Dated 2 FEBRUARY 2015 LOGITEL OFFSHORE RIG I PTE. LTD. (as Borrower) and CITIBANK N.A., LONDON BRANCH and others (as Facility Lenders) and CITIBANK INTERNATIONAL LIMITED (as Facility Agent) and CITIBANK N.A., LONDON BRANCH (as Facility Security...

Exhibit 2.1


Private & Confidential		Execution version
		EJXM/LN79718
		BD-#21955460-v11

Dated 2 FEBRUARY 2015

LOGITEL OFFSHORE RIG I PTE. LTD.

(as Borrower)

and

CITIBANK N.A., LONDON BRANCH

and others

(as Facility Lenders)

and

CITIBANK INTERNATIONAL LIMITED

(as Facility Agent)

and

CITIBANK N.A., LONDON BRANCH

(as Facility Security Trustee)

and

CITIBANK N.A., LONDON BRANCH

and others

(as Mandated Lead Arrangers)

and

CITIBANK N.A., LONDON BRANCH

(as sole Bookrunner)

and

CITIBANK N.A., LONDON BRANCH

(as GIEK Agent)

SECURED TERM LOAN FACILITY

of up to $150,000,000 in respect

of the floating accommodation unit with hull number N380

Contents


Clause		Page

1	Definitions and Interpretation		4

2	The Loan and its Purposes		5

3	Conditions of Utilisation		6

4	Advance		7

5	Repayment		8

6	Prepayment		9

7	Interest		11

8	Indemnities		13

9	Fees		17

10	Security and Application of Moneys		18

11	Representations and Warranties		19

12	Undertakings and Covenants		23

13	Events of Default		29

14	Assignment and Sub-Participation		34

15	The Facility Agent, the GIEK Agent, the Facility Security Trustee and the Facility Lenders		37

16	Set-Off		49

17	Payments		50

18	Notices		52

19	Partial Invalidity		54

20	Remedies and Waivers		54

21	Miscellaneous		54

22	Law and Jurisdiction		56

Schedule 1 Part 1: The Facility Lenders and the Commitments			57

Part 2: The MLAs			59

Schedule 2			60

Part 1: conditions precedent to the Advance			60



Part 2: Conditions subsequent					63

Schedule 3 Form of Drawdown Notice					64

Schedule 4 Form of Transfer Certificate					65

Schedule 5 Schedule of Repayment Amounts					67

Schedule 6 Definitions					68

Schedule 7 Vessel Total Costs					90

Schedule 8 Form of Accession Deed					91

Schedule 9 Additional Facility Principles					93

LOAN AGREEMENT (this Agreement) dated 2 FEBRUARY 2015

BETWEEN:

(1)	LOGITEL OFFSHORE RIG I PTE. LTD., a private limited company incorporated in Singapore whose registered office is at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ #▇▇-▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ (the Borrower);

(2)	The banks and financial institutions listed in Schedule 1, Part 1 as commercial facility lenders, each acting through its office at the address indicated against its name in Schedule 1, Part 1 (together the Commercial Facility Lenders and each a Commercial Facility Lender);

(3)	The banks and financial institutions listed in Schedule 1, Part 1 as GIEK facility lenders, each acting through its office at the address indicated against its name in Schedule 1, Part 1 (together the GIEK Facility Lenders and each a GIEK Facility Lender);

(4)	CITIBANK INTERNATIONAL LIMITED, acting as Facility Agent (in that capacity the Facility Agent);

(5)	The banks listed in Schedule 1, Part 2 acting as mandated lead arrangers (in that capacity the MLAs);

(6)	CITIBANK N.A., LONDON BRANCH, acting as Facility Security Trustee (in that capacity the Facility Security Trustee);

(7)	CITIBANK N.A., LONDON BRANCH, acting as sole bookrunner (in that capacity the Bookrunner); and

(8)	CITIBANK N.A., LONDON BRANCH, acting as GIEK Agent (in that capacity the GIEK Agent).

WHEREAS:

Each of the Facility Lenders has agreed to advance to the Borrower its Commitment (aggregating, with all the other Commitments, a term loan facility of up to one hundred and fifty million Dollars ($150,000,000)) for (i) in respect of the GIEK Facility Lenders, financing part of the Eligible Costs and (ii) in respect of the Commercial Facility Lenders, financing the remainder of the Vessel Total Costs.

IT IS AGREED as follows:

1	Definitions and Interpretation

1.1	In this Agreement unless the context otherwise requires, words and expressions defined in Schedule 6 have the same meanings in this Agreement.

1.2	In this Agreement:

1.2.1

words denoting the plural number include the singular and vice versa;

1.2.2

words denoting persons include corporations, partnerships, associations of persons (whether incorporated or not) or governmental or quasi-governmental bodies or authorities and vice versa;

1.2.3

references to Recitals, clauses and Schedules are references to recitals (being the paragraph under “Whereas”), clauses and schedules to or of this Agreement;

1.2.4

references to this Agreement include the Recitals and the Schedules;

1.2.5

the headings and contents page(s) are for the purpose of reference only, have no legal or other significance, and shall be ignored in the interpretation of this Agreement;

1.2.6

references to any document (including, without limitation, to all or any of the Transaction Documents) are, unless the context otherwise requires, references to that document as amended, supplemented, novated, entered into or replaced from time to time;

1.2.7

references to statutes or provisions of statutes are references to those statutes, or those provisions, as from time to time amended, replaced or re-enacted;

1.2.8

references to any Facility Beneficiary include its successors, transferees and assignees;

1.2.9

a time of day (unless otherwise specified) is a reference to London time;

1.2.10

references to a regulation include any regulation, rule, official directive, requirement, request or guideline (whether or not having the force of law but if not having the force of law being one with which persons to whom it is addressed or applicable generally comply) of any governmental, intergovernmental or supranational body, agency, authority, department or central bank or any regulatory, self-regulatory or other authority or organisation;

1.2.11

references to assets include all or part of any present and future business, undertaking, real property, personal property, uncalled capital, revenue and any rights of any description (whether actual or contingent, present or future) to receive, or require delivery of, any of the foregoing;

1.2.12

guarantee means any guarantee, letter of credit, bond, indemnity or similar assurance against loss, or any obligation, direct or indirect, actual or contingent, to purchase or assume any Indebtedness of any person or to make an investment in or loan to any person or to purchase assets of any person where, in each case, such obligation is assumed in order to maintain or assist the ability of such person to meet its Indebtedness and guaranteed shall be construed accordingly;

1.2.13

a law (1) includes any common law, statue, decree, constitution, regulation, order, judgment or directive of any governmental entity; (2) includes any treaty, pact, compact or other agreement to which any Government Entity is a signatory or party; (3) includes any judicial or administrative interpretation or application thereof and (4) is a reference to that provision as amended, substituted or re-enacted; and

1.2.14

references to any enactment shall be deemed to include references to such enactment as re-enacted, modified, amended or extended.

1.3	Offer letter

This Agreement supersedes the terms and conditions contained in any correspondence relating to the subject matter of this Agreement exchanged between any Facility Beneficiary and the Borrower or their representatives prior to the date of this Agreement.

2	The Loan and its Purposes

2.1	Amounts

Subject to the terms of this Agreement:

2.1.1

Each of the Commercial Facility Lenders agrees to make available to the Borrower its Commitment of a term loan facility in an aggregate amount not exceeding the Total Commercial Facility Commitments.

2.1.2

Each of the GIEK Facility Lenders agree to make available to the Borrower its Commitment of a term loan facility in an aggregate amount not exceeding the Total GIEK Facility Commitments.

2.2	Facility Beneficiaries’ obligations

2.2.1

The obligations of each Facility Beneficiary under the Facility Documents are several. Failure by a Facility Beneficiary to perform its obligations under the Facility Documents does not affect the obligations of any other party to the Facility Documents. No Facility Beneficiary is responsible for the obligations of any other Facility Beneficiary under the Facility Documents.

2.2.2

The rights of each Facility Beneficiary under or in connection with the Facility Documents are separate and independent rights and any debt arising under the Facility Documents to a Facility Beneficiary from a Security Party shall be a separate and independent debt.

2.2.3

A Facility Beneficiary may, except as otherwise stated in the Facility Documents, separately enforce its rights under the Facility Documents, provided that no Facility Beneficiary acting alone in its capacity as a Facility Lender shall be entitled to declare an Event of Default.

2.3	Purpose

The Borrower shall apply the Loans for the purposes referred to in the Recital.

2.4	Monitoring

No Facility Beneficiary is bound to monitor or verify the application of any amount borrowed under this Agreement.

3	Conditions of Utilisation

3.1	Conditions precedent to the Advance

The Facility Lenders will only be obliged to make the Advance if:

3.1.1

the Facility Agent (or its duly authorised representative) has received the documents and other evidence listed in Schedule 2, Part 1 of this Agreement;

3.1.2

on the date of the Drawdown Notice and on the proposed Drawdown Date no Default is continuing or would result from the making of the Advance;

3.1.3

on the date of the Drawdown Notice and on the proposed Drawdown Date the representations made by the Borrower under clause 11 (other than that in clauses 11.2, 11.6 and 11.18) are true in all material respects;

3.1.4

the amount of the Advance does not exceed the lower of (i) one hundred and fifty million Dollars ($150,000,000) and (ii) seventy per cent. (70%) of the Vessel Total Costs; and

3.1.5

the Total GIEK Facility Commitments do not exceed eighty five per cent. (85%) of the aggregate of the Eligible Costs and the Hiload Eligible Costs.

3.2	Drawing limit

The Facility Lenders will only be obliged to make the Advance if:

3.2.1

the proposed Drawdown Date is a Banking Day within the Availability Period;

3.2.2

there is no outstanding notice relating to the Facility from GIEK requiring the GIEK Facility Lenders to suspend the making of the Advance; and

3.2.3

the GIEK Agent (acting on the instructions of the GIEK Facility Lenders) is satisfied that the GIEK Guarantee is in full force and effect and shall apply to the Advance.

For the avoidance of doubt, only one (1) Advance shall be permitted to be made under the terms of this Agreement and such Advance shall be in accordance with this clause 3.

3.3	Termination Date

No Facility Lender shall or shall be under any obligation to advance all or any part of its Commitment after the end of the Availability Period and any such undrawn Commitments shall be reduced to zero on the last day of the Availability Period.

3.4	Conditions subsequent

It is acknowledged and agreed that the Drawdown Date may occur three (3) Banking Days prior to the Delivery Date. The Borrower undertakes to deliver or to cause to be delivered to the Facility Agent on, or as soon as reasonably practicable after, the Drawdown Date or, as the case may be, the Delivery Date (or within any time period specified in Schedule 2, Part 2 of this Agreement) the additional documents and other evidence listed in Schedule 2, Part 2 of this Agreement.

3.5	No Waiver

If the Facility Lenders in their sole discretion agree to make the Advance to the Borrower before all of the documents and evidence required by clause 3.1 have been delivered to or to the order of the Facility Agent, the Borrower undertakes to deliver all outstanding documents and evidence to or to the order of the Facility Agent no later than the date specified by the Facility Agent, except to the extent expressly waived by the Facility Agent in writing.

The making of the Advance under this clause 3.5 shall not be taken as a waiver of the Facility Lenders’ right to require production of all the documents and evidence required by clause 3.1.

3.6	Form and content

All documents and evidence delivered to the Facility Agent under this clause 3 shall:

3.6.1

be in form and substance reasonably acceptable to the Facility Agent; and

3.6.2

if reasonably required by the Facility Agent, be certified, notarised, legalised or attested in a manner acceptable to the Facility Agent.

4	Advance

4.1	Drawdown Request

Subject to clause 3, the Borrower may request the Advance to be advanced in one amount on any Banking Day prior to the end of the Availability Period by delivering to the Facility Agent a duly completed Drawdown Notice not more than ten (10) and not fewer than three (3) Banking Days before the proposed Drawdown Date or such shorter period as the Facility Agent may agree.

4.2	Facility Lenders’ participation

Subject to clauses 2 and 3, the Facility Agent shall promptly notify each Facility Lender of the receipt of the Drawdown Notice following which each Facility Lender shall advance the proportion which each Facility Lender’s Commitment bears to the Total Commitments, in each case, to the Borrower through the Facility Agent on the Drawdown Date.

4.3	Notwithstanding any other provision of a Facility Document to the contrary, if any GIEK Facility Lender or Commercial Facility Lender fails to make available its participation in the Advance to the Facility Agent, no amount of that Advance shall be made available to the Borrower.

5	Repayment

5.1	Repayment of the Loan

The Borrower will, on each Application Date, repay the Loan in an amount equal to the Repayment Amounts relating to that Application Date, with the amount specified in column (2) of the Schedule of Repayment Amounts being payable for the account of the GIEK Facility Lenders and the amount specified in column (3) of the Schedule of Repayment Amounts being payable for the account of the Commercial Facility Lenders. The Borrower shall on the Commercial Final Maturity Date repay to the Facility Agent as agent for the Commercial Facility Lenders, the Commercial Final Payment, together with all interest and all other amounts payable under this Agreement and the Facility Documents due to the Commercial Facility Lenders. The Borrower shall on the GIEK Final Maturity Date repay to the Facility Agent the GIEK Final Payment, together with all interest and other amounts payable under this Agreement, the Facility Documents and the GIEK Guarantee due to the GIEK Facility Lenders.

5.2	Reborrowing

No amounts repaid or prepaid under this Agreement may be reborrowed.

5.3	Replacement Schedule Repayment Amounts

5.3.1

The Original Schedule of Repayment Amounts has been prepared on the basis of the assumptions that:

(a)

The first Application Date shall occur six (6) months after the Drawdown Date;

(b)

There will be 20 Application Dates between the date hereof and the GIEK Final Maturity Date and there will be 12 Application Dates between the date hereof and the Commercial Final Maturity Date;

(c)

The total amount advanced will be one hundred and fifty million Dollars ($150,000,000); and

(d)

The GIEK Facility and the Commercial Facility shall each have a ten (10) year repayment profile.

5.3.2

If any or all of the assumptions made in clause 5.3.1 above proves to be incorrect, the Facility Agent shall prepare a Replacement Schedule of Repayment Amounts as soon as possible, however no later than ten (10) Banking Days following the last day of the Availability Period reflecting the actual facts and circumstances contemplated by those assumptions and such Replacement Schedule of Repayment Amounts shall (in the absence of manifest error) replace the Original Schedule of Repayment Amounts and shall be the Schedule of Repayment Amounts for all purposes of this Agreement. The Facility Agent shall notify all other parties to this Agreement (other than the Hedging Providers) of such recalculation and provide to them a copy of the Replacement Schedule of Repayment Amounts.

5.3.3

If at any time a prepayment of part of the Loan is made pursuant to the terms of this Agreement, the Facility Agent shall, following such prepayment, re-calculate the Original Schedule of Repayment Amounts or, as the case may be, any Replacement Schedule of Repayment Amounts and prepare a Replacement Schedule of Repayment Amounts (which, in the absence of manifest error, shall replace the existing Schedule of Repayment Amounts and shall be the Schedule of Repayment Amounts for all purposes of this Agreement) on the basis that the amount of such prepayment shall be applied in accordance with clause 6.12.4 of this Agreement. The Facility Agent shall notify all other parties to this Agreement (other than the Hedging Providers) of such recalculation and provide to them a copy of the Replacement Schedule of Repayment Amounts.

6	Prepayment

6.1	Mandatory prepayment of Loan caused by Illegality

If it becomes unlawful in any applicable jurisdiction for a Facility Lender to fund or maintain its Commitment as contemplated by this Agreement or to fund or maintain the Loan:

(a)

that Facility Lender shall promptly notify the Facility Agent of that event;

(b)

upon the Facility Agent notifying the Borrower, the Commitment of that Facility Lender (to the extent not already advanced) will be immediately cancelled; or

(c)

if advanced, the Borrower shall repay that Facility Lender’s Proportionate Share of the Loan on the last day of its current Interest Period or, if earlier, the date specified by that Facility Lender in the notice delivered to the Facility Agent and notified by the Facility Agent to the Borrower (being no earlier than the last day of any applicable grace period permitted by law) and the Loan shall be reduced by the amount of that Facility Lender’s Proportionate Share of the Loan. Prior to the date on which repayment is required to be made under this sub-clause (c) the affected Facility Lender shall negotiate in good faith with the Borrower to find an alternative method or lending base in order to maintain its Commitment in the Facility.

6.2	Sale or Disposal

In the event of a sale or disposal of the Vessel, or any sale of (i) the shares in the Borrower, and/or (ii) shares in the Bareboat Charterer or any interest in such shares, the Total Commitments shall be reduced to zero on the date of such sale or disposal. If any part of the Loan is outstanding the Borrower shall, on the date of the sale or disposal, prepay the Loan in full together with any other outstanding amounts in relation to the Facility Documents. Any such prepayment shall oblige the Borrower to make payment of all interest and Commitment Fee accrued on the amount so reduced up to and including the date of reduction together with any Break Costs in respect of such reduced amount if the date of such reduction is not the final day of an Interest Period. Any such reduction of the Total Commitments shall not be reversed.

6.3	Total Loss

In the event that the Vessel becomes a Total Loss, on the earlier to occur of (a) the date of receipt of the Total Loss Proceeds and (b) the date falling one hundred and eighty (180) days after the occurrence of the Total Loss, the Total Commitments shall be reduced to zero. Any such reductions in the Total Commitments shall not be reversed. If any part of the Loan is outstanding the Borrower shall, on the earlier to occur of (i) the date on which the Borrower receives such Total Loss Proceeds and (ii) the one hundred and eightieth day after the date of such Total Loss occurring, prepay the Loan in full PROVIDED ALWAYS that if such date is not the final day of an Interest Period, the Borrower may instead place the relevant sum in an account specified by the Facility Agent (acting on the instructions of the Majority Facility Lenders), charged to the Facility Security Trustee in a manner reasonably acceptable to the Majority Facility Lenders, with an irrevocable instruction to the Facility Agent to apply such sum in prepayment of the Loan on the final day of such Interest Period. Any such prepayment shall not be reborrowed and clause 8.3 shall apply to any such prepayment.

6.4	Change of Control

If:

(a)

at a time when all management powers over the business and affairs of TOO are vested in a general partner:

(i)

Teekay ceases to own directly or indirectly a minimum of fifty per cent. (50%) of the voting rights in the General Partner; or

(ii)

the General Partner ceases to be the general partner of TOO; or

(b)

at a time when all management powers over the business and affairs of TOO become vested in a board of directors of TOO, Teekay ceases to own or does not own, directly or indirectly, a minimum of fifty per cent. (50%) of the voting rights to elect the members of the board of directors of TOO or the voting rights to elect a minimum of fifty per cent. (50%) of the board of directors of TOO,

then unless such change of control has been remedied within thirty (30) days of such event occurring, the Total Commitments shall immediately be reduced to zero and the Borrower shall prepay the Loan in full. Any such reductions in the Total Commitments shall not be reversed.

6.5	Project Documents

In the event that the Charter is terminated or the Vessel has not been accepted under the Charter by 15 June 2015, then, unless a replacement charter is entered into within six (6) months, by the Bareboat Charterer and/or another Subsidiary of the Sponsor acceptable to the Facility Lenders (acting reasonably), on terms reasonably acceptable to the Facility Lenders, then the Total Commitments shall be immediately reduced to zero and the Borrower shall prepay the Loan in full.

6.6	Unlawfulness

In the event that any Transaction Document or any material provision thereof becomes unlawful, unenforceable or ineffective for any reason or any of the Facility Security Documents comprising a Security Interest ceases to constitute a valid first priority Security Interest over the asset or property to which it relates, and such unlawfulness, unenforceability, ineffectiveness or, as the case may be, lack of valid first priority Security Interest is not remedied, if remediable, to the satisfaction of the Facility Agent within thirty (30) days after written notice from the Facility Agent, the Total Commitments shall be reduced to zero and the Borrower shall prepay the Loan in full.

6.7	Abandonment

In the event that the Vessel is abandoned, the Total Commitments shall be reduced to zero and the Borrower shall prepay the Loan in full.

6.8	Termination of GIEK Guarantee

For so long as a GIEK Facility Lender is a Facility Lender, at any time the GIEK Guarantee ceases to be legal and enforceable or is cancelled by GIEK for any reason, the Borrower shall, on the date falling thirty (30) days after the date of notice thereof to the Borrower, prepay the Loan in full whereupon each Facility Lender’s Commitment shall be reduced to zero, unless prior to that time a replacement guarantee is issued by a guarantor acceptable to the GIEK Facility Lenders and which is in form and substance satisfactory to the GIEK Facility Lenders whereupon each GIEK Facility Lender’s Commitment shall remain unchanged.

6.9	Insolvency of Charterer

In the event that an Insolvency Event occurs in relation to the Charterer then unless a replacement charter is entered into within one hundred and eighty (180) days by the Bareboat Charterer with a replacement charterer, in each case acceptable to the Facility Agent (acting on the instructions of all the Facility Lenders (acting reasonably)) and GIEK, then the Total Commitments shall be immediately reduced to zero and the Borrower shall prepay the Loan in full.

6.10	Commercial Final Maturity Date

If the Commercial Final Payment has not been refinanced on terms and conditions satisfactory to the GIEK Agent (acting on the sole written instructions of GIEK) on or by the date falling two (2) months prior to the Commercial Final Maturity Date, the Borrower shall, if so requested on or by the date falling one (1) month prior to the Commercial Final Maturity Date by the Facility Agent (acting on the written instructions of GIEK through the GIEK Agent) prepay, on the Commercial Final Maturity Date the GIEK Loan outstanding and owing to the GIEK Facility Lenders and whereupon the Total Commitments shall be reduced to zero.

6.11	Voluntary prepayment of Loan

6.11.1

The Borrower may prepay the whole or any part of the Loan (but, if in part, being in a minimum amount of five million Dollars ($5,000,000) such amount to be in integral multiples of five million Dollars ($5,000,000) or such other amount as may be agreed by the Facility Agent) provided that it gives the Facility Agent not less than thirty (30) days’ prior written notice.

6.11.2

If any Facility Lender is a Notified Lender or if the Borrower is required to gross up its payments to a Facility Lender due to a withholding:

(a)

the Borrower may require that the Commitment of that Facility Lender (to the extent not already advanced) may be immediately cancelled; or

(b)

if advanced, the Borrower may repay that Facility Lender’s Proportionate Share of the Loan and the Loan shall be reduced by the amount of that Facility Lender’s Proportionate Share of the Loan.

6.11.3

If any Facility Lender is a Defaulting Facility Lender, the Borrower may require that the Commitment of that Facility Lender (to the extent not already advanced) may be immediately cancelled.

6.12	Restrictions and order of application

6.12.1

Any notice of prepayment given under this clause 6 shall be irrevocable and, unless a contrary indication appears in this Agreement, shall specify the date or dates upon which the relevant prepayment is to be made and the amount of that prepayment.

6.12.2

Any prepayment under this Agreement shall be made together with accrued interest on the amount prepaid and, subject to any Break Costs which shall be payable pursuant to clause 8.3, without premium or penalty. No amount prepaid shall be reborrowed.

6.12.3

If the Facility Agent receives a notice under this clause 6 it shall promptly forward a copy of that notice to the Borrower and/or the Facility Lenders, as appropriate.

6.12.4

The amount of any prepayment (other than a prepayment made in accordance with clauses 6.1, 6.11.2, 6.11.3 and/or 6.8 and/or 6.10) shall be applied towards prepayment of the Loans in inverse order of maturity of each Loan and on a pro rata basis across each Loan. For the avoidance of doubt, no prepayment fee shall apply.

7	Interest

7.1	Interest Periods

Subject to clause 7.2, each Interest Period shall be for a duration of six (6) months or if elected by the Borrower by written notice, three (3) months or such other duration as may be agreed by the Facility Agent (acting on the instructions of all the Facility Lenders) and provided in each case that the Facility Lenders have received two (2) Banking Days prior notice of such alternative duration and that no Interest Period may overrun an Application Date.

7.2	Beginning and end of Interest Periods

7.2.1

The initial Interest Period in respect of the Advance shall commence on the Drawdown Date for the Advance and end on the last day of that Interest Period selected in accordance with clause 7.1, but so that no Interest Period shall overrun an Application Date.

7.2.2

Any other Interest Period in respect of the Loan shall commence on the day following the last day of the previous Interest Period and shall end on the last day of its current Interest Period selected in accordance with clause 7.1 provided that if an Interest Period would otherwise overrun an Application Date, the last day of that Interest Period shall be that Application Date.

7.3	Interest Periods to meet GIEK Final Maturity Date, Commercial Final Maturity Date or Application Date

If an Interest Period would otherwise expire after the Commercial Final Maturity Date, the GIEK Final Maturity Date or any Application Date, that Interest Period shall expire on the Commercial Final Maturity Date, the GIEK Final Maturity Date or Application Date.

7.4	Non-Banking Days

If an Interest Period would otherwise end on a day which is not a Banking Day, that Interest Period will instead end on the next Banking Day in that calendar month (if there is one) or the preceding Banking Day (if there is not).

7.5	Interest rate

During each Interest Period interest shall accrue on the Loans at the rate determined by the Facility Agent to be the aggregate of (a) the applicable Margin and (b) LIBOR.

7.6	Accrual and payment of interest

Interest, fees and/or premia shall accrue from day to day, shall be calculated on the basis of a 360 day year and the actual number of days elapsed (or, in any circumstance where market practice differs, in accordance with the prevailing market practice) and shall be paid by the Borrower to the Facility Agent for the account of the Facility Lenders on the last day of each Interest Period.

7.7	Default interest

If the Borrower fails to pay any amount payable by it under a Facility Document on its due date, interest shall accrue on the overdue amount from the due date, subject to any applicable grace period, up to the date of actual payment (both before and after judgment) at a rate which is one point five per cent (1.5%) higher than the rate which would have been payable if the overdue amount had, during the period of non-payment, constituted the Loan for successive Interest Periods, each selected by the Facility Agent (acting reasonably). Any interest accruing under this clause 7.7 shall be immediately payable by the Borrower on demand by the Facility Agent. If unpaid, any such interest will be compounded with the overdue amount at the end of each Interest Period applicable to that overdue amount but will remain immediately due and payable.

7.8	Market disruption

7.8.1

(a)

If a Market Disruption Event specified in clause 7.8.2(a) occurs in relation to the Loan for any Interest Period, then the rate of interest on each Facility Lender’s share of the Loan for the Interest Period shall be the percentage rate per annum which is the sum of:

(i)

the applicable Margin; and

(ii)

the rate notified to the Facility Agent by that Facility Lender as soon as practicable and in any event before interest is due to be paid in respect of that Interest Period, to be that which expresses as a percentage rate per annum the cost to that Facility Lender of funding its participation in the Loan from whatever source it may reasonably select.

(b)

If a Market Disruption Event specified in clause 7.8.2(b) occurs in relation to the Loan for any Interest Period, then the rate of interest on each Notified Lender’s share of the Loan for the Interest Period shall be the percentage rate per annum which is the sum of:

(i)

the applicable Margin; and

(ii)

the rate notified to the Facility Agent by that Notified Lender as soon as practicable and in any event before interest is due to be paid in respect of that Interest Period, to be that which expresses as a percentage rate per annum the cost to that Notified Lender of funding its participation in the Loan from whatever source it may reasonably select.

7.8.2

In this Agreement Market Disruption Event means:

(a)

at or about 11.00 am London time two (2) London Banking Days before the first day of the relevant Interest Period neither the Screen Rate nor the Interpolated Screen Rate is available and none or only one of the Reference Banks supplies a rate to the Facility Agent to determine LIBOR for the relevant currency and Interest Period; or

(b)

before close of business in London two (2) London Banking Days before the first day of the relevant Interest Period, the Facility Agent receives notifications from a Facility Lender or Facility Lenders (whose participations in the Loan exceed fifty per cent. of the Loan or more) (each a Notified Lender) that the cost to it of obtaining matching deposits in the London interbank market would be in excess of LIBOR.

7.9	Alternative basis of interest or funding

7.9.1

If a Market Disruption Event occurs and the Facility Agent or the Borrower so requires, the Facility Agent and the Borrower shall enter into negotiations (for a period of not more than thirty days) with a view to agreeing a substitute basis for determining the rate of interest.

7.9.2

Any alternative basis agreed pursuant to clause 7.9.1 above shall:

(a)

In the case of a Market Disruption Event specified in clause 7.8.2(a), with the prior consent of all the Facility Lenders and the Borrower, be binding on all parties; and

(b)

In the case of a Market Disruption Event specified in clause 7.8.2(b), with the prior consent of all the Notified Lenders and the Borrower be binding on all parties (but such alternative basis shall not be applicable to the Facility Lenders which are not Notified Lenders).

7.10	Determinations conclusive

The Facility Agent shall promptly notify the Borrower of the determination of a rate of interest under this clause 7 and each such determination shall (save in the case of manifest error) be final and conclusive.

8	Indemnities

8.1	Transaction expenses

The Borrower will, within fourteen (14) days of the Facility Agent’s written demand, pay the Facility Agent (for the account of the Facility Beneficiaries and/or GIEK) the amount of all out of pocket costs and expenses (including legal fees reasonably incurred, the cost of obtaining an initial insurance report (and of obtaining further insurance reports only if there is a material change in the terms of the Insurances or material change in the marine insurance market), and Value Added Tax or any similar or replacement tax if applicable) reasonably incurred by the Facility Beneficiaries and/or GIEK or any of them in connection with:

8.1.1

the negotiation, preparation, printing, execution, syndication, administration and registration of the Facility Documents, the GIEK Guarantee and the Hedging Agreements (whether or not any Facility Document, the GIEK Guarantee or the Hedging Agreement is actually executed or registered and whether or not the Advance is made);

8.1.2

any amendment, addendum or supplement to any Facility Document, the GIEK Guarantee or the Hedging Agreement (whether or not completed); and

8.1.3

any other document which may at any time be reasonably required by a Facility Beneficiary and/or GIEK to give effect to any Facility Document, the GIEK Guarantee or the Hedging Agreement or which a Facility Beneficiary and/or GIEK is entitled to call for or obtain under any Facility Document, the GIEK Guarantee or the Hedging Agreement.

8.2	Funding costs

The Borrower shall indemnify each Facility Beneficiary, by payment to the Facility Agent (for the account of that Facility Beneficiary) on the Facility Agent’s written demand, against all losses and costs incurred or sustained by that Facility Beneficiary if, for any reason due to a default or other action by the Borrower, the Advance is not made to the Borrower after the Drawdown Notice has been given to the Facility Agent, or is advanced on a date other than that requested in the Drawdown Notice.

8.3	Break Costs

As a result of a Facility Beneficiary receiving any prepayment of all or any part of the Loan (whether pursuant to clause 6 or otherwise) on a day other than the last day of an Interest Period, or any other payment under or in relation to the Facility Documents on a day other than the due date for payment of the sum in question, the Borrower shall indemnify each Facility Beneficiary, by payment to the Facility Agent (for the account of that Facility Beneficiary) within three (3) Banking Days of the Facility Agent’s written demand, against all documented costs, losses, premiums or penalties incurred by that Facility Beneficiary, including (without limitation) the Break Costs, any losses or costs incurred in liquidating or re-employing deposits from third parties acquired to effect or maintain all or any part of the Loan.

8.4	Currency indemnity

In the event of a Facility Beneficiary receiving or recovering any amount payable under a Facility Document in a currency other than the Currency of Account, and if the amount received or recovered is insufficient when converted into the Currency of Account at the date of receipt to satisfy in full the amount due, the Borrower shall, on the Facility Agent’s written demand, pay to the Facility Agent for the account of the relevant Facility Beneficiary such further amount in the Currency of Account as is sufficient to satisfy in full the amount due and that further amount shall be due to the Facility Agent on behalf of the relevant Facility Beneficiary as a separate debt under this Agreement.

8.5	Increased costs (subject to clause 8.6)

If, by reason of any Change in Law:

8.5.1

a Facility Beneficiary (or the holding company of a Facility Beneficiary) shall be subject to any Tax with respect to payment of all or any part of the Indebtedness (other than Tax on overall net income); or

8.5.2

the basis of Taxation of payments to a Facility Beneficiary in respect of all or any part of the Indebtedness shall be changed; or

8.5.3

any reserve requirements shall be imposed, modified or deemed applicable against assets held by or deposits in or for the account of or loans by any branch of a Facility Beneficiary; or

8.5.4

the manner in which a Facility Beneficiary allocates capital resources to its obligations under this Agreement or any ratio (whether cash, capital adequacy, liquidity or otherwise) which a Facility Beneficiary is required or requested to maintain shall be affected; or

8.5.5

there is imposed on a Facility Beneficiary (or on the holding company of a Facility Beneficiary) by an unconnected third party any other condition in relation to the Indebtedness or the Facility Documents,

and the result of any of the above shall be to increase the cost to a Facility Beneficiary (or to the holding company of a Facility Beneficiary) of that Facility Beneficiary making or maintaining its Commitment, or to cause a Facility Beneficiary (or to the holding company of a Facility Beneficiary) to suffer (in its opinion) a material reduction in the rate of return on its overall capital below the level which it reasonably anticipated at the date of this Agreement and which it would have been able to achieve but for its entering into this Agreement and/or performing its obligations under this Agreement, then, subject to clause 8.6, the Facility Beneficiary affected shall notify the Facility Agent and the Borrower shall from time to time pay to the Facility Agent on demand for the account of that Facility Beneficiary the amount which shall compensate that Facility Beneficiary (or the relevant holding company) for such additional cost or reduced return. A certificate signed by an authorised signatory of that Facility Beneficiary setting out the amount of that payment and the basis of its calculation shall be submitted to the Borrower and shall be conclusive evidence of such amount save for manifest error or on any question of law.

8.6	Exceptions to increased costs

Clause 8.5 does not apply to the extent any additional cost or reduced return referred to in that clause is:

8.6.1

compensated for by a payment made under clause 8.12; or

8.6.2

compensated for by a payment made under clause 17.3; or

8.6.3

attributable to the wilful breach by the relevant Facility Beneficiary (or the holding company of that Facility Beneficiary) of any law or regulation; or

8.6.4

a FATCA Deduction.

8.7	Events of Default

The Borrower shall indemnify each Facility Beneficiary and/or GIEK from time to time, by payment to the Facility Agent (for the account of that Facility Beneficiary and/or GIEK) on the Facility Agent’s written demand, against all losses and costs incurred or sustained by that Facility Beneficiary and/or GIEK as a consequence of any Event of Default.

8.8	Enforcement costs

The Borrower shall pay to the Facility Agent (for the account of each Facility Beneficiary and/or GIEK) on the Facility Agent’s written demand the amount of all costs and expenses (including legal fees) incurred by a Facility Beneficiary and/or GIEK in connection with the holding, enforcement of, or the preservation of any rights under, any Facility Document and/or the GIEK Guarantee including (without limitation) any losses, costs and expenses which that Facility Beneficiary, and/or GIEK may from time to time sustain, incur or become liable for by reason of that Facility Beneficiary and/or GIEK being mortgagee of the Vessel and/or holder of the Facility Secured Property and/or a lender to the Borrower, or by reason of that Facility Beneficiary and/or GIEK being deemed by any court or authority to be an operator or controller, or in any way concerned in the operation or control, of the Vessel. No such indemnity will be given where any such loss or cost has occurred due to gross negligence or wilful misconduct on the part of that Facility Beneficiary and/or GIEK; however, this shall not affect the right of any other Facility Beneficiary and/or GIEK to receive such indemnity.

8.9	Other costs

The Borrower shall pay to the Facility Agent (for the account of each Facility Beneficiary) on the Facility Agent’s written demand the amount of all sums which a Facility Beneficiary may pay or become actually or contingently liable for on account of the Borrower in connection with the Vessel (whether alone or jointly or jointly and severally with any other person) including (without limitation) all sums which that Facility Beneficiary may pay or guarantees which it may give in respect of the Insurances, any expenses incurred by that Facility Beneficiary in connection with the maintenance or repair of the Vessel or in discharging any lien, bond or other claim relating in any way to the Vessel, and any sums which that Facility Beneficiary may pay or guarantees which it may give to procure the release of the Vessel from arrest or detention.

8.10	General indemnity

8.10.1

The Borrower hereby agrees at all times to pay promptly or, as the case may be, indemnify and hold the Facility Beneficiaries, GIEK and the Affiliates of any Facility Beneficiary, GIEK and each of them and their respective officers, directors, representatives, agents and employees (together the Indemnified Parties) harmless on a full indemnity basis from and against each and every Loss suffered or incurred by or imposed on any Indemnified Party related to or arising out of:

(a)

the use of proceeds of the Facility;

(b)

the execution and delivery of any commitment letter, engagement letter, fee letter, the Facility Documents or any other document connected therewith or the performance of the respective obligations thereunder, including without limitation environmental liabilities; or

(c)

any claim, action, suit, investigation or proceeding relating to the foregoing or the Security Parties, whether or not any Indemnified Party is a party thereto or target thereof, or the Indemnified Parties’ roles in connection therewith, and will reimburse the Indemnified Parties, on demand, for all reasonable expenses (including reasonable counsel fees and expenses) as they are incurred by the Indemnified Parties in connection with investigating, preparing for or defending any such claim, action, suit or proceeding (including any security holder actions or proceeding, inquiry or investigation), whether or not in connection with pending or threatened litigation in which the Security Parties are a party.

8.10.2

The Borrower will not, however, be responsible for any claims, liabilities, losses, damages or expenses of an Indemnified Party that are finally judicially determined by a court of competent jurisdiction to have resulted from the wilful misconduct or gross negligence by such Indemnified Party.

8.10.3

The foregoing shall be in addition to any rights that the Indemnified Parties may have at common law or otherwise and shall extend upon the same terms to and inure to the benefit of any affiliate, director, officer, employee, agent or controlling person of an Indemnified Party.

8.11	Environmental indemnity

The Borrower shall indemnify on demand and hold harmless each of the Indemnified Parties in respect of each and every Loss, of whatever nature (including, without limitation, those arising under Environmental Laws) which may be incurred or made against the Indemnified Parties at any time relating to, or arising directly or indirectly in any manner or for any cause or reason whatsoever out of an Environmental Claim relating to the Vessel, the Borrower, the Bareboat Charterer and/or the Manager made or asserted against the Indemnified Parties which would or could not have been brought if the Indemnified Parties had not entered into any of the Facility Documents or been involved in any of the transactions contemplated by the Facility Documents. To the extent that an Indemnified Party would be entitled to recover an Loss under clause 8.10 and/or this clause 8.11, that Indemnified Party shall not be entitled to recover for that Loss or payment twice.

8.12

Taxes

The Borrower shall pay all Taxes to which all or any part of the Facility Secured Obligations, any Facility Document and/or the GIEK Guarantee may be at any time subject (other than Tax on a Facility Beneficiary’s and/or GIEK’s overall net income) and shall indemnify the Facility Beneficiaries and GIEK, by payment to the Facility Agent (for the account of the Facility Beneficiaries and GIEK) on the Facility Agent’s written demand, against all liabilities, costs, claims and expenses resulting from any omission to pay or delay in paying any such Taxes.

8.13

GIEK

The Borrower agrees, and shall procure that the other Security Parties agree, that if GIEK makes a payment to the GIEK Facility Lenders (whether through the GIEK Agent or otherwise) pursuant to the GIEK Guarantee, the GIEK Facility Lenders (whether through the GIEK Agent or otherwise) may act on the instructions of GIEK and the Security Parties shall have no claims whatsoever in respect of any loss, damage or expense suffered or incurred by them as a result of actions or lack of actions taken which are consistent with such instruction.

Fees

9.1	Commitment fee

9.1.1

The Borrower shall pay to the Facility Agent (for the account of the Facility Lenders in proportion to their undrawn Commitments) a commitment fee at a per annum rate of thirty per cent. (30%) of the applicable Margin on the daily undrawn and uncancelled amount of the Total Commitments accruing from the date of this Agreement until the earlier of (i) the end of the Availability Period and (ii) the date upon which the Total Commitments are reduced to zero.

9.1.2

The Borrower shall pay to the Facility Agent (for the account of GIEK) a commitment fee at a per annum rate of thirty per cent. (30%) of the GIEK Premium on the daily undrawn and uncancelled amount of the Total GIEK Facility Commitments accruing from the date of this Agreement until the end of the Availability Period.

9.1.3

The accrued Commitment Fee is payable in arrears on the last day of each successive period of six (6) months commencing from the date of this Agreement and ending on the earlier of (i) the last day of the Availability Period, and (ii) the date upon which the Total Commitments are reduced to zero.

9.2	Upfront fee

The Borrower shall pay any other fees set out in the Fee Letter in the amount and at the times agreed in the applicable Fee Letter.

9.3	Agency fee

The Borrower shall pay to the Facility Agent an agency fee in the amount and at the times agreed in a Fee Letter.

9.4	Security Trustee Fee

The Borrower shall pay to the Facility Security Trustee a trustee fee in the amount and at the times agreed in a Fee Letter.

9.5	GIEK Premium

9.5.1

The Borrower acknowledges that the GIEK Facility Lenders shall procure the issue of the GIEK Guarantee either through the GIEK Agent or directly with GIEK and shall benefit from it throughout the duration of the Facility Security Period. The Borrower agrees to pay to the Facility Agent (for the account of GIEK) the GIEK Premium on each Interest Payment Date.

9.5.2

The Borrower agrees that its obligation to make the payments set out in clause 9.5.1 to the Facility Agent in respect of the GIEK Premium (or any part thereof) shall be an absolute obligation and shall not be affected by any matter whatsoever. The GIEK Premium (or any part thereof) shall not be refundable except in accordance with the terms of the GIEK Guarantee and GIEK’s internal regulations.

9.5.3

The Borrower acknowledges that the amount of the GIEK Premium will be solely determined by GIEK and no Facility Beneficiary is in any way involved in the determination of the amount of the GIEK Premium and agrees that the Borrower shall have no claim or defence against any Facility Beneficiary in connection with the amount of the GIEK Premium.

10	Security and Application of Moneys

10.1	Facility Security Documents

As security for the payment of the Facility Secured Obligations, the Borrower shall execute and deliver to the Facility Security Trustee or cause to be executed and delivered to the Facility Security Trustee at the relevant time, the following documents in such forms and containing such terms and conditions as the Facility Agent and the Facility Security Trustee shall require:

10.1.1

a first priority statutory mortgage over the Vessel together with a collateral deed of covenants;

10.1.2

a first priority deed of assignment of the Insurances, Earnings, Bareboat Charter and Requisition Compensation of the Vessel, and of the benefit of the Bareboat Charterer Assignment (which includes an assignment of benefits under the Charter);

10.1.3

an irrevocable, unconditional, first priority on demand guarantee and indemnity from TOO;

10.1.4

a first priority charge from the Shareholder over all the shares in the Borrower;

10.1.5

a first priority account charge in respect of the Earnings Account and the Bareboat Charterer Earnings Account (which in both cases will be unblocked prior to the occurrence of an Event of Default);

10.1.6

the Borrower Security Power of Attorney and the Bareboat Charterer Security Power of Attorney;

10.1.7

a first priority deed of charge over the Hedging Agreements;

10.1.8

if the Manager is not a member of either the TOO Group or Teekay Group, the Manager Undertaking.

10.2	Remittance of Revenue

At all times during the Facility Security Period, the Borrower shall procure that all Revenue, Earnings, Insurance Proceeds, any amounts of cancellation fee or termination fee or other amount payable under or pursuant to the Charter and/or the Bareboat Charter, any amounts of warranty payments payable under or pursuant to the Building Contract and Total Loss Proceeds are paid to the Earnings Account or the Bareboat Charterer Earnings Account or such other account as the Facility Agent shall from time to time specify by notice in writing to the Borrower.

10.3	General application of moneys

Whilst an Event of Default is continuing unremedied or unwaived the Borrower irrevocably authorises the Facility Agent and the Facility Security Trustee to apply all sums which either of them may receive:

10.3.1

pursuant to a sale or other disposition of the Vessel or any right, title or interest in the Vessel; or

10.3.2

by way of payment of any sum in respect of the Insurances, Earnings, Revenue or Requisition Compensation; or

10.3.3

otherwise arising under or in connection with any Facility Document,

in or towards satisfaction, or by way of retention on account, of the Facility Secured Obligations, as follows:

(i)

first in payment of all fees, liabilities and expenses of the Facility Security Trustee which are outstanding under a Facility Document;

(ii)

secondly, in or towards payment on a pro rata and pari passu basis of all fees, liabilities and expenses of the Facility Agent and the GIEK Agent which are outstanding under a Facility Document;

(iii)

thirdly in or towards payment on a pari passu and pro rata basis to the Facility Beneficiaries (other than the Hedging Providers) of an amount equal to the Facility Secured Obligations (but excluding the Hedging Secured Obligations);

(iv)

fourthly in or towards payment on a pari passu and pro rata basis to the Hedging Providers of an amount equal to the Hedging Secured Obligations;

(v)

the balance, if any, shall be remitted to the Borrower.

11	Representations and Warranties

The Borrower represents and warrants to each of the Facility Beneficiaries at the date of this Agreement and (by reference to the facts and circumstances then pertaining) at the date of the Drawdown Notice, at the Drawdown Date and at each Interest Payment Date as follows (except that the representation and warranty contained at clause 11.2 shall only be made on the date of this Agreement and the representations and warranties contained at clauses 11.6 and 11.18 shall only be repeated on the Drawdown Date):

11.1	Status and Due Authorisation

Each of the Security Parties is a corporation, limited liability company or limited partnership duly incorporated or formed under the laws of its jurisdiction of incorporation, organisation or formation (as the case may be) with power to enter into the Facility Documents and to exercise its rights and perform its obligations under the Facility Documents and all corporate and other action required to authorise its execution of the Facility Documents and its performance of its obligations thereunder has been duly taken.

11.2	No Deductions or Withholding

Under the laws of the Security Parties’ respective jurisdictions of incorporation or formation in force at the date hereof, none of the Security Parties will be required to make any deduction or withholding from any payment it may make under any of the Facility Documents.

11.3	Claims Pari Passu

Under the laws of the Security Parties’ respective jurisdictions of incorporation or formation in force at the date hereof, the Facility Secured Obligations will, to the extent that it exceeds the realised value of any security granted in respect of the Facility Secured Obligations, rank at least pari passu with all the Security Parties’ other unsecured indebtedness save that which is preferred solely by any bankruptcy, insolvency or other similar laws of general application.

11.4	No Immunity

In any proceedings taken in any of the Security Parties’ respective jurisdictions of incorporation or formation in relation to any of the Facility Documents, none of the Security Parties will be entitled to claim for itself or any of its assets immunity from suit, execution, attachment or other legal process.

11.5	Governing Law and Judgments

In any proceedings taken in any of the Security Parties’ jurisdiction of incorporation or formation in relation to any of the Facility Documents in which there is an express choice of the law of a particular country as the governing law thereof, that choice of law and any judgment or (if applicable) arbitral award obtained in that country will be recognised and enforced.

11.6	Validity and Admissibility in Evidence

As at the Delivery Date, all acts, conditions and things required to be done, fulfilled and performed in order (a) to enable each of the Security Parties lawfully to enter into, exercise its rights under and perform and comply with the obligations expressed to be assumed by it in the Facility Documents, (b) to ensure that the obligations expressed to be assumed by each of the Security Parties in the Facility Documents are legal, valid and binding and (c) to make the Facility Documents admissible in evidence in the jurisdictions of incorporation or formation of each of the Security Parties, have been done, fulfilled and performed save for (i) the Brazilian Certification and Registration Requirements which is a condition subsequent pursuant to Schedule 2, Part 2, paragraph 6 of this Agreement and (ii) the registration of the relevant Facility Documents at the competent Registry of Deeds and Documents (Cartório de Registro de Titulos e Documentos) in Brazil and (iii) registration of particulars of charge created by the relevant Facility Documents at the Accounting and Corporate Regulatory Authority in Singapore under section 131 of the Companies Act (Chapter 50) of Singapore.

11.7	Intentionally omitted

11.8	Binding Obligations

The obligations expressed to be assumed by each of the Security Parties in the Facility Documents are legal and valid obligations, binding on each of them in accordance with the terms of the Facility Documents and no limit on any of their powers will be exceeded as a result of the borrowings, granting of security or giving of guarantees contemplated by the Facility Documents or the performance by any of them of any of their obligations thereunder.

11.9	No Winding-up

The Borrower has not taken any corporate or limited partnership action nor have any other steps been taken or legal proceedings been started or (to the best of the Borrower’s knowledge and belief) threatened against the Borrower for its winding-up, dissolution, administration or reorganisation or for the appointment of a receiver, administrator, administrative receiver, trustee or similar officer of it or of any or all of its assets or revenues which might have a material adverse effect on the business or financial condition of the TOO Group taken as a whole.

11.10

Solvency

11.10.1

Neither the Borrower nor the TOO Group taken as a whole is unable, or admits or has admitted its inability, to pay its debts or has suspended making payments in respect of any of its debts.

11.10.2

Neither the Borrower nor the TOO Group taken as a whole has by reason of actual or anticipated financial difficulties, commenced, or intends to commence, negotiations with one or more of its creditors with a view to rescheduling any of its indebtedness.

11.10.3

The value of the assets of each of the Borrower and the TOO Group taken as a whole is not less than the liabilities of such entity or the TOO Group taken as a whole (as the case may be) (taking into account contingent and prospective liabilities).

11.10.4

No moratorium has been, or may, in the reasonably foreseeable future be, declared in respect of any indebtedness of the Borrower or of the TOO Group taken as a whole.

11.11

No Material Defaults

11.11.1

Without prejudice to clause 11.11.2, the Borrower is not in breach of or in default under any agreement to which it is a party or which is binding on it or any of its assets or any Applicable Law to an extent or in a manner which might have a material adverse effect on the business or financial condition of the TOO Group taken as a whole.

11.11.2

No Default is continuing or might reasonably be expected to result from the making of the Advance.

11.12

No Material Proceedings

No action or administrative proceeding of or before any court, arbitral body or agency which is not covered by adequate insurance or which might have a material adverse effect on the business or financial condition of the TOO Group taken as a whole has been started or is reasonably likely to be started.

11.13

No Obligation to Create Security

The execution of the Facility Documents by the Security Parties and their exercise of their rights and performance of their obligations thereunder will not result in the existence of nor oblige the Borrower to create any Security Interest (other than a Permitted Security Interest) over all or any of their present or future revenues or assets, other than pursuant to the Facility Security Documents.

11.14

No Breach

The execution of the Facility Documents by each of the Security Parties and their exercise of their rights and performance of their obligations under any of the Facility Documents do not constitute and will not result in any breach of any agreement or treaty to which any of them is a party.

11.15

Security

Each of the Security Parties is or will, on the Delivery Date be, the legal and beneficial owner of all assets and other property which it purports to charge, mortgage, pledge, assign or otherwise secure pursuant to each Facility Security Document and those Facility Security Documents to which it is a party create and give rise to valid and effective security having the ranking expressed in those Facility Security Documents.

11.16

Necessary Authorisations

The Necessary Authorisations required by each Security Party are in full force and effect, and each Security Party is in compliance with the material provisions of each such Necessary Authorisation relating to it and, to the best of its knowledge, none of the Necessary Authorisations relating to it are the subject of any pending or threatened proceedings or revocation.

11.17

Money Laundering

Any amount borrowed hereunder, and the performance of the obligations of the Security Parties under the Facility Documents, will be for the account of members of the TOO Group and will not involve any breach by any of them of any law or regulatory measure relating to “money laundering” as defined in Article 1 of the Directive (2005/60/EEC) of the Council of the European Communities.

11.18

Disclosure of material facts

(a)

The Borrower is not aware of any material facts or circumstances which:

(i)

have not been disclosed to the Facility Agent; and

(ii)

if disclosed, might have reasonably been expected to adversely affect the decision of a person considering whether or not to make loan facilities of the nature contemplated by this Agreement available to the Borrower and/or issue the GIEK Guarantee.

(b)

All information provided by any Security Party or member of the TOO Group to any of the Facility Beneficiaries in connection with the Transaction Documents or the transactions referred to therein is accurate and correct in all material respects at the time it was given or made.

11.19

Use of Facility

The Facility will be used for the purposes specified in the Recital.

11.20

Anti-Bribery and Corruption

The Borrower has conducted and is conducting its business in compliance with all anti-bribery and corruption laws and anti-money laundering laws, and maintains and is maintaining policies and procedures designed to promote and achieve compliance with such laws.

11.21

Taxation

11.21.1

Each of the Security Parties is not materially overdue in the filing of any Tax returns and each Security Party is not overdue in the payment of any amount in respect of Tax of five million Dollars ($5,000,000) (or its equivalent in any other currency) or more, save in the case of Taxes which are being contested on bona fide grounds.

11.21.2

No claims or investigations are being made or conducted against any Security Party with respect to Taxes such that a liability of, or claim against, any Security Party is reasonably likely to arise.

11.22

Sanctions

Neither the Borrower, nor any of its Subsidiaries, nor any of its or their respective officers, directors, employees, nor to the knowledge of the Borrower, any Affiliate, or Security Party:

(a)

is, or is owned or controlled by a person or entity that is, the subject of any trade economic or financial sanction or restrictive measure administered, enacted or enforced by the Office of Foreign Assets Control of the United States Department of the Treasury, the United States Department of State, the United Nations Security Council, the European Union, Her Majesty’s Treasury and/or other relevant sanctions authority (each a Sanction); or

(b)

is located, organised or residing in any country or territory to the extent that such country or territory itself is, or government is, the subject of any Sanction (each a Restricted Jurisdiction); or

(c)

has engaged or is engaging in any trade, business or other activities which is in breach of any sanction.

Neither the Loan, nor the proceeds from the Loan, has been or shall be used, directly or (to the knowledge of the Borrower) indirectly, to lend, contribute, provide or has otherwise made available to fund any activity or business in any Restricted Jurisdiction or to fund any activity or business or any person, vessel or entity located, organised or residing in any Restricted Jurisdiction or who is the subject of any Sanction, or in any other manner that will result in any violation by any person (including but not limited to any Facility Beneficiary) of any Sanction.

11.23

Representations Limited

The representation and warranties of the Borrower in this clause 11 are subject to:

11.23.1

the principle that equitable remedies are remedies which may be granted or refused at the discretion of the court;

11.23.2

the limitation of enforcement by laws relating to bankruptcy, insolvency, liquidation, reorganisation, court schemes, moratoria, administration and other laws generally affecting or limiting the rights of creditors;

11.23.3

the time barring of claims under any applicable limitation acts;

11.23.4

the possibility that a court may strike out provisions for a contract as being invalid for reasons of oppression, undue influence or similar; and

11.23.5

any other reservations or qualifications of law expressed in any legal opinions obtained by the Facility Agent in connection with the Facility.

12	Undertakings and Covenants

The undertakings and covenants in this clause 12 remain in force for the duration of the Facility Security Period.

12.1	General Undertakings

12.1.1

Financial statements

The Borrower shall supply to the Facility Agent as soon as the same become available, but in any event within one hundred and eighty (180) days after the end of each of its financial years, its audited unconsolidated financial statements for that financial year, prepared in accordance with GAAP, and cashflows.

12.1.2

Interim financial statements

The Borrower shall supply to the Facility Agent as soon as the same become available, but in any event within one hundred and twenty (120) days after the end of each half financial year ending 30 June, its unaudited semi-annual unconsolidated financial statements for that fiscal half financial year, signed by a duly authorised representative of the Borrower, and cashflows.

12.1.3

Maintenance of Legal Validity

The Borrower shall obtain, comply with the terms of and do all that is necessary to maintain in full force and effect:

(a)

all authorisations, approvals, licences and consents required in or by the laws and regulations of its jurisdiction of formation and all other applicable jurisdictions, to enable it lawfully to enter into and perform its obligations under the Facility Documents and to ensure the legality, validity, enforceability or admissibility in evidence of the Facility Documents in its jurisdiction of incorporation or organisation and all other applicable jurisdictions; and

(b)

the Earnings Account.

12.1.4

Notification of Event of Default

The Borrower shall promptly, upon becoming aware of the same, inform the Facility Agent in writing of the occurrence of any Event of Default and, upon receipt of a written request to that effect from the Facility Agent, confirm to the Facility Agent that, save as previously notified to the Facility Agent or as notified in such confirmation, no Event of Default has occurred.

12.1.5

Other notifications

The Borrower shall promptly, upon becoming aware of the same, inform the Facility Agent in writing of any Environmental Claim pending or made against it or any of its Environmental Affiliates or in connection with the Vessel.

12.1.6

Claims Pari Passu

The Borrower shall ensure that at all times the claims of the Facility Beneficiaries against it under the Facility Documents rank at least pari passu with the claims of all its other unsecured creditors save those whose claims are preferred by any bankruptcy, insolvency, liquidation, winding-up or other similar laws of general application.

12.1.7

Management of Vessel

The Borrower shall ensure that the Vessel is at all times technically and commercially managed by the Manager in accordance with good industry standards.

12.1.8

Classification

The Borrower shall ensure that the Vessel maintains the highest classification required for the purpose of the relevant trade of the Vessel which shall be with a Classification Society free from any overdue recommendations and conditions affecting the Vessel’s class.

12.1.9

Manager

The Borrower shall ensure that the only entity operating the Vessel shall be (i) the Manager or (ii) another person acceptable to the Facility Agent (acting on the instructions of all the Lenders and GIEK, each acting reasonably) which has become a party to the Management Agreement.

12.1.10

Sanctions

The Borrower shall (and shall procure that each of its Subsidiaries shall) comply with all Sanctions.

The Borrower understands that the Facility Lenders – be it due to applicable laws, sanctions or internal rules and regulations, are prohibited from conducting transactions, including finance transactions, with the government of or any person or entity owned or controlled by the government of a Restricted Jurisdiction (as such term is defined in clause 11.22 of this Agreement), or Restricted Persons.

The Borrower shall, and shall procure that each Security Party shall not transfer, lend, contribute, make use of or provide, directly or indirectly, the benefits of any money, proceeds or services provided by or received from the Facility Lenders to any Restricted Persons or conduct any business activity (such as entering into any ship acquisition agreement, any ship refinancing agreement and/or any charter agreement) related to a vessel, project asset or otherwise which is the subject of Sanctions or for which money, proceeds or services have been received from the Facility Lenders with any Restricted Persons or in any other manner which would reasonably be expected to result in any person (including but not limited to any Facility Beneficiary) being in breach of Sanctions or becoming a Restricted Person.

The Borrower shall, and shall procure that each Security Party shall, not fund all or part of any payment in connection with a Facility Document out of proceeds derived from business or transaction with a Restricted Person or from any action which is in breach of any Sanction.

In this clause 12.1.10, Restricted Persons means persons, vessels, entities or any other parties: (i) located, domiciled, resident or incorporated in a Restricted Jurisdiction; (ii) subject to any Sanction (as such term is defined in clause 11.22 of this Agreement); and/or (iii) owned or controlled by or affiliated with persons, entities or any other parties as referred to in (i) and (ii).

12.1.11

Capex

The Borrower shall provide to the Facility Agent on an annual basis the budget outlining (i) the capital expenditure requirements for the immediately following period of twelve (12) months including commentary on any technical issues, downtime and operational record and (ii) such capital expenditure should not exceed ten millions Dollars (US$10,000,000) per annum unless any excess is funded by further equity or debt provided to the Borrower in accordance with the terms of clause 12.1.25(a).

12.1.12

Negative Pledge

The Borrower shall not create, or permit to subsist, any Security Interest over all or any part of its assets (including but not limited to the Vessel and the Insurances) other than a Permitted Security Interest.

12.1.13

Registration

The Borrower shall not for the duration of the Facility Security Period change or permit a change to the flag of the Vessel other than to a Flag State and/or bring its centre of main interests into the European Union or any country with which a Facility Lender is prohibited from doing business and which has been notified to the Facility Agent.

12.1.14

ISM and ISPS Compliance

With effect from seven (7) days of the Drawdown Date, the Borrower shall comply in all material respects with the ISM Code and the ISPS Code or any replacements thereof and in particular (without prejudice to the generality of the foregoing) shall procure that the Manager holds (i) a valid and current DOC issued pursuant to the ISM Code and (ii) a valid and current SMC issued in respect of the Vessel pursuant to the ISM Code and the Borrower shall within seven (7) days of the Delivery Date and promptly, upon request by the Facility Agent (acting on the instructions of the Majority Facility Lenders or GIEK), supply the Facility Agent with copies of the same.

12.1.15

Necessary Authorisations

Without prejudice to any specific provision of the Facility Documents relating to an Authorisation, the Borrower shall (i) obtain, comply with and do all that is necessary to maintain in full force and effect all Necessary Authorisations if a failure to do the same may cause a Material Adverse Effect; and (ii) promptly upon request, supply certified copies to the Facility Agent of all Necessary Authorisations.

12.1.16

Compliance with Applicable Laws

The Borrower, and parties acting on its behalf, shall comply with (i) all material provisions of all applicable laws to which it may be subject (including, but not limited to, Environmental Laws, anti-bribery and corruption laws and anti-money laundering laws), (ii) Sections 276a to 276c of the Norwegian Criminal Code and (iii) the Equator Principles.

12.1.17

Performance of Obligations

The Borrower shall comply with the material provisions of all Project Documents in relation to the Vessel and in determining “material” the Facility Lenders will consider whether such non-compliance has a Material Adverse Effect.

12.1.18

Further Assurance

The Borrower shall, at its own expense, promptly take all such action as the Facility Agent may reasonably require for the purpose of perfecting or protecting any Facility Beneficiary’s rights with respect to the security created or evidenced (or intended to be created or evidenced) by the Facility Security Documents.

12.1.19

Other information

The Borrower will promptly supply to the Facility Agent at any time such information and explanations as the Majority Facility Lenders may from time to time reasonably require in connection with the operation of the Vessel and any reasonable financial information in connection with the Borrower, and will procure that the Facility Agent be given the like information and explanations relating to all other Security Parties.

12.1.20

Inspection of records

The Borrower will permit the inspection of its financial records and accounts following an Event of Default which is continuing unremedied or unwaived from time to time during business hours by the Facility Agent or its nominee.

12.1.21

Insurance

The Borrower shall ensure at its own expense throughout the Facility Security Period that the Vessel is insured and operated in accordance with the provisions set out in the relevant Facility Security Documents.

12.1.22

Change of Business

Except as expressly permitted in the Facility Documents the Borrower shall not carry on any business, other than that of owning, chartering and operating the Vessel.

12.1.23

No disposal of assets

The Borrower shall not dispose of any of its material assets other than a sale of the Vessel which complies with clause 6.2.

12.1.24

“Know your customer” checks

If:

(a)

the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation made after the date of this Agreement;

(b)

any change in the status of the Borrower after the date of this Agreement; or

(c)

a proposed assignment or transfer by a Facility Lender of any of its rights and obligations under this Agreement to a party that is not a Facility Lender prior to such assignment or transfer,

obliges the Facility Agent or any Facility Lender (or, in the case of (c) above, any prospective new Facility Lender) to comply with “know your customer” or similar identification procedures in circumstances where the necessary information is not already available to it, the Borrower shall promptly upon the request of the Facility Agent or any Facility Lender supply, or procure the supply of, such documentation and other evidence as is reasonably requested by the Facility Agent (for itself or on behalf of any Facility Lender) or any Facility Lender for itself (or, in the case of (c) above, on behalf of any prospective new Facility Lender) in order for the Facility Agent or that Facility Lender (or, in the case of (c) above, any prospective new Facility Lender) to carry out and be satisfied it has complied with all necessary “know your customer” or other similar checks under all applicable laws and regulations pursuant to the transactions contemplated in the Facility Documents.

12.1.25

Borrowings

Other than under this Agreement the Borrower may only borrow:

(a)

from members of the TOO Group on a subordinated basis; and

(b)

from other parties in the ordinary course of its business and in an aggregate amount of no more than ten million Dollars ($10,000,000),

provided always that no Event of Default has occurred and is continuing unremedied and unwaived.

12.1.26

Enforcement of Obligations

The Borrower shall take all reasonable steps to enforce its rights under the Bareboat Charter and any other agreements relating to the Vessel.

12.1.27

No dividends

The Borrower shall not pay dividends or make other distributions to shareholders:

(a)

whilst an Event of Default has occurred and is continuing unremedied or unwaived; or

(b)

following breach of any of the covenants contained in this clause 12 or in clause 8 of the Financial Guarantee.

12.1.28

No Merger

The Borrower shall not merge or consolidate with any other entity, split up or materially divest without the prior written consent of the Facility Agent (acting on the instructions of the Facility Lenders and GIEK).

12.1.29

No Material Amendment to Project Documents

With the exception of any non-material amendments or variations the Borrower shall not agree to any amendment, variation or termination of any of the Project Documents or Hedging Agreements to which it is a party without the prior written consent of the Majority Facility Lenders (such consent not to be unreasonably withheld).

12.1.30

Hedging

The Borrower shall not enter into an interest rate hedging programme to hedge part or all of the floating rate interest exposure under the Facility unless each Hedging Provider accedes to this Agreement and becomes a Hedging Provider for the purpose of the Facility Documents.

12.1.31

Ownership

The Borrower shall procure that its legal and beneficial ownership remains the same as advised to the Facility Agent on or about the date of this Agreement, other than permitted in accordance with the Facility Documents.

12.1.32

No Material Proceedings

The Borrower shall ensure that no litigation, arbitration or administrative proceeding on or before any court, arbitral body or agency against any member of the TOO Group has been started or is reasonably likely to be started which have or, if adversely determined, are reasonably likely to have a Material Adverse Effect or which is not covered by adequate insurance.

12.1.33

[Intentionally omitted]

12.1.34

GIEK requirements

The Borrower shall procure that no Security Party shall act (or omit to act) in a manner that is inconsistent with any requirement of GIEK under or in connection with the GIEK Guarantee and, in particular:

(a)

each Security Party shall do all that is reasonably necessary to ensure that all requirements of GIEK under or in connection with the GIEK Guarantee are complied with;

(b)

each Security Party will refrain from acting in any manner which could result in a breach of any requirements of GIEK under or in connection with the GIEK Guarantee or affect its validity; and

(c)

if documents and/or evidence are required by the GIEK Agent and/or GIEK Facility Lenders to make or substantiate a claim under the GIEK Guarantee, each Security Party shall provide such documents and/or evidence which are in its power to provide.

12.1.35

GIEK Guarantee protection

If at any time in the opinion of the GIEK Agent, any provision of a Facility Document contradicts or conflicts with any provision of the GIEK Guarantee, the Borrower will:

(a)

take all steps as the Facility Agent, the GIEK Agent and/or GIEK shall reasonably require to remove such contradiction or conflict; and

(b)

take all steps as the Facility Agent, the GIEK Agent and/or GIEK shall reasonably require to ensure that the GIEK Guarantee remains in full force and effect.

12.1.36

No Filing or Stamp Taxes

The Borrower shall procure that each Security Party does and shall undertake to carry out in respect of any Facility Document any filing, recording or enrollment under any court or other authority in its jurisdiction of incorporation or formation (including but not limited to (i) the relevant maritime registry, (ii) the Brazilian Certification and Registration Requirements and/or (iii) the registration of the relevant Finance Document at the competent Registry of Deeds and Documents (Cartório de Registro de Titulos e Documentos) in Brazil, to the extent applicable) and that any stamp, registration or similar tax will be paid on or in relation to any of the Facility Documents.

12.1.37

Valuation

(a)

From the Delivery Date, the Borrower shall supply to the Facility Agent as soon as the same become available but in any event within one hundred and eight (180) days after the end of each of its fiscal years, a Valuation in respect of the Vessel prepared at or around the end of its financial year;

(b)

If the Vessel is not operating under the Charter or any replacement charter approved by the Lenders, at the same time as delivering the Valuation, the Borrower shall deliver evidence that the Hull Cover Ratio is at least one hundred and twenty per cent. (120%);

(c)

If at any time after the Delivery Date, the Hull Cover Ratio is tested pursuant to this Agreement and there is a breach of the Hull Cover Ratio financial covenant calculated in accordance with this clause 12.1.37, then the Borrower may within ten (10) days of such testing date (i) prepay an amount of the Loan such that there is no longer a breach of the Hull Cover Ratio, and the Total Commitments shall be reduced accordingly, and/or (ii) provide additional Security Interests to the Facility Beneficiaries, either in the form of freely available cash or other Security Interests in a form satisfactory to the Majority Facility Lenders and GIEK (equal to the amount by which the Loan would need to be prepaid in order for there to be no breach of the Hull Cover Ratio) (the Cure). If the Borrower does not provide the Cure within such ten (10) day period, a breach of the clause 12.1.37(b) shall occur.

12.1.38

Additional Facility

In relation to the financing of Rig 2 and/or Rig 3, but always at the option of the TOO Group, the Borrower and/or any other member of the TOO Group agrees to:

(a)

enter into a Restatement (and the Facility Beneficiaries shall use reasonable endeavours to agree to the terms of a Restatement); or

(b)

if it is unable to agree on a Restatement and intends to enter into an Additional Facility, procure that it will not enter into such Additional Facility, unless each of the Security Parties, the Facility Beneficiaries and the parties to the Additional Facility have entered into an intercreditor agreement in form and substance satisfactory to the Facility Beneficiaries and GIEK, together with any amendments in relation to the Facility Documents and, in each case, based on the Additional Facility Principles, and without payment of additional fees (payable for the account of the Facility Beneficiaries and/or GIEK in respect of the Vessel and/or the Loan) by the Security Parties.

13	Events of Default

13.1	Events of Default

Each of the events or circumstances set out in this clause 13.1 is an Event of Default.

13.1.1

Failure to Pay

Any Security Party fails to pay any amount due from it under a Facility Document at the time, in the currency and otherwise in the manner specified herein provided that, if the relevant Security Party can demonstrate to the reasonable satisfaction of the Facility Agent that all necessary instructions were given to effect such payment and the non-receipt thereof is attributable solely to an error in the banking system, such payment shall instead be deemed to be due, solely for the purposes of this paragraph, within three (3) Banking Days of the date on which it actually fell due under the relevant Facility Document (if a payment of principal), five (5) Banking Days (if a payment of interest) or ten (10) Banking Days (if a sum payable on demand); or

13.1.2

Misrepresentation

Any representation or statement made by any Security Party in any Facility Document to which it is a party or in any notice or other document, certificate or statement delivered by it pursuant thereto or in connection therewith is or proves to have been incorrect or misleading in any material respect, where the circumstances causing the same give rise to a Material Adverse Effect; or

13.1.3

Specific Covenants

A Security Party fails duly to perform or comply with any of the obligations expressed to be assumed by or procured by the Borrower under clauses 12.1.3, 12.1.6, 12.1.10, 12.1.13, 12.1.16 (but only insofar as such failure relates to anti-bribery, sanctions and corruption laws); or

13.1.4

Financial Covenants

There is any breach of the financial covenants set out in clause 8.1 of the Financial Guarantee and/or 12.1.37(b) of this Agreement; or

13.1.5

Other Obligations

A Security Party fails duly to perform or comply with any of the obligations expressed to be assumed by it in any Facility Document (other than those referred to in clause 12.1.31, clause 13.1.3 (but only to the extent such failure constitutes an Event of Default under clause 13.1.3), clause 13.1.4 or clause 13.1.11) and such failure, where capable of remedy, is not remedied within 30 days of the earlier of (a) the Borrower becoming aware of such failure to perform or comply and (b) the Facility Agent informing the Borrower in writing of such failure to perform or comply; or

13.1.6

Cross Default

(a)

Any indebtedness of any Security Party is not paid when due (or within any applicable grace period); or

(b)

any indebtedness of any Security Party is declared to be or otherwise becomes due and payable prior to its specified maturity,

where (in either case) the aggregate of all such unpaid or accelerated indebtedness (i) of the Borrower or the Bareboat Charterer is equal to or greater than five million Dollars ($5,000,000) or its equivalent in any other currency; or (ii) of TOO or any of its Subsidiaries (other than the Borrower or the Bareboat Charterer) or the Shareholder is equal to or greater than one hundred million Dollars ($100,000,000) or its equivalent in any other currency; or

13.1.7

Insolvency and Rescheduling

A Security Party is unable to pay its debts as they fall due, commences negotiations (by reason of actual or anticipated financial difficulties) with any one or more of its creditors with a view to the general readjustment or rescheduling of its indebtedness or makes a general assignment for the benefit of its creditors or a composition with its creditors unless in respect of the Manager, if it has been replaced by another company in the TOO Group or another person acceptable to the Facility Agent (acting on the instructions of all Facility Lenders, acting reasonably) which has become party to a Management Agreement, in each case within six (6) months of insolvency; or

13.1.8

Winding-up

A Security Party takes any corporate action or other steps are taken or legal proceedings are started for its winding-up, dissolution, administration or re-organisation or for the appointment of a liquidator, receiver, administrator, administrative receiver, conservator, custodian, trustee or similar officer of it or of any or all of its revenues or assets or any moratorium is declared or sought in respect of any of its indebtedness unless the Facility Agent is satisfied, acting reasonably, that such actions, steps or proceedings are frivolous or vexatious and are being contested appropriately by the relevant Security Party; or

13.1.9

Execution or Distress

(a)

Any Security Party fails to comply with or pay any sum due from it (within 30 days of such amount falling due) under any final judgment or any final order made or given by any court or other official body of a competent jurisdiction, subject to the amount due being in an aggregate amount (i) for the Borrower or the Bareboat Charterer of equal to or greater than five million Dollars ($5,000,000) or its equivalent in any other currency; or (ii) for TOO or any of its Subsidiaries (other than the Borrower and the Bareboat Charterer) or the Shareholder, of equal to or greater than one hundred million Dollars ($100,000,000) or its equivalent in any other currency, being a judgment or order against which there is no right of appeal or if a right of appeal exists, where the time limit for making such appeal has expired.

(b)

Any execution or distress is levied against, or an encumbrancer takes possession of, the whole or any part of, the property, undertaking or assets of a Security Party, subject to the amount in question being in an aggregate amount (i) for the Borrower or the Bareboat Charterer, of equal to or greater than five million Dollars ($5,000,000) or its equivalent in any other currency; or (ii) for TOO or any of its Subsidiaries (other than the Borrower and the Bareboat Charterer) or the Shareholder, of equal to or greater than one hundred million Dollars ($100,000,000) or its equivalent in any other currency, other than any execution or distress which is being contested in good faith and which is either discharged within 30 days or in respect of which adequate security has been provided within 30 days to the relevant court or other authority to enable the relevant execution or distress to be lifted or released.

(c)

Notwithstanding the foregoing paragraphs of this clause 13.1.9, any levy of any distress on or any arrest, condemnation, confiscation, requisition for title or use, compulsory acquisition, seizure, detention or forfeiture of the Vessel (or any part thereof) or any exercise or purported exercise of any lien or claim on or against the Vessel where the release of or discharge of the lien or claim on or against the Vessel has not been procured within 30 days; or

13.1.10

Similar Event

Any event occurs which, under the laws of any jurisdiction, has a similar or analogous effect to any of those events mentioned in clauses 13.1.7, 13.1.8 and 13.1.9; or

13.1.11

Insurances

Insurance is not maintained in respect of the Vessel in accordance with the terms of the Facility Security Documents; or

13.1.12

Class

The Vessel has its classification withdrawn by the relevant Classification Society PROVIDED THAT if such withdrawal is (in the opinion of the Facility Agent acting on the instructions of the Majority Facility Lenders and GIEK in their absolute discretion) capable of remedy such Event of Default shall only occur if the Vessel’s classification is not reinstated to the satisfaction of the Facility Agent within twenty one (21) days; or

13.1.13

Environmental Matters

(a)

Any Environmental Claim is pending or made against the Borrower or the Bareboat Charterer or the Manager or any of their Environmental Affiliates or in connection with the Vessel, where such Environmental Claim has a Material Adverse Effect; or

(b)

Any actual Environmental Incident occurs in connection with the Vessel, where such Environmental Incident has a Material Adverse Effect; or

13.1.14

Repudiation

Any Security Party repudiates any Facility Document or Project Document to which it is a party or does or causes to be done any act or thing evidencing an intention to repudiate any such Facility Document or Project Document other than any repudiation to which clause 6.5 applies; or

13.1.15

Validity and Admissibility

At any time any act, condition or thing required to be done, fulfilled or performed in order:

(a)

to enable any Security Party lawfully to enter into, exercise its rights under and perform the respective obligations expressed to be assumed by it in the Facility Documents;

(b)

to ensure that the obligations expressed to be assumed by each of the Security Parties in the Facility Documents are legal, valid and binding; or

(c)

to make the Facility Documents admissible in evidence in any applicable jurisdiction,

is not done, fulfilled or performed within 30 days after notification from the Facility Agent to the relevant Security Party requiring the same to be done, fulfilled or performed; or

13.1.16

Material Adverse Change

At any time there shall occur a change in the business or operations of a Security Party or a change in the financial condition of any Security Party which, in the reasonable opinion of the Majority Facility Lenders, materially impairs such Security Party’s ability to discharge its obligations under the Facility Documents in the manner provided therein and such change, if capable of remedy, is not so remedied within 30 days of written notification from the Facility Agent; or

13.1.17

Qualifications of Financial Statements

The auditors of the TOO Group qualify their report on any audited consolidated financial statements of the TOO Group in any regard which, in the reasonable opinion of the Facility Agent, has a Material Adverse Effect; or

13.1.18

Conditions Subsequent

If any of the conditions set out in clause 3.4 is not satisfied within thirty (30) days (or such other time as may be specified in Schedule 2) of the Drawdown Date, or such other time period specified by the Facility Agent acting on the instructions of the Majority Facility Lenders; or

13.1.19

Revocation or Modification of consents etc.

If any Necessary Authorisation which is now or which at any time during the Facility Security Period becomes necessary to enable any of the Security Parties to comply with any of their obligations in or pursuant to any of the Facility Security Documents is revoked, withdrawn or withheld, or modified in a manner which the Facility Agent reasonably considers is, or may be, prejudicial to the interests of a Facility Beneficiary in a material manner, or if such Necessary Authorisation ceases to remain in full force and effect; or

13.1.20

Curtailment of Business

If the business of any of the Security Parties is wholly or materially curtailed by any intervention by or under authority of any government, or if all or a substantial part of the undertaking, property or assets of any of the Security Parties is seized, nationalised, expropriated or compulsorily acquired by or under authority of any government or any Security Party disposes or threatens to dispose of a substantial part of its business or assets; or

13.1.21

Reduction of Capital

If the Borrower reduces its committed or subscribed capital; or

13.1.22

Challenge to Registration

If the registration of the Vessel or the Mortgage becomes void or voidable or liable to cancellation or termination; or

13.1.23

War

If the country of registration of the Vessel becomes involved in war (whether or not declared) or civil war or is occupied by any other power and the Facility Agent reasonably considers that, as a result, the security conferred by the Facility Security Documents is materially prejudiced unless within thirty (30) days thereof the Vessel is re-registered in another Flag State subject to a first priority Mortgage and/or Deed of Covenants in form and substance satisfactory to the Facility Lenders and GIEK and confirmed by legal opinions from all relevant counsel, in each case is in form and substance reasonably satisfactory to the Facility Lenders and GIEK; or

13.1.24

Notice of Termination

If the Sponsor gives notice to the Facility Agent to determine or terminate its obligations under the Financial Guarantee; or

13.1.25

Termination or material breach

If:

(a)

any of the Project Documents is terminated or cancelled other than any termination or cancellation to which clause 6.5 applies; or

(b)

any of the Project Documents is breached by a Security Party in a manner that gives rise to a right to terminate such Project Document or treat it as repudiated by the Charterer or any of its Affiliates (or in the case of the Bareboat Charter only, the Borrower or the Bareboat Charterer) with the benefit of the cure rights and the grace periods set forth under the Project Documents,

Provided that in the case of the Bareboat Charter only, it is as a result of a voluntary reorganisation of the TOO Group or otherwise contemplated by, and in accordance with, this Agreement, an Event of Default shall not occur if (i) a replacement Bareboat Charter has been entered into, (ii) the Facility Agent (acting on the instructions of all the Facility Lenders and GIEK) is satisfied that replacement Facility Security Documents have been executed and the Facility Security Documents are in full force and effect at all times, and (iii) the Vessel remains in operation under the Charter.

13.1.26

Declared Company

Any Security Party is declared to be a declared company under the provisions of Part IX of the Companies Act (Chapter 50) of Singapore.

13.2	Acceleration

If an Event of Default is continuing unremedied or unwaived the Facility Agent may, and shall (at the request of the Majority Facility Lenders), by notice to the Borrower cancel any part of the Commitments not then advanced and:

13.2.1

declare that the Loan, together with accrued interest, and all other amounts accrued or outstanding under the Facility Documents are immediately due and payable, whereupon they shall become immediately due and payable; and/or

13.2.2

declare that the Loan, together with accrued interest, and all other amounts accrued or outstanding under the Facility Documents is payable on demand, whereupon they shall immediately become payable on demand by the Facility Agent; and/or

13.2.3

declare the Commitments terminated and reduced to zero; and/or

13.2.4

exercise all of its rights under the Facility Documents; and/or

13.2.5

instruct the Facility Security Trustee to enforce its rights and those of the Facility Beneficiaries under the Facility Security Documents.

14	Assignment and Sub-Participation

14.1	Facility Lenders’ rights

14.1.1

A Facility Lender may assign any of its rights under this Agreement or transfer by novation any of its rights and obligations under this Agreement:

(i)

to any other branch or Affiliate of that Facility Lender, to a Facility Lender and/or, in the case of a GIEK Facility Lender, to GIEK; or

(ii)

(subject to the prior written consent of the Borrower, such consent not to be unreasonably withheld and to be deemed to be given unless notice to the contrary is received within five (5) Banking Days of the request being given, but not to be required at any time after an Event of Default which is continuing unremedied or unwaived or if the assignment is in favour of a central bank or federal reserve and in the case of an assignment or transfer of a GIEK Facility Lender, only, subject to GIEK’s approval) to any other bank, financial institution or other entity,

PROVIDED ALWAYS that any assignment or transfer under this clause 14 shall not result in any increased costs to the Borrower at the date of and as a consequence of such assignment or transfer (other than in respect of assignments or transfers to GIEK to which this proviso shall not apply).

14.1.2

A Facility Lender may grant sub-participations in all or any part of its Commitment without the requirement for consent or to disclose any sub-participation to any Security Party, provided that in the case of any such sub-participation that Facility Lender shall at all times remain liable for the performance of its obligations under this Agreement.

14.2	Borrower’s co-operation

The Borrower will co-operate fully with a Facility Lender in connection with any assignment, transfer or sub-participation by that Facility Lender; will execute and procure the execution of such documents as that Facility Lender may reasonably require in that connection; and irrevocably authorises any Facility Beneficiary to disclose to any proposed assignee, transferee or sub-participant, their Affiliates and professional advisers (whether before or after any assignment, transfer or sub-participation and whether or not any assignment, transfer or sub-participation shall take place) all information relating to the Security Parties, the Loan, the Transaction Documents and the Vessel which any Facility Beneficiary may in its discretion consider necessary or desirable (subject to any duties of confidentiality applicable to the Facility Lenders generally). Additionally, (but subject to the same duties of confidentiality), any Facility Lender may disclose the size and term of the Facility and the names of each Security Party to any investor or potential investor in a securitisation (or similar transaction of broadly equivalent economic effect) of that Facility Lender’s rights and obligations under the Facility Documents.

14.3	Rights of assignee

Any assignee of a Facility Lender shall (unless limited by the express terms of the assignment) take the full benefit of every provision of the Facility Documents benefiting that Facility Lender PROVIDED THAT an assignment will only be effective on notification by the Facility Agent to that Facility Lender and the assignee that the Facility Agent is satisfied it has complied with all necessary “Know your customer” or other similar checks under all applicable laws and regulations in relation to the assignment to the assignee.

14.4

In addition to the other rights provided to the Facility Lenders under this clause 14, each Facility Lender may without consulting with or obtaining consent from the Borrower, at any time charge, assign or otherwise create security in or over (whether by way of collateral or otherwise) all or any of its rights under any Facility Document to secure obligations of that Facility Lender including, without limitation, any charge, assignment or other security to secure obligations to a federal reserve or central bank except that no such charge, assignment or security shall:

(i)

release a Facility Lender from any of its obligations under the Facility Documents or (other than upon enforcement by the beneficiary of such charge, assignment or security) substitute the beneficiary of the relevant charge, assignment or other security for the Facility Lender as a party to any of the Facility Documents; or

(ii)

require any payments to be made by the Borrower or grant to any person any more extensive rights than those required to be made or granted to the relevant Facility Lender under the Facility Documents.

14.5	Transfer Certificates

If a Facility Lender wishes to transfer any of its rights and obligations under or pursuant to this Agreement, it may do so by delivering to the Facility Agent and, if the Facility Lender is a GIEK Facility Lender, a copy to the GIEK Agent, a duly completed Transfer Certificate, in which event on the Transfer Date:

14.5.1

to the extent that that Facility Lender seeks to transfer its rights and obligations, the Borrower (on the one hand) and that Facility Lender (on the other) shall be released from all further obligations towards the other;

14.5.2

the Borrower (on the one hand) and the transferee (on the other) shall assume obligations towards the other identical to those released pursuant to clause 14.5.1; and

14.5.3

the Facility Agent, the GIEK Agent, each of the Facility Lenders, the other Facility Beneficiaries and the transferee shall have the same rights and obligations between themselves as they would have had if the transferee had been an original Party as a Facility Lender,

PROVIDED THAT the Facility Agent shall only be obliged to execute a Transfer Certificate once:

(a)

it is satisfied it has complied with all necessary “know your customer” or other similar checks under all applicable laws and regulations in relation to the transfer to the transferee;

(b)

the transferee has paid to the Facility Agent for its own account a transfer fee of three thousand Dollars; and

(c)

the amount transferred is not less than one million Dollars ($1,000,000) or, if the Commitment of the transferring Facility Lender is less than one million Dollars ($1,000,000) the amount of that Facility Lender’s Commitment.

The Facility Agent is hereby authorised to sign any Transfer Certificate and/or Accession Deed on behalf of each Facility Beneficiary and the Borrower and shall, as soon as reasonably practicable after it has executed a Transfer Certificate and/or Accession Deed, send to the Borrower a copy of that Transfer Certificate and/or Accession Deed.

14.6	Facility Documents

Unless otherwise expressly provided in any Facility Document or otherwise expressly agreed between a Facility Lender and any proposed transferee and notified by that Facility Lender to the Facility Agent on or before the relevant Transfer Date, there shall automatically be assigned to the transferee with any transfer of a Facility Lender’s rights and obligations under or pursuant to this Agreement the rights of that Facility Lender under or pursuant to the Facility Documents (other than this Agreement) which relate to the portion of that Facility Lender’s rights and obligations transferred by the relevant Transfer Certificate.

14.7	No assignment or transfer by the Borrower

The Borrower may not assign any of its rights or transfer any of its rights or obligations under the Facility Documents.

14.8	Transfer to GIEK

14.8.1

If a GIEK Facility Lender receives a payment from GIEK under the GIEK Guarantee in respect of its participation in the GIEK Loan, then, to the extent that it is required to do so by GIEK pursuant to the terms of the GIEK Guarantee (or otherwise), that GIEK Facility Lender shall, at the reasonable and documented cost of the Borrower and without the Borrower’s consent, transfer to GIEK a part of its participation in the GIEK Loan equal to the amount paid to it by GIEK (but the transfer shall not limit the rights of that GIEK Facility Lender to recover any remaining part of its participation in the GIEK Loan or of any other moneys owing to it), provided however that if GIEK makes any payment to the GIEK Facility Lenders under the GIEK Guarantee:

(a)

the obligations of the Security Parties and the Facility Beneficiaries (and of any of them) under this Agreement and each of the Facility Documents shall not be discharged nor affected in any way;

(b)

GIEK shall be subrogated to the respective rights of the GIEK Facility Lenders against the Security Parties and the Facility Beneficiaries; and

(c)

GIEK shall be entitled to the extent of such payment to exercise the respective rights of the GIEK Facility Lenders (whether present or future) against the Security Parties and the Facility Beneficiaries (and against any of them) pursuant to this Agreement and the Facility Documents or any relevant laws and/or regulations unless and until such payment and the interest accrued thereon are fully reimbursed to GIEK; and

(d)

with respect to the obligations of the Security Parties owed to the Facility Beneficiaries under the Facility Documents (or any of them), such obligations shall additionally be owed to GIEK by way of subrogation of the rights of the Facility Beneficiaries.

14.8.2

Each of the GIEK Facility Lenders agrees that as soon as GIEK pays in full all moneys due under the GIEK Guarantee then each of the relevant GIEK Facility Lenders shall promptly transfer to GIEK one hundred per cent. (100%) of their respective GIEK Facility Commitments and/or GIEK Loan whereupon GIEK shall, upon receipt by the Facility Agent of a duly completed Transfer Certificate, and modified to the extent agreed between the Facility Beneficiaries and GIEK for consistency with the terms and conditions of the GIEK Guarantee, be a transferee and as such shall be entitled to the rights and benefits of the GIEK Facility Lenders under the Facility Documents to the extent of its participation. Notwithstanding any provisions to the contrary in any Facility Document, the Borrower consents to such assignment and transfer.

14.8.3

The Borrower shall indemnify GIEK in respect of any reasonable and documented costs or expenses (including legal fees) suffered or incurred by GIEK in connection with the transfer referred to hereinabove or in connection with any review by GIEK of any Default or dispute between the Borrower and any of the Facility Beneficiaries occurring prior to the transfer referred to hereinabove.

15	The Facility Agent, the GIEK Agent, the Facility Security Trustee and the Facility Lenders

15.1	Appointment

15.1.1

(a) Each Facility Lender appoints the Facility Agent to act as its agent under and in connection with the Facility Documents, (b) each GIEK Facility Lender appoints the GIEK Agent to act as its agent in relation to the GIEK Guarantee, and (c) each Facility Lender, Hedging Provider, Mandated Lead Arranger, the Bookrunner, the GIEK Agent and the Facility Agent appoints the Facility Security Trustee to act as its facility security trustee for the purpose of the Facility Documents and generally for the purpose of taking in its name and on its behalf such steps and exercising such powers that are granted to or delegated to the Facility Security Trustee (or its successors and assigns in such capacity) thereunder or under this Agreement and those which would be the reasonable consequence thereof.

15.1.2

(a) Each Facility Lender authorises the Facility Agent, (b) each GIEK Facility Lender authorises the GIEK Agent, and (c) each Facility Lender, Hedging Provider, Mandated Lead Arranger, the Bookrunner, the GIEK Agent and the Facility Agent authorises the Facility Security Trustee, to perform the duties and exercise the rights, powers, authorities and discretions specifically given to the Facility Agent, the GIEK Agent or the Facility Security Trustee (as the case may be) under or in connection with the Facility Documents and in the case of the GIEK Agent, the GIEK Guarantee, together with any other incidental rights, powers, authorities and discretions.

15.1.3

Except where the context otherwise requires, references in this clause 15 to the Facility Agent shall mean the Facility Agent and the Facility Security Trustee individually and collectively.

15.2	Authority

(a) Each Facility Lender and Hedging Provider and, in the case of the Facility Security Trustee, the other Facility Beneficiaries irrevocably authorises the Facility Security Trustee (in the case of clause 15.2.1, 15.2.3 and 15.2.4) and the Facility Agent (in the case of clauses 15.2.2, 15.2.3 and 15.2.4), (b) each GIEK Facility Lender irrevocably authorises the GIEK Agent (in the case of clauses 15.2.2, 15.2.5 and 15.2.6), (in each case subject to clauses 15.4 and 15.18):

15.2.1

to execute any Facility Document (other than this Agreement and the Hedging Agreements) on its behalf;

15.2.2

to collect, receive, release or pay any money on its behalf in respect of the GIEK Agent only, in respect of administering payments from GIEK for the benefit of the GIEK Facility Lenders under the terms of the GIEK Guarantee;

15.2.3

acting on the instructions from time to time of the Majority Facility Lenders (save where the terms of any Facility Document expressly provide otherwise) to give or withhold any waivers, consents or approvals under or pursuant to any Facility Document and, in the case of the Facility Security Trustee, to act on the instructions of the Facility Agent on behalf of the Majority Facility Lenders in respect of the foregoing;

15.2.4

acting on the instructions from time to time of the Majority Facility Lenders (save where the terms of any Facility Document expressly provide otherwise) to exercise, or refrain from exercising, any rights, powers, authorities or discretions under or pursuant to any Facility Document and, in the case of the Facility Security Trustee, to act on the instructions of the Facility Agent on behalf of the Majority Facility Lenders in respect of the foregoing;

15.2.5

to consult with GIEK in relation to waivers, consents or approvals under or pursuant to the Facility Documents and to inform the GIEK Facility Lenders of the result of such consultation and if such waiver, consent or approval is:

(a)

a GIEK Decision, such GIEK Decision will be taken by the GIEK Agent (acting on the sole direction of GIEK) and the GIEK Facility Lenders shall not instruct the GIEK Agent or the Facility Agent otherwise;

(b)

not a GIEK Decision and does not require the approval of all Facility Lenders, such waiver, consent or approval will be taken by the GIEK Agent (acting on the direction of the Majority GIEK Facility Lenders provided GIEK also agrees to such waiver, consent or approval); and

(c)

not a GIEK Decision and requires the approval of all Facility Lenders, such waiver, consent or approval will be taken by the GIEK Agent (acting on the direction of all GIEK Facility Lenders and GIEK);

15.2.6

to provide all information required by GIEK to GIEK in a timely manner provided that the GIEK Agent has received it in its capacity as GIEK Agent.

(b) The Facility Agent shall have no duties or responsibilities as agent or as Facility Security Trustee, the GIEK Agent shall have no duties or responsibility as agent, in each case other than those expressly conferred on it by the Facility Documents and shall not be obliged to act on any instructions from the Facility Lenders or the Majority Facility Lenders or the GIEK Facility Lenders if to do so would, in the opinion of the Facility Agent or the GIEK Agent, be contrary to any provision of the Facility Documents, or to any law or in respect of the GIEK Agent only, any provision of the GIEK Guarantee, or would expose the Facility Agent or the GIEK Agent to any actual or potential liability to any third party.

15.3

Trust

The Facility Security Trustee agrees and declares, and each of the other Facility Beneficiaries acknowledges, that, subject to the terms and conditions of this clause 15.3, the Facility Security Trustee holds the Secured Property on trust for itself and the Facility Beneficiaries absolutely. Each of the other Facility Beneficiaries agrees that the obligations, rights and benefits vested in the Facility Security Trustee shall be performed and exercised in accordance with this clause 15.3. The Facility Security Trustee shall have the benefit of all of the provisions of this Agreement benefiting it in its capacity as Facility Security Trustee for the Facility Beneficiaries, and all the powers and discretions conferred on trustees by the Trustees ▇▇▇ ▇▇▇▇ and the Trustee ▇▇▇ ▇▇▇▇ (to the extent not inconsistent with this Agreement). Where there are any inconsistencies between the Trustee ▇▇▇ ▇▇▇▇ or the Trustee ▇▇▇ ▇▇▇▇ and the provisions of this Agreement, the provisions of this Agreement shall, to the extent allowed by law, prevail and, in the case of any inconsistency with the Trustee ▇▇▇ ▇▇▇▇, the provisions of this Agreement shall constitute a restriction or exclusion for the purposes of that Act. In addition:

15.3.1

the Facility Security Trustee and any attorney, agent or delegate of the Facility Security Trustee may indemnify itself or himself out of the Secured Property against all liabilities, costs, fees, damages, charges, losses and expenses sustained or incurred by it or him in relation to the taking or holding of any of the Secured Property or in connection with the exercise or purported exercise of the rights, trusts, powers and discretions vested in the Facility Security Trustee or any other such person by or pursuant to the Facility Documents or in respect of anything else done or omitted to be done in any way relating to the Facility Documents other than as a result of its gross negligence or wilful misconduct;

15.3.2

the other Facility Beneficiaries acknowledge that the Facility Security Trustee shall be under no obligation to insure any property nor to require any other person to insure any property and shall not be responsible for any loss which may be suffered by any person as a result of the lack or insufficiency of any insurance and shall not be liable for any theft thereof; and

15.3.3

the Facility Beneficiaries agree that the perpetuity period applicable to the trusts declared by this Agreement shall be the period of one hundred and twenty five years from the date of this Agreement.

15.4	Limitations on authority

15.4.1

Except with the prior written consent of all the Facility Lenders and in the case of the GIEK Facility Lenders, acting through the GIEK Agent and in the case of clause 15.4.1(h), GIEK, the Facility Agent shall not be entitled to:

(a)

release or vary any security or guarantee given for the Borrower’s obligations under this Agreement unless expressly contemplated by the Facility Documents; nor

(b)

waive the payment of any sum of money payable by any Security Party under the Facility Documents and/or waive the payment or reduce any sum of money payable to any Facility Beneficiaries under the Facility Documents; nor

(c)

change the meaning of the expressions Majority Facility Lenders, Commercial Facility Lenders, GIEK Facility Lenders, Facility Lenders, Margin, Default Rate, Sponsor or Charterer; nor

(d)

exercise, or refrain from exercising, any right, power, authority or discretion, or give or withhold any consent, the exercise or giving of which is, by the terms of this Agreement, expressly reserved to the Facility Lenders; nor

(e)

extend the due date for the payment of any sum of money payable by any Security Party under any Facility Document; nor

(f)

take or refrain from taking any step if the effect of such action or inaction may lead to the increase of the obligations of a Facility Lender under any Facility Document; nor

(g)

agree to change the currency in which any sum is payable under any Facility Document (other than in accordance with the terms of the relevant Facility Document); nor

(h)

agree to amend this clause 15.4, clause 10.3 or any clause that refers to a unanimous approval of all Facility Lenders and/or GIEK; nor

(i)

increase any Commitment.

15.4.2

An amendment or waiver which relates to the rights or obligations of the Facility Agent or the GIEK Agent (each in their capacity as such) may not be effected without the consent of the Facility Agent or the GIEK Agent, as the case may be.

15.4.3

Except with GIEK’s prior consent, the Facility Agent shall not be entitled to exercise or refrain from exercising any right, power, authority or discretion, or give or withhold any consent, the exercise or giving of which, by the terms of this Agreement, would require GIEK’s prior consent and any amendment or waiver which relates to any matter which, by the terms of any Facility Document, requires the prior consent of GIEK shall not be entered into or provided by the Facility Agent until GIEK has agreed to its terms.

15.4.4

Without limiting in any manner the rights of the Facility Lenders under the Facilities (other than the GIEK Facility), and subject and without prejudice to any amendments, consents or waivers as may be given, consented or agreed to by the Facility Agent which is contrary to or inconsistent with any vote exercised by the GIEK Facility Lenders (acting on the instructions of GIEK);

(a)

in case of any conflict between the Facility Documents and the GIEK Guarantee, the GIEK Guarantee shall, as between the GIEK Facility Lenders and GIEK, prevail, and to the extent of such conflict or inconsistency, none of the GIEK Facility Lenders or the GIEK Agent shall assert to GIEK, the terms of the relevant Facility Documents; and

(b)

nothing in this Agreement or any Facility Document shall permit or oblige any GIEK Facility Lender or the GIEK Agent to act (or omit to act) in a manner that is inconsistent with any requirement of GIEK under or in connection with the GIEK Guarantee.

15.5	Liability

None of the Facility Agent, the GIEK Agent nor any of their directors, officers, employees or agents shall be liable to the Facility Lenders, Facility Beneficiaries (in the case of the Facility Security Trustee) or GIEK for anything done or omitted to be done by the Facility Agent or, as the case may be, the GIEK Agent under or in connection with any of the Transaction Documents or, in the case of GIEK Agent, the GIEK Guarantee unless as a result of the Facility Agent’s or, as the case may be, the GIEK Agent’s gross negligence or wilful misconduct.

15.6	Acknowledgement

Each Facility Lender, Security Party and Facility Beneficiary acknowledges that:

15.6.1

it has not relied on any representation made by the Facility Agent, the GIEK Agent or any of the Facility Agent’s or the GIEK Agent’s directors, officers, employees or agents or by any other person acting or purporting to act on behalf of the Facility Agent or the GIEK Agent to induce it to enter into any Facility Document;

15.6.2

it has made and will continue to make without reliance on the Facility Agent or the GIEK Agent and based on such documents and other evidence as it considers appropriate, its own independent investigation of the financial condition and affairs of the Security Parties in connection with the making and continuation of the Loan;

15.6.3

it has made its own appraisal of the creditworthiness of the Security Parties;

15.6.4

neither the Facility Agent nor the GIEK Agent shall have any duty or responsibility at any time to provide it with any credit or other information relating to any Security Party or to do any know your customer checks unless that information is received by the Facility Agent or the GIEK Agent pursuant to the express terms of a Facility Document; and

15.6.5

neither the Facility Agent nor the GIEK Agent is responsible for any determination as to whether any information provided or to be provided to any Facility Lender, Security Party or Facility Beneficiary is non-public information the use of which may be regulated or prohibited by applicable law or regulation relating to insider dealing or otherwise.

Each Facility Lender, each Security Party and each Facility Beneficiary agrees that it will not assert nor seek to assert against any director, officer, employee or agent of the Facility Agent, the GIEK Agent or against any other person acting or purporting to act on behalf of the Facility Agent or the GIEK Agent any claim which it might have against them.

15.7	Limitations on responsibility

15.7.1

Neither the Facility Agent nor the GIEK Agent shall have any responsibility to any Security Party, GIEK or to any Facility Lender or Facility Beneficiary on account of:

(a)

the failure of a Facility Lender, GIEK or Facility Beneficiary or of any Security Party to perform any of its obligations under a Facility Document or the GIEK Guarantee; nor

(b)

the financial condition of any Security Party; nor

15.7.2

the completeness or accuracy of any statements, representations, information, communication or warranties made in or pursuant to or in connection with any Facility Document, the GIEK Guarantee or in or pursuant to or in connection with any document delivered pursuant to or in connection with any Facility Document or the GIEK Guarantee or the Facility Secured Property; nor

15.7.3

the negotiation, execution, effectiveness, genuineness, validity, enforceability, admissibility in evidence or sufficiency of any Facility Document, the Facility Secured Property or the GIEK Guarantee or of any document executed or delivered pursuant to or in connection with any Facility Document, the Facility Secured Property or the GIEK Guarantee, nor the priority of any of the Security Interests, the right or title of any person in or to any property comprised therein or the existence of any encumbrance affecting the same; nor

15.7.4

any damages, costs or losses to any person, any diminution in value, or any liability whatsoever arising as a result of taking or not taking any action under or in connection with any Facility Document or the Facility Secured Property, unless directly caused by its gross negligence or wilful default. For the avoidance of doubt and notwithstanding anything contained in the Facility Documents, the Facility Agent shall not in any event be liable for any indirect or consequential loss (including, without limitation, loss of profit, business or goodwill) regardless of whether it was informed of the likelihood of such loss and irrespective of whether any such claim is made for breach of contract, in tort or otherwise; nor

(a)

any act, event or circumstance not reasonably within its control; nor

(b)

the general risks of investment in, or the holding of assets in, any jurisdiction,

including (in each case and without limitation) such damages, costs, losses, diminution in value or liability arising as a result of: nationalisation, expropriation or other governmental actions; any regulation, currency restriction, devaluation or fluctuation; market conditions affecting the execution or settlement of transactions or the value of assets (including any Disruption Event); breakdown, failure or malfunction of any third party transport, telecommunications, computer services or systems; natural disasters or acts of God; war, terrorism, insurrection or revolution; or strikes or industrial action or, in the case of the Facility Security Trustee, any shortfall which arises on the enforcement or realisation of the Facility Secured Property.

15.7.5

The Facility Agent will not be liable for any delay (or any related consequences) in crediting an account with an amount required under the Facility Documents to be paid by the Facility Agent if the Facility Agent has taken all necessary steps as soon as reasonably practicable to comply with the regulations or operating procedures of any recognised clearing or settlement system used by the Facility Agent for that purpose.

15.7.6

The duties of the Facility Agent, the Facility Security Trustee and the GIEK Agent are of a mechanical and administrative nature.

15.8	The Facility Agent’s and the GIEK Agent’s rights

Each of the Facility Agent and the GIEK Agent may:

15.8.1

assume that all representations or warranties made or deemed repeated by any Security Party in or pursuant to any Facility Document are true and complete, unless, in its capacity as the Facility Agent or the GIEK Agent, it has acquired actual knowledge to the contrary;

15.8.2

assume that no Default has occurred unless, in its capacity as the Facility Agent or the GIEK Agent it has acquired actual knowledge to the contrary (or, in the case of the Facility Security Trustee, written notice);

15.8.3

rely on any document or notice believed by it to be genuine;

15.8.4

rely as to legal or other professional matters on opinions and statements of any legal or other professional advisers selected or approved by it whether or not addressed to it and whether or not it contains a limit on liability by reference to monetary cap or otherwise;

15.8.5

rely as to any factual matters which might reasonably be expected to be within the knowledge of any Security Party on a certificate signed by or on behalf of that Security Party;

15.8.6

refrain from exercising any right, power, discretion or remedy unless and until instructed to exercise that right, power, discretion or remedy and as to the manner of its exercise by the Facility Lenders (or, where applicable, by the Majority Facility Lenders) and unless and until the Facility Agent has received from the Facility Lenders or the GIEK Agent has received from the GIEK Facility Lenders any payment which the Facility Agent, or, as the case may be, the GIEK Agent may require on account of, or any security which the Facility Agent or as the case may be, the GIEK Agent may require for, any costs, claims, expenses (including legal and other professional fees) and liabilities which it considers it may incur or sustain in complying with those instructions; and

15.8.7

refrain from doing anything which in the Facility Agent’s opinion will or may be contrary to any relevant law, directive or regulation of any jurisdiction and the Facility Agent may do anything which is, in its opinion, necessary to comply with any such law, directive or regulation. The Facility Agent shall be entitled to seek out and rely upon the advice of any legal advisers or other experts in order to determine whether any instruction received by it may conflict with any relevant law, directive or regulation of any jurisdiction.

15.9	The Facility Agent’s duties

The Facility Agent (but not the Facility Security Trustee) shall:

15.9.1

if requested in writing to do so by a Facility Lender, make enquiry and advise the Facility Lenders as to the performance or observance of any of the provisions of any Facility Document by any Security Party or as to the existence of an Event of Default; and

15.9.2

inform the Facility Lenders promptly of any Event of Default of which the Facility Agent has actual knowledge.

15.10

No deemed knowledge

Neither the Facility Agent nor the GIEK Agent shall be deemed to have actual knowledge of the falsehood or incompleteness of any representation or warranty made or deemed repeated by any Security Party or actual knowledge of the occurrence of any Default unless a Facility Lender or a Security Party shall have given written notice thereof to the Facility Agent in its capacity as the Facility Agent or the GIEK Agent in its capacity as GIEK Agent. Any information acquired by the Facility Agent or the GIEK Agent other than specifically in its capacity as the Facility Agent or the GIEK Agent shall not be deemed to be information acquired by the Facility Agent in its capacity as the Facility Agent or the GIEK Agent in its capacity as GIEK Agent.

The Facility Agent and the GIEK Agent may disclose to any other party and/or GIEK any information it reasonably believes it has received as agent under this Agreement.

Neither the Facility Agent nor the GIEK Agent is authorised to act on behalf of a Facility Lender (without first obtaining that Facility Lender’s consent) in any legal or arbitration proceedings relating to any Facility Document.

In acting as agent for the Facility Beneficiaries and GIEK, the Facility Agent and GIEK Agent shall be regarded as acting through its agency division which shall be treated as a separate entity from any other of its divisions or departments.

15.11

Other business

The Facility Agent and/or the GIEK Agent may, without any liability to account to the Facility Lenders or the Facility Beneficiaries (in the case of the Facility Security Trustee), generally engage in any kind of banking or trust business with a Security Party or with a Security Party’s subsidiaries or associated companies or with a Facility Lender or the Facility Beneficiaries (in the case of the Facility Security Trustee) as if it were not the Facility Agent or, as the case may be, the GIEK Agent.

The execution by the Facility Agent and the GIEK Agent of the Facility Documents constitutes, and the exercise of its rights and performance of its obligations thereunder will constitute, private and commercial activities done and performed for private and commercial purposes (rather than public and government purposes).

15.12

Indemnity

The Facility Lenders shall, promptly on the Facility Agent’s request, reimburse the Facility Agent in their respective Proportionate Shares, for, and keep the Facility Agent fully indemnified in respect of all liabilities, damages, costs, actions, demands and expenses and claims sustained or incurred by the Facility Agent in connection with the Facility Documents, or the performance of its duties and obligations, or the exercise of its rights, powers, discretions or remedies under or pursuant to any Facility Document, to the extent not paid by the Security Parties and not arising solely from the Facility Agent’s gross negligence or wilful misconduct.

The GIEK Facility Lenders shall, promptly on the GIEK Agent’s request, reimburse the GIEK Agent in their respective GIEK Proportionate Shares, for, and keep the GIEK Agent fully indemnified in respect of all liabilities, damages, costs and claims sustained or incurred by the GIEK Agent in connection with the GIEK Guarantee, or the performance of its duties and obligations, or the exercise of its rights, powers, discretions or remedies under or pursuant to any Facility Document or the GIEK Guarantee, to the extent not paid by the Security Parties and not arising solely from the GIEK Agent’s gross negligence or wilful misconduct.

This indemnity shall survive the termination of this Agreement.

This clause 15.12 may not be amended without the consent of the Facility Agent or, as the case may be, the GIEK Agent.

15.13

Employment of agents

In performing its duties and exercising its rights, powers, discretions and remedies under or pursuant to the Facility Documents, the Facility Agent shall be entitled to employ and pay agents to do anything which the Facility Agent is empowered to do under or pursuant to the Facility Documents (including the receipt of money and documents and the payment of money) and to act or refrain from taking action in reliance on the opinion of, or advice or information obtained from, any lawyer, banker, broker, accountant, valuer or any other person believed by the Facility Agent in good faith to be competent to give such opinion, advice or information and whether or not such opinion, advice or information contains a limit on liability by reference to monetary cap or otherwise if the Facility Agent uses reasonable care in the selection of such agent, it shall have no responsibility for supervising such agent or be responsible for any act or omission thereof.

Without prejudice to the generality of any other provision of this Agreement or any other Facility Security Document, the entry into possession of the Secured Property shall not render the Facility Security Trustee or any Receiver liable to account as mortgagee in possession thereunder (or its equivalent in any other applicable jurisdiction) or take any action which would expose it to any liability in respect of Environmental Claims in respect of which it has not been indemnified and/or secured and/or pre-funded to its satisfaction or to be liable for any loss on realisation or for any default or omission on realisation or for any default or omission for which a mortgagee in possession might be liable unless such loss, default or omission is caused by its own gross negligence or wilful default.

The Facility Security Trustee shall not be bound to take any steps to ascertain whether any event, condition or act, the happening of which would cause a right or remedy to become exercisable by the Facility Security Trustee or any agent under this Agreement or the other Facility Documents has happened or to monitor or supervise the observance and performance by the Security Parties, any agent or any of the other parties thereto of their respective obligations thereunder and, until it shall have actual knowledge or express notice to the contrary, the Facility Security Trustee shall be entitled to assume that no such event, condition or act has happened and that the Security Parties, the agents and the other parties thereto are observing and performing all their respective obligations thereunder.

15.14

Distribution of payments

The Facility Agent but not the Facility Security Trustee who shall be entitled to pay any amounts due to the Facility Lenders to the Facility Agent for onward distribution to such Facility Lenders shall pay promptly to the order of each Facility Lender that Facility Lender’s Proportionate Share of every sum of money received by the Facility Agent pursuant to the Facility Documents (with the exception of any amounts payable pursuant to clause 9 and/or any Fee Letter and any amounts which, by the terms of the Facility Documents, are paid to the Facility Agent for the account of the Facility Agent alone or specifically for the account of one or more Facility Lenders) and until so paid such amount shall be held by the Facility Agent to the order of that Facility Lender.

Upon receipt of any amount from GIEK by the GIEK Agent, the GIEK Agent shall promptly pay to the order of each GIEK Facility Lender that GIEK Facility Lender’s GIEK Proportionate Share of such amount and until so paid such amount shall be held by the GIEK Agent on trust absolutely for that GIEK Facility Lender.

15.15

Reimbursement

Neither the Facility Agent nor the GIEK Agent shall have any liability to pay any sum to a Facility Lender, Facility Beneficiary or, as the case may be, GIEK Facility Lender until it has itself received payment of that sum. If, however, the Facility Agent does pay any sum to a Facility Lender on account of any amount prospectively due to that Facility Lender, a Facility Beneficiary or the Facility Agent on behalf of the Facility Lenders, as applicable pursuant to clause 15.14 before it has itself received payment of that amount, and the Facility Agent does not in fact receive payment within five (5) Banking Days after the date on which that payment was required to be made by the terms of the Facility Documents, that Facility Lender or Facility Beneficiary will, on demand by the Facility Agent, refund to the Facility Agent an amount equal to the amount received by it, together with an amount sufficient to reimburse the Facility Agent for any amount which the Facility Agent may certify that it has been required to pay by way of interest on money borrowed to fund the amount in question during the period beginning on the date on which that amount was required to be paid by the terms of the Facility Documents and ending on the date on which the Facility Agent receives reimbursement.

15.16

Redistribution of payments

Unless otherwise agreed between the Facility Lenders and the Facility Agent, if at any time a Facility Lender receives or recovers by way of set-off, the exercise of any lien or otherwise from any Security Party, an amount greater than that Facility Lender’s Proportionate Share of any sum due from that Security Party to the Facility Lenders under the Facility Documents (the amount of the excess being referred to in this clause 15.16 and in clause 15.17 as the Excess Amount) then:

15.16.1

that Facility Lender shall within three (3) Banking Days notify the Facility Agent (which shall promptly notify each other Facility Lender);

15.16.2

that Facility Lender shall pay to the Facility Agent an amount equal to the Excess Amount within ten (10) days of its receipt or recovery of the Excess Amount; and

15.16.3

the Facility Agent shall treat that payment as if it were a payment by the Security Party in question on account of the sum due from that Security Party to the Facility Lenders and shall account to the Facility Lenders in respect of the Excess Amount in accordance with the provisions of this clause 15.16.

However, if a Facility Lender has commenced any legal proceedings to recover sums owing to it under the Facility Documents and, as a result of, or in connection with, those proceedings has received an Excess Amount, the Facility Agent shall not distribute any of that Excess Amount to any other Facility Lender which had been notified of the proceedings and had the legal right to, but did not, join those proceedings or commence and diligently prosecute separate proceedings to enforce its rights in the same or another court.

15.17

Rescission of Excess Amount

If all or any part of any Excess Amount is rescinded or must otherwise be restored to any Security Party or to any other third party, the Facility Lenders which have received any part of that Excess Amount by way of distribution from the Facility Agent pursuant to clause 15.16 shall repay to the Facility Agent for the account of the Facility Lender which originally received or recovered the Excess Amount, the amount which shall be necessary to ensure that the Facility Lenders share rateably in accordance with their Proportionate Shares in the amount of the receipt or payment retained, together with interest on that amount at a rate equivalent to that (if any) paid by the Facility Lender receiving or recovering the Excess Amount to the person to whom that Facility Lender is liable to make payment in respect of such amount, and clause 15.16.3 shall apply only to the retained amount.

15.18

Instructions

Where the Facility Agent is authorised or directed to act or refrain from acting in accordance with the instructions of the Facility Lenders, GIEK or of the Majority Facility Lenders each of the Facility Lenders and GIEK (if applicable) shall provide the Facility Agent with instructions within seven (7) Banking Days of the Facility Agent’s request (which request may be made orally or in writing). If a Facility Lender and GIEK (if applicable) does not provide the Facility Agent with instructions within that period, that Facility Lender and GIEK (if applicable) shall be bound by the decision of the Facility Agent. Nothing in this clause 15.18 shall limit the right of the Facility Agent to take, or refrain from taking, any action without obtaining the instructions of the Facility Lenders, GIEK or the Majority Facility Lenders if the Facility Agent in its discretion considers it necessary or appropriate to take, or refrain from taking, such action in order to preserve the rights of the Facility Lenders and GIEK (if applicable) under or in connection with the Facility Documents. In that event, the Facility Agent will notify the Facility Lenders and GIEK (if applicable) of the action taken by it as soon as reasonably practicable, and the Facility Lenders and GIEK (if applicable) agree to ratify any action taken by the Facility Agent pursuant to this clause 15.18.

For the purposes of this clause, the Facility Security Trustee shall be entitled to rely on any instruction from the Facility Agent on behalf of the relevant Facility Lenders and it will not be liable for acting or refraining from acting in the absence of such instructions.

15.19

Payments

All amounts payable to a Facility Lender and/or GIEK under this clause 15, clause 9.5 and clause 9.1.2 shall be paid to such account at such bank as that Facility Lender, or in the case of GIEK, the GIEK Agent or GIEK may from time to time direct in writing to the Facility Agent or, as the case may be, the GIEK Agent.

If any party owes an amount to the Facility Agent under the Facility Documents the Facility Agent may, after giving notice to that party, deduct an amount not exceeding that amount from any payment to that party which the Facility Agent would otherwise be obliged to make under the Facility Documents and apply the amount deducted in or towards satisfaction of the amount owed. For the purposes of the Facility Documents that party shall be regarded as having received any amount so deducted.

15.20

“Know your customer” checks

Each Facility Lender shall promptly upon the request of the Facility Agent or, as the case may be, the GIEK Agent supply, or procure the supply of, such documentation and other evidence as is reasonably requested by the Facility Agent or, as the case may be, the GIEK Agent (for itself), in order for the Facility Agent or, as the case may be, the GIEK Agent to carry out and be satisfied it has complied with all necessary “know your customer” or other similar checks under all applicable laws and regulations pursuant to the transactions contemplated in the Facility Documents.

15.21

Resignation

Subject to a successor being appointed in accordance with this clause 15.21, the Facility Agent or the GIEK Agent may (and in the case of the Facility Agent if requested by the Majority Facility Lenders and in the case of the GIEK Agent if requested by all of the GIEK Facility Lenders, will), resign as agent and/or the Facility Security Trustee may (and if requested by the Majority Facility Lenders will), resign as Facility Security Trustee at any time without assigning any reason by giving to the Borrower and the Facility Lenders notice of its intention to do so, in which event the following shall apply:

15.21.1

with the consent of the Borrower not to be unreasonably withheld (but such consent not to be required at any time after an Event of Default which is continuing unremedied or unwaived) the Facility Lenders may within thirty (30) days after the date of the notice from the Facility Agent, the GIEK Agent or the Facility Security Trustee (as the case may be) appoint a successor to act as agent and/or Facility Security Trustee or, if they fail to do so with the consent of the Borrower, not to be unreasonably withheld (but such consent not to be required at any time after an Event of Default which is continuing unremedied or unwaived), the Facility Agent, the GIEK Agent or the Facility Security Trustee (as the case may be) may appoint any other bank or financial institution as its successor;

15.21.2

the resignation of the Facility Agent, the GIEK Agent or the Facility Security Trustee (as the case may be) shall take effect simultaneously with the appointment of its successor on written notice of that appointment being given to the Borrower and the Facility Lenders;

15.21.3

the Facility Agent, the GIEK Agent or the Facility Security Trustee (as the case may be) shall thereupon be discharged from all further obligations as agent and/or Facility Security Trustee but shall remain entitled to the benefit of the provisions of this clause 15; and

15.21.4

the successor of the Facility Agent, the GIEK Agent or the Facility Security Trustee (as the case may be) and each of the other parties to this Agreement shall have the same rights and obligations amongst themselves as they would have had if that successor had been a Party.

15.22

Replacement of the Facility Agent for FATCA withholding

15.22.1

The Facility Agent shall resign in accordance with clause 15.21 above (and, to the extent applicable, shall use reasonable endeavours to appoint a successor facility agent pursuant to clause 15.21 above) if on or after the date which is three (3) months before the earliest FATCA Application Date relating to any payment to the Facility Agent under the Facility Documents, either:

(a)

the Facility Agent fails to respond to a request under clause 15.24 and a Facility Lender reasonably believes that the Facility Agent will not be (or will have ceased to be) a FATCA Exempt Party on or after that FATCA Application Date;

(b)

the information supplied by the Facility Agent pursuant to clause 15.24 indicates that the Facility Agent will not be (or will have ceased to be) a FATCA Exempt Party on or after that FATCA Application Date; or

(c)

the Facility Agent notifies the Borrower and the Facility Lenders that the Facility Agent will not be (or will have ceased to be) a FATCA Exempt Party on or after that FATCA Application Date;

and (in each case) a Facility Lender reasonably believes that a Party will be required to make a FATCA Deduction that would not be required if the Facility Agent were a FATCA Exempt Party, and that Facility Lender, by notice to the Facility Agent, requires it to resign.

15.23

No fiduciary relationship

Neither the Facility Agent nor the GIEK Agent shall not have any fiduciary relationship with or be deemed to be a trustee of or for any other person and nothing contained in any Facility Document, or, as the case may be, the GIEK Guarantee shall constitute a partnership between any two or more Facility Lenders or between the Facility Agent, the GIEK Agent and any other person.

15.24

FATCA Information

(a)

Subject to clause 15.24(c) below, each Party shall, within ten (10) Banking Days of a reasonable request by another Party:

(i)

confirm to that other Party whether it is:

(A)

a FATCA Exempt Party; or

(B)

not a FATCA Exempt Party; and

(ii)

supply to that other Party such forms, documentation and other information relating to its status under FATCA (including its applicable “passthru payment percentage” or other information required under the US Treasury Regulations or other official guidance including intergovernmental agreements) as that other Party reasonably requests for the purposes of that other Party’s compliance with FATCA, provided however that such forms, documentation and other information may be given in accordance with law and other relevant obligations.

(b)

If a Party confirms to another Party pursuant to clause 15.24(a)(i) above that it is a FATCA Exempt Party and it subsequently becomes aware that it is not, or has ceased to be a FATCA Exempt Party, that Party shall notify that other Party reasonably promptly.

(c)

Clause 15.24(a) above shall not oblige any Facility Beneficiary to do anything which would or might in its reasonable opinion constitute a breach of:

(i)

any law or regulation;

(ii)

any fiduciary duty; or

(iii)

any policy of that Facility Beneficiary;

(iv)

any duty of confidentiality.

(d)

If a Party fails to confirm its status or to supply forms, documentation or other information requested in accordance with clause 15.24(a) above (including, for the avoidance of doubt, where clause 15.24(c) above applies), then:

(i)

if that Party failed to confirm whether it is (and/or remains) a FATCA Exempt Party then such Party shall be treated for the purposes of the Facility Documents as if it is not a FATCA Exempt Party; and

(ii)

if that Party failed to confirm its applicable “passthru payment percentage” then such Party shall be treated for the purposes of the Facility Documents (and payments made thereunder) as if its applicable “passthru payment percentage” is 100%,

until (in each case) such time as the Party in question provides the requested confirmation, forms, documentation or other information.

15.25

GIEK Guarantee

Each GIEK Facility Lender represents and warrants to the GIEK Agent that, with effect from the date it receives the GIEK Guarantee, (i) it has reviewed the GIEK Guarantee and is aware of the provisions thereof, (ii) any representations and warranties made by the GIEK Agent on behalf of each GIEK Facility Lender under the GIEK Guarantee are true and correct with respect to such GIEK Facility Lender in all respects, and (iii) no information provided by such GIEK Facility Lender in writing to the GIEK Agent or to GIEK prior to the date hereof was incomplete, untrue or incorrect in any respect except to the extent that such GIEK Facility Lender, in the exercise of reasonable care and due diligence prior to the giving of the information, could not have discovered the error or omission. Each GIEK Facility Lender represents and warrants to the GIEK Agent that it has not taken (or failed to take), and agrees with the GIEK Agent that it shall not take (or fail to take), any action that would result in the GIEK Agent being in breach of any of its obligations in its capacity as GIEK Agent under the GIEK Guarantee or the Facility Documents, or result in any of GIEK Facility Lenders being in breach of any of their respective obligations as insured parties, under the GIEK Guarantee, or which would otherwise prejudice the GIEK Agent’s ability to make a claim on behalf of the GIEK Facility Lenders under the GIEK Guarantee.

15.26

GIEK Agent actions

The GIEK Agent agrees to take such actions under the GIEK Guarantee (including with respect to any amendment, modification or supplement to the GIEK Guarantee) as may be directed on the instructions of the Majority GIEK Facility Lenders from time to time; provided that, anything herein or in the GIEK Guarantee to the contrary notwithstanding, the GIEK Agent shall not be obliged to take any such action or to expend or risk its own funds or otherwise incur any liability in the performance of any of its duties or the exercise of any of its rights or powers hereunder or thereunder if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it or if such action would be contrary to applicable law.

15.27

Additional trustees

The Facility Security Trustee shall have power by notice in writing to the other Facility Beneficiaries and the Borrower to appoint any person either to act as separate trustee or as co-trustee jointly with the Facility Security Trustee:

15.27.1

if the Facility Security Trustee reasonably considers such appointment to be in the best interests of the Facility Beneficiaries;

15.27.2

for the purpose of conforming with any legal requirement, restriction or condition in any jurisdiction in which any particular act is to be performed; or

15.27.3

for the purpose of obtaining a judgment in any jurisdiction or the enforcement in any jurisdiction against any person of a judgment already obtained,

and any person so appointed shall (subject to the provisions of this Agreement) have such rights, powers, duties and obligations as shall be conferred or imposed by the instrument of appointment. The Facility Security Trustee shall have power to remove any person so appointed. At the request of the Facility Security Trustee, the other parties to this Agreement (and the Borrower shall procure that the Security Parties) shall forthwith execute all such documents and do all such things as may be required to perfect such appointment or removal and each such party irrevocably authorises the Facility Security Trustee in its name and on its behalf to do the same. Such a person shall accede to this Agreement as a Facility Security Trustee to the extent necessary to carry out their role on terms satisfactory to the Facility Security Trustee and (subject always to the provisions of this Agreement) have such trusts, powers, authorities, liabilities and discretions (not exceeding those conferred on the Facility Security Trustee by this Agreement and the other Facility Documents) and such duties and obligations as shall be conferred or imposed by the instrument of appointment (being no less onerous than would have applied to the Facility Security Trustee but for the appointment). The Facility Security Trustee shall not be bound to supervise, or be responsible for any loss incurred by reason of any act or omission of, any such person if the Facility Security Trustee shall have exercised reasonable care in the selection of such person.

15.28

Custodians and nominees

The Facility Security Trustee may (to the extent legally permitted) appoint and pay any person to act as a custodian, nominee or delegate on any terms in relation to any assets of the trust as the Facility Security Trustee may determine (including the power to sub-delegate) including for the purpose of depositing with a custodian this Agreement or any document relating to the trust created under this Agreement and the Facility Security Trustee shall not be responsible for any loss, liability, expense, demand, cost, claim or proceedings incurred by reason of the misconduct, omission or default on the part of any person appointed by it under this Agreement or be bound to supervise the proceedings or acts of any person.

15.29

Acceptance of title

The Facility Security Trustee shall be entitled to accept without enquiry, and shall not be obliged to investigate, any right and title that any of the Security Parties have to any of the Secured Property and shall not be liable for or bound to require any Security Party to remedy any defect in its right or title.

15.30

Refrain from illegality

Notwithstanding anything to the contrary expressed or implied in the Transaction Documents, the Facility Security Trustee may refrain without liability from doing anything which in its opinion will or may be contrary to any relevant law, directive or regulation of any applicable jurisdiction (including, but not limited to, the laws of England, the United States of America or any jurisdiction forming part of it) or any directive, law or regulation of any agency of such state or jurisdiction and the Facility Security Trustee may do anything which is, in its opinion, necessary to comply with any such law, directive or regulation.

15.31

Insurance by Facility Security Trustee

Where the Facility Security Trustee is named on any insurance policy (including the Insurances) as an insured party and/or loss payee, the Facility Security Trustee shall not be responsible for any loss which may be suffered by reason of, directly or indirectly, its failure to notify the insurers of any material fact relating to the risk assumed by such insurers or any other information of any kind.

15.32

No additional Security Interests

Each Facility Lender agrees it will not obtain the benefit of any Security Interests securing any Facility Secured Obligations and not receive the benefit of any guarantee or indemnity of the Facility Secured Obligations except to the extent they are created by or arise under the Facility Documents or with the consent of the Majority Facility Lenders and GIEK.

16	Set-Off

Only a Facility Beneficiary (not the Borrower) may set off any matured obligation due from the Borrower under any Facility Document (to the extent beneficially owned by that Facility Beneficiary) against any matured obligation owed by that Facility Beneficiary to the Borrower, regardless of the place of payment, booking branch or currency of either obligation. If the obligations are in different currencies, that Facility Beneficiary may convert either obligation at a market rate of exchange in its usual course of business for the purpose of the set-off.

17	Payments

17.1	Payments

Each amount payable by the Borrower under a Facility Document shall be paid to such account at such bank as the Facility Agent may from time to time direct to the Borrower in the Currency of Account and in such funds as are customary at the time for settlement of transactions in the relevant currency in the place of payment. Payment shall be deemed to have been received by the Facility Agent on the date on which the Facility Agent receives authenticated advice of receipt, unless that advice is received by the Facility Agent on a day other than a Banking Day or at a time of day (whether on a Banking Day or not) when the Facility Agent in its reasonable discretion considers that it is impossible or impracticable for the Facility Agent to utilise the amount received for value that same day, in which event the payment in question shall be deemed to have been received by the Facility Agent on the next Banking Day following the date of receipt of advice by the Facility Agent.

17.2	No deductions or withholdings

Each payment (whether of principal or interest or otherwise) to be made by the Borrower under a Facility Document shall, subject only to clause 17.3, be made free and clear of and without deduction for or on account of any Taxes or other deductions, withholdings, restrictions, conditions or counterclaims of any nature other than FATCA Deductions.

17.3	Grossing-up

With the exception of a FATCA Deduction, if at any time any law requires (or is interpreted to require) the Borrower to make any deduction or withholding from any payment, or to change the rate or manner in which any required deduction or withholding is made, the Borrower will promptly notify the Facility Agent and, simultaneously with making that payment, will pay to the Facility Agent whatever additional amount (after taking into account any additional Taxes on, or deductions or withholdings from, or restrictions or conditions on, that additional amount) is necessary to ensure that, after making the deduction or withholding, the relevant Facility Beneficiaries receive a net sum equal to the sum which they would have received had no deduction or withholding been made.

17.4	Evidence of deductions

If at any time the Borrower is required by law to make any deduction or withholding from any payment to be made by it under a Facility Document, the Borrower will pay the amount required to be deducted or withheld to the relevant authority within the time allowed under the applicable law and will, no later than thirty (30) days after making that payment, deliver to the Facility Agent an original receipt issued by the relevant authority, or other evidence reasonably acceptable to the Facility Agent, evidencing the payment to that authority of all amounts required to be deducted or withheld.

17.5	Rebate

If the Borrower pays any additional amount under clause 17.3 and a Facility Beneficiary subsequently receives a refund or allowance from any tax authority which that Facility Beneficiary identifies as being referable to that increased amount so paid by the Borrower, that Facility Beneficiary shall, as soon as reasonably practicable, pay to the Borrower an amount equal to the amount of the refund or allowance received, if and to the extent that it may do so without prejudicing its right to retain that refund or allowance and without putting itself in any worse financial position than that in which it would have been had the relevant deduction or withholding not been required to have been made. Nothing in this clause 17.5 shall be interpreted as imposing any obligation on any Facility Beneficiary to apply for any refund or allowance nor as restricting in any way the manner in which any Facility Beneficiary organises its tax affairs, nor as imposing on any Facility Beneficiary any obligation to disclose to the Borrower any information regarding its tax affairs or tax computations.

17.6	Adjustment of due dates

If any payment or transfer of funds to be made under a Facility Document, other than a payment of interest on the Loan, shall be due on a day which is not a Banking Day, that payment shall be made on the next succeeding Banking Day (unless the next succeeding Banking Day falls in the next calendar month in which event the payment shall be made on the next preceding Banking Day). Any such variation of time shall be taken into account in computing any interest in respect of that payment.

17.7	[Intentionally omitted]

17.8	Hedging Providers

Each Hedging Provider agrees with and covenants to each of the other Facility Beneficiaries that until the end of the Facility Security Period and without prejudice to any rights which that Hedging Provider may otherwise have against the Borrower (including, for the avoidance of doubt, any right to terminate transactions under its Hedging Agreement or close-out its Hedging Agreement pursuant to a permitted termination event set out therein but subject to any other agreements or covenants of the Hedging Providers set out in any other provision of this Agreement):

17.8.1

it will not, without the prior written consent of the Facility Agent:

(a)

at any time when an Event of Default has occurred and is continuing unremedied and unwaived, accept or demand from the Borrower the payment or repayment in whole or in part of any Indebtedness whatsoever now or hereafter due to it from the Borrower;

(b)

at any time when an Event of Default has occurred and is continuing unremedied and unwaived, otherwise accept, have the benefit of, or share in any payment from, or composition with, the Borrower (other than pursuant to any contractual set-off and/or netting provisions contained in the Hedging Agreement to which it is a party and without prejudice to its rights as a Facility Beneficiary in respect of the Facility Secured Property);

(c)

exercise any other right of whatsoever nature or claim or exercise any right of set-off or counterclaim which it may have against the Borrower (other than pursuant to any contractual set-off and/or netting provisions contained in the Hedging Agreement to which it is a party and without prejudice to its rights as a Facility Beneficiary in respect of the Facility Secured Property);

(d)

accept or demand any Collateral Instrument from the Borrower in respect of any right referred to in paragraphs (a), (b) and (c) above or dispose of any such right (but without prejudice to its rights as a Facility Beneficiary in respect of the Facility Secured Property);

(e)

take any step to enforce any right against the Borrower (by proceedings or otherwise) (but without prejudice to its rights as a Facility Beneficiary in respect of the Facility Secured Property);

(f)

initiate or take any action which would result in any Insolvency Event in relation to the Borrower; or

(g)

claim or prove in any Insolvency Event in relation to the Borrower;

17.8.2

it will, if so directed by the Facility Agent, prove in any Insolvency Event in relation to the Borrower for the whole or any part of any claim which it may have against the Borrower and on terms that the benefit of such proof and of all moneys received by it in respect thereof shall be held on trust for the Facility Beneficiaries and shall be applied in accordance with clause 10.3.

17.9	FATCA Deduction

17.9.1

Each party may make any FATCA Deduction it is required to make by FATCA, and any payment required in connection with that FATCA Deduction, and no party shall be required to increase any payment in respect of which it makes such a FATCA Deduction or otherwise compensate the recipient of the payment for that FATCA Deduction.

17.9.2

Each party shall promptly, upon becoming aware that it must make a FATCA Deduction (or that there is any change in the rate or the basis of such FATCA Deduction) notify the party to whom it is making the payment and, in addition, shall notify the Borrower, the Facility Agent and the other Facility Beneficiaries.

17.10

FATCA Mitigation

17.10.1

Notwithstanding any other provision to this agreement, if a FATCA Deduction is or will be required to be made by any party under clause 17.9 in respect of a payment to any Facility Lender which is a FATCA FFI (a “FATCA Non-Exempt Lender”), the FATCA Non-Exempt Lender may either:

(a)

transfer its entire interest in the Loan to a U.S. branch or affiliate; or

(b)

(subject to the prior written consent of the Borrower in the case of a transferee which is not already a Facility Lender, such consent not to be unreasonably withheld or delayed) nominate one or more transferee lenders who upon becoming a Facility Lender would be a FATCA Exempt Party, by notice in writing to the Facility Agent and the Borrower specifying the terms of the proposed transfer, and cause such transferee lender(s) to purchase all of the FATCA Non-Exempt Lender’s interest in the Loan.

18	Notices

18.1	Communications in writing

Any communication to be made under or in connection with this Agreement shall be made in writing and, unless otherwise stated, may be made by fax or letter or (subject to clause 18.6) electronic mail.

18.2	Addresses

The address and fax number (and the department or officer, if any, for whose attention the communication is to be made) of each Party for any communication or document to be made or delivered under or in connection with this Agreement are:

18.2.1

in the case of the Borrower, c/o Teekay Shipping (Canada) Ltd, Suite 2000, Bentall 5, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ (fax no: ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇) marked for the attention of ▇▇▇▇▇ Eng, Treasury Manager;

18.2.2

in the case of each Facility Lender, those appearing opposite its name in Schedule 1, Part 1;

18.2.3

in the case of each Hedging Provider those appearing opposite its name in an Accession Deed;

18.2.4

in the case of the Facility Agent, Citibank International Limited, Citigroup Centre, 5^th Floor CGC2, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ (fax no: ▇▇▇ (▇)▇▇ ▇ ▇▇▇ ▇▇▇▇) marked for the attention of European Loans Agency Office and in the case of the Facility Security Trustee: Citibank, N.A., London Branch, Citigroup Centre, 13th Floor, Canada Square, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ (fax no: ▇▇▇(▇) ▇▇▇ ▇▇▇ ▇▇▇▇) marked for the attention of Agency & Trust (email ▇▇▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇);

18.2.5

in the case of the GIEK Agent, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇, for the attention of ▇▇▇▇▇ ▇▇▇▇▇/▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ (Export Agency Finance - CTS), (email: ▇▇▇▇▇.▇▇▇▇▇@▇▇▇▇.▇▇▇, ▇▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇, ▇▇▇▇▇▇▇▇▇.▇▇▇▇▇.▇▇▇▇@▇▇▇▇.▇▇▇, ▇▇▇▇▇▇▇.▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇, ▇▇▇▇▇▇▇▇.▇▇▇@▇▇▇▇.▇▇▇ and ▇▇▇▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇ with copies to ▇▇▇▇.▇▇▇▇@▇▇▇▇.▇▇▇ and ▇▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇.▇▇▇;),

or any substitute address, fax number, department or officer as any party may notify to the Facility Agent (and in the case of a GIEK Facility Lender, the GIEK Agent) (or the Facility Agent or, as the case may be, the GIEK Agent, may notify to the other parties, if a change is made by the Facility Agent, or the GIEK Agent) by not less than three (3) Banking Days’ notice.

18.3	Delivery

Any communication or document made or delivered by one Party to another under or in connection this Agreement will only be effective:

18.3.1

if by way of fax, when received in legible form; or

18.3.2

if by way of letter, when it has been left at the relevant address or five (5) days after being deposited in the post postage prepaid in an envelope addressed to it at that address; or

18.3.3

if by way of electronic mail, in accordance with clause 18.6;

and, if a particular department or officer is specified as part of its address details provided under clause 18.2, if addressed to that department or officer.

Any communication or document to be made or delivered to the Facility Agent, the Facility Security Trustee or the GIEK Agent will be effective only when actually received by the Facility Agent, the Facility Security Trustee or the GIEK Agent.

All notices from or to the Borrower shall be sent through the Facility Agent.

The Facility Agent shall promptly forward to the applicable party a copy of any document which is delivered to it for another party (including all documents addressed to, intended for, or otherwise for the benefit of, the Facility Lenders) and where such document is addressed to the GIEK Facility Lenders, the Facility Agent shall forward it to the GIEK Agent as well.

Any communication or document which becomes effective after 5:00pm London time in the place of receipt shall be deemed to become effective on the following Banking Day.

18.4	Notification of address and fax number

Promptly upon receipt of notification of an address, fax number or change of address, pursuant to clause 18.2 or changing its own address or fax number, the Facility Agent shall notify the other parties to this Agreement.

18.5	English language

Any notice given under or in connection with this Agreement must be in English. All other documents provided under or in connection with this Agreement must be:

18.5.1

in English; or

18.5.2

if not in English, and if so required by the Facility Agent, accompanied by a certified English translation and, in this case, the English translation will prevail unless the document is a constitutional, statutory or other official document.

18.6	Electronic communication

(a)

Any communication to be made in connection with this Agreement may be made by electronic mail or other electronic means, if the Borrower and the relevant Facility Beneficiary and/or GIEK:

(i)

agree that, unless and until notified to the contrary, this is to be an accepted form of communication;

(ii)

notify each other in writing of their electronic mail address and/or any other information required to enable the sending and receipt of information by that means; and

(iii)

notify each other of any change to their address or any other such information supplied by them.

(b)

Any electronic communication made between the Borrower and the relevant Facility Beneficiary will be effective only when actually received in readable form and acknowledged by the recipient (it being understood that any system generated responses do not constitute an acknowledgement) and in the case of any electronic communication made by the Borrower to a Facility Beneficiary only if it is addressed in such a manner as the Facility Beneficiary shall specify for this purpose.

19	Partial Invalidity

If, at any time, any provision of a Facility Document is or becomes illegal, invalid or unenforceable in any respect under any law of any jurisdiction, neither the legality, validity or enforceability of the remaining provisions nor the legality, validity or enforceability of such provision under the law of any other jurisdiction will in any way be affected or impaired.

20	Remedies and Waivers

No failure to exercise, nor any delay in exercising, on the part of any Facility Beneficiary, any right or remedy under a Facility Document shall operate as a waiver, nor shall any single or partial exercise of any right or remedy prevent any further or other exercise or the exercise of any other right or remedy. The rights and remedies provided in this Agreement are cumulative and not exclusive of any rights or remedies provided by law.

21	Miscellaneous

21.1	No oral variations

No variation or amendment of a Facility Document shall be valid unless in writing and signed on behalf of all the Facility Beneficiaries and the relevant Security Party.

21.2	Further Assurance

If any provision of a Facility Document shall be invalid or unenforceable in whole or in part by reason of any present or future law or any decision of any court, or if the documents at any time held by or on behalf of the Facility Beneficiaries or any of them are considered by the Facility Lenders for any reason insufficient to carry out the terms of this Agreement, then from time to time the Borrower will promptly, on demand by the Facility Agent, execute or procure the execution of such further documents as in the opinion of the Facility Lenders are necessary to provide adequate security for the repayment of the Facility Secured Obligations.

21.3	Rescission of payments etc.

Any discharge, release or reassignment by a Facility Beneficiary of any of the security constituted by, or any of the obligations of a Security Party contained in, a Facility Document shall be (and be deemed always to have been) void if any act (including, without limitation, any payment) as a result of which such discharge, release or reassignment was given or made is subsequently wholly or partially rescinded or avoided by operation of any law.

21.4	Certificates

Any certificate or statement signed by an authorised signatory of the Facility Agent purporting to show the amount of the Facility Secured Obligations (or any part of the Facility Secured Obligations) or any other amount referred to in any Facility Document shall, save for manifest error or on any question of law, be conclusive evidence as against the Borrower of that amount.

21.5	Counterparts

This Agreement may be executed in any number of counterparts each of which shall be original but which shall together constitute the same instrument.

21.6	Contracts (Rights of Third Parties) ▇▇▇ ▇▇▇▇

(a)

Unless expressly provided to the contrary in this agreement and subject to the following sentence, a person who is not a Party has no right under the Contracts (Rights of Third Parties) ▇▇▇ ▇▇▇▇ to enforce or to enjoy the benefit of any term of this Agreement. GIEK and each Indemnified Party shall have the right to enforce and enjoy the benefit of any term of this Agreement which is expressed to be for its benefit or expressly purports to confer a benefit on it. Notwithstanding any term of this Agreement, the consent of a person who is not a Party (unless otherwise expressly provided by this Agreement in respect of GIEK and without prejudice to the provisions of the GIEK Guarantee) is not at any time required to rescind or amend this Agreement.

(b)

Each party agrees that GIEK shall not have any obligations or liabilities under this Agreement unless and until it becomes a Facility Lender in accordance with the terms of this Agreement, and this Agreement may not be amended to limit, modify or eliminate any rights of GIEK without its prior written consent.

21.7	Disclosure of Information

The Borrower authorises each Facility Beneficiary to disclose any information and/or document(s) concerning its relationship with such Facility Beneficiary or otherwise delivered pursuant to this Agreement (i) as may be compelled by judicial or legal process or to authorities in any other countries where such Facility Beneficiary or any Affiliate is represented and/or where any Facility Beneficiary or any Affiliate may be requested information by any governmental, banking, taxation or other regulatory authority or similar body, the rules of any relevant stock exchange or pursuant to any applicable law, (ii) to parties to whom that Facility Beneficiary charges, assigns or otherwise creates security (or may do so) pursuant to clause 14.4 or, in the case of the Facility Security Trustee, to any agent or delegate it appoints in accordance with the Facility Documents, (iii) to any Affiliate of that Facility Beneficiary including, without limitation, for the purposes of making it possible to consolidate the member of the TOO Group’s total commitments and offer the member of the TOO Group any other products offered by that Facility Beneficiary or any Affiliate, subject always to the duties of confidentiality on the Facility Beneficiaries, (iv) in the case of the GIEK Facility Lender, to GIEK and the Borrower consents to GIEK publishing key information concerning the GIEK Guarantee including; (A) the Borrower’s and Builder’s names and countries of residence; (B) the date of this Agreement; (C) the loan and guarantee amounts available hereunder; and (D) the type of Vessel financed hereunder, and in connection with such publication, use the Borrower’s and/or the TOO Group’s (as applicable) logo and trademark;, (v) to any rating agency (including its professional advisers), (vi) to any monoline insurers, verification agents and their professional advisers, (vii) to any person which invests in or otherwise finances or may potentially invest in or otherwise finance directly or indirectly in any transaction relating to this Loan, (viii) to the professional advisers of any Facility Beneficiary or its Affiliates, (ix) to any related fund of a Facility Beneficiary and (x) to any person that provides administration or settlement or numbering services in respect of the Facility Documents.

22	Law and Jurisdiction

22.1	Governing law

This Agreement and any non-contractual obligations arising from or in connection with it shall in all respects be governed by and interpreted in accordance with English law.

22.2	Jurisdiction

For the exclusive benefit of the Facility Beneficiaries, the parties to this Agreement irrevocably agree that the courts of England are to have jurisdiction to settle any dispute:

(a)

which may arise out of or in connection with this Agreement; or

(b)

relating to any non-contractual obligations arising from or in connection with this Agreement,

and that any proceedings may be brought in those courts.

22.3	Alternative jurisdictions

Nothing contained in this clause 22 shall limit the right of the Facility Beneficiaries to commence any proceedings against the Borrower in any other court of competent jurisdiction nor shall the commencement of any proceedings against the Borrower in one or more jurisdictions preclude the commencement of any proceedings in any other jurisdiction, whether concurrently or not.

22.4	Waiver of objections

The Borrower irrevocably waives any objection which it may now or in the future have to the laying of the venue of any proceedings in any court referred to in this clause 22, and any claim that those proceedings have been brought in an inconvenient or inappropriate forum, and irrevocably agrees that a judgment in any proceedings commenced in any such court shall be conclusive and binding on it and may be enforced in the courts of any other jurisdiction.

22.5	Service of process

Without prejudice to any other mode of service allowed under any relevant law, the Borrower:

22.5.1

irrevocably appoints Teekay Shipping (UK) Limited of 2^nd Floor, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ as its agent for service of process in relation to any proceedings before the English courts in connection with this Agreement; and

22.5.2

agrees that failure by a process agent to notify the Borrower of the process will not invalidate the proceedings concerned.

Schedule 1

Part 1: The Facility Lenders and the Commitments

COMMERCIAL FACILITY LENDERS


The Commercial Facility Lenders	The Commercial Facility Commitments	The Proportionate Share
	($)	(%)
Citibank N.A., London Branch ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ Tel: ▇▇▇ (▇▇) ▇▇▇▇ ▇▇▇▇ / + ▇▇ (▇▇) ▇▇▇▇ ▇▇▇▇ Fax: ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇ Email: ▇▇▇▇▇▇▇.▇▇▇@▇▇▇▇.▇▇▇, ▇▇▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇ Attention: ▇▇▇▇▇▇▇ ▇▇▇ / ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇	33,000,000	22%
Total	33,000,000	22%

GIEK FACILITY LENDERS


The GIEK Facility Lenders	The GIEK Facility Commitments	The Proportionate Share
	($)	(%)
Citibank N.A., London Branch ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ Tel: ▇▇▇ (▇▇) ▇▇▇▇-▇▇▇▇ / + ▇▇ (▇▇) ▇▇▇▇-▇▇▇▇ Fax: ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇ Email: ▇▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇, ▇▇▇▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇, ▇▇▇▇▇▇▇▇▇.▇▇▇▇▇.▇▇▇▇@▇▇▇▇.▇▇▇, ▇▇▇▇▇▇▇.▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇, ▇▇▇▇▇▇▇▇.▇▇▇@▇▇▇▇.▇▇▇, ▇▇▇▇.▇▇▇▇@▇▇▇▇.▇▇▇, ▇▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇.▇▇▇ Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ / Frithiof Wilhelmsen / ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Basi / ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ / ▇▇▇▇▇▇▇▇ ▇▇▇ / ▇▇▇▇ ▇▇▇▇ / ▇▇▇▇▇▇ ▇▇▇▇▇▇	92,000,000	61.33%


Kommunal Landspensjonskasse, Gjensidig Forsikringsselkap Dronning Eufemias gate 10 ▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇	25,000,000	16.67%

Credit related matters Tel: ▇▇▇ ▇▇▇▇ ▇▇▇▇ Fax: ▇▇▇ ▇▇▇▇ ▇▇▇▇ Email: ▇▇▇▇.▇▇▇▇▇▇▇▇.▇▇▇▇▇▇▇@▇▇▇.▇▇ ▇▇▇▇▇▇▇▇▇@▇▇▇.▇▇ Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇

Operational matters Tel: ▇▇▇ ▇▇▇▇ ▇▇▇▇ / ▇▇▇ ▇▇▇▇ ▇▇▇▇ Fax: ▇▇▇ ▇▇▇▇ ▇▇▇▇ Email: ▇▇▇▇▇▇▇@▇▇▇.▇▇ ▇▇▇@▇▇▇.▇▇ Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇

Total	117,000,000	78%

Part 2: The MLAs

The MLAS

Citibank N.A, London Branch

▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇

▇▇▇▇▇▇ ▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇

Tel: ▇▇▇ (▇▇) ▇▇▇▇-▇▇▇▇ / + ▇▇ (▇) ▇▇▇▇-▇▇▇▇

Fax: ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇

Email: ▇▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇, ▇▇▇▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇, ▇▇▇▇▇▇▇▇▇.▇▇▇▇▇.▇▇▇▇@▇▇▇▇.▇▇▇, ▇▇▇▇▇▇▇.▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇, ▇▇▇▇▇▇▇▇.▇▇▇@▇▇▇▇.▇▇▇, ▇▇▇▇.▇▇▇▇@▇▇▇▇.▇▇▇, ▇▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇.▇▇▇

Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ / Frithiof Wilhelmsen / ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Basi / ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ / ▇▇▇▇▇▇▇▇ ▇▇▇ / ▇▇▇▇ ▇▇▇▇ / ▇▇▇▇▇▇ ▇▇▇▇▇▇

Schedule 2

Part 1: conditions precedent to the Advance

1	Security Parties

(a)

Constitutional Documents: Copies of the constitutional documents of each Security Party (other than the Manager) together with such other evidence as the Facility Agent may reasonably require that each such Security Party is duly formed or incorporated in its country of formation or incorporation and remains in existence with power to enter into, and perform its obligations under, the Transaction Documents to which it is or is to become a party.

(b)

Certificates of good standing: A certificate of good standing in respect of each Security Party (other than the Manager) (if such a certificate can be obtained).

(c)

Board resolutions: A copy of a resolution of the board of directors of each Security Party (other than the Manager) (or its sole member or general partner):

(i)

approving the terms of, and the transactions contemplated by, the Transaction Documents to which it is a party and ratifying or resolving that it execute those Transaction Documents; and

(ii)

if required authorising a specified person or persons to execute those Transaction Documents (and all documents and notices to be signed and/or despatched under those documents) on its behalf.

(d)

Officer’s certificates: A certificate of a duly authorised officer or representative of each Security Party (other than the Manager) certifying that:

(i)

each copy document relating to it specified in this Part 1 of Schedule 2 (other than the certificates of good standing) is correct, complete and in full force and effect as at a date no earlier than the date of this Agreement; and

(ii)

setting out the names of the directors and officers of that Security Party (or its sole member or general partner) and the proportion of shares held by each shareholder;

(e)

Powers of attorney: The notarially attested and legalised (where necessary for registration purposes) power of attorney of each Security Party (other than the Manager) under which any documents are to be executed or transactions undertaken by that Security Party.

2	Security and related documents

(a)

Project Documents: A photocopy, certified as true, accurate, complete and in full force and effect by a duly authorised representative of the Borrower, of the Project Documents, together with all addenda, amendments or supplements.

(b)

Facility Documents: An original of each Facility Document (including, but not limited to, each Facility Security Document but excluding Hedging Agreements), in each case duly executed by each party thereto together with all other documents required by any of them, including, without limitation, all notices of assignment and/or charge, filing, registration and evidence that those notices will be duly acknowledged by the recipients, in each case duly executed by each party thereto for the purpose of the effectiveness of the aforementioned Facility Documents.

3	Notices and Consents

Evidence acceptable to the Facility Agent that the notices of assignment (as required) will on the Delivery Date be served by the Borrower and the Bareboat Charterer in respect of the Assignment and the Bareboat Charterer Assignment (for the avoidance of doubt excluding the Charterer Consent and notice of assignment given to the Charterer).

4	Legal opinions

Legal opinions of the legal advisers to the Facility Agent in each relevant jurisdiction, substantially in the form provided to the Facility Agent (and addressed to the Facility Security Trustee) or confirmation satisfactory to the Facility Agent that such an opinion will be given, namely:

(a)

an opinion on matters of English law from Norton ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ LLP;

(b)

an opinion on matters of ▇▇▇▇▇▇▇▇ Island law and New York law from ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP;

(c)

an opinion on matters of Norwegian law from Advokatfirmaet Schjodt AS;

(d)

an opinion on matters of Singapore law from Norton ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ (Asia) LLP;

(e)

an opinion on matters of Brazilian law from ▇▇▇▇▇▇ Filho, ▇▇▇▇▇ Filho, Marrey Jr e ▇▇▇▇▇▇▇ Advogados; and

(f)

an opinion on matters of Bahamas law from ▇▇▇▇▇ & ▇▇▇▇▇▇▇.

5	Other documents and evidence

(a)

Process agent: Evidence that any process agent referred to in clause 22.5.1 and any process agent appointed under each Facility Document accepted its appointment.

(b)

Other authorisations: Other than the Charterer Consent, a copy of any other consent, licence, approval, authorisation or other document, opinion or assurance which the Facility Agent considers to be necessary or desirable (if it has notified the Borrower accordingly) in connection with the entry into and performance of the transactions contemplated by any of the Transaction Documents or for the validity and enforceability of any of the Transaction Documents.

(c)

Fees: Evidence that the fees, costs and expenses then due from the Borrower under clause 8 and clause 9 have been paid or will be paid on the date upon which they fall due.

(d)

“Know your customer” documents: Such documentation and other evidence as is reasonably requested by the Facility Agent in order for the Facility Lenders to comply with all necessary “know your customer” or similar identification procedures in relation to the transactions contemplated in the Facility Documents.

6	Certificate of ownership

Evidence satisfactory to the Facility Agent of the direct or indirect ownership (i) by the Sponsor of the shares in the Shareholder, and (ii) by the Shareholder of the shares in the Borrower and the Bareboat Charterer.

7	GIEK Guarantee

(a)

The GIEK Guarantee has been issued and is in full force and effect.

(b)

A legal opinion from the legal advisers to the Facility Agent in Norway on matters of Norwegian law, which shall include confirmation that the terms of the Facility Documents comply with the requirements of GIEK Guarantee, that the GIEK Guarantee has been duly issued for the benefit of the GIEK Facility Lenders by GIEK and that it is in full force and effect.

(c)

A confirmation from GIEK that the Eligible Costs are acceptable and confirmation of the amount of the Hiload Eligible Costs.

8	Earnings Account

The Earnings Account and Bareboat Charterer Earnings Account shall each have been opened with the Account Bank.

9	Other Indebtedness

Confirmation in form and substance satisfactory to the Facility Agent that any and all other amounts of indebtedness relating to the Vessel are fully subordinated in terms of payment and security to the Facility Documents.

10	Security and related documents

(a)

Evidence of Borrower’s title: Evidence satisfactory to the Facility Agent that the certificate of ownership and encumbrance (or equivalent) issued by the Registrar of Ships (or equivalent official) of the Vessel’s Flag State will be issued on the Delivery Date confirming that (a) the Vessel is permanently registered under that flag in the ownership of the Borrower, (b) the Mortgage has been registered with first priority against the Vessel and (c) there are no further or other Security Interests registered against the Vessel.

(b)

Certificate of no Security Interests: A certificate from the Borrower that upon the Delivery Date the Vessel is free of Security Interests other than Permitted Security Interests.

(c)

Evidence of insurance: Evidence that the Vessel is insured in the manner required by the Facility Security Documents and that letters of undertaking will be issued in the manner required by the Facility Security Documents, together with the written approval of the Insurances by an insurance adviser appointed by the Mandated Lead Arrangers and/or Facility Agent (acting on the instructions of the Majority Facility Lenders).

(d)

Confirmation of class: Certificate of Confirmation of Class confirming that the Vessel is classed with the highest class applicable to Vessel of her type with a Classification Society.

11	Valuation

A Valuation.

12	Additional Conditions

(a)

A copy, certified as a true copy by a duly authorised officer of the Borrower of the agreed drafts of the protocol of delivery and acceptance under the Building Contract, with executed copies to be provided as soon as practicable on the Delivery Date, evidencing that the Vessel will be delivered to the Borrower.

(b)

Evidence satisfactory to the Lenders that the Borrower has paid, or the Security Parties have procured that there is paid, to the Builder an amount equal to at least thirty per cent (30%) of the Vessel Total Cost from equity.

Part 2: Conditions subsequent

1	Letters of undertaking

Within five (5) Banking Days after the Delivery Date, letters of undertaking in respect of the Insurances as required by the Facility Documents together with copies of the relevant policies or cover notes or entry certificates duly endorsed with the interest of the Facility Beneficiaries.

2	Acknowledgements of notices

As soon as practicable after the execution of each relevant Facility Document but no later than ten (10) days after the execution of each such Facility Document, acknowledgements of all notices of assignment and/or charge given pursuant to that Facility Document.

3	Legal opinions

Within one hundred and eighty (180) days of the date of this Agreement, An opinion on matters of Dutch law from Norton ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ LLP, Amsterdam.

Such other legal opinions specified in this Schedule 2 as have not already been provided to the Facility Agent.

4	Budget

Within thirty (30) days of the Drawdown Date for the Advance a budget for operation of the Vessel for the immediately following period of twelve (12) months showing amongst other things proposed capital expenditure.

5	ISS Certificate

Within four (4) calendar months of the Delivery Date, a valid and current DOC issued pursuant to the ISM Code, a valid and current SMC issued in respect of the Vessel pursuant to the ISM Code and any other certificates issued under any applicable code required to be observed by the Vessel or in relation to its operation under Applicable Law.

6	Brazilian Certification and Registration Requirements

By the earlier of (i) one hundred and eighty (180) days of the date of this Agreement, and (ii) ten (10) Banking Days prior to the first Application Date, evidence satisfactory to the Facility Agent that the Brazilian Certification and Registration Requirements related to this Agreement, the Mortgage, the Deed of Covenants, the Bareboat Charter Assignment, the Assignment, the Borrower Security Power of Attorney, the Bareboat Charterer Security Power of Attorney, the Notice of Assignment to the Charterer, and the Charter Consent have been performed.

7	Charterer Consent

Within one hundred and eighty (180) days of the date of this Agreement, the Facility Agent has received the Charterer Consent and provided the Notice of Assignment to the Charterer.

Schedule 3

Form of Drawdown Notice

To: [●]

[●]

Attention: [●]

Fax No: [●]

Email: [●]


From: LOGITEL OFFSHORE RIG I PTE. LTD.		[Date]

Dear Sirs,

Drawdown Notice

We refer to the Loan Agreement dated [●] 2015 made between, amongst others, ourselves and yourselves (the Agreement).

Words and phrases defined in the Agreement have the same meaning when used in this Drawdown Notice.

Pursuant to clause 4.1 of the Agreement, we irrevocably request that you make the Advance in the sum of [●], being:

[●] in respect of the GIEK Facility Advance;

[●] in respect of the Commercial Facility Advance,

to us on [●], which is a Banking Day, by paying the amount of the Advance to [●].

The first Interest Period shall be for a duration of [3/6] months.

We warrant that the representations and warranties contained in clause 11 (except for clauses 11.2, 11.6 and 11.18) of the Agreement are true and correct at the date of this Drawdown Notice and will be true and correct on [●], that no Default has occurred and is continuing, and that no Default will result from the advance of the sum requested in this Drawdown Notice.

Yours faithfully

.............................

For and on behalf of

LOGITEL OFFSHORE RIG I PTE. LTD.

Schedule 4

Form of Transfer Certificate


To:		[●]
		[●]

		Attention: [●]
		Fax No: [●]
		Email: [●]

TRANSFER CERTIFICATE

This transfer certificate relates to a secured loan facility agreement (as from time to time amended, varied, supplemented or novated the Loan Agreement) dated [●] 2015, on the terms and subject to the conditions of which a secured term loan facility was made available to Logitel Offshore Rig I Pte. Ltd., by a syndicate of banks on whose behalf you act as facility agent and facility security trustee.

1	Terms defined in the Loan Agreement shall, unless otherwise expressly indicated, have the same meaning when used in this certificate. The terms Transferor and Transferee are defined in the schedule to this certificate.

2	The Transferor:

(a)

confirms that the details in the Schedule under the heading Transferor’s Commitment accurately summarise its Commitment; and

(b)

requests the Transferee to accept by way of novation the transfer to the Transferee of the amount of the Transferor’s Commitment specified in the Schedule by counter-signing and delivering this certificate to the Facility Agent at its address for communications specified in the Loan Agreement.

3	The Transferee requests the Facility Agent to accept this certificate as being delivered to the Facility Agent pursuant to and for the purposes of clause 14.5 of the Loan Agreement so as to take effect in accordance with the terms of that clause on the Transfer Date specified in the Schedule.

4	The Facility Agent confirms its acceptance of this certificate for the purposes of clause 14.4 of the Loan Agreement.

5	The Transferee confirms that:

(a)

it has received a copy of the Loan Agreement together with all other information which it has required in connection with this transaction;

(b)

it has not relied and will not in the future rely on the Transferor or any other party to the Loan Agreement to check or enquire on its behalf into the legality, validity, effectiveness, adequacy, accuracy or completeness of any such information; and

(c)

it has not relied and will not in the future rely on the Transferor or any other party to the Loan Agreement to keep under review on its behalf the financial condition, creditworthiness, condition, affairs, status or nature of any Security Party.

Execution of this certificate by the Transferee constitutes its representation and warranty to the Transferor and to all other parties to the Loan Agreement that it has the power to become a party to the Loan Agreement as a Facility Lender on the terms of the Loan Agreement and has taken all steps to authorise execution and delivery of this certificate.

The Transferee undertakes with the Transferor and each of the other parties to the Loan Agreement that it will perform in accordance with their terms all those obligations which by the terms of the Loan Agreement will be assumed by it after delivery of this certificate to the Facility Agent and the satisfaction of any conditions subject to which this certificate is expressed to take effect.

The Transferor makes no representation or warranty and assumes no responsibility with respect to the legality, validity, effectiveness, adequacy or enforceability of any Facility Document or any document relating to any Facility Document, and assumes no responsibility for the financial condition of any Facility Beneficiary or for the performance and observance by any Security Party of any of its obligations under any Facility Document or any document relating to any Facility Document and any conditions and warranties implied by law are expressly excluded.

9	The Transferee acknowledges that nothing in this certificate or in the Loan Agreement shall oblige the Transferor to:

(a)

accept a re-transfer from the Transferee of the whole or any part of the rights, benefits and/or obligations transferred pursuant to this certificate; or

(b)

support any losses directly or indirectly sustained or incurred by the Transferee for any reason including, without limitation, the non-performance by any party to any Facility Document of any obligations under any Facility Document.

10	The address and fax number of the Transferee for the purposes of clause 18 of the Loan Agreement are set out in the Schedule.

11	This certificate may be executed in any number of counterparts each of which shall be original but which shall together constitute the same instrument.

12	This certificate and all non-contractual obligations in connection with it shall be governed by and interpreted in accordance with English law.

THE SCHEDULE

Transferor:

Transferee:

Transfer Date

Transferor’s Commitment:

Amount transferred:

Transferee’s address and fax number for the purposes of clause 18 of the Loan Agreement:


[*name of Transferor]*		*[name of Transferee*]

By:		By:

Date:		Date:

[l] as Facility Agent and on behalf of each of the Facility Beneficiaries and the Borrower

By:

Date:

Schedule 5

Schedule of Repayment Amounts


(1) Application Dates	(2) Repayment Amount ($) (GIEK)		(3) Repayment Amount ($) (Commercial)

1		5,850,000		1,650,000

2		5,850,000		1,650,000

3		5,850,000		1,650,000

4		5,850,000		1,650,000

5		5,850,000		1,650,000

6		5,850,000		1,650,000

7		5,850,000		1,650,000

8		5,850,000		1,650,000

9		5,850,000		1,650,000

10		5,850,000		1,650,000

11		5,850,000		1,650,000

12		5,850,000		14,850,000

13		5,850,000

14		5,850,000

15		5,850,000

16		5,850,000

17		5,850,000

18		5,850,000

19		5,850,000

20		5,850,000

TOTAL		117,000,000		33,000,000

Schedule 6

Definitions

Accession Deed means an accession deed substantially in the terms of Schedule 8.

Account Bank means in respect of the Earnings Account, DNB Bank ASA, New York branch acting through its office at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇, and in respect of the Bareboat Charterer Earnings Account, DNB Bank ASA, Oslo Branch acting through its office at Oslo Norway.

Account Charge means the account charge relating to the Earnings Account executed or, as the context may require, to be executed by the Borrower in favour of the Facility Security Trustee and the deposit account control agreement between the Borrower, the Account Bank and the Facility Security Trustee.

Accounting Reference Date means 31 December.

Additional Facility means an export credit supported term loan facility for the purpose of financing (in whole or part) Rig 2 and/or Rig 3 upon delivery thereof (where there is to be cross-collateralisation between the Additional Facility and this Facility) but excludes a Restatement.

Additional Facility Principles means each of the principles set out in Schedule 9.

Advance means the amount advanced or to be advanced by the Facility Lenders to the Borrower under clause 4 of this Agreement.

Affiliate means, in relation to any entity, a Subsidiary of that entity, a Holding Company of that entity or any other Subsidiary of that Holding Company.

Agreed Form in relation to any document, means that document in form, substance and terms approved in writing by the Facility Agent (acting on the instructions of all of the Facility Lenders) and a Security Party or otherwise in accordance with any such other approval procedure detailed in any relevant provision of this Agreement and any other Facility Document.

Applicable Law means, in relation to any jurisdiction or the European Union, any law, regulation, treaty, directive, decision, rule, regulatory requirement, judgment, order, ordinance request, guideline or direction or any other act of any Government Entity of such jurisdiction or of any EU Institution whether or not having the force of law and with which any relevant person is required to comply.

Application Date means (a) the date falling six (6) months after the Drawdown Date, (b) each date falling six (6) months subsequently to the previous Application Date within the Facility Security Period, (c) the GIEK Final Maturity Date, and (d) the Commercial Final Maturity Date.

Approved Brokers means H Clarkson & Co. Ltd, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇ Shipbrokers Ltd, Fearnley AS, ▇.▇. ▇▇▇▇▇▇ AS, Braemar Seascope and ▇▇▇▇▇▇▇ ▇▇▇▇ or such other firm or firms of reputable and independent ship brokers as may from time to time be approved in writing by the Facility Agent (acting on the instructions of the Majority Facility Lenders and GIEK, acting reasonably).

Assignment means the first priority security assignment executed or to be executed by the Borrower in favour of the Facility Security Trustee, in the Agreed Form.

Authorisation means an authorisation, consent, approval, resolution, licence, exemption, filing, notarisation or registration.

Availability Period means the period commencing at the date of this Agreement and ending on the earlier of (i) the Drawdown Date for the Advance (ii) the Delivery Date, and (iii) 25 August 2015.

Banking Day means a day (other than Saturday or Sunday) on which banks are open for normal banking business in London, Oslo, Singapore and New York.

Bareboat Charter means the time charter agreement, entered into or to be entered into between the Bareboat Charterer and the Borrower in relation to the Vessel in the Agreed Form.

Bareboat Charterer means Logitel Offshore Norway AS, a company incorporated in Norway with registered company number 912 437 027 and its registered office at ▇▇▇▇▇▇ ▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇.

Bareboat Charterer Account Charge means the account charge relating to the Bareboat Charterer Earnings Account executed or, as the context may require, to be executed by the Bareboat Charterer in favour of the Facility Security Trustee, in the Agreed Form.

Bareboat Charterer Assignment means the deed of assignment executed or, as the context may require, to be executed by the Bareboat Charterer in favour of the Borrower, in the Agreed Form.

Bareboat Charterer Earnings Account means account number ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇ held by the Bareboat Charterer with the Account Bank and includes any redesignation and sub-accounts thereof.

Bareboat Charterer Security Power of Attorney means the power of attorney coupled with security and issued or to be issued by the Bareboat Charterer in favour of the Facility Security Trustee in the Agreed Form.

Basel III means, together:

(a)

the agreements on capital requirements, a leverage ratio and liquidity standards contained in “Basel III: A global regulatory framework for more resilient banks and banking systems”, “Basel III: International framework for liquidity risk measurement, standards and monitoring” and “Guidance for national authorities operating the countercyclical capital buffer” published by the Basel Committee on Banking Supervision in December 2010, each as amended, supplemented or restated;

(b)

the rules for global systemically important banks contained in “Global systemically important banks: assessment methodology and the additional loss absorbency requirement—Rules text” published by the Basel Committee on Banking Supervision in November 2011, as amended, supplemented or restated; and

(c)

any further guidance or standards published by the Basel Committee on Banking Supervision relating to “Basel III”.

Bookrunner means Citibank N.A., London Branch.

Borrowed Money means Indebtedness (without double counting) in respect of (i) money borrowed or raised and debit balances at banks, (ii) any bond, note, loan stock, debenture or similar debt instrument, (iii) acceptance or documentary credit facilities, (iv) receivables sold or discounted (otherwise than on a non-recourse basis), (v) deferred payments for assets or services acquired having the commercial effect of a borrowing or raising of money (but not ordinary trade credit), (vi) finance leases and hire purchase contracts which, in accordance with GAAP, are at the relevant time treated as a finance or capital lease (but only to the extent of such treatment), (vii) the marked to market value of Derivatives Contracts, (viii) any other transaction (including without limitation forward sale or purchase agreements) having the commercial effect of a borrowing or raising of money or of any of (ii) to (vii) above and (ix) guarantees in respect of Indebtedness of any other person falling within any of (i) to (viii) above.

Borrower means Logitel Offshore Rig I Pte. Ltd., a private limited company incorporated in Singapore whose registered office is at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ #▇▇-▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇.

Borrower Security Power of Attorney means the power of attorney coupled with security and issued by the Borrower in favour of the Facility Security Trustee, in the Agreed Form.

Borrower Share Pledge means the first priority pledge agreement in respect of all of the shares in the Borrower executed or to be executed by the Shareholder in favour of the Facility Security Trustee, in the Agreed Form.

Brazilian Certification and Registration Requirements means, in relation to a Facility Document:

(a)

if any person executed that Facility Document in Brazil, certification (reconhecimento de firma) of that person’s signature;

(b)

if any person executed that Facility Document outside Brazil, certification by a notary of that person’s signature and (if the person executed that Facility Document outside Brazil, Argentina, France, Spain, Italy, Paraguay and Uruguay) legalisation of the signature and seal of that notary in the relevant Brazilian Consulate; and

(c)

a certified translation of that Facility Document into Portuguese.

Break Costs means the amount (if any) by which:

(a)

the interest (excluding the Margin) which a Facility Lender should have received for the period from the date of receipt of all or any part of its participation in the Advance or the Loan or an Unpaid Sum to the last day of the current Interest Period in respect of that Advance or the Loan or that Unpaid Sum, had that Advance or the Loan or that Unpaid Sum been paid on the last day of that Interest Period,

exceeds:

(b)

the amount which that Facility Lender would be able to obtain by placing an amount equal to the principal amount equal to its participation in that Advance or the Loan or that Unpaid Sum received by it on deposit with a leading bank in the London Interbank Market for a period starting on the Banking Day following receipt or recovery and ending on the last day of the current Interest Period.

Builder means, COSCO Nantong Shipyard Co. Ltd., of ▇▇. ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, Peoples’ Republic of China.

Building Contract means the building contract dated 18 June 2013 between the Builder and the Borrower.

Casualty Amount means ten million Dollars ($10,000,000) or the equivalent in any other currency.

Change in Law means the occurrence, after the date of this Agreement, of any of the following:

(a)

the adoption or taking effect of any law, rule, regulation or treaty;

(b)

any change in law, rule, regulation or treaty or in the administration, interpretation implementation or application thereof by any Government Entity; or

(c)

the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Government Entity,

provided that notwithstanding anything herein to the contrary, (x) the ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇ Street Reform and Consumer Protection Act of the United States of America, passed in 2010 and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law” regardless of the date enacted, adopted or issued.

Charter means the time charter agreement dated 8 November 2013 between the Bareboat Charterer, the Charterer and Sevan Marine ASA, as amended from time to time by a Permitted Amendment.

Charter Period means the Term (as defined in the Charter).

Charter Proceeds means all hires, freights, pool income and other sums payable to or for the account of the Bareboat Charterer in respect of the Vessel including (without limitation) the account of all remuneration for salvage and towage services, demurrage and detention moneys, contributions in general average, compensation in respect of a requisition for hire and damages and other payments (whether awarded by any court or arbitral tribunal or by agreement or otherwise) for breach, termination or variation of any contract for the operation, employment or use of the Vessel.

Charter Rate means the full amount of that part of the daily rate payable under the Charter in Dollars (being initially one hundred and fifty two thousand and five hundred Dollars ($152,500)).

Charterer means Petrobras Netherlands B.V., a company incorporated under the laws of the Kingdom of Netherlands with its registered office at Weenapoint, Toren A, Weena ▇▇▇, ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇.

Charterer Consent means the written consent from the Charterer consenting to the assignment of the rights under the Charter pursuant to the Assignment and the Bareboat Charterer Assignment in the Agreed Form.

Classification means the class notation DNV +1A1, Accommodation Unit ECO DYNPOS AUTRO, POSMOOR ATA/V(Option), CLEAN, HELDK-SH, CRANE, COMF C(3), COMF V(3) with the Classification Society and such other additional class notations (e.g. relating to self-propelled or operating environment or fatigue analysis) in relation to the Vessel as the Facility Security Trustee shall, at the request of the Borrower, have agreed in writing which shall be treated as the Classification of the Vessel, for the purposes of this Agreement and the other Facility Documents.

Classification Society means any of DNV GL, Lloyds Register, American Bureau of Shipping (ABS) or Bureau Veritas or such other classification society acceptable to the Majority Facility Lenders.

Collateral means any and all assets over or in respect of which any Security Interest is created or expressed to be created by any Security Party in favour of the Facility Beneficiaries or any of them pursuant to or in accordance with any of the Facility Security Documents.

Collateral Instruments means notes, bills of exchange, certificates of deposit and other negotiable and non-negotiable instruments, guarantees, indemnities and other assurances against financial loss and any other documents or instruments which contain or evidence an obligation (with or without security) to pay, discharge or be responsible directly or indirectly for any indebtedness or liabilities of any person and includes any documents or instruments creating or evidencing an Security Interest.

Commercial Facility means the term loan facility made available by the Commercial Facility Lenders under this Agreement as described in clause 2 of this Agreement.

Commercial Facility Advance means an advance of the Commercial Facility Commitments in accordance with clause 4 of this Agreement.

Commercial Facility Commitment means:

(a)

in relation to a Commercial Facility Lender at the date of this Agreement, the amount set opposite its name under the heading “Commercial Facility Commitment” in Schedule 1, Part 1 and the amount of any other Commercial Facility Commitment transferred to it under this Agreement; and

(b)

in relation to any other Commercial Facility Lender, the amount of any Commercial Facility Commitment transferred to it under this Agreement,

to the extent not cancelled, reduced or transferred by it under this Agreement.

Commercial Facility Lenders means:

(a)

the Commercial Facility Lenders set out in Schedule 1, Part 1 of this Agreement; and

(b)

any bank, financial institution or other regulated investment company which has become a party as a Commercial facility lender in accordance with clause 14,

which in each case has not ceased to be a party in accordance with the terms of this Agreement.

Commercial Final Maturity Date means the date falling on the sixth (6th) anniversary of the Drawdown Date.

Commercial Final Payment means the amount of the Commercial Loan outstanding and owing to the Commercial Facility Lenders as of the Commercial Final Maturity Date.

Commercial Loan means a loan made or to be made under the Commercial Facility or the principal amount outstanding for the time being of that loan.

Commitment means, in relation to a Facility Lender, its GIEK Facility Commitment and/or Commercial Facility Commitment.

Commitment Fee means the commitment commission payable by the Borrower pursuant to clause 9.1 of this Agreement.

Compulsory Acquisition means requisition for use or title or other compulsory acquisition, nationalisation, requisition, appropriation, expropriation, deprivation, forfeiture or confiscation for any reason of the Vessel by any Government Entity or other competent authority, whether de jure or de facto, but shall exclude requisition for hire not involving requisition for title.

Contribution means, in relation to a Facility Lender, the part of the Loan which is owing to that Facility Lender.

Currency of Account means, in relation to any payment to be made to a Facility Beneficiary under a Facility Document, the currency in which that payment is required to be made by the terms of that Facility Document.

Deed of Covenants means the first priority deed of covenant collateral to the Mortgage executed or, as the context may require, to be executed by the Borrower in favour of the Facility Security Trustee, in the Agreed Form.

Default means any Event of Default or any event or circumstance specified in clause 13.1 of this Agreement which would, with the giving of a notice and/or the expiry of the relevant period and/or the fulfilment of any other condition, become an Event of Default.

Defaulting Facility Lender means any Facility Lender which has failed to make its participation in the Advance available (or has notified the Facility Agent or the Borrower (which has notified the Facility Agent) that it will not make its participation in the Advance available) by the Drawdown Date of the Advance in accordance with clause 4 unless:

(i)

its failure to pay is caused by:

(A)

administrative or technical error; or

(B)

a Disruption Event; and

payment is made within ten Banking Days of its due date; or

(ii)

the Facility Lender is disputing in good faith whether it is contractually obliged to make the payment in question.

Default Rate means the interest rate specified in clause 7.7 of this Agreement.

Delivery Date means the date upon which the Vessel is delivered to, title is transferred to, and accepted by, the Borrower under the Building Contract,

Derivatives Contract means a contract, agreement or transaction which is:

(a)

a rate swap, basis swap, commodity swap, forward rate transaction, commodity option, equity (or equity or other index) swap or option, bond option, interest rate option, foreign exchange transaction, cap, collar or floor, currency swap, currency option or any other similar transaction; and/or

(b)

any combination of such transactions,

in each case, whether on-exchange or otherwise.

Disruption Event means either or both of:

(a)

a material disruption to those payment or communications systems or to those financial markets which are, in each case, required to operate in order for payments to be made in connection with the Facility (or otherwise in order for the transactions contemplated by the Facility Documents to be carried out) which disruption is not caused by, and is beyond the control of, any of the Parties; or

(b)

the occurrence of any other event which results in a disruption (of a technical or systems- related nature) to the treasury or payments operations of a Party preventing that, or any other Party:

(i)

from performing its payment obligations under the Facility Documents; or

(ii)

from communicating with other Parties in accordance with the terms of the Facility Documents,

and which (in either such case) is not caused by, and is beyond the control of, the Party whose operations are disrupted.

Distribution means, in relation to a person, any payment by or distribution of assets by that person, whether in cash, property, securities or otherwise.

DOC means, in relation to the ISM Company, a valid Document of Compliance issued for the ISM Company by the Administration under paragraph 13.2 of the ISM Code.

Dollars and $ mean the lawful currency of the United States of America and in respect of all payments to be made under this Agreement and the other Transaction Documents in Dollars mean funds which are for same day settlement in the New York Clearing House Interbank Payments System (or such other US dollar funds as may at the relevant time be customary for the settlement of international banking transactions denominated in US dollars).

Drawdown Date means the date, being a Banking Day within the Availability Period, on which the Advance is, or is to be, drawn down or made pursuant to clause 4 of this Agreement.

Drawdown Notice means a notice in the form or substantially in the form of Schedule 3 to this Agreement.

Earnings means the Revenue and the Charter Proceeds.

Earnings Account means account number ▇▇▇▇▇▇▇▇ held by the Borrower with the Account Bank and includes any redesignation and sub-accounts thereof.

Eligible Costs means the costs, expressed in Dollars, incurred by the Borrower or any other member of the TOO Group for the project involving the Vessel and Rig 2 which constitute Norwegian content.

Environmental Affiliate means an agent or employee of the Borrower or the Bareboat Charterer or the Manager or a person in a contractual relationship with the Borrower or the Bareboat Charterer or the Manager (other than the Charterer) in respect of the Vessel (including without limitation, the operation of or the carriage of cargo of the Vessel).

Environmental Approvals means any present or future permit, licence, approval, ruling, variance, exemption or other authorisation required under applicable Environmental Laws.

Environmental Claim means any and all enforcement, clean-up, removal, administrative, governmental, regulatory or judicial actions, orders demands or investigations instituted or completed pursuant to any Environmental Laws or Environmental Approvals together with any claims made by any third person relating to damage, contribution, loss or injury resulting from any Environmental Incident.

Environmental Incident means:

(a)

any release of Environmentally Sensitive Material from the Vessel; or

(b)

any incident in which Environmentally Sensitive Material is released from a vessel other than the Vessel which involves a collision between the Vessel and such other vessel or some other incident of navigation or operation between the Vessel and such other vessel, in either case, in connection with which the Vessel is actually or potentially liable to be arrested, attached, detained or injuncted and/or where any guarantor, any manager (or any sub-manager) of the Vessel or any of its officers, employees, or other persons retained or instructed by it (or such sub-manager) are at fault or are allegedly at fault or otherwise liable to any legal or administrative action; or

(c)

any other incident in which Environmentally Sensitive Material is released otherwise than from the Vessel and in connection with which the Vessel is actually or potentially liable to be arrested and/or where any guarantor, any manager (or any sub-manager) of the Vessel or any of its officers, employees or other persons retained or instructed by it (or such sub-manager) are at fault or allegedly at fault or otherwise liable to any legal or administrative action.

Environmental Law includes all present and future laws, regulations, treaties and contentions of any applicable jurisdiction which:

(a)

have as a purpose or effect the protection of, and/or prevention of, harm or damage to, the Environment;

(b)

relate to the carriage of Environmentally Sensitive Material or to actual or threatened releases of Environmentally Sensitive Material;

(c)

provide remedies or compensation for harm or damage to the environment; or

(d)

relate to Environmentally Sensitive Material or health, social or safety matters.

Environmentally Sensitive Material means (i) oil and oil products and (ii) any other waste, pollutant, contaminant or other substance (including any liquid, solid, gas, ion, living organism or noise) that may be harmful to human health or other life or the environment or a nuisance to any person or that may make the enjoyment, ownership or other territorial control of any affected land, property or waters more costly for such person to a material degree.

Equator Principles means the set of environmental guidelines developed by commercial banks and the International Finance Corporation for the purpose of assessing and managing environmental and social issues related to private sector project financings, as adopted on 4 June 2003 and revised in June 2006 and as revised from time to time.

Event of Default means any of the events or circumstances described in clause 13.1 of this Agreement.

Expenses means:

(a)

all Losses suffered, incurred or paid by any Facility Beneficiary, GIEK or any Insolvency Official in connection with the exercise of the rights, remedies and powers granted by, referred to in, or otherwise contemplated by the Facility Documents; and

(b)

interest on those Losses at the Default Rate, from the date of demand by the relevant Facility Beneficiary, GIEK or Insolvency Official to the date of payment (after as well as before judgment).

Facility means each of the GIEK Facility and the Commercial Facility, and Facilities means all of them.

Facility Agent means Citibank International Limited acting through its office at Citigroup Centre, 5^th Floor CGC2, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ or such other person as may be appointed agent for the Facility Lenders pursuant to clause 15.21 or clause 15.22 of this Agreement.

Facility Beneficiaries means together the Facility Agent, the Facility Security Trustee, the GIEK Agent, the Mandated Lead Arrangers, the Bookrunner, the Hedging Providers and the Facility Lenders (each a Facility Beneficiary).

Facility Documents means:

(a)

this Agreement;

(b)

the Fee Letters;

(c)

the Financial Guarantee;

(d)

the Hedging Agreements;

(e)

the Payment Direction Letter;

(f)

the Letter of Undertaking;

(g)

any Accession Deed;

(h)

the Facility Security Documents; and

(i)

each other document which the Borrower and the Facility Agent agree shall be a Facility Document for the purposes of the Facility Documents,

(each a Facility Document).

Facility Lenders means together the GIEK Facility Lenders and the Commercial Facility Lenders (each a Facility Lender).

Facility Limit means one hundred and fifty million Dollars ($150,000,000).

Facility Secured Obligations means all monies, obligations and liabilities, present or future, actual or contingent, from time to time owing or payable, undertaken, incurred or assumed by the Borrower or any other Security Party to the Facility Beneficiaries (or any of them) under or pursuant to this Agreement and the other Facility Documents and includes (without limitation) the Hedging Secured Obligations.

Facility Secured Obligations Discharge Date means the last day of the Facility Security Period.

Facility Secured Property means (i) the security, powers, rights, titles, benefits and interests (both present and future, actual or contingent) constituted by and conferred upon the Facility Beneficiaries or any of them under or pursuant to the Facility Security Documents and any notices or acknowledgements or undertakings given in respect of or in connection with any of the Facility Security Documents (including, without limitation, the benefit of all covenants, undertakings, representations, warranties and obligations given, made or undertaken to any Facility Beneficiary in the Facility Security Documents and any notices or acknowledgements or undertakings given in respect of or in connection with any of the Facility Security Documents), (ii) all moneys and other assets paid or transferred to or vested in any Facility Beneficiary or any agent of any Facility Beneficiary or any Insolvency Official or received or recovered by any Facility Beneficiary or any agent of any Facility Beneficiary or any Insolvency Official pursuant to, or in connection with, any of the Facility Security Documents and any notices or acknowledgements or undertakings given in respect of or in connection with any of the Facility Security Documents, whether from any Security Party, any Project Counterparty or any other person, and (iii) all moneys, investments, and other assets at any time representing or deriving from any of the foregoing, including all interest, income and other sums at any time received or receivable by any Facility Beneficiary or any agent of any Facility Beneficiary or any Insolvency Official in respect of the same (or any part thereof).

Facility Security Documents means together:

(a)

the Mortgage;

(b)

the Borrower Share Pledge;

(c)

the Account Charge;

(d)

the Assignment;

(e)

the Deed of Covenants;

(f)

the Bareboat Charterer Assignment;

(g)

the Notices of Assignment;

(h)

the Borrower Security Power of Attorney;

(i)

the Bareboat Charterer Security Power of Attorney;

(j)

the Bareboat Charterer Account Charge;

(k)

the Manager Undertaking (if any);

(l)

the Master Agreement Charge; and

(m)

each other document which the Borrower and the Facility Security Trustee agree shall be a Facility Security Document for the purposes of the Facility Documents,

(each a Facility Security Document).

Facility Security Period means the period commencing on the date of this Agreement and terminating on the date on which all of the Facility Secured Obligations have been paid, repaid, satisfied, performed and discharged irrevocably and unconditionally in full.

Facility Security Rights means any rights to enforce the Security Interest constituted by any Facility Document.

Facility Security Trustee means Citibank N.A., London Branch acting through its head office at Citigroup Centre, Canada Square, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ in its capacity as security trustee on behalf of the Facility Beneficiaries for the purposes of the Facility Documents or such other person as may be appointed facility security trustee pursuant to clause 15.21 of this Agreement.

FATCA means:

(a)

sections 1471 to 1474 of the US Internal Revenue Code of 1986 (the Code) or any associated regulations or other official guidance;

(b)

any treaty, law, regulation or other official guidance enacted in any other jurisdiction, or relating to an intergovernmental agreement between the US and any other jurisdiction, which (in either case) facilitates the implementation of paragraph (a) above; or

(c)

any agreement pursuant to the implementation of paragraphs (a) or (b) above with the US Internal Revenue Service, the US government or any governmental or taxation authority in any other jurisdiction.

FATCA Application Date means:

(a)

in relation to a “withholdable payment” described in section 1473(1)(A)(i) of the Code (which relates to payments of interest and certain other payments from sources within the US), 1 July 2014;

(b)

in relation to a “withholdable payment” described in section 1473(1)(A)(ii) of the Code (which relates to “gross proceeds” from the disposition of property of a type that can produce interest from sources within the US), 1 January 2017; or

(c)

in relation to a “passthru payment” described in section 1471(d)(7) of the Code not falling within paragraphs (a) or (b) above, 1 January 2017,

or, in each case, such other date from which such payment may become subject to a deduction or withholding required by FATCA as a result of any change in FATCA after the date of this Agreement.

FATCA Deduction means a deduction or withholding from a payment under a Facility Document required by FATCA.

FATCA Exempt Party means a Party that is entitled to receive payments free from any FATCA Deduction.

FATCA FFI means a foreign financial institution as defined in section 1471(d)(4) of the Code which, if any Facility Beneficiary is not a FATCA Exempt Party, could be required to make a FATCA Deduction.

Fee Letters means any letters entered into by reference to this Agreement in relation to any fees and Fee Letter means any one of them.

Final Disposition means the completion of the sale of the Vessel (or any part thereof) against payment in cash, whether through an agent on its behalf or otherwise, or of all the Borrower’s rights, title and interest in and to the Vessel (or the relevant part), on terms that such right, title and interest will only pass to the purchaser on payment in full of that cash.

Final Disposition Proceeds means the aggregate amount of:

(a)

all cash consideration received upon, or as a result of, the Final Disposition of the Vessel; and

(b)

any non-refundable deposit paid by a person acquiring or proposing to acquire the Vessel under a contract or offer to purchase, or otherwise acquire the Vessel which has been withdrawn, terminated or cancelled or has lapsed.

Financial Guarantee means the guarantee entered into or to be entered into by the Sponsor in favour of the Facility Security Trustee referring to the Facility Secured Obligations, in the Agreed Form.

Fixed Rate means, in relation to a Hedging Agreement, the fixed rate of interest by reference to which periodic payments and receipts to be made or received under that Hedging Agreement are calculated.

Flag State means Bahamas or any other state or country in which the Vessel, with the prior written consent of the Facility Security Trustee (acting after consultation with, and on the instructions of, the Facility Lenders and GIEK (but provided that Cyprus, ▇▇▇▇▇▇▇▇ Islands, Norwegian International Ship Register, Liberia, Panama, Isle of Man, Cayman Islands, Bermuda and Singapore are pre-approved)), is from time to time registered in accordance with the provisions of this Agreement, the Assignment and the other Transaction Documents.

GAAP means generally accepted accounting principles in the United States of America.

General Partner means Teekay Offshore GP L.L.C., a limited liability company formed and existing according to the law of the ▇▇▇▇▇▇▇▇ Islands whose registered office is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇-▇▇▇▇▇.

GIEK means Garanti-Instituttet for Eksportkreditt acting through its office at Dronning ▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇ ▇-▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇.

GIEK Agent means Citibank N.A., London Branch or such other person as may be appointed agent for the GIEK Facility Lenders pursuant to clause 15.21 of this Agreement.

GIEK Decisions means waivers, consents or approvals under or pursuant to the Facility Documents which do not have the effect of varying, changing or amending:

(a)

the timing of the Advance (including time periods for notices);

(b)

the Availability Period;

(c)

the Margin;

(d)

the definition of LIBOR or any aspect of the interest rate setting mechanism;

(e)

an Interest Payment Date, an Application Date, an Interest Period or any amount due on or in respect of, such date;

(f)

the currency in which any sum is payable;

(g)

the identity of the Borrower and/or the Sponsor for “Know Your Customer” purposes;

(h)

the amount of, or due date for, any commitment fee; and/or

(i)

the amount of a GIEK Facility Commitment.

unless the approval of all Facility Lenders are required for such waiver, consent or approval, in which case the approval of GIEK is also required.

GIEK Facility means the term loan facility made available by the GIEK Facility Lenders under this Agreement as described in clause 2.

GIEK Facility Advance means an advance of the GIEK Facility Commitments in accordance with clause 4.

GIEK Facility Commitment means:

(a)

in relation to a GIEK Facility Lender at the date of this Agreement, the amount set opposite its name under the heading “GIEK Facility Commitment” in Schedule 1, Part 1 and the amount of any other GIEK Facility Commitment transferred to it under this Agreement; and

(a)

in relation to any other GIEK Facility Lender, the amount of any GIEK Facility Commitment transferred to it under this Agreement,

to the extent not cancelled, reduced or transferred by it under this Agreement.

GIEK Facility Contribution means, in relation to a GIEK Facility Lender, the part of the GIEK Loan which is owing to that GIEK Facility Lender.

GIEK Facility Lenders means:

(b)

the GIEK Facility Lenders set out in Schedule 1, Part 1 of this Agreement; and

(c)

any bank, financial institution or other regulated investment company which has become a party as a GIEK facility lender in accordance with clause 14,

which in each case has not ceased to be a party in accordance with the terms of this Agreement.

GIEK Final Maturity Date means the date falling on the tenth (10^th) anniversary of the Drawdown Date.

GIEK Final Payment means the amount of the GIEK Loan outstanding and owing to the GIEK Facility Lenders as at the GIEK Final Maturity Date.

GIEK Guarantee means the guarantee issued or to be issued in favour of the GIEK Agent and/or the GIEK Facility Lenders pursuant to which GIEK has guaranteed or will guarantee the GIEK Facility Commitment of each GIEK Lender, together with, as the context may require, the “Offer for Guarantee Policy Buyer Credit Guarantee No 300670”, in each case on terms agreed between the GIEK Facility Lenders, the GIEK Agent and GIEK.

GIEK Loan means a loan made or to be made under the GIEK Facility or the principal amount outstanding for the time being of that loan.

GIEK Premium means one point one per cent. (1.1%) per annum of a GIEK Facility Advance or GIEK Facility Loan being payable or (as the context may require) paid to GIEK under the terms of the GIEK Guarantee at the end of each Interest Period.

GIEK Proportionate Share means, at any time prior to the Advance being made, the proportion which a GIEK Facility Lender’s GIEK Facility Commitment then bears to the aggregate GIEK Facility Commitments of all GIEK Facility Lenders and at any time after the Advance has been made, the proportion which a GIEK Facility Lender’s Contribution then bears to the GIEK Loan.

Government Entity means and includes (whether having a distinct legal personality or not) (i) any national or local government authority, (ii) any board, commission, department, division, organ, instrumentality, court or agency of any entity referred to in paragraph (i), however constituted, and (iii) any international association, organisation or institution of which any entity mentioned in paragraph (i) or (ii) above is a member or to whose jurisdiction any such entity is subject or in whose activities any such entity is a participant.

Hedging Agreements means (i) the confirmation or confirmations (if any) for the purposes of managing the interest rate risk under the Facility (including, but not limited to, swaptions, options and interest caps), and/or (ii) the International Swaps and Derivatives Association Master Agreement (the Master Agreement) entered into or, as the context may require, to be entered into, in each case, between the Hedging Providers (or any of them) as interest hedging provider or, as the case may be, swap provider and the Borrower as counterparty and includes any schedule to that Master Agreement and any confirmation issued under that Master Agreement, and includes any replacement or amendment thereof approved by the Facility Lenders in accordance with clause 12.1.29 of this Agreement.

Hedging Providers means:

(a)

each bank or financial institution that becomes a party to this Agreement in its capacity as a Hedging Provider by way of Transfer Certificate or Accession Deed; and which in each case

(b)

is party to a Hedging Agreement,

(each a Hedging Provider).

Hedging Secured Obligations means all monies, obligations and liabilities, present or future, actual or contingent, from time to time owing or payable, undertaken, incurred or assumed by the Borrower or any other Security Party to any Hedging Provider under or pursuant to the Hedging Agreements and the other Facility Documents (for the avoidance of doubt, without prejudice to and after giving effect to any contractual set off and/or netting provisions contained in that Hedging Agreement and including, without limitation, any Swap Payments and/or termination sums).

Hiload Eligible Costs means the costs, expressed in Dollars, incurred by any member of the TOO Group for the project involving the unit known as the “HiLoad DP No. 1 Unit” which constitute Norwegian content up to an amount confirmed by GIEK.

Holding Company means, in relation to an entity, any other entity in respect of which the first is a Subsidiary.

Hull Cover Ratio means at any time:

(a)

the amount of the latest Valuation delivered in accordance with clause 12.1.37;

(b)

divided by the Loan outstanding at that time;

(c)

multiplied by one hundred; and

(d)

then expressed as a percentage.

Indebtedness means any obligation for the payment or repayment of money, whether as principal or as surety and whether present or future, actual or contingent.

Indemnified Parties shall have the meaning given to that term in clause 8.10 of this Agreement (each an Indemnified Party).

Insolvency Event means, in relation to any person, the occurrence of any of the following events:

(a)

Insolvency: that person is unable to pay its debts as they fall due or admits its inability to pay its debts as they mature or suspends or threatens to suspend making payment of all or a substantial part of its Indebtedness or makes a general assignment or assignation for the benefit of creditors or is subject to or applies for winding-up or liquidation proceedings or is successfully put into forced or voluntary liquidation (except for the purposes of a voluntary reorganisation not involving the insolvency of that person and previously agreed in writing by the Facility Agent acting in accordance with the instructions of the Majority Facility Lenders);

(b)

Winding up: any order is made, petition is presented, resolution is passed or other act or action is taken for the winding-up, liquidation, administration or other formal insolvency of that person under any Applicable Law, whether now or hereafter in effect (save where the petition presented is frivolous or vexatious and is dismissed within a period of thirty (30) days);

(c)

Appointment of receivers and managers: any administrative or other receiver is appointed of that person or any substantial part of its assets or any other steps (except for any frivolous or vexatious step or steps which are dismissed within a period of thirty (30) days) are taken to enforce any Security Interest over all or any material part of the assets of that person;

(d)

Seizure: other than the Vessel, all or a substantial part of the assets of that person are seized, nationalised, expropriated or compulsorily acquired by or under the authority of any Government Entity provided that in respect of any person other than TOO, such seizure, nationalisation, expropriation or acquisition has not been reversed within thirty (30) days;

(e)

Analogous proceedings: there occurs, in relation to that person in any jurisdiction, any event which corresponds with, or has an effect equivalent or similar to, any of the events mentioned in the foregoing paragraphs.

Insolvency Official in respect of any person, means any liquidator, receiver, administrator and/or manager or administrative receiver, judicial manager, trustee or similar officer appointed in respect of that person, whether appointed by a creditor, pursuant to any statute, by a court or other tribunal or otherwise, for the purpose of recovering, realising, distributing or disposing of any of the assets or undertaking of that person.

Insurance Proceeds means the proceeds of any Insurances other than Total Loss Proceeds and Liability Insurance Proceeds.

Insurances means all policies and contracts of insurance which expression includes all entries of the Vessel in a protection and indemnity or war risks association which are from time to time taken out or entered into in respect of or in connection with the Vessel or her increased value and all benefits under such contracts and policies including all claims of any nature and returns of a premium.

Interest Payment Date means the last day of an Interest Period.

Interest Period means each period for the calculation of interest in respect of that Advance or the Loan ascertained in accordance with clause 7 of this Agreement.

Interpolated Screen Rate means, in relation to LIBOR for a particular period, the rate (rounded upwards to the same number of decimal places as the Screen Rates referred to below) which results from interpolating on a linear basis between:

(a)

the applicable Screen Rate for the longest period (for which that Screen Rate is available) which is less than the Interest Period; and

(b)

the applicable Screen Rate for the shortest period (for which that Screen Rate is available) which exceeds the Interest Period,

each as of 11:00 a.m. London time two (2) London Banking Days before the first day of the relevant Interest Period for the offering of the deposits in Dollars in an amount comparable to the Loan (or any other relevant part of the Loan) and, if that rate is less than zero, it shall be deemed to be zero.

ISM Code means the International Safety Management Code for the Safe Operation of Ships and for Pollution Prevention constituted pursuant to Resolution A.741(18) of the International Maritime Organisation and incorporated into the Safety of Life at Sea Convention, and includes any amendment of the foregoing and any regulation issued pursuant to the foregoing.

ISPS Code means the International Ship and Port Facility Security Code of the International Maritime Organisation and includes any amendments or extensions thereto and any regulation issued pursuant thereto.

ISS means, if and whenever the same is required by Applicable Law and/or pursuant to or for the purposes of the Insurances, the International Ship Security Certificate for the Vessel issued in accordance with the ISPS Code.

Letter of Undertaking means the letter of undertaking between the Borrower, TOO and the Facility Agent.

Liability Insurance Proceeds means:

(a)

the proceeds of the Insurances received in respect of protection and indemnity risks or collision liability;

(b)

any amounts paid by the Charterer to the Bareboat Charterer or any other person under or pursuant to the Charter as an indemnity for third party operational or liability claims of any nature; and

(c)

any amounts paid by the Manager to the Bareboat Charterer or any other person under or pursuant to the Management Agreement as an indemnity for third party operational or liability claims of any nature.

LIBOR means, in relation to a particular period:

(a)

the applicable Screen Rate; or

(b)

if no Screen Rate is available for any Interest Period, the Interpolated Screen Rate; or

(c)

if no Screen Rate is available for any Interest Period and it is not possible to calculate an Interpolated Screen Rate for that Interest Period, the Reference Bank Rate,

at, in the case of paragraphs (a) and (c) above, 11.00 a.m. London time two (2) London Banking Days before the first day of the relevant Interest Period for the offering of deposits in Dollars in an amount comparable to the Loan (or any other relevant part of the Loan) and for a period comparable to the relevant Interest Period provided always that if that rate is less than zero, LIBOR shall be deemed to be zero.

Loan means the GIEK Loan and the Commercial Loan and Loans means all of them.

London Banking Day means a day (other than Saturday or Sunday) on which banks are open for normal banking business in London.

Loss Payable Clause means the provisions regulating the manner of payment of sums receivable under the Insurances which are to be incorporated in the relevant insurance documents, such Loss Payable Clause to be in the form set out in Appendix C to the Assignment or in such other form as may from time to time be reasonably required by the Facility Security Trustee acting on the instructions of the Majority Facility Lenders.

Losses means all losses, liabilities, costs, charges, expenses, damages and outgoings of whatsoever nature (including without limitation, Taxes (but excluding taxes levied on the overall income or profits of any Facility Beneficiary in the jurisdiction in which its principal or Facility Office under the Facility Documents is located), stamp duties and other duties or charges, registration fees, repair costs, insurance premiums, fees of insurance advisers reasonably incurred, fees of technical consultants, printing costs, out-of-pocket expenses and fees and disbursements of legal counsel reasonably incurred, together with any value added or similar tax payable in respect thereof) but excluding, for the avoidance of doubt, any loss of profits.

Majority Facility Lenders means, together, at any relevant time, (i) the Facility Lenders the aggregate of whose Contributions equal or exceed sixty-six and two-thirds per cent. (66.67%) of the Loan at that time, or (ii) if no Advance has been made, the Facility Lenders the aggregate of whose Commitments at that time equal or exceed sixty-six and two-thirds per cent. (66.67%) of the Total Commitments at that time or, if all of the Commitments have been reduced to zero at or prior to that time, the Facility Lenders the aggregate of whose Contributions immediately prior to that reduction equalled or exceeded sixty-six and two-thirds per cent. (66.67%) of the Loan at that time.

Majority GIEK Facility Lenders means, together, at any relevant time, (i) the GIEK Facility Lenders the aggregate of whose Contributions relating to the GIEK Loan equal or exceed sixty-six and two-thirds per cent. (66.67%) of the GIEK Loan at that time, or (ii) if no Advance has been made, the Facility Lenders the aggregate of whose GIEK Facility Commitments at that time equal or exceed sixty-six and two-thirds per cent. (66.67%) of the Total GIEK Facility Commitments at that time or, if all of the GIEK Facility Commitments have been reduced to zero at or prior to that time, the GIEK Facility Lenders the aggregate of whose Contributions relating to the GIEK Loan immediately prior to that reduction equalled or exceeded sixty-six and two-thirds per cent. (66.67%) of the GIEK Loan at that time.

Management Agreement means the management agreement and/or arrangements between the Bareboat Charterer and/or the Borrower and the Manager in relation to the Vessel.

Manager means (a) Teekay Shipping Limited, a company incorporated under the laws of Bermuda with its registered office at 4^th Floor, Belvedere ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇, ▇▇▇▇▇▇▇, (▇) another company in the TOO Group or the Teekay Group, or (c) another person acceptable to the Facility Agent (acting on the instructions of all the Facility Lenders and GIEK, acting reasonably) which has become a party to a Management Agreement.

Manager Undertaking means the undertaking of the Manager which is not a member of either the TOO Group or Teekay Group, in favour of the Facility Security Trustee in the form scheduled to the Deed of Covenants.

Mandated Lead Arrangers means the banks listed in Schedule 1, Part 2 of this Agreement.

Margin means:

(a)

in relation to the GIEK Facility, zero point nine per cent (0.90%) per annum; and

(b)

in relation to the Commercial Facility, two per cent (2.00%) per annum.

Master Agreement Charge means the first priority charge in respect of the Hedging Agreements executed or, as the context may require, to be executed, by the Borrower in favour of the Facility Security Trustee, in the Agreed Form.

Material Adverse Effect means a material adverse change in, or a material adverse effect on:

(a)

the financial conditions, assets, prospects or business of any Security Party or on the consolidated financial condition, assets, prospects or business of the TOO Group;

(b)

the ability of any Security Party to perform and comply with its obligations under the Facility Document or Project Document or to avoid any Event of Default;

(c)

the validity, legality or enforceability of any Facility Document or Project Document; or

(d)

the validity, legality or enforceability of any security expressed to be created pursuant to any Facility Document or Project Document or the priority and ranking of any such security,

provided that, in determining whether any of the foregoing circumstances shall constitute such a material adverse change or material adverse effect for the purposes of this definition, the Facility Beneficiaries shall consider such circumstance in the context of (x) the TOO Group taken as a whole and (y) the ability of the Security Parties to perform each of their obligations under the Facility Documents and Project Documents.

month means a period starting on one day in a calendar month and ending on the numerically corresponding day in the next calendar month, except that (i) if there is no numerically corresponding day in the calendar month in which that period is to end, that period shall end on the last Banking Day in that calendar month and (ii) if the numerically corresponding day is not a Banking Day, that period shall end on the next Banking Day in that calendar month in which that period is to end if there is one, or if there is not, on the immediately preceding Banking Day, and months and monthly shall be construed accordingly.

Mortgage means the first priority mortgage over the Vessel executed or to be executed by the Borrower in favour of the Facility Security Trustee and registered or to be registered against the Vessel in accordance with all Applicable Laws in the Flag State, in the Agreed Form.

Necessary Authorisations means all Authorisations of any person including any government or other regulatory authority required by Applicable Law to enable it to:

(a)

lawfully enter into and perform its obligations under the Facility Documents to which it is party;

(b)

ensure the legality, validity, enforceability or admissibility in evidence in England, the governing law of such document and, if different, its jurisdiction of incorporation, of such Facility Documents to which it is party; and

(c)

carry on its business from time to time.

Notices of Assignment means each notice and (where applicable) corresponding acknowledgment of assignment in the form set out in the relevant Appendix (Notices of Assignment) to the Assignment, each other notice and (where applicable) corresponding acknowledgment of assignment issued pursuant to the Assignment and/or the Bareboat Charterer Assignment and/or the Master Agreement Charge and each notice of assignment and (where applicable) corresponding acknowledgement of assignment issued pursuant to each other Facility Security Document.

Notified Lender has the meaning given to it in clause 7.8.2(b) of this Agreement.

Original Schedule of Repayment Amounts means Schedule 5 to this Agreement.

Payment Direction Letter means the payment direction letter between the Borrower, TOO and the Facility Agent.

Party means a party to this Agreement.

Permitted Amendment means any amendment permitted pursuant to the terms of the Facility Documents.

Permitted Liens means:

(a)

any repairer’s or outfitter’s possessory lien for a sum in aggregate at any time not (except with the prior written consent of the Facility Agent) exceeding ten million Dollars ($10,000,000);

(b)

any lien on the Vessel for master’s, officer’s or crew’s wages arising in accordance with usual maritime practice which are not overdue; and

(c)

any lien for salvage,

(each a Permitted Lien).

Permitted Security Interest means:

(a)

any Security Interest created by the Facility Security Documents and any set-off rights granted under the Hedging Agreements;

(b)

any lien arising in the ordinary course of business or operation of the Vessel by statute or by operation of law in respect of obligations which are not more than thirty (30) days overdue or which are being contested in good faith by appropriate proceedings (and for the payment of which adequate reserves have been provided) so long as any such proceedings or the continued existence of such lien do not in the opinion of the Facility Agent involve any likelihood of the sale, forfeiture or loss of, or of any interest in, the Vessel or any Total Loss Proceeds;

(c)

any Security Interest arising out of any claims, judgments, or awards against a Security Party which are being contested in good faith by that Security Party or which are the subject of a pending appeal (and for the payment of which adequate reserves have been provided) so long as any such claims, judgments or awards or the continued existence of such Security Interest do not in the reasonable opinion of the Facility Agent involve any likelihood of the sale, forfeiture or loss of, or of any interest in, the Vessel or any Total Loss Proceeds; and

(d)

any Permitted Lien.

Proceeds means:

(a)

all Final Disposition Proceeds of the type referred in paragraph (a) of that definition;

(b)

all Total Loss Proceeds and all Restricted Proceeds;

(c)

all Requisition Compensation; and

(d)

all and any other monies, property and other assets representing or deriving from all or any of the Facility Secured Property and the Collateral.

Project Counterparties means together:

(a)

the Charterer;

(b)

the Manager; and

(c)

each other person who may from time to time replace any of the parties referred to above as party to any of the Project Documents,

(each a Project Counterparty).

Project Documents means:

(a)

the Management Agreement;

(b)

the Charter;

(c)

the Bareboat Charter;

(d)

the Building Contract; and

(e)

any change orders or other deed, document, agreement or instrument amending, varying, supplementing, ratifying, confirming, extending or renewing any of the foregoing documents or any of the terms and conditions thereof or consenting to the amendment or variation of the terms and conditions thereof,

(each a Project Document).

Proportionate Share means, at any time prior to the Advance being made, the proportion which a Facility Lender’s Commitment then bears to the aggregate Commitments of all the Facility Lenders being on the date of this Agreement the percentage indicated against the name of that Facility Lender in Schedule 1 of this Agreement, and at any time after the Advance has been made, the proportion which a Facility Lender’s Contribution then bears to the Loan.

Receiver means and includes any receiver and/or manager and/or receiver and manager of the Facility Secured Property or any part thereof appointed under or pursuant to any Facility Document (and whether acting as agent for any Facility Beneficiary or otherwise).

Reference Banks means in relation to LIBOR, any three (3) banks or financial institutions acceptable to the Facility Agent and the Borrower.

Reference Bank Rate means the arithmetic mean of the rates (rounded upwards to four decimal places) as supplied to the Facility Agent at its request by the Reference Banks as the rate at which the relevant Reference Bank could borrow funds in the London interbank market, in the relevant currency and for the relevant period, were it to do so by asking for and then accepting interbank offers for deposits in reasonable market size in that currency and for that period.

Repayment Amount means, in relation to any Application Date, the amount set out in the Schedule of Repayment Amounts in relation to that Application Date.

Replacement Schedule of Repayment Amounts means any replacement Schedule of Repayment Amounts calculated by the Facility Agent in accordance with clause 5.3 of this Agreement.

Requisition Compensation means all sums of money or other compensation from time to time payable during the Facility Security Period by reason of the Compulsory Acquisition of the Vessel.

Restatement means an amendment and restatement of the Facility Documents to finance Rig 2 and/or Rig 3 under or pursuant to this Agreement.

Restricted Proceeds means any Insurance Proceeds if the full amount of the same exceeds the Casualty Amount.

Revenue means all moneys whatsoever from time to time due or payable to the Borrower arising out of the use or operation of the Vessel including (but without limiting the generality of the foregoing) all Charter Rate, freight, hire and passage moneys, moneys arising under any charter contract, time charter or other agreement between it and any operator, income, income arising under pooling arrangements, compensation payable to the Borrower in the event of requisition of the Vessel for hire, remuneration for salvage and towage services, demurrage and detention moneys, and damages for breach of any such charterparty or other contract for the employment of the Vessel.

Rig 2 means the floating accommodation unit with hull number N381 currently under construction with the Builder.

Rig 3 means the floating accommodation unit with hull number N675 currently under construction with COSCO (Qidong) Offshore Co., Ltd.

Schedule of Repayment Amounts means at any time the Original Schedule of Repayment Amounts or, if at such time a Replacement Schedule of Repayment Amounts has been substituted therefor pursuant to and in accordance with clause 5.3 of this Agreement, the latest Replacement Schedule of Repayment Amounts.

Screen Rate means in relation to LIBOR, the ICE Benchmark Administration Limited Interest Settlement Rate for the relevant currency and period displayed on the appropriate page of the Reuters page LIBOR 01 (or such other page or pages or service which replace(s) such page or service for the purposes of displaying offered rates of leading banks) (before any correction, recalculation or republication by the administrator) for deposits in Dollars.

Secured Property means (i) the security, powers, rights, titles, benefits and interests (both present and future, actual or contingent) constituted by and conferred upon the Facility Beneficiaries or any of them under or pursuant to the Facility Documents and any notices or acknowledgements or undertakings given in respect of or in connection with any of the Facility Documents (including, without limitation, the benefit of all covenants, undertakings, representations, warranties and obligations given, made or undertaken to any Facility Beneficiary in the Facility Documents and any notices or acknowledgements or undertakings given in respect of or in connection with any of the Facility Documents), (ii) all moneys and other assets paid or transferred to or vested in any Facility Beneficiary or any agent of any Facility Beneficiary or any Insolvency Official or received or recovered by any Facility Beneficiary or any agent of any Facility Beneficiary or any Insolvency Official pursuant to, or in connection with, any of the Facility Documents and any notices or acknowledgements or undertakings given in respect of or in connection with any of the Facility Documents, whether from any Security Party, any Project Counterparty or any other person, and (iii) all moneys, investments, and other assets at any time representing or deriving from any of the foregoing, including all interest, income and other sums at any time received or receivable by any Facility Beneficiary or any agent of any Facility Beneficiary or any Insolvency Official in respect of the same (or any part thereof).

Security means any Security Interest created or purported to be created by any of the Facility Security Documents.

Security Interest means any mortgage, charge (whether fixed or floating), pledge, lien, hypothecation, assignment by way of security, trust arrangement for the purpose of providing security or other security interest of any kind securing any obligation of any person or any other arrangement having the effect of conferring rights of retention or set-off (but excluding any right of set-off arising in favour of a banker prior to such right becoming exercisable) or other disposal rights over an asset (including without limitation title transfer and/or retention arrangements having a similar effect) and includes any agreement to create any of the foregoing but does not include liens arising in the ordinary course of trading by operation of law and not by way of contract.

Security Parties means the Borrower, the Bareboat Charterer, the Manager, the Sponsor, the Shareholder and any other party which the Borrower and the Facility Security Trustee agree (after the date of this Agreement) shall be a Security Party but excluding the Charterer (each a Security Party).

Shareholder means Logitel Offshore Pte. Ltd. of ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ #▇▇-▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇.

SMC means a valid safety management certificate issued for the Vessel by or on behalf of the Administration under paragraph 13.7 of the ISM Code.

Sponsor means TOO.

Subsidiary means any company or entity directly or indirectly controlled by another person, for which purpose control means either ownership of more than fifty per cent. (50%) of the voting share capital (or equivalent right of ownership) of such company or entity or power to direct its policies and management whether by contract or otherwise.

Swap Payment means, in relation to a Hedging Agreement and an Interest Payment Date, the amount (if any) payable by the Borrower under and pursuant to that Hedging Agreement on that Interest Payment Date in respect of the difference between interest calculated at the Fixed Rate applicable under that Hedging Agreement and interest calculated at the floating rate then applicable under that Hedging Agreement in respect of the Interest Period ending on that Interest Payment Date (after giving effect to any contractual set-off and/or netting provisions contained in that Hedging Agreement), but shall exclude, for the avoidance of doubt, any amount payable by the Borrower under that Hedging Agreement as a result or consequence of any termination of, or default under, that Hedging Agreement.

Taxes includes all present and future taxes, levies, imposts, duties, fees or charges of a similar nature together with interest thereon and penalties in respect thereof, and Tax and Taxation shall be construed accordingly.

Teekay means Teekay Corporation, a corporation domesticated according to the law of the ▇▇▇▇▇▇▇▇ Islands whose registered office is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇-▇▇▇▇▇.

Teekay Group means Teekay and each of its Subsidiaries.

TOO means Teekay Offshore Partners L.P., a master limited partnership formed and existing according to the law of the ▇▇▇▇▇▇▇▇ Islands whose registered office is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, The ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇-▇▇▇▇▇.

TOO Group means TOO and each of its Subsidiaries.

Total Commercial Facility Commitments means the aggregate of the Commercial Facility Commitments, being thirty three million Dollars ($33,000,000) as at the date of this Agreement.

Total Commitments means the Total GIEK Facility Commitments and the Total Commercial Facility Commitments.

Total GIEK Facility Commitments means the aggregate GIEK Facility Commitments, being one hundred and seventeen million Dollars ($117,000,000) as at the date of this Agreement.

Total Loss means:

(a)

the actual, constructive, arranged, agreed or compromised total loss of the Vessel; or

(b)

the requisition for title or compulsory acquisition, nationalisation or expropriation of the Vessel by or on behalf of any government or other authority (other than by way of requisition for hire);

(c)

the capture, seizure, arrest, detention, hijacking, theft or confiscation of the Vessel unless the Vessel is released and returned to the possession of the Borrower or the Bareboat Charterer within ninety (90) days after the capture, seizure, arrest, detention or confiscation in question.

Total Loss Proceeds means any proceeds of the Insurances arising in respect of a Total Loss and any Requisition Compensation received in respect of a Compulsory Acquisition.

Transaction Documents means the Facility Documents and the Project Documents (each a Transaction Document).

Transfer Certificate means a certificate substantially in the terms of Schedule 5 to this Agreement.

Transfer Date means, in relation to any Transfer Certificate, the date of the making of the transfer specified in the schedule to such Transfer Certificate.

Unpaid Sum means any sum due and payable but unpaid by a Security Party under the Facility Documents.

Unrestricted Proceeds means all Insurance Proceeds other than Restricted Proceeds.

Valuation means one written valuation of the Vessel expressed in Dollars prepared by one of the Approved Brokers (or such other firm of reputable independent shipbrokers as may be acceptable to the Majority Facility Lenders and GIEK (acting reasonably)). Such valuation shall be prepared at the Borrower’s expense (unless no Default has occurred and such valuation is requested by the Facility Agent more frequently than once per financial year, in which case it shall be prepared at the Facility Lenders’ expense), without a physical inspection, on the basis of a sale for prompt delivery for cash at arm’s length between a willing buyer and a willing seller without the benefit of any charterparty or other engagement on an open market basis.

Vessel means the floating accommodation unit with hull number N380 as more particularly described in the Charter and any and all appliances, spare parts, accessories, fittings, instruments, machinery, components, equipment and other facilities or materials allocated to, appropriated for, installed in, attached to or otherwise relating thereto.

Vessel Total Costs means the costs, expressed in Dollars, incurred by the Borrower or any Affiliate of TOO or of Teekay for the project involving the Vessel, being the costs referred to in Schedule 7.

Schedule 7

Vessel Total Costs


Item	Dollars ($)
Construction Contract		179,500,000
Mobilisation Cost		19,800,000
Hull Value		20,500,000
Vessel Total Cost		219,800,000

Schedule 8

Form of Accession Deed

To: [ ] as Facility Agent for and on behalf of the Facility Beneficiaries

From: [New Hedging Provider] (the New Hedging Provider)

Dated:

Dear Sirs

ACCESSION DEED

We refer to the secured loan facility agreement (as from time to time amended, varied, supplemented or novated the Loan Agreement) dated [●] 2015. This deed (the Accession Deed) shall take effect as an Accession Deed for the purposes of the Loan Agreement. Terms defined in the Loan Agreement have the same meaning in this Accession Deed unless given a different meaning in this Accession Deed.

2	The New Hedging Provider agrees to become a Hedging Provider and to be bound by the terms of the Loan Agreement and the other Facility Documents as a Hedging Provider.

3	The New Hedging Provider agrees to provide a copy of the Hedging Agreement to which it is a party to the Facility Agent.

4	The New Hedging Provider’s administrative details for the purposes of the Loan Agreement are as follows:

Address:

Fax No.:

Attention:

IT IS AGREED as follows:

(a)

The New Hedging Provider and each of the Facility Beneficiaries agree that the Facility Security Trustee shall hold:

(i)

any Security in respect of Facility Secured Obligations created or expressed to be created pursuant to the Facility Documents; and

(ii)

all proceeds of that Security;

on trust for the Facility Beneficiaries (including the New Hedging Provider) on the terms and conditions contained in the Loan Agreement.

(b)

The New Hedging Provider appoints the Facility Agent as its agent and the Facility Security Trustee as its facility security trustee on the terms of, and in accordance with, clause 15 of the Loan Agreement.

The New Hedging Provider acknowledges that pursuant to the Master Agreement Charge, it has received notice that the Borrower has assigned and charged its rights, title and interest in and to the Hedging Agreements in favour of the Facility Security Trustee acting on behalf of the Facility Beneficiaries and agrees to comply with the instructions contained in the notice attached to the Master Agreement Charge.

6	This Accession Deed is a Facility Document.

7	This Accession Deed and any non-contractual obligations arising out of or in connection with it are governed by, and shall be construed in accordance with, English law.

THIS ACCESSION DEED has been signed on behalf of the Facility Agent and executed as a deed by [New Hedging Provider] and is delivered on the date stated above.

New Hedging Provider


EXECUTED as a DEED		)

By: [New Hedging Provider]		)

Witnessed by:

Facility Agent

EXECUTED as a DEED		)

By: [Facility Agent]		)

Witnessed by:

Schedule 9

Additional Facility Principles

1	Each of the Additional Facility and this Facility will be cross-collateralised (with the same priority), with the Facility Security Documents amended and/or released and retaken to secure the obligations under the Additional Facility;

2	An Event of Default will occur under this Facility if an event of default occurs under the Additional Facility, and vice versa;

3	The parties to the Additional Facility (other than any member of the TOO Group or Teekay Group) will appoint (i) the Facility Security Trustee as its trustee to hold the secured property under the Additional Facility and (ii) the Facility Agent as its agent under the Additional Facility;

All amounts received pursuant to the Facility Security Documents and the Additional Facility shall be applied against the amounts due to each Facility Beneficiary (other than the Hedging Providers) and each facility beneficiary under the Additional Facility (other than hedging providers) on a pari passu basis;

5	The intercreditor agreement to be entered into pursuant to clause 12.1.38(b) shall also include the following provisions:

(a)

Prior to an event of default:

(i)

Subject to as otherwise provided herein, payments are made/distributed under this Facility and/or the Additional Facility in accordance with their terms;

(ii)

The Facility Lenders take decisions under the Facility and the lenders take decisions under this Additional Facility, unless those decisions affect the Security Interests for the facility and the Additional Facility or the rights in those Security Interests, in which case those decisions are taken by the Facility Lenders under this Facility and the lenders under the Additional Facility;

(iii)

Subject to the paragraph (iv) directly below relating to prepayments of this Facility or the Additional Facility in full, any voluntary prepayments and cancellations shall be applied towards the obligations under this Facility and the Additional Facility on a pro rata and pari passu basis;

(iv)

If this Facility or the Additional Facility is fully prepaid, the Vessel, Rig 2 and/or Rig 3 which that facility financed and its owner, as the case may be, shall be released provided that if this Facility is fully prepaid, there shall be a corresponding prepayment of the Additional Facility, to ensure that the loans outstanding under the Additional Facility are at a loan to value ratio acceptable to the lenders (and any export credit agency) under the Additional Facility, after taking into account any charter on Rig 2 and Rig 3;

(v)

The decision to give notice of an Event of Default and/or an event of default under the Additional Facility would require the vote of the Majority Facility Lenders and the majority lenders under the Additional Facility.

(b)

Upon an event of default under the Additional Facility, the decision to accelerate/enforce security (Enforcement Event) or to waive the event of default is taken by a quota of Facility Lenders for the Facility and lenders the Additional Facility taken together.

(c)

After an Enforcement Event:

(i)

Proceeds of the Security Interests from the Facility and/or the Additional Facility are applied towards the obligations under the Facility and the Additional Facility on a pro rata and pari passu basis;

(ii)

Any income received other than from the realisation of Security Interests, such as Earnings are applied towards the obligations under the Facility and the Additional Facility on a pro rata and pari passu basis; and

(iii)

Decisions are taken by the relevant quota of the Facility Lenders and the lenders in the Additional Facility.

IN WITNESS of which the parties to this Agreement have executed this Agreement the day and year first before written.


Borrower

SIGNED by	)	Emeline Yew Attorney in fact
duly authorised for and on behalf	)
of LOGITEL OFFSHORE RIG I PTE. LTD.	)

Commercial Facility Lenders SIGNED by ▇▇▇▇▇▇ ▇▇▇▇▇▇ duly authorised for and on behalf of CITIBANK N.A., LONDON BRANCH	) ) )

GIEK Facility Lenders

SIGNED by ▇▇▇▇▇▇ ▇▇▇▇▇▇ duly authorised for and on behalf of CITIBANK N.A., LONDON BRANCH	) ) )

SIGNED by ▇▇▇▇▇▇ ▇▇▇▇▇▇	)
duly authorised for and on behalf	)
of KOMMUNAL	)
LANDSPENSJONSKASSE, GJENSIDIG	)
FORSIKRINGSSELSKAP.	)

Facility Agent SIGNED by ▇▇▇▇▇▇ ▇▇▇▇▇▇ duly authorised for and on behalf of CITIBANK INTERNATIONAL LIMITED	) ) )

Facility Security Trustee

SIGNED by ▇▇▇▇▇▇ ▇▇▇▇▇▇	)
duly authorised for and on behalf	)
of CITIBANK N.A., LONDON BRANCH	)

GIEK Agent SIGNED by ▇▇▇▇▇▇ ▇▇▇▇▇▇ duly authorised for and on behalf of CITIBANK N.A., LONDON BRANCH	) ) )

Mandated Lead Arrangers SIGNED by ▇▇▇▇▇▇ ▇▇▇▇▇▇ duly authorised for and on behalf of CITIBANK N.A., LONDON BRANCH	) ) )