SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF THE
SECURITIES EXCHANGE ACT OF 1934

Dated: November 15, 2007

Commission File No. 001-33811

NAVIOS MARITIME PARTNERS L.P.

85 Akti Miaouli Street, Piraeus, Greece 185 38
(Address of Principal Executive Offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F:

Form 20-F    X     Form 40-F                

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Yes                   No     X    

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Yes                   No     X    

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes                   No    X

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    Execution of Revolving Credit and Term Loan Facility

On November 15, 2007, Navios entered into a Revolving Credit and Term Loan Facility for $260 million (the ‘‘Facility’’) in connection with its initial public offering and the completion of the purchase of certain of its vessels. The Facility was made by and between Navios, Commerzbank AG and DVB Bank AG, as lenders, and DVB Bank AG as agent, swap bank, joint-arranger and security trustee, and Commerzbank AG as payment agent, account bank, joint-arranger and swap bank. The Facility is a revolving facility for up to four years and converts to a term facility for up to 6.5 years thereafter so that final maturity will be 10 years. The interest rate is LIBOR plus a margin of between 0.8% and 1.25% depending on the loan to value ratio. Obligations under the Facility are secured by first priority mortgages covering each of Navios’ vessels and other collateral and are guaranteed by each vessel-owning subsidiary. The Facility contains certai n operating restrictive covenants, as well as compliance requirements and maintenance of certain financial ratios. A copy of the Facility is furnished as Exhibit 99.1 to this Report and is incorporated herein by reference.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

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EXHIBIT INDEX

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Private and Confidential

DATED 15 November 2007

NAVIOS MARITIME PARTNERS L.P.

as Borrower

COMMERZBANK AG and DVB BANK AG

as Lenders

DVB BANK AG

as Swap Bank, Agent, Joint-Arranger

and Security Trustee

and

COMMERZBANK AG

as Payment Agent, Account Bank,

Joint-Arranger and Swap Bank

FACILITY AGREEMENT FOR A USD 260,000,000

REVOLVING CREDIT AND TERM LOAN FACILITY

INCE & CO

47-49 Akti Miaouli

Piraeus 185 36

Greece

Tel: 210 429 2543

Fax: 210 429 3318

 

 

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Index

 

 

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NOW IT IS HEREBY AGREED AS FOLLOWS:

 

This Agreement sets out the terms and conditions on which Commerzbank AG and DVB Bank AG agree to make available to the Borrower a loan in the sum of two hundred and sixty million Dollars (USD 260,000,000) for the purpose of:

In this Agreement, unless the context otherwise requires:

“Acceptable Charter” means in respect of “FANTASTIKS”, a charterparty in respect thereof which (i) covers at least the period March 2011 until September 2014, (ii) is at a net

 

 

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daily charterhire of at least USD35,000 and (iii) is made with a charterer acceptable to the Agent;

“Account Bank” means Commerzbank AG a company incorporated in Germany, acting through its branch at Ness 7, 20457, Hamburg Germany or such other Lender as may be designated by the Agent as the Account Bank for the purposes of this Agreement;

“Advance A” means the advance of USD170,000,000 to be applied in the acquisition by the Borrower of the Existing Owners;

“Advance B” means the advance of USD30,000,000 to be applied in on-lending to Fantastiks for to be applied in or towards the acquisition of “FANTASTIKS”;

“Advance C” means the advance equal to the lesser of (i) USD60,000,000 and (ii) 65% of the Valuation Amount of the Newbuilding no more than a month prior to her acquisition by Nostos, to be applied to in or towards the acquisition of the Newbuilding;

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

“Agent” means DVB Bank AG a company incorporated in Germany, acting through its branch at 2-14 Friedrich-Ebert-Anlage, 60325 Frankfurt am Main, Germany (or of such other address as may last have been notified to the other parties to this Agreement pursuant to clause 17.2.3) or such other person as may be appointed as agent by the Lenders pursuant to clause 16.13;

“Applicable Margin” means, in relation to each Interest Period (i) up to and including 31 March 2008, 0.80%, and (ii) thereafter the relevant one of the following as shall be notified to the Borrower by the Payment Agent under Clause 3.5:

 

 

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where “Loan Amount” means the average of the amount of the Loan on close of business in Germany on each day during the three months preceding the Interest Period to which the Applicable Interest applies;

“Approved Broker” means each of (i) H Clarkson & Co. Ltd. of St Magnus House, 3 Lower Thames Street, London EC3R 6HE, England, (ii) Arrow Research Ltd. of Harbour House, Chelsea Harbour, London SW10 0XE, England and (iii) Fearnleys AS of Grev Wedels Plass 9, P.O.Box 1158 Sentrum, Oslo N-0107 Norway or such other reputable, independent and first class firm of shipbrokers specialising in the valuation of vessels of the relevant type appointed by the Agent and agreed with the Borrower;

“Arrangers” means, together, DVB Bank AG a company incorporated in Germany, acting through its branch at 2-14 Friedrich-Ebert-Anlage, 60325 Frankfurt am Main, Germany and Commerzbank AG acting through its office at Ness 7-9, 20457 Hamburg, Germany;

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

“Banks” means, together, the Arrangers, the Agent, the Payment Agent, the Account Bank, the Security Trustee, the Lenders, the Swap Banks and any Transferee Lenders;

“Borrower” means Navios Maritime Partners L.P, a limited partnership established in the Marshall Islands and having its registered office at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands, MH96960;

“Break Costs” means the aggregate amount of all losses, premiums, penalties, costs and expenses whatsoever certified by the Payment Agent at any time and from time to time as having been incurred by the Lenders or any of them in maintaining or funding their Contributions or in liquidating or re-employing fixed deposits acquired to maintain the same as a result of either:

 

 

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“Builder” means Daewoo Shipbuilding & Marine Engineering Co. Ltd. organised and existing under the laws of South Korea;

“Certified Copy” means in relation to any document delivered or issued by or on behalf of any company, a copy of such document certified as a true, complete and up to date copy of the original by any of the directors or officers for the time being of such company or by such company’s attorneys or solicitors;

“Charter Assignment” means a specific assignment of each Existing Charter and each Existing Charter-out and of any Extended Employment Contract required to be executed hereunder by any Owner or any Charterer in favour of the Security Trustee (including any notices and/or acknowledgements and/or undertakings associated therewith) in such form as the Agent and the Majority Lenders may require in their sole discretion;

“Charter Test Date” means 30 September 2010;

“Chartered Vessels” means the Vessels referred to in Schedule 2 Part B while the same are subject to an Existing Charter-in;

“Charterer” means each of the following corporations, each of which is incorporated in the Marshall Islands, and has its registered office at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands, MH96960;

“Charter Accounts” means the interest bearing USD current accounts of the Shareholder in relation to “NAVIOS ALDERBARAN” and “NAVIOS PROSPERITY” paying interest at a rate to be agreed between the Account Bank and the Shareholder opened with the Account Bank and includes any sub-accounts thereof and any other account designated in writing by the Payment Agent to be a Charter Account for the purposes of this Agreement;

 

 

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“Charter Account Pledges” means, together, a first priority charge required to be executed hereunder between the Shareholder and the Lenders in respect of each Charter Account in such form as the Agent and the Majority Lenders may require in their sole discretion;

“Classification” means, in relation to each Mortgaged Vessel, the highest class available for a vessel of her type with the relevant Classification Society;

“Classification Society” means, in relation to each Mortgaged Vessel, any IACS classification society which the Lenders shall, at the request of the Borrower, have agreed in writing shall be treated as the classification society in relation to such Mortgaged Vessel for the purposes of the relevant Ship Security Documents;

“Commitment” means in relation to each Lender, the sum set out opposite its name in schedule 1 part 1 or any replacement thereof, pursuant to the terms of any relevant Transfer Certificate as the amount which, subject to the terms of this Agreement, it is obliged to advance to the Borrower hereunder in respect of the Loan Facility, in each case as such amount may have been reduced and/or cancelled under this Agreement;

“Compliance Certificate” means a certificate substantially in the form set out in schedule 6 signed by the chief financial officer of the Borrower;

“Compulsory Acquisition” means, in respect of a Mortgaged Vessel, requisition for title or other compulsory acquisition including, if that ship is not released therefrom within the Relevant Period, capture, appropriation, forfeiture, seizure, detention, deprivation or confiscation howsoever for any reason (but excluding requisition for use or hire) by or on behalf of any Government Entity or other competent authority or by pirates, hijackers, terrorists or similar persons; “Relevant Period” means for the purposes of this definition of Compulsory Acquisition either (i) sixty (60) days or, (ii) if relevant underwriters confirm in writing (in terms satisfactory to the Majority Lenders) prior to the end of such sixty (60) day period that such capture, seizure, detention or confiscation will be fully covered by the relevant Owner’s war risks insurance if continuing for a further period exceeding ten (10) calendar months, the shorter of twelve (12) months and such period at the end of which cover is confirmed to attach;

 

 

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

“Credit Support Document” has in relation to the Master Agreement, the meaning given to that expression therein;

“Credit Support Provider” means any person defined as such in the Master Agreement;

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

“Dollars” and “USD” mean the lawful currency of the USA and in respect of all payments to be made under any of the Security Documents means 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 US dollars);

“Drawdown Date” means, in relation to each Advance, any date being a Banking Day falling during the relevant Drawdown Period, 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 schedule 3;

“Drawdown Period” means the period commencing on the Execution Date and ending on either (i) if “FANTASTIKS” is subject to an Acceptable Charterparty on the Charter Test Date, the date falling 51 months after the Execution Date or (ii) otherwise, the date falling 45 months after the Execution Date or in any case any date on which the Commitment is finally cancelled or no longer available under the terms of this Agreement;

“Earnings Account” means the interest bearing USD current account of the Shareholder paying interest at a rate to be agreed between the Account Bank and the Shareholder opened with the Account Bank and includes any sub-accounts thereof and any other

 

 

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account designated in writing by the Payment Agent to be the Earnings Account for the purposes of this Agreement;

“Earnings Account Pledge” means a first priority charge required to be executed hereunder between the Shareholder and the Lenders in respect of the Earnings Account in such form as the Agent and the Majority Lenders may require in their sole discretion;

“EBITDA” means the aggregate amount of combined pre-tax profits of the Group before extraordinary or exceptional items, interest, depreciation and amortisation as shown, at any relevant time, by the Latest Accounts;

“Encumbrance” means any mortgage, charge, pledge, lien, hypothecation, assignment, title retention, preferential right, option, trust arrangement or security interest or other encumbrance, security or arrangement conferring howsoever a priority of payment in respect of any obligation of any person;

“Environmental Affiliate” means any agent or employee of the Borrower, the Manager, or any other Group Member or any other person having a contractual relationship with the Borrower, the Manager or any other Group Member in connection with any Relevant Ship or its operation or the carriage of cargo and/or passengers thereon and/or the provision of goods and/or services on or from any Relevant Ship;

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

“Environmental Claim” means (i) any claim by, or directive from, any applicable Government Entity alleging breach of, or non-compliance with, any Environmental Laws or Environmental Approvals or otherwise howsoever relating to or arising out of an Environmental Incident or (ii) any claim by any other third party howsoever relating to or arising out of an Environmental Incident (and, in each such case, “claim” shall include a claim for damages and/or direction for and/or enforcement relating to clean-up costs,

 

 

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removal, compliance, remedial action or otherwise) or (iii) any Proceedings arising from any of the foregoing;

“Environmental Incident” means, regardless of cause, (i) any actual or threatened discharge or release of Environmentally Sensitive Material from any Relevant Ship; (ii) any incident in which Environmentally Sensitive Material is discharged or released from a vessel other than a Relevant Ship which involves collision between a Relevant Ship and such other vessel or some other incident of navigation or operation, in either case, where the Relevant Ship, the Manager and/or the relevant Owner and/or the relevant Group Member and/or the relevant Operator are actually, contingently or allegedly at fault or otherwise howsoever liable (in whole or in part) or (iii) any incident in which Environmentally Sensitive Material is discharged or released from a vessel other than a Relevant Ship and where such Relevant Ship is actually or potentially liable to be arrested as a result and/or where the Manager and/or the relevant Owner and/or other Group Member and/or the relevant Operator are actually, contingently or allegedly at fault or otherwise howsoever liable;

“Environmental Laws” means all laws, regulations, conventions and agreements whatsoever relating to pollution, human or wildlife well-being or protection of the environment (including, without limitation, the United States Oil Pollution Act of 1990 and any comparable laws of the individual States of the USA);

“Environmentally Sensitive Material” means oil, oil products or any other products or substance which are polluting, toxic or hazardous or any substance the release of which into the environment is howsoever regulated, prohibited or penalised by or pursuant to any Environmental Law;

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

“Execution Date” means the date on which this Agreement has been executed by all the parties hereto;

“Existing Charters” means, together:

 

 

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as charterer and the relevant Owner for a charterhire of USD21,613 net per day until 1 January 2008 and thereafter for a charterhire of USD23,513 net per day until 31 December 2010;

 

 

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“Existing Charters-in” means, together:

“Existing Charters-out” means, together:

“Existing Owners” means together:

“Extended Employment Contract” means, in respect of a Mortgaged Vessel, any time charterparty, contract of affreightment or other contract of employment of such ship

 

 

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(including the entry of any Vessel in any pool) which has a tenor of not less than thirteen (13) months (including any options to renew or extend such tenor);

“Facility Period” means the period starting on the date of this Agreement and ending on such date as all obligations whatsoever of all of the Security Parties under or pursuant to the Security Documents whensoever arising, actual or contingent, have been irrevocably paid, performed and/or complied with;

“FANTASTIKS” means the 180,265 dwt capesize bulk carrier owned by the Fantastiks Seller and which is to be purchased by Fantastiks under the Fantastiks MOA and to be registered on the Panamanian flag with the name “FANTASTIKS”;

“Fantastiks Assignment” means the deed of assignment required to be executed hereunder by Fantastiks in favour of the Security Trustee in respect of its interest in and rights under the Fantastiks MOA, in such form as the Agent and the Majority Lenders may require in their sole discretion;

“Fantastiks Charters” means, together (i) the time charterparty in respect of m.v. “FANTASTIKS” dated 29th September, 2002 made between Kleimar as charterer and Southern Route Maritime SA as owner until March 2013 and (ii) the time charterparty (the “Fantastiks Charter-out”) in respect of m.v. “FANTASTIKS” dated 14 June 2005 made between Kleimar as charterer and The Sanko Steamship Co. Ltd. as charterer for a charterhire of USD32,272 net per day until March 2011;

“Fantastiks MOA” means the memorandum of agreement dated 31 October 2007 made between Kleimar as seller and Fantastiks as buyer of “FANTASTIKS”;

“Fantastiks Kleimar MOA” means the memorandum of agreement dated 31 October 2007 made between the Fantastiks Seller as seller and Kleimar as buyer of “FANTASTIKS”;

“Fantastiks Seller” means Southern Route Maritime SA of Panama;

“Flag State” means Panama or any other country acceptable to the Lenders;

“General Assignment” means, in respect of each Mortgaged Vessel, the deed of assignment of its earnings, insurances and requisition compensation executed or to be

 

 

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executed by the relevant Owner in favour of the Security Trustee in such form as the Agent and the Majority Lenders may require in their sole discretion;

“Government Entity” means any national or local government body, tribunal, court or regulatory or other agency and any organisation of which such body, tribunal, court or agency is a part or to which it is subject;

“Group” means the Borrower and its subsidiaries;

“Group Member” means any member of the Group;

“Guarantee” means each unconditional, irrevocable and on demand guarantee of the obligations of the Borrower under this Agreement and the Master Agreements required to be executed by the Guarantors and the Shareholder in favour of the Security Trustee in such form as the Agent and the Majority Lenders may require in their sole discretion;

“Guarantors” means each of the following corporations, each of which is incorporated in the Marshall Islands, and has its registered office at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands, MH96960;

and Fantastiks Shipping Corporation (herein referred to as “Fantastiks”) upon it becoming an Owner pursuant to the Fantastiks MOA;

“Indebtedness” means any obligation howsoever arising (whether present or future, actual or contingent, secured or unsecured as principal, surety or otherwise) for the payment or repayment of money;

 

 

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“Interest Expense” means, for any relevant financial year, the aggregate interest payable by the Group and any member thereof on any Indebtedness during such period;

“Interest Payment Date” means the last day of an Interest Period and, if an Interest Period is longer than three (3) months, the date falling at the end of each successive period of three (3) months from the start of such Interest Period;

“Interest Period” means, in relation to an Advance and the Loan, each period for the calculation of interest ascertained in accordance with clauses 3.2 and 3.3;

“ISM Code Documentation” means, in relation to a Mortgaged Vessel, the document of compliance (DOC) and safety management certificate (SMC) issued by a Classification Society pursuant to the ISM Code in relation to that Mortgaged Vessel within the periods specified by the ISM Code;

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

“ISPS Code” means the International Ship and Port Security Code of the International Maritime Organisation and includes any amendments or extensions thereto and any regulations issued pursuant thereto;

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

“Kleimar” means Kleimar NV, whose registered office is at Suikerrui 5, B-2000 Antwerp, Belgium;

“Latest Accounts” means, in respect of any financial quarter or year of the Group, the latest unaudited (in respect of each financial quarter) or audited (in respect of each financial year) financial statements required to be prepared pursuant to clause 8.1.6;

“Lenders” means the banks listed in schedule 1 part 1 and Transferee Lenders;

“Lending Branch” means, in respect of each Lender, its office or branch at the address set out beneath its name in schedule 1 (or, in the case of a Transferee, in the Transfer Certificate to which it is a party as Transferee) or such other office or branch as any

 

 

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Lender shall from time to time select and notify through the Payment Agent to the other parties to this Agreement;

“LIBOR” means, for a particular period, the rate equal to the offered quotation for deposits in USD in an amount comparable with the amount in relation to which LIBOR is to be determined for a period equal to, or as near as possible equal to, the relevant period which appears on Reuters Screen LIBOR01 at or about 11 a.m. on the second Banking Day before the first day of such period (and, for the purposes of this Agreement, “Reuters Screen LIBOR01” means the display designated as “LIBOR01” on the Reuters Service or such other page as may replace LIBOR01 on that service for the purpose of displaying rates comparable to that rate or on such other service as may be nominated by the British Bankers’ Association as the information vendor for the purpose of displaying the British Bankers’ Association Interest Settlement Rates for USD);

“Liquidity” means:

which in each case:

“Loan” means the aggregate principal amount in respect of the Loan Facility owing to the Lenders under this Agreement at any relevant time;

 

 

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“Loan Facility” means the loan facility provided by the Lenders on the terms and subject to the conditions of this Agreement in the amount of USD 260,000,000;

“Majority Lenders” means at any relevant time when there are two Lenders, both of them, and at any time when there are more than two Lenders, the Lenders whose Contributions exceed 75% of the Loan;

“Management Agreement” means, in respect of each Mortgaged Vessel, the agreement between the Owners and the Manager, in a form previously approved in writing by the Agent (acting on the instructions of the Majority Lenders);

“Manager” means Navios Shipmanagement Inc., a company incorporated in the Marshall Islands and having its registered office at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands, MH96960 or any other person appointed by an Owner, with the prior written consent of the Agent, as the commercial and/or technical manager of the relevant Mortgaged Vessel;

“Manager’s Undertakings” means, collectively, the undertakings and assignments required to be executed hereunder by the Manager in favour of the Security Trustee in respect of each of the Mortgaged Vessels each in such form as the Agent and the Majority Lenders may require in their sole discretion;

“Mandatory Cost” means the percentage rate calculated by the Agent in accordance with Schedule 8;

“Master Agreements” means together (i) an ISDA Master Agreement made or to be made between the DVB and the Borrower and (ii) an ISDA Master Agreement made or to be made between Commerzbank and the Borrower;

“Master Agreement Security Deed” means, in relation to each Master Agreement, the security deed executed or (as the context may require) to be each executed by the Borrower in favour of the Security Trustee in such form as the Agent and the Majority Lenders may require in their sole discretion and in the plural means both of them;

“Material Adverse Effect” means any event or occurrence which the Majority Lenders reasonably determine has had or could reasonably be expected to have a material adverse

 

 

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effect on (i) the Banks’ rights under, or the security provided by, any Security Document, (ii) the ability of any Security Party or other member of the Group to perform or comply with any of its obligations under any Security Document or (iii) the value or nature of the property, assets, operations, liabilities or financial condition of any member of the Group;

“Maturity Date” means the date falling 10 years after the Execution Date;

“MII & MAP Policy” means a mortgagee’s interest and pollution risks insurance policy (including additional perils (pollution) cover) in respect of each Mortgaged Vessel to be effected by the Security Trustee on or before the first Drawdown Date to cover the Mortgaged Vessels as the same may be renewed or replaced annually thereafter and maintained throughout the Facility Period through such brokers, with such underwriters and containing such coverage as may be acceptable to the Security Trustee in its sole discretion, insuring a sum of at least one hundred and twenty per cent (120%) of the Loan in respect of mortgagee’s interest insurance and one hundred and twenty per cent (120%) of the Loan in respect of additional perils cover;

“Minimum Liquidity” means, on the first Drawdown Date, USD5,000,000 as the same shall increase by USD8,000,000 on 31 December 2008 and on each anniversary thereof up to and including 31 December 2011;

“MOAs” means together the Fantastiks Kleimar MOA, the Fantastiks MOA and the Newbuilding MOA;

“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, in respect of each Vessel, the first preferred Panamanian Ship mortgage thereof required to be executed hereunder by the Owner thereof in favour of

 

 

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the Security Trustee, each in such form as the Agent and the Majority Lenders may require in their sole discretion;

“Mortgaged Vessel” means, at any relevant time, any Vessel which is at such time subject to a Mortgage and a Vessel shall, for the purposes of this Agreement, be regarded as a Mortgaged Vessel as from the date on which the Mortgage of that Vessel has 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 to the Agent pursuant to clause 4.3 or 4.5 following the Total Loss or sale respectively of such Vessel and (ii) the end of the Facility Period;

“Navios GP” means Navios GP L.L.C., a limited liability company organised and existing under the laws of the Marshall Islands and having its registered office at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, MH96960, Marshall Islands;

“Navios Holdings” means Navios Maritime Holdings Inc., a corporation incorporated in the Marshall Islands and having its registered office at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, MH96960, Marshall Islands;

“Net Worth” means, by reference to the Latest Accounts in respect of the Group, the Total Assets (adjusted for market value) less Total Liabilities of the Group;

“Newbuilding” means the 180,000 dwt capesize bulk carrier which is being constructed by the Builder with Builder’s Hull No. 1172 and which is to be purchased by, Nostos under the Newbuilding MOA and to be registered on the Panamanian flag with a name to be decided;

“Newbuilding MOA” means the memorandum of agreement dated 19 July 2007 entered into between the Newbuilding Seller and Nostos for the sale and purchase of the Newbuilding;

“Newbuilding Seller” means Dry Bulk World Inc. of Panama;

“Omnibus Agreement” means the agreement made or to be made between the Borrower, the Shareholder, Navios GP and Navios Holdings in relation to certain business opportunities of the parties thereto in a form acceptable to the Lenders;

 

 

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

“Owned Vessels” means the Vessels referred to in Schedule 2 Part A;

“Owner” means, in respect of each Vessel, the Guarantor which is stated in schedule 2 to be the owner thereof or, in relation to the Newbuilding and “FANTASTIKS”, Nostos and Fantastiks respectively upon becoming the owner thereof;

“Payment Agent” means Commerzbank AG a company incorporated in Germany, acting through its branch at Ness 7, 20457, Hamburg, Germany (or of such other address as may last have been notified to the other parties to this Agreement pursuant to clause 17.2.3) or such other person as may be appointed as agent by the Lenders pursuant to clause 16.13;

“Permitted Encumbrance” means any Encumbrance in favour of the Banks or any of them created pursuant to the Security Documents and Permitted Liens;

“Permitted Liens” means any lien on any Mortgaged Vessel for master’s, officer’s or crew’s wages outstanding in the ordinary course of trading, any lien for salvage and any ship repairer’s or outfitter’s possessory lien for a sum not (except with the prior written consent of the Agent) exceeding the Casualty Amount (as defined in the Ship Security Documents for such Mortgaged Vessel);

“Permitted Owners” means, in relation to the Borrower, any one or more of Navios Holdings, any of its subsidiaries, Navios GP and, (as legal and/or beneficial owner), Mrs. Angeliki Frangou;

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

“Prepayment Ratio” means in respect of the sale or Total Loss of a Mortgaged Vessel the Valuation Amount of such Mortgaged Vessel immediately prior to such sale or Total Loss divided by the Security Value immediately prior to such sale or Total Loss and for these

 

 

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purposes any valuation of a Vessel (calculated in accordance with Clause 8.2.2) may be no more than two months old;

“Proceedings” means any litigation, arbitration, legal action or complaint or judicial, quasi-judicial or administrative proceedings whatsoever arising or instigated by anyone (private or governmental) in any court, tribunal, public office or other forum whatsoever and wheresoever (including, without limitation, any action for provisional or permanent attachment of any thing or for injunctive remedies or interim relief and any action instigated on an ex parte basis);

“Registry” means, in relation to each Vessel, the office of the registrar, commissioner or representative of the Flag State, who is duly empowered to register such Vessel, the relevant Owner’s title thereto and the relevant Mortgage under the laws and flag of the Flag State;

“Relevant Ship” means each of the Mortgaged Vessels and any other ship from time to time (whether before or after the date of this Agreement) owned, managed or crewed by, or chartered to, any Group Member;

“Repayment Date” means the date on which any instalment of the Loan is repayable under the provisions of clause 4.1;

“Required Authorisation” means any authorisation, consent, declaration, licence, permit, exemption, approval or other document, whether imposed by or arising in connection with any law, regulation, custom, contract, security or otherwise howsoever which must be obtained at any time from any person, Government Entity, central bank or other self-regulating or supra-national authority in order to enable the Borrower lawfully to borrow the loan or draw any Advance and/or to enable any Security Party lawfully and continuously to continue its corporate existence and/or perform all its obligations whatsoever whensoever arising and/or grant security under the relevant Security Documents and/or to ensure the continuous validity and enforceability thereof;

“Required Security Amount” means the amount in USD (as certified by the Agent) which is at any relevant time one hundred and forty three per cent (143%) of the Loan;

 

 

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“Retention Account” means an interest bearing USD current account of the Borrower paying interest at a rate to be agreed between the Account Bank and the Borrower opened with the Account Bank and includes any sub-accounts thereof and any other account designated in writing by the Payment Agent to be the Retention Account for the purposes of this Agreement;

“Retention Account Pledge” means a first priority charge required to be executed hereunder between the Borrower and the Lenders in respect of the Retention Account in such form as the Agent and the Majority Lenders may require in their sole discretion;

“Retention Amount” means, in relation to any Retention Date, such sum as shall be the aggregate of:

“Retention Dates” means the date falling thirty (30) days after the first Drawdown Date and each of the dates falling at monthly intervals after such date and prior to the Maturity Date;

“Revolving Advance” means each amount of any part of the Loan which has been repaid pursuant to clause 4.2 and which the Borrower re-draws in accordance with Clause 2.6;

 

 

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“Revolving Commitment” means in relation to each Lender in relation to each Revolving Advance, the ratio which that Lender’s Contribution bears to the Loan immediately prior to advance of the relevant Revolving Advance multiplied by the relevant Revolving Advance;

“Revolving Facility” means any part of the Loan which, after it has been drawn down hereunder, has been prepaid by the Borrower pursuant to Clause 4.2, which sums are available subject to the terms of this Agreement to be advanced to the Borrower during the Drawdown Period pursuant to Clause 2.6 and as the amount thereof may be reduced pursuant to Clause 2.8;

“Security Documents” means this Agreement, the Master Agreements, the Master Agreement Security Deeds, the Fantastiks Assignment, the Mortgages, the Guarantees, the General Assignments, the Charter Assignments, the Charter Account Pledges, the Earnings Accounts Pledge, the Retention Account Pledge, the Manager’s Undertakings, (with effect from the date of execution pursuant to Clause 8.1.19) the Shares Pledges 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 to govern and/or secure all or any part of the Loan, interest thereon and other moneys from time to time owing by the Borrower pursuant to this Agreement and/or the Master Agreement (whether or not any such document also secures moneys from time to time owing pursuant to any other document or agreement);

“Security Party” means the Borrower, the Manager, the Guarantors or any other person who may at any time be a party to any of the Security Documents (other than the Banks);

“Security Trustee” means DVB Bank AG a company incorporated in Germany, acting through its branch at 2-14 Friedrich-Ebert-Anlage, 60325 Frankfurt am Main, Germany (or of such other address as may last have been notified to the other parties to this Agreement pursuant to clause 17.2.3) or such other person as may be appointed as Security Trustee and trustee by the Lenders, the Payment Agent and the Agent pursuant to clause 16.14;

 

 

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“Security Value” means the amount in USD (as certified by the Agent) which is, at any relevant time, the aggregate of (a) the Valuation Amounts of the Mortgaged Vessels as most recently determined in accordance with clause 8.2.2 and (b) the net realizable market value of any additional security for the time being actually provided to the Lenders pursuant to clause 8.2.1(b);

“Shareholder” means, Navios Maritime Operating L.L.C. a company incorporated in the Marshall Islands and having its registered office at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands, MH96960;

“Shares Pledge” means the first priority pledge of the shares of and in each Owner required to be executed at any time under clause 8.1.19 by the Shareholder in favour of the Security Trustee and/or a Lender in such form as the Agent and the Majority Lenders may require in their sole discretion and in the plural means all of them;

“Ship Security Documents” means, in relation to each Mortgaged Vessel, the relevant Mortgage, the relevant General Assignment, any relevant Charter Assignment and the relevant Manager’s Undertaking;

“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 Banks” means each of DVB Bank AG a company incorporated in Germany, acting through its branch at 2-14 Friedrich-Ebert-Anlage, 60325 Frankfurt am Main, Germany and Commerzbank AG (in such capacity, “Commerzbank”) acting through its office at Kaiserstrasse 16, 60261 Frankfurt am Main, Germany;

“Taxes” includes all present and future income, corporation, capital or value-added taxes and all stamp and other taxes and levies, imposts, deductions, duties, charges and withholdings whatsoever together with interest thereon and penalties in respect thereto, if any, and charges, fees or other amounts made on or in respect thereof (and “Taxation” shall be construed accordingly);

 

 

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“Total Assets” and “Total Liabilities” mean, respectively, the total assets and total liabilities of the Corporate Guarantor’s Group as evidenced at any relevant time by the Latest Accounts, in which they shall have been calculated by reference to the meanings assigned to them in accordance with US GAAP provided that the value of any ship shall be the value thereof calculated in accordance with Clause 8.2.2 and not as set out in the Latest Accounts;

“Total Commitment” means, at any relevant time, the aggregate of the Commitments of all the Lenders at such time (being the aggregate of the sums set out opposite their names in schedule 1);

“Total Loss” means, in relation to “FANTASTIKS” (prior to the advance of Advance B) and each Mortgaged Vessel:

“Transaction” means a Transaction as defined in the Master Agreement;

“Transfer Certificate” means a certificate in substantially the form set out in schedule 5;

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

“Transferor Lender” 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 7;

 

 

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“Trust Property” means (i) the security, powers, rights, titles, benefits and interests (both present and future) constituted by and conferred on the Banks or any of them 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 any Bank in the Security Documents), (ii) all moneys, property and other assets paid or transferred to or vested in any Bank (or anyone else on such Bank’s behalf) or received or recovered by any Bank (or anyone else on such Bank’s behalf) 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 any Bank (or anyone else on such Bank’s behalf) in respect of the same (or any part thereof);

“Underlying Documents” means, together, the Fantastiks MOA, the MOAs, the Existing Charters, the Existing Charters-in, the Existing Charters-out, any Extended Employment Contracts and the Management Agreements;

“Unlawfulness” means any event or circumstance which either is or, as the case may be, might in the opinion of the Agent become the subject of a notification by the Agent to the Borrower under clause 12.1;

“USA” means the United States of America;

“Valuation Amount” means, in respect of each Mortgaged Vessel, the value thereof as most recently determined under clause 8.2.2; and

“Vessels” means together the Owned Vessels, the Chartered Vessels and the Newbuilding.

In this Agreement, unless the context otherwise requires:

 

 

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Currencies are referred to in this Agreement by the three letter currency codes (ISO 4217) allocated to them by the International Organisation for Standardisation.

Except for clause 19, no part of this Agreement shall be enforceable under the Contracts (Rights of Third Parties) Act 1999 by a person who is not a party to this Agreement.

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

 

 

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The Lenders, relying upon each of the representations and warranties in clause 7, agree to provide to the Borrower upon and subject to the terms of this Agreement, the Loan by making available the Advances for the purposes of (i) financing part of the purchase price of the Newbuilding, (ii) financing part of the purchase price of “FANTASTIKS” and (iii) financing the acquisition of the Existing Owners, financing part of the purchase price of “FANTASTIKS” and providing the Borrower with general corporate and working capital. Subject to the terms of this Agreement, the obligations of the Lenders shall be to contribute to each Advance, the proportion of the relevant Advance which their respective Commitments bear to the aggregate Commitments on any relevant Drawdown Date.

The obligations of the Lenders under this Agreement are several according to their respective Commitments and/or Contributions. The failure of any Lender to perform such obligations shall not relieve any other party to this Agreement of any of its respective obligations or liabilities under this Agreement nor shall any Bank be responsible for the obligations of any other Bank (except for its own obligations, if any, as a Lender) under this Agreement.

Notwithstanding any other term of this Agreement (but without prejudice to the provisions of this Agreement relating to or requiring action by the Majority Lenders) the interests of the Banks are several and the amount due to any Bank is a separate and independent debt. Each Bank shall have the right to protect and enforce its rights arising out of this Agreement and it shall not be necessary for any other Bank to be joined as an additional party in any Proceedings for this purpose.

 

 

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Upon receipt of a Drawdown Notice complying with the terms of this Agreement, the Payment Agent shall promptly notify each Lender and each Lender shall make available to the Payment Agent its portion of the relevant Advance for payment by the Payment Agent in accordance with clause 6.2. The Borrower acknowledges that payment of any Advance to the account referred to in Clause 2.5.3 shall satisfy the obligation of the Lenders to lend that Advance to the Borrower under this Agreement.

The Borrower may at any time during the Drawdown Period by notice to the Payment Agent (effective only on actual receipt) cancel with effect from a date not less than five Banking Days after the receipt by the Payment Agent of such notice the whole or any part (being five hundred thousand Dollars (USD 500,000) or any larger sum which is an integral multiple of five hundred thousand Dollars (USD 500,000) of the Revolving Facility. Any such notice of cancellation, once given, shall be irrevocable and the aggregate Commitments shall be reduced accordingly.

The Borrower may also at any time during the Facility Period by notice to the Payment Agent (effective only on actual receipt) prepay and cancel with effect from a date not less than fifteen (15) days after receipt by the Payment Agent of such notice, the whole but not part only, but without prejudice to the Borrower’s obligations under clauses 6.6 and 12, of the Contribution and Commitment (if any) of any Lender to which the Borrower shall have become obliged to pay additional amounts under clause 12 or clause 6.6. Upon any notice of such prepayment and cancellation being given, the Commitment of the relevant Lender shall be reduced to zero, the Borrower shall be obliged to prepay the Contribution of such Lender and such Lender’s related costs (including but not limited to Break Costs)

 

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on such date and such Lender shall be under no obligation to participate in the Loan or any further Advances.

Without prejudice to the Borrower’s obligations under clause 8.1.4, no Bank shall have any responsibility for the application of the proceeds of any Advance or any part thereof by the Borrower.

The Borrower must pay interest on each Advance and the Loan in respect of each Interest Period relating thereto on each Interest Payment Date at the rate per annum determined by the Payment Agent to be the aggregate of (i) in respect of Interest Periods of 12 months or less (a) the Applicable Margin and (b) LIBOR or (ii) in respect of Interest Periods of more than 12 months (a) the applicable Margin, (b) (in respect of each Contribution) the actual cost of funds to that Lender to fund its Contribution and (c) Mandatory Costs (if any).

Subject to clause 3.3, the Borrower may by notice received by the Payment Agent not later than 10:00 a.m. on the fourth Banking Day before the beginning of each Interest Period specify whether such Interest Period shall have a duration of three (3), six (6), nine (9) or twelve (12) months or such other period as the Borrower may select and the Payment Agent (acting on the instructions of the Lenders) may agree, and if the Borrower wishes to specify an Interest Period of more than 12 months, it must give at least 5 Banking Days prior notice thereof.

Subject to Clause 3.3.1 every Interest Period shall be of the duration specified by the Borrower pursuant to clause 3.2 but so that:

 

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If the Borrower fails 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, the Borrower must 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 Payment Agent pursuant to this clause 3.4. The period starting 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 Payment Agent each of which (other than the first, which shall start on such due date) shall start 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 Payment Agent) of (a) two per cent (2%) per annum, (b) the Applicable Margin (which shall be for the purposes of this Clause, 1.25% per annum) and (c) LIBOR for such periods. Such interest shall be due and payable on demand, or, if no demand is made, then on the last day of each such period as determined by the Payment Agent and on the day on which all amounts in respect of which interest is being paid under this Clause are paid, and each such day shall, for the purposes of this Agreement,

 

 

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be treated as an Interest Payment Date, provided that if such unpaid sum is an amount of principal which became due and payable by reason of a declaration by the Payment Agent under clause 10.2.2 or a prepayment pursuant to clauses 4.3, 4.5, 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 Payment 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. If, for the reasons specified in clause 3.6.1, the Payment Agent is unable to determine a rate in accordance with the foregoing provisions of this clause 3.4, each Lender shall promptly notify the Payment Agent of the cost of funds to such Lender and interest on any sum not paid on its due date for payment shall be calculated at a rate determined by the Payment Agent to be two per cent (2%) per annum above the aggregate of the Applicable Margin and the arithmetic mean of the cost of funds to the Lenders compounded at such intervals as the Payment Agent selects.

The Payment Agent shall on 31 March 2008 and every three months thereafter calculate the Applicable Margin for the following three months and the Payment Agent shall make such calculations by reference to valuations obtained under or in accordance with Clause 8.2.2(a) and the Payment Agent agrees to notify (i) the Lenders promptly of the duration of each Interest Period and (ii) the Borrower and the Lenders promptly of each rate of interest determined by it under this clause 3.5.

 

 

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(a)	if all three Advances are made available or if less than the Total Commitments are made available but nevertheless “FANTASTIKS” is subject to a Mortgage,

 

 

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Subject to clauses 4.3, 4.4, 4.5 and 4.6 the Borrower may, subject to having given 5 Banking Days prior notice thereof to the Payment Agent, prepay any specified amount (such part being in an amount of five hundred thousand Dollars (USD 500,000) or any larger sum which is an integral multiple of such amount) of the Loan on any relevant Interest Payment Date without premium or penalty.

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

 

 

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

 

 

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The Borrower shall pay to the Payment Agent (i) a non-refundable agency fee of USD20,000 per annum for the account of the Agent and the Payment Agent in such proportion as they shall agree between them, such fee being payable in advance on the Execution Date and annually thereafter and (ii) all amounts required to be paid in accordance with a fee letter bearing even date with this Agreement.

The Borrower agrees to reimburse the Banks on a full indemnity basis within ten (10) days of demand all expenses and/or disbursements whatsoever (including without limitation legal, printing, travel and out of pocket expenses and expenses related to the provision of legal and insurance opinions referred to in schedule 4) certified by the Banks or any of them as having been incurred by them from time to time:

together with interest at the rate referred to in clause 3.4 from the date on which reimbursement of such expenses and/or disbursements were due following demand to the date of payment (as well after as before judgment).

 

 

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All fees and expenses payable pursuant to this Agreement must be paid together with value added tax or any similar tax (if any) properly chargeable thereon in any jurisdiction. Any value added tax chargeable in respect of any services supplied by the Banks 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.

The Borrower must pay all stamp, documentary, registration or other like duties or taxes (including any duties or taxes payable by any of the Banks) imposed on or in connection with any of the Underlying Documents, the Security Documents or the Loan or any Advance and agree to indemnify the Banks or any of them against any liability arising by reason of any delay or omission by the Borrower to pay such duties or taxes.

 

All payments to be made by the Borrower under any of the Security Documents must 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 USD on or before 11:00 am on the due date in freely available funds to such account at such bank and in such place as the Payment Agent may from time to time specify for this purpose. Save as otherwise provided in this Agreement or any other relevant Security Documents, such payments shall be for the account of all Lenders and the Payment Agent shall distribute such payments in like funds as are received by the Payment Agent to the Lenders rateably, in the proportions which their respective Contributions bear to the aggregate of the Loan and the Advances on the date on which such payment is made.

All sums to be advanced by the Lenders to the Borrower under this Agreement shall be remitted in USD on the relevant Drawdown Date to the account of the Payment Agent at such bank as the Payment Agent may have notified to the Lenders and shall be paid by the Payment Agent on such date in like funds as are received by the Payment Agent to the account specified in the relevant Drawdown Notice.

 

 

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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.

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

If any sum due from the Borrower under any of the Security Documents, or under any order or judgment given or made in relation thereto, must be converted from the currency (“the first currency”) in which the same is payable thereunder into another currency (“the second currency”) for the purpose of (i) making or filing a claim or proof against the Borrower, (ii) obtaining an order or judgment in any court or other tribunal or (iii) enforcing any order or judgment given or made in relation thereto, the Borrower undertakes to indemnify and hold harmless the Lender from and against any loss suffered as a result of any discrepancy between (a) the rate of exchange used for such purpose to convert the sum in question from the first currency into the second currency and (b) the rate or rates of exchange at which the Lender 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 Borrower under this clause 6.5 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.

 

 

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6.6	Grossing-up for Taxes - by the Borrower

If at any time the Borrower must make any deduction or withholding in respect of Taxes or otherwise from any payment due under any of the Security Documents for the account of any Bank or if the Payment Agent or the Security Trustee must make any deduction or withholding from a payment to another Bank or withholding in respect of Taxes from any payment due under any of the Security Documents, the sum due from the Borrower in respect of such payment must be increased to the extent necessary to ensure that, after the making of such deduction or withholding, the relevant Bank receives on the due date for such payment (and retains, free from any liability in respect of such deduction or withholding), a net sum equal to the sum which it would have received had no such deduction or withholding been required to be made and the Borrower must indemnify each Bank against any losses or costs incurred by it by reason of any failure of the Borrower 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 Borrower must promptly deliver to the Payment Agent any receipts, certificates or other proof evidencing the amounts (if any) paid or payable in respect of any deduction or withholding as aforesaid.

If at any time a Lender must make any deduction or withholding in respect of Taxes from any payment due under any of the Security Documents for the account of the Payment Agent or the Security Trustee, the sum due from such Lender in respect of such payment must be increased to the extent necessary to ensure that, after the making of such deduction or withholding, the Payment Agent or, as the case may be, the Security Trustee 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 Lender must indemnify the Payment Agent and the Security Trustee against any losses or costs incurred by it by reason of any failure of such Lender to make any such deduction or withholding or by reason of any increased payment not being made on the due date for such payment.

Each Lender 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 Payment Agent and/or the Security Trustee shall maintain a control account showing the

 

 

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Loan, the Advances and other sums owing by the Borrower 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 prima facie evidence of the amount from time to time owing by the Borrower under the Security Documents.

Where any sum is to be paid under the Security Documents to the Payment Agent or, as the case may be, the Security Trustee for the account of another person, the Payment Agent or, as the case may be, the Security Trustee may assume that the payment will be made when due and the Payment Agent or, as the case may be, the Security Trustee 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 Payment Agent or, as the case may be, the Security Trustee, then the person to whom such sum was so made available must on request refund such sum to the Payment Agent or, as the case may be, the Security Trustee together with interest thereon sufficient to compensate the Payment Agent or, as the case may be, the Security Trustee for the cost of making available such sum up to the date of such repayment and the person by whom such sum was payable must indemnify the Payment Agent or, as the case may be, the Security Trustee for any and all loss or expense which the Payment Agent or, as the case may be, the Security Trustee may sustain or incur as a consequence of such sum not having been paid on its due date.

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

 

 

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The order of application set out in clauses 6.10.1 to 6.10.6 may be varied by the Payment Agent if the Majority Lenders so direct, without any reference to, or consent or approval from, the Borrower.

 

The Borrower represents and warrants to each Bank that:

each of the Security Parties are duly incorporated or formed, as the case may be, and validly existing in good standing, under the laws of its respective country of incorporation or formation, in each case, as a limited partnership, limited liability company or corporation as the case may be, and has power to carry on its respective businesses as it is now being

 

 

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conducted and to own their respective property and other assets to which it has unencumbered legal and beneficial title except as disclosed to the Agent in writing;

each of the Security Parties has power to execute, deliver and perform its obligations and, as the case may be, to exercise its rights under the Underlying Documents and the Security Documents to which it is a party; all necessary limited partnership, limited liability company, corporate, partner, member, shareholder and other action has been taken to authorise the execution, delivery and on the execution of the Security Documents performance of the same and no limitation on the powers of the Borrower to borrow or any other Security Party to howsoever incur liability and/or to provide or grant security will be exceeded as a result of borrowing any part of the Loan;

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

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

no Default has occurred;

 

 

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no Proceedings are current, pending or, to the knowledge of the officers of the Borrower, threatened against any of the Security Parties or any other Group Members or their assets which could have a Material Adverse Effect and there exist no judgments, orders, injunctions which would materially affect the obligations of the Security Parties under the Security Documents;

except for the registration of the Mortgages in the relevant register 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 Pertinent Jurisdiction or that any stamp, registration or similar tax or charge be paid in any Pertinent 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 Pertinent Jurisdiction;

all Required Authorisations have been obtained or effected and are in full force and effect and no Security Party has in any way contravened any applicable law, statute, rule or regulation (including all such as relate to money laundering);

the choice of English law to govern the Underlying Documents and the Security Documents (other than the Mortgages, the Charter Account Pledges, the Earnings Account Pledge and the Retention Account Pledge), the choice of the law of the Flag State to govern the Mortgages, the choice of German law to govern the Charter Account Pledges, the Earnings Account Pledge and the Retention Account Pledge and the submissions by the Security Parties to the jurisdiction of the English courts and the obligations of such Security Parties associated therewith, are valid and binding;

 

 

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no Security Party nor any of their assets is entitled to immunity on the grounds of sovereignty or otherwise from any Proceedings whatsoever;

the latest audited and unaudited consolidated financial statements of the Borrower in respect of the relevant financial year as delivered to the Agent present or will present fairly and accurately the financial position of the Borrower and the consolidated financial position of the Group as at the date thereof and the results of the operations of the Borrower and the consolidated results of the operations of the Group for the financial year ended on such date and, as at such date, neither the Borrower nor any of its subsidiaries had any significant liabilities (contingent or otherwise) or any unrealised or anticipated losses which are not disclosed by, or reserved against or provided for in, such financial statements;

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

all information, whatsoever provided by any Security Party to the Banks in connection with the negotiation and preparation of the Security Documents or otherwise provided hereafter in relation to, or pursuant to this Agreement is, or will be, true and accurate in all material respects and not misleading, does or will not omit material facts and all reasonable enquiries have been, or shall have been, made to verify the facts and statements contained therein; there are, or will be, no other facts the omission of which would make any fact or statement therein misleading;

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

 

 

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Documents or any other document or instrument to be executed or delivered under any of the Security Documents;

the Borrower shall apply the Loan only for the purposes specified in clause 2.1;

throughout the Facility Period (or, as the case may be, from their acquisition by the relevant Owner) each Mortgaged Vessel will be :

except with the prior written consent of the Agent (acting on the instructions of the Majority Lenders), there will not be any agreement or arrangement whereby the Earnings (as defined in the relevant Ship Security Documents) of any Mortgaged Vessel or any Chartered Vessel receivable by a Charterer may be shared or pooled howsoever with any other person;

no Mortgaged Vessel nor its Earnings, Insurances or Requisition Compensation (each as defined in the relevant Ship Security Documents) nor the Earnings Account, either Charter Acccount or the Retention Account nor any Extended Employment Contract in respect of such Mortgaged Vessel or Existing Charter or Existing Charter-out or Existing Charter-in 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 subject to any Encumbrance except Permitted Encumbrances;

 

 

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

each of the Owners has complied with and continues to comply with and has procured that the Manager has complied with and continues to comply with the ISM Code, the ISPS Code and all other statutory and other requirements relative to its business and in particular each Owner or the Manager has obtained and maintains a valid DOC and SMC for each Vessel and that it and the Manager has implemented and continues to implement an ISM SMS;

the Certified Copies or originals of the Underlying Documents delivered or to be delivered to the Agent pursuant to clause 9.1 are, or will when delivered be, true and complete copies or, as the case may be, originals of such documents; and such documents constitute valid and binding obligations of the parties thereto enforceable in accordance with their respective terms and there have been no amendments or variations thereof or defaults thereunder:

 

 

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On each day throughout the Facility Period, the Borrower shall be deemed to repeat the representations and warranties in clause 7 updated mutatis mutandis as if made with reference to the facts and circumstances existing on such day.

 

The Borrower undertakes with each Bank that, from the Execution Date until the end of the Facility Period, it will:

promptly inform the Agent of (a) any circumstances or occurrence which might adversely affect the ability of any Security Party to perform its obligations under any of the Security Documents and (b) as soon as the same is instituted or threatened, details of any Proceedings involving any Security Party which could have a material adverse effect on that Security Party and/or the operation of any of the Mortgaged Vessels (including, but not limited to any Total Loss of a Vessel or the occurrence of any Environmental Incident) and will from time to time, if so requested by the Agent, confirm to the Agent in writing that, save as otherwise stated in such confirmation, no Default has occurred and is continuing and no such Proceedings are on foot or threatened;

obtain or cause to be obtained, maintain in full force and effect and comply fully with all Required Authorisations, provide the Agent with Certified Copies of the same and do, or cause to be done, all other acts and things which may from time to time be necessary or desirable under any applicable law (whether or not in the Pertinent Jurisdiction) for the continued due performance of all the obligations of the Security Parties under each of the Security Documents;

 

 

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ensure that each Security Party maintains its existence as a limited partnership, limited liability company or body corporate, as the case may be, duly organised and validly existing and in good standing under the laws of the Pertinent Jurisdiction;

use the Advances exclusively for the purposes specified in clauses 1.1 and 2.1;

ensure that their obligations under this Agreement and the Master Agreements shall 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;

send to the Agent (or procure that is sent):

Whether or not any amount is borrowed under this Agreement, reimburse the Security Trustee on the Security Trustee’s written demand the amount of the premium payable by the

 

 

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Security Trustee for the inception or, as the case may be, extension and/or continuance of the MII & MAP Policy (including any insurance tax thereon);

deliver to the Agent on the earlier of (i) the date on which the quarterly reports are delivered under clause 8.1.6 and (ii) the date falling 75 days after the end of the financial quarter to which they refer, a Compliance Certificate together with such supporting information as the Agent may require.

provide the Agent, and procure that the Guarantors and the General Partner provide the Agent, with such financial or other information concerning the Borrower and their respective affairs, activities, financial standing, Indebtedness and operations and the performance of the Mortgaged Vessels as the Agent or any Lender (acting through the Agent) may from time to time reasonably reasonably require and all other documentation and information as any Lender may from time to time require in order to comply with its, and all other relevant, know-your-customer regulations;

duly and punctually perform each of the obligations expressed to be imposed or assumed by them under the Security Documents and Underlying 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;

and will procure that any Operator will, comply with and ensure that the Vessels and any Operator complies with the requirements of the ISM Code, including (but not limited to) the maintenance and renewal of valid certificates pursuant thereto throughout the Security Period (as defined in the Mortgages);

 

 

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Immediately inform the Agent if there is any actual withdrawal of their or any Operator’s DOC or the SMC of any Vessel;

and will procure that any Operator will promptly inform the Agent of the receipt by any Owner or any Operator of notification that its application for a DOC or any application for an SMC for any Vessel has been refused;

and will procure that the Manager or any Operator will:

and will comply with all relevant Environmental Laws, laws, statutes and regulations and pay all taxes for which it is liable as they fall due;

deliver to the Agent, a Certified Copy of each Extended Employment Contract upon its execution, (ii) forthwith on the request of the Agent (acting on the instructions of the Majority Lenders) execute (a) a Charter Assignment in respect thereof and (b) any notice of assignment required in connection therewith and use reasonable efforts to procure the acknowledgement of any such notice of assignment by the relevant charterer (provided that any failure to procure the same shall not constitute an Event of Default) and (iii) pay all legal and other costs incurred by any Bank in connection with any such Charter Assignments, forthwith following the Agent’s demand.

 

 

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Forthwith upon the written request of the Agent (acting on the instructions of the Majority Lenders), deliver to the Agent or the relevant Lender such Shares Pledges as the Agent or the relevant Lender shall specify, each duly executed by the Shareholder together with documentation equivalent to that referred to in Part 1 of Schedule 4 at items (a)-(d) (inclusive) in respect of the Shareholder and together with all other documentation required to be delivered pursuant to the terms thereof and the Borrower shall pay all legal and other costs incurred by any Bank in relation thereto.

procure that

the Agent, at the cost of the Borrower and upon receipt of at least 15 days written notice, by surveyors or other persons appointed by it for such purpose, to board any Mortgaged Vessel at all other reasonable times for the purpose of inspecting her and to afford all proper facilities for such inspections and for this purpose to give the Agent reasonable advance notice of any intended drydocking of each Vessel (whether for the purpose of classification, survey or otherwise) and to pay the costs in respect of one inspection in each calendar year; and

 

 

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Maintain at all times a minimum Estimated Maintenance and Replacement Capital Expenditure Reserve (as defined in the Registration Statement in form F1 dated 12 November 2007 filed in respect of the Borrower under the US Securities act 1933) as the directors of the Borrower may from time to time approve or require.

Ensure that all Indebtedness of the Borrower to its shareholders or any of them is fully subordinated, and to subordinate any Indebtedness issued to it by any Guarantor, all in a form acceptable to the Agent (acting on the instructions of the Majority Lenders).

If, at any time after the first Drawdown Date, the Security Value shall be less than the Required Security Amount, the Agent (acting on the instructions of the Majority Lenders) shall give notice to the Borrower requiring that such deficiency be remedied and then the Borrower must either:

The provisions of clauses 4.6 and 4.7 shall apply to prepayments under clause 8.2.1(a) provided that the amounts in the applicable one of the Loan Amount Outstanding columns shall be reduced by the Repayment Proportion of such amount (where “Prepayment Proportion” means the amount of the prepayment being made under this clause 8.2.1 divided

 

 

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by the amount of the Loan immediately prior to such prepayment) and the amounts of the Loan prepaid hereunder shall not be available to be re-borrowed.

Each Mortgaged Vessel shall, for the purposes of this Agreement, be valued (at the Borrower’s expense) in USD by taking the average of valuations prepared by any two Approved Brokers appointed by the Agent, such valuations to be made without physical inspection, and on the basis of a sale for prompt delivery for cash at arms’ length, on normal commercial terms, as between a willing buyer and a willing seller, without taking into account the benefit or burden of any charterparty or other engagement concerning the relevant Mortgaged Vessel provided that if such two valuations vary by more than 15% then the Agent shall appoint a third Approved Broker to provide a valuation and the Valuation amount shall be the average of such three valuations, such valuations to be obtained:

The Approved Broker’s valuations for each Mortgaged Vessel on each such occasion shall constitute the Valuation Amount of such Mortgaged Vessel for the purposes of this Agreement until superceded by the next such valuation.

The Borrower undertakes with the Banks to supply to the Agent and to the Approved Broker such information concerning the relevant Mortgaged Vessel and its condition as such shipbrokers may require for the purpose of determining any Valuation Amount.

All costs in connection with the obtaining and any determining of any Valuation Amount pursuant to Clause 8.2.2 and any valuation either of any additional security for the purposes of ascertaining the Security Value at any time or necessitated by the Borrower electing to constitute additional security pursuant to clause 8.2.1(b), must be paid by the Borrower.

 

 

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For the purposes of this clause 8.2, the market value (i) of any additional security over a ship (other than the Vessels) shall be determined in accordance with clause 8.2.2 and (ii) of any other additional security provided or to be provided to the Banks or any of them shall be determined by the Agent in its absolute discretion.

In connection with any additional security provided in accordance with this clause 8.2, the Agent shall be entitled to receive (at the Borrower’s expense) such evidence and documents of the kind referred to in schedule 4 as may in the Agent’s opinion be appropriate and such favourable legal opinions as the Agent shall in its absolute discretion require.

The Borrower undertakes with each Bank that, from the Execution Date until the end of the Facility Period, it will not, without the prior written consent of the Agent (acting on the instructions of the Majority Banks):

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

merge or consolidate with any other person or permit any change to the legal or beneficial ownership of (a) any Security Party’s shares from that existing at the Execution Date and (b) any of the shares of the Borrower which would give rise to an Event of Default under Clause 10.1.29;

sell, transfer, assign, create security or option over, pledge, pool, 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 for full

 

 

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consideration in the ordinary course of trading) whether by one or a series of transactions related or not which could have a material (in the reasonable opinion of the Lenders) adverse affect on the ability of the Borrower to perform its obligations under this Agreement;

undertake any business other than the ownership, chartering-in, chartering-out and operation of ships or permit the owners of the Mortgaged Vessels to employ anyone other than the Manager as commercial and technical manager of any Vessel;

permit any Guarantor (other than the Shareholder) to acquire any further assets;

incur any obligations with Navios GP, any Guarantor, any Charterer or other company in the Group or associated company of any of them except for obligations arising under the Security Documents, under the Omnibus Agreement or contracts reasonably entered into in the ordinary course of business with such person;

incur any Indebtedness except for Indebtedness pursuant to the Security Documents or otherwise with the consent of the Lenders (which consent shall not be unreasonably withheld);

repay or prepay the principal of, or pay interest on or any other sum in connection with any Indebtedness except for Indebtedness permitted pursuant to Clause 8.3.7 or pursuant to the Security Documents;

issue any guarantees or otherwise become directly or contingently liable for the obligations of any person, firm, or corporation except (i) pursuant to the Security Documents, (ii) in relation to the normal business of the Borrower for a contingent aggregate liability of up to

 

 

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USD500,000 per calendar year or (iii) otherwise with the consent of the Lenders (which consent shall not be unreasonably withheld);

make any loans or grant any credit to any person or agree to do so;

purchase or otherwise acquire for value any partnership interest, membership interest or shares of their capital, as the case may be, or declare or pay any dividends or distribute any of their present or future assets, undertakings, rights or revenues to any of their partners, members or shareholders, as the case may be, except the Borrower may re-purchase any of its partnership interest or make any distributions to its partners only (i) if there has not occurred any Event of Default and (ii) no Event of Default would occur as a result of such payment;

Permit any Guarantor (other than Shareholder) to form or acquire any Subsidiaries;

 

 

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The obligation of each Lender to make its Commitment available in respect of any Advance is conditional upon:

The obligation of each Lender to make its Commitment available in respect of Advance A is conditional upon:

 

 

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The obligation of each Lender to make its Commitment available in respect of Advance B is conditional upon:

The obligation of each Lender to make its Commitment available in respect of Advance C is conditional upon:

The conditions specified in this clause 9 are inserted solely for the benefit of the Lenders and may be waived by the Agent in whole or in part and with or without conditions only with the consent of the Majority Lenders.

 

 

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Not later than five (5) Banking Days prior to the Drawdown Date of an Advance and not later than five (5) Banking Days prior to any Interest Payment Date, the Agent (acting on the instructions of the Majority Lenders) may request and the Borrower must, not later than two (2) Banking Days prior to such date, deliver to the Agent (at the Borrower’s expense) on such request further favourable certificates and/or opinions as to any or all of the matters which are the subject of clauses 7, 8, 9 and 10.

Each of the following events shall constitute an Event of Default (whether such event shall occur voluntarily or involuntarily or by operation of law or regulation or in connection with any judgment, decree or order of any court or other authority or otherwise, howsoever):

 

 

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of remedy, in which case the same shall constitute an Event of Default if it has not been remedied within fifteen (15) days of the occurrence thereof; or

 

 

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or an order is made or resolution passed for the dissolution or winding up of any Security Party or a notice is issued convening a meeting for such purpose; or

 

 

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a material adverse effect (i) on the business, assets or financial condition of any Security Party or the Group taken as a whole or (ii) on the security constituted by any of the Security Documents or the enforceability of that security in accordance with its terms; or

 

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Agreement or (ii) an Early Termination Date (as defined in either Master Agreement) has occurred or been effectively designated under the relevant Master Agreement or (iii) a person entitled to do so gives notice of an Early Termination Date (as defined in either Master Agreement) or (iv) either Master Agreement is terminated, cancelled, suspended, rescinded or revoked or otherwise ceases to remain in full force and effect for any reason

PROVIDED THAT that there shall not be an Event of Default solely by reason of any of the events or circumstances described in clauses 10.1.5 to 10.1.15 inclusive taking place with respect to any Group Member which is not a Security Party unless in the opinion of the Majority Lenders, the ability of any Security Party to perform all or any of the obligations expressed to be assumed by it under, or otherwise to comply with the terms of, the Security Documents which it is a party would be materially and adversely affected.

The Agent may, and if so requested by the Majority Lenders shall, without prejudice to any other rights of the Lenders, at any time after the happening of an Event of Default by notice to the Borrower declare that:

If, under clause 10.2.2, the Agent has declared the Loan to be due and payable on demand, at any time thereafter the Agent may (and if so instructed by the Majority Lenders shall) by written notice to the Borrower (a) demand repayment of the g Loan on such date as may be specified whereupon, regardless of any other provision of this Agreement, the Loan shall become due and payable on the date so specified together with all interest accrued and all other sums payable under this Agreement or (b) withdraw such declaration with effect from the date specified in such notice.

 

 

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The Borrower agrees to indemnify each Bank on demand, without prejudice to any of such Bank’s other rights under any of the Security Documents, against any loss (including loss of Applicable Margin) or expense (including, without limitation, Break Costs) which such Bank shall certify as sustained by it as a consequence of any Default, any prepayment of the Loan being made under clauses 4.3, 4.5, 8.2.1(a) or 12.1 or any other repayment or prepayment of the Loan or part thereof being made otherwise than on an Interest Payment Date relating to the part of the Loan prepaid or repaid; and/or any Advance not being made for any reason (excluding any default by the Payment Agent, the Agent or any Lender) after the Drawdown Notice for such Advance has been given.

The Borrower shall indemnify each Bank on demand and hold it harmless from and against all costs, claims, expenses, payments, charges, losses, demands, liabilities, actions, Proceedings, penalties, fines, damages, judgements, orders, sanctions or other outgoings of whatever nature which may be incurred or made or asserted whensoever against such Bank at any time, whether before or after the repayment in full of principal and interest under this Agreement, arising howsoever out of an Environmental Claim made or asserted against such Bank which would not have been, or been capable of being, made or asserted against such Bank had it not entered into any of the Security Documents or been involved in any of the resulting or associated transactions.

The Borrower shall promptly indemnify each Lender on demand against any cost incurred or loss suffered by such Lender as a result of its complying with (i) the minimum reserve requirements from time to time of the European Central Bank (ii) any capital adequacy directive of the European Union and/or (iii) any revised framework for international convergence of capital measurements and capital standards and/or any regulation imposed by any Government Entity in connection therewith, and/or in connection with maintaining required reserves with a relevant national central bank to the extent that such compliance or maintenance relates to such Lender’s Commitment and/or Contribution or deposits obtained by it to fund the whole or part thereof and to the extent such cost or loss is not recoverable by such Lender under clause 12.2.

 

 

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If it is or becomes contrary to any law, directive or regulation for any Lender to contribute to an Advance or to maintain its Commitment or fund its Contribution to the Loan or any Advance, such Lender shall promptly, through the Agent, give notice to the Borrower whereupon (a) such Lender’s Contribution and Commitment shall be reduced to zero and (b) the Borrower shall be obliged to prepay such Lender’s Contribution either (i) forthwith or (ii) on a future specified date not being earlier than the latest date permitted by the relevant law, directive or regulation together with interest accrued to the date of prepayment and all other sums payable by the Borrower under this Agreement.

If the result of any change in, or in the interpretation or application of, or the introduction of, any law or any regulation, request or requirement (whether or not having the force of law, but, if not having the force of law, with which a Lender or, as the case may be, its holding company habitually complies), including (without limitation) those relating to Taxation, capital adequacy, liquidity, reserve assets, cash ratio deposits and special deposits, is to:

 

 

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

For the purposes of this clause 12.2 “holding company” means the company or entity (if any) within the consolidated supervision of which a Lender is included.

Nothing in clause 12.2 shall entitle any Lender 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.

 

 

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All moneys received by the Payment Agent and/or the Security Trustee 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 Trustee’s or (as the case may be) the Payment Agent’s discretion, shall be applied in the following manner:

 

 

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

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

 

 

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The Borrower undertakes with each Bank that the Security Documents shall both at the date of execution and delivery thereof and throughout the Facility Period be valid and binding obligations of the respective parties thereto which, with the rights of each Lender thereunder, are 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 Lenders may be necessary or desirable for perfecting the security contemplated or constituted by the Security Documents.

In the event of any conflict between this Agreement and any of the other Security Documents, the provisions of this Agreement shall prevail.

No failure or delay on the part of any of the Banks 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 any Bank of any power, right or remedy preclude any other or further exercise thereof or the exercise of any other power, right or remedy. The remedies provided in the Security Documents are cumulative and are not exclusive of any remedies provided by law. No waiver by any Bank shall be effective unless it is in writing.

If any provision of this Agreement is prohibited, invalid, illegal or unenforceable in any jurisdiction, such prohibition, invalidity, illegality or unenforceability shall not affect or impair howsoever the remaining provisions thereof or affect the validity, legality or enforceability of such provision in any other jurisdiction.

Regardless of any other provision of this Agreement, none of the Banks shall be liable for any failure to perform the whole or any part of this Agreement resulting directly or indirectly from (i) the action or inaction or purported action of any governmental or local authority (ii) any strike, lockout, boycott or blockade (including any strike, lockout, boycott or blockade

 

 

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effected by or upon the Bank or any of its representatives or employees) (iii) any act of God (iv) any act of war (whether declared or not) or terrorism (v) any failure of any information technology or other operational systems or equipment affecting the Bank or (vi) any other circumstances whatsoever outside the Bank’s control.

This Agreement may be amended or varied only by an instrument in writing executed by all parties hereto who irrevocably agree that the provisions of this clause 13.11 may not be waived or modified except by an instrument in writing to that effect signed by both of them.

This Agreement may be executed in any number of counterparts and all such counterparts taken together shall be deemed to constitute one and the same agreement which may be sufficiently evidenced by one counterpart.

All documents required to be delivered under and/or supplied whensoever in connection howsoever with any of the Security Documents and all notices, communications, information and other written material whatsoever given or provided in connection howsoever therewith must either be in the English language or accompanied by an English translation certified by a notary, lawyer or consulate acceptable to the Agent.

The Borrower undertakes with each Bank that it will ensure that:

 

 

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the moneys paid to the Earnings Account or a Charter Account are payable in a currency other than USD, they shall be paid to a sub-account of the Earnings Account or Charter Account denominated in such currency (except that if the Shareholder fails to open such a sub-account, the Account Bank shall then convert such moneys into USD at the Account Bank’s spot rate of exchange at the relevant time for the purchase of USD with such currency and the term “spot rate of exchange” shall include any premium and costs of exchange payable in connection with the purchase of USD with such currency).

Any sums standing to the credit of the Earnings Account or a Charter Account may be applied from time to time (i) Firstly and to make the payments required under this Agreement, (ii) secondly subject to there being no breach of Clause 14.3 and to no Event of Default having occurred, in the operation of the Mortgaged Vessels and (iii) subject to there being at any time sufficient funds to pay amounts due under (i) and (ii) above as they fall due, thirdly for the general corporate purposes of the Borrower.

 

 

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Unless the Agent (acting on the instructions of the Majority Banks) otherwise agrees in writing and subject to this clause 14.3.2, Borrower shall not be entitled to withdraw any moneys from the Retention Account at any time during the Facility Period.

At any time after the occurrence of an Event of Default, the Payment Agent may (and on the instructions of the Majority Lenders shall), without notice to the Borrower, instruct the Account Bank to apply all moneys then standing to the credit of the Earnings Account and/or the Retention Account and/or a Charter Account (together with interest from time to time accruing or accrued thereon) in or towards satisfaction of any sums due to the Banks or any of them under the Security Documents in the manner specified in clause 13.1.

The Earnings Account, the Charter Accounts and the Retention Account and all amounts from time to time respectively standing to the credit thereof shall be subject to the security constituted and the rights conferred by, respectively, the Earnings Account Pledge, the Charter Account Pledges and the Retention Account Pledge.

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

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

Provided that there may be no more than 5 Lenders at any one time, any Lender (the “Transferor Lender”) may at any time cause all or any part of its rights, benefits and/or obligations under this Agreement and the other Security Documents to be transferred to another first class international bank or financial institution (in either case a “Transferee Lender”) by delivering to the Agent a Transfer Certificate duly completed and duly executed by the Transferor Lender and the Transferee Lender. No such transfer is binding on, or

 

 

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effective in relation to, the Borrower or the Agent 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 Lender, the Transferee Lender and the Agent (on behalf of itself, the Borrower and the other Banks) and (ii) such transfer of rights under the other Security Documents has been effected and registered. 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:

 

 

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those about pro-rata sharing and the exclusion of liability on the part of, and the indemnification of, the Arrangers, the Payment Agent and the Agent and the Security Trustee and to the extent that the Transferee Lender becomes bound by those provisions, the Transferor Lender ceases to be bound by them;

 

 

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each Lender was transferred to such Lender, and the Payment Agent shall make the said register available for inspection by any Lender or the Borrower during normal banking hours upon receipt by the Payment Agent of reasonable prior notice requesting the Payment Agent to do so.

Any Transferor Lender who causes the transfer of all or any part of its rights, benefits and/or obligations under the Security Documents in accordance with the foregoing provisions of this clause 15, must, on each occasion, pay to the Agent a transfer fee of one thousand five hundred Dollars (USD 1,500) and, in addition, be responsible for all other costs and expenses (including, but not limited to, reasonable legal fees and expenses) associated therewith and all value added tax thereon, as well as those of the Agent (in addition to its fee as aforesaid) in connection with such transfer.

If any Lender 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 Borrower undertakes, immediately on being requested to do so by the Agent and at the cost of the Transferor Lender, to enter into, and procure that the other Security Parties shall (at the cost of the Transferor Lender) enter into, such documents as may be necessary or desirable to transfer to the Transferee Lender all or the relevant part of such Lender’s interest in the Security Documents and all relevant references in this Agreement to such Lender shall thereafter be construed as a reference to the Transferor Lender and/or its Transferee Lender (as the case may be) to the extent of their respective interests.

A Lender may sub-participate all or any part of its rights and/or obligations under the Security Documents at its own expense without the consent of, or notice to, the Borrower.

 

 

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Each Lender 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 Lender selected from time to time by it through which such Lender wishes to lend for the purposes of this Agreement. If the office through which a Lender is lending is changed pursuant to this clause 15.8, such Lender shall notify the Agent promptly of such change and the Agent shall notify the Borrower, the Security Trustee, the Payment Agent, the Account Bank and the other Lenders.

A Bank may disclose to and of its branches and affiliates, its head office, any relevant fiscal authorities. a prospective assignee, transferee or to any other person who may propose entering into contractual relations with such Bank in relation to this Agreement and/or the Master Agreement such information about the Borrower and/or the other Security Parties and/or the Loan and/or the Security Documents as such Bank shall consider appropriate in relation to any transfer and/or enforcement hereunder.

Each Swap Bank and each Lender irrevocably appoints the Agent and the Payment Agent as its agent and payment agent respectively for the purposes of this Agreement and such of the Security Documents to which it may be appropriate for the Agent to be party. Accordingly each of the Lenders and each Swap Bank hereby authorise the Agent and the Payment Agent:

Any action taken by the Agent or the Payment Agent under or in relation to any of the Security Documents whether with requisite authority or on the basis of appropriate

 

 

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instructions received from the Majority Lenders (or as otherwise duly authorised) shall be binding on all the Banks.

The Agent and the Payment Agent may:

 

 

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None of the Arrangers, the Agent, the Payment Agent nor any of their respective employees and agents shall:

 

 

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For the purposes of this clause 16, none of the Arrangers nor the Agent or the Payment 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 or the Payment 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 or Payment 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.

Each Lender and each Swap Bank acknowledges that it has not relied on any statement, opinion, forecast or other representation made by either Arranger, the Agent or the Payment Agent to induce it to enter into any of the Security Documents and that it has made and will continue to make, without reliance on either Arranger, the Agent or the Payment 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 Lender’s Commitment or Contribution under this Agreement. None of the Arrangers, the Payment Agent and the Agent shall have any duty or responsibility, either initially or on a continuing basis, to provide any Lender or a Swap Bank with any credit or other information with respect to any Security Party whether coming into its possession before the making of any Advance or the Loan or at any time or times thereafter other than as provided in clause 16.3.1.

 

 

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None of the Arrangers, the Agent or the Payment Agent shall have any responsibility or liability to any Lender or a Swap Bank:

Each of the Arrangers, the Payment Agent 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 the relevant Arranger’s or, as the case may be, the Agent’s or Payment Agent’s employment).

 

 

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Each of the Arrangers, the Payment Agent and the Agent may, without any liability to account to the Lenders, 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 company in the same group of companies as such Security Party or any of the Lenders as if it were not an Arranger or, as the case may be, the Agent or Payment Agent.

With respect to its own Commitment and Contribution (if any) the Agent and the Payment Agent shall have the same rights and powers under the Security Documents as any other Lender and may exercise the same as though it were not performing the duties and functions delegated to it under this Agreement and the term “Lenders” shall, unless the context clearly otherwise indicates, include the Agent and the Payment Agent in their respective individual capacity as a Lender. This Agreement shall not be construed so as to constitute a partnership between the parties or any of them.

Any such action so authorised and effected by the Agent shall be documented in such manner as the Agent and/or the Payment Agent (as the case may be) shall (with the approval of the Majority Lenders) determine, shall be promptly notified to the Lenders by the Agent and/or the Payment Agent (as the case may be) and (without prejudice to the generality of clause 16.2) shall be binding on the Lenders.

 

 

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Each Lender shall reimburse the Agent and the Payment Agent (rateably in accordance with such Lender’s Commitment or, after the first Advance or the Loan has been drawn, its Contribution,) to the extent that the Agent or the Payment Agent is not reimbursed by the Borrower, for the costs, charges and expenses incurred by the Agent or the Payment Agent which are expressed to be payable by the Borrower under clause 5.2 including (in each case), without limitation, the fees and expenses of legal or other professional advisers provided that, if following any payment to the Agent or the Payment Agent by a Lender under this clause the Agent or the Payment Agent receives payment from the Borrower in respect of the same costs, fees or expenses, the Agent or the Payment Agent shall upon receipt thereof reimburse the relevant Lender. Each Lender must on demand indemnify the Agent or the Payment Agent (rateably in accordance with such Lender’s Commitment or, after the first Advance or the Loan has been drawn, its 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 Security Documents or any action taken or omitted by the Agent or, as the case may be, the Payment Agent, under any of the Security Documents, unless such liabilities, damages, costs or claims arise from the Agent’s or as the case may be, the Payment Agent’s own gross negligence or wilful misconduct.

Any corporation into which the retiring Agent and/or the Payment Agent (as the case may be) may be merged or converted or any corporation with which the Agent and/or the Payment Agent (as the case may be) may be consolidated or any corporation resulting from any

 

 

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merger, conversion, amalgamation, consolidation or other reorganisation to which the Agent or the Payment Agent (as the case may be) 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 the 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 Lenders. Prior to any such successor being appointed, the Agent agrees to consult with the Borrower and the Lenders as to the identity of the proposed successor and to take account of any reasonable objections which the Borrower and the Lenders may raise to such successor being appointed.

Each of the Lenders, the Swap Banks and the Agent irrevocably appoints the Security Trustee as its Security Trustee and trustee for the purposes of the Security Documents, in each case on the terms set out in this Agreement. Accordingly, each of the Lenders, the Swap Banks and the Agent hereby authorises the Security Trustee (whether or not by or through employees or

 

 

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agents) to take such action on its behalf and to exercise such rights, remedies, powers and discretions as are specifically delegated to the Security Trustee by this Agreement and/or the Security Documents, together with such powers and discretions as are reasonably incidental thereto.

Without prejudice to clause 16.13, the Security Trustee may, having given to the Borrower and each of the Lenders and the Swap Banks not less than fifteen (15) days’ notice of its intention to do so, retire from its appointment as Security Trustee under this Agreement and any Trust Deed, provided that no such retirement shall take effect unless there has been appointed by the Lenders and the Agent as a successor Security Trustee and trustee:

and, in any case, such successor Security Trustee 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 Trustee as if it had been an original party to this Agreement and (ii) a duly executed Trust Deed.

Any corporation into which the retiring Security Trustee may be merged or converted or any corporation with which the Security Trustee may be consolidated or any corporation resulting from any merger, conversion, amalgamation, consolidation or other reorganisation to which the Security Trustee shall be a party shall, to the extent permitted by applicable law, be the successor Security Trustee 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, the Swap Banks and the

 

 

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Lenders. Prior to any such successor being appointed, the Security Trustee agrees to consult with the Borrower as to the identity of the proposed successor and to take account of any reasonable objections which the Borrower may raise to such successor being appointed.

Upon any such successor as aforesaid being appointed, the retiring Security Trustee 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 Trustee. The retiring Security Trustee 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.

and, in each and every case, to hold any and all security thereby created upon trust for the Lenders, the Swap Banks and the Agent for the time being in the manner contemplated by this Agreement.

 

 

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Any such action so authorised and effected by the Security Trustee shall be promptly notified to the Lenders, the Swap Banks and the Agent by the Security Trustee and shall be binding on the other Banks.

 

 

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such information, so that the Security Trustee 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 Trustee has actual knowledge that such information is inaccurate or incorrect.

and the parties to this Agreement declare that the perpetuity period applicable to this Agreement and the trusts declared by the Trust Deed shall for the purposes of the Perpetuities and Accumulations Act 1964 be the period of eighty (80) years from the date of this Agreement.

 

 

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moneys or in any other property or investments whether similar to the aforesaid or not or by placing the same on deposit in the name or under the control of the Security Trustee as the Security Trustee may think fit without being under any duty to diversify its investments and the Security Trustee may at any time vary or transpose any such property or investments for or into any others of a like nature and shall not be responsible for any loss due to depreciation in value or otherwise of such property or investments. Any investment of any part or all of the security may, at the discretion of the Security Trustee, be made or retained in the names of nominees.

None of the Banks 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 Lenders but, provided such consent has been obtained, it shall not be necessary for any other Bank to be joined as an additional party in any Proceedings for this purpose.

The Agent and the Security Trustee have entered into the Security Documents in their separate capacities (a) as agent for the Lenders under and pursuant to this Agreement (in the case of the Agent) and (b) as Security Trustee and trustee for the Lenders, the Swap Banks and the Agent under and pursuant to this Agreement, to hold the guarantees and/or security created by the Security Documents specified in clause 16.14 on the terms set out in such Security Documents (in the case of the Security Trustee). If and when the Agent and the Security Trustee are the same entity and any Security Document provides for the Agent to communicate with or provide instructions to the Security Trustee (and vice versa), all parties to this Agreement agree that any such communications or instructions on such occasions are unnecessary and are hereby waived.

The Lenders and the Agent shall co-operate with each other and with the Security Trustee 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.

 

 

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Moneys received by any of the Banks (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 Banks other than the Agent or the Security Trustee) and shall be distributed by the Agent or, as the case may be, the Security Trustee (in the case of moneys so received by the Agent or, as the case may be, the Security Trustee) in each case in accordance with clause 13.1. The Agent or, as the case may be, the Security Trustee 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 Trustee 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 Trustee (acting on the instructions of the Majority Lenders) 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 Trustee and/or the Account Bank and/or the Arrangers and/or the Lenders, the Swap Banks or any of them to provide for the whole of their respective claims against the Borrower or any other person liable.

After consultation with the Borrower and the Lenders and notwithstanding clause 16.11, the Agent shall be entitled to make such amendments to this Agreement as it may determine to be necessary to take account of any changes in market practices as a consequence of the European Monetary Union (whether as to the settlement or rounding of obligations, business days, the calculation of interest or otherwise whatsoever). So far as possible such amendments shall be such as to put the parties in the same position as if the event or events giving rise the need to amend this Agreement had not occurred. Any amendment so made to this Agreement by the Agent shall be promptly notified to the other parties hereto and shall be binding on all parties hereto.

 

 

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Without prejudice to the Borrower’s rights, in certain instances, to give their consent thereunder, clauses 15 and 16 are for the exclusive benefit of the Banks.

 

 

 

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hereafter specify for such purpose to the Borrower and the other Lenders by notice in writing);

Agent:

 

 

 

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Every notice under this Agreement or (unless otherwise provided therein) any other Security Document to be given by the Borrower to any other party, shall be given to the Agent for onward transmission as appropriate and every notice under this Agreement to be given to the Borrower shall (except otherwise provided in the Security Documents) be given to the Borrower by the Agent.

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

For the benefit of the Banks, and subject to clause 19.4 below, the Borrower hereby irrevocably agrees that the courts of England shall have exclusive jurisdiction:

 

 

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shall arise under the laws of England or under the laws of some other country and regardless of whether a particular cause of action may successfully be brought in the English courts; and

The Borrower accordingly irrevocably and unconditionally submits to the jurisdiction of the English courts. Without prejudice to any other mode of service the Borrower:

The Borrower:

 

 

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any other jurisdiction in connection with any dispute or related matter falling within clause 19.1; and

Without prejudice to the generality of clause 13.9, the jurisdiction agreement contained in this clause 19 shall be severable from the rest of this Agreement and shall remain valid, binding and in full force and shall continue to apply notwithstanding this Agreement or any part thereof being held to be avoided, rescinded, terminated, discharged, frustrated, invalid, unenforceable, illegal and/or otherwise of no effect for any reason.

 

 

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the Banks and the Borrower hereby agree and declare that the benefit of this clause 19 shall extend to and may be enforced by any officer, employee, agent or business associate of any of the Banks against whom the Borrower brings a claim in connection howsoever with any of the Security Documents or any assets subject thereto or any action of any kind whatsoever taken by, or on behalf of or for the purported benefit of any Bank pursuant thereto or which, if it were brought against the Lender, would fall within the material scope of clause 19.1. In those circumstances this clause 19 shall be read and construed as if references to any Bank were references to such officer, employee, agent or business associate, as the case may be.

 

 

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Schedule 1

The Lenders and their Commitments

 

 

 

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Schedule 2

Part A

Owned Vessels

 

Part B

Chartered Vessels

 

 

 

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Schedule 3

Form of Drawdown Notice

[●] 2007

Dear Sirs

We refer to the Loan Agreement. Words and expressions whose meanings are defined therein shall have the same meanings when used herein.

We hereby give you notice that we wish to draw the sum of USD [           ] on [date] 2007 for payment to [     ] and select a first Interest Period in respect of such drawing of [●] months. The funds should be credited to [     ] with [     ].

We confirm that:

 

 

 

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Schedule 4

Conditions precedent

Part 1

(referred to in clause 9.1)

Certified Copies of all documents which evidence or relate to the constitution of each Security Party and Navios GP and its current limited partnership, limited liability company or corporate existence together with evidence in form and substance acceptable to the Lenders in respect of the Capital Structure of the Group;

a certificate (dated no earlier than 5 Banking Days prior to the first Drawdown Date) that there are no Required Authorisations or that there are no Required Authorisations except those described in such certificate and Certified Copies of which as duly executed (including any conditions and/or documents ancillary thereto) are appended thereto.

a list of directors and officers of each Security Party specifying the names and positions of such persons, certified by an officer of such Security Party to be true, complete and up to date;

 

 

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a Certified Copy of each Management Agreement, the Fantastiks MOA, the MOAs, the Existing Charters, the Existing Charters-in, the Existing Charterers-out, the Omnibus Agreement, the Fantastiks Charters and all ISM Code Documentation for each Owned Vessel all on terms acceptable to the Agent;

the Master Agreement, duly executed and delivered;

made at the cost of the Borrower by an Approved Broker not more than 15 days or less than 5 Banking Days prior to the first Drawdown Date, giving the charter-free values of all of the Owned Vessels in scope, form and substance acceptable to the Lenders;

evidence that such fees as are due and payable on the Execution Date and on the first Drawdown Date have been or as the case may be, will have been paid in full; and

a letter from the Borrower’s agent for receipt of service of proceedings referred to in clause 19.2.1 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 the agent for any Security Party.

Evidence that:

 

 

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percentage may reduce from 40% or above to 30% or above immediately upon drawdown of Advance A);

Evidence that the Borrower has successfully raised at least USD 130,000,000 through an initial public offering on the New York Stock Exchange;

all such evidence and documentation on any Lender may reasonably require in relation to its “Know-your-customer” requirements in respect of any Security Party.

Part 2

(referred to in Clause 9.2)

is registered in the name of the relevant Owner through the Registry under the laws and flag of the Flag State and that the relevant Vessel and her Earnings, Insurances and Requisition Compensation (as defined in the relevant Mortgage) and any Existing Charter are free of Encumbrances except Permitted Encumbrances (such evidence to include relevant certificates issued by the Flag State and results of searches carried out against the said Registry by the Agent or its lawyers);

(to be provided at least 15 days prior to the relevant Drawdown Date) maintains the Classification free of all requirements and recommendations of the Classification Society; and

 

 

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(to be provided at least 15 days prior to the relevant Drawdown Date) is insured in accordance with the provisions of the relevant Ship Security Documents and all requirements of such Ship Security Documents in respect of such insurance have been complied with (including without limitation, receipt by the Agent of customary brokers’ letters of undertaking regarding the placing of hull and machinery and war risks cover and confirmation from the protection and indemnity association or other insurer with which the relevant Vessel is entered for insurance or insured against protection and indemnity 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 the relevant Vessel);

(other than the documents required to be delivered pursuant to part 4 item (b) and part 5 item (b)) the Guarantees, the Mortgages, the Master Agreement Security Deeds, the Charter Account Pledges, the Earnings Account Pledge, the Retention Account Pledge, the General Assignments, Manager’s Undertakings, the Fantastiks Assignment and the Charter Assignments (other than in respect of “FANTASTIKS”) duly executed and delivered;

counterpart originals of duly executed notices of assignment required by the terms of the Security Documents and in the forms prescribed by the Security Documents and any other documents required to be delivered pursuant thereto;

evidence that each Mortgage in respect of each Owned Vessel has been duly registered against the relevant Vessel in accordance with the laws of the relevant Flag State;

evidence that Earnings Account, the Charter Accounts and the Retention Account have been opened and duly completed mandates in relation thereto have been delivered to the Account Bank;

 

 

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an opinion of Messrs Cozen O’Connor special legal advisers to the Banks on Marshall Islands law;

an opinion of Messrs Patton, Moreno & Asvat, special legal advisers in Panama to the Banks;

any such further opinions as may be required by the Agent;

evidence satisfactory to the Agent that each Owned Vessel is subject to a ship security plan which complies with the ISPS Code and (ii) a copy of the ISSC for such Vessel;

written confirmation addressed by the Manager to the Agent that the representations and warranties set out in clause 7.1.20 (Environmental Matters) and clause 7.1.21 (ISM Code) are true and correct;

a written report from a maritime insurance consultant or broker acceptable to the Lenders in a form and content acceptable to the Lenders in respect of the insurances on each of the Owned Vessels, which report shall certify that such insurances are placed through or with insurance brokers and clubs, in amounts, covering risks and on terms acceptable to the Majority Lenders and that the same are in accordance with the terms of the Mortgages in respect of such Vessels;

evidence that all fees and commissions due and payable have been paid in full;

evidence acceptable to the Agent that (i) during the 2 years following the first Drawdown Date the fees payable to the Manager will not exceed, in relation to “FANTASTIKS” and the Newbuilding, USD 5,000 per day and in relation to the other Owned Vessels, USD 4,000 per day and (ii) that such fees will be applied in payment of management fees, special survey expenses and dry docking fees.

 

 

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Part 3

(referred to in Clause 9.3)

has been unconditionally delivered by the Fantastiks Seller to, and accepted by, Fantastiks under the Fantastiks MOA, and the full purchase price payable under the Fantastiks Kleimar MOA and the Fantastiks MOA (in addition to the part to be financed by Advance B) has been duly paid, together with copies of the bills of sale and protocols of delivery and acceptance relating thereto;

is registered in the name of Fantastiks through the Registry under the laws and flag of the Flag State and that she and her Earnings, Insurances and Requisition Compensation (as defined in the relevant Mortgage) and any Existing Charter are free of Encumbrances except Permitted Encumbrances (such evidence to include relevant certificates issued by the Flag State and results of searches carried out against the said Registry by the Agent or its lawyers);

maintains the Classification free of all requirements and recommendations of the Classification Society; and

is insured in accordance with the provisions of the relevant Ship Security Documents and all requirements of such Ship Security Documents in respect of such insurance have been complied with (including without limitation, receipt by the Agent of customary brokers’ letters of undertaking regarding the placing of hull and machinery and war risks cover and confirmation from the protection and indemnity association or other insurer with which “FANTASTIKS” is entered for insurance or insured against protection and indemnity 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 her);

 

 

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the Guarantee from Fantastiks, the Mortgage over “FANTASTIKS”, the General Assignment, Managers’ Undertakings and the Charter Assignment in respect of “FANTASTIKS” duly executed and delivered;

counterpart originals of duly executed notices of assignment required by the terms of the Security Documents referred to in (b) above and in the forms prescribed by these Security Documents and any other documents required to be delivered pursuant thereto;

evidence that the Mortgage in respect of “FANTASTIKS” has been duly registered against her in accordance with the laws of the relevant Flag State;

an opinion of Messrs Cozen O’Connor special legal advisers to the Banks in respect of Marshall islands law;

any such further opinions as may be required by the Agent;

evidence satisfactory to the Agent that “FANTASTIKS” is subject to a ship security plan which complies with the ISPS Code and (ii) a copy of the ISSC for such Vessel;

written confirmation addressed by the Manager to the Agent that the representations and warranties set out in clause 7.1.20 (Environmental Matters) and clause 7.1.21 (ISM Code) are true and correct;

 

 

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a written report from a maritime insurance consultant or broker acceptable to the Lenders in a form and content acceptable to the Lenders in respect of the insurances on “FANTASTIKS”, which report shall certify that such insurances are placed through or with insurance brokers and clubs, in amounts, covering risks and on terms acceptable to the Majority Lenders and that the same are in accordance with the terms of the Mortgage in respect of such Vessel; and

evidence that all fees and commissions due and payable have been paid in full; and

Part 4

(referred to in Clause 9.4)

has been unconditionally delivered by the Newbuilding Seller to, and accepted by, Nostos under the Newbuilding MOA, and the full purchase price payable under the Newbuilding MOA (in addition to the part to be financed by Advance C) has been duly paid, together with a copy of the bill of sale and protocol of delivery and acceptance relating thereto;

is registered in the name of Nostos through the Registry under the laws and flag of the Flag State and that she and her Earnings, Insurances and Requisition Compensation (as defined in the relevant Mortgage) are free of Encumbrances except Permitted Encumbrances (such evidence to include relevant certificates issued by the Flag State and results of searches carried out against the said Registry by the Agent or its lawyers);

maintains the Classification free of all requirements and recommendations of the Classification Society; and

 

 

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is insured in accordance with the provisions of the relevant Ship Security Documents and all requirements of such Ship Security Documents in respect of such insurance have been complied with (including without limitation, receipt by the Agent of customary brokers’ letters of undertaking regarding the placing of hull and machinery and war risks cover and confirmation from the protection and indemnity association or other insurer with which the Newbuilding is entered for insurance or insured against protection and indemnity 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 her);

the Guarantee from Nostos, the Mortgage over the Newbuilding, the General Assignment, Managers’ Undertakings and the Charter Assignment in respect of the Newbuilding duly executed and delivered;

counterpart originals of duly executed notices of assignment required by the terms of the Security Documents referred to in (b) above and in the forms prescribed by these Security Documents and any other documents required to be delivered pursuant thereto;

evidence that the Mortgage in respect of the Newbuilding has been duly registered against her in accordance with the laws of the relevant Flag State;

an opinion of Messrs Cozen O’Connor special legal advisers to the Banks in respect of Marshall islands law;

an opinion of Messrs Patton, Moreno & Asvat, legal advisors to the Banks on Panamanian law;

 

 

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any such further opinions as may be required by the Agent;

evidence satisfactory to the Agent that the Newbuilding is subject to a ship security plan which complies with the ISPS Code and (ii) a copy of the ISSC for such Vessel;

written confirmation addressed by the Manager to the Agent that the representations and warranties set out in clause 7.1.20 (Environmental Matters) and clause 7.1.21 (ISM Code) are true and correct;

a written report from a maritime insurance consultant or broker acceptable to the Lenders in a form and content acceptable to the Lenders in respect of the insurances on the Newbuilding, which report shall certify that such insurances are placed through or with insurance brokers and clubs, in amounts, covering risks and on terms acceptable to the Majority Lenders and that the same are in accordance with the terms of the Mortgage in respect of such Vessel;

a valuation of the Newbuilding and each of the Mortgaged Vessels prepared at the cost of the Borrower by an Approved Broker not more than 2 months prior to the relevant Drawdown Date and to be provided to the Agent no more than 10 or fewer than 5 Banking Days prior to the relevant Drawdown Date, giving their charter-fee value in scope and form and substance acceptable to the Lenders showing (i) the Loan, after Drawdown of Advance C, to be no more than 70% of the aggregate Valuation Amounts of the Mortgaged Vessels (including the Newbuilding) and (ii) Advance C to be no more than 65% of the Valuation Amount of the Newbuilding;

evidence that all fees and commissions due and payable have been paid in full; and

 

 

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Evidence that following drawdown of Advance D the Security Value exceeds the Required Security Amount.

 

 

4

 

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Schedule 5

Form of Transfer Certificate

(referred to in clause 15.3)

TRANSFER CERTIFICATE

Lenders are advised not to employ Transfer Certificates or otherwise to assign or transfer interests in the Loan 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: DVB Bank AG as Agent on its own behalf and on behalf of the Borrower, the Lenders, the Payment Agent, the Swap Banks, the Account Bank, the Security Trustee and the Arrangers as defined in the Loan Agreement referred to below.

[Date]

Attention: [●]

This certificate (“Transfer Certificate”) relates to a USD 260,000,000 revolving and term loan credit facility agreement dated [    ] November 2007 (the “Loan Agreement”) made between (1) Navios Maritime Partners L.P. (as Borrower) , (2) DVB Bank AG and Commerzbank AG (as Lenders), (3) DVB Bank AG (as Agent, Swap Bank, Joint-Arranger, Account Bank and Security Trustee) and (4) Commerzbank AG (as Joint-Arranger, Payment Agent and Swap Bank). Words and expressions defined in the Loan Agreement shall, unless otherwise defined herein, have the same meanings when used in this Certificate.

In this Certificate:

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

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

 

 

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all necessary approvals and consents to the assumption of its obligations under the Security Documents; and

 

 

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and satisfaction of the conditions (if any) subject to which this Transfer Certificate is expressed to take effect.

 

 

 

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Agent

Agreed for and on behalf of itself as Agent, the Arrangers, the Payment Agent, the Borrower, the Swap Banks, the Security Trustee, the Account Bank, the Arrangers and the Lenders.

 

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.

The schedule

 

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:]

 

 

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Schedule 6
Form of Compliance Certificate

Dear Sirs

We refer to the Loan Agreement. Words and expressions whose meanings are defined in the Loan Agreement shall have the same meanings when used herein.

We hereby confirm that [except as stated below] as at the date hereof to the best of our knowledge and belief after due inquiry:-

 

 

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[State any exceptions/qualifications to the above statements]

Yours faithfully

 

 

 

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Schedule 7
Form of Trust Deed

THIS DECLARATION OF TRUST is made by DVB BANK AG (the “Security Trustee”) on [●] November, 2007 and is supplemental to (and made pursuant to the terms of) a USD 260,000,000 facility agreement dated [    ] November, 2007 (the “Loan Agreement”) made between(1) Navios Maritime Partners L.P. (as Borrower), (2) DVB Bank AG and Commerzbank AG (as Lenders), (3) DVB Bank AG (as Agent, Swap Bank, Joint-Arranger, Account Bank and Security Trustee) and (4) Commerzbank AG (as Joint-Arranger, Payment Agent and Swap Bank). Words and expressions whose meanings are defined in the Loan Agreement shall have the same meanings when used in this Deed.

NOW THIS DEED WITNESSETH as follows:

IN WITNESS whereof the Security Trustee has executed this Deed the day and year first above written.

 

 

 

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SCHEDULE 8

MANDATORY COSTS

((0.01 x E) divided by 300) per cent. per annum

Where:

E is designed to compensate Lenders 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.

(a) “Eligible Liabilities” and “Special Deposits” have the meanings given to them from time to time under or pursuant to the Bank of England Act 1998 or (as may be appropriate) by the Bank of England;

(b) “Fees Rules” means the rules on periodic fees contained in the FSA Supervision 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;

(c) “Fee Tariffs” means the fee tariffs specified in the Fees Rules under 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);

(d) “Participating Member State” means any member state of the European Union that adopts or has adopted the euro as its lawful currency in accordance with legislation of the European Union relating to European Monetary Union; and

 

 

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(e) “Tariff Base” has the meaning given to it in, and will be calculated in accordance with, the Fees Rules.

Each Lender shall promptly notify the Agent in writing of any change to the information provided by it pursuant to this paragraph.

 

 

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Execution Pages

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

 

 

 

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