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Eagle Bulk Shipping Inc.

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Date:
2007
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328K
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#3181808

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Execution Version





U.S.$1,600,000,000

THIRD AMENDED AND RESTATED CREDIT AGREEMENT

 

 
dated as of October 19, 2007

for
 

 
EAGLE BULK SHIPPING INC.
 
arranged by

THE ROYAL BANK OF SCOTLAND plc
 

 
with
 

 
THE ROYAL BANK OF SCOTLAND plc

acting as Agent and Security Trustee
 
 
 
 
 
 
 
 
 
Watson, Farley & Williams (New York) LLP



CONTENTS
 
CLAUSE
PAGE
SECTION I
 
     
INTERPRETATION
 
     
1
DEFINITIONS AND INTERPRETATION
2
     
 
SECTION 2
 
     
 
THE FACILITY
 
     
2
THE FACILITY
22
     
3
PURPOSE
22
     
4
CONDITIONS OF EFFECTIVENESS AND UTILIZATION
24
     
SECTION 3
 
     
UTILIZATION
 
     
5
UTILIZATION
26
     
SECTION 4
 
     
REDUCTION, REPAYMENT, PREPAYMENT AND CANCELLATION
 
     
6
REDUCTION AND REPAYMENT
29
     
7
PREPAYMENT AND CANCELLATION
29
     
SECTION 5
 
     
COSTS OF UTILIZATION
 
     
8
INTEREST
33
     
9
INTEREST PERIODS
34
     
10
CHANGES TO THE CALCULATION OF INTEREST
35
     
11
FEES
36
     
SECTION 6
 
     
ADDITIONAL PAYMENT OBLIGATIONS
 
     
12
TAX GROSS UP AND INDEMNITIES
37
     
13
INCREASED COSTS
38
     
14
OTHER INDEMNITIES
39
 
 

 

 
     
15
MITIGATION BY THE LENDERS
41
     
16
COSTS AND EXPENSES
41
     
SECTION 7
 
     
GUARANTEE
 
     
17
GUARANTEE AND INDEMNITY
43
     
SECTION 8
 
     
REPRESENTATIONS, UNDERTAKINGS AND EVENTS OF DEFAULT
 
     
18
REPRESENTATIONS
47
     
19
INFORMATION UNDERTAKINGS
53
     
20
FINANCIAL COVENANTS
55
     
21
SECURITY COVER
55
     
22
GENERAL UNDERTAKINGS
57
     
23
INSURANCE
62
     
24
SHIP COVENANTS
67
     
25
APPLICATION OF EARNINGS; SWAP PAYMENTS
71
     
26
EVENTS OF DEFAULT
71
     
SECTION 9
 
     
CHANGES TO PARTIES
 
     
27
CHANGES TO THE LENDERS
76
     
28
CHANGES TO THE OBLIGORS
79
     
29
CHANGES TO SWAP BANKS
80
     
SECTION 10
 
     
THE FINANCE PARTIES
 
     
30
ROLE OF THE SERVICING BANKS, THE ARRANGER AND THE BOOKRUNNER
81
     
31
CONDUCT OF BUSINESS BY THE FINANCE PARTIES
87
     
32
SHARING AMONG THE FINANCE PARTIES
88
     
SECTION 11
 
     
ADMINISTRATION
 
     
33
PAYMENT MECHANICS
90
 
 


 
     
34
SET-OFF
91
     
35
NOTICES
92
     
36
CALCULATIONS AND CERTIFICATES
93
     
37
PARTIAL INVALIDITY
93
     
38
REMEDIES AND WAIVERS
94
     
39
AMENDMENTS AND WAIVERS
94
     
40
COUNTERPARTS
94
     
41
ENTIRE AGREEMENT
95
     
SECTION 12
 
     
GOVERNING LAW AND ENFORCEMENT
 
     
42
GOVERNING LAW
96
     
43
ENFORCEMENT
96
     

SCHEDULE 1
THE ORIGINAL OBLIGORS
98
     
SCHEDULE 2
CONDITIONS PRECEDENT
100
     
SCHEDULE 3
REQUESTS PART I UTILIZATION REQUEST
107
     
SCHEDULE 3
REQUESTS PART II SELECTION NOTICE
108
     
SCHEDULE 4
MANDATORY COST FORMULA
109
     
SCHEDULE 5
FORM OF TRANSFER CERTIFICATE
112
     
SCHEDULE 6
FORM OF ACCESSION LETTER
114
     
SCHEDULE 7
FORM OF RESIGNATION LETTER
116
     
SCHEDULE 8
FORM OF COMPLIANCE CERTIFICATE
117
     
SCHEDULE 9
FORM OF CONFIDENTIALITY UNDERTAKING
121
     
SCHEDULE 10
TIMETABLES
I26
     
SCHEDULE 11
FORM OF DESIGNATION NOTICE
127
     
SCHEDULE 12
DETAILS OF EXISTING SHIPS, NEWBUILDINGS AND APPROVED CHARTERS
128
     
SCHEDULE 13
FORM OF SWAP BANK ACCESSION LETTER
133
     
SCHEDULE 14
ERISA
134
     
SCHEDULE I5
ADVANCES OUTSTANDING UNDER ORIGINAL CREDIT AGREEMENT AS OF OCTOBER 19, 2007
135
     
SIGNATORIES
 
136
 
 


 
EXHIBITS
 
EXHIBIT A
-
FORM OF NOTE
EXHIBIT B
-
FORM OF ACCOUNT CHARGE
EXHIBIT C
-
FORM OF CASH POOLING DEED
EXHIBIT D
-
FORM OF SECURITY INTEREST DEED
EXHIBIT E
-
FORM OF MASTER AGREEMENT ASSIGNMENT
EXHIBIT F
-
FORM OF ASSIGNMENT OF SHIPBUILDING CONTRACT (IHI)
EXHIBIT G
-
FORM OF ASSIGNMENT OF SHIPBUILDING CONTRACT AND REFUND GUARANTEE
EXHIBIT H
-
FORM OF MORTGAGE
EXHIBIT I
-
FORM OF ASSIGNMENT OF EARNINGS
EXHIBIT J
-
FORM OF ASSIGNMENT OF INSURANCES
EXHIBIT K
-
FORM OF APPROVED MANAGER’S UNDERTAKING





THIS THIRD AMENDED AND RESTATED CREDIT AGREEMENT (this “Agreement”) is dated as of October 19, 2007 and made between:
 
(1)
EAGLE BULK SHIPPING INC., a corporation incorporated in the Republic of the Marshall Islands, as borrower (the “Borrower”);
 
(2)
THE SUBSIDIARIES of the Borrower listed in Part I of Schedule 1 as original guarantors (the “Original Guarantors”);
 
(3)
THE ROYAL BANK OF SCOTLAND plc as mandated lead arranger (the “Arranger”) and as bookrunner (the “Bookrunner”);
 
(4)
THE ROYAL BANK OF SCOTLAND plc as original lender (the “Original Lender”);
 
(5)
THE ROYAL BANK OF SCOTLAND plc as original swap bank (the “Original Swap Bank”);
 
(6)
THE ROYAL BANK OF SCOTLAND plc as agent of the other Finance Parties (the “Agent”); and
 
(7)
THE ROYAL BANK OF SCOTLAND plc as trustee for the other Finance Parties (the “Security Trustee”).
 
PRELIMINARY STATEMENTS:
 
(A)
The Borrower, the Existing Guarantors and the Original Lender are parties to a Second Amended and Restated Credit Agreement dated as of November 6, 2006 (the “Original Credit Agreement”) providing for a secured reducing revolving credit facility in the principal amount of $600,000,000 (the “Original Facility”) for the purposes described therein.
 
(B)
As of the date hereof $527,839,098.96 of the Original Facility has been borrowed by the Borrower and remains outstanding, and $72,160,901.04 remains available thereunder.
 
(C)
WHEREAS, the Borrower has requested that the Original Lender agree to amend and restate the Original Credit Agreement in its entirety in accordance with the terms and conditions set forth herein to, among other things, increase the amount of the Original Facility to a principal amount of $1,600,000,000 for the purposes set forth in Clause 3 (Purpose).
 
(D)
At the request of the Borrower and the Original Lender, the Agent and the Security Trustee have agreed to serve in their respective capacities under the terms of this Agreement and the Original Lender has agreed to provide to the Borrower a reducing revolving credit facility in the aggregate amount of up to $1,600,000,000 upon the terms and conditions set forth herein.
 
(E)
The Original Swap Bank has entered into certain hedging transactions with the Borrower and may enter into further hedging transactions with the Borrower from time to time to hedge the Borrower’s exposure to fluctuations in interest rates, foreign exchange rates, ocean freight rates and bunker fuel prices.
 
(F)
The Parties intend that (i) the provisions of the Original Credit Agreement and the documents executed as security for the Original Facility (the “Original Security Documents”), to the extent amended, restated, restructured, renewed, extended andmodified hereby, be superseded and replaced by the
 
 
1

 
 
 
provisions of this Agreement and the Finance Documents and the provisions thereof, (ii) this Agreement and the Finance Documents to be issued pursuant to this Agreement will not extinguish the obligations of the Borrower arising under the Original Credit Agreement, nor does this transaction constitute a novation of the Original Credit Agreement and Original Security Documents, (iii) all liens evidenced by the Original Credit Agreement and the Original Security Documents to the extent amended, restated, restructured, renewed, extended and modified hereunder, are hereby ratified, confirmed and continued, and (iv) this Agreement and the Finance Documents are intended to amend, restate, restructure, renew, extend and modify the Original Credit Agreement and the Original Security Documents.
 
 
(G)
The Original Lender has agreed with the Original Swap Bank that the Original Swap Bank will share in the security under the Finance Documents on a subordinated basis.
 
(H)
The Original Guarantors have agreed, in order to induce the Original Lender to agree to amend and restate the Original Credit Agreement and the Original Security Documents, to guarantee all of the obligations of the Borrower under this Agreement and the other Finance Documents, and the Master Agreements.
 
NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements contained herein, it is agreed as follows:
 

SECTION 1
 
INTERPRETATION
 
1
DEFINITIONS AND INTERPRETATION
 
1.1
Definitions
 
In this Agreement:
 
Accession Letter”  means a document in the form set out in Schedule 6 (Form of Accession Letter) or in any other form agreed between the Borrower and the Agent.
 
“Account Charge” means a deed containing, among other things, a first priority account charge made or to be made by a Guarantor in favor of the Security Trustee in respect of such Guarantor’s Operating Account and in substantially the form of Exhibit B or, in the case of an Existing Guarantor, an amendment and restatement in form and substance satisfactory to the Agent of the deed containing a first priority account charge made by such Existing Guarantor pursuant to the Original Credit Agreement.
 
Accounting Information” means the quarterly financial statements and/or the annual audited financial statements to be provided by the Borrower to the Lender in accordance with Clause 19.1 (Financial Statements).
 
Accounting Period” means each consecutive period of approximately three months (ending on the last day in March, June, September and December of each year) for which quarterly Accounting Information is required to be delivered in accordance with Clause 19.1 (Financial Statements).
 
Additional Cost Rate”  has the meaning given to it in Schedule 4 (Mandatory Cost formula).
 
2

 
Additional Guarantor”  means a Wholly-Owned Subsidiary of the Borrower which becomes an Additional Guarantor in accordance with Clause 28 Changes to the Obligors).
 
Additional Newbuilding”  means (i) any dry bulk carrier to be built (other than an IHI Newbuilding, a Target Newbuilding or a newbuilding for which an option is declared pursuant to the Option Agreement) which the Borrower notifies to the Agent pursuant to Clause 3.2(b) (Additional Ships and Additional Newbuildings) as a newbuilding for which the Borrower wishes to finance Newbuilding Predelivery Costs with the assistance of one or more Loans, and which the Agent shall notify to the Borrower as being acceptable to the Agent in accordance with Clause 3.2(b) (Additional Ships and Additional Newbuildings).
 
Additional Ship”  means (i) any dry bulk carrier (other than an Existing Ship) which the Borrower notifies to the Agent pursuant to Clause 3.2(a) (Additional Ships and Additional Newbuildings) as a ship which the Borrower wishes to finance or purchase with the assistance of a Loan, and which the Agent shall notify to the Borrower as being acceptable to the Agent in accordance with Clause 3.2(a) (Additional Ships and Additional Newbuildings), and (ii) any Newbuilding which has been or is to be delivered to a Guarantor.
 
Adjusted Net Worth” means, in respect of an Accounting Period, the amount of Total Assets less Consolidated Debt.
 
“Advance Ratio” has the meaning specified in Clause 8.4 (Advance Ratio)
 
Affiliate”  means, as to any person, any other person that, directly or indirectly, controls, is controlled by or is under common control with such person or is a director or officer of such person. For purposes of this definition, the term “control” (including the terms “controlling”, “controlled by” and “under common control with”) of a person means the possession, direct or indirect, of the power to vote 50% or more of the voting stock, membership or partnership interests, or other similar interests of such person or to direct or cause direction of the management and policies of such person, whether through the ownership of voting stock, membership or partnership interests, or other similar interests, by contract or otherwise.
 
“Agent” has the meaning specified in the recital hereof, and shall include any successor thereto.
 
Agreement” has the meaning specified in the recital hereto.
 
“Alternative Approved Flag” means, in relation to an Additional Ship, such flag (other than the flag of the Republic of The Marshall Islands) as the Agent may approve.
 
Approved Broker” means, as the context may require, any of H. Clarkson & Co. Ltd., Galbraiths Limited, Braemar Seascope or such other independent London based sale and purchase ship broker as may from time to time be appointed by the Agent.
 
Approved Charter” means, collectively, (i) the time charters described in Part IV of Schedule 12 (Details of Existing Ships, Newbuildings and Approved Charters), and (ii) any other time or consecutive voyage charter in respect of a Ship for a term which exceeds, or which by virtue of any optional extensions may exceed, 18 months and has been approved by the Agent.
 
3

 
Approved Manager”  means, as the context may require, (i) Eagle Shipping International (USA) LLC, a Marshall Islands limited liability company with offices currently at 477 Madison Avenue, New York, New York, or any other person approved by the Agent from time to time as the commercial manager of a Ship, which approval shall not unreasonably be withheld, and (ii) V Ships Management Ltd., an Isle of Man company with offices at Eaglehurst, Belmont Hill, Douglas, Isle of Man, Barber International Ltd., a Hong Kong company with offices at West Tower, Shun Tak Centre, 168-200 Connaught Road Central, Hong Kong, or, any other person approved by the Agent from time to time as the technical manager of a Ship, which approval shall not unreasonably be withheld.
 
“Approved Manager’s Undertakings” means each of the undertakings made or to be made by an Approved Manager in favor of the Security Trustee in respect of a Ship and in substantially the form of Exhibit K.
 
“Arranger” has the meaning specified in the recital hereof.
 
“Assignment of Earnings” means a first priority assignment of Earnings made or to be made by a Guarantor in favor of the Security Trustee in respect of a Ship and in substantially the form of Exhibit I or, in the case of an Existing Guarantor, an amendment and restatement in form and substance satisfactory to the Agent of the assignment of Earnings made by such Existing Guarantor pursuant to the Original Credit Agreement.

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