Common use of Forbearance Clause in Contracts

Forbearance. Bank agrees to forbear from exercising its rights and remedies under the Existing Loan Documents and at law ("Default Rights") until the earlier of (a) October 30, 2002, or (b) the occurrence of a Default under this Agreement (the "Forbearance Period"), notwithstanding Borrower's existing default under the Loan Agreement as a result of Borrower's failure to comply with the profitability covenant set forth in Section 6.2 of the Loan Agreement for the fiscal quarter ended June 30, 2002 (the foregoing being referred to as "Existing Defaults"). Hereinafter, the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result of the Existing Defaults, Bank is entitled to exercise its remedies as provided in the Existing Loan Documents and as provided under applicable law. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of any of the terms set forth in this Agreement, (b) the occurrence of any default (other than the Existing Defaults) under the Existing Loan Documents, or (c) if any recital, representation or warranty made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf of the Borrower in connection with this Agreement or any other document executed and delivered in connection with this Agreement, shall prove to have been false, incomplete or misleading in any material respect on the date as of which it was made (collectively, a "Default"), whereupon Bank, at its option, without any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end of the Forbearance Period (a) in no way shall be deemed an agreement by Bank to waive Borrower's compliance with all other terms of the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement and (b) shall not limit or impair Bank's right to demand strict performance of all other terms and covenants as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of the Existing Defaults. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations to the extent that the exercise of any Default Rights was precluded by this Agreement.

Forbearance. Bank 3.1 IFC hereby agrees to forbear from exercising its rights the Forbearance upon and remedies under subject to the Existing Loan Documents terms and at law ("Default Rights") conditions of this Agreement. The Forbearance will take effect on the Effective Date and will continue until the earlier of of: (ai) October 3012:00 pm (New York time) on March 31, 2002, 2016; or (bii) the occurrence of a Default under this Agreement Termination Date (the "Forbearance Period"). 3.2 The Forbearance will take effect and the Forbearance Period will begin on the date when IFC notifies the Borrower in writing that the following conditions have been met in form and substance satisfactory to IFC or waived in writing by IFC (the "Effective Date"): (a) this Agreement has been executed by each of the parties hereto; (b) IFC has received copies of Board Resolutions of the Parent Company authorising the execution, notwithstanding Borrower's existing default delivery and performance by the applicable Ultrapetrol Entity of this Agreement; (c) IFC shall have received a fee equal to$15,000, no later than January 15, 2016; (d) IFC shall have received fully executed copies of Third Party Forbearance Agreements entered into by the applicable Ultrapetrol Entity and applicable creditor on or prior to the Effective Date; and (e) the Borrower agrees to (x) pay all fees and expenses of a legal advisor and a financial advisor to be retained jointly by IFC and OFID in their sole discretion (including the determination of the scope of work to be conducted by such advisors) in connection with the negotiation and documentation of a restructuring transaction (in or outside of a court in (or outside of) the United States of America); (y) indemnify IFC for all pending and outstanding fees of the legal advisor and financial advisor to the extent they have not been paid by the Borrower within 5 business days after receipt of an invoice and (z) fully cooperate and cause the Guarantor to fully cooperate with the legal advisor and the financial advisor. 3.3 Subject to Sections 5 and 7, during the Forbearance Period, IFC agrees not to enforce any of its rights and remedies under the Loan Agreement Transaction Documents relating to, and will not otherwise bring any litigation, arbitration or other judicial or quasi-judicial proceeding in connection with or solely as a result of Borrower's failure to comply with the profitability covenant set forth in Section 6.2 of the Loan Agreement for the fiscal quarter ended June 30, 2002 (the foregoing being referred to as "Existing Defaults"). Hereinafterof, the Existing Loan Current Events of Default, whether directly or by enforcement of its rights under the Security Documents, as modified . 3.4 The entering into by IFC and the performance by it of its agreements and obligations under this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result of the Existing Defaults, Bank is entitled to exercise its remedies as provided in the Existing Loan Documents and as provided under applicable law. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of prejudice to any of IFC's rights with respect to the terms set forth in this AgreementCurrent Events of Default, (b) the occurrence of any default (other than the Existing Defaults) under the Existing Loan Documents, or (c) if any recital, representation or warranty made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished which may be asserted by or on behalf of the Borrower in connection with this Agreement or any other document executed and delivered in connection with this Agreement, shall prove to have been false, incomplete or misleading in any material respect on the date as of which it was made (collectively, a "Default"), whereupon Bank, IFC at its option, without any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end of the Forbearance Period (a) Period, or with respect to any other rights of IFC in no way respect of any other matter. Without limiting the generality of the preservation of rights set forth in Section 7.1, nothing contained in this Agreement is intended or shall be deemed to constitute an acknowledgment, representation, warranty, covenant or other agreement by Bank on the part of IFC that it has agreed or it will agree: (i) to waive Borrower's compliance with all other terms enter into any restructuring of the Existing Loan Documents, as modified by this Loan Modification Borrower and Forbearance Agreement the Guarantor's obligations and (b) shall not limit or impair Bank's right to demand strict performance of all other liabilities under the Transaction Documents on any terms and covenants as conditions; (ii) to grant any forbearance relating to any Potential Event of Default or Event of Default other than the Current Events of Default; or (iii) to grant any forbearance relating to the Current Events of Default beyond the end of the Forbearance Period, and no such agreement may be implied by anything in this Agreement. The Borrower and the Guarantor acknowledge that IFC has not made any assurances whatsoever concerning any possibility of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver extensions of the Existing Defaults. Borrower further agrees that Forbearance Period, any other standstill, forbearance or similar arrangement or any other limitations on the exercise of its rights, remedies and privileges under or otherwise in connection with the Transaction Documents or applicable law. 3.5 The Borrower and the Guarantor agree that notwithstanding their respective entry into the Forbearance or the termination thereof, all of their respective obligations under the IFC Loan Agreement, the Security Documents and any Default Rights by Bank upon termination other Transaction Documents to which it is a party are and continue to be in full force and effect, and are not, except as otherwise expressly provided herein, varied, amended, modified, waived or released in any manner, including during the Forbearance Period. Except as otherwise expressly provided herein, neither the Borrower nor the Guarantor shall be released or otherwise excused from complying with any provisions of any of the Forbearance Period Transaction Documents. The Borrower also acknowledges that the absence at the date of this Agreement of notices from IFC with respect to any Events of Default other than the Current Events of Default does not amount to any waiver by IFC of those Events of Default. 3.6 Notwithstanding Section 3.3 hereof, the Borrower and the Guarantor shall not be affected comply, except to the extent such compliance is excused by reason the terms of this Agreement, and with all explicit restrictions or prohibitions triggered by the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches existence or any statute of limitations to the extent that the exercise continuation of any Potential Event of Default Rights was precluded by this Agreementor Event of Default under the IFC Loan Agreement and each other Transaction Document.

Forbearance. Bank The Company acknowledges the Existing Defaults are existing and uncured Events of Default under the Operative Documents, which are continuing as of the date of this Agreement. The Company further acknowledges and agrees that the Purchaser is not in any way agreeing to waive such Existing Defaults as a result of this Agreement or the performance by the parties of their respective obligations hereunder or thereunder except as expressly set forth herein and the Purchaser expressly reserves its rights and remedies in regards thereof except as expressly set forth herein. Subject to the conditions contained herein and performance by the Company of all of the terms of this Agreement, the Purchaser shall waive the Existing Defaults identified in Recital B above and agrees to forbear from enforcing the remedies set forth in clauses (i) through (vi) below, and shall forbear from exercising its rights and the following remedies under the Existing Loan Documents and at law ("Default Rights") until the earlier it has as a result of (a) October 30, 2002, or (b) the occurrence of a Default under the Existing Defaults through the date of this Agreement (the "Forbearance PeriodFORBEARANCE PERIOD")): (i) enforcing the Default Payment pursuant to Article IV of the Term Note, notwithstanding Borrower's existing (ii) acceleration of the principal, interest and other fees that remain unpaid pursuant to Article IV of the Term Note, (iii) enforcement of the Guaranties, (iv) enforcement of all accrued and unpaid liquidated damages pursuant to Section 2(b) of the Registration Rights Agreement, (v) enforcement of the default under the Loan Agreement as a result of Borrower's failure to comply with the profitability covenant provisions set forth in Section 6.2 5 of the Loan Agreement for the fiscal quarter ended June 30Security Agreement, 2002 and (the foregoing being referred to as "Existing Defaults"). Hereinafter, the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result vi) enforcement of the Existing Defaults, Bank is entitled to exercise its remedies as provided in the Existing Loan Documents and as provided under applicable law. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of any of the terms default provisions set forth in this Sections 3, 5(c), 6, 7 and 14 of the Stock Pledge Agreement. It is expressly agreed and understood by the parties hereto that in the event that the Company fails to repay (x) at least $250,000 of the Principal Amount of the Term Note to the Purchaser (through cash payment of immediately available funds only), not including the payment required to be made as of the date hereof, on or prior to August 1, 2006 (bthe "AUGUST REPAYMENT") or (y) at least $2,000,000 of the Principal Amount of the Term Note (through conversion or cash payment of immediately available funds only) to the Purchaser on or before August 31, 2006, an Event of Default shall immediately arise upon the occurrence of any default (other than either such repayment failure. Additionally, this forbearance shall not be construed as an agreement by the Existing Defaults) under the Existing Loan Documents, or (c) if any recital, representation or warranty made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf of the Borrower in connection with this Agreement or any other document executed and delivered in connection with this Agreement, shall prove to have been false, incomplete or misleading in any material respect on the date as of which it was made (collectively, a "Default"), whereupon Bank, at its option, without any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement Purchaser to forbear from enforcing exercising any of its Default Rights rights or remedies under the Existing Loan Operative Documents until the end with respect to any further Events of the Forbearance Period (a) in no way shall be deemed an agreement by Bank to waive Borrower's compliance with all other terms of the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement and (b) shall not limit or impair Bank's right to demand strict performance of all other terms and covenants as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of the Existing Defaults. Borrower further agrees Default that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason may occur after date of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations to the extent that the exercise of any Default Rights was precluded by this Agreement.

Forbearance. Bank agrees During the period (the “Forbearance Period”) commencing on the date hereof and ending on the earlier to occur of December 14, 2001 and the date of any Forbearance Default (as defined below), and subject to the satisfaction of the conditions set forth in Section 2 hereof, the Agents and the Lenders will forbear from exercising its their rights and remedies under the Existing Credit Agreement and the other Loan Documents and at law ("Default Rights") until the earlier of (a) October 30, 2002, or (b) the occurrence of a Default under this Agreement (the "Forbearance Period"), notwithstanding Borrower's existing default under the Loan Agreement as a result of Borrower's failure solely with respect to comply with the profitability covenant set forth in Section 6.2 of the Loan Agreement for the fiscal quarter ended June 30, 2002 (the foregoing being referred to as "Existing Defaults"). Hereinafter, the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result of the Existing Defaults, Bank is entitled to exercise its remedies as provided in the Existing Loan Documents and as provided under applicable law. The “Forbearance Period Default” shall be immediately terminated, without notice, if mean: (ai) Borrower breaches an Event of any of the terms set forth in this Agreement, (b) the occurrence of any default Default (other than the Existing Defaults), (ii) under the Existing Loan Documentsfailure of either Borrower to keep or perform any of the covenants or agreements contained herein providing for a payment or prepayment to the Agents or the Lenders, (iii) the failure of either Borrower to keep or perform any of the covenants or agreements contained herein (cother than those referred to in clause (ii) if above) two Business Days after the date the Borrowers receive written notice from an Agent of any recitalsuch failure (the “Notice Period”), provided that in the event any such failure is remedied within the Notice Period, such failure shall not constitute a Forbearance Default, (iv) any representation or warranty of either Borrower herein shall be incorrect when made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf of the Borrower in connection with this Agreement or any other document executed and delivered in connection with this Agreement, shall prove to have been false, incomplete or misleading deemed made in any material respect respect, (v) the Borrower and the proposed Investors (the “Investors”) referred to in the Series A Preferred Stock Proposal Summary dated October 3, 2001 (the “Proposal”) do not execute a commitment letter or definitive documentation consistent with the Proposal in form and substance acceptable to the Agents on or before December 10, 2001 and (vi) the date as U.S. Borrower and the Subordinated Note Holders holding in excess of which it was made (collectively, a "Default"), whereupon Bank, at its option, without any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end 66 2/3% in face amount of the Forbearance Period (a) in no way shall be deemed an Subordinated Notes do not enter into a “lock-up” agreement by Bank to waive Borrower's compliance consistent with all other terms the “Term Sheet for Restructuring of the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement and (b) shall not limit or impair Bank's right to demand strict performance of all other terms and covenants as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of the Existing Defaults. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations Bond Debt” which is Exhibit B to the extent that Senior Debt Term Sheet in form and substance satisfactory to the exercise of any Default Rights was precluded by this AgreementAgents on or before November 20, 2001.

Forbearance. Bank agrees to PBF shall forbear from exercising its rights or remedies with respect to foreclosure of the security interests in the Collateral, imposition of the Default Interest rate or other enforcement of the Term Note and remedies under other Factoring Documents on the Existing Loan Documents terms and at law ("Default Rights") until conditions set forth herein including the earlier following: The Maximum Commitment set forth in Schedule 1 of the Domestic Factoring Agreement is hereby amended to mean an amount equal to the lesser of (a) October 30, 2002, Three Million Dollars or (b) the occurrence of a Default under this Agreement (Advance Rate; and the "Forbearance Period"), notwithstanding Borrower's existing default under the Loan Agreement as a result of Borrower's failure to comply with the profitability covenant Maximum Commitment set forth in Section 6.2 Schedule 1 of the Loan Ex-Im Factoring Agreement for is hereby amended to mean an amount equal to the fiscal quarter ended June 30, 2002 (the foregoing being referred to as "Existing Defaults"). Hereinafter, the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result lesser of the Existing Defaults, Bank is entitled to exercise its remedies as provided in the Existing Loan Documents and as provided under applicable law. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of any of the terms set forth in this Agreement, Four Million Dollars or (b) the occurrence of any Advance Rate. There shall be no default (other than the Existing Defaults) under the Existing New Loan Documents or the Factoring Documents apart from the Defaults; There shall be no default, as defined in Section 11 below, under this Forbearance Agreement; STI shall, on or before January 31, 2004, have closed and received all funds to be paid to STI pursuant to the `Initial Equity' investment described in Article II of the Investment Agreement, STI shall, on or before May 5, 2004, have closed and received all funds to be paid to STI pursuant to the `Second Equity' investment described in Article II of the Investment Agreement; The terms of this Forbearance Agreement and the New Loan Documents control over any provisions in the ▇▇▇▇▇▇▇ Letter Agreement or the Investment Agreement, and performance under the ▇▇▇▇▇▇▇ Letter Agreement and Investment Agreement shall be done in a manner consistent with this Forbearance Agreement and the New Loan Documents, ; No other holder of a voluntary or (c) if any recital, representation involuntary lien against all or warranty made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf part of the Borrower in connection with Collateral shall initiate any action to foreclose or otherwise enforce such lien; and If not terminated earlier pursuant to section 11 below, this forbearance shall terminate on May 5, 2004, at which time the Domestic Factoring Agreement or any other document executed and delivered in connection with this Agreement, the Ex-Im Factoring Agreement shall prove also be deemed to have been false, incomplete or misleading terminated pursuant to section 10 of each of said agreements. Acknowledgment of Certain Material Facts. STI further acknowledges that the sums claimed by PBF in any material respect on the date as of which it was made (collectively, a "Default"), whereupon Bank, at its option, without any notice Recital C to Borrower, may immediately cease making any Advances be due and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights owing under the Existing Loan Factoring Documents until are currently due and owing, that no defense to payment thereof exists, that the end of Factoring Documents are binding and enforceable according to their terms, and that PBF has no obligation to STI to advance further funds to STI or to purchase accounts under the Forbearance Period (a) Factoring Documents but continues to have the right to purchase Accounts in no way shall be deemed an agreement by Bank to waive Borrower's compliance its sole discretion in accordance with all other the terms of the Existing Loan Factoring Documents. Agreement, as modified by this Loan Modification and Forbearance Agreement and (b) shall not limit or impair Bank's right to demand strict performance of all other the terms and covenants as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver conditions of the Existing Defaults. Borrower further agrees that Factoring Documents remain in full force and effect, including without limitation the exercise grants of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations to the extent that the exercise of any Default Rights was precluded by this Agreementsecurity interests therein.

Forbearance. Bank 5.1 Subject to the terms and conditions hereof, the Lender agrees to forbear from exercising taking any Enforcement Action, including under Section 15 of the Secured Bridge Note or Section 6.2 of the Pledge Agreement or otherwise under the Loan Documents or under applicable law or at equity with respect to the Specified Events of Default, in each case, until the date (the “Forbearance Termination Date”) that is the earliest of: (a) October 1, 2009; (b) The Equity Offering (as defined in Section 6.5) does not result in net cash proceeds to the Borrower (after deduction of selling expenses, including, without limitation, underwriting fees and discounts, brokerage commissions and other similar fees and commissions) (“Equity Offering Net Proceeds”) of at least $3,000,000 or is not completed on or before October 1, 2009; (c) the date on which the Obligations are paid in full in cash; (d) the occurrence of a breach or default by the Borrower under this Agreement other than as specified in clause (g) below; (e) Borrower or any of its Subsidiaries fails to observe or perform any agreement or condition under the CoBank Loan Documents beyond the expiration of any applicable grace period, or any default or other event occurs, the effect of which default or other event is to cause, or to permit the holder or holders of the Indebtedness under the CoBank Loan Documents to cause, with the giving of notice if required, such Indebtedness to be demanded or to become due or to be repurchased, prepaid, defeased or redeemed (automatically or otherwise), or an offer to repurchase, prepay, defease or redeem such Indebtedness to be made, prior to its stated maturity; or (f) the occurrence of an Event of Default under clause (5) of the definition thereof in the Secured Bridge Note; or (g) the delivery to Borrower by Lender (at its discretion) of written notice (a “Forbearance Termination Notice”, which may be delivered by electronic mail) that the forbearance contemplated by this Article V is terminated as the result of the occurrence of an Event of Default (other than an Event of Default under clause (5) of the definition thereof in the Secured Bridge Note) that does not constitute a Specified Event of Default (it being understood and agreed that (i) any failure by Lender to deliver a Forbearance Termination Notice with respect to any Event of Default shall not be deemed to waive or otherwise limit or impair the rights and remedies of Lender with respect to such Event of Default (except as expressly provided in this clause (g)) and (ii) Lender may deliver its Forbearance Termination Notice with respect to an Event of Default (other than an Event of Default under clause (5) of the definition thereof in the Secured Bridge Note) that does not constitute a Specified Event of Default at any time after the occurrence of such Event of Default so long as such Event of Default is continuing and has not been cured or waived in accordance with the Secured Bridge Note, and any delay in delivering such Forbearance Termination Notice shall not be deemed a waiver of, or to otherwise limit or impair, the right of Lender to deliver such Forbearance Termination Notice or the effect of such delivery when so made at such future time. 5.2 The Borrower acknowledges, reaffirms and agrees that upon the occurrence of an event triggering the Forbearance Termination Date pursuant to Section 5.1 other than under clauses (a) or (c) of such Section, such Forbearance Termination Date shall be deemed to have occurred immediately prior to the applicable default and this Agreement shall terminate and the Lender shall be entitled to commence and exercise immediately all of its rights and remedies under the Existing Loan Documents and under applicable law or at law equity ("Default Rights"including, (A) until the earlier of any and all Enforcement Actions and (a) October 30, 2002, or (bB) the occurrence right to re-institute the per annum rate of a Default under this Agreement interest of eighteen percent (18.0%) on the "Forbearance Period")outstanding Obligations, notwithstanding Borrower's existing default under calculated in the Loan Agreement as a result of Borrower's failure to comply with the profitability covenant manner set forth in Section 6.2 1 of the Secured Bridge Note retroactive to the Maturity Date of the Secured Bridge Note, that was in effect immediately prior to the Forbearance Effective Date; provided, and the parties hereto acknowledge, confirm and agree, that the amount of interest that shall have been deemed paid-in-kind in accordance with Section 6.1 shall accrue and compound at the per annum rate of interest of eighteen percent (18.0%)). 5.3 The Borrower acknowledges, reaffirms and agrees that, unless and until the Lender, in accordance with Section 17 of the Secured Bridge Note, shall have waived in writing all Events of Default then in existence, the determination to give such waiver being at the Lender’s sole and absolute discretion, the Lender reserves all rights and remedies available to it under the Loan Documents and under applicable law or at equity (i) with respect to the Specified Events of Default and (ii) with respect to any Default or Event of Default under any of the Loan Documents which upon the Borrower’s execution and delivery of this Agreement for the fiscal quarter ended June 30, 2002 (the foregoing being referred to as "Existing Defaults")might otherwise exist or which might hereafter occur. Hereinafter, the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result The failure of the Existing Defaults, Bank is entitled Lender at any time or times hereafter to exercise its remedies as provided in require strict performance by the Existing Loan Documents and as provided under applicable law. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of any of the provisions, warranties, terms set forth and conditions contained in this Agreement, (b) the occurrence of any default (other than Secured Bridge Note, the Existing Defaults) under the Existing Loan Documents, or (c) if any recital, representation or warranty made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf of the Borrower in connection with this Pledge Agreement or any other document executed and delivered in connection with this AgreementLoan Document shall not waive, shall prove to have been false, incomplete affect or misleading in diminish any material respect on the date as of which it was made (collectively, a "Default"), whereupon Bank, at its option, without any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end right of the Forbearance Period (a) in no way shall be deemed an agreement by Bank to waive Borrower's compliance with all other terms of the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement and (b) shall not limit Lender at any time or impair Bank's right times thereafter to demand strict performance of all other terms and covenants as thereof. No waiver by the Lender of any dateof its rights shall operate as a waiver of any other of its rights or any of its rights on a future occasion at any time and from time to time. Nothing The terms, conditions and events described in this Loan Modification Section 5.3 are currently in full force and Forbearance Agreement in any way shall constitute Bank's waiver effect without regard to or the assent of the Existing Defaults. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations to the extent that the exercise of any Default Rights was precluded by this Agreementother Person.

Forbearance. Bank 3.1 IFC hereby agrees to forbear from exercising its rights the Forbearance upon and remedies under subject to the Existing Loan Documents terms and at law ("Default Rights") conditions of this Agreement. The Forbearance will take effect on the Effective Date and will continue until the earlier of of: (ai) October 3012:00 pm (New York time) on March 31, 2002, 2016; or (bii) the occurrence of a Default under this Agreement Termination Date (the "Forbearance Period"). 3.2 The Forbearance will take effect and the Forbearance Period will begin on the date when IFC notifies the Borrowers in writing that the following conditions have been met in form and substance satisfactory to IFC or waived in writing by IFC (the "Effective Date"): (a) this Agreement has been executed by each of the parties hereto; (b) IFC has received copies of Board Resolutions of the Parent Company authorising the execution, notwithstanding Borrower's existing default delivery and performance by the applicable Ultrapetrol Entity of this Agreement; (c) IFC shall have received a fee equal to $15,000, no later than January 15, 2016; (d) IFC shall have received fully executed copies of Third Party Forbearance Agreements entered into by the applicable Ultrapetrol Entity and applicable creditor on or prior to the Effective Date; and (e) the Borrowers agree to (x) pay all fees and expenses of a legal advisor and a financial advisor to be retained jointly by IFC and OFID in their sole discretion (including the determination of the scope of work to be conducted by such advisors) in connection with the negotiation and documentation of a restructuring transaction (in or outside of a court in (or outside of) the United States of America); (y) indemnify IFC for all pending and outstanding fees of the legal advisor and financial advisor to the extent they have not been paid by the Borrowers within 5 business days after receipt of an invoice and (z) fully cooperate and cause each other Obligor to fully cooperate with the legal advisor and the financial advisor. 3.3 Subject to Sections 5 and 7, during the Forbearance Period, IFC agrees not to enforce any of its rights and remedies under the Loan Agreement Transaction Documents relating to, and will not otherwise bring any litigation, arbitration or other judicial or quasi-judicial proceeding in connection with or solely as a result of Borrower's failure to comply with the profitability covenant set forth in Section 6.2 of the Loan Agreement for the fiscal quarter ended June 30, 2002 (the foregoing being referred to as "Existing Defaults"). Hereinafterof, the Existing Loan Current Events of Default, whether directly or by enforcement of its rights under the Security Documents, as modified . 3.4 The entering into by JFC and the performance by it of its agreements and obligations under this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result of the Existing Defaults, Bank is entitled to exercise its remedies as provided in the Existing Loan Documents and as provided under applicable law. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of prejudice to any of IFC's rights with respect to the terms set forth in this AgreementCurrent Events of Default, (b) the occurrence of any default (other than the Existing Defaults) under the Existing Loan Documents, or (c) if any recital, representation or warranty made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished which may be asserted by or on behalf of the Borrower in connection with this Agreement or any other document executed and delivered in connection with this Agreement, shall prove to have been false, incomplete or misleading in any material respect on the date as of which it was made (collectively, a "Default"), whereupon Bank, IFC at its option, without any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end of the Forbearance Period (a) Period, or with respect to any other rights of IFC in no way respect of any other matter. Without limiting the generality of the preservation of rights set forth in Section 7.1, nothing contained in this Agreement is intended or shall be deemed to constitute an acknowledgment, representation, warranty, covenant or other agreement by Bank on the part of IFC; that it has agreed or it will agree: (i) to waive Borrower's compliance with all other terms enter into any restructuring of the Existing Loan Documents, as modified by this Loan Modification Borrowers and Forbearance Agreement the Guarantor's obligations and (b) shall not limit or impair Bank's right to demand strict performance of all other liabilities under the Transaction Documents on any terms and covenants as conditions; (ii) to grant any forbearance relating to any Potential Event of Default or Event of Default other than the Current Events of Default; or (iii) to grant any forbearance relating to the Current Events of Default beyond the end of the Forbearance Period, and no such agreement may be implied by anything in this Agreement. Each Borrower and the Guarantor each acknowledges that IFC has not made any assurances whatsoever concerning any possibility of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver extensions of the Existing Defaults. Borrower further agrees that Forbearance Period, any other standstill, forbearance or similar arrangement or any other limitations on the exercise of its rights, remedies and privileges under or otherwise in connection with the Transaction Documents or applicable law. 3.5 Each Borrower and the Guarantor agree that notwithstanding their respective entry into the Forbearance or the termination thereof, all of their respective obligations under the IFC Loan Agreement, the Security Documents and any Default Rights by Bank upon termination other Transaction Documents to which it is a party are and continue to be in full force and effect, and are not, except as otherwise expressly provided herein, varied, amended, modified, waived or released in any manner, including during the Forbearance Period. Except as otherwise expressly provided herein, neither the Borrowers nor the Guarantor shall be released or otherwise excused from complying with any provisions of any of the Forbearance Period Transaction Documents. Each Borrower also acknowledges that the absence at the date of this Agreement of notices from IFC with respect to any Events of Default other than the Current Events of Default does not amount to any waiver by IFC of those Events of Default. 3.6 Notwithstanding Section 3.3 hereof, the Borrowers and the Guarantor shall not be affected comply, except to the extent such compliance is excused by reason the terms of this Agreement, and with all explicit restrictions or prohibitions triggered by the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches existence or any statute of limitations to the extent that the exercise continuation of any Potential Event of Default Rights was precluded by this Agreementor Event of Default under the IFC Loan Agreement and each' other Transaction Document.

Forbearance. Bank The Purchaser hereby confirms that, so long as Holdings and Services comply with all terms and conditions of the Note Agreement, as amended by this Amendment (other than the Enumerated Matters (as defined below)), the Purchaser agrees to forbear forbear, until the Forbearance Date defined below, from (i) accelerating or demanding immediate payment of the Obligations, and (ii) exercising its rights and remedies against Borrower under the Existing Loan Documents and at law Note Agreement. The Forbearance Date shall be February 28, 2005; provided however, that such date shall be automatically extended until April 1, 2005 so long as Holdings shall have, (x) on or prior to January 31, 2005 signed a term sheet with a third party or parties ("Default Rights") until the earlier of (a) October 30, 2002, or (b) the occurrence of a Default under this Agreement (the "Forbearance PeriodNew Investor"), notwithstanding Borrower's existing default under the Loan Agreement as a result of Borrower's failure to comply with the profitability covenant set forth in Section 6.2 of the Loan Agreement for the fiscal quarter ended June 30, 2002 (the foregoing being referred to as "Existing Defaults"). Hereinafter, the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result of the Existing Defaults, Bank is entitled to exercise its remedies as provided in the Existing Loan Documents and as provided under applicable law. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of any of substantially on the terms set forth on Annex 1 to the Tenth Waiver, Amendment and Forebearance Agreement dated December 31, 2004 and other terms and conditions that are reasonably satisfactory to Purchaser and (y) on or prior to February 28, 2005 filed a preliminary proxy statement with the Securities and Exchange Commission (the "SEC") requesting that such shareholders approve such financing from New Investor at a shareholders meeting to be held on or before May 31, 2005, which proxy statement shall comply in this Agreementall respects with the rules and regulations promulgated by the Securities and Exchange Commission, (b) the occurrence of any default (other than the Existing Defaults) under the Existing Loan Documents, or (c) if any recital, representation or warranty made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf rules of the Borrower in connection with this Agreement or Nasdaq National Market System and any other document executed and delivered applicable laws or regulations. The Forbearance Date shall be further extended until the day following the shareholders meeting described above (but in connection with this Agreementno event later than May 31, shall prove to have been false, incomplete or misleading in any material respect on the date as of which it was made (collectively, a "Default"2005), whereupon Bankso long as Holdings shall have, at on or prior to April 1, 2005, mailed a definitive proxy statement to its optionshareholders for the purpose described above. For purposes of this Amendment, without any notice to Borrowerthe "Enumerated Matters" shall have the meaning set forth in the Tenth Waiver, may immediately cease making any Advances Amendment and may immediately exercise any Default RightsForebearance Agreement dated December 31, 2004. Bank's Such agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end is effective only for such Enumerated Matters and not for any other defaults of the Forbearance Period (a) in no way shall be deemed an agreement covenants or obligations so listed by Bank to waive Borrower's compliance with all other terms of the Existing Loan Documents, as modified Purchaser or for any time periods not so listed by this Loan Modification and Forbearance Agreement and (b) shall not limit or impair Bank's right to demand strict performance of all other terms and covenants as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of the Existing Defaults. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations to the extent that the exercise of any Default Rights was precluded by this AgreementPurchaser.

Forbearance. Bank (i) In reliance upon the undertakings, representations, warranties, and covenants of each Borrower contained in this Agreement, and subject to the terms and conditions of this Agreement and any documents or instruments executed in connection herewith, the Lender agrees to forbear from exercising its rights and remedies under the Existing Loan Transaction Documents and at or applicable law ("Default Rights") until the earlier in respect of or arising out of (a) October 30the Existing Defaults, 2002, or (b) the occurrence of a Default under this Agreement (the "Forbearance Period"), notwithstanding Borrower's existing default under the Loan Agreement as a result of Borrower's any failure to comply with the profitability covenant covenants set forth in Section 6.2 Sections 6.1.1, 6.1.2, or 6.5.9 of the Loan Agreement for the fiscal quarter ended June 30, 2002 SPA (the foregoing being referred to as "Existing Defaults"an “Anticipated SPA Default”). Hereinafter, the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result of the Existing Defaults, Bank is entitled to exercise its remedies as provided in the Existing Loan Documents and as provided under applicable law. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of any of the terms set forth in this Agreement, (b) the occurrence of any default (other than the Existing Defaults) under the Existing Loan Documents, or (c) if any recitalfailure to comply with the covenants set forth in Sections 5.3(a), representation 5.3(c), or warranty made 5.10 of the Credit Agreement (an “Anticipated Credit Agreement Default,” and together with the Anticipated SPA Defaults, the “Anticipated Defaults”), for the period commencing on the Effective Date and ending on the Forbearance Termination Date (as defined below) (the “Forbearance Period”). (ii) As used herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf of the Borrower in connection with this Agreement or any other document executed and delivered in connection with this Agreement, shall prove to have been false, incomplete or misleading in any material respect on “Forbearance Termination Date” means the date as of which it was made (collectively, a "Default"), whereupon Bank, at its option, without any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under that is the Existing Loan Documents until the end of the Forbearance Period earliest of: (a) in no way June 14, 2023; provided that (1) such date shall be deemed an agreement automatically extended by Bank sixty (60) days (a “Forbearance Extension”) if the Borrowers execute a Term Sheet for a Payoff Transaction in form and substance satisfactory to waive Borrower's compliance with all other terms of the Existing Loan DocumentsLender in its sole discretion, as modified by this Loan Modification provided that any such Forbearance Extension and Forbearance Agreement and (b) shall not limit or impair Bank's right to demand strict performance of all other terms and covenants as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of the Existing Defaults. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not automatically terminate and the Forbearance Termination Date shall automatically occur if (x) such Term Sheet is terminated or ongoing discussions with respect to the transaction that is the subject of such Term Sheet shall cease for any reason, or any party thereto indicates that it is no longer pursuing the transaction contemplated by the Term Sheet, unless prior to such termination, the Borrowers have entered into a new Term Sheet for a Payoff Transaction in form and substance satisfactory to Lender in its sole discretion, (y) the Borrowers’ Board of Directors passes a resolution or consent which would approve the filing or commencement of an Insolvency Proceeding, or (z) if the parties thereto modify, amend, or otherwise alter the Term Sheet such that the proposed transaction would no longer be affected by reason of this Agreementa Payoff Transaction, and (2) such date may be further extended if agreed in writing by the Lender and the Borrowers; (b) the date on which any Borrower commences, or threatens in writing to commence, any litigation against the Lender; (c) the date on which any Borrower takes any action inconsistent with the Lender’s interests in the Collateral; (d) the commencement of any Insolvency Proceeding by or against any Borrower; provided that the Lender shall not assert as a defense thereto participate in commencing any involuntary Insolvency Proceeding against any Borrower during the Forbearance Period, (e) the departure of any member of Borrowers’ senior management, or (f) the occurrence or existence of any default or Event of Default hereunder or under the Transaction Documents, or any event or circumstance which, with notice or the passage of time, estoppelshall become an Event of Default (an “Unmatured Default”), laches other than the Existing Defaults or the Anticipated Defaults. For purposes of clarity, failure of the Borrowers to satisfy any of the covenants herein will also constitute an immediate Event of Default for purposes of determining the Forbearance Termination Date. An “Insolvency Proceeding” means any case or proceeding commenced by or against a Person under any state, federal or foreign law for, or any statute agreement of limitations to such Person to, (1) the extent that entry of an order for relief under the exercise United States Bankruptcy Code (Title 11 of the United States Code, 11 U.S.C. §101, et seq.), or any Default Rights was precluded by this Agreementother insolvency, debtor relief or debt adjustment law; (2) the appointment of a receiver, trustee, liquidator, administrator, conservator or other custodian for such Person or any part of its Property; or (3) an assignment or trust mortgage for the benefit of creditors.

Forbearance. Bank agrees The Required Lenders hereby agree to forbear from exercising its rights and any remedies under the Existing Loan Documents and at law ("Default Rights") until the earlier of (a) October 30, 2002, or (b) the occurrence of a Default under this Agreement (the "Forbearance Period"), notwithstanding Borrower's existing default under the Loan Agreement as a result of Borrower's failure to comply with the profitability covenant set forth in Section 6.2 9.2 of the Loan Credit Agreement for the fiscal quarter ended June 30, 2002 (the foregoing being referred to as "Existing Defaults"). Hereinafter, the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges reason of any Default or Event of Default that it is currently in default and may exist solely as a result of the Existing DefaultsBorrower’s failure to timely (i) file with the Securities and Exchange Commission its Form 10-Q for the fiscal quarters ended March 31, Bank is entitled 2005 and June 30, 2005 (the “First and Second Quarter Form 10-Q”) and Form 10-K for the fiscal year ended December 31, 2004 (the “2004 Form 10-K”), including, without limitation, compliance with Sections 7.1 and 7.4 of the Credit Agreement with respect thereto (collectively, the “Filing Default”) and (ii) deliver the unaudited consolidated balance sheets, statements of income, cash flows and stockholders’ equity for the Credit Parties and their Subsidiaries for the fiscal quarters ended March 31, 2005 and June 30, 2005 and the audited consolidated balance sheets, statements of income, cash flows and stockholders’ equity for the Credit Parties and their Subsidiaries for the fiscal year ended December 31, 2004, together with any opinions and reports contemplated under Section 7.1 of the Credit Agreement (collectively, the “Delivery Default”). This forbearance shall be effective as of August 1, 2005 and shall run through October 31, 2005 (the “Forbearance Period”). This forbearance relates only to exercise the Filing Default or the Delivery Default and shall not be construed to be (a) a waiver as to future compliance to timely deliver any future Form 10-Q, Form 10-K or its remedies financial statements, including, without limitation, as provided required in the Existing Loan Documents last sentence of this Section 2 and as required for subsequent fiscal quarters or years, or to otherwise comply with any other covenant in the Credit Agreement or (b) a waiver of any other Default or Event of Default that may exist. This forbearance shall not be deemed to be a modification or amendment to the Credit Agreement and the Credit Agreement is hereby ratified and confirmed in all respects and shall remain in full force and effect in accordance with its terms except as modified herein. Notwithstanding the foregoing forbearance, (x) the Borrower shall be in violation of Section 7.4 of the Credit Agreement, and the forbearance provided under applicable lawfor herein shall not apply, if it has not filed its First and Second Quarter Form 10-Q and 2004 Form 10-K with the Securities and Exchange Commission, on or before October 31, 2005 and (y) the Borrower shall be in violation of Section 7.1 of the Credit Agreement, and the forbearance provided for herein shall not apply, if it has not delivered the financial statements, reports and opinions required by Section 7.1 of the Credit Agreement for the fiscal year ended December 31, 2004 and the fiscal quarters ended March 31, 2005 and June 30, 2005, on or before the earlier of (1) October 31, 2005 and (2) the date such financial statements, reports and opinions are available. The To the extent the Delivery Default and the Filing Default have been cured on or before October 31, 2005, such Defaults shall not be the sole basis for any exercise of the Lenders’ rights and remedies against the Borrower. Furthermore, the Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches terminate upon the occurrence of any of the terms set forth in this Agreement, following: (ba) the occurrence a Default or Event of any default Default (other than the Existing DefaultsFiling Default and Delivery Default) under the Existing Loan Credit Documents, or (c) if any recital, representation or warranty made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf of the Borrower in connection with this Agreement or any other document executed and delivered in connection with this Agreement, shall prove to have been false, incomplete or misleading in any material respect on the date as of which it was made (collectively, a "Default"), whereupon Bank, at its option, without any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end of the Forbearance Period (a) in no way shall be deemed an agreement by Bank to waive Borrower's compliance with all other terms of the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement and ; or (b) shall not limit or impair Bank's right to demand strict performance of all other terms and covenants as any Credit Party’s breach of any date. Nothing in obligation under this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of the Existing Defaults. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations to the extent that the exercise of any Default Rights was precluded by this AgreementAmendment.

Forbearance. Bank Subject to all of the other terms and conditions set forth herein, and (a) solely with respect to any defaults or breaches arising out of the Specified Events, Holder agrees to forbear from exercising its rights and remedies under the Existing Loan Documents May Note and at law Security Agreement ("it being understood that nothing herein shall constitute a waiver of any Event of Default Rights"pursuant to the May Note or the Security Agreement) solely during the period from the date hereof until that date (the earlier “Forbearance Termination Date”) which is the earliest to occur of (ai) October 30the failure after the date hereof of the Company to comply with any of the terms or undertakings of this Agreement, 2002including, without limitation, the covenants set forth in Section 4 hereof, (ii) a breach of any warranty or representation of the Company in this Agreement, or (biii) the occurrence of a different Event of Default (other than a default arising out of the Specified Events) under this Agreement (either the "February Note or the May Note. Upon the Forbearance Period")Termination Date, notwithstanding Borrower's existing default the agreement of Holder to forbear from exercising its rights and remedies in respect of the Specified Events shall automatically terminate for all purposes under the Loan May Note and Security Agreement as a result for all periods, including periods after the Forbearance Termination Date and Holder shall be free to proceed to enforce any or all of Borrower's failure to comply with the profitability covenant its rights and remedies set forth in Section 6.2 the May Note or the Security Agreement including, without limitation, the right to demand the immediate repayment of the Loan Agreement for the fiscal quarter ended June 30, 2002 (the foregoing being referred May Note and to as "Existing Defaults"). Hereinafter, the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result take possession of the Existing Defaultscollateral under the Security Agreement. The Company hereto agrees that, Bank is entitled subject to exercise the agreement of Holder to forbear from exercising certain of its rights and remedies as provided in and to the Existing Loan Documents and as provided under applicable law. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of any of the terms extent expressly set forth in this Agreement, (b) the occurrence all rights and remedies of any default (other than the Existing Defaults) Holder under the Existing Loan Documents, or (c) if any recital, representation or warranty made herein, in any document executed May Note and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf of the Borrower in connection with this Security Agreement or any other document executed shall continue to be available to Holder from and delivered in connection with this Agreement, shall prove to have been false, incomplete or misleading in any material respect on after the date as of which it was made (collectively, a "Default"), whereupon Bank, at its option, without any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end of the Forbearance Period (a) in no way shall be deemed an agreement by Bank to waive Borrower's compliance with all other terms of the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement and (b) shall not limit or impair Bank's right to demand strict performance of all other terms and covenants as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of the Existing Defaults. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations to the extent that the exercise of any Default Rights was precluded by this Agreement.

Forbearance. Bank 3.1 IFC hereby agrees to forbear from exercising its rights the Forbearance upon and remedies under subject to the Existing Loan Documents terms and at law ("Default Rights") conditions of this Agreement. The Forbearance will take effect on the Effective Date and will continue until the earlier of of: (ai) October 3012:00 pm (New York time) on March 31, 2002, 2016; or (bii) the occurrence of a Default under this Agreement Termination Date (the "Forbearance Period"). 3.2 The Forbearance will take effect and the Forbearance Period will begin on the date when IFC notifies the Borrowers in writing that the following conditions have been met in form and substance satisfactory to IFC or waived in writing by IFC (the "Effective Date"): (a) this Agreement has been executed by each of the parties hereto; (b) IFC has received copies of Board Resolutions of the Parent Company authorising the execution, notwithstanding Borrower's existing default delivery and performance by the applicable Ultrapetrol Entity of this Agreement; (c) IFC shall have received a fee equal to$15,000, no later than January 15, 2016; (d) IFC shall have received fully executed copies of Third Party Forbearance Agreements entered into by the applicable Ultrapetrol Entity and applicable creditor on or prior to the Effective Date; and (e) the Borrowers agree to (x) pay all fees and expenses of a legal advisor and a financial advisor to be retained jointly by IFC and OFID in their sole discretion (including the determination of the scope of work to be conducted by such advisors) in connection with the negotiation and documentation of a restructuring transaction (in or outside of a court in (or outside of) the United States of America); (y) indemnify IFC for all pending and outstanding fees of the legal advisor and financial advisor to the extent they have not been paid by the Borrowers within 5 business days after receipt of an invoice and (z) fully cooperate and cause each other Obligor to fully cooperate with the legal advisor and the financial advisor. 3.3 Subject to Sections 5 and 7, during the Forbearance Period, IFC agrees not to enforce any of its rights and remedies under the Loan Agreement Transaction Documents relating to, and will not otherwise bring any litigation, arbitration or other judicial or quasi-judicial proceeding in connection with or solely as a result of Borrower's failure to comply with the profitability covenant set forth in Section 6.2 of the Loan Agreement for the fiscal quarter ended June 30, 2002 (the foregoing being referred to as "Existing Defaults"). Hereinafterof, the Existing Loan Current Events of Default, whether directly or by enforcement of its rights under the Security Documents, as modified . 3.4 The entering into by IFC and the performance by it of its agreements and obligations under this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result of the Existing Defaults, Bank is entitled to exercise its remedies as provided in the Existing Loan Documents and as provided under applicable law. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of prejudice to any of IFC's rights with respect to the terms set forth in this AgreementCurrent Events of Default, (b) the occurrence of any default (other than the Existing Defaults) under the Existing Loan Documents, or (c) if any recital, representation or warranty made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished which may be asserted by or on behalf of the Borrower in connection with this Agreement or any other document executed and delivered in connection with this Agreement, shall prove to have been false, incomplete or misleading in any material respect on the date as of which it was made (collectively, a "Default"), whereupon Bank, IFC at its option, without any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end of the Forbearance Period (a) Period, or with respect to any other rights of IFC in no way respect of any other matter. Without limiting the generality of the preservation of rights set forth in Section 7.1, nothing contained in this Agreement is intended or shall be deemed to constitute an acknowledgment, representation, warranty, covenant or other agreement by Bank on the part of IFC that it has agreed or it will agree: (i) to waive Borrower's compliance with all other terms enter into any restructuring of the Existing Loan Documents, as modified by this Loan Modification Borrowers and Forbearance Agreement the other Obligors' obligations and (b) shall not limit or impair Bank's right to demand strict performance of all other liabilities under the Transaction Documents on any terms and covenants as conditions; (ii) to grant any forbearance relating to any Potential Event of Default or Event of Default other than the Current Events of Default; or (iii) to grant any forbearance relating to the Current Events of Default beyond the end of the Forbearance Period, and no such agreement may be implied by anything in this Agreement. Each Borrower and each of the Obligors acknowledges that IFC has not made any assurances whatsoever concerning any possibility of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver extensions of the Existing Defaults. Borrower further agrees that Forbearance Period, any other standstill, forbearance or similar arrangement or any other limitations on the exercise of any Default Rights by Bank upon termination its rights, remedies and privileges under or otherwise in connection with the Transaction Documents or applicable law. 3.5 Each Borrower and each of the other Obligors agrees that notwithstanding their respective entry into the Forbearance Period or the termination thereof, all of their respective obligations under the IFC Loan Agreement, the Security Documents and any other Transaction Documents to which it is a party are and continue to be in full force and effect, and are not, except as otherwise expressly provided herein, varied, amended, modified, waived or released in any manner, including during the Forbearance Period. Except as otherwise expressly provided herein, neither the Borrowers nor any other Obligor shall be released or otherwise excused from complying with any provisions of any of the Transaction Documents. Each Borrower also acknowledges that the absence at the date of this Agreement of notices from IFC with respect to any Events of Default other than the Current Events of Default does not be affected amount to any waiver by reason IFC of those Events of Default. 3.6 Notwithstanding Section 3.3 hereof, the Borrowers and each Obligor shall comply, except to the extent such compliance is excused by the terms of this Agreement, and with all explicit restrictions or prohibitions triggered by the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches existence or any statute of limitations to the extent that the exercise continuation of any Potential Event of Default Rights was precluded by this Agreementor Event of Default under the IFC Loan Agreement and each other Transaction Document.

Forbearance. Bank agrees During the period (the “Forbearance Period”) commencing on the date hereof and ending on the date of any Forbearance Default (as defined below), and subject to the satisfaction of the conditions set forth in Section 2 hereof, the Agents and the Lenders will forbear from exercising its their rights and remedies under the Existing Credit Agreement and the other Loan Documents and at law ("Default Rights") until the earlier of (a) October 30, 2002, or (b) the occurrence of a Default under this Agreement (the "Forbearance Period"), notwithstanding Borrower's existing default under the Loan Agreement as a result of Borrower's failure solely with respect to comply with the profitability covenant set forth in Section 6.2 of the Loan Agreement for the fiscal quarter ended June 30, 2002 (the foregoing being referred to as "Existing Defaults"). Hereinafter, the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result of the Existing Defaults, Bank is entitled to exercise its remedies as provided in the Existing Loan Documents and as provided under applicable law. The “Forbearance Period Default” shall be immediately terminated, without notice, if mean: (ai) Borrower breaches an Event of any of the terms set forth in this Agreement, (b) the occurrence of any default Default (other than the Existing Defaults), (ii) under the Existing Loan Documentsfailure of either Borrower to keep or perform any of the covenants or agreements contained herein providing for a payment or prepayment to the Agents or the Lenders, (iii) the failure of either Borrower to keep or perform any of the covenants or agreements contained herein (cother than those referred to in clause (ii) if above) two Business Days after the date the Borrowers receive written notice from an Agent of any recitalsuch failure (the “Notice Period”), provided that in the event any such failure is remedied within the Notice Period, such failure shall not constitute a Forbearance Default, (iv) any representation or warranty of either Borrower herein shall be incorrect when made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf of the Borrower in connection with this Agreement or any other document executed and delivered in connection with this Agreement, shall prove to have been false, incomplete or misleading deemed made in any material respect on respect, (v) the date as U.S. Borrower and LHPG shall not have filed the Disclosure Statement and Plan by February 28, 2002, (vi) the U.S. Borrower and LHPG file, propound or otherwise support any plan of which reorganization other than the Plan or other creditors of the U.S. Borrower or of LHPG file any plan of reorganization other than the Plan in accordance with Section 1121(c) of the Bankruptcy Code, (vii) the Plan is modified or replaced such that it was made (collectivelyor any such replacement) at any time is not consistent in all material respects with the Senior Debt Term Sheet, (viii) the definitive documentation for the Plan and Disclosure Statement provides, or is modified to provide, for any terms that are not consistent in all material respects with the Senior Debt Term Sheet, (ix) the U.S. Borrower or LHPG shall withdraw or revoke the Plan or the U.S. Borrower or LHPG shall publicly announce its intention not to pursue the Plan, (x) an examiner with expanded powers or a "Default")trustee shall have been appointed or elected in the Chapter 11 Case, whereupon Bankthe Chapter 11 Case shall have been converted to a case under chapter 7 of the Bankruptcy Code, at its optionor the Chapter 11 Case shall have been dismissed by order of the Bankruptcy Court for the District of Delaware and (xi) any other event shall occur, without the effect or result of which, is the termination of any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end of the Forbearance Period (a) in no way shall be deemed an agreement by Bank to waive Borrower's compliance with all other terms of the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement and (b) shall not limit or impair Bank's right to demand strict performance of all other terms and covenants Lock-Up Agreements dated as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of November 19, 2001 among the Existing Defaults. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this AgreementU.S. Borrower, LHPG and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations to the extent that the exercise of any Default Rights was precluded by this Agreement“Consenting Holder” party thereto.

Forbearance. Bank agrees to forbear from exercising its rights and remedies under the Existing Loan Documents and at law ("Default Rights") until the earlier of (a) October 307, 20022003, or (b) the occurrence of a Default under this Agreement (the "Forbearance Period"), notwithstanding Borrower's existing default under the Loan Agreement as a result of Borrower's failure to comply with the profitability Tangible Net Worth covenant set forth in Section 6.2 6.7 of the Loan Agreement, through the day of this Loan Modification and Forbearance Agreement for the fiscal quarter ended June 30, 2002 (the foregoing being referred to as "Existing Defaults"). , Hereinafter, the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result of the Existing Defaults, Bank is entitled to exercise its remedies as provided in the Existing Loan Documents and as provided under applicable law. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of any of the terms set forth in this Agreement, (b) the occurrence of any default occurs (other than the Existing Defaults) under the Existing Loan Documents, or (c) if any recital, representation or warranty made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf of the Borrower in connection with this Agreement or any other document executed and delivered in connection with this Agreement, shall prove to have been false, incomplete or misleading in any material respect on the date as of which it was made (collectively, a "Default"), whereupon Bank, at its option, without any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end of the Forbearance Period (a) in no way shall be deemed an agreement by Bank to waive Borrower's compliance with all other terms of the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement and (b) shall not limit or impair Bank's right to demand strict performance of all other terms and covenants as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of the Existing Defaults. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations to the extent that the exercise of any Default Rights was precluded by this Agreement.

Forbearance. Bank The Lender agrees to that it will forbear from exercising any of its rights and or remedies under the Existing Loan Documents and at law ("Default Rights") as the result of the Specified Defaults, until the earlier earliest to occur of the following: (a) October 30any Additional Event of Default occurs under the Loan Documents; (b) any representation or warranty of the Borrower made herein or in the Loan Documents shall prove to be false, 2002misleading, or incorrect in any material respect; (c) the occurrence after the Fifth Amendment Date of any event that could be a Material Adverse Occurrence other than the Specified Defaults; (d) any judicial, administrative, or arbitration proceeding is initiated or joined by the Borrower against the Lender; and (e) April 1, 2021 (the “Forbearance Termination Date”) (each, a “Forbearance Termination Event”). The foregoing agreement to forbear is for the limited purpose set forth herein, shall be limited to the precise meaning of the words as written herein, and shall not be deemed to (x) be a consent to any waiver or modification of any term or condition of the Loan Documents, except as otherwise expressly set forth herein, or (by) subject to giving effect to this Amendment, prejudice any right or remedy that the occurrence of a Default Lender may now have or may have in the future under this Agreement (the "Forbearance Period"), notwithstanding Borrower's existing default under the Loan Agreement as a result of Borrower's failure to comply or in connection with the profitability covenant set forth in Section 6.2 of the Loan Agreement for the fiscal quarter ended June 30, 2002 (the foregoing being referred to as "Existing Defaults"). Hereinafter, the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called including, without limitation, any right to apply proceeds of the "Loan Documents"Security Documents Collateral to the Obligations. By signing below, The Borrower acknowledges that it is currently in default and as a result of the Existing Defaults, Bank is entitled Lender has no obligation to exercise its remedies as provided in extend the Existing Loan Documents and as provided under applicable law. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of any of the terms set forth in this Agreement, (b) the occurrence of any default (other than the Existing Defaults) under the Existing Loan DocumentsPeriod, or (c) if any recital, representation or warranty made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf of the Borrower in connection with this Agreement or to grant any other document executed forbearance. All reasonable expenses incurred by the Lender in entering, administering, and delivered in connection with enforcing this Agreement, shall prove to have been false, incomplete or misleading in any material respect on the date as of which it was made (collectively, a "Default"), whereupon Bank, at its option, without any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end of the Forbearance Period (a) in no way shall be deemed an agreement by Bank to waive Borrower's compliance with all other terms of the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement and (b) shall not limit or impair Bank's right to demand strict performance of all other terms and covenants as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of will be reimbursed by the Existing Defaults. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations to the extent that the exercise of any Default Rights was precluded by this AgreementBorrower.

Forbearance. Bank (a) Effective as of the Forbearance Effective Date, the Noteholder agrees to that, until the expiration of the Forbearance Period (as defined below), it will forbear from exercising its exercising, and shall direct the Trustee and any broker or other Person that holds the Notes on behalf of the Noteholder, and by signature hereto so direct the Trustee pursuant to Article VI of the Indenture and such brokers or other Persons, not to exercise, any rights and remedies against Issuer that are available under the Existing Loan Documents Indenture and/or applicable law solely with respect to Interest Default; provided, however, that, except as otherwise expressly provided herein, nothing herein shall restrict, impair or otherwise affect the exercise of the Noteholder’s rights under this Agreement or the Indenture, and provided further that no such forbearance shall constitute a waiver with respect to any Defaults or Events of Default under the Indenture or a waiver of any of the rights and remedies provided thereunder, under applicable law, at law equity or otherwise. ("Default Rights"b) until As used herein, the term “Forbearance Period” shall mean the period beginning on the Forbearance Effective Date and ending upon the occurrence of a Termination Event. As used herein, “Termination Event” shall mean the earlier to occur of (ai) October 30December 19, 2002, or 2008; and (bii) the occurrence of any Forbearance Default; provided, however, that if, on or before December 19, 2008, the Issuer and Noteholder enter into a Default under this Agreement mutually satisfactory confidentiality agreement and the Issuer delivers to the Noteholder (X) a copy of the "Forbearance Period")13-week cash flow statement of the Issuer and (Y) the budget for the 2009 fiscal year of the Issuer, notwithstanding Borrower's existing default under the Loan Agreement as a result of Borrower's failure to comply with the profitability covenant then such date set forth in Section 6.2 1(b)(i) above shall be extended to January 15, 2009. As used herein, the term “Forbearance Default” shall mean: (A) the occurrence of any Default or Event of Default other than the Interest Default; (B) the failure of the Loan Agreement for the fiscal quarter ended June 30Issuer to comply with any material term, 2002 (the foregoing being referred to as "Existing Defaults"). Hereinaftercondition, the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result of the Existing Defaults, Bank is entitled to exercise its remedies as provided in the Existing Loan Documents and as provided under applicable law. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of any of the terms covenant or agreement set forth in this Agreement, ; (bC) the occurrence failure of any default (other than the Existing Defaults) under the Existing Loan Documents, or (c) if any recital, representation or warranty made herein, by the Issuer under this Agreement to be true and correct in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished all material respects as of the date when made; (D) the commencement by or on behalf against the Issuer of a case under title 11 of the Borrower in connection with this Agreement United States Code, the Companies’ Creditors Arrangement Act or any other document executed and delivered in connection with this Agreement, shall prove act that seeks relief under any comparable bankruptcy or insolvency regime or proceeding; (E) the failure of the Issuer to have been false, incomplete or misleading in any material respect on the date as of which it was made (collectively, a "Default"), whereupon Bank, at its option, without any notice adequate availability and ability to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights borrow under the Existing Loan Documents until Floor Plan Credit Facility to meet its current operating cash needs; or (f) the end acceleration of the Forbearance Period (a) in no way shall be deemed an agreement by Bank Notes pursuant to waive Borrower's compliance with all other terms Section 6.1 of the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement and (b) shall not limit or impair Bank's right to demand strict performance of all other terms and covenants as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of the Existing Defaults. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations to the extent that the exercise of any Default Rights was precluded by this AgreementIndenture.

Forbearance. Bank agrees to forbear forebear until March 31, 2005 (the “Forbearance Period”) from exercising its rights and remedies under the Existing Loan Documents and at under applicable law ("“Default Rights") until the earlier of (a) October 30, 2002, or (b) the occurrence of a Default under this Agreement (the "Forbearance Period"”), notwithstanding Borrower's ’s existing default under the Loan Agreement as a result of Borrower's ’s failure to comply with maintain the profitability covenant set forth in minimum Adjusted Tangible Net Worth required by Section 6.2 5 of the Schedule to the Loan Agreement for the fiscal quarter ended June 30, 2002 (the foregoing being referred to as "the “Existing Defaults"Default”). Hereinafter, the The Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called the "“Loan Documents"”). By signing below, Borrower acknowledges that it is currently in default and as a result of the Existing Defaultssuch default, Bank is entitled to exercise its remedies the Default Remedies. Nothing in this Agreement in any way shall constitute Bank’s waiver of Borrower’s Existing Default. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as provided in a defense thereto the Existing Loan Documents and as provided under applicable lawpassage of time, estoppel, laches or any statute of limitations to the extent that the exercise of any Default Rights was precluded by this Agreement. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of any of the terms set forth in this Agreement, (b) the occurrence of any default (other than the Existing DefaultsDefault) under the Existing Loan Documents, or (c) if any recital, representation or warranty made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf of the Borrower in connection with this Agreement or any other document executed and delivered in connection with this Agreement, shall prove to have been false, incomplete or misleading in any material respect on the date as of which it was made (collectively, a "“Default"”), whereupon Bank, at its option, without any notice to Borrower, may immediately cease making any Advances Loans and may immediately exercise any Default RightsRemedies. Upon termination of the Forbearance Period described above, without any notice to Borrower, Bank may exercise any remedies available to Bank under the Loan Documents and under applicable law. In addition, Bank's ’s agreement to continue to forbear from enforcing its Default Rights remedies under the Existing Loan Documents until the end of the Forbearance Period Period, notwithstanding Borrower’s Existing Default under the Existing Loan Documents, (a) in no way shall be deemed an agreement by Bank to waive Borrower's ’s compliance with all other terms of the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement and (b) shall not limit or impair Bank's ’s right to demand strict performance of all other terms and covenants as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of the Existing Defaults. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations to the extent that the exercise of any Default Rights was precluded by this Agreement.

Forbearance. Bank Events of Default have occurred and are continuing under Sections 8.1(a) and 8.1(b) of the Credit Agreement as a result of the Borrower's failure to make certain prepayments required under Section 2.5(b)(ii) of the Credit Agreement and the non-compliance with the covenants contained in Sections 7.14, 7.15 and 7.16 of the Credit Agreement. As a result of such Events of Default, Lender is no longer obligated to make Loans to Borrower and is also entitled to accelerate payment of all Loans and to exercise certain other rights and remedies specified in the Credit Agreement. As an accommodation to Borrower while not waiving any such Events of Default, but subject to compliance by Borrower with the terms and conditions hereinafter set forth, Lender agrees to forbear (i) forebear through January 25, 2001 from accelerating the Loans or exercising its any rights and remedies to which it is entitled as a result of the occurrence thereof except as provided herein and (ii) continue to extend Loans to the Borrower on the terms and conditions set forth in the Credit Agreement as amended hereby. This forbearance agreement is conditioned upon compliance by the Borrower with the following: (a) On or before October 27, 2000, Borrower shall prepay the Loans in a minimum amount sufficient to reduce the principal amount of Loans made against all Mortgage Loans to an amount not in excess of the Borrowing Base as then determined and computed; (b) On or before October 27, 2000, Ronald J. Sheppard shall execute a▇▇ ▇▇▇▇▇▇▇ ▇ ▇▇▇▇▇nty of Borrower's obligations to Lender satisfactory to the Lender. (c) On or before October 27, 2000, Borrower shall have satisfied all repurchase obligations owing by it to Household Financial Services, Inc. This agreement shall not establish a custom or course of dealing and does not waive, limit or postpone any of Borrower's obligations under the Credit Agreement, any of the Loan Documents or otherwise, and any discussions (written or oral) which have occurred or which may hereafter occur are not, and shall not be deemed to be, a waiver, limitation or postponement of any of Lender's rights and remedies under the Existing Credit Agreement, any of the Loan Documents or applicable law, all of which rights and at law ("Default Rights") remedies are expressly reserved. This agreement shall not become effective until the earlier of (a) October 30, 2002, or (b) the occurrence of a Default under this Agreement (the "Forbearance Period"), notwithstanding Borrower's existing default under the Loan Agreement as a result of Borrower's failure to comply with the profitability covenant conditions precedent set forth in Section 6.2 3 hereof have been satisfied. This agreement shall expire on January 25, 2001 at which time all terms and conditions of the Loan Credit Agreement shall apply without giving effect to the forebearance provided for the fiscal quarter ended June 30, 2002 (the foregoing being referred to as "Existing Defaults"). Hereinafter, the Existing Loan Documents, as modified by this Loan Modification herein and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result of the Existing Defaults, Bank is Lender shall be entitled to exercise its all rights and remedies as provided in the Existing Loan Documents and as provided under applicable law. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches available to it on account of any Event of Default, whether existing as of the terms set forth in this Agreement, (b) the occurrence of any default (other than the Existing Defaults) under the Existing Loan Documents, date hereof or (c) if any recital, representation or warranty made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf of the Borrower in connection with this Agreement or any other document executed and delivered in connection with this Agreement, shall prove to have been false, incomplete or misleading in any material respect on the date as of which it was made (collectively, a "Default"), whereupon Bank, at its option, without any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end of the Forbearance Period (a) in no way shall be deemed an agreement by Bank to waive Borrower's compliance with all other terms of the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement and (b) shall not limit or impair Bank's right to demand strict performance of all other terms and covenants as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of the Existing Defaults. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations to the extent that the exercise of any Default Rights was precluded by this Agreementotherwise.

Forbearance. Bank agrees Amendment to forbear from exercising its rights and remedies under the Existing Loan Documents and at law ("Default Rights") until Agreement ----------------------------------------. Until the earlier of (a) October 30August 31, 20021998, or (b) the occurrence date on which Borrower retires the outstanding principal balance of a Default the Revolving Line and of the New Note (defined at Section 4), Lender shall not exercise any remedy available to it under the Loan Agreements by reason of any default existing under the Loan Agreements as of the date of this Agreement; provided, however, that the Loan Agreement is hereby amended so that: (i) From and after the date of this Agreement, Lender shall have no obligation to make any further advance to Borrower under the Loan Agreement in respect of the Revolving Line, the outstanding principal balance of which is fixed as of the date of this Agreement at the amount set forth in Schedule 1.2; (ii) Effective September 1, 1998, the "Forbearance Period")interest rate applicable to the Revolving Line and to the Term Loans shall be the greater of (a) the interest rate applicable under the New Note, notwithstanding Borrower's existing or (b) the interest rate applicable thereto under the Loan Agreement; (iii) Effective on and as of the date on which Lender has paid and discharged in full its obligation to the Bank of America in respect of the purchase price payable for the Loan Agreements, a default under the New Note (after giving effect to any notice and cure periods provided therein) shall constitute a default under the Loan Agreement as a result of Borrower's failure to comply with Agreements; and (iv) Effective on the profitability covenant set forth in Section 6.2 later of the Loan Agreement date on which Lender has paid and discharged in full its obligation to the Bank of America in respect of the purchase price payable for the fiscal quarter ended June 30Loan Agreements, 2002 (the foregoing being referred to as "Existing Defaults"). Hereinafteror September 1, 1998, the Existing Loan Documents, as modified by this Loan Modification Term Loans shall be due and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result of the Existing Defaults, Bank is entitled to exercise its remedies as provided in the Existing Loan Documents and as provided under applicable lawpayable on demand. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of any of the terms Lender's agreement to forbear set forth in this Agreement, (b) Section 3 shall replace and supersede in their entirety all prior agreements between the occurrence Bank of any default (other than America and Borrower concerning the Existing Defaults) Bank's forbearance under the Existing Loan Documents, or (c) if any recital, representation or warranty made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf of the Borrower in connection with this Agreement or any other document executed and delivered in connection with this Agreement, shall prove to have been false, incomplete or misleading in any material respect on the date as of which it was made (collectively, a "Default"), whereupon Bank, at its option, without any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end of the Forbearance Period (a) in no way shall be deemed an agreement by Bank to waive Borrower's compliance with all other terms of the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement and (b) shall not limit or impair Bank's right to demand strict performance of all other terms and covenants as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of the Existing Defaults. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations to the extent that the exercise of any Default Rights was precluded by this AgreementAgreements.

Forbearance. Bank agrees to (a) Effective as of the Fourth Amended Forbearance Effective Date (as defined below), the Noteholders agree that, until the expiration of the Fourth Forbearance Period (as defined below), they will forbear from exercising its exercising, and shall direct the Indenture Trustee, and by signature hereto so direct the Indenture Trustee pursuant to Section 6.5 of the Indenture, not to exercise, any rights and remedies against the Company or the Subsidiaries that are available under the Indenture, the Intercreditor Agreement, the Collateral Agreements and/or applicable law solely with respect to the Specified Existing Loan Documents Defaults (excluding, however, the Noteholders’ right to charge default interest on the Notes (including on all unpaid interest on the Notes to the extent provided under the Indenture) during the Fourth Forbearance Period); provided, however, that nothing herein shall restrict, impair or otherwise affect the exercise of the Noteholders’ rights under this Fourth Amended Forbearance Agreement, and at law ("provided further that no such forbearance shall constitute a waiver with respect to any such Specified Existing Defaults or any other Events of Default Rights") until under the earlier of (a) October 30, 2002, or Indenture. (b) As used herein, the term “Fourth Forbearance Period” shall mean the period beginning on the date hereof and ending upon the occurrence of a Default under this Agreement (the "Forbearance Period"), notwithstanding Borrower's existing default under the Loan Agreement as a result of Borrower's failure to comply with the profitability covenant set forth in Section 6.2 of the Loan Agreement for the fiscal quarter ended June 30, 2002 (the foregoing being referred to as "Existing Defaults")Termination Event. Hereinafter, the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result of the Existing Defaults, Bank is entitled to exercise its remedies as provided in the Existing Loan Documents and as provided under applicable law. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of any of the terms set forth in this Agreement, (b) the occurrence of any default (other than the Existing Defaults) under the Existing Loan Documents, or (c) if any recital, representation or warranty made As used herein, in any document executed and delivered in connection herewith“Termination Event” shall mean the earlier to occur of (i) December 6, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf of the Borrower in connection with this Agreement or any other document executed and delivered in connection with this Agreement, shall prove to have been false, incomplete or misleading in any material respect on the date as of which it was made (collectively, a "Default"), whereupon Bank, at its option, without any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end of the Forbearance Period (a) in no way shall be deemed an agreement by Bank to waive Borrower's compliance with all other terms of the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement 2007; and (bii) shall not limit or impair Bank's right to demand strict performance of all other terms and covenants as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of two business days after the Existing Defaults. Borrower further agrees that delivery by the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations Noteholder Group to the extent that Company and Lender of a written notice terminating the exercise of any Default Rights was precluded by this Agreement.Fourth Forbearance

Forbearance. Bank agrees to (a) Effective as of the Forbearance Effective Date (as defined below), the Noteholders agree that, until the expiration of the Forbearance Period (as defined below), they (both individually and collectively) will forbear from exercising its exercising, and shall direct the applicable Indenture Trustee and any broker or other Person that holds the Notes on behalf of such Noteholders, and by signature hereto so direct the applicable Indenture Trustee pursuant to Sections 502, 507 and 512 of the applicable Indenture and such brokers or other Persons, not to exercise, any rights and remedies against Holdings, the U.S. Issuer, the Canadian Issuer, or the Subsidiaries that are available under the Existing Loan Documents applicable Indenture and/or applicable law solely with respect to the Interest Defaults; provided, however, the Noteholders shall be entitled to assert a right to the accrual of default interest to the extent provided under the applicable Indenture during the Forbearance Period but may not seek any remedy or take any action with respect thereto during the Forbearance Period; provided, however, that nothing herein shall restrict, impair or otherwise affect the exercise of the Noteholders’ rights under this Agreement, and at law provided further that no such forbearance shall constitute a waiver with respect to any Defaults ("other than the Interest Defaults) or any other Events of Default Rights"under the applicable Indenture. (b) until As used herein, the term “Forbearance Period” shall mean the period beginning on the Forbearance Effective Date and ending upon the occurrence of a Termination Event. As used herein, “Termination Event” shall mean the earlier to occur of (ai) October 30December 31, 20022008; and (ii) two (2) Business Days after the delivery by Paul, Weiss, as counsel to the Noteholder Group, to the applicable Issuer and the applicable Indenture Trustee a written notice terminating the Forbearance Period (the “Termination Notice”), which notice may be delivered at any time but only upon or after the occurrence of any Forbearance Default; provided, however, that notwithstanding the foregoing, this Agreement shall immediately terminate upon the occurrence of a Forbearance Default under subsections (A) and (F) below, without the need for delivery of the Termination Notice or any other notice. As used herein, the term “Forbearance Default” shall mean: (A) the valid acceleration of all indebtedness arising under (i) the U.S. Indenture, (ii) the Canadian Indenture or (biii) that certain credit agreement dated as of April 6, 2005 (as amended or modified, the “Credit Agreement”), among the Issuers, as borrowers, Holdings, as guarantor, certain lenders and The Bank of Nova Scotia, as Administrative Agent; (B) the failure of the Issuers and Holdings to engage in good faith negotiations with the Noteholder Group regarding a potential restructuring transaction which determination shall be made by the holders of a majority in principal amount of the Notes issued under the Indentures in good faith and their reasonable discretion; (C) the occurrence of a any Default under this Agreement or Event of Default other than the Interest Defaults; (D) the "Forbearance Period")failure of the U.S. Issuer, notwithstanding Borrower's existing default under the Loan Agreement as a result of Borrower's failure Canadian Issuer, Holdings or the Subsidiaries to comply with the profitability any material term, condition, covenant set forth in Section 6.2 of the Loan Agreement for the fiscal quarter ended June 30, 2002 (the foregoing being referred to as "Existing Defaults"). Hereinafter, the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result of the Existing Defaults, Bank is entitled to exercise its remedies as provided in the Existing Loan Documents and as provided under applicable law. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of any of the terms or agreement set forth in this Agreement, ; (bE) the occurrence failure of any default (other than the Existing Defaults) under the Existing Loan Documents, or (c) if any recital, representation or warranty made hereinby the U.S. Issuer, the Canadian Issuer, Holdings or the Subsidiaries under this Agreement to be true and correct in any document executed and delivered in connection herewithall material respects as of the date when made; (F) the commencement by or against the U.S. Issuer, the Canadian Issuer, Holdings, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf Subsidiary of a case under title 11 of the Borrower in connection with this Agreement United States Code, the Companies’ Creditors Arrangement Act or any other document executed and delivered act that seeks relief under any comparable bankruptcy or insolvency regime or proceeding that is not, in connection with this Agreementthe case of proceedings commenced against the U.S. Issuer, shall prove to have been falsethe Canadian Issuer, incomplete Holdings or misleading in the Subsidiaries, dismissed within five (5) Business Days of commencement; or (G) the U.S. Issuer, the Canadian Issuer, Holdings, or the Subsidiaries pays any material respect on the date as of which it was made (collectivelymanagement, a "Default"), whereupon Bank, at its option, without any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end of the Forbearance Period (a) in no way shall be deemed an agreement by Bank to waive Borrower's compliance with all other terms of the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement and (b) shall not limit sponsor or impair Bank's right to demand strict performance of all other terms and covenants as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of the Existing Defaults. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations consulting fees to the extent that the exercise stockholders of any Default Rights was precluded by this AgreementHoldings or their affiliates.

Forbearance. Bank agrees to forbear forebear from exercising its rights and remedies under the Existing Loan Documents and at law ("Default Rights") until the earlier of (a) October 30August 31, 20022001, (b) the close of a new equity round of the Borrower, or (bc) the occurrence of a Default under this Agreement (the "Forbearance Period"), notwithstanding Borrower's existing default under the Loan Agreement as a result of Borrower's failure to comply with the profitability maximum loss covenant set forth for the period ending 6/30/01 as described in Section 6.2 entitled "Affirmative Covenants" of the Loan Agreement for the fiscal quarter ended June 30, 2002 (the foregoing being referred to as "Existing Defaults"). Hereinafter, the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result of the Existing Defaults, Bank is entitled to exercise its remedies as provided in the Existing Loan Documents and as provided under applicable law. The Forbearance Period shall be immediately terminated, without notice, if (a) Borrower breaches of any of the terms set forth in this Agreement, (b) the occurrence of any default (other than the Existing Defaults) under the Existing Loan Documents, or (c) if any recital, representation or warranty made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf of the Borrower in connection with this Agreement or any other document executed and delivered in connection with this Agreement, shall prove to have been false, incomplete or misleading in any material respect on the date as of which it was made (collectively, a "Default"), whereupon Bank, at its option, without any notice to Borrower, may immediately cease making any further Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end of the Forbearance Period (a) in no way shall be deemed an agreement by Bank to waive Borrower's compliance with all other terms of the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement and (b) shall not limit or impair Bank's right to demand strict performance of all other terms and covenants as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of the Existing Defaults. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations to the extent that the exercise of any Default Rights was precluded by this Agreement.

Forbearance. Bank agrees Upon the satisfaction of each of the conditions precedent ----------- set forth in Section 14 hereof, each of the Agent and the Required Banks hereby agrees, for so long as (a) no Default or Event of Default (other than the 2000 Forbearance Events and the 2001 Forbearance Events, each as defined below), has occurred and is continuing and (b) the Borrower complies with the requirements contained in this Section 1, (w) to forbear from exercising enforcing any of its rights and remedies under Section 9.2 of the Existing Loan Agreement or under any of the other Loan Documents arising solely as a result of the occurrence of any of the 2000 Forbearance Events or the 2001 Forbearance Events, (x) that the Agent and the Banks will not demand accelerated payment of the obligations under Section 9.1 of the Loan Agreement or otherwise cause any of such obligations to become immediately due and payable, except that the Borrower shall in any event continue to be required to make any and all payments (other than payments required by Section 2.5(c) of the Loan Agreement solely as a result of any of the 2000 Forbearance Events or the 2001 Forbearance Events) that are provided for in the Loan Documents and at law this Amendment when and as the same are due and payable pursuant to the terms of the Loan Documents and this Amendment, ("Default Rights"y) until the earlier of that compliance with Sections 5.2 (a) October 30, 2002, or (b) the occurrence solely with respect to Section 4.20 of a Default under this Agreement (the "Forbearance Period"), notwithstanding Borrower's existing default under the Loan Agreement as a result of Borrower's failure to comply with the profitability covenant set forth in Section 6.2 occurrence of the 2000 Forbearance Events and the 2001 Forbearance Events), (b) and (d) of the Loan Agreement for shall be determined without regard to the fiscal quarter ended June 302000 Forbearance Events and the 2001 Forbearance Events, 2002 and (z) that the foregoing being referred Agent and the Banks will not terminate the lending and other credit commitments of the Agent and the Banks under the Loan Agreement prior to the scheduled expiration and termination thereof upon the Maturity, except that all such lending and other credit commitments of the Agent and the Banks under the Loan Documents shall in any event terminate and expire when and as "Existing Defaults")the same are scheduled to do so, pursuant to the terms of the Loan Agreement and this Amendment. HereinafterSo long as no Default or Event of Default, other than the Existing 2000 Forbearance Events or 2001 Forbearance Events, has occurred and is continuing, nothing herein shall be deemed to prevent the Borrower from exercising any right or taking any action otherwise permitted by the Loan Agreement or the other Loan Documents, as modified by this Loan Modification and Forbearance Agreement are hereinafter collectively called which right or action is conditioned upon the "Loan Documents". By signing below, Borrower acknowledges that it is currently in default and as a result absence of the Existing Defaults, Bank is entitled to exercise its remedies as provided in the Existing Loan Documents and as provided under applicable lawany Default or Event of Default. The Forbearance Period forbearances contained in this Section 1 shall be immediately terminated, without notice, if (a) Borrower breaches of any of the terms set forth in this Agreement, (b) the occurrence of any default (other than the Existing Defaults) under the Existing Loan Documents, or (c) if any recital, representation or warranty made herein, in any document executed and delivered in connection herewith, or in any report, certificate, financial statement or other instrument or document previously, now or hereafter furnished by or on behalf of the Borrower in connection with this Agreement or any other document executed and delivered in connection with this Agreement, shall prove to have been false, incomplete or misleading in any material respect contingent on the date as of which it was made (collectively, a "Default"), whereupon Bank, at its option, without any notice to Borrower, may immediately cease making any Advances and may immediately exercise any Default Rights. Bank's agreement to forbear from enforcing its Default Rights under the Existing Loan Documents until the end of the Forbearance Period (a) in no way shall be deemed an agreement by Bank to waive Borrower's compliance with all other terms of the Existing Loan Documents, as modified by this Loan Modification and Forbearance Agreement and (b) shall not limit or impair Bank's right to demand strict performance of all other terms and covenants as of any date. Nothing in this Loan Modification and Forbearance Agreement in any way shall constitute Bank's waiver of the Existing Defaults. Borrower further agrees that the exercise of any Default Rights by Bank upon termination of the Forbearance Period shall not be affected by reason of this Agreement, and the Borrower shall not assert as a defense thereto the passage of time, estoppel, laches or any statute of limitations to the extent that the exercise of any Default Rights was precluded by this Agreement.following requirements: