FIRST PREFERRED SHIP MORTGAGE DATED AS OF

Exhibit 10.1

DATED AS OF

November 16, 2006

MADE BY

[MORTGAGOR]

TABLE OF CONTENTS

		Page

ARTICLE I DEFINITIONS		2
Section 1.01	Certain Defined Terms	2
Section 1.02	Terms Generally; Rules of Construction	4

ARTICLE II REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE MORTGAGOR		5
Section 2.01	Payment and Performance of Note Obligations	5
Section 2.02	Organization	5
Section 2.03	Ownership of Vessel, Warranty and Defense of Title	5
Section 2.04	Compliance with Laws	5
Section 2.05	Operation of Vessel	6
Section 2.06	Claims, Taxes, Fees, Etc	6
Section 2.07	Liens	6
Section 2.08	Notice of Mortgage	7
Section 2.09	Removal of Liens	7
Section 2.10	Libel or Attachment	7
Section 2.11	Maintenance of Vessel	7
Section 2.12	Changes in Vessel	8
Section 2.13	Inspection	8
Section 2.14	Change of Flag or Documentation	8
Section 2.15	Charter of Vessel	9
Section 2.16	Requisition of Title or Use	9
Section 2.17	Notice of Loss, Requisition or Damage	9
Section 2.18	Insurance	9
Section 2.19	Reimbursement of Mortgagee	12
Section 2.20	Reports	12

ARTICLE III MORTGAGE DEFAULTS AND MORTAGE EVENTS OF DEFAULT		13
Section 3.01	Mortgage Defaults and Mortgage Events of Default	13

ARTICLE IV REMEDIES; APPLICATION OF PROCEEDS		13
Section 4.01	Sale, etc	13
Section 4.02	Finality of Sale	14
Section 4.03	Powers and Rights of Mortgagee upon Occurrence of a Mortgage Event of Default	15
Section 4.04	Application of Proceeds	16

ARTICLE V GENERAL POWERS OF MORTGAGEE		16

ARTICLE VI INDEMNITY		17

ARTICLE VII SUNDRY PROVISIONS		17
Section 7.01	Cumulative Remedies; No Waiver	17
Section 7.02	Further Assurances	17

Section 7.03	No Waiver of Preferred Status	1818
Section 7.04	Survival of Agreements	1818
Section 7.05	Notices	1818
Section 7.06	Counterparts; Amendments	1818
Section 7.07	Nature of Agreements Hereunder	1818
Section 7.08	Recording	1818
Section 7.09	Construction	1818
Section 7.10	Governing Law	1918
Section 7.11	Power of Attorney for Registration	1919

SCHEDULE:

I Vessel

II Information for the Purposes of Article 1515 of the Panamanian Commercial Code

THIS FIRST PREFERRED SHIP MORTGAGE, dated as of November 16, 2006 (as amended, modified, supplemented, renewed, restated or replaced, in whole or part, from time to time, this “Mortgage”), is made and given by [MORTGAGOR], a Panamanian company duly organized and existing under the laws of the Republic of Panama, with an address at c/o Vives y Asociados, Edificio Banco Aliado, Octavo Piso, Calle ▇▇▇▇▇▇▇ ▇. ▇▇ ▇▇▇▇▇, Guidad ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇▇ of Panama (the “Mortgagor”), to and in favor of WILMINGTON TRUST COMPANY, a Delaware banking corporation, in its capacity as Trustee under the Indenture referred to below, with an office at ▇▇▇▇▇▇ Square North, ▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇.▇.▇. (acting in such capacity, together with its successors and assigns in such capacity the “Trustee” or the “Mortgagee”).

RECITALS

A. The Mortgagor is the sole owner of the whole of the vessel set forth on Schedule I attached hereto and made a part hereof (hereinafter called the “Vessel”), duly documented in the name of the Mortgagor under the laws of the Republic of Panama.

B. The information required as to this Mortgage for the purposes of Article 1515 of the Panamanian Commercial Code is set forth on Schedule II attached hereto and made a part hereof.

C. Britannia Bulk plc, a company registered in England and Wales (the “Company”), as issuer, and the Mortgagee, as the Trustee for the benefit of the holders of the Notes (as such term is hereinafter defined), are parties to that certain Indenture dated as of November 16, 2006 (said Indenture, as amended, modified, supplemented, renewed, restated or replaced, in whole or part, from time to time, being herein called the “Indenture”), pursuant to which the Company will issue notes in an aggregate principal sum of US$185,000,000 (One Hundred Eighty-Five Million United States Dollars]) (as amended, modified, supplemented, renewed, restated or replaced, in whole or part, from time to time, the “Notes”).

D. The Mortgagor is a wholly-owned subsidiary of the Company. Accordingly, the Mortgagor and the Company share common interest as members of a group of companies that will derive substantial direct and indirect economic and other benefits from the issuance of the Notes under the Indenture.

E. The Mortgagor has agreed to execute and deliver to the Mortgagee on behalf of the holders of the Notes this Mortgage in order to secure the payment in full of the Notes and other Note Obligations (as such term is hereinafter defined), and the total amount of the Mortgage is as set forth in Section 7.08 hereof.

AGREEMENT

In consideration of the foregoing premises and of other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, and in order to secure the payment and performance of all Note Obligations (as such term is hereinafter defined), the Mortgagor has granted, conveyed, mortgaged, pledged, assigned,

transferred, set over and confirmed and by these presents does grant, convey, mortgage, pledge, assign, transfer, set over and confirm unto the Mortgagee, its successors and assigns, the whole of the Vessel, together with all of the boilers, engines, generators, air compressors, cranes, machinery, masts, spars, rigging, boats, anchors, cables, chains, tackle, tools, pumps and pumping equipment, apparel, furniture, fittings and equipment, spare parts, and all other appurtenances thereunto appertaining or belonging, whether now owned or hereafter acquired, whether on board or not, and all additions, improvements, renewals and replacements hereafter made in or to the Vessel, or any part thereof, or in or to said appurtenances, all of which property shall be deemed to be included in the term “Vessel” as used in this Mortgage, provided that, notwithstanding anything to the contrary herein, the term “Vessel” shall not include Excluded Accounts (as such term is hereinafter defined);

TO HAVE AND TO HOLD all and singular the above mortgaged and described property unto the Mortgagee, its successors and assigns forever upon the terms herein set forth;

PROVIDED, HOWEVER, and these presents are on the condition that, if the Mortgagor, its successors or assigns shall pay and perform each and every one of the Note Obligations in accordance with the terms of the Notes and any other document or instrument evidencing any Note Obligation, then these presents and the estate and rights hereunder shall cease, terminate and be void, otherwise to be and remain in full force and effect.

ARTICLE I
DEFINITIONS

Section 1.01 Certain Defined Terms.

As used in this Mortgage, the following terms have the meanings specified below:

“Affiliate” of any specified Person means:

(1) any other Person, directly or indirectly, controlling or controlled by; or

(2) under direct or indirect common control with such specified Person.

For the purposes of this definition, “control” when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.

“Collateral” means any other property or assets subject to Liens to secure any of the Note Obligations pursuant to the provisions of the Security Documents.

“Company” has the meaning assigned to such term in Recital C.

“dollars” or “$” refers to lawful money of the United States of America.

“Excluded Accounts” means any right to payment of a monetary obligation in respect of the Vessel, whether or not earned by performance, (a) for services to rendered or to be rendered; or (b) for the use or hire of the Vessel under a charter or other contract the duration of which does not exceed one calendar year (such charters or other contracts herein referred to collectively as “Short-Term Charters”). For the avoidance of doubt, the following shall not be treated as “Excluded Accounts”: rights to payment of a monetary obligation in respect of the Vessel, whether or not earned by performance, (i) for the sale, lease, license, assignment or other disposition of the Vessel, other than Short-Term Charters; (ii) for the use or hire of the Vessel, other than Short-Term Charters; or (iii) for a policy of insurance issued or to be issued relating to the Vessel.

“Indenture” has the meaning assigned to such term in Recital C.

“Lien” means any mortgage, pledge, security interest, encumbrance, lien or charge of any kind (including any conditional sale or other title retention agreement or lease in the nature thereof, a ship or vessel mortgage or encumbrance, any option or other agreement to sell or give a security interest in any property).

“Mortgage” has the meaning assigned to such term in the initial paragraph hereof.

“Mortgage Default” has the meaning assigned to such term in Section 3.01 hereof.

“Mortgagee” has the meaning assigned to such term in the initial paragraph hereof.

“Mortgage Event of Default” has the meaning assigned to such term in Section 3.01 hereof.

“Mortgagor” has the meaning assigned to such term in the initial paragraph hereof.

“Note Documents” means, collectively, the Notes, the Indenture, and the Security Documents.

“Note Obligations” means (a) all principal, interest, premium, fees, reimbursements, indemnifications, and other amounts now or hereafter owed by any Obligor under the Note Documents; (b) all amounts now or hereafter owed by the Mortgagor under this Mortgage and the other Security Documents; and (c) any increases, extensions, renewals, replacements, and rearrangements of the foregoing obligations under any amendments, supplements, and other modifications of the agreements creating the foregoing obligations, in each case, whether direct or indirect, absolute or contingent.

“Notes” has the meaning assigned to such term in Recital C.

“Obligor” means each of the Company, the Mortgagor, any Person that now is or hereafter becomes a guarantor of the Notes, and any other Person that has granted a Lien upon any of such Person’s property as security for the Note Obligations.

“Permitted Collateral Liens” means Liens that, under the provisions of the Indenture, are permitted to exist with respect to the Vessel.

“Permitted Flag Jurisdiction” means the United Kingdom, the Isle of Man, the Commonwealth of Bermuda, the British Virgin Islands, the Cayman Islands, the United States of America, any State of the United States or the District of Columbia, the Commonwealth of the Bahamas, the Republic of the ▇▇▇▇▇▇▇▇ Islands, the Republic of Liberia, the Republic of Panama, Singapore, Cyprus, the Philippines, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇, and any other jurisdiction generally acceptable to institutional lenders in the shipping industry, as determined in good faith by the Board of Directors of the Company or any committee thereof duly authorized to act on behalf of such Board of Directors.

“Person” means any individual, corporation, partnership, limited liability company, joint venture, association, joint stock company, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity.

“Security Documents” means this Mortgage and any other security agreements, pledge agreements, collateral assignments, mortgages, vessel mortgages, marine mortgages, deeds of covenants, assignments of earnings and insurances, share pledges, collateral agency agreements, intercreditor agreements, deeds of trust or other grants or transfers for security executed and delivered by the Mortgagor, the Company and/or any other Obligor creating, or purporting to create, a Lien upon any Collateral in favor of the Trustee for the benefit of the holders of the Notes, in each case as amended, modified, supplemented, renewed, restated or replaced, in whole or part, from time to time.

“TIA” means the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb), as amended, as in effect on the date on which the Indenture is qualified under the TIA, except as otherwise provided in Section 9.03 of the Indenture.

“Trustee” has the meaning assigned to such term in the initial paragraph hereof.

“Vessel” has the meaning assigned to such term in Recital A.

Section 1.02 Terms Generally; Rules of Construction.

The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The word “will” shall be construed to have the same meaning and effect as the word “shall”. Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth in the Note Documents), (b) any reference herein to any law shall be construed as referring to such law as amended, modified, codified or reenacted, in whole or in part,

and in effect from time to time, (c) any reference herein to any Person shall be construed to include such Person’s successors and assigns (subject to the restrictions contained in the Note Documents), (d) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (e) with respect to the determination of any time period, the word “from” means “from and including” and the word “to” means “to and including” and (f) any reference herein to Sections, Annexes, Exhibits and Schedules shall be construed to refer to Sections of, and Annexes, Exhibits and Schedules to, this Mortgage. No provision of this Agreement or any other Note Document shall be interpreted or construed against any Person solely because such Person or its legal representative drafted such provision.

ARTICLE II
REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE MORTGAGOR

In order to induce the Mortgagee and the holders of the Notes to enter into the Indenture and to induce the holders of the Notes to purchase their Notes thereunder, the Mortgagor represents and warrants to the Mortgagee and the holders of the Notes and covenants with the Mortgagee and the holders of the Notes that:

Section 2.01 Payment and Performance of Note Obligations.

The Mortgagor will pay, observe, perform and comply with each and every one of the covenants, terms and conditions herein expressed or implied (including, without limitation, the Note Obligations), on its part to be paid, observed, performed, or complied with.

Section 2.02 Organization.

The Mortgagor is a corporation organized and existing under the laws of the Republic of Panama.

Section 2.03 Ownership of Vessel, Warranty and Defense of Title.

The Mortgagor lawfully owns and is lawfully possessed of the Vessel free from any Lien whatsoever other than the lien of this Mortgage and Permitted Collateral Liens and the Mortgagor will warrant and defend the title to, and possession of the Vessel and every part thereof for the benefit of the Mortgagee against the claims and demands of all Persons whomsoever.

Section 2.04 Compliance with Laws.

(a) Documentation. The Mortgagor will comply with and satisfy all provisions of the laws and regulations of the Republic of Panama now or hereafter from time to time in effect in order that the Vessel shall continue to be a documented vessel

pursuant to the laws of the Republic of Panama as a vessel of the Republic of Panama under the flag of the Republic of Panama with such endorsements as shall qualify the Vessel for participation in the coastwise trade and such other trades and services to which they may be dedicated from time to time.

(b) First Preferred Ship Mortgage. The Mortgagor will, at its sole expense and at no cost to the Mortgagee, comply with and satisfy all the provisions of the laws and regulations of the Republic of Panama, in order to establish, record and maintain this Mortgage as a First Preferred Ship Mortgage thereunder upon the Vessel, and will do all such other acts and execute all such instruments, deeds, conveyances, mortgages and assurances as the Mortgagee shall reasonably require in order to subject the Vessel to the lien of this Mortgage as aforesaid.

(c) Laws, Treaties and Conventions. The Vessel shall, and the Mortgagor covenants that they will, at all times comply with all applicable laws, treaties and conventions and rules and regulations issued thereunder, and shall have on board as and when required thereby valid certificates showing compliance therewith.

Section 2.05 Operation of Vessel.

The Mortgagor will not cause or permit the Vessel to be operated in any manner contrary to applicable law or regulation, or in any manner not permitted by the Indenture or by any insurances required thereby and hereby, will not engage in any unlawful trade, violate any law or carry any cargo that will expose the Vessel to penalty, forfeiture or capture and will not do, or suffer or permit to be done, anything which can or may injuriously affect the documentation of the Vessel under the laws and regulations of the Republic of Panama. Mortgagor shall keep the operation of the Vessel within the permitted navigational limits set forth in the trading warranties of the policies of insurance covering the Vessel and in any case will not operate the Vessel, or permit the Vessel to be operated, in any area where such insurance would not be fully applicable and enforceable with respect to the Vessel and its operation.

Section 2.06 Claims, Taxes, Fees, Etc.

The Mortgagor will pay and discharge or cause to be paid and discharged when due and payable from time to time, all claims against, and fees, taxes, assessments, governmental charges, fines and penalties (collectively “claims”) imposed on the Vessel, its cargo or any income therefrom; provided, however, that Mortgagor shall have the right to contest any such claims by appropriate proceedings timely commenced and diligently prosecuted; provided, further, that Mortgagor first provides adequate replacement security to cause the release of the Vessel and provided that such contest otherwise poses no risk to the Collateral or Mortgagee’s position in it.

Section 2.07 Liens.

Neither the Mortgagor, any shipper or charterer, the master of the Vessel nor any other Person who has or shall have any right, power or authority to create, incur or permit to be placed or imposed or continued upon the Vessel, its freights, profits or hires, any lien,

security interest, encumbrance or charge whatsoever other than Permitted Collateral Liens. Mortgagor agrees to hold a certified copy of this Mortgage in safekeeping and with the Vessel’s papers on board the Vessel, if the Vessel is self-propelled, and in the principal office of Mortgagor if the Vessel is not self propelled, on demand to exhibit the same to any person having business with the Vessel, or to any representative of Mortgagee. Mortgagor shall also place and cause to be displayed in a prominent place and in a durable manner a notice printed in plain type of such size that the paragraph of reading matter shall cover a space not less than six inches wide by nine inches high, reading as follows:

“NOTICE OF FIRST PREFERRED SHIP MORTGAGE AND OWNERSHIP”

“This Vessel is owned by [Mortgagor] and is covered by a first preferred ship mortgage in favor of Wilmington Trust Company, as Trustee and Mortgagee on behalf of the holders of the Notes. Under the terms of said first preferred ship mortgage, neither Owner, any charterer nor any subcharterer nor the master of this Vessel nor any other person has the right, power or authority to create, incur or permit to be placed or imposed upon this Vessel, or upon title thereto or any interest therein any lien whatsoever other than liens for current wages of the crew (including the master) of this Vessel, or for general average or salvage.”

Such notice shall be amended at the sole cost and expense of Mortgagor, upon request of Mortgagee, to reflect the identity of any successor Mortgagee.

Section 2.08 Notice of Mortgage.

The Mortgagor shall exhibit and shall require that any other person having custody or control of the Vessel exhibit a copy of this Mortgage to any person having business with the Vessel which might give rise to a maritime lien upon the Vessel or otherwise be deemed a sale, conveyance, mortgage or lease thereof and, on demand, to any representative of the Mortgagee.

Section 2.09 Removal of Liens.

The Mortgagor will not suffer to be continued any lien (other than Permitted Collateral Liens), encumbrance or charge on the Vessel other than this Mortgage, and in due course and in any event within thirty (30) days after the same shall become due and payable, will pay or cause to be discharged or make adequate provisions for the satisfaction or discharge of all claims or demands secured by any lien, charge or encumbrance on the Vessel and will cause the Vessel to be released or discharged from any such lien, encumbrance or charge thereon, without prejudice to Mortgagor’s right to contest any claims under Section 2.06 hereof following the release or discharge of such lien.

Section 2.10 Libel or Attachment.

If a libel is filed against the Vessel or if it shall be arrested, attached, levied upon or taken into custody by virtue of any proceeding in any court or tribunal or by any government or other authority, the Mortgagor shall promptly notify the Mortgagee

thereof by fax, confirmed by overnight letter addressed to the Mortgagee, and within three (3) days after any such libel, levy, attachment or taking into custody will cause the Vessel to be released and will promptly notify the Mortgagee of such release in the manner aforesaid.

Section 2.11 Maintenance of Vessel.

The Mortgagor will at all times and without cost or expense to the Mortgagee cause to be maintained and preserved the Vessel in good running order and repair, so that the Vessel shall be tight, staunch, strong and well and sufficiently tackled, appareled, furnished, equipped and in every respect seaworthy and in good order and operating condition, ordinary wear and tear excepted. The Mortgagor shall cause the Vessel to be drydocked, cleaned and painted whenever required by good commercial marine maintenance practice and the requirements of any insurance policy or entries respecting the Vessel. All maintenance and repairs will be made in a good and workmanlike manner by persons of appropriate skill and experience whose work will not adversely affect the service life or marketability of the Vessel. All repairs, parts, mechanisms, devices, replacements, improvements, changes, additions and alterations to the Vessel shall immediately and without further act, become part of the Vessel and subject to this Mortgage. Mortgagor shall promptly furnish to the Mortgagee copies of each damage survey with respect to damage to the Vessel where the survey does not specifically quantify the cost of total damages or where the survey states total damage in excess of $100,000.00.

Section 2.12 Changes in Vessel.

The Mortgagor will not make, or permit to be made, any change in the structure or type of the Vessel or in its rig that could reasonably be expected to materially diminish the market value of the Vessel or that could materially and adversely affect the rights of the Mortgagee under this Mortgage.

Section 2.13 Inspection.

The Mortgagor at all times shall afford the Mortgagee or its authorized representatives full and complete access to the Vessel for the purpose of inspecting or surveying the same and its papers and, at the request of the Mortgagee, the Mortgagor shall deliver for inspection copies of any and all contracts and documents relating to the Vessel, whether on board or not and shall cause any charterer to comply herewith during the term of any charter to the maximum extent permitted thereunder; provided that, absent the continuation of a Mortgage Event of Default, Mortgagee shall organize such inspections so as not to interfere with the Vessel’s normal operations.

Section 2.14 Change of Flag or Documentation.

So long as no Mortgage Default then exists or is continuing, the Mortgagor may change the flag or documentation of the Vessel in accordance with the procedures set forth in this Section 2.14, provided that the Mortgagor may change the flag of or re-document the Vessel only in a Permitted Flag Jurisdiction. Not later than sixty (60) days before the

date of such proposed flag change or re-documentation, the Mortgagor shall provide written notice thereof to the Mortgagee. Such notice shall (i) describe the proposed flag change or re-documentation; and (ii) state that such flag change or re-documentation will not interfere with the Mortgagee’s ability to realize the value of the Vessel and will not impair the maintenance and operation of the Vessel. Contemporaneously with the delivery of such written notice, the Mortgagor shall deliver to the Mortgagee (a) an Officer’s Certificate stating that (i) such change of flag or re-documentation complies with the terms and conditions of the Indenture and this Mortgage, including, without limitation, the provisions of this Section 2.14; (ii) there is no Mortgage Default in existence or continuing on the date thereof; (iii) such change of flag or re-documentation will not result in a Mortgage Default or a Mortgage Event of Default; and (iv) all conditions precedent in the Indenture and this Mortgage relating to such change of flag or re-documentation have been complied with; (b) all documentation required by the TIA (including, without limitation, Section 314(d) of the TIA) prior to the proposed change of flag or re-documentation; (c) an Opinion of Counsel in the jurisdiction in which the Vessel is to be re-flagged or re-documented, which Opinion of Counsel shall be acceptable in form and substance to the Mortgagee and shall state, among other things, that upon the taking of steps therein described (including, without limitation, the filing of any ship mortgages, fleet mortgages or amendments thereto), the Mortgagee will have a valid Lien on the re-flagged or re-documented Vessel; and (d) all documentation (including, without limitation, any ship mortgages, fleet mortgages, or amendments thereto) necessary or reasonably requested by the Mortgagee to grant to the Mortgagee a perfected first priority Lien (subject only to Permitted Collateral Liens) on the re-flagged or re-documented Vessel. The Mortgagee and the Mortgagor shall then promptly take the actions described in the immediately preceding clauses (c) and (d).

Section 2.15 Charter of Vessel.

The Mortgagor will not charter the Vessel to, or permit the Vessel to serve under any contract of affreightment with, a person included within the definition of “designated foreign country” or a “national” of a “designated foreign country” in the “Foreign Assets Control Regulations” or “Cuban Assets Control Regulations” of the United States Treasury Department, 31 C.F.R. Chapter V, as amended, within the meaning of said regulations or of any regulation, interpretation or ruling issued thereunder.

Section 2.16 Requisition of Title or Use.

In the event that the title to or ownership of the Vessel, or the use of the Vessel (whether on a bareboat, time or voyage charter basis or any other basis), shall be requisitioned, purchased or taken by, or the Vessel shall be seized by or forfeited to, any government of any country or any department, agency or representative thereof, pursuant to any present or future law, proclamation, decree, order or otherwise, or by any other Person(s), whether or not acting under color of governmental authority, the compensation, purchase price, reimbursement or award for such requisition, purchase, seizure, forfeiture or other taking of such title, ownership or use shall forthwith be and become payable to the Mortgagee, who shall be entitled to receive the same and shall apply it as provided in the Indenture.

Section 2.17 Notice of Loss, Requisition or Damage.

In the event of (a) the disappearance or actual or constructive loss of the Vessel, (b) any event referred to in Section 2.16 hereof with respect to the Vessel, or (c) any casualty, accident or damage to the Vessel in excess of $100,000.00, the Mortgagor will give written notice thereof (containing full particulars), within three business days of the occurrence thereof, to the Mortgagee.

Section 2.18 Insurance.

(a) Form and Amount.

(i) Hull & Machinery Insurance. At its own expense, Mortgagor will maintain or cause to be maintained with financially sound and reputable insurers (all risk equivalent) marine hull and machinery insurance (and, if necessary to satisfy the proviso of this subparagraph, policies of increased value insurance) and war risk hull & machinery insurance covering confiscation, appropriation, nationalization and seizure for vessels operating outside the United States coastal waters on an agreed value basis on the Vessel against loss, damage, fire and hurricane loss or damage and such other perils and in such amounts as are usually maintained on vessels engaged in the same or a similar business under blanket fleet policies with respect to vessels of like size, character and marine activity; provided, however, that in no event shall the amount of such insurance at any time be less than full replacement value.

Such insurance shall be effective on the date hereof and shall name the Mortgagor, Mortgagee and other interested persons as insureds as their respective interests may appear, but (subject only to Section 2.18(b) hereof) shall be payable solely to Mortgagee for further disbursement by it to the other insureds as their interests may appear and shall be applied as set forth in Section 2.18(b).

With respect to policies required under this Section 2.18(a)(i), the deductible for such policies shall not exceed $100,000.00 per incident.

(ii) Liability Insurance. At its own expense, Mortgagor shall maintain entries with financially sound and reputable insurers or protection and indemnity associations acceptable to Mortgagee, protecting the interests of Mortgagor and Mortgagee against liability for property damage to third persons and personal injury or death to any person arising out of the maintenance, use, operation and ownership of the Vessel, protection and indemnity, collision, tower’s liability including crew, cargo, contractual liabilities, pollution, and removal of wreck insurance (including liability to any governmental authority or other person with respect to pollution liability), as well as war risks liability for vessels operating outside the coastal waters of the United States, in such amounts as are usually carried by persons engaged in the same or similar businesses; provided, however, that in no event shall the amount of such insurance per person and per occurrence

(subject to a usual and customary deductible) be less than the customary amount of coverage available on the market from time to time with respect to vessels of the same type, age and trade as the Vessel. Such liability insurance shall name each of the Mortgagee, and other interested persons as additional insureds, as their respective interests may appear, but the proceeds of such policies shall be payable to the Person actually suffering the loss in respect of which such proceeds are payable. Combined single limits for bodily injury and property damage shall be in an amount no less than the amount customarily maintained by prudent companies engaged in the same or similar businesses operating in the same or similar locations.

(b) Application of Proceeds. All policies of insurance required under this Section 2.18 shall be placed through first-class marine brokers and shall name the Mortgagor and Mortgagee, as named insured. Policies maintained under Section 2.18(a)(a)(i) above shall name the Mortgagee as a loss payee and shall provide that all payments in respect of loss or damage shall be made solely to the Mortgagee for all amounts in excess of $100,000.00 and that upon the occurrence and continuance of a Mortgage Event of Default hereunder, all proceeds shall be payable solely to Mortgagee for the benefit of the Mortgagee. Any insurance recoveries under any policies to which the Mortgagee shall be so entitled shall be applied as provided in Section 4.10 of the Indenture.

(c) Constructive Total Loss. In the event of an accident, occurrence or event resulting in a constructive total loss of the Vessel, the Mortgagee shall claim for a constructive total loss of the Vessel and require that Mortgagor declare such to be a constructive total loss, and if both (i) such claim is accepted by all underwriters under all policies then in force as to the Vessel under which payment is due for total loss and (ii) payment in full is made in cash under such policies, then, with the underwriters’ approval, the Mortgagee shall abandon the Vessel to the underwriters under such policies, free from the lien of this Mortgage.

(d) Carriers; Approvals. All insurance required under this Section 2.18 shall be placed and kept with the United States Government or with reputable American, British, or other insurance companies, underwriters’ associations, clubs or underwriting funds.

(e) Taking, Requisition, etc. During the continuance of a taking, requisition or charter of the use of the Vessel by the United States Government, the provisions of this Section shall be deemed to have been complied with in all respects as to the Vessel if the United States Government shall have agreed, pursuant to an agreement in form and substance satisfactory to the Mortgagee, to reimburse the Mortgagee and the Mortgagor for loss or damage resulting from the risks indicated in Section 2.18(a). In the event of any taking, requisition, charter or loss of the Vessel contemplated by this paragraph the Mortgagor shall promptly furnish to the Mortgagee an officer’s certificate stating that such taking, requisition, charter or loss has occurred and, if such is the case, that the United States Government has agreed to reimburse the

Mortgagee and the Mortgagor for loss or damage resulting from the risks covered pursuant to the requirements of Section 2.18(a).

(f) Additional Provisions.

(i) All insurance required under this Section 2.18 shall, unless otherwise first agreed in writing by the Mortgagee, provide that (A) there shall be no recourse against the Mortgagee for the payment of premiums, supplemental or back calls or commissions, warranties or representations to underwriters, (B) if such insurance provides for the payment of club calls, assessments or advances, there shall be no recourse against the Mortgagee for the payment thereof, (C) the policies shall provide for severability of interest as though separate policies were issued to each additional insured, except with respect to the limits of liabilities, (D) at least thirty (30) days’ prior written notice of any cancellation, reduction in amount or change in coverage or other material change of such insurance (seven (7) days prior written notice in the case of war risk insurance) shall be given to the Mortgagee by the insurance underwriters, (E) no insurance shall be invalidated by any assignment of any charters of the Vessel, (F) no insurance required by this Section 2.18 shall be invalidated by reason of any breach of representation or warranty by Mortgagor and each policy or entry shall have a specific endorsement to the effect that no violation of the terms, conditions or warranties of the insurance by the Mortgagor or any of its Affiliates will invalidate the claim of Mortgagee to coverage under such entries or policies of insurance, and (G) the insurers agree to advise Mortgagee promptly in writing of any default in the payment of any premium and of any other act or omission of which such insurer has knowledge which might invalidate or render unenforceable, in whole or in part, any such policy.

(ii) The Mortgagor shall not do any act, nor voluntarily suffer nor permit any act to be done, whereby any insurance required by this Section 2.18 shall or may be suspended, impaired or defeated, or suffer or permit the Vessel to engage in any voyage or any activity not permitted under policies of insurance satisfactory to the Mortgagee in all respects for such voyage or the engaging in of such activity. Mortgagee may maintain its own policies of insurance on and with respect to the Vessel and none of such policies shall be contributory to satisfy the obligations of Mortgagor or the requirements of the insurances required by this Section 2.18.

(iii) The Mortgagor shall, on behalf and for the benefit of itself and the Mortgagee, (A) when required by law, maintain Certificates of Financial Responsibility (Oil Pollution) issued by the United States Coast Guard pursuant to the Federal Water Pollution Control Act, as amended inter alia by the Oil Pollution Act of 1990, and (B) maintain such additional coverage for the Vessel in respect of pollution liability as may be required by law now or hereafter in effect or customary among owners of similar vessels engaged in trade in the United States or in the Republic of Panama from time to time. Mortgagor shall provide,

for Mortgagee’s benefit, policies of insurance covering freight, demurrage and defense insurance to cover any legal defense costs.

Section 2.19 Reimbursement of Mortgagee.

In the event that Mortgagor shall fail to obtain or maintain insurance in accordance with the provisions of this Mortgage, Mortgagee shall have the right to obtain, and pay the premiums on, such insurance as the Mortgagee reasonably deems necessary. The Mortgagor shall reimburse the Mortgagee on demand, with interest (at the interest rate applicable to overdue principal under the provisions of the Notes) for any and all expenditures which the Mortgagee may from time to time make, lay out or expend in providing protection in respect of insurance, discharge or purchase of any liens, taxes, dues, assessments, governmental charges, fines and penalties imposed, repairs, attorneys’ fees and other matters as the Mortgagor is obligated herein to provide, but fails to provide. Such obligation of the Mortgagor to reimburse the Mortgagee, together with interest as provided above, shall be an additional indebtedness due from the Mortgagor, secured by this Mortgage, and shall be payable by the Mortgagor on demand. The Mortgagee, though privileged so to do, shall be under no obligation to the Mortgagor or to any other Person to make any such expenditures, nor shall the making thereof relieve the Mortgagor of any Mortgage Event of Default in that respect.

Section 2.20 Reports.

Mortgagor shall furnish to the Mortgagee annually and not less than 15 days prior to the renewal or replacement of each policy or entry thereafter, a report and an original signed certificate of insurance by a nationally recognized first-class marine insurance broker acceptable to the Mortgagee, describing in reasonable detail the insurance then carried and maintained on and with respect to the Vessel and certifying that such insurance complies with the terms hereof and certifying that the insurances are in the form, cover the risks and are in the amounts determined in accordance with Section 2.18 of this Mortgage, and that, in the opinion of such firm, the insurance then carried and maintained complies with the terms of said Section 2.18. Mortgagor shall obtain for the benefit of the Mortgagee the undertaking of Mortgagor’s insurance agent or broker to promptly advise the Mortgagee in writing of any act or omission of which such agent or broker has knowledge which might invalidate or render unenforceable, in whole or in part, any such policy. The broker shall provide premium information to the Mortgagee specifying an estimate of the total annual premium by line and an estimated supplementary calls and assessments required by the P&I Club.

ARTICLE III
MORTGAGE DEFAULTS AND MORTAGE EVENTS OF DEFAULT

Section 3.01 Mortgage Defaults and Mortgage Events of Default.

For the purposes hereof, (a) the occurrence and continuance of a Default under the Indenture shall be a “Mortgage Default” hereunder, and (b) the occurrence and

continuance of an Event of Default under the Indenture shall be a “Mortgage Event of Default” hereunder.

ARTICLE IV
REMEDIES; APPLICATION OF PROCEEDS

Section 4.01 Sale, etc.

During the continuance of any Mortgage Event of Default, the Mortgagee shall have the right to pursue and enforce any of its rights and remedies under the Indenture and any other Note Document and, in addition, Mortgagee may do any one or more of the following as it may elect:

(a) Exercise all the rights and remedies in foreclosure and otherwise given to mortgagees by the provisions the laws of the Republic of Panama or other applicable law including the laws of any other applicable jurisdiction;

(b) Bring suit at law, in equity or in admiralty or initiate and prosecute such other judicial, extra-judicial, or administrative proceedings as it may consider appropriate to recover any and all sums due, or declared due, on the Notes, and all other obligations due, with the right to enforce payment of said sums against any assets of the Mortgagor, whether they are covered by this Mortgage or otherwise;

(c) Take possession of the Vessel with or without legal proceedings, at any place where it may be found; and the Mortgagor or any person in possession of the Vessel, forthwith upon request by the Mortgagee, as mortgage creditor, shall deliver possession to the Mortgagee, and the Mortgagee shall have the right, without being responsible for loss or damage, to lay up, hold, charter, lease, operate or otherwise use the Vessel for such period and under such conditions as it may deem most expedient for its interest, and demand, collect and retain all hire, freights, earnings, issues, revenues, income, profits, returns, premiums, salvage awards or recoveries, recoveries in general average, and all other sums due or to become due in respect of the Vessel or in respect of any insurance thereon from any Person whomsoever, accounting only for net profits, if any, arising from such use and charging against all receipts from such use or from the sale of the Vessel by court proceedings or pursuant to subsection (d) of this Section 4.01 below, all costs, expenses (including without limitation attorneys’ fees and disbursements), charges, damages or losses by reason of such use; and if at any time the Mortgagee shall avail itself of the right herein given to it to take the Vessel and shall take them, the Mortgagee shall have the right to dock the Vessel at any dock, pier or other premises owned or leased by the Mortgagor without charge, or at any other place at the cost and expense of the Mortgagor;

(d) Take and enter into possession of the Vessel, at any time, wherever the same may be, without legal process, and if it seems desirable to the Mortgagee without being responsible for loss or damage, sell it at any place or places and at such time or times as the Mortgagee may specify, at public or private sale, by sealed bids or otherwise, on such terms and conditions as the Mortgagee deems best, free of any claim,

commitment or encumbrance, regardless of the nature thereof, in favor of the Mortgagor and, except as provided by law, in favor of any other person, upon advance notice of ten (10) consecutive days published in any newspaper authorized to publish such legal notices in the hailing port and the places of sale of the Vessel and by sending by mail notice of such sale to the Mortgagor and any other recorded Mortgagee of the Vessel at least twenty (20) days prior to the date fixed for such sale. In the event that the Vessel shall be offered for sale by private sale, no newspaper publication of notice shall be required, nor notice of adjournment of sale. Sale may be held at such place and at such time as the Mortgagee by notice may have specified, or may be adjourned by the Mortgagee from time to time by announcement at the time and place appointed for such sale or for such adjourned sale, and, without further notice or publication the Mortgagee may make any such sale at the time and place to which the same shall be so adjourned; and any sale may be conducted without bringing the Vessel to the place designated for such sale and in such manner as the Mortgagee may deem to be for its best advantage, and the Mortgagee may become the purchaser at any public sale, and shall have the right to credit on the purchase price any and all sums of money due to the Mortgagee hereunder or to the Mortgagee under the Indenture, any other Note Document or under any other instrument evidencing any Note Obligation.

Section 4.02 Finality of Sale.

A sale of the Vessel made in pursuance of this Mortgage, whether under the power of sale hereby granted or any judicial proceedings, shall operate to divest all right, title and interest of any nature whatsoever of the Mortgagor therein and thereto, and shall bar the Mortgagor, its successors and assigns, and all persons claiming by, through or under them. No purchaser shall be bound to inquire whether notice has been given or whether any Mortgage Event of Default has occurred, or as to the propriety of the sale, or as to application of the proceeds thereof. In case of any such sale, any purchaser who is the holder of this Mortgage shall be entitled, for the purpose of making settlement or payment for the Vessel, to apply the balance due under this Mortgage or a part thereof as part or all of the purchase price to the extent of the amount remaining due and unpaid. At any such sale, the holder of this Mortgage may bid for and purchase the Vessel and upon compliance with the terms of sale may hold, retain and dispose of the Vessel without further accountability. At any such sale, the Mortgagee may bid for the purchase of the Vessel and upon compliance with the terms of sale may hold and retain and dispose of the Vessel without further accountability therefor.

Section 4.03 Powers and Rights of Mortgagee upon Occurrence of a Mortgage Event of Default.

(a) Sale. For the purpose of Section 4.01 and Section 4.02, the Mortgagor does hereby irrevocably appoint the Mortgagee and its successors and assigns the true and lawful attorneys-in-fact of the Mortgagor, in its name and stead, to make all necessary transfers of the Vessel, and for that purpose the Mortgagee may execute all necessary instruments of assignment and transfer (including bills of sale), the Mortgagor

hereby ratifying and confirming all that its said attorney shall lawfully do by virtue hereof. Nevertheless, the Mortgagor, if so requested by the Mortgagee, shall ratify and confirm any sale of the Vessel by executing and delivering to the purchaser thereof such proper bills of sale, conveyances, instruments of transfer and releases as may be designated in such request.

(b) Revenues and Proceeds of the Vessel. The Mortgagee is hereby irrevocably appointed attorney-in-fact of the Mortgagor, upon the happening and during the continuation of any Mortgage Event of Default in the name of the Mortgagor to demand, collect, receive, compromise and ▇▇▇ for, so far as may be permitted by law, all freights, hire, earnings, issues, revenues, income and profits of the Vessel, and all amounts due from underwriters under any insurance thereon as payment of losses or as return premiums or otherwise, salvage awards and recoveries, recoveries in general average or otherwise, and all other sums due or to become due in respect of the Vessel or in respect of any insurance thereon from any person whomsoever, and to make, give and execute in the name of the Mortgagor acquittances, receipts, releases or other discharges for the same, whether under seal or otherwise, and to endorse and accept in the name of the Mortgagor all checks, notes, drafts, warrants, agreements and all other instruments in writing with respect to the foregoing, the Mortgagor hereby confirming and ratifying the same.

(c) Additional Rights. The Mortgagor covenants and agrees that in addition to any and all other rights, powers and remedies elsewhere in this Mortgage granted to and conferred upon the Mortgagee, and including, without limitation, in any suit to enforce any of its rights, powers or remedies, if a Mortgage Event of Default shall have occurred and be continuing and shall not have been waived by the Mortgagee, the Mortgagee shall be entitled as a matter of right and not as a matter of discretion (i) to the appointment of a receiver or receivers of the Vessel and collection of the freights, hire, earnings, issues, revenues, income and profits due or to become due arising from any operation of the Vessel, and any receiver or receivers so appointed shall have full right and power to use and operate the Vessel, and (ii) to a decree ordering and directing the sale and disposal of the Vessel, and the Mortgagee may become the purchaser at such sale and shall have the right to credit on the purchase price any and all sums of money due hereunder or to the Mortgagee under the Indenture, any other Note Document or under any other instrument evidencing any Note Obligation. The Mortgagee shall not be required to have the Vessel marshaled (upon any sale of the Vessel pursuant to this Mortgage or otherwise) or be required to realize on any other Collateral prior to realization on the Vessel.

(d) Restoration of Position. In case the Mortgagee shall have proceeded to enforce any right, power or remedy under this Mortgage by foreclosure, entry or otherwise, and such proceedings shall have been discontinued or abandoned for any reason or shall have been determined adversely to the Mortgagee, then and in every such case the Mortgagor and the Mortgagee shall be restored to their former positions and rights hereunder with respect to the property subject or intended to be subject to the Mortgage, and all rights, remedies and powers of the Mortgagee shall continue as if no such proceedings had been taken.

Section 4.04 Application of Proceeds.

The proceeds of any sale and net earnings derived from the operation, use, charter, or any other employment of the Vessel by the Mortgagee, as mortgage creditor, and within any of the powers and authority above given, as well as the proceeds of any judgment which the Mortgagee may obtain by reason of the breach or failure to perform any of the terms of this Mortgage, as well as the proceeds of any claim for damage received by the Mortgagee while exercising the powers and the authorities above given, shall be applied by the Mortgagee as provided in the Indenture.

In the event the proceeds and the net earnings referred to in this Section 4.04 should be insufficient to pay the sum total of the Note Obligations under the Note Documents, then the Mortgagee, as mortgage creditor, shall have the right to collect and to receive from the Mortgagor, or from any other person or persons who may be chargeable in respect thereof, such amount as will fully pay any remaining deficiency with respect to such obligations under this Mortgage and the other Note Documents. In any action to enforce the Mortgage whether in rem or in personam, in admiralty, in equity or at law, Mortgagor hereby waives any right to trial by jury.

ARTICLE V
GENERAL POWERS OF MORTGAGEE

(a) Arrest or Detention of Vessel. In the event that the Vessel shall be arrested or detained by a Marshal or other officer of any court of law, equity or admiralty jurisdiction in any country or nation of the world or by any government or other Person, the Mortgagor does hereby authorize and empower the Mortgagee, from the date of arrest or detention, in the name of the Mortgagor, or its successors or assigns, to apply for and receive possession of and to take possession of the Vessel with all the rights and powers that the Mortgagor, or its successors or assigns, might have, possess or exercise in any such event; and this power of attorney shall be irrevocable and may be exercised not only by the Mortgagee but also by its appointee or appointees, with full power of substitution, to the same extent as if the said appointee or appointees had been named as one of the attorneys above named by express designation.

(b) Suits. The Mortgagor also authorizes and empowers the Mortgagee or its appointees or any of them to appear in the name of the Mortgagor, its successors or assigns, in any court of any country or nation of the world where a suit is pending against the Vessel because of or on account of any alleged lien against the Vessel from which the Vessel has not been released and to take such proceedings as to them may seem proper towards the defense of such suit and the discharge of such lien, and all expenditures made or incurred by them or any of them for the purpose of such defense or discharge shall be a debt due from the Mortgagor, its successors and assigns, to the Mortgagee, and shall be secured by the lien of this Mortgage in like manner and extent as if the amount and description thereof were written herein.

ARTICLE VI
INDEMNITY

The Mortgagor assumes liability for, and agrees to indemnify and hold the Mortgagee harmless from, all claims, costs, expenses (including, without limitation, legal expenses), damages and liabilities arising from or pertaining to this Mortgage or the ownership, use, possession or operation of the Vessel by anyone other than the Mortgagee or a holder of the Notes; provided that Mortgagor shall have no obligation hereunder with respect to indemnified liabilities arising from the gross negligence or wilful misconduct of the Mortgagee. The agreements and indemnities contained in this Article shall survive the maturity or earlier discharge of this Mortgage and payment in full of the Notes and Note Obligations.

ARTICLE VII
SUNDRY PROVISIONS

Section 7.01 Cumulative Remedies; No Waiver.

Each and every power and remedy herein given to the Mortgagee shall be cumulative and shall be in addition to every other power and remedy herein or now or hereafter existing at law, in equity, in admiralty or by statute, and each and every power and remedy whether herein given or otherwise existing may be exercised from time to time and as often and in such order as may be deemed expedient by the Mortgagee, and the exercise or the beginning of the exercise of any power or remedy shall not be construed to be a waiver of the right to exercise at the same time or thereafter any other power or remedy. No delay or omission by the Mortgagee in the exercise of any right or power in the pursuance of any remedy specified in Article 4 accruing upon any Mortgage Event of Default hereof shall impair any such right, power or remedy or be construed to be a waiver of any such Mortgage Event of Default or an acquiescence therein; nor shall the acceptance by the Mortgagee of any security or of any payment of or on account of any part of the indebtedness secured by this Mortgage or of any payment on account of any past Mortgage Event of Default be construed to be a waiver of any right to take advantage of any future Mortgage Event of Default or of any past Mortgage Event of Default not completely cured thereby.

Section 7.02 Further Assurances.

In the event that this Mortgage, or any provisions hereof, shall be deemed invalid in whole or in part by reason of any present or future law or any decision of any court having jurisdiction, or if the documents at any time held by the Mortgagee shall be deemed by the Mortgagee for any reason insufficient to carry out the rights and powers granted to the Mortgagee herein, then, from time to time, the Mortgagor will do, execute, acknowledge and deliver, or cause to be done, executed, acknowledged and delivered such other and further assurances and documents as in the opinion of the Mortgagee may reasonably be required in order to more effectively subject the Vessel to the lien of this Mortgage or more effectively subject the Vessel to the performance of the terms and

provisions of this Mortgage, or to enable this Mortgage continuously to enjoy the status of a “preferred” mortgage.

Section 7.03 No Waiver of Preferred Status.

No provision of this Mortgage shall be deemed to constitute a waiver by the Mortgagee of the preferred status hereof given by Panamanian law, and any provision of this Mortgage which would otherwise constitute such a waiver shall to such extent be of no force or effect.

Section 7.04 Survival of Agreements.

All representations, warranties, covenants and agreements herein contained or made in writing in connection with this Mortgage shall survive the execution of this Mortgage and shall continue in full force and effect until all sums secured hereby shall have been paid in full, and the same shall bind and inure to the benefit of the respective successors and assigns of the Mortgagor and the Mortgagee.

Section 7.05 Notices.

All notices and other communications required or permitted to be given hereunder shall be given in the manner set forth in Section 12.02 of the Indenture.

Section 7.06 Counterparts; Amendments.

This instrument may be executed in any number of counterparts, and each of such counterparts shall for all purposes be deemed to be an original. No amendment, modification, or waiver of any provision of this Mortgage, and no consent with respect to any departure of the Mortgagor therefrom, shall be effective unless the same is in writing and conforms to the requirements set forth in Article IX of the Indenture.

Section 7.07 Nature of Agreements Hereunder.

The agreements, terms, conditions, rights, remedies and indemnities provided herein are in addition to, not in limitation of, and shall not be limited by, each of the agreements, terms, conditions, rights, remedies and indemnities contained in the Indenture.

Section 7.08 Recording.

For purposes of this Mortgage and for purposes of recording this Mortgage as required by Panamanian law, the total amount of this Mortgage is ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ DOLLARS ($185,000,000) plus interest, costs, expenses and performance of Mortgage covenants; the discharge amount is the same as the total amount and there is no separate discharge amount.

Section 7.09 Construction.

Any provision of this Mortgage which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof and any such prohibition or unenforceability shall not invalidate or render unenforceable such provision in any other jurisdiction. To the extent permitted by law, Mortgagor hereby waives any provision of law which renders any provision hereof prohibited or unenforceable in any respect.

Section 7.10 Governing Law.

This Mortgage shall be governed by the laws of the Republic of Panama.

Section 7.11 Power of Attorney for Registration.

The parties hereto hereby confer a special power of attorney with full right of substitution upon the law firm of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ of Panama City, the Republic of Panama, empowering them to take all necessary steps to record the Mortgage created hereby in the appropriate registries of the Republic of Panama.

[Signature Page Follows]

IN WITNESS WHEREOF, the Mortgagor has caused this Mortgage to be duly executed and delivered as of the day and year first above written.

	[MORTGAGOR]


	By:
	Name:
	Title:

SIGNATURE PAGE

FIRST PREFERRED SHIP MORTGAGE

NOTARIAL CERTIFICATE

I, the undersigned, NOTARY PUBLIC, duly authorized, admitted and sworn, residing and practicing in England, DO HEREBYCERTIFY that:

Mr. [insert name] as [insert title] of [Mortgagor] did sign and deliver the attached First Preferred Ship Mortgage hereunto annexed in my presence and the signature appearing at the foot of the said Mortgage, is his authentic signature, and sufficient proof has been produced to me that he has the right and power to execute the said Mortgage on behalf of [Mortgagor], as the Mortgagor.

IN TESTIMONY WHEREOF, I have hereunto subscribed my name and affixed my seal of office on this [ ] day of November,2006.

	(Signed)
		PUBLIC NOTARY

NOTARIAL CERTIFICATE

FIRST PREFERRED SHIP MORTGAGE

SCHEDULE I

Vessel

Name of Vessel		:

Permanent Patent Number		:

Call Sign		:

Registered Length		:

Registered Breadth		:

Registered Depth		:

Gross Tonnage		:

Net Tonnage		:

SCHEDULE II

Information for the Purposes of

Article 1515 of the Panamanian

Commercial Code

Owner/Mortgagor Name and Address:	[Mortgagor] c/▇ ▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇ctavo Piso Calle ▇▇▇▇▇▇▇ ▇. ▇▇ ▇▇▇▇▇ Guidad Pa▇▇▇▇ ▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇▇ ▇f Panama

Mortgagee Name and Address:	Wilmington Trust Company, as Trustee ▇▇▇▇▇▇ Square North 11▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇.▇.▇.

Mortgage Contract Date:	November 16, 2006

Name of Vessel:

Vessel Details:	Permanent Patent No.: Call Sign: Registered Length: Registered Breadth: Registered Depth: Gross Tonnage: Net Tonnage:

Mortgage Amount:	One Hundred Eighty-Five Million U.S. Dollars ($185,000,000)

Maturity Date:	December 1, 2011 (the “*Maturity Date*”)

Interests, if any:	11% per annum; fixed rate

Mode of Payment:

Principal: The principal is to be repaid on the Maturity Date.

Interest: Interest is payable semi-annually on December 1 and June 1 of each year.

FIRST PREFERRED SHIP MORTGAGE DATED AS OF

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