Contract

To:

DVB Bank SE, as Lender, Swap Bank, Arranger, Underwriter,

     Facility Agent, Security Agent and Documentation Agent

Platz der Republik 6

60325 Frankfurt am Main Germany

Attention: Loan Administration Manager

Fax No: +49 69 97 50 4444

 -and-

Attention: Camila Policarpio

c/o DVB Transport (US) LLC

609 Fifth Avenue, 5th Floor

New York, New York 10017

Facsimile: +212 858 2663

Email:  Camila.Policarpio@dvbbank.com

January 11, 2016

(a)

12:00 noon (New York Time) on March 31, 2016;

(b)

the failure after the date hereof of any of the Borrower or the Guarantors to comply with any of the terms or undertakings of this Letter Agreement, including without limitation the covenants set forth in Clauses 2 and 4 hereof;

(c)

the date of the occurrence of (i) any default or event of default under any Third Party Forbearance Agreement (as such term is defined below), or (ii) the termination, cancellation, revocation, repudiation, anticipatory repudiation or cessation, in whole or in part, of any Third Party Forbearance Agreement, unless, in the case of only Ultrapetrol or any subsidiary thereof (other than UP Offshore Bahamas or any person in which UP Offshore Bahamas has a direct, indirect or beneficial ownership interest), a proceeding as contemplated under the proviso in clause (d) of this definition of Forbearance Termination Date shall have commenced within two (2) Business Days following the date thereof and (x) such proceeding results in an automatic stay or equivalent and (y) no enforcement action has been taken within such two Business Days period as a consequence of such termination, cancellation, revocation, repudiation, anticipatory repudiation or cessation, in whole or in part, of such Third Party Forbearance Agreement;

(d)

the date any proceeding shall be instituted by or against any Obligor or Affiliate of any Obligor seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation, winding up, reorganization, arrangement, adjustment, protection, relief, or composition of it or its debts under any law relating to bankruptcy, insolvency or reorganization or relief of debtors or seeking the entry of an order for relief or the appointment of a receiver, trustee, custodian or other similar official for it or for any substantial part of its property, provided that the parties hereto agree that a Forbearance Termination Date will not be deemed to have occurred solely on the basis of such a proceeding being instituted by or against Ultrapetrol or any subsidiary thereof (other than UP Offshore Bahamas or any person in which UP Offshore Bahamas has a direct, indirect or beneficial ownership interest) and:

(i)

none of the Offshore Entities is named as a “debtor” in such proceeding;

(ii)

notwithstanding any provision contained herein to the contrary, the Credit Parties may:

(1)

file a proof of claim against Ultrapetrol in any such proceeding for the full amount of the obligations guaranteed by Ultrapetrol under the Loan Agreement (and for the purposes of such proof of claim, the Loan and all accrued interest and other amounts accrued or owing under the Loan Agreement shall be deemed immediately due and payable without notice or demand therefor), and none of Ultrapetrol or any other party named as a “debtor” in such proceeding will contest such proof of claim or the amount being claimed therein; and

(2)

exercise all rights, remedies and objections available to them as a “creditor” in such proceeding; and

(iii)

such proceeding, or any orders issued in relation to such proceeding, will not permit Petrobras to terminate, or result in Petrobras terminating, a Time Charter or a Service Contract for a Ship;

(e)

the date of the occurrence after the date hereof of any Event of Default under the Loan Agreement (other than any Event of Default waived or as otherwise provided for herein);

(f)

the date of the occurrence of any default or event of default under any other credit facility (including the Indenture) to which Ultrapetrol or UP Offshore Bahamas or an affiliate or subsidiary of them is a party, unless either (i) a Third Party Forbearance Agreement has been executed in respect of such credit facility under which a waiver or forbearance with respect to such default or event of default has been given by the relevant creditors thereunder and remains in effect, or (ii) a bankruptcy proceeding has been instituted by or against the relevant obligor prior to the occurrence of such default or event of default and such proceeding results in an automatic stay or equivalent; or

(g)

the 5th Business Day after Ultrapetrol and/or the Borrower gives notice to the Credit Parties of the exercise of remedies by any creditor under the Indenture, any credit facility with IFC, any credit facility with OFID or any other credit facility to which any subsidiary of Ultrapetrol (other than UP Offshore Bahamas or any person in which UP Offshore Bahamas has a direct, indirect or beneficial ownership interest) is a party, regardless of whether there is a Third Party Forbearance Agreement in effect with respect to such credit facility, provided that if Ultrapetrol and/or the Borrower shall not have given the Creditors Parties notice within two (2) Business Day of having obtained knowledge of any such exercise of remedies, the Forbearance Termination Date shall be the date any such notice should have been given.

(a)

forbearance, extension and/or waiver of:

(i)

any principal payments due under any such credit facility starting from the Forbearance Commencement Date (except with respect to mandatory prepayments of principal in connection with the sale or loss of a ship or vessel financed thereunder, and then only to the extent of any funds received with respect to such sale or loss (net of expenses));

(ii)

any payments under any such credit facility not otherwise permitted under the terms of this Letter Agreement; and

(iii)

existing and potential breaches of any financial or other covenants thereunder through March 31, 2016); and

(b)

an acknowledgment and agreement that funds used from any debt service reserve account will not be required to be replenished during the applicable forbearance period in such Third Party Forbearance Agreement,

1.

Extension of time for repayment instalments due under Clause 7.1 of the Loan Agreement during the Forbearance Period.

2.

Waiver of financial covenants under Clause 10.1(u) of the Loan Agreement.

3.

Waiver of anticipated Events of Default under Clause 14.1(a), Clause 14.1(b), Clause 14.l(c), Clause  14.1(f), Clause 14.1(g), Clause 14.1(j), Clause 14.1(q), Clause 14.1(r) and Clause 14.1(s) of the Loan Agreement.

4.

Covenants during the Forbearance Period.

(a)

Ultrapetrol shall cause all cash standing to the credit of or received in any account of any of the Offshore Entities and all incoming revenue in whatever form to remain in such account of such Offshore Entity in which it stands or is received and shall not permit such monies to be distributed, loaned or otherwise upstreamed or transferred by any Offshore Entity to any holding company at each of the Borrower, UP Offshore Bahamas and Ultrapetrol levels or to any Affiliate of any Guarantor or of the Borrower, provided that up to $5,000,000 may be transferred from only UP Offshore Bahamas or Ultrapetrol and applied solely toward payment of restructuring fees, expenses and severance costs as reasonably allocated to the business of the Offshore Entities as established to the reasonable satisfaction of the Credit Parties;

(b)

None of Ultrapetrol or any of its subsidiaries or affiliates shall make any payments of principal due under any other credit facility to which Ultrapetrol or UP Offshore Bahamas or an affiliate or subsidiary of them is a party or for which it is a guarantor, provided that Ultrapetrol and/or its subsidiaries or affiliates shall make the following payments as and when the same shall become due and payable:

(i)

mandatory prepayments of principal in connection with (x) the sale or loss of a ship or vessel financed thereunder, and then only to the extent of any funds received with respect to such sale or loss (net of expenses), (y) a payment of $1,800,000 from the debt service reserve account of Linford Trading Inc. (“Linford”) under the Loan Agreement dated as of December 20, 2013 (the “Linford Loan Agreement”) among, inter alios, Linford as borrower and DVB Bank America N.V. and NIBC Bank N.V. as creditor parties  (the “Linford Creditor Parties”), and (z) a payment of $2,500,000 from the debt service reserve account of Ingatestone Holdings Inc. (“Ingatestone”) under the Loan Agreement dated as of January 18, 2013 (the “Ingatestone Loan Agreement”) among, inter alios, Ingatestone as borrower, DVB Bank America N.V., NIBC Bank N.V. and ABN AMRO Capital USA LLC as creditor parties (the “Ingatestone Creditor Parties”); and

(ii)

any scheduled payments due (x) in February, 2016 under the Natixis credit facility, and (y) during the Forbearance Period under the BNDES Loan Agreement, in each of case (x) and (y) as provided in Schedule B hereto with respect to each such facility;

(c)

None of Ultrapetrol or any of its subsidiaries or affiliates (including without limitation any Offshore Entity) shall enter into any arrangements with any creditor pursuant to which it or they have granted or will grant any collateral, guarantees, preferential terms or treatment (or equivalent) additional to any such arrangements in place (including pursuant to any Third Party Forbearance Agreement) and disclosed to the Credit Parties prior to entering into this Letter Agreement. In addition, Ultrapetrol agrees that it shall disclose to the Credit Parties for information purposes only drafts of any Third Party Forbearance Agreement and the executed version of each such Third Party Forbearance Agreement;

(d)

Ultrapetrol shall provide to the Credit Parties unredacted copies of any restructuring plan (each, a “Plan”) presented by Ultrapetrol to the holders of the Bonds or any other lender to Ultrapetrol or any subsidiary thereof, and Ultrapetrol shall:

(i)

on a continuing basis, promptly upon receipt or issuance thereof, provide or procure the provision to the Credit Parties of copies of any revisions to any such Plan or any succeeding plan or proposals presented by Ultrapetrol to the holders of the Bonds or such other lenders;

(ii)

provide details as to any proposed participation of the Southern Cross Entities (as such term is defined in the Indenture) in such Plan or in any such succeeding plan or proposals presented by Ultrapetrol to the holders of the Bonds; and

(iii)

provide status reports to the Credit Parties on a bi-weekly basis and make its executive management and advisors available for in-person or telephonic meetings with the Credit Parties;

(e)

Each of the Borrower and the Guarantors shall provide evidence satisfactory to the Credit Parties relating to capital expenses as required by the Credit Parties during the Forbearance Period and shall where possible defer or cancel/postpone such payments and avoid the incurrence of any further obligations to make such payments, and generally use all commercial efforts to conserve and retain cash (it being understood and agreed that as to all of the foregoing to the extent consistent with safe and sound operation of the Ships in compliance with all applicable laws, regulations and insurance requirements);

(f)

It is understood and agreed that the Agent, for and on behalf of (i) itself and the Credit Parties, (ii) the Linford Creditor Parties, (iii) the Ingatestone Creditor Parties, (iv)  DYB Bank SE, DYB Bank America N.Y. and Banco Security as creditor parties (the “Jasper and Turquoise Creditor Parties”) in respect of the financing of the UP Jasper and UP Turquoise (the “Jasper and Turquoise Credit Facility”) and (v) DYB Bank SE and DYB Bank America N.Y. as creditor parties (the “Bilateral Creditor Parties”, and together with the Credit Parties, the Linford Creditor Parties, the Ingatestone Creditor Parties and the Jasper and Turquoise Creditor Parties, the “Offshore Creditor Parties”) in respect of various bilateral credit facilities (the “Bilateral Credit Facilities”) made available by them to certain of the Offshore Entities, shall hire a strategic advisor (the “Strategic Advisor”) to, inter alia:

(A)

review any Plan and any revisions or modifications thereto;

(B)

advise the Offshore Creditor Parties with respect to the Plan and any succeeding plan or proposals and in connection with any restructuring of the Loan Agreement, the Linford Loan Agreement, the Ingatestone Loan Agreement, the Jasper and Turquoise Credit Facility and the Bilateral Credit Facilities (collectively, the “Offshore Credit Facilities”); and

(C)

advise the Offshore Creditor Parties on their response to the Plan before the Offshore Creditor Parties enter into any agreement with regard to the Plan or a restructuring agreement with respect to any of the Offshore Credit Facilities.

In connection with the foregoing, Ultrapetrol shall (x) pay all fees, costs and expenses incurred by the Agent in connection with the services provided by such Strategic Advisor within 5 Business Days after receipt of any invoice of such Strategic Advisor and shall indemnify the Agent for all such invoices paid by the Agent that were not paid by Ultrapetrol within the aforesaid 5 Business Days, and (y) cause each of the “Security Parties” and/or “Obligors” under each of the Offshore Credit Facilities to cooperate fully with such Strategic Advisor.

5.

Borrower and Guarantor Representations and Warranties.

(a)

The execution and delivery by the Borrower, each Guarantor and UP Offshore Bahamas of this Letter Agreement and the performance by each such Obligor of all of its agreements and obligations under the Loan Agreement, as amended hereby, are within such Obligor’s corporate authority and have been duly authorized by all necessary corporate action on the part of such Obligor, and no consent of any third party is required in connection with the transactions contemplated by this Letter Agreement.

(b)

This Letter Agreement and the Loan Agreement, as amended hereby, constitute the legal, valid and binding obligations of each of the Obligors party hereto and are enforceable against such Obligors in accordance with their terms, except as enforceability is limited by bankruptcy, insolvency, reorganization, moratorium or other laws relating to or affecting generally the enforcement of, creditors’ rights and except to the extent that availability of the remedy of specific performance or injunctive relief is subject to the discretion of the court before which any proceeding may be brought.

(c)

The Borrower, each Guarantor and UP Offshore Bahamas certifies that:

(i)

there is no proceeding for the dissolution or liquidation of any Obligor;

(ii)

the representations and warranties contained in the Loan Agreement,  as amended hereby, are true and correct as though made on and as of the date hereof, except for (A) representations or warranties which expressly relate to an earlier date in which case such representations and warranties shall be true and correct, in all material respects, as of such earlier date or (B) representations or warranties which are no longer true as a result of a transaction expressly permitted by the Loan Agreement or as contemplated by this Letter Agreement;

(iii)

there is no material misstatement of fact in any information provided by any of the Obligors to the Credit Parties since September 30, 2015, and such information did not omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; and

(iv)

it has not entered into nor agreed to enter into any arrangements with any creditor pursuant to which they have or will be granted any collateral, guarantees, preferential terms or treatment (or equivalent) additional to that in place prior to entering into this Letter Agreement.

6.

Conditions precedent to the effectiveness of this Letter Agreement.

(a)

the relevant Ultrapetrol parties, as applicable, shall have entered into a Third Party Forbearance Agreement in respect of each other credit facility to which Ultrapetrol or UP Offshore Bahamas or an affiliate or subsidiary of them is a party (provided that if a Third Party Forbearance Agreement is not executed with respect to the Jasper and Turquoise Credit Facility, DVB Bank SE, as a lender under such facility, shall have executed an undertaking to abide by the terms of a draft of such Third Party Forbearance Agreement as if it had been executed by all creditor parties to such facility); and

(b)

the Borrower shall pay to the Credit Parties a fee of $15,000 in connection with this Letter Agreement, provided that the Credit Parties agree that upon payment such fee shall be deducted from any restructuring fee the Credit Parties request in connection with a restructuring of the obligations under the Loan Agreement.

7.

Reservation of rights.

8.

Guarantors’ confirmation.

9.

No other amendments or waivers.

10.

Finance Document.

11.

Governing law and jurisdiction.

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