expiration of five business days after all such approvals or consents have been obtained or waiting periods expired, but in no event shall such time period exceed 120 days from the date of the applicable agreement with respect to such sale.  In the event the Company has not sold the New Securities or entered into an agreement to sell the New Securities within said 45-day period (or sold and issued New Securities in accordance with the foregoing within 30 days from the date of said agreement (as such period may be extended in the manner described above for a period not to exceed 120 days from the date of said agreement)), the Company shall not thereafter offer, issue or sell such New Securities without first offering such securities to the Investors in the manner provided above.

 

(e) Non-Cash Consideration.  In the case of the offering of securities for a consideration in whole or in part other than cash, including securities acquired in exchange therefor (other than securities by their terms so exchangeable), the consideration other than cash shall be deemed to be the fair value thereof as determined by the Board of Directors; provided, however, that such fair value as determined by the Board of Directors shall not exceed the aggregate market price of the securities being offered as of the date the Board of Directors authorizes the offering of such securities.

 

(f) Cooperation.  The Company and the Investor shall cooperate in good faith to facilitate the exercise of the Investor's rights under this Section1.1, including to secure any required approvals or consents.

 

(g) Effectiveness of Gross-Up Rights.  The Company and the Investor agree and acknowledge that the rights granted hereby shall become effective upon the closing of the initial issuance of Common Stock in the Current Offering.  Notwithstanding anything to the contrary, the Company and the Investor agree and acknowledge that the rights granted hereby shall apply to the issuance of Common Stock by the Company pursuant to the exercise of the over-allotment option granted to the underwriters in the Current Offering.

 

ARTICLE II

 

Miscellaneous

 

2.1           Company Authority.  The Company has the corporate power and authority to enter into and deliver this Agreement and to carry out its obligations hereunder.  The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by the affirmative vote of at least a majority of the directors on the Board of Directors of the Company.  This Agreement has been duly and validly executed and delivered by the Company and, assuming due authorization, execution and delivery of this Agreement by the Investor, is a valid and binding obligation of the Company 

 

3

 

  

  

  

 

enforceable against the Company in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, moratorium, reorganizations, fraudulent transfer or similar laws relating to or affecting creditors generally or by general equitable principles (whether applied in equity or at law).

 

2.2           Investor Authority.  The Investor has the power and authority to enter into and deliver this Agreement and to carry out its obligations hereunder.  The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by the affirmative vote of at least a majority of the Investor’s board of directors or other governing body.  This Agreement has been duly and validly executed and delivered by the Investor and, assuming due authorization, execution and delivery of this Agreement by the Company, is a valid and binding obligation of the Investor enforceable against the Investor in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, moratorium, reorganizations, fraudulent transfer or similar laws relating to or affecting creditors generally or by general equitable principles (whether applied in equity or at law).

 

2.3           Financial Capability.  The Investor will have immediately available funds necessary to consummate the transactions contemplated hereby, as of the date of any closing, on the terms and conditions contemplated by this Agreement.

 

2.4           Amendment.  No amendment or waiver of this Agreement will be effective with respect to any party unless made in writing and signed by an officer of a duly authorized representative of such party.

 

2.5           Counterparts and Facsimile.  For the convenience of the parties hereto, this Agreement may be executed in any number of separate counterparts, each such counterpart being deemed to be an original instrument, and all such counterparts will together constitute the same agreement.  Executed signature pages to this Agreement may be delivered by facsimile and such facsimiles will be deemed as sufficient as if actual signature pages had been delivered.

 

2.6           Governing Law.  This Agreement will be governed by and construed in accordance with the laws of the State of New York applicable to contracts made and to be performed entirely within such State.

 

2.7           Notices.  Any notice, request, instruction or other document to be given hereunder by any party to the other will be in writing and will be deemed to have been duly given (a) on the date of delivery if delivered personally or by telecopy or facsimile, upon confirmation of receipt, (b) on the first business day following the date of dispatch if delivered by a recognized next-day courier service, or (c) on the third business day following the date of mailing if delivered by registered or certified mail, return receipt requested, postage prepaid.  All notices hereunder shall be delivered as follows:

 

(a) If to the Investor:

610 Broadway

6th Floor

New York, NY 10012

Attn: Hal Goltz

 

 

4

  

  

  

 

Facsimile:  (212) 432-4601

 

with copies to:

 

 

Milbank, Tweed, Hadley & McCloy LLP

Suite 1100

1850 K Street NW

Washington DC, 20006

Attn: Winthrop N. Brown

Facsimile:  (202) 263-7514

 

(b) If to the Company:

 

Sun Bancorp, Inc.

226 Landis Avenue

Vineland, New Jersey 08360

Attn:  Chief Executive Officer

Facsimile:  (856) 691-9187

 

with a copy to:

Malizia Spidi & Fisch, PC

1227 25th Street, N.W.

Suite 200 West

Washington, D.C. 20037

Attn:  John J. Spidi

Facsimile:  (202) 434-4661

 

2.8           Entire Agreement, Etc.  This Agreement constitutes the entire agreement, and supersede all other prior agreements, understandings, representations and warranties, both written and oral, between the parties, with respect to the subject matter hereof; the terms and conditions of this Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and their permitted assigns.

 

2.9           Certain Definitions.  When used in this Agreement, the following terms shall have the meanings set forth below:

 

(a)  the term "Affiliate" means, with respect to any person, any person directly or indirectly controlling, controlled by or under common control with, such other person.  For purposes of this definition, "control" (including, with correlative meanings, the terms "controlled by" and "under common control with") when used with respect to any person, means the possession, directly or indirectly, of the power to cause the direction of management and/or policies of such person, whether through the ownership of voting securities by contract or otherwise;

 

5

  

  

  

 

(b)           "business day" means any day except Saturday, Sunday and any day which shall be a legal holiday or a day on which banking institutions in the State of New York or the State of New Jersey generally are authorized or required by law or other governmental actions to close;

 

(c)           "person" has the meaning given to it in Section 3(a)(9) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act; and

 

(d)           "beneficially own," "beneficial owner" and "beneficial ownership" are defined in Rules 13d-3 and 13d-5 of the Exchange Act.

 

6

 

 

  

  

  

 

IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the duly authorized officers of the parties hereto as of the date first herein above written.

 

 

SUN BANCORP, INC.

 

By:           /s/ Thomas X. Geisel                                                                

Thomas X. Geisel

President and Chief Executive Officer

 

ANCHORAGE CAPITAL GROUP, LLC

 

By:           /s/ Daniel Allen                                                                

Name: Daniel Allen

Title: Partner

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00186-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00186-of-00352.parquet"}]]