COSTAMARE INC. - and - COSTAMARE SHIPPING COMPANY S.A. MANAGEMENT AGREEMENT

Exhibit 10.1

- and -

COSTAMARE SHIPPING COMPANY S.A.

TABLE OF CONTENTS


		Page


ARTICLE I INTERPRETATION		1
ARTICLE II APPOINTMENT		5
ARTICLE III THE PARENT’S GENERAL OBLIGATIONS		7
ARTICLE IV THE MANAGER’S GENERAL OBLIGATIONS		8
ARTICLE V ADMINISTRATIVE SERVICES		10
ARTICLE VI COMMERCIAL SERVICES		13
ARTICLE VII INSURANCE		13
ARTICLE VIII AVAILABILITY OF OFFICERS AND EMPLOYEES		14
ARTICLE IX MANAGEMENT FEES AND EXPENSES		14
ARTICLE X BUDGETS, CORPORATE PLANNING AND EXPENSES		18
ARTICLE XI LIABILITY AND INDEMNITY		20
ARTICLE XII RIGHTS OF THE MANAGER AND RESTRICTIONS ON THE MANAGER’S AUTHORITY		21
ARTICLE XIII TERMINATION OF THIS AGREEMENT		23
ARTICLE XIV NOTICES		25
ARTICLE XV APPLICABLE LAW		26
ARTICLE XVI ARBITRATION		26
ARTICLE XVII MISCELLANEOUS		27

APPENDIX I	Form of Shipmanagement Agreement
APPENDIX II	Form of Supervision Agreement

-i-

THIS MANAGEMENT AGREEMENT (this “Agreement”) is made on the day of November, 2010, BY AND BETWEEN:

(1) COSTAMARE INC., a company organized and existing under the laws of the Republic of the ▇▇▇▇▇▇▇▇ Islands (the “Parent”); and

(2) COSTAMARE SHIPPING COMPANY S.A., a company organized and existing under the laws of the Republic of Panama (the “Manager”).

WHEREAS:

(A) The Parent wholly owns (i) the corporations set out in Schedule A hereto, as such Schedule A may be amended from time to time (the “Shipowning Subsidiaries”), each of which owns one or more Container Vessels (as defined below) (the “Vessels”) and (ii) the corporations set out in Schedule B hereto, as such Schedule B may be amended from time to time (together with the Shipowning Subsidiaries, the “Subsidiaries”).

(B) The Manager has the benefit of experience in the technical and commercial management of Container Vessels and administration of shipowning companies generally.

(C) The Parent and the Manager desire to adopt this Agreement, pursuant to which the Manager shall represent the Group (as defined below) in its dealings with third parties and either directly or through a Submanager (as defined below) provide technical, commercial, administrative and certain other services to the members of the Group as specified herein in connection with the management and administration of the business of the members of the Group.

NOW, THEREFORE, THE PARTIES HEREBY AGREE:

ARTICLE I

INTERPRETATION

SECTION 1.1. In this Agreement, unless the context otherwise requires:

“Affiliates” means, with respect to any person as to any particular date, any other persons that directly or indirectly, through one or more intermediaries, are Controlled by, Control or are under common Control with the person in question, and Affiliates means any of them.

“Agreement” shall have the meaning set forth in the preamble.

“Annual Period” shall have the meaning set forth in Section 9.2.

“Approved Budget” shall have the meaning set forth in Section 10.3.

“Beneficial Owner” has the meaning set forth in Rule 13d-3 under the Exchange Act. For purposes of this definition, such person or group shall be deemed to Beneficially Own any outstanding voting securities of a company held by any other company (the “parent company”) that is Controlled by such person or group. The term “Beneficially Own” and similar capitalized terms shall have analogous meanings.

“Board of Directors” means the board of directors of the Parent as the same may be constituted from time to time.

“Business Days” means a day (excluding Saturdays and Sundays) on which banks are open for business in Athens, Greece; and New York, New York.

“Change in Control of the Manager” means (a) a sale of all or substantially all of the assets or property of the Manager necessary for the performance of the Manager’s services under this Agreement, (b) a sale of the Manager’s shares that would result in ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ Beneficially Owning, directly or indirectly, less than 50.1% of the total voting power of the outstanding voting securities of the Manager or (c) a merger, consolidation or similar transaction, that would result in ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ Beneficially Owning, directly or indirectly, less than 50.1% of the total voting power of the outstanding voting securities of the resulting entity following such transaction.

“Change in Control of the Parent” means the occurrence of any of the following events: (a) if any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act or any successor provisions to either of the foregoing), including a group acting for the purpose of acquiring, holding, voting or disposing of securities within the meaning of Rule 13d-5(b)(10) under the Exchange Act (other than one or more Konstantakopoulos Entities) (collectively, an “Acquiring Person”) becomes the Beneficial Owner, directly or indirectly, of 40% or more of the total voting power of the outstanding voting securities of the Parent, which voting power represents a higher percentage than that of the Konstantakopoulos Entities, collectively; or (b) the approval by the shareholders of the Parent of a proposed merger, consolidation or similar transaction, as a result of which any Acquiring Person becomes the Beneficial Owner, directly or indirectly, of 40% or more of the total voting power of the outstanding voting securities of the resulting entity following such transaction, which voting power represents a higher percentage than that of the Konstantakopoulos Entities, collectively; or (c) a change in directors after which a majority of the members of the Board of Directors are not Continuing Directors.

“Consent of the Parent” means the prior written consent of a majority of the Independent Directors of the Parent.

“Container Vessel” means any ocean-going vessel (whether in its construction phase or operational) that is intended to be used primarily to transport containerized cargoes.

“Continuing Directors” means, as of any date of determination, any member of the Board of Directors who (i) was a member of the Board of Directors immediately after the Effective Date, or (ii) was nominated for election or elected to the Board of Directors with the approval of a majority of the directors then still in office or who were either directors immediately after the Effective Date or whose nomination or election was previously so approved.

“Control” or “Controlled” means, with respect to any person, the right to elect or appoint, directly or indirectly, a majority of the directors of such person or a majority of the persons who have the right, including any contractual right, to manage and direct the business, affairs and operations of such person or the possession of the power to direct or cause the direction of the management and policies of a person, whether through ownership of voting securities, by contract or otherwise.

“Crew” shall have the meaning set forth in clause 1 of each Shipmanagement Agreement.

“Draft Budget” shall have the meaning set forth in Section 10.1.

“Effective Date” means the date upon which the initial public offering of the Parent is consummated.

“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended.

“Executive Officers” means the Chief Executive Officer, the Chief Operating Officer (if any) and the Chief Financial Officer of the Parent.

“Fixed Period” shall have the meaning set forth in Section 9.2.

“Force Majeure” shall have the meaning set forth in Section 11.1.

“Group” means, at any time, the Parent and the Subsidiaries at such time taking into account the Schedule A and Schedule B in effect at such time and “member of the Group” shall be construed accordingly.

“Independent Directors” means those members of the Board of Directors that qualify as independent directors within the meaning of Rule 10A-3 promulgated under the Exchange Act and the listing criteria of the New York Stock Exchange.

“Initial Term” shall have the meaning set forth in Section 13.1.

“Konstantakopoulos Entities” means:


	(a)	▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ or ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇;


	(b)	any spouse or lineal descendant of any of the individuals set out in paragraph (a) above; and

	(c)	any person Controlled by, or under common Control with, any such individual or combination of such individuals as set out in paragraphs (a) and (b) above.

“Management Fee” shall have the meaning set forth in Section 9.1.

“Management Services” shall have, in relation to a Vessel, the meaning set forth in clause 1 of the Shipmanagement Agreement applicable to such Vessel.

“Manager” shall have the meaning set forth in the preamble.

“Manager Related Parties” shall have the meaning set forth in Section 11.2.

“Newbuild” means a new vessel to be or which has just been constructed, or is under construction, pursuant to a shipbuilding contract or other related agreement entered into by the relevant member of the Group.

“Parent” shall have the meaning set forth in the preamble.

“Questioned Items” shall have the meaning set forth in Section 10.2.

“Related Manager” means each of CIEL Shipmanagement S.A., Shanghai Costamare Ship Management Co., Ltd. or any Affiliate of a Konstantakopoulos Entity appointed as Submanager in accordance with the terms of this Agreement.

“Services” shall have the meaning set forth in Section 2.3.

“Shipmanagement Agreement” shall have the meaning set forth in Section 3.2.

“Shipowning Subsidiaries” shall have the meaning set forth in the recitals.

“STCW 95” means the International Convention on Standards of Training, Certification and Watchkeeping for Seafarers, 1978, as amended in 1995 or any subsequent amendment thereto.

“Submanager” shall have the meaning set forth in Section 2.4.

“Subsequent Term” shall have the meaning set forth in Section 13.1.

“Subsidiaries” shall have the meaning set forth in the recitals.

“Supervision Agreement” shall have the meaning set forth in Section 3.3.

“Term” shall have the meaning set forth in Section 13.1.

“Vessels” shall have the meaning set forth in the recitals.

SECTION 1.2. The headings of this Agreement are for ease of reference and do not limit or otherwise affect the meaning hereof.

SECTION 1.3. All the terms of this Agreement, whether so expressed or not, shall be binding upon the parties hereto and their respective successors and assigns.

SECTION 1.4. In the event of any conflict between this Agreement, any Shipmanagement Agreement or any Supervision Agreement, the provisions of this Agreement shall prevail.

SECTION 1.5. Unless otherwise specified, all references to money refer to the legal currency of the United States of America.

SECTION 1.6. Unless the context otherwise requires, words in the singular include the plural and vice versa.

SECTION 1.7. The words “include”, “includes” and “including” when used herein shall be deemed in each case to be followed by the words “without limitation” and shall not be construed to limit any general statement which it follows to the specific or similar items or matters immediately following it.

SECTION 1.8. Any reference to “person” includes an individual, body corporate, limited liability company, partnership, joint venture, cooperative, trust or unincorporated organization, association, trustee, domestic or foreign government or any agency or instrumentality thereof, or any other entity recognized by law.

SECTION 1.9. Any reference to an enactment shall be deemed to include reference to such enactment as re-enacted, amended or extended.

SECTION 1.10. Any reference to (or to any specified provision of) this Agreement or any other document shall be construed as reference to this Agreement, that provision or that document as in force for the time being and as amended in accordance with the terms thereof, or, as the case may be, with the agreement of the relevant parties.

SECTION 1.11. Any reference to clauses, appendices and schedules shall be construed as reference to clauses of, appendices to and schedules to this Agreement and references to this Agreement includes its appendices and schedules.

ARTICLE II

APPOINTMENT

SECTION 2.1. The Manager is hereby appointed by the Parent as the administrative manager of the Group and hereby accepts such appointment on the terms and conditions of this Agreement.

SECTION 2.2. The Manager shall be appointed by (a) each Shipowning Subsidiary pursuant to the provisions of Section 3.3 hereof as the technical and commercial manager of each such Shipowning Subsidiary’s Vessel on the terms and conditions of the relevant Shipmanagement Agreement and this Agreement and (b) each member of the Group to be acquiring a Newbuild, as the supervisor of the construction thereof on the terms and conditions of the relevant Supervision Agreement and this Agreement.

SECTION 2.3. The Manager agrees to provide:


	(a) the services specified in Articles V, VI, VII and VIII of this Agreement;

	(b) the services specified in each Supervision Agreement; and

	(c) the Management Services (as such term is defined in clause 1 of each Shipmanagement Agreement) in respect of each Vessel specified in each Shipmanagement Agreement (the services to be provided under Sections 2.3(a), 2.3(b) and 2.3(c) collectively the “Services”).

	The Parent and the Manager each hereby agree that in the performance of this Agreement, any Supervision Agreement or any Shipmanagement Agreement, the Manager or, as the case may be, any Submanager, is acting solely on behalf of, as agent of and for the account of, the Parent or any other relevant member of the Group. The Manager or, as the case may be, the relevant Submanager may advise persons with whom it deals on behalf of the Parent or any other member of the Group that it is conducting such business for and on behalf of the Parent or, as the case may be, a member of the Group.

SECTION 2.4. The Manager may upon notice to the Parent appoint any person (a “Submanager”) at any time throughout the duration of this Agreement to discharge any of the Manager’s duties under this Agreement or a Shipmanagement Agreement or a Supervision Agreement, provided that if such person is not a Related Manager, the Manager shall obtain the written Consent of the Parent prior to such appointment (such Consent of the Parent shall not be unreasonably withheld or delayed). The Manager shall appoint a Submanager either by entering into a management agreement or supervision agreement (such management agreement or supervision agreement to be on terms to be agreed between the parties thereto and only in respect of the services that the Manager wishes such Submanager to discharge) directly with such Submanager (for the avoidance of doubt, unless otherwise agreed in writing, no member of the Group shall have any responsibility for any fees or costs incurred under any such management agreement or supervision agreement) or by directing such Submanager to enter into a management agreement or supervision agreement directly with the relevant member of the Group (such management agreement or supervision agreement to be on terms to be agreed between the parties thereto and only in respect of the services that the Manager wishes such Submanager to discharge). Any Submanager shall agree to the terms and conditions

of this Agreement to the extent applicable to it, prior to performing any services for any member of the Group. The Parent shall procure that each member of the Group shall provide written confirmation to the Manager or, as the case may be, a Submanager, that such member’s Vessel is commercially and/or technically managed by the Manager or, as the case may be, the relevant Submanager.

SECTION 2.5. The Manager’s power to delegate performance of any provision of this Agreement, including delegation by directing a Submanager to enter into a management agreement or supervision agreement directly with a member of the Group in accordance with Section 2.4, shall not limit the Manager’s liability to the Parent to perform this Agreement with the intention that the Manager shall remain responsible to the Parent for the due and timely performance of all duties and responsibilities of the Manager hereunder, PROVIDED HOWEVER, that to the extent that any Submanager has performed any such duty, the Manager shall not be under any obligation to perform again the same duty.

ARTICLE III

THE PARENT’S GENERAL OBLIGATIONS

SECTION 3.1. The Parent shall notify the Manager as soon as possible of any purchase of any vessel (whether the same is a second-hand vessel or a Newbuild), the delivery of any Newbuild from the relevant builder or intermediate seller to the relevant member of the Group to take ownership of such Newbuild, the sale of any Vessel, the purchase or creation of any direct or indirect subsidiary of the Parent or the sale or divestiture of any Subsidiary and shall promptly amend Schedule A and Schedule B hereto, as applicable, to be reflective of any such development. Such amended Schedule A or Schedule B shall be effective on any such day as mutually agreed by the Parent and the Manager, which date shall be no later than five Business Days after delivery of such amended Schedule A and/or Schedule B to the Manager by the Parent.

SECTION 3.2. For each Vessel the Parent shall cause the relevant Shipowning Subsidiary to enter into with the Manager, and the Manager shall enter into with such Shipowning Subsidiary, a contract substantially in the form attached hereto as Appendix I (each a “Shipmanagement Agreement” and, collectively, the “Shipmanagement Agreements”), with such alterations and additions as are appropriate; PROVIDED HOWEVER, that any alterations or additions which materially vary from such form shall require the approval of the Board of Directors.

SECTION 3.3. For each Newbuild the Parent shall cause the relevant Shipowning Subsidiary to enter into with the Manager, and the Manager shall enter into with such Shipowning Subsidiary, a contract substantially in the form attached hereto as Appendix II (each a “Supervision Agreement” and, collectively, the “Supervision Agreements”), with such alterations and additions as are appropriate; PROVIDED HOWEVER, that any alterations or additions which materially vary from such form shall require the approval of the Board of Directors.

SECTION 3.4. The Parent shall pay punctually all sums due to the Manager under this Agreement, any Shipmanagement Agreement and/or any Supervision Agreement to which the Manager is a party in accordance with the respective terms thereof.

SECTION 3.5. The Parent shall procure that each other member of the Group (a) performs its obligations under any Shipmanagement Agreement or any Supervision Agreement to which it is a party and (b) does not take any action or omit to take any action the effect of which is to cause the Parent or the Manager or a Submanager to be in breach of this Agreement, any Shipmanagement Agreement and/or any Supervision Agreement.

SECTION 3.6. The Parent agrees that it has engaged the Manager to provide the Services on an exclusive basis and, without receiving the prior written approval of the Manager or before it has lawfully terminated this Agreement in accordance with its terms, it will not engage any other entity to provide any of the Services.

ARTICLE IV

THE MANAGER’S GENERAL OBLIGATIONS

SECTION 4.1. In the exercise of its duties hereunder, the Manager shall act in accordance with the reasonable policies, guidelines and instructions from time to time communicated to it in writing by any member of the Group.

SECTION 4.2. For each Vessel or, as the case may be, Newbuild the Manager shall act and do all and/or any of the acts or things described in this Agreement and the relevant Shipmanagement Agreement or Supervision Agreement applicable to each such Vessel or Newbuild in the name and/or on behalf of the Parent and/or the relevant Subsidiary or Subsidiaries.

SECTION 4.3. The Manager acknowledges that the services it will provide pursuant to the Shipmanagement Agreements or the Supervision Agreements are not limited to the services described in such agreements and include those set forth in this Agreement.

SECTION 4.4. The Manager shall exercise commercially reasonable care to cause all material property of any member of the Group to be clearly identified as such, held separately from the property of the Manager and, where applicable, held in safe custody.

SECTION 4.5. The Manager shall exercise commercially reasonable care to cause adequate manpower to be employed by it to perform its obligations under this Agreement, PROVIDED HOWEVER, that the Manager, in the performance of its responsibilities under this Agreement, shall be entitled to have regard to its overall responsibilities in relation to the management of its clients and in particular, without prejudice to the generality of the foregoing, the Manager shall be entitled to allocate

available resources and services in such manner as in the prevailing circumstances the Manager considers to be fair and reasonable.

SECTION 4.6. Notwithstanding anything to the contrary contained in this Agreement or any Shipmanagement Agreement or any Supervision Agreement, the Manager agrees that any and all decisions of a material nature relating to the Parent, any Subsidiary, any Vessel or any Newbuild under construction shall be reserved to the Parent, such decisions including, but not being limited to:


	(a) the purchase and/or sale of shares in any entity or other assets of a material nature;

	(b) the purchase, formation or dissolution of subsidiaries;

	(c) the entry into guarantees or loans or other forms of financing and any and all financial undertakings and commitments connected therewith; and

	(d) the presentation, negotiation, settlement, prosecution or defense of any claim, demand or petition for an amount exceeding US$1,000,000 or its equivalent.

SECTION 4.7. During the Term, the Manager shall promote the business of the Group in accordance with the directions of the authorized representative or, as the case may be, representatives of the respective member of the Group and shall at all times use commercially reasonable efforts to conform to and comply with the lawful and reasonable directions, regulations or recommendations made by such authorized representative or, as the case may be, representatives, and in the absence of any specific directions or recommendations as aforesaid and, subject to the terms and conditions of this Agreement, shall provide general administrative and advisory services in connection with the management of the business of the Group.

SECTION 4.8. The Manager, in the performance of its responsibilities under this Agreement, any Supervision Agreement or any Shipmanagement Agreement, shall exercise commercially reasonable care to cause any purchases of products or services from any of its Affiliates to be on terms no less favorable to the Manager than the market prices for products or services that the Manager could obtain on an arm’s length basis from unrelated parties.

SECTION 4.9. During the term hereof, the Manager agrees that it will provide the Services to the Group on an exclusive basis and, without receiving the prior Consent of the Parent, it will not provide any Services or other services contemplated herein to any entity other than the Parent and each Subsidiary.

SECTION 4.10. If a Vessel (which expression for the purposes of this Section shall include any Newbuild to be acquired by a member of the Group) and a Container Vessel directly or indirectly owned or operated by a third party are both available and meet the criteria for a charter being fixed by the Manager, the Vessel shall be

offered such charter first and the Parent shall have 48 hours from such offer being received to accept such offer, failing which such charter shall be then offered to the relevant third party.

SECTION 4.11. The Manager shall at all times maintain appropriate and necessary accounts and records as regards the Services and shall make the same available for inspection and auditing by the Parent at such times as may be mutually agreed by the Manager, on the one hand, and the Parent, on the other hand.

ARTICLE V

ADMINISTRATIVE SERVICES

SECTION 5.1. The Manager shall provide certain general administrative services to the Group, including, but not limited to, the following:


	(a) keeping all books and records of things done and transactions performed on behalf of any member of the Group as it may require from time to time, including, but not limited to, liaising with accountants, lawyers and other professional advisors;

	(b) except as otherwise contemplated herein, representing any member of the Group generally in its dealings and relations with third parties;

	(c) maintaining the general ledgers of the Group, establishing bank accounts with such financial institutions as the Parent may request, managing, administering and reconciling of the Group’s bank accounts, preparation of periodic consolidated financial statements of the Group, including, but not limited to, those required for governmental and regulatory or self-regulatory agency filings and reports to shareholders, arranging of the auditing and/or review of any such financial statements and the provision of related data processing services;

	(d) providing assistance in the preparation of periodic and other reports, proxy statements, registration statements and other documents and reports required by applicable law (including rules and regulations promulgated by the U.S. Securities and Exchange Commission) or the rules of any securities exchange or inter-dealer quotation system on which the securities of the Parent or any member of the Group may be listed or quoted;

	(e) preparing and providing (or procuring, at the Parent’s cost, a third party service provider to prepare and provide) tax returns required by any law or regulatory authority and developing, maintaining and monitoring internal audit controls, disclosure controls and information technology for the Group;


	(f) arranging for the provision of advisory services (either directly or, at the Parent’s cost, through a third party service provider) to ensure the Group is in compliance with all applicable laws, including all relevant securities laws, including the preparation for review, approval and filing by the Parent of reports and other documents with the U.S. Securities and Exchange Commission, any securities exchange on which its shares are listed and all other regulatory authorities having jurisdiction over the Parent or with other securities exchanges on which the Parent’s securities are listed;

	(g) either directly or, at the Parent’s cost, through a third party service provider (such as by appointing lawyers), providing for the presentation, negotiation, settlement, prosecution or defense of any claim, demand or petition on behalf of any member of the Group arising in connection with the business of any member of the Group for an amount not exceeding US$1,000,000 or its equivalent, including the pursuit by any member of the Group of any rights of indemnification or reimbursement;

	(h) providing assistance in negotiating loan and credit terms with lenders and monitoring and administration of compliance with any applicable financing terms and conditions in effect with investors, banks or other financial institutions;

	(i) assisting with arranging board meetings, director accommodation and travel for board meetings and preparing meeting materials and detailed papers and agendas for scheduled meetings of the Board of Directors or the board of directors of any other member of the Group (and any and all committees thereof) that, where applicable, contain such information as is reasonably available to the Manager to enable the Board of Directors or such other board of directors (and any such committees) to base their opinion;

	(j) preparing or causing to be prepared reports to be considered by the Board of Directors (or any applicable committee thereof) in accordance with the Parent’s internal policies and procedures on any acquisition, investment or sale of any part of the business;

	(k) administering payroll services, benefits and director’s or consultant’s fees, as applicable, for any employee, officer, consultant or director of the Group;

	(l) handling general and administrative expenses of the Parent, which are related to its operation as public company and, upon being placed by the Parent in funds in accordance with the terms of this Agreement, arranging for the payment of the same;


	(m) either directly or, at the Parent’s cost, through a third party service provider (such as by appointing lawyers), handling all administrative and clerical matters in respect of (i) the calling and arrangement of all annual and/or special meetings of shareholders of the Parent, (ii) the preparation of all materials (including notices of meetings and information circulars) in respect thereof and (iii) the submission of all such materials to the Parent in sufficient time prior to the dates upon which they must be mailed, filed or otherwise relied upon so that the Parent has full opportunity to review, approve, execute and return them to the Manager for filing or mailing or other disposition as the Parent may require or direct;

	(n) providing, at the request and under the direction of the Parent, such communications to the transfer agent for the Parent as may be necessary or desirable;

	(o) assisting the Parent in establishing and maintaining a system of internal controls sufficient to satisfy applicable regulatory requirements;

	(p) providing the Group with office accommodation, office staff (including secretarial and administrative assistance), facilities and stationery;

	(q) maintaining, at the Parent’s cost, the Parent’s and each other member’s of the Group corporate existence, qualification and good standing in all necessary jurisdictions and assisting in all other corporate and regulatory compliance requirements;

	(r) at the Parent’s cost, assisting in all corporate and regulatory compliance requirements for incorporating a new entity that will be owned (inter alios) by a member of the Group and/or for dissolving any member of the Group, in all necessary jurisdictions;

	(s) at the request of the Parent, negotiating the terms and thereafter arranging for cash management services and/or hedging arrangements, in each case with a third party provider at the cost of the Parent;

	(t) at the request of the Parent, monitoring the performance of investment managers; and

	(u) providing any such other administrative services as the Parent, the Executive Officers or any other representative of the Parent may request and the Manager may agree to provide from time to time.

ARTICLE VI

COMMERCIAL SERVICES

SECTION 6.1. In addition to any commercial services provided under clause 3.3 of each Shipmanagement Agreement, the Manager shall provide the following commercial services to the Group:


	(a) performing class records review and physical inspections in respect of any vessel considered for purchase by a member of the Group;

	(b) at the request and under the direction of the Parent, providing administrative services in connection with the purchase of a second-hand vessel or the acquisition and sale of a Newbuild, in either case by any member of the Group, including, if specifically instructed by the Parent in writing, signing any agreed form of memorandum of agreement, shipbuilding contract or other similar contract for and on behalf of the relevant member of the Group;

	(c) managing relationships between the Parent and any existing or potential charterers, shipbuilders, insurers, lenders, investors, fund managers, shareholders and other shipping industry service providers/participants; and

	(d) at the request of the Parent, providing certain services in connection with a member of the Group taking physical delivery of a vessel, registering a vessel under a ship register, tendering physical delivery of a Vessel or deleting a Vessel from the applicable port of registry, in each case on behalf of the relevant member of the Group.

ARTICLE VII

INSURANCE

SECTION 7.1. In addition to any insurance requirements provided in clause 3.4 of each Shipmanagement Agreement, the Manager shall:


	(a) arrange either directly or, through insurance brokers appointed by the Manager, Directors & Officers’ liability insurance for the Board of Directors with such insurance companies, at such rates and otherwise on such other terms as the Parent shall have instructed and/or agreed upon;

	(b) on request, provide the Parent with a copy of any insurance claims and any reports prepared by the relevant insurers; and


	(c) subject to having been placed in funds on time by the Parent, take commercially reasonable care to cause all premiums on the Parent’s Directors & Officers’ liability insurance are paid in a timely fashion.

ARTICLE VIII

AVAILABILITY OF OFFICERS AND EMPLOYEES

SECTION 8.1. The Manager shall make available to the Parent all such officers, managers and employees, including any of the Executive Officers, that the Parent and the Manager agree shall be made available, PROVIDED ALWAYS, that any remuneration of any officers, managers, employees or Executive Officers made available by the Manager to any member of the Group, shall be paid by the Parent to the Manager according to terms to be agreed at the time.

SECTION 8.2. The Executive Officers are entitled to direct the Manager to remove and replace any individual serving as an officer or any senior manager serving as head of a business unit, in either case, of any member of the Group, other than an Executive Officer, from such position. The Board of Directors, in its sole discretion, shall be entitled to direct the Manager to remove any individual made available to the Parent by the Manager serving as an Executive Officer from such position and to appoint such other individual to serve as successor as the Board of Directors shall approve. Furthermore, the Manager agrees that it will not remove any individuals serving as officers or senior managers of any member of the Group from their respective positions without the prior written consent of the Executive Officers (such consent not to be unreasonably withheld or unduly delayed) and, in the case of any Executive Officer, the Board of Directors. If any officer or senior manager who is made available to the Parent by the Manager resigns, is terminated or otherwise vacates his or her office, the Manager shall, as soon as practicable after acceptance of any resignation or after termination, use reasonable best efforts to identify suitable candidates for replacement of such officer.

SECTION 8.3. The Parent may employ directly any other officers, senior managers or employees as it may deem necessary that will not be subject to this Agreement.

SECTION 8.4. The Manager will report to the Parent and the Board of Directors through any one of the Executive Officers.

ARTICLE IX

MANAGEMENT FEES AND EXPENSES

SECTION 9.1. In consideration of the Manager providing the Services to the Group, the Parent shall pay the Manager the following fees (together, the “Management Fees” and, on a per Vessel basis, the “Management Fee”):


	(a) subject to Sections 9.2 and 9.3, a fee of US$850 per day per Vessel, payable monthly in arrears (pro rated to reflect the number of


	days that the Parent (or any Subsidiary) owns or charters-in each Vessel during the applicable month), unless a Vessel is chartered-out to a third party on a bareboat charter basis, in which case the fee payable to the Manager for such Vessel shall be, subject to Sections 9.2 and 9.3, US$425 per day, PROVIDED HOWEVER, that when in respect of certain services to a Vessel the Manager appoints a Submanager in accordance with Section 2.4 and such Submanager enters into a management agreement directly with the relevant member of the Group (the “direct agreement”), the fees payable by the Parent and/or such member of the Group under this Agreement and/or any relevant Shipmanagement Agreement in respect of such Vessel pursuant to Section 9.1(a) shall be US$850 per day, or as the case may be, US$425 per day minus, in each case, the fees per day payable by such member of the Group to such Submanager under the relevant direct agreement in respect of such Vessel;

	(b) a fee equal to 0.75% calculated on the aggregate of the gross freight, demurrage, charter hire, ballast bonus or other income obtained for the employment of each Vessel during the term of this Agreement, payable to the Manager monthly in arrears, only to the extent such freight, demurrage, charter hire, ballast bonus or other income, as the case may be, is received as revenue;

	(c) subject to Sections 9.2 and 9.3, a fee of US$700,000 per Newbuild under construction for the services rendered by the Manager under the Supervision Agreement in respect of such Newbuild, payable in accordance with the terms of such Supervision Agreement.

SECTION 9.2. The Management Fees will be fixed for the period commencing on the date of this Agreement and ending on the last day of the calendar year falling two years after the date of this Agreement (the “Fixed Period”) and shall not be subject to adjustment for Euro/U.S. Dollar exchange rate fluctuations or inflation until the last day of the Fixed Period. For the 12-month period starting on the day falling immediately after the end of the Fixed Period and for each subsequent 12-month period falling thereafter (each such 12-month period referred to hereinafter as an “Annual Period”), the Management Fee for each Vessel payable pursuant to Section 9.1(a) or Section 9.1(c) will be adjusted upwards with effect from the beginning of such Annual Period by application, to the relevant per Vessel amount, of a percentage figure equal to four per cent (4%), PROVIDED ALWAYS, that in the event of any of the provisions of Section 9.3 applying, further increases may be applied to such Management Fees as determined pursuant to Section 9.3.

SECTION 9.3. The Management Fees for each Vessel payable pursuant to Section 9.1(a) or Section 9.1(c), for the Annual Period commencing on the day falling immediately after the end of the Fixed Period and each subsequent Annual Period thereafter, will, in each case, be further adjusted upwards with effect from the beginning of such Annual Period if:


	(a) the average of the Euro/U.S. Dollar exchange rates during the 12-month period ending on the last day of the month of September falling before the commencement date of such Annual Period (such average being the average over the applicable period, as calculated by the Manager from the Euro Foreign Exchange Reference Rate published daily at 15:00 CET by the European Central Bank on ▇▇▇.▇▇▇.▇▇▇) evidence that the Euro has strengthened against the U.S. Dollar by more than five per cent (5%) from:

	(i) in the case of the first Annual Period starting on the day falling immediately after the end of the Fixed Period, the rate existing on the business day immediately prior to the date of this Agreement, and

	(ii) in the case of each subsequent Annual Period, the previous Euro/U.S. Dollar average calculated for the purposes of this Section 9.3 in respect of the immediately previous Annual Period, by the average percentage amount by which the Euro has in each such case so strengthened against the U.S. Dollar; and/or

	(b) the Manager has incurred a material unforeseen increase in the cost of providing the Services, by an amount to be agreed between the Manager and the Parent, each acting in a commercially reasonable manner.

SECTION 9.4. The Manager shall, subject to Section 9.5, pay for all usual office expenses incurred by it as the Manager.

SECTION 9.5. The Parent hereby acknowledges that any capital expenditure, financial costs, operating expenses for each Vessel and any general and administrative expenses of the Group whatsoever are not covered by the Management Fees and any such expenditure, costs and expenses shall be paid fully by the Parent or the applicable member of the Group, whether directly to third parties (which for the avoidance of doubt shall include any Submanager) or by payment to such third parties through the Manager and, without prejudice to Section 10.8, to the extent incurred by the Manager, shall be reimbursed to it by the Parent and/or any member of the Group the Manager seeks, in its discretion, reimbursement from. The said capital expenditure, financial costs, operating expenses for each Vessel and general and administrative expenses of the Group include, without limiting the generality of the foregoing, items such as:


	(a) fees, interest, principal and any other costs due to the Group’s financiers and their respective advisors;

	(b) all voyage expenses and vessel operating and maintenance expenses relating to the operation and management of the Vessels (including Crew costs, surveyor’s attendance fees, bunkers, lubricant oils, spares, survey fees, classification society fees, maintenance and repair costs, vetting expenses, etc.);


	(c) any commissions, fees, remuneration or disbursements due to lawyers, brokers, agents, surveyors, consultants, financial advisors, investment bankers, insurance advisors or any other third parties whatsoever appointed by the Manager whether in its name or on behalf and/or in the name of any member of the Group;

	(d) any commissions, fees, remuneration or disbursements due to lawyers, brokers, agents, surveyors, consultants, financial advisors, investment bankers, insurance advisors or any other third parties (other than, if applicable, a Related Manager) whatsoever sub-contracted to the Manager in the normal and reasonable course of meeting the Manager’s duties and obligations under this Agreement or any Shipmanagement Agreement or any Supervision Agreement including the duties provided in Articles V, VI and VII of this Agreement;

	(e) applicable deductibles, insurance premiums (including Directors & Officers’ liability insurance) ▇▇▇/▇▇ ▇&▇ calls;

	(f) compensation expenses for employees who are not provided by the Manager or which are provided by the Manager pursuant to Section 8.1;

	(g) postage, communication, traveling, lodging, victualling, overtime, out of office compensation and out of pocket expenses of the Manager and/or its personnel, incurred in pursuance of the Services; and

	(h) any other out of pocket expenses that are incurred by the Manager in the performance of the Services pursuant to this Agreement, any Supervision Agreement or any Shipmanagement Agreement.

SECTION 9.6. The Manager shall have the right to demand the Management Fee payable in relation to each Vessel from either the Parent or the Shipowning Subsidiary owning such Vessel under the terms of the relevant Shipmanagement Agreement. By written notice to the Parent, the Manager may direct the Parent to pay any amounts owing by the Manager to any Submanager pursuant to a subcontract of any provisions of this Agreement or any Shipmanagement Agreement or any Supervision Agreement, directly to the relevant Submanager.

SECTION 9.7. In the event that a Shipmanagement Agreement is terminated, other than by reason of default by the Managers, the Management Fee payable to the Manager under Section 9.1(a) for the Vessel subject to such Shipmanagement Agreement shall be payable in respect of such Vessel for a further period of three months from the termination date. The fees payable for the said three months shall be paid in one lump sum in advance on the termination of the relevant Shipmanagement Agreement. In addition the relevant member of the Group shall pay any Severance Costs (as such term is defined in the relevant Shipmanagement Agreement) for the relevant Vessel which may materialize.

ARTICLE X

BUDGETS, CORPORATE PLANNING AND EXPENSES

SECTION 10.1. On or before October 1 of each calendar year, the Manager shall prepare and submit to the Executive Officers a detailed draft budget for the next calendar year in a format acceptable to the Executive Officers and the Board of Directors and generally used by the Manager which shall include a statement of estimated revenue and out-of-pocket expenses in providing the Services (the “Draft Budget”).

SECTION 10.2. For a period of 20 days after receipt of the Draft Budget, the Executive Officers, from time to time, may request further details and submit written comments on the Draft Budget. If the Executive Officers do not agree with any item of the Draft Budget, they will, within the same 20-day period, give the Manager notice of any inquiries to the Draft Budget, which notice will include the list of items under consideration (the “Questioned Items”) and a proposal for the resolution of each such Questioned Item. The Executive Officers and the Manager will endeavor to resolve any such differences between them with respect to the Questioned Items, failing which the relevant Questioned Items shall be left as presented by the Manager. If the Executive Officers do not present any Questioned Items within such 20-day period, they will be deemed to have accepted the Draft Budget and, such Draft Budget, shall be deemed to be the Approved Budget (as defined in Section 10.3 below).

SECTION 10.3. By November 15 of the relevant calendar year (or such later date as the Manager and the Board of Directors deem appropriate), and to the extent that changes are required to the Draft Budget pursuant to Section 10.2, the Manager will prepare and deliver to the Parent a revised budget that has been approved by the Executive Officers (the “Approved Budget”). However, the Parent acknowledges that the Approved Budget is only an estimate of the performance of the Vessels and/or the Group and the Manager makes no assurance, representation or warranty that the actual performance of the Vessels and/or the Group in any relevant calendar year will correspond to the estimates contained in the Approved Budget for that calendar year.

SECTION 10.4. The Manager may, from time to time, in any calendar year propose amendments to the Approved Budget upon 15 days notice to the Parent, in which event the Executive Officers will have the right to approve the amendments in accordance with the process set out in Section 10.2 with the relevant time periods being amended accordingly.

SECTION 10.5. Once the Approved Budget has been delivered, the Manager shall prepare and present to the Parent its estimate of the working capital requirements of the Vessels and the Group and the Manager shall each month update this estimate. Based thereon, the Manager shall each month make a request to the Parent and/or, as the case may be, the relevant members of the Group, in writing for the funds required to provide the Services to the Group and to operate each Vessel for the ensuing month, including the payment of any occasional or extraordinary item of expenditure, such as emergency repair costs, additional insurance premiums, bunkers or provisions. The

Manager may also make a request in writing to the Parent and/or, as the case may be, the relevant members of the Group, at any time for funds required for the payment of any occasional or extraordinary item of expenditure, such as emergency repair costs, additional insurance premiums, bunkers or provisions. Such funds shall be received by the Manager within ten calendar days after the receipt by the Parent or, as the case may be, the relevant member of the Group of the Manager’s written request and shall be held in a separate bank account in the name of the Manager or, if requested by the Manager, in the name of the Parent or of the relevant member of the Group.

At the end of each quarter or, if the Manager from time to time so requires, month, the Manager shall preliminarily reconcile the amounts advanced to it by the Parent or, as the case may be, the relevant member of the Group, with the amounts actually expended by it for the operation of each of the Vessels and/or the Group, and (a) the Manager shall remit to the Parent, or credit to the Parent amounts to be advanced to it hereunder for future months, any unused portion of the amounts previously advanced by the Parent or, as the case may be, the relevant member of the Group, or (b) the Parent shall pay to the Manager any amounts properly expended by the Manager in excess of the amounts previously advanced by the Parent or, as the case may be, the relevant member of the Group. The Parent and the Manager shall reconcile any amounts due to the Parent by the Manager or due to the Manager by the Parent for each fiscal year of the Parent as promptly as practicable following the close of each such fiscal year. Without prejudice to Section 10.8, any expenses incurred by the Manager under the terms of this Agreement on behalf of any member of the Group may be debited against the account of the respective member of the Group, but shall in any event remain payable by the Parent and the relevant member of the Group to the Manager on demand.

SECTION 10.6. The Manager shall also maintain the records of all costs and expenses incurred, including any invoices, receipts and supplementary materials as are necessary or proper for the settlement of accounts.

SECTION 10.7. Insofar as any moneys are collected from third parties by the Manager under the terms of this Agreement, any Shipmanagement Agreement and/or any Supervision Agreement (other than moneys payable by a member of the Group to the Manager), such moneys and any interest thereon shall be held to the credit of the relevant member of the Group in a separate bank account in the name thereof. Interest on any such bank account shall be for the benefit of the relevant member of the Group.

SECTION 10.8. Notwithstanding anything contained herein to the contrary, the Manager shall in no circumstances be required to use or commit its own funds to finance the provision of the Services.

SECTION 10.9. To the extent that a Related Manager has been appointed in accordance with the terms of Section 2.4, it is agreed by the Parent and the Manager for the benefit of such Related Manager that the provisions of Article X shall apply to such Related Manager as if such provisions were repeated herein, but with references to:


	(a) the “Manager” being deemed as references to the relevant Related Manager;

	(b) the “Services” being deemed as references to the services to be performed by such Related Manager under the relevant management agreement;

	(c) the “Vessels” being deemed as references to the Vessels being managed by such Related Manager under a management agreement entered into directly with the relevant Group members;

	(d) the “Parent” being deemed as references to the relevant Group members; and

	(e) references to “this Agreement, any Shipmanagement Agreement and/or any Supervision Agreement” being deemed as references any management agreement signed by such Related Manager directly with the relevant Group members.

ARTICLE XI

LIABILITY AND INDEMNITY

SECTION 11.1. Save for the obligation of the Parent to pay any moneys due to the Manager hereunder, neither any member of the Group nor the Manager shall be under any liability to the other for any failure to perform any of their obligations hereunder by reason of Force Majeure. “Force Majeure” shall mean any cause whatsoever of any nature or kind beyond the reasonable control of the relevant member of the Group or the Manager, including, without limitation, acts of God, acts of civil or military authorities, acts of war or public enemy, acts of any court, regulatory agency or administrative body having jurisdiction, insurrections, riots, strikes or other labor disturbances, embargoes or other causes of a similar nature.

SECTION 11.2. The Manager, including its officers, directors, employees, shareholders, agents, sub-contractors and any Submanager (the “Manager Related Parties”), shall be under no liability whatsoever to any member of the Group or to any third party (including the Crew) for any loss, damage, delay or expense of whatsoever nature, whether direct or indirect (including but not limited to loss of profit arising out of or in connection with detention of or delay to a Vessel), and howsoever arising in the course of the performance of this Agreement, any Shipmanagement Agreement or any Supervision Agreement, unless and to the extent that the same is proved to have resulted solely from the gross negligence or willful misconduct of the Manager, its officers, employees, agents, sub-contractors or any Submanager.

SECTION 11.3. Notwithstanding anything that may appear to the contrary in this Agreement or any Shipmanagement Agreement, the Manager shall not be liable for any of the actions of the Crew, even if such actions are negligent, grossly negligent or willful, except only to the extent that they are shown to have resulted from a failure by the

Manager to discharge its obligations under clause 3.1 of each Shipmanagement Agreement, in which case the Manager’s liability shall be limited in accordance with the terms of this Article XI.

SECTION 11.4. The Parent shall indemnify and hold harmless the Manager Related Parties against all actions, proceedings, claims, demands or liabilities whatsoever or howsoever arising which may be brought against them or incurred or suffered by them arising out of or in connection with the performance of this Agreement, any Shipmanagement Agreement or any Supervision Agreement and against and in respect of any loss, damage, delay or expense of whatsoever nature (including legal costs and expenses on a full indemnity basis), whether direct or indirect, incurred or suffered by any Manager Related Party arising out of or in connection with the performance of this Agreement, any Shipmanagement Agreement and any Supervision Agreement, unless incurred or suffered due to the gross negligence or willful misconduct of any Manager Related Party.

SECTION 11.5. It is hereby expressly agreed that no employee or agent of the Manager (including any sub-contractor from time to time employed by the Manager) shall in any circumstances whatsoever be under any liability whatsoever to any member of the Group or any third party for any loss, damage or delay of whatsoever kind arising or resulting directly or indirectly from any act, neglect or default on his part while acting in the course of or in connection with his employment or agency and, without prejudice to the generality of the foregoing provisions in this Article XI, every exemption, limitation, condition and liberty herein contained and every right, exemption from liability, defense and immunity of whatsoever nature applicable to the Manager or to which the Manager is entitled hereunder shall also be available and shall extend to protect every such employee or agent of the Manager acting as aforesaid, and for the purpose of all the foregoing provisions of this Article XI, the Manager is or shall be deemed to be acting as agent or trustee on behalf of and for the benefit of all persons who are or might be the Manager’s servants or agents from time to time (including sub-contractors as aforesaid) and all such persons shall to this extent be or be deemed to be parties to this Agreement. Nothing in this Section 11.5 shall be construed so as to further limit any liability the Manager may have to the Group under Section 11.2 hereof.

SECTION 11.6. The provisions of this Article XI shall survive any termination of this Agreement.

ARTICLE XII

RIGHTS OF THE MANAGER AND RESTRICTIONS ON THE MANAGER’S AUTHORITY

SECTION 12.1. Except as may be provided in this Agreement or in any separate written agreement between the Parent or any other member of the Group and the Manager or a Submanager, the Manager and any Submanager shall be an independent contractor and not the agent of the Parent or any other member of the Group and shall have no right or authority to incur any obligation on behalf of any member of the Group or to

bind any member of the Group in any way whatsoever. Nothing in this Agreement shall be deemed to make the Manager or any Submanager or any of their subsidiaries or employees an employee, joint venturer or partner of any member of the Group.

SECTION 12.2. The Parent acknowledges that the Manager or, as the case may be, any Submanager shall have no responsibility hereunder, direct or indirect, with regard to the formulation of the business plans, policies, management or strategies (financial, tax, legal or otherwise) of any member of the Group, which is solely the responsibility of each respective member of the Group. Each member of the Group shall set its corporate policies independently through its respective board of directors and executive officers and nothing contained herein shall be construed to relieve such directors or officers of each respective member of the Group from the performance of their duties or to limit the exercise of their powers.

SECTION 12.3. Notwithstanding the other provisions of this Agreement:


	(a) the Manager or, as the case may be, any Submanager may act with respect to a member of the Group upon any advice, resolutions, requests, instructions, recommendations, direction or information obtained from such member of the Group or any banker, accountant, broker, lawyer or other person acting as agent of or adviser to such member of the Group and the Manager or, as the case may be, the relevant Submanager shall incur no liability to such member of the Group for anything done or omitted or suffered in good faith in reliance upon such advice, instruction, resolution, recommendation, direction or information made or given by such member of the Group or its agents, in the absence of gross negligence or willful misconduct by the Manager or, as the case may be, the relevant Submanager or their respective servants, and shall not be responsible for any misconduct, mistake, oversight, error of judgment, neglect, default, omission, forgetfulness or want of prudence on the part of any such banker, accountant, broker, lawyer, agent or adviser or other person as aforesaid;

	(b) the Manager or, as the case may be, a Submanager shall not be under any obligation to carry out any request, resolution, instruction, direction or recommendation of any member of the Group or its agents if the performance thereof is or would be illegal or unlawful; and

	(c) the Manager or, as the case may be, the relevant Submanager shall incur no liability to any member of the Group for doing or failing to do any act or thing which it shall be required to do or perform or forebear from doing or performing by reason of any provision of any law or any regulation or resolution made pursuant thereto or any decision, order or judgment of any court or any lawful request, announcement or similar action of any person or body exercising or purporting to exercise the legitimate authority of any government or of any central or local


	governmental institution in each case where the above entity has jurisdiction.

ARTICLE XIII

TERMINATION OF THIS AGREEMENT

SECTION 13.1. This Agreement shall be effective as of the Effective Date and, subject to Sections 13.2, 13.3, 13.4 and 13.5, shall continue until the last day of the calendar year falling five years after the calendar year that the Effective Date falls in (the “Initial Term”). Thereafter the term of this Agreement shall be extended on a year-to-year basis for up to five times (each a “Subsequent Term”) unless the Parent, at least 12 months prior to the end of the then current term, gives written notice to the Manager that it wishes to terminate this Agreement at the end of the then current term. In no event will the term of this Agreement (the “Term”) extend beyond the date falling five years after the last day of the Initial Term.

SECTION 13.2. The Parent shall be entitled to terminate this Agreement by notice in writing to the Manager if:


	(a) the Manager defaults in the performance of any material obligation under this Agreement, subject to a cure right of 20 Business Days following written notice by the Parent, PROVIDED ALWAYS, that any default of the Manager to perform any of its obligations under a particular Shipmanagement Agreement or any Supervision Agreement, shall not, in itself, entitle the Parent to terminate this Agreement pursuant to this Section 13.2(a) and shall only allow the relevant member of the Group to terminate the relevant Shipmanagement Agreement or Supervision Agreement;

	(b) any moneys due and payable to the Parent or third parties by the Manager under this Agreement is not paid or accounted for within 10 Business Days following written notice by the Parent;

	(c) there is a Change of Control of the Manager; or

	(d) the Manager is convicted of, enters a plea of guilty or nolo contendere with respect to, or enters into a plea bargain or settlement admitting guilt for a crime (including, for the avoidance of doubt, fraud), which conviction, plea bargain or settlement is demonstrably and materially injurious to the Parent, PROVIDED ALWAYS, such crime is not a misdemeanor and PROVIDED ALWAYS further that such crime has been committed solely and directly by an officer or director of the Manager acting within the terms of its employment or office.

SECTION 13.3. The Manager shall be entitled to terminate this Agreement by notice in writing to the Parent if:


	(a) any moneys payable by the Parent under this Agreement is not paid when due or if due on demand within 20 Business Days following demand by the Manager;

	(b) the Parent defaults in the performance of any other material obligations under this Agreement, subject to a cure right of 20 Business Days following written notice by the Manager; or

	(c) there is a Change in Control of the Parent.

SECTION 13.4. Either party shall be entitled to terminate this Agreement by notice in writing to the other party if:


	(a) the other party ceases to conduct business, or all or substantially all of the equity-interests, properties or assets of such other party are sold, seized or appropriated which, in the case of seizure or appropriation, is not discharged within 20 Business Days;

	(b) (i) the other party files a petition under any bankruptcy law, makes an assignment for the benefit of its creditors, seeks relief under any law for the protection of debtors or adopts a plan of liquidation; (ii) a petition is filed against the other party seeking to have it declared insolvent or bankrupt and such petition is not dismissed or stayed within 90 Business Days of its filing; (iii) the other party shall admit in writing its insolvency or its inability to pay its debts as they mature; (iv) an order is made for the appointment of a liquidator, manager, receiver or trustee of the other party of all or a substantial part of its assets; (v) if an encumbrancer takes possession of or a receiver or trustee is appointed over the whole or a substantial part of the other party’s undertaking, property or assets; or (vi) if an order is made or a resolution is passed for the other party’s winding up;

	(c) the other party is prevented from performing its obligations hereunder, in any material respect, by reasons of Force Majeure for a period of two or more consecutive months; or

	(d) all Supervision Agreements and all Shipmanagement Agreements are terminated in accordance with the respective terms thereof.

SECTION 13.5. Upon the effective date of termination pursuant to this Article XIII, the Manager shall promptly terminate its service hereunder, after taking reasonable commercial steps to minimize any interruption to the business of the members of the Group.

SECTION 13.6. Upon termination, the Manager shall, as promptly as possible, submit a final accounting of funds received and disbursed under this Agreement, any Supervision Agreement and/or any Shipmanagement Agreement and of any remaining

Management Fees and/or any other funds due from the Parent or any other member of the Group, calculated pro rata to the date of termination, and any non-disbursed funds of any member of the Group in the Manager’s possession or control will be paid by the Manager as directed by such member of the Group promptly upon the Manager’s receipt of all sums then due to it under this Agreement, any Supervision Agreement and/or any Management Agreement, if any.

SECTION 13.7. Upon termination of this Agreement, the Manager shall release to the Parent the originals where possible, or otherwise certified copies, of all such accounts and all documents specifically relating to each Vessel or the provision of the Services.

SECTION 13.8. Upon termination of this Agreement either by the Manager for any reason (other than pursuant to Section 13.4(c)) or by the Parent pursuant to Section 13.1, the Parent shall be liable to pay to the Manager as liquidated damages an amount in U.S. Dollars equal to the lesser of (a) five times and (b) the number of full years remaining prior to the date falling five years after the last day of the Initial Term times, in each case, the aggregate fees due and payable to the Manager under the terms of this Agreement during the 12-month period ending on the date of termination of this Agreement (without taking into account any reduction to the fees payable to the Manager under Section 9.1(a) in the event that a Submanager has been appointed as provided therein), PROVIDED ALWAYS, that the amount of liquidated damages payable thereunder shall never be less than two times the aggregate fees due and payable to the Manager under the terms of this Agreement during the 12-month period ending on the date of termination of this Agreement.

SECTION 13.9. The provisions of this Article XIII shall survive any termination of this Agreement.

ARTICLE XIV
NOTICES

SECTION 14.1. All notices, consents and other communications hereunder, or necessary to exercise any rights granted hereunder, shall be in writing, sent either by prepaid registered mail or telefax, and will be validly given if delivered on a Business Day to an individual at the following address:


	Costamare Inc.
	▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
	▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇

	Telefax: ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
	Attention: CEO

	Costamare Shipping Company S.A.
	▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Syngrou Avenue,
	Palaio Faliro, Athens, Greece

Telefax: ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
Attention: Managing Director

ARTICLE XV

APPLICABLE LAW

SECTION 15.1. This Agreement and any non-contractual obligations connected with it shall be governed by, and construed in accordance with, the laws of England.

SECTION 15.2. Except for Sections 2.3, 3.5, 9.5 and 9.6 and Articles XI and XII which can be relied by a Submanager and Sections 2.3, 3.5, 9.5, 9.6 and 10.9 and Articles XI and XII which can be relied by a Related Manager, no other term of this Agreement is enforceable under the Contracts (Rights of Third Parties) ▇▇▇ ▇▇▇▇ by a person who is not a party to this Agreement.

ARTICLE XVI

ARBITRATION

SECTION 16.1. All disputes arising out of this Agreement and/or any non-contractual obligations connected with it shall be arbitrated in London in the following manner. One arbitrator is to be appointed by each of the parties hereto and a third by the two so chosen. Their decision or that of any two of them shall be final. The arbitrators shall be commercial persons, conversant with shipping matters. Such arbitration is to be conducted in accordance with the London Maritime Arbitration Association (LMAA) Terms current at the time when the arbitration proceedings are commenced and in accordance with the Arbitration Act 1996 or any statutory modification or re-enactment thereof.

SECTION 16.2. In the event that a party hereto shall state a dispute and designate an arbitrator in writing, the other party shall have 10 Business Days to designate its own arbitrator. If such other party fails to designate its own arbitrator within such period, the arbitrator appointed by the first party can render an award hereunder.

SECTION 16.3. Until such time as the arbitrators finally close the hearings, either party shall have the right by written notice served on the arbitrators and on the other party to specify further disputes or differences under this Agreement for hearing and determination.

SECTION 16.4. The arbitrators may grant any relief, and render an award, which they or a majority of them deem just and equitable and within the scope of this Agreement, including but not limited to the posting of security. Awards pursuant to this Article XVI may include costs and judgments may be entered upon any award made herein in any court having jurisdiction.

ARTICLE XVII

MISCELLANEOUS

SECTION 17.1. This Agreement constitutes the sole understanding and agreement of the parties hereto with respect to the subject matter hereof and supersedes all prior agreements or understandings, written or oral, with respect thereto. This Agreement may not be amended, waived or discharged except by an instrument in writing executed by the party against whom enforcement of such amendment, waiver or discharge is sought.

SECTION 17.2. During the term hereof, the Manager will not provide services hereunder through, or otherwise cause any member of the Group to have, an office or fixed place of business in the United States.

SECTION 17.3. This Agreement may be executed in one or more written counterparts, each of which shall be deemed an original, but all of which together shall constitute one instrument.

IN WITNESS WHEREOF the undersigned have executed this Agreement as of the date first above written.


COSTAMARE INC.

by


	Name:	▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇
	Title:	CEO

COSTAMARE SHIPPING COMPANY
S.A.

by


	Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
	Title: Director

SCHEDULE A

SHIPOWNING SUBSIDIARIES

1) Achilleas Maritime Corporation

2) Alexia Transport Corp.

3) Angistri Corporation

4) Bullow Investments Inc.

5) ▇▇▇▇▇▇ Shipping Co.

6) Capetanissa Maritime Corporation

7) Caravokyra Maritime Corporation

8) Christos Maritime Corporation

9) Costachille Maritime Corporation

10) Costis Maritime Corporation

11) ▇▇▇▇▇ Shipping Co.

12) Dino Shipping Co.

13) Fanakos Maritime Corporation

14) Fastsailing Maritime Co.

15) Flow Shipping Co.

16) Grappa Shipping Co.

17) Guildmore Navigation S.A.

18) ▇▇▇▇▇▇▇ Shipping Company

19) Kalamata Shipping Corporation

20) Kelsen Shipping Co.

21) Lang Shipping Co.

22) Lege Shipping Co.

23) Lytton Shipping Co.

24) Marathos Shipping Inc.

25) Marina Maritime Corporation

26) Marvista Maritime Inc.

27) Mas Shipping Co.

28) Mera Shipping Co.

29) Merin Shipping Co.

30) ▇▇▇▇▇▇ Shipping Co.

31) Miko Shipping Co.

32) ▇▇▇▇▇▇ Shipping Co.

33) Navarino Maritime Corporation

34) Ray Shipping Co.

35) ▇▇▇▇ Maritime Corporation

36) ▇▇▇▇ Shipping Co.

37) Takoulis Maritime Corporation

38) West End Shipping Co. Ltd.

39) Venor Shipping Co.

40) ▇▇▇▇ Shipping Co.

41) Uriza Shipping Co.

SCHEDULE B

NON-SHIPOWNING SUBSIDIARIES

1. Brookes Shipping Co.

2. ▇▇▇▇▇▇ Shipping Co.

3. Convey Shipping Co.

4. Cornas Shipping Co.

5. Davies Shipping Co.

6. Douro Shipping Co.

7. Dome Shipping Co.

8. Idea Shipping Co.

9. ▇▇▇▇ Shipping Co.

10. Nigel Shipping Co.

11. ▇▇▇▇▇ Shipping Co.

12. Royce Shipping Co.

13. Madelia Shipping Co.

14. ▇▇▇▇▇ Shipping Co.

15. ▇▇▇▇▇▇▇ Shipping Co.

16. Sea Elf Maritime Inc

17. Simone Shipping Co.

18. ▇▇▇▇▇ Shipping Co.

19. ▇▇▇▇▇▇▇ Shipping Co.

20. Cadence Shipping Co.

21. ▇▇▇▇▇ Shipping Co.

22. ▇▇▇▇▇ Shipping Co.

23. ▇▇▇ Shipping Co.

APPENDIX I

FORM OF SHIPMANAGEMENT AGREEMENT


	Approved by
	the Documentary Committee of The	Approved by
Printed by BIMCO’s idea	Japan Shipping Exchange Inc., Tokyo	the International Ship Managers’ Association (ISMA)


	1.	Date of Agreement [to be dated the date of execution]	THE BALTIC AND INTERNATIONAL MARITIME COUNCIL (BIMCO)
		Date of Agreement [to be dated the date of execution]
			STANDARD SHIP MANAGEMENT AGREEMENT

			CODE NAME: “▇▇▇▇▇▇▇ 98”

				PART I

	2.	Owners (name, place of registered office and law of registry) (CI. 1)	3.	Managers (name, place of registered office and law of registry) (CI. 1)

		Name		Name
		[name of relevant member of the Group]		Costamare Shipping Company S.A.

		Place of registered office		Place of registered office
		[to be completed]		Panama City, Republic of Panama

		Law of registry		Law of registry
		[to be completed]		Republic of Panama

	4.	Day and year of commencement of Agreement (Cl. 2) [to be completed on execution]

	5.	Crew Management (state “yes” or “no” as agreed) (Cl. 3.1) YES	6.	Technical Management (state “yes” or “no” as agreed) (Cl. 3.2) YES

	7.	Commercial Management (state “yes” or “no” as agreed) (Cl. 3.3) YES	8.	Insurance Arrangements (state “yes” or “no” as agreed) (Cl. 3.4) YES

	9.	Accounting Services (state “yes” or “no” as agreed) (CI. 3.5) YES	10.	Sale or purchase of the Vessel (state “yes” or “no” as agreed) (Cl. 3.6) YES

	11.	Provisions (state “yes” or “no” as agreed) (Cl. 3.7) YES	12.	Bunkering (state “yes” or “no” as agreed) (Cl. 3.8) YES

	13.	Chartering Services Period (only to be filled in if “yes” stated in Box 7) (Cl. 3.3(i)) 36 months (including any optional extensions applicable) and with a gross daily rate (or time charter equivalent) of US$[ ]	14.	Owners’ Insurance (state alternative (i), (ii) or (iii) of Cl. 6.3) Clause 6.3(ii)

	15.	~~Annual~~ Management Fee (state ~~annual~~ amount) (Cl. 8.1) See Clause 8.1	16.	Severance Costs (state maximum amount) (Cl. 8.4(ii)) not applicable

	17.	Day and year of termination of Agreement (Cl. 17) see Clause 17	18.	Law and Arbitration (state alternative 19.1, 19.2 or 19.3; if 19.3 place of arbitration must be stated) (Cl. 19) see Clause 19.1

	19.	Notices (state postal ~~and cable~~ address~~, telex~~ and telefax number for serving notice and communication to the Owners) (Cl. 20)	20.	Notices (state postal ~~and cable~~ address~~, telex~~ and telefax number for serving notice and communication to the Managers) (Cl. 20)
		C/o Costamare Inc.		▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Syngrou Avenue
		▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Syngrou Avenue		Athens, Greece
		Athens, Greece		Telefax: + 30 210 940 9051
		Telefax: + 30 210 940 6454		Attention: Chief Executive Officer
		Attention: Chief Executive Officer


It is mutually agreed between the party stated in Box 2 and the party stated in Box 3 that this Agreement consisting of PART I and PART II as well as Annexes “A” (Details of Vessel)~~, “B” (Details of Crew), “C” (Budget) and “D” (Associated vessels)~~ attached hereto, shall be performed subject to the conditions contained herein. In the event of a conflict of conditions, the provisions of PART I and Annex~~es “A”, “B”, “C” and “D”~~ shall prevail over those of PART II to the extent of such conflict but no further..

	Signature(s) (Owners)		Signature(s) (Managers)
		[name of relevant member of the Group]		COSTAMARE SHIPPING COMPANY S.A.

This document is a computer generated ▇▇▇▇▇▇▇ 98 form printed by authority of BIMCO. Any insertion or deletion to the form must be clearly visible. In the event of any modification made to the pre-printed text of this document which is not clearly visible, the text of the original BIMCO approved document shall apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original BIMCO approved document and this computer generated document.

A-A-1

Printed by BIMCO’s idea

ANNEX “A” (DETAILS OF VESSEL OR VESSELS) TO

THE BALTIC AND INTERNATIONAL MARITIME COUNCIL (BIMCO)

STANDARD SHIP MANAGEMENT AGREEMENT - CODE NAME: “▇▇▇▇▇▇▇ 98”

Date of Agreement:

[to be completed]

Name of Vessel(s):

[to be completed]

Particulars of Vessel(s):

[to be completed]

A-A-2

~~ANNEX “B” (DETAILS OF CREW) TO~~

~~THE BALTIC AND INTERNATIONAL MARITIME COUNCIL (BIMCO)~~

~~STANDARD SHIP MANAGEMENT AGREEMENT - CODE NAME: “▇▇▇▇▇▇▇ 98”~~

~~Date of Agreement:~~

~~Details of Crew:~~


~~Numbers~~	~~Rank~~	~~Nationality~~
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______
______	______	______

A-A-3

Printed by BIMCO’s idea

~~ANNEX “C” (BUDGET) TO~~

~~THE BALTIC AND INTERNATIONAL MARITIME COUNCIL (BIMCO)~~

~~STANDARD SHIP MANAGEMENT AGREEMENT - CODE NAME: “▇▇▇▇▇▇▇ 98”~~

~~Date of Agreement:~~

~~Managers’ Budget for the first year with effect from the Commencement Date of this Agreement:~~

A-A-4

~~ANNEX “D” (ASSOCIATED VESSELS) TO~~

~~THE BALTIC AND INTERNATIONAL MARITIME COUNCIL (BIMCO)~~

~~STANDARD SHIP MANAGEMENT AGREEMENT - CODE NAME: “▇▇▇▇▇▇▇ 98”~~

~~NOTE: PARTIES SHOULD BE AWARE THAT BY COMPLETING THIS ANNEX “D” THEY WILL BE SUBJECT TO THE PROVISIONS OF SUB-CLAUSE 18.1(i) OF THIS AGREEMENT.~~

~~Date of Agreement:~~

~~Details of Associated Vessels:~~

A-A-5

PART II
“▇▇▇▇▇▇▇ 98” Standard Ship Management Agreement


1.	Definitions	1
	In this Agreement save where the context otherwise requires,	2
	the following words and expressions shall have the meanings	3
	hereby assigned to them.	4

	“Owners” means the party identified in Box 2.	5
	“Managers” means the party identified in Box 3.	6
	“Vessel” means the vessel or vessels details of which are set	7
	out in Annex “A” attached hereto.	8
	“Business Day” shall have the same meaning as ascribed
	thereto in Section 1.1 of the Group Management Agreement.
	“Crew” means the Master, officers and ratings employed on the	9
	Vessel from time to time~~of the numbers,~~
	~~rank and nationality specified in Annex “B” attached hereto.~~	10
	~~“Crew Support Costs”~~ ~~means all expenses of a general nature~~	11
	~~which are not particularly referable to any individual vessel for~~	12
	~~the time being managed by the Managers and which are incurred~~	13
	~~by the Managers for the purpose of providing an efficient and~~	14
	~~economic management service and, without prejudice to the~~	15
	~~generality of the foregoing, shall include the cost of crew standby~~	16
	~~pay, training schemes for officers and ratings, cadet training~~	17
	~~schemes, sick pay, study pay, recruitment and interviews.~~	18
	“Related Manager” shall have the meaning as ascribed thereto	19
	in Section 1.1 of the Group Management Agreement.
	“Severance Costs” means the costs which the employers are
	legally obliged to pay to or in respect of the Crew as a result of	20
	the early termination of any employment contract for service on	21
	the Vessel.	22
	“Crew Insurances” means insurances against crew risks which	23
	shall include but not be limited to death, sickness, repatriation,	24
	injury, shipwreck unemployment indemnity and loss of personal	25
	effects.	26
	“Group Management Agreement” means the agreement dated [ ]
	2010 made between the Parent and the Managers.
	“Management Services” means the services specified in sub-	27
	clauses 3.1 to 3.8 as indicated affirmatively in Boxes 5 to 12.	28
	“ISM Code” means the International Management Code for the	29
	Safe Operation of Ships and for Pollution Prevention as adopted	30
	by the International Maritime Organization (IMO) by resolution	31
	A.741(18) or any subsequent amendment thereto.	32
	“ISPS Code” means the International Ship and Port Facility
	Security Code constituted pursuant to resolution A.924(22) of
	the International Maritime Organisation now set out in Chapter
	XI-2 of the International Convention for the Safety of Life at Sea
	(SOLAS) 1974 (as amended) and the mandatory ISPS Code as
	adopted by a Diplomatic Conference of the International
	Maritime Organisation on Maritime Security in December 2002
	and includes any amendments or extensions to it and any
	regulation issued pursuant to it.
	“Parent” means Costamare Inc. of Trust Company Complex,
	Ajeltake Road, Ajeltake Island, Majuro, Republic of the ▇▇▇▇▇▇▇▇
	▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇.
	“STCW 95” means the International Convention on Standards	33
	of Training, Certification and Watchkeeping for Seafarers, 1978,	34
	as amended in 1995 or any subsequent amendment thereto.	35

2.	Appointment of Managers	36
	With effect from the day and year stated in Box 4 and continuing	37
	unless and until terminated provided herein, the Owners	38
	hereby appoint the Managers as the technical and commercial managers of the Vessel and the Managers hereby agree	39
	to act as the technical and commercial Mmanagers of the ▇▇▇▇▇▇.	▇▇

▇.	Basis of Agreement	41
	Subject to the terms and conditions herein provided, during the	42
	period of this Agreement, the Managers shall carry out	43
	Management Services in respect of the Vessel as agents for	44
	and on behalf of the Owners. Subject to Section 4.6 of the Group	45
	Management Agreement, Tthe Managers shall have authority
	to take such actions as they may from time to time in their absolute	46
	discretion consider to be necessary to enable them to perform	47
	this Agreement in accordance with sound ship management	48
	practice.	49


3.1	Crew Management	50
(only applicable if agreed according to Box 5)		51
The Managers shall provide suitably qualified Crew for the Vessel		52
as required by the Owners in accordance with the STCW 95		53
requirements, provision of which includes but is not limited to		54
the following functions:		55
(i)	selecting and engaging the Vessel’s Crew, including payroll	56
	arrangements, pension administration, and insurances for	57
	the Crew other than those mentioned in Clause 6;	58
(ii)	ensuring that the applicable requirements of the law of the	59
	flag of the Vessel are satisfied in respect of ▇▇▇▇▇▇▇ levels,	60
	rank, qualification and certification of the Crew and	61
	employment regulations including Crew’s tax, social	62
	insurance, discipline and other requirements;	63
(iii)	ensuring that all members of the Crew have passed a medical	64
	examination with a qualified doctor certifying that they are fit	65
	for the duties for which they are engaged and are in possession	66
	of valid medical certificates issued in accordance with	67
	appropriate flag State requirements. In the absence of	68
	applicable flag State requirements the medical certificate shall	69
	be dated not more than three months prior to the respective	70
	Crew members leaving their country of domicile and	71
	maintained for the duration of their service on board the Vessel;	72
(iv)	ensuring that the Crew shall have a command of the English	73
	language of a sufficient standard to enable them to perform	74
	their duties safely;	75
(v)	arranging transportation of the Crew, including repatriation,	76
board and lodging as and when required at rates and types of
accommodations as customary in the industry;
(vi)	training of the Crew and supervising their efficiency;	77
(vii)	keeping and maintaining full and complete records of any	78
labor agreements which may be entered into with the Crew and,
if applicable, conducting union negotiations;
(viii)	operating the Managers’ drug and alcohol policy unless	79
	otherwise agreed in writing.	80

3.2	Technical Management	81
(only applicable if agreed according to Box 6)		82
The Managers shall provide technical management which		83
includes, but is not limited to, the following functions:		84
(i)	provision of competent personnel to supervise the	85
	maintenance and general efficiency of the Vessel;	86
(ii)	arrangement and supervision of dry dockings, repairs,	87
	alterations and the upkeep of the Vessel to the standards	88
	required by the Owners provided that the Managers shall	89
	be entitled to incur the necessary expenditure to ensure	90
	that the Vessel will comply with the law of the flag of the	91
	Vessel and of the places where she trades, and all	92
	requirements and recommendations of the classification	93
	society;	94
(iii)	arrangement of the supply of necessary stores, spares and	95
	lubricating oil;	96
(iv)	appointment of surveyors and technical consultants as the	97
	Managers may consider from time to time to be necessary;	98
(v)	development, implementation and maintenance of a Safety	99
	Management System (SMS) in accordance with the ISM	100
	Code (see sub-clauses 4.2 and 5.3) and of a security system in	101
	accordance with the ISPS Code;
	(vi) handling any claims against the builder of the Vessel
	arising out of the relevant shipbuilding contract, if
	applicable; and
	(vii) on request by the Owners, providing the Owners with a
	copy of any inspection report, survey, valuation or any other
	similar report prepared by any shipbrokers, surveyors, the
	Class etc..

3.3	Commercial Management	102
(only applicable if agreed according to Box 7)		103
The Managers shall provide the commercial operation of the		104
Vessel~~, as required by the Owners~~, which includes, but is not		105
limited to, the following functions:		106
(i)	providing chartering services ~~in accordance with the Owners’~~	107

A-A-6

PART II
“▇▇▇▇▇▇▇ 98” Standard Ship Management Agreement


	~~instructions~~ which include, but are not limited to, seeking	108
	and negotiating employment for the Vessel and the conclusion	109
	(including the execution thereof) of charter parties or other	110
	contracts relating to the employment of the Vessel, whether on a voyage, time, demise, contract of affreightment or other basis. If such a	111
	contract exceeds the period and is for a rate that is less than the rate, in either case, stated in Box 13, consent thereto	112
	in writing shall first be obtained from the Owners.	113
(ii)	arranging of the proper payment to Owners or their nominees	114
	of all hire and/or freight revenues or other moneys of	115
	whatsoever nature to which Owners may be entitled arising	116
	out of the employment of or otherwise in connection with the	117
	Vessel;.	118
(iii)	providing voyage estimates and accounts and calculating of	119
	hire, freights, demurrage and/or despatch moneys due from	120
	or due to the charterers of the Vessel;	121
(iv)	issuing to the Crew of appropriate voyage instructions and monitoring voyage performance;	122
(v)	appointing agents;	123
(vi)	appointing stevedores;	124
(vii)	arranging surveys associated with the commercial operation	125
	of the Vessel;	126
	(viii) carrying out the necessary communications with the shippers, charterers and others involved with the receiving and handling of the Vessel at the relevant loading and discharging ports, including sending any notices required under the terms of the Vessel’s employment at the time; (ix) invoicing on behalf of the Owners all freights, hires, demurrages, outgoing claims, refund of taxes, balances of disbursements, statements of account and other sums due to the Owners and account receivables arising from the operation of the Vessel and, upon the request of the Owners, issuing releases on behalf of the Owners upon receipt of payment or settlement of any such amounts; (x) preparing off-hire statements and/or hire statements; (xi) procuring and arranging for port entrance and clearance, pilots, consular approvals and other services necessary for the management and safe operation of the Vessel; and (xii) reporting to the Owners of any major casualties, damages received or caused by the Vessel or any major release or discharge of oil or other hazardous material not in compliance with any laws.

3.4	Insurance Arrangements’	127
(only applicable if agreed according to Box 8)		128
The Managers shall arrange insurances in accordance with		129
Clause 6, on such terms and conditions as the Owners shall		130
have instructed or agreed, in particular regarding underwriters, conditions,		131
insured values, deductibles and franchises.		132

3.5	Accounting Services	133
(only applicable if agreed according to Box 9)		134
Without prejudice to the relevant provisions of the Group		135
Management Agreement and, in particular, but without
limitation, Section 4.11, Section 5.1 and Section 10.6 thereof,Tthe Managers
shall:
(i)	establish an accounting system which meets the	136
	requirements of the Owners and provide regular accounting	137
	services, supply regular reports and records,	138
(ii)	maintain the records of all costs and expenditure incurred	139
	as well as data necessary or proper for the settlement of	140
	accounts between the parties.	141

3.6	Sale or Purchase of the Vessel	142
(only applicable if agreed according to Box 10)		143
The Managers shall, in accordance with the Owners’ instructions,		144
supervise the sale or purchase of the Vessel, including the		145
performance of any sale or purchase agreement, but not		146
negotiation of the same. The Managers shall, on the request of the		147
Owners, either directly or by employing the services of a broker,
endeavor to procure a buyer for the Vessel at a price and
otherwise on terms acceptable to the Owners.
3.7	Provisions (only applicable if agreed according to Box 11)	148


	The Managers shall arrange for the supply of provisions.		149

	3.8	Bunkering (only applicable if agreed according to *Box 12* )	150
	The Managers shall arrange for the provision of bunker fuel of the		151
	quality specified by the Owners as required for the Vessel’s trade.		152

4.	Managers’ Obligations		153
	4.1	Without prejudice to the relevant provisions of the Group	154
	Management Agreement and in particular, but without limitation
	to the foregoing, the provisions of Section 2.3, Section 4.1,
	Section 4.5 and Section 4.7 thereof, Tthe Managers undertake to
	use their ~~best endeavours~~ commercially reasonable efforts to
	provide the agreed Management Services as agents for and on		155
	behalf of the Owners in accordance with sound ship management		156
	practice and to protect and promote the interests of the Owners in		157
	all matters relating to the provision of services hereunder.		158
	Provided, however, that the Managers in the performance of their		159
	management responsibilities under this Agreement shall be entitled		160
	to have regard to their overall responsibility in relation to all vessels		161
	as may from time to time be entrusted to their management and		162
	in particular, but without prejudice to the generality of the foregoing,		163
	the Managers shall be entitled to allocate available supplies,		164
	manpower and services in such manner as in the prevailing		165
	circumstances the Managers in their absolute discretion consider		166
	to be fair and reasonable.		167
	4.2	Where the Managers are providing Technical Management	168
	in accordance with sub-clause 3.2, they shall procure that the		169
	requirements of the law of the flag of the Vessel are satisfied and		170
	they shall in particular be deemed to be the “Company” as defined		171
	by the ISM Code, assuming the responsibility for the operation of		172
	the Vessel and taking over the duties and responsibilities imposed		173
	by the ISM Code and/or the ISPS Code when applicable.		174

5.	Owners’ Obligations		175
	5.1	Without prejudice to the relevant provisions of the Group	176
	Management Agreement, Tthe Owners shall pay all sums due to
	the Managers punctually
	in accordance with the terms of this Agreement.		177
	5.2	Where the Managers are providing Technical Management	178
	in accordance with sub-clause 3.2, the Owners shall:		179
	(i)	procure that all officers and ratings supplied by them or on	180
		their behalf comply with the requirements of STCW 95;	181
	(ii)	instruct such officers and ratings to obey all reasonable orders	182
		of the Managers in connection with the operation of the	183
		Managers’ safety management system.	184
	5.3	Where the Managers are not providing Technical Management	185
	in accordance with sub-clause 3.2, the Owners shall procure that		186
	the requirements of the law of the flag of the Vessel are satisfied		187
	and that they, or such other entity as may be appointed by them		188
	and identified to the Managers, shall be deemed to be the		189
	“Company” as defined by the ISM Code assuming the responsibility		190
	for the operation of the Vessel and taking over the duties and		191
	responsibilities imposed by the ISM Code when applicable.		192

6.	Insurance Policies		193
	The Owners shall procure, ~~whether~~ by instructing the Managers		194
	under sub-clause 3.4 ~~or otherwise,~~ that throughout the period of		195
	this Agreement:		196
	6.1	at the Owners’ expense, the Vessel is insured for not less	197
	than her sound market value or entered for her full gross tonnage,		198
	as the case may be for:		199
	(i)	usual hull and machinery marine risks (including crew	200
		negligence) and excess liabilities;	201
	(ii)	protection and indemnity risks (including pollution risks and	202
		Crew Insurances);~~and~~	203
	(iii)	war risks (including protection and indemnity and crew risks);	204
	and
	(iv)	any other insurance that the Owners determine or the Managers advise them in writing that, in either case, it is prudent or, as the case may be, appropriate on the basis of prevailing market practices to be obtained in respect of the Vessel, its freight/hire or any third party liabilities,
	in each case in accordance with the best practice of prudent owners		205
	of

A-A-7

PART II
“▇▇▇▇▇▇▇ 98” Standard Ship Management Agreement


	vessels of a similar type to the Vessel, with first class insurance		206
	companies, underwriters or associations (“the Owners’		207
	Insurances”);		208
	6.2	all premiums and calls and applicable deductibles and/or	209
	franchises on the Owners’ Insurances are paid
	promptly by their due date,		210
	6.3	the Owners’ Insurances name the Managers and, subject	211
	to underwriters’ agreement, any third party designated by the		212
	Managers as a joint assured, with full cover, with the Owners		213
	obtaining cover in respect of each of the insurances specified in		214
	sub-clause 6.1:		215
	(i)	on terms whereby the Managers and any such third party	216
		are liable in respect of premiums or calls arising in connection	217
		with the Owners’ Insurances; or	218
	(ii)	if reasonably obtainable, on terms such that neither the	219
		Managers nor any such third party shall be under any	220
		liability in respect of premiums or calls arising in connection	221
		with the Owners’ Insurances; or	222
	(iii)	on such other terms as may be agreed in writing.	223
	Indicate alternative (i), (ii) or (iii) in ▇▇▇ ▇▇. If Box 14 is left		224
	blank then (i) applies.		225
	6.4	written evidence is provided, to the reasonable satisfaction	226
	of the Managers, of their compliance with their obligations under		227
	Clause 6 within a reasonable time of the commencement of		228
	the Agreement, and of each renewal date and, if specifically		229
	requested, of each payment date of the Owners’ Insurances.		230

7.	Income Collected and Expenses Paid on Behalf of Owners		231
	7.1	Without prejudice to the provisions of Section 10.7 of the	232
	Group Management Agreement, Aall moneys collected by the
	Managers under the terms of
	this Agreement (other than moneys payable by the Owners to		233
	the Managers) and any interest thereon shall be held to the		234
	credit of the Owners in a separate bank account.		235
	7.2	Without prejudice to the provisions of Section 9.7, Section	236
	10.5 and Section 10.8 of the Group Management Agreement, Aall
	expenses incurred by the Managers under the terms
	of this Agreement on behalf of the Owners (including expenses		237
	as provided in Clause 8) may be debited against the Owners		238
	in the account referred to under sub-clause 7.1 but shall in any		239
	event remain payable by the Owners to the Managers on		240
	demand. For the avoidance of doubt, the Managers can make		241
	such demand on the Owners as well as on the Parent as
	provided in Section 10.5 of the Group Management Agreement.
	Furthermore and without prejudice to the generality of the
	provisions of this Clause 7, the Managers shall, subject to being
	placed in funds by the Owners or the Parent, arrange for the
	payment of all ordinary charges incurred in connection with the
	Management Services, including, but not limited to, all canal
	tolls, port charges, amounts due to any governmental
	authority with respect to the Crew and all duties and taxes in
	respect of the Vessel, the cargo, hire or freight (whether levied
	against the Owners, the Parent or the Vessel), insurance
	premiums, advances of balances of disbursements, invoices for
	bunkers, stores, spares, provisions, repairs and any other
	material and/or service in respect of the Vessel.

8.	Management Fee		242
	8.1	The Owners shall pay to the Managers for their services	243
	as Managers under this Agreement ~~an annual~~ the management		244
	fees as stated in ~~Box 15~~ Section 9.1(a) and Section 9(b) of the		245
	Group Management Agreement which shall be payable ~~by equal~~
	~~monthly instalments in advance, the first instalment being~~ monthly		246
	in accordance with the provisions of Article IX of the Group
	Management Agreement.
	~~payable on the commencement of this Agreement (see Clause~~		247
	2 ~~and Box 4) and subsequent instalments being payable every~~		248
	~~month.~~		249
	8.2	The management fee shall be subject to ~~an annual~~ review	250
	in accordance with the provisions of Sections 9.2 and 9.3 of the		251
	Group Management Agreement ~~on the anniversary date of the~~
	~~Agreement and the proposed~~
	~~fee shall be presented in the annual budget referred to in sub-~~		252
	~~clause 9.1.~~		253
	8.3	~~The Managers shall, at no extra cost to the Owners, provide~~	254
	~~their own office accommodation, office staff, facilities and~~		255
	~~stationery.~~ Without limiting the generality of Clause 7 the Owners		256


	shall reimburse the Managers for postage and communication		257
	expenses, travelling expenses, and other out of pocket		258
	expenses properly incurred by the Managers in pursuance of		259
	the Management Services.		260
	8.4	The provisions of Section 9.4, Section 9.5, Section 9.6 and Section 9.7 of	261
	the Group Management Agreement shall be deemed as
	incorporated herein mutatis mutandis.
	8.5	The Managers have the right to demand the payment of any
	of the management fees and expenses payable under this
	Agreement either from the Parent or the Owners. Payment of
	any such fees or expenses or any part thereof by either the
	Parent or the Owners shall prevent the Managers from making a
	claim on the other person for the same amount to the extent
	that the same has been already paid to the Managers.
	~~In the event of the appointment of the Managers being~~
	~~terminated by the Owners or the Managers in accordance with~~		262
	~~the provisions of Clauses 17 and 18 other than by reason of~~		263
	~~default by the Managers, or if the Vessel is lost, sold or otherwise~~		264
	~~Disposed of, the “management fee” payable to the Managers~~		265
	~~According to the provisions of sub-clause 8.1, shall continue to~~		266
	~~be payable for a further period of three calendar months as~~		267
	~~from the termination date. In addition, provided that the~~		268
	~~Managers provide Crew for the Vessel in accordance with sub-~~		269
	~~clause- 3,1:~~		270
	~~(i)~~	~~the Owners shall continue to pay Crew Support Costs during~~	271
		~~the said further period of three calendar months and~~	272
	~~(ii)~~	~~the Owners shall pay an equitable proportion of any~~	273
		~~Severance Costs which may materialize, not exceeding~~	274
		~~the amount stated in Box 16.~~	275
	~~8.5~~	~~If the Owners decide to lay up the Vessel whilst this~~	276
	~~Agreement remains in force and such lay up lasts for more~~		277
	~~than three months, an appropriate reduction of the management~~		278
	~~fee for the period exceeding three months until one month~~		279
	~~before the Vessel is again put into service shall be mutually~~		280
	~~agreed between the parties.~~		281
	~~8.6~~ ~~Unless otherwise agreed in writing all discounts and~~		282
	~~commissions obtained by the Managers in the course of the~~		283
	~~management of the Vessel shall be credited to the Owners.~~		284

9.	Budgets and Management of Funds		285
	9.1	The Owners are aware that the Managers will be preparing	286
	budgets in connection with, inter alia, the provision of the
	Management Services which the Managers will be submitting
	for approval to the Parent in accordance with the provisions of
	Article X of the Group Management Agreement.~~The Managers~~
	~~shall present to the Owners annually a~~
	~~budget for the following twelve months in such form as the~~		287
	~~Owners require. The budget for the first year hereof is set out~~		288
	~~in Annex “C” hereto. Subsequent annual budgets shall be~~		289
	~~prepared by the Managers and submitted to the Owners not~~		290
	~~less than three months before the anniversary date of the~~		291
	~~commencement of this Agreement (see Clause 2 and Box 4).~~		292
	~~9.2~~ ~~The Owners shall indicate to the Managers their acceptance~~		293
	~~and approval of the annual budget within one month of~~		294
	~~presentation and in the absence of any such indication the~~		295
	~~Managers shall be entitled to assume that the Owners have~~		296
	~~accepted the proposed budget.~~		297
	~~9.3~~ ~~Following the agreement of the budget, the Managers shall~~		298
	~~prepare and present to the Owners their estimate of the working~~		299
	~~capital requirement of the Vessel and the Managers shall each~~		300
	~~month up date this estimate. Based thereon,~~ Without prejudice to		301
	the right of the Managers to ask for funds in relation to the
	Management Services directly from the Parent in accordance
	with the relevant provisions of the Group Management
	Agreement, the Managers shall
	each month request the Owners in writing for the funds required		302
	to run the Vessel for the ensuing month, including the payment		303
	of any occasional or extraordinary item of expenditure, such as		304
	emergency repair costs, additional insurance premiums, bunkers		305
	or provisions. Such funds shall be received by the Managers		306
	within ten running days after the receipt by the Owners of the		307
	Managers’ written request and shall be held ~~to the credit of the~~		308
	~~Owners~~ in a separate bank account in the name of the Managers		309
	or, if requested by the Managers, in the name of the Owners.
	~~9.4~~ ~~The Managers shall produce a comparison between~~		310

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	~~budgeted and actual income and expenditure of the Vessel in~~		311
	~~such form as required by the Owners monthly or at such other~~		312
	~~intervals as mutually agreed.~~		313
	9.5	Notwithstanding anything contained herein to the contrary,	314
	the Managers shall in no circumstances be required to use or		315
	commit their own funds to finance the provision of the		316
	Management Services.		317

10.	Managers’ Right to Sub-Contract		318
	Except to a Related Manager (where the Manager may		319
	subcontract any of their obligations hereunder, without need of
	obtaining the Owner’s consent for doing so), Tthe Managers
	shall not have the right to sub-contract any of
	their obligations hereunder, including those mentioned in sub-		320
	clause 3.1, without the prior written consent of the Owners which		321
	shall not be unreasonably withheld and which shall be promptly		322
	responded to. In the event of such a sub-
	contract the Managers shall remain fully liable for the due		323
	performance of their obligations under this Agreement.		324

11.	Responsibilities		325
			326
	The parties agree that the provisions of Sections 11.1 to 11.5
	(inclusive) of the Group Management Agreement, shall apply to
	this Agreement mutatis mutandis, save that references therein
	to “any Shipmanagement Agreement or any Supervision
	Agreement” shall be omitted and references to “Parent”, “any
	member of the Group”, “Manager”, “any Submanager”, “a
	Vessel”, “Section”, “Management Fees”, “each
	Shipmanagement Agreement”, “Group” and “Article XI” shall be
	construed as references to the Owners, the Owners, the
	Managers, any submanager, the Vessel, Clause, management
	fee, this Agreement, the Owners and Clause 11, respectively,
	when used herein.

	~~11.1~~	*Force Majeure* - Neither the Owners nor the Managers
	~~shall be under any liability for any failure to perform any of their~~		327
	~~obligations hereunder by reason of any cause whatsoever of~~		328
	~~any nature or kind beyond their reasonable control.~~		329
	~~11.2~~	Liability to Owners - (i) Without prejudice to sub-clause	330
	~~11.1, the Managers shall be under no liability whatsoever to the~~		331
	~~Owners for any loss, damage, delay or expense of whatsoever~~		332
	~~nature, whether direct or indirect (including but not limited to~~		333
	~~loss of profit arising out of or in connection with detention of or~~		334
	~~delay to the Vessel) and howsoever arising in the course of~~		335
	~~performance of the Management Services UNLESS same is~~		336
	~~proved to have resulted solely from the negligence, gross~~		337
	~~negligence or wilful default of the Managers or their employees,~~		338
	~~or agents or sub-contractors employed by them in connection~~		339
	~~with the Vessel, in which case (save where loss, damage, delay~~		340
	~~or expense has resulted from the Managers’ personal act or~~		341
	~~omission committed with the intent to cause same or recklessly~~		342
	~~and with knowledge that such loss, damage, delay or expense~~		343
	~~would probably result) the Managers’ liability for each incident~~		344
	~~or series of incidents giving rise to a claim or claims shall never~~		345
	~~Exceed a total of ten times the annual management fee payable~~		346
	~~hereunder.~~		347
	~~(ii)~~ ~~Notwithstanding anything that may appear to the contrary in~~		348
	~~this Agreement, the Managers shall not be liable for any of the~~		349
	~~actions of the Crew, even if such actions are negligent, grossly~~		350
	~~negligent or wilful, except only to the extent that they are shown~~		351
	~~to have resulted from a failure by the Managers to discharge~~		352
	~~their obligations under sub-clause 3.1, in which case their liability~~		353
	~~shall be limited in accordance with the terms of this Clause 11.~~		354
	~~11.3~~	Indemnity - Except to the extent and solely for the amount	355
	~~therein set out that the Managers would be liable under sub-~~		356
	~~clause 11.2, the Owners hereby undertake to keep the Managers~~		357
	~~and their employees, agents and sub-contractors indemnified~~		358
	~~and to hold them harmless against all actions, proceedings,~~		359
	~~claims, demands or liabilities whatsoever or howsoever arising~~		360
	~~which may be brought against them or incurred or suffered by~~		361
	~~them arising out of or in connection with the performance of the~~		362
	~~Agreement, and against and in respect of all costs, losses,~~		363


	~~damages and expenses (including legal costs and expenses on~~		364
	~~a full indemnity basis) which the Managers may suffer or incur~~		365
	~~(either directly or indirectly) in the course of the performance of~~		366
	~~this Agreement.~~		367
	~~11.4~~	“Himalaya” It is hereby expressly agreed that no	368
	~~employee or agent of the Managers (including every sub-~~		369
	~~contractor from time to time employed by the Managers) shall in~~		370
	~~Any circumstances whatsoever be under any liability whatsoever~~		371
	~~to the Owners for any loss, damage or delay of whatsoever kind~~		372
	~~arising or resulting directly or indirectly from any act, neglect or~~		373
	~~default on his part while acting in the course of or in connection~~		374
	~~with his employment and, without prejudice to the generality of~~		375
	~~the foregoing provisions in this Clause 11, every exemption,~~		376
	~~limitation, condition and liberty herein contained and every right,~~		377
	~~exemption from liability, defence and immunity of whatsoever~~		378
	~~nature applicable to the Managers or to which the Managers are~~		379
	~~entitled hereunder shall also be available and shall extend to~~		380
	~~protect every such employee or agent of the Managers acting~~		381
	~~as aforesaid and for the purpose of all the foregoing provisions~~		382
	~~of this Clause 11 the Managers are or shall be deemed to be~~		383
	~~acting as agent or trustee on behalf of and for the benefit of all~~		384
	~~persons who are or might be their servants or agents from time~~		385
	~~to time (including sub-contractors as aforesaid) and all such~~		386
	~~persons shall to this extent be or be deemed to be parties to this~~		387
	~~Agreement.~~		388

12.	Documentation		389
	Without prejudice to the relevant provisions of the Group		390
	Management Agreement, Wwhere the Managers are providing
	Technical Management in
	accordance with sub-clause 3.2 and/or Crew Management in		391
	accordance with sub-clause 3.1, they shall make available,		392
	upon Owners’ request, all documentation and records related		393
	to the Safety Management System (SMS) and/or the Crew		394
	which the Owners need in order to demonstrate compliance		395
	with the ISM Code, the ISPS Code and STCW 95 or to defend a		396
	claim against
	a third party.		397

13.	General Administration		398
	3.1	Without prejudice to the provisions of Article V of the	399
	Group Management Agreement, but subject to the provisions of
	Section 4.6 of the Group Management Agreement, Tthe
	Managers shall handle and settle all claims arising
	out of the Management Services hereunder and keep the Owners		400
	informed regarding any incident of which the Managers become		401
	aware which gives or may give rise to material claims or disputes		402
	involving
	third parties.		403
	13.2	The Managers shall, as instructed by the Owners under this	404
	Agreement and/or, as the case may be, Section 4.6 of the Group
	Management Agreement, bring
	or defend actions, suits or proceedings in connection with matters		405
	entrusted to the Managers according to this Agreement.		406
	13.3	The Managers shall also have power to obtain legal or	407
	technical or other outside expert advice in relation to the handling		408
	and settlement of claims and disputes or all other matters		409
	affecting the interests of the Owners in respect of the Vessel.		410
	13.4	The Owners shall arrange for the provision of any	411
	necessary guarantee bond or other security.		412
	13.5	Any costs ~~reasonably~~ incurred by the Managers in	413
	carrying out their obligations according to Clause 13 shall be		414
	reimbursed by the Owners.		415

14.	Auditing		416
	The Managers shall at all times maintain and keep true and		417
	correct accounts and shall make the same available for inspection		418
	and auditing by the Owners at such times as may be mutually		419
	agreed. On the termination, for whatever reasons, of this		420
	Agreement, the Managers shall release to the Owners, if so		421
	requested, the originals where possible, or otherwise certified		422
	copies, of all such accounts and all documents specifically relating		423
	to the Vessel and her operation. For the avoidance of any doubt,		424
	this Clause is in addition to and not in substitution of the

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“▇▇▇▇▇▇▇ 98” Standard Ship Management Agreement


	relevant provisions of the Group Management Agreement.
15.	Inspection of Vessel			425
	The Owners shall have the right at any time after giving			426
	reasonable notice to the Managers to inspect the Vessel for any			427
	reason they consider necessary.			428

16.	Compliance with Laws and Regulations			429
	The Managers will not do or permit to be done anything which			430
	might cause any breach or infringement of the laws and			431
	regulations of the Vessel’s flag, or of the places where she trades.			432

17.	Duration of the Agreement			433
	This Agreement shall come into effect on the day and year stated			434
	in Box 4 and shall continue until the date the Group Management			435
	Agreement is terminated in accordance with the provisions of
	Article XIII thereof, unless this Agreement is terminated earlier
	in accordance with the provision of Clause 18 hereof~~the date~~
	~~stated in Box 17.~~
	~~Thereafter it shall continue until terminated by either party giving~~			436
	~~to the other notice in writing, in which event the Agreement shall~~			437
	~~terminate upon the expiration of a period of two months from the~~			438
	~~date upon which such notice was given.~~			439

18.	Termination			440
	18.1	*Owners’ default*		441
	(i)	The Managers shall be entitled to terminate the Agreement		442
		with immediate effect by notice in writing if any moneys		443
		payable by the Owners under this Agreement ~~and/or the~~		444
		~~owners of any associated vessel, details of which are listed~~		445
		~~in Annex “D”,~~ shall not have been received in the Managers’		446
		nominated account within ~~ten~~20 ~~running~~ Business dDays of		447
		receipt by
		the Owners of the Managers written request or if the Vessel		448
		is repossessed by the Mortgagees.		449
	(ii)	If the Owners:		450
		(a)	fail to meet their obligations under sub-clauses 5.2	451
			and 5.3 of this Agreement for any reason within their	452
			control, or	453
		(b)	proceed with the employment of or continue to employ	454
			the Vessel in the carriage of contraband, blockade	455
			running, or in an unlawful trade, or on a voyage which	456
			in the reasonable opinion of the Managers is unduly	457
			hazardous or improper,	458
		the Managers may give notice of the default to the Owners,		459
		requiring them to remedy it as soon as practically possible.		460
		In the event that the Owners fail to remedy it within a		461
		~~reasonable time~~ 20 Business Days of receipt by the Owners		462
		of the Managers’ written request to the satisfaction of the
		Managers, the
		Managers shall be entitled to terminate the Agreement		463
		with immediate effect by notice in writing.		464
	18.2	*Managers’ Default*		465
	If the Managers fail to meet their obligations under Clauses 3			466
	and 4 of this Agreement for any reason within the control of the			467
	Managers, the Owners may give notice to the Managers of the			468
	default, requiring them to remedy it within 20 Business Daysas			469
	~~soon as practically~~
	~~possible~~. In the event that the Managers fail to remedy it within a			470
	~~reasonable time~~such period to the satisfaction of the Owners, the			471
	Owners
	shall be entitled to terminate the Agreement with immediate effect			472
	by notice in writing.			473
	18.3	*Extraordinary Termination*		474
	This Agreement shall be deemed to be terminated in the case of			475
	the sale of the Vessel or if the Vessel becomes a total loss or is			476
	declared as a constructive or compromised or arranged total			477
	loss or is requisitioned.			478
	18.4	For the purpose of sub-clause 18.3 hereof		479
	(i)	the date upon which the Vessel is to be treated as having		480
		been sold or otherwise disposed of shall be the date on		481
		which the Owners cease to be registered as Owners of		482
		the Vessel;		483
	(ii)	the Vessel shall not be deemed to be lost unless either		484


		she has become an actual total loss or agreement has	485
		been reached with her underwriters in respect of her	486
		constructive, compromised or arranged total loss or if such	487
		agreement with her underwriters is not reached it is	488
		adjudged by a competent tribunal that a constructive loss	489
		of the Vessel has occurred.	490
	18.5	The parties agree that the provisions of Sections 13.4(a) to	491
	13.4 (d) (inclusive) of the Group Management Agreement, shall
	apply to this Agreement mutatis mutandis. ~~This Agreement shall~~
	~~terminate forthwith in the event of~~
	~~an order being made or resolution passed for the winding up,~~		492
	~~dissolution, liquidation or bankruptcy of either party (otherwise~~		493
	~~than for the purpose of reconstruction or amalgamation) or if a~~		494
	~~receiver is appointed, or if it suspends payment, ceases to carry~~		495
	~~on business or makes any special arrangement or composition~~		496
	~~with its creditors.~~		497
	18.6	The termination of this Agreement shall be without	498
	prejudice to all rights accrued due between the parties prior to		499
	the date of termination.		500

19.	Law and Arbitration		501
	19.1	This Agreement and any non-contractual obligations	502
	connected with it shall be governed by and construed in
	accordance with English law. All disputes arising out of this		503
	Agreement and/or any non-contractual obligations connected
	with it shall be arbitrated in London in the following manner.
	One arbitrator is to be appointed by each of the parties hereto
	and a third by the two so chosen. Their decision or that of any
	two of them shall be final. The arbitrators shall be commercial
	persons, conversant with shipping matters. Such arbitration is
	to be conducted in accordance with the London Maritime
	Arbitration Association (LMAA) Terms current at the time when
	the arbitration proceedings are commenced and in accordance
	with the Arbitration Act 1996 or any statutory modification or re-
	enactment thereof. In the event that a party hereto shall state a
	dispute and designate an arbitrator in writing, the other party
	shall have 10 Business Days to designate its own arbitrator. If
	such other party fails to designate its own arbitrator within such
	period, the arbitrator appointed by the first party can render an
	award hereunder. Until such time as the arbitrators finally close
	the hearings, either party shall have the right by written notice
	served on the arbitrators and on the other party to specify
	further disputes or differences under this Agreement for hearing
	and determination. The arbitrators may grant any relief, and
	render an award, which they or a majority of them deem just and
	equitable and within the scope of this Agreement, including but
	not limited to the posting of security. Awards pursuant to this
	Clause 19.1 may include costs and judgments may be entered
	upon any award made herein in any court having jurisdiction.
	~~and any dispute arising out of or~~
	~~in connection with this Agreement shall be referred to arbitration~~		504
	~~in London in accordance with the Arbitration Act 1996- or~~		505
	~~any statutory modification or re-enactment thereof save to~~		506
	~~the extent necessary to give effect to the provisions of this~~		507
	~~Clause.~~		508
	~~The arbitration shall be conducted in accordance with the~~		509
	~~London Maritime Arbitrators Association (LMAA) Terms~~		510
	~~current at the time when the arbitration proceedings are~~		511
	~~commenced.~~		512
	~~The reference shall be to three arbitrators. A party wishing~~		513
	~~to refer a dispute to arbitration shall appoint its arbitrator~~		514
	~~and send notice of such appointment in writing to the other~~		515
	~~party requiring the other party to appoint its own arbitrator~~		516
	~~within 14 calendar days of that notice and stating that it will~~		517
	~~appoint its arbitrator as sole arbitrator unless the other party~~		518
	~~appoints its own arbitrator and gives notice that it has done~~		519
	~~so within the 14 days specified. If the other party does not~~		520
	~~appoint its own arbitrator and give notice that it has done so~~		521
	~~within the 14 days specified, the party referring a dispute to~~		522
	~~arbitration may, without the requirement of any further prior~~		523
	~~notice to the other party, appoint its arbitrator as sole~~		524
	~~arbitrator and shall advise the other party accordingly. The~~		525
	~~award of a sole arbitrator shall be binding on both parties~~		526

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“▇▇▇▇▇▇▇ 98” Standard Ship Management Agreement


	~~as if he had been appointed by agreement.~~		527
	~~Nothing herein shall prevent the parties agreeing in writing~~		528
	~~to vary these provisions to provide for the appointment of a~~		529
	~~sole arbitrator.~~		530
	~~In cases where neither the claim nor any counterclaim~~		531
	~~exceeds the sum of USD50,000 (or such other sum as the~~		532
	~~parties may agree) the arbitration shall be conducted in~~		533
	~~accordance with the LMAA Small Claims Procedure current~~		534
	~~at the time when the arbitration proceedings are commenced.~~		535
	~~19.2~~	~~This Agreement shall be governed by and construed~~	536
	~~in accordance with Title 9 of the United States Code and~~		537
	~~the Maritime Law of the United States and any dispute~~		538
	~~arising out of or in connection with this Agreement shall be~~		539
	~~referred to three persons at New York, one to be appointed~~		540
	~~by each of the parties hereto, and the third by the two so~~		541
	~~chosen; their decision or that of any two of them shall be~~		542
	~~final, and for the purposes of enforcing any award,~~		543
	~~judgement may be entered on an award by any court of~~		544
	~~competent jurisdiction. The proceedings shall be conducted~~		545
	~~in accordance with the rules of the Society of Maritime~~		546
	~~Arbitrators, Inc.~~		547
	~~In cases where neither the claim nor any counterclaim~~		548
	~~exceeds the sum of USD50,000 (or such other sum as the~~		549
	~~parties may agree) the arbitration shall be conducted in~~		550
	~~accordance with the Shortened Arbitration Procedure of the~~		551
	~~Society of Maritime Arbitrators, Inc. current at the time when~~		552
	~~the arbitration proceedings are commenced.~~		553
	~~19.3~~	~~This Agreement shall be governed by and construed~~	554
	~~in accordance with the laws of the place mutually agreed by~~		555
	~~the parties and any dispute arising out of or in connection~~		556
	~~with this Agreement shall be referred to arbitration at a~~		557
	~~mutually agreed place, subject to the procedures applicable~~		558
	~~there.~~		559
	19.4	If Box 18 in Part I is not appropriately filled in, sub-	560
	clause 19.1 of this Clause shall apply.		561

	Note: 19.1, 19.2 and 19.3 are alternatives; indicate		562
	alternative agreed in Box 18.		563

20.	Notices		564
	20.1	Any notice to be given by either party to the other	565
	party shall be in writing and may be sent by fax, ~~telex,~~		566
	registered or recorded mail or by personal service.		567
	20.2	The address of the Parties for service of such	568
	communication shall be as stated in Boxes 19 and 20,		569
	respectively.		570

A-A-11

APPENDIX II

FORM OF SUPERVISION AGREEMENT

THIS AGREEMENT is made the _____ day of [ ], 20[ ] BETWEEN:


(1)	[name of relevant member of the Group], a company incorporated under the laws of [ ], whose registered office is [ADDRESS] (the “Owner”); and

(2)	COSTAMARE SHIPPING COMPANY S.A., a company incorporated under the laws of [ ], whose registered office is at [ADDRESS] (the “Construction Supervisor”).

WHEREAS:

By a shipbuilding contract dated (the “Shipbuilding Contract”) and made between [ ] (the “Builder”) and the Owner, the Builder agreed to construct, to the order of the Owner, and sell to the Owner, a [ ] container vessel, known during construction as Hull No.[ ] (the “Vessel”);

IT IS NOW AGREED as follows:

ARTICLE I

DEFINITIONS

SECTION 1.1. Except as otherwise defined herein, all terms defined in the Shipbuilding Contract shall have the same respective meanings when used herein.

SECTION 1.2. In this Agreement, unless the context otherwise requires, the following expressions shall have the following meanings:

“Business Day” means a day, other than a Saturday or Sunday or a public holiday, on which major retail banks in New York City and Athens Greece, and (in respect of any payments which are to be made to the Builder) [ ], are open for non-automated customer services;

“Group Management Agreement” means the agreement dated [ ] 2010 made between the Parent and the Construction Supervisor.

“Owner’s Supplies” means all of the items to be furnished to the Vessel by the Owner in accordance the relevant provisions of the Shipbuilding Contract.

“Parent” means Costamare Inc. of Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, ▇▇▇▇▇▇▇▇ Islands MH96960 and includes its successors in title.

A-II-1

“Spares” means the items to be designated as spares by the parties hereto at the time of the delivery of the Vessel.

“Supervision Period” means the period from the execution of this Agreement to and including the earlier of (i) the date of delivery of the Vessel pursuant to the Shipbuilding Contract and (ii) the date this Agreement is terminated.

ARTICLE II

APPOINTMENT

SECTION 2.1. The Owner hereby appoints the Construction Supervisor, and the Construction Supervisor hereby agrees to act as the Owner’s supervisor towards the Builder and as the “Owner’s Representative” under the Shipbuilding Contract for the duration of the Supervision Period and to perform the duties and rights which rest with the Owner regarding the construction and delivery of the Vessel in accordance with all of the provisions of the Shipbuilding Contract. The Owner shall be responsible for, inter alia, determining the general policy of supervision of construction of the Vessel and the scope of activities of the Construction Supervisor and, in the performance of its duties under this Agreement, the Construction Supervisor shall at all times act strictly in accordance with any instructions or directions given to it by the Owner regarding such general policy or, in the absence of such instructions or directions, in accordance with the standards of a prudent supervisor providing services of the type to be provided under this Agreement, having due regard to the Owner’s interest. Any instructions so given shall be consistent with the nature and scope of the supervision services required to be performed by the Construction Supervisor under this Agreement and shall not require the Construction Supervisor to do or omit to do anything which may be contrary to any applicable law of any jurisdiction or which is inconsistent or contrary to any of the rights and duties of the Owner under the Shipbuilding Contract. Upon appointment the Owner shall furnish the Construction Supervisor with a full and complete copy of the Shipbuilding Contract (which for the avoidance of doubt shall include the Specifications and the Plans).

SECTION 2.2. Specific Powers and Duties of the Construction Supervisor. Without prejudice to the generality of the appointment made under Section 2.1, and (where applicable) by way of addition to the rights, powers and duties so conferred, the Construction Supervisor shall, subject to this Section 2.2 and to Articles III and IV, have and be entrusted with the following rights, powers and duties in relation to the Shipbuilding Contract and the Vessel:


	(a) to review, comment on, agree and approve the lists of plans and the drawings referred to; to attend the testing of the Vessel’s machinery, outfitting and equipment and to request any tests or inspections which the Construction Supervisor may consider appropriate or desirable and to review and comment on the results of all tests and inspections to the extent this is possible under the terms of the Shipbuilding Contract; to carry out such inspections and give such advice or suggestions to the Builder as the Construction Supervisor may consider

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	appropriate and as the terms of the Shipbuilding Contract allow him to do; and to give notice to the Builder in the event that the Construction Supervisor discovers any construction, material or workmanship which the Construction Supervisor believes does not or will not conform to the requirements of the Shipbuilding Contract and the specifications again provided the terms of the Shipbuilding Contract allows for such notice to be given;

	(b) to appoint a representative of the Construction Supervisor for the purposes specified under Article [ ];

	(c) if any alteration or addition to the Shipbuilding Contract becomes obligatory or desirable, to consult with the Builder and make recommendations to the Owner as to whether or not acceptance should be given to any proposal notified to the Owner by the Builder;

	(d) to request and agree to any minor alterations, additions or modifications to the Vessel or the specifications and any substitute materials to the extent this is possible under the terms of the Shipbuilding Contract, which the Construction Supervisor may consider appropriate or desirable, provided that if the cost of such variations or substitute materials would have the effect of altering the Contract Price (as defined in the Shipbuilding Contract) by more than three per cent (3%) from the Contract Price on the date hereof or the amount of any of the installments of the Contract Price due under the Shipbuilding Contract prior to the delivery of the Vessel, the Construction Supervisor shall notify the same to the Owner in writing and obtain the Owner’s instructions before taking any action in relation thereto; to receive from and transmit to the Builder information relating to the requirements of the classification society and to give instructions and agree with the Builder regarding alterations, additions or changes in connection with such requirements; and to approve the substitution of materials as requested by the Builder;

	(e) to attend and witness the trials of the Vessel to the extent this is possible under the terms of the Shipbuilding Contract;

	(f) to determine whether the Vessel has been designed, constructed, equipped and completed in accordance with, and complies with, the Shipbuilding Contract and the Specifications and Plans (each as defined in the Shipbuilding Contract); to give the Builder a notice of acceptance or (as the case may be) rejection of the Vessel, to require or request any further test and inspection of the Vessel to the extent this is possible under the terms of the Shipbuilding Contract, and to give and receive any further or other notice relative to such matters and generally to advise the Owner in respect of all such matters;

	(g) to sign on behalf of the Owner any protocols as to sea trials, consumable stores, delivery and acceptance or otherwise, having first ascertained with the Owner the appropriateness of so doing;

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	(h) to accept on behalf of the Owner the documents specified in Article [ ], Paragraph [ ] of the Shipbuilding Contract to be delivered by the Builder at delivery of the Vessel under the Shipbuilding Contract and to confirm receipt thereof to the Owner;

	(i) to give and receive on behalf of the Owner any notice contemplated by the Shipbuilding Contract, provided that the Construction Supervisor shall not have authority to give on behalf of the Owner any notice which the Owner may be entitled to give to cancel, repudiate or rescind the Shipbuilding Contract without the prior written consent of the Owner; and

	(j) to purchase, after being placed in funds by the Owner, all Owner’s Supplies as agent of the Owner and supply and deliver the same together with all necessary specifications, plans, drawings, instruction books, manuals, test reports and certificates to the Builder as provided in the Shipbuilding Contract, and provide to the Owner a list of all such Owner’s Supplies as soon as possible.

SECTION 2.3. The Construction Supervisor shall discharge its responsibilities under this Clause 2 as the Owner’s agent.

SECTION 2.4. In the event that the Construction Supervisor uses own funds to purchase Owner’s Supplies, the cost of supplying and delivering Owner’s Supplies pursuant to relevant terms of the Shipbuilding Contract shall be reimbursed by the Owner to the Construction Supervisor on the date the Construction Supervisor submits to the Owner supporting invoices in respect of such cost.

ARTICLE III

CONSTRUCTION SUPERVISOR’S DUTIES
REGARDING CONSTRUCTION

SECTION 3.1. The Construction Supervisor undertakes with the Owner with respect to the Shipbuilding Contract:


	(a) to notify the Owner in writing promptly on becoming aware of any likely change to any of the dates on which any installment under the Shipbuilding Contract is expected to be due;

	(b) to (i) notify the Owner in writing of the expected date on which the launching or, as the case may be, sea trials of the Vessel is or are to take place and (ii) promptly on the same day as the launching or, as the case may be, sea trials of the Vessel takes or take place to confirm that the launching or, as the case may be, sea trials of the Vessel has or have taken place and, where relevant, that the amount specified in such confirmation is due and payable;

	(c) to (i) advise the Owner in writing, four (4) Business Days prior to the date on which the delivery installment under the Shipbuilding Contract is anticipated to become due, of the times and amounts of payments to be made to

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	the Builder under the Shipbuilding Contract and any amount due to the Construction Supervisor for Owner’s Supplies not already settled and (ii) promptly confirm the same on the day on which such installment becomes due (and being the date the same is required to be paid to the account referred to in the relevant term of the Shipbuilding Contract);

	(d) not to accept the Vessel or delivery of the Vessel on the Owner’s behalf without the Owner’s prior written approval and unless the Construction Supervisor shall have previously certified to the Owner in writing, in the form of the certificate set out in Schedule 1 to this Agreement, that:

	(i) the Vessel has been duly completed and is ready for delivery to and acceptance by the Owner in or substantially in accordance with the Shipbuilding Contract and the Specifications and Plans;

	(ii) there is, to the best of the Construction Supervisor’s knowledge and belief having made due enquiry with the Builder, no lien or encumbrance on the Vessel other than the lien in favor of the Builder in respect of the delivery installment of the Contract Price due in accordance with the terms of the Shipbuilding Contract; and

	(iii) the Vessel is recommended for classification by the relevant classification society provided for in the Shipbuilding Contract (and the Construction Supervisor shall attach to its certificate the provisional certificate of such classification society recommending such classification of the Vessel or a duplicate or photocopy of such provisional certificate or otherwise provide evidence of such classification to the Owner);

	(e) on receipt thereof from the Builder promptly to deliver the documents specified in Article [ ], Paragraph [ ] of the Shipbuilding Contract to the Owner or as the Owner may direct; and

	(f) solely with the prior written approval of the Owner, to request from or agree with the Builder any material alterations, additions or modifications to the Vessel.

ARTICLE IV

CONSTRUCTION SUPERVISOR’S GENERAL OBLIGATIONS

SECTION 4.1. The Construction Supervisor undertakes to the Owner, with respect to the exercise and performance of its rights, powers and duties as the Owner’s representative under this Agreement, as follows:

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	(a) it will exercise commercially reasonable efforts to cause the due and punctual observance and performance of all conditions, duties and obligations imposed on the Owner by the Shipbuilding Contract (other than to pay the Contract Price) and will not without the prior written consent of the Owner:

	(i) exercise any rights of the Owner to cancel, repudiate or rescind the Shipbuilding Contract;

	(ii) waive, modify or suspend any provision of the Shipbuilding Contract if as a result of such waiver, modification or suspension the Owner will or may suffer any adverse consequences; and

	(b) it will, at its own expense, keep all necessary and proper books, accounts, records and correspondence files relating to its duties and activities under this Agreement and shall send quarterly reports to the Owner concerning the progress of the design and construction of the Vessel and keep the Owner promptly informed of any deviations from the building program.

ARTICLE V

LIABILITY AND INDEMNITY

SECTION 5.1. Save for the obligation of the Owner to pay any moneys due to the Construction Supervisor hereunder, neither the Owner nor the Construction Supervisor shall be under any liability to the other for any failure to perform any of their obligations hereunder by reason of Force Majeure. “Force Majeure” shall mean any cause whatsoever of any nature or kind beyond the reasonable control of the Owner or the Construction Supervisor, including, without limitation, acts of God, acts of civil or military authorities, acts of war or public enemy, acts of any court, regulatory agency or administrative body having jurisdiction, insurrections, riots, strikes or other labor disturbances, embargoes or other causes of a similar nature.

SECTION 5.2. The Construction Supervisor, including its officers, directors, employees, shareholders, agents and any sub-contractors (the “Construction Supervisor Related Parties”), shall be under no liability whatsoever to the Owner or to any third party (including the Builder) for any loss, damage, delay or expense of whatsoever nature, whether direct or indirect (including but not limited to loss of profit arising out of or in connection with the delayed or non-conforming delivery of the Vessel), and howsoever arising in the course of the performance of this Agreement, unless and to the extent that the same is proved to have resulted solely from the gross negligence or willful misconduct of the Construction Supervisor, its officers, employees, agents or any of its sub-contractors in which case (save where loss, damage, delay or expense, has resulted from the Construction Supervisor’s personal act or omission committed with the intent to cause same) the Construction Supervisor’s liability for each incident or series of incidents giving rise to claim or claims shall never exceed a total of ten times the fees payable hereunder.

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SECTION 5.3. The Owner shall indemnify and hold harmless the Construction Supervisor Related Parties against all actions, proceedings, claims, demands or liabilities whatsoever or howsoever arising which may be brought against them or incurred or suffered by them arising out of or in connection with the performance of this Agreement and against and in respect of any loss, damage, delay or expense of whatsoever nature (including legal costs and expenses on a full indemnity basis), whether direct or indirect, incurred or suffered by any Construction Supervisor Related Party in the performance of this Agreement, unless incurred or suffered due to the gross negligence or willful misconduct of any Construction Supervisor Related Party.

SECTION 5.4. It is hereby expressly agreed that no employee or agent of the Construction Supervisor (including any sub-contractor from time to time employed by the Construction Supervisor) shall in any circumstances whatsoever be under any liability whatsoever to the Owner or any third party for any loss, damage or delay of whatsoever kind arising or resulting directly or indirectly from any act, neglect or default on his part while acting in the course of or in connection with his employment and, without prejudice to the generality of the foregoing provisions in this Article V, every exemption, limitation, condition and liberty herein contained and every right, exemption from liability, defense and immunity of whatsoever nature applicable to the Construction Supervisor or to which the Construction Supervisor is entitled hereunder shall also be available and shall extend to protect every such employee or agent of the Construction Supervisor acting as aforesaid, and for the purpose of all the foregoing provisions of this Article V, the Construction Supervisor is or shall be deemed to be acting as agent or trustee on behalf of and for the benefit of all persons who are or might be their servants or agents from time to time (including sub-contractors as aforesaid) and all such persons shall to this extent be or be deemed to be parties to this Agreement.

SECTION 5.5. The provisions of this Article V shall survive any termination of this Agreement.

ARTICLE VI

FEES

SECTION 6.1. In consideration of the performance of the duties assigned to the Construction Supervisor in this Agreement, the Owner shall pay to the Construction Supervisor the sum of US$700,000 for its total supervision costs in connection with the supervision of the construction of the Vessel, plus any expenses incurred under the Shipbuilding Contract against presentation of supporting invoices from the Construction Supervisor which the Construction Supervisor shall supply to the Owner at the same time as payment is requested. The fee payable hereunder to the Construction Supervisor shall include all costs which are incurred by the Construction Supervisor in connection with the ordinary exercise and performance by the Construction Supervisor of the rights, powers and duties entrusted to it pursuant to this Agreement. The supervision fee will be paid in two equal installments as follows:


	(a) US$350,000 on execution of this Agreement; and

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	(b) US$350,000 upon the Construction Supervisor advising the Owner of the completion of the sea trial run of the Vessel.

For the avoidance of doubt, the Construction Supervisor can demand payment of the fee and other amounts payable hereunder from the Parent pursuant to the relevant provisions of the Group Management Agreement.

ARTICLE VII

COMMENCEMENT - TERMINATION

SECTION 7.1. This Agreement shall come into effect on the date hereof and shall continue until the delivery of the Vessel in accordance with the Shipbuilding Contract unless terminated earlier pursuant to the terms of Section 7.2, Section 7.3, Section 7.4 or Section 7.5 hereof.

SECTION 7.2. The Owner shall be entitled to terminate this Agreement by notice in writing to the Construction Supervisor if the Construction Supervisor defaults in the performance of any material obligation under this Agreement, subject to a cure right of 20 Business Days following written notice by the Owner.

               SECTION 7.3. This Agreement shall terminate automatically if:

               (a) the Shipbuilding Contract is cancelled, rescinded or terminated; or

               (b) the Group Management Agreement is terminated.

SECTION 7.4. The Construction Supervisor shall be entitled to terminate this Agreement by notice in writing to the Owner if:


	(a) any moneys payable by the Owner under this Agreement is not paid when due or if due on demand within 10 Business Days following demand by the Construction Supervisor; or

	(b) the Owner defaults in the performance of any other material obligations under this Agreement, subject to a cure right of 20 Business Days following written notice by the Construction Supervisor; or

SECTION 7.5. Either party shall be entitled to terminate this Agreement immediately if:

	(a) the other party ceases to conduct business, or all or substantially all of the equity-interests, properties or assets of either such party is sold, seized or appropriated; or

	(b) (i) the other party files a petition under any bankruptcy law, makes an assignment for the benefit of its creditors, seeks relief under any law for the protection of debtors or adopts a plan of liquidation; (ii) a petition is filed against

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	the other party seeking to have it declared insolvent or bankrupt and such petition is not dismissed or stayed within 40 Business Days of its filing; (iii) the other party shall admit in writing its insolvency or its inability to pay its debts as they mature; (iv) an order is made for the appointment of a liquidator, manager, receiver or trustee of the other party of all or a substantial part of its assets; (v) or if an encumbrancer takes possession of or a receiver or trustee is appointed over the whole or any part of the other party’s undertaking, property or assets; or (vi) if an order is made or a resolution is passed for the other party’s winding up; or

	(c) a distress, execution, sequestration or other process is levied or enforced upon or sued out against the other party’s property which is not discharged within 20 Business Days; or

	(d) the other party ceases or threatens to cease wholly or substantially to carry on its business otherwise than for the purpose of a reconstruction or amalgamation without insolvency previously approved by the terminating party; or

	(e) the other party is prevented from performing its obligations hereunder by reasons of Force Majeure for a period of two or more consecutive months.

SECTION 7.6. In the event of termination due to the Construction Supervisor’s default, then it shall not be entitled to receive any payment in respect of the fees and other amounts described in Article VI becoming due and payable after the date of such termination.

ARTICLE VIII
EMPLOYEES

SECTION 8.1. None of the employees and/or sub-contractors of the Construction Supervisor shall constitute, for the purposes of this Agreement, sub-agents of the Owner. The Construction Supervisor, in its capacity as employer and contractor (and not in its capacity as agent for the Owner), shall (a) be responsible for the salaries, expenses and costs in respect of each of its employees and sub-contractors (not in its capacity as agent for the Owner) and (b) save for the provisions of Article V hereof, indemnify its employees and sub-contractors for any liabilities and losses incurred by such employees and sub-contractors.

ARTICLE IX

GOVERNING LAW - ARBITRATION

SECTION 9.1. This Agreement shall be governed by and be construed in accordance with the laws of England.

SECTION 9.2. All disputes arising out of this Agreement shall be arbitrated in London in the following manner. One arbitrator is to be appointed by each of the parties hereto and a third by the two so chosen. Their decision or that of any two

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of them shall be final and, for the purpose of enforcing any award, this Agreement may be made a rule of the court. The arbitrators shall be commercial persons, conversant with shipping matters. Such arbitration is to be conducted in accordance with the rules of the London Maritime Arbitration Association terms current at the time when the arbitration proceedings are commenced and in accordance with the Arbitration Act 1996 or any statutory modification or re-enactment thereof.

SECTION 9.3. In the event that the a party hereto shall state a dispute and designate an arbitrator in writing, the other party shall have 20 Business Days to designate its own arbitrator. If such other party fails to designate its own arbitrator within such period, the arbitrator appointed by the first party can render an award hereunder.

SECTION 9.4. Until such time as the arbitrators finally close the hearings, either party shall have the right by written notice served on the arbitrators and on the other party to specify further disputes or differences under this Agreement for hearing and determination.

SECTION 9.5. The arbitrators may grant any relief, and render an award, which they or a majority of them deem just and equitable and within the scope of this Agreement, including but not limited to the posting of security. Awards pursuant to this Article IX may include costs, including a reasonable allowance for attorneys’ fees, and judgments may be entered upon any award made herein in any court having jurisdiction.

ARTICLE X

COUNTERPARTS

SECTION 10.1. This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument.

ARTICLE XI

NOTICES

SECTION 11.1. Every notice or other communication under this Agreement shall:


	(a) be in writing delivered personally or by first-class prepaid letter (airmail if available) or facsimile transmission or other means of telecommunication (other than telex) in permanent written form;

	(b) be deemed to have been received, in the case of a letter, when delivered personally or three (3) days after it has been put into the post and, in the case of a facsimile transmission or other means of telecommunication (other than telex) in permanent written form, at the time of dispatch (provided that if the date of dispatch is a Saturday or Sunday or a public holiday in the country of the addressee or if the time of dispatch is after the close of business in the country of

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the addressee it shall be deemed to have been received at the opening of business on the next day which is not a Saturday or Sunday or public holiday); and


	(c) be sent:

	(i) to the Construction Supervisor at:

		COSTAMARE SHIPPING COMPANY S.A. ▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ Telephone No.: ▇▇▇ ▇▇▇-▇▇▇-▇▇▇▇ Fax No.: ▇▇▇ ▇▇▇-▇▇▇-▇▇▇▇

	(ii) to the Owner at:

		COSTAMARE INC. ▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ Telephone No.: ▇▇▇ ▇▇▇-▇▇▇-▇▇▇▇ Fax No.: ▇▇▇ ▇▇▇-▇▇▇-▇▇▇▇ Attention: Chief Executive Officer

or to such other address and/or numbers for a party as is notified by such party to the other party under this Agreement.

SECTION 11.2. Each communication and document made or delivered by one party to another pursuant to this Agreement shall be in the English language.

SECTION 11.3. This Agreement shall not create benefits on behalf of any other person not a party to this Agreement, and this Agreement shall be effective only as between the parties hereto, their successors and permitted assigns.

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IN WITNESS of which this Agreement has been duly executed the day and year first before written.

For the Owner

For the Construction Supervisor

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SCHEDULE 1

FORM OF CONSTRUCTION CERTIFICATE

[On the letterhead of the Construction Supervisor]

[Vessel Owner] (the “Owner”)
[Address]
Facsimile: [ ]
Attention: [ ]

Date: _________________

Dear Sirs,

[Name of Builder] (the “Builder”), [Name of Vessel] (the “Vessel”)

We refer to the construction supervision agreement dated [ ] between the Owner and us (the “Supervision Agreement”).

Words and expressions defined in the Supervision Agreement (whether expressly or by incorporation by reference to another document) shall have the same meaning where used in this certificate.

We hereby certify, pursuant to Section 3.1(d) of the Supervision Agreement, as follows:


(i)	the Vessel has been duly completed and is ready for delivery to and acceptance by the Owner in or substantially in accordance with the Shipbuilding Contract and the Specifications and Plans; and

(ii)	the Vessel is recommended for classification by [Name of the classification society] (the “Classification Society”).

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With respect to paragraph (ii) above, please find attached to this certificate the provisional certificate of the Classification Society recommending such classification of the Vessel / a duplicate or photocopy of the provisional certificate of the Classification Society recommending such classification of the Vessel / the following evidence of the Classification Society’s recommendation of such classification of the Vessel [ ].


	Yours faithfully,


	for and on behalf of
	COSTAMARE SHIPPING COMPANY S.A.

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COSTAMARE INC. - and - COSTAMARE SHIPPING COMPANY S.A. MANAGEMENT AGREEMENT

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