Common use of Collateral Maintenance Clause in Contracts

Collateral Maintenance. The Borrower will not permit the aggregate Appraised Value of all Mortgaged Vessels owned by the Borrower and the Subsidiary Guarantors which have not been sold, transferred, lost or otherwise disposed of (it being understood that Permitted Chartering Arrangements do not constitute disposals for this purpose) (such value, the “Aggregate Mortgaged Vessel Value”), as determined by the most recent appraisals delivered by the Borrower to the Administrative Agent or obtained by the Administrative Agent in accordance with Section 5.12 or Section 8.01(c) to be (x) prior to January 1, 2011, less than [*] and (y) from and after January 1, 2011, less than [*] of the sum of (a) the then outstanding principal amount of Other First Lien Obligations (including the Senior Secured Notes) plus (b) the Total Commitment at such time; provided that, so long as any non-compliance in respect of this Section 9.08 is not caused by any voluntary Collateral Disposition, such non-compliance shall not constitute a Default or an Event of Default so long as within 10 Business Days of the occurrence of such default, the Borrower shall either (i) post additional collateral reasonably satisfactory to the Required Lenders in favor of the Collateral Agent (it being understood that cash collateral comprised of Dollars is satisfactory and that it shall be valued at par), pursuant to security documentation reasonably satisfactory in form and substance to the Collateral Agent, in an aggregate amount sufficient to cure such non-compliance (and shall at all times during such period and prior to satisfactory completion thereof, be diligently carrying out such actions) or (ii) make such reductions of the Total Commitment in an amount sufficient to cure such non-compliance and repay the Loans and/or cash collateralize the Letters of Credit to the extent required by Section 4.02(a).

Collateral Maintenance. The Borrower Parent will not permit the aggregate Appraised Value sum of the fair market value of all Mortgaged Vessels owned by the Borrower and the Subsidiary Guarantors Collateral Rigs which have not been sold, transferred, lost or otherwise disposed of (it being understood that Permitted Chartering Arrangements do not constitute disposals for this purpose) of, on an individual charter-free basis, at any time (such value, the “Aggregate Mortgaged Vessel Collateral Rig Value”), as determined by calculating the appraised value set forth in the most recent appraisals appraisal report related to each respective Collateral Rig and delivered by the Borrower to the Administrative Agent or obtained by the Administrative Agent in accordance with Section 5.12 or Section 8.01(c) 9.01(c), to be (x) prior to January 1, 2011, equal less than [*] and (y) from and after January 1, 2011, less than [*] 150% of the sum of (a) the then aggregate outstanding principal amount of Other First Lien Obligations (including the Senior Secured Notes) plus (b) the Total Commitment Loans and Letters of Credit Outstanding at such time; provided that, (x) for the avoidance of doubt, it is understood and agreed that the appraisal reports delivered on January 15, 2014 from Fearnleys Ltd. and on January 20, 2014 from Pareto Offshore AS shall be satisfactory for the purpose of making the calculation in this Section 10.9 from the Amendment and Restatement Effective Date until the next required date of delivery of appraisal reports under this Agreement; (y) so long as any non-compliance in respect violation of this Section 9.08 10.09 is not caused by any voluntary Collateral Disposition, such non-compliance violation shall not constitute a Default or an Event of Default so long as within 10 Business Days 60 days of the occurrence of such defaultviolation, the Borrower shall either (i) post additional collateral reasonably (at the expense of the Borrower) satisfactory to the Required Lenders in favor of the Collateral Agent (it being understood that cash collateral comprised of Dollars is satisfactory and that it shall be valued at par)Lenders, pursuant to security documentation reasonably the Collateral and Guaranty Requirements and otherwise satisfactory in form and substance to the Collateral Agent, in an aggregate amount sufficient to cure such non-compliance violation (and shall at all times during such period and prior to satisfactory completion thereof, be diligently carrying out such actions) or (ii) make such reductions of the Total Commitment repay outstanding Loans in an amount sufficient to cure such non-compliance and repay the Loans and/or cash collateralize the Letters violation (it being understood that any action taken in respect of Credit this proviso shall only be effective to cure such violation pursuant to this Section 10.09 to the extent required by Section 4.02(a)that no Default or Event of Default exists hereunder immediately after giving effect thereto) and (z) the value of any Collateral Rig shall not be included in the Aggregate Collateral Rig Value until such time as such Collateral Rig has been delivered to the Borrower or a Wholly-Owned Subsidiary of the Borrower and the Collateral and Guaranty Requirements have been fully satisfied with respect thereto.

Collateral Maintenance. (a) The Borrower Parent will not permit the aggregate Appraised Fair Market Value of all Mortgaged Collateral Vessels owned by the Borrower and the Subsidiary Guarantors Credit Parties which have not been sold, transferred, lost or otherwise disposed of (it being understood that Permitted Chartering Arrangements do not constitute disposals for this purpose) at any time (such value, the “Aggregate Mortgaged Collateral Vessel Value”), as determined by the most recent appraisals appraisal delivered by the Borrower to the Administrative Agent or obtained by the Administrative Agent in accordance with Section 5.12 or Section 8.01(c8.01(d), at any time to equal less than (I) from the Third Amendment to be and including June 30, 2015, 110% of an amount equal to (x) prior to January 1, 2011, less than [*] and the amount of the Aggregate Credit Agreement Exposure at such time minus (y) from and after January 1, 2011, less than [*] of the sum of the 508 Blocked Amount and the 273 Blocked Amount at such time, (aII) from July 1, 2015 to and including December 31, 2016, 115% of an amount equal to (x) the then outstanding principal amount of Other First Lien Obligations the Aggregate Credit Agreement Exposure at such time minus (including the Senior Secured Notes) plus (by) the Total Commitment sum of the 508 Blocked Amount and the 273 Blocked Amount at such time and (III) thereafter, 120% of an amount equal to (x) the Aggregate Credit Agreement Exposure at such time minus (y) the sum of the 508 Blocked Amount and the 273 Blocked Amount at such time; provided that, so long as any non-compliance default in respect of this Section 9.08 9.09(a) is not caused by any voluntary Collateral Disposition, such non-compliance default shall not constitute a Default or an Event of Default (but shall constitute a Default) so long as within 10 Business Days 45 days of the occurrence of such default, the Borrower shall either (i) post additional collateral reasonably satisfactory to the Required Lenders in favor of the Collateral Agent (it being understood that cash collateral comprised of Dollars is satisfactory and that it shall be valued at par)Lenders, pursuant to security documentation reasonably satisfactory in form and substance to the Collateral Agent, in an aggregate amount sufficient to cure such non-compliance default (and shall at all times during such period and prior to satisfactory completion thereof, be diligently carrying out such actions) (it being understood that (a) the Borrower may, in its sole discretion, decide whether the additional collateral posted to cure such default shall constitute Primary Collateral or Secondary Collateral and (b) cash denominated in US$ Dollars shall always be deemed to constitute collateral satisfactory to the Required Lenders and shall be valued at par) or (ii) make such reductions repayment of Loans under this Agreement and loans under the Total Commitment Other Credit Agreement on a pro rata basis based on the outstanding principal amount of Loans under this Agreement at such time and the outstanding principal amount of loans under the Other Credit Agreement at such time, in each case in an amount sufficient to cure such non-compliance and repay the Loans and/or cash collateralize the Letters default (it being understood that any action taken in respect of Credit this proviso shall only be effective to cure such default pursuant to this Section 9.09(a) to the extent that no Default or Event of Default exists hereunder immediately after giving effect thereto). (b) In order to comply with clauses (I), (II) and (III) of Section 9.09(a) above, the Parent may, at any time, deposit into the 508 Blocked Account and the 273 Blocked Account on a pro rata basis based on the outstanding principal amount of Loans under this Agreement at such time and the outstanding principal amount of loans under the Other Credit Agreement at such time (the amount of Unrestricted Cash and Cash Equivalents so deposited in the 508 Blocked Account being the “508 Blocked Amount”), an amount of Unrestricted Cash and Cash Equivalents held by the Parent and its Subsidiaries at such time such that, after giving effect to such deposit, the Parent would be in compliance with the provisions of Section 9.09(a) at such time; provided that, at such time, the Parent shall have furnished to the Administrative Agent a certificate of the senior financial officer of the Parent setting forth the calculations required to establish the amount of the Unrestricted Cash and Cash Equivalents that are required by the Parent in order to establish compliance with the provisions of this Section 4.02(a)9.09 at the time of such deposit. Amounts on deposit in the 508 Blocked Account may be released from the 508 Blocked Account at such time as the Parent shall have furnished to the Administrative Agent a certificate of the senior financial officer of the Parent setting forth the calculations required to establish compliance with the provisions of this Section 9.09 without the deduction of any such Unrestricted Cash and Cash Equivalents so long as no Default or Event of Default exists at such time or would result under Section 9.09 or otherwise from the withdrawal of from the 508 Blocked Account. The Collateral Agent may apply the amounts on deposit in the 508 Blocked Account in accordance with the Credit Documents at any time if an Event of Default exists at such time.

Collateral Maintenance. The Neither the Parent nor Borrower will not permit the aggregate Appraised Value fair market value of all Mortgaged Vessels owned by the Parent, Borrower and the Subsidiary Guarantors which have not been sold, transferred, lost or otherwise disposed of (it being understood that Permitted Chartering Arrangements do not constitute disposals for this purpose) of, on an individual charter-free basis, at any time (such value, the “Aggregate Mortgaged Vessel Value”), as determined by the most recent appraisals appraisal delivered by either of the Parent or Borrower to the Administrative Agent or obtained by the Administrative Agent in accordance with Section 5.12 or Section 8.01(c) to be (x) prior to January 1, 2011, equal less than [*] and (y) from and after January 1, 2011, less than [*] 110% of the sum of (a) the then outstanding principal amount of Other First Lien Obligations (including the Senior Secured Notes) plus (b) the Total Aggregate Commitment at such time; provided that, so long as any non-compliance default in respect of this Section 9.08 9.09 is not caused by any voluntary Collateral Disposition, such non-compliance default shall not constitute a Default or an Event of Default so long as within 10 Business Days 45 days of the occurrence of such default, the Borrower Parent shall either (i) post additional collateral reasonably satisfactory to the Required Lenders in favor of the Collateral Agent (it being understood that cash collateral comprised of Dollars is satisfactory and that it shall be valued at par)Lenders, pursuant to security documentation reasonably satisfactory in form and substance to the Collateral AgentAgent (such additional collateral and security documentation shall be satisfactory to the Collateral Agent so long as (a) the Obligations are secured thereby, (b) such documentation is satisfactory under the Senior Credit Facilities and (c) such documentation is substantially in an aggregate amount the form of the Security Documents), sufficient to cure such non-compliance default (and shall at all times during such period and prior to satisfactory completion thereof, be diligently carrying out such actions) or (ii) make such reductions of the Total Commitment total commitment under the 2011 Credit Agreement in an amount sufficient to cure such non-compliance default and repay the Loans loans under the 2011 Credit Agreement and/or cash collateralize the Letters 2010 Credit Agreement (it being understood that any action taken in respect of Credit this proviso shall only be effective to cure such default pursuant to this Section 9.09 to the extent required by Section 4.02(athat no Default or Event of Default exists hereunder immediately after giving effect thereto).

Collateral Maintenance. The Borrower Parent will not permit the aggregate Appraised Value sum of the fair market value of all Mortgaged Vessels owned by the Borrower and the Subsidiary Guarantors Collateral Rigs which have not been sold, transferred, lost or otherwise disposed of (it being understood that Permitted Chartering Arrangements do not constitute disposals for this purpose) of, on an individual charter-free basis, at any time (such value, the “Aggregate Mortgaged Vessel Collateral Rig Value”), as determined by calculating the appraised value set forth in the most recent appraisals appraisal report related to each respective Collateral Rig and delivered by the Borrower to the Administrative Agent or obtained by the Administrative Agent in accordance with Section 5.12 or Section 8.01(c) ), to be (x) prior to January 1, 2011, equal less than [*] and (y) from and after January 1, 2011, less than [*] 150% of the sum of (a) the then outstanding aggregate principal amount of Other First Lien Obligations (including the Senior Secured Notes) plus (b) the Total Commitment at such time; provided that, (x) so long as any non-compliance in respect violation of this Section 9.08 9.09 is not caused by any voluntary Collateral Disposition, such non-compliance violation shall not constitute a Default or an Event of Default so long as within 10 Business Days 60 days of the occurrence of such defaultviolation, the Borrower shall either (i) post additional collateral reasonably (at the expense of the Borrower) satisfactory to the Required Lenders in favor of the Collateral Agent (it being understood that cash collateral comprised of Dollars is satisfactory and that it shall be valued at par)Lenders, pursuant to security documentation reasonably referred to in Section 8.11 and otherwise satisfactory in form and substance to the Collateral Agent, in an aggregate amount sufficient to cure such non-compliance violation (and shall at all times during such period and prior to satisfactory completion thereof, be diligently carrying out such actions) or (ii) make such reductions of to the Total Commitment (and any required repayments of outstanding Loans resulting therefrom) in an amount sufficient to cure such non-compliance and repay the Loans and/or cash collateralize the Letters violation (it being understood that any action taken in respect of Credit this proviso shall only be effective to cure such violation pursuant to this Section 9.09 to the extent required by that no Default or Event of Default exists hereunder immediately after giving effect thereto) and (y) the value of any Collateral Rig shall not be included in the Aggregate Collateral Rig Value until such time as such Collateral Rig has been delivered to the Borrower or a Wholly-Owned Subsidiary of the Borrower and the provisions of Section 4.02(a)8.11 have been fully complied with.

Collateral Maintenance. (a) The Borrower will not permit the aggregate Appraised Market Value of all Mortgaged the Vessels owned by to be less than the Borrower and Required Amount, such test to be determined no more than semi annually as provided in Clause 17.6 (c) below, provided that in the Subsidiary Guarantors which have not been soldevent the Facility Agent, transferred, lost or otherwise disposed of (it being understood that Permitted Chartering Arrangements do not constitute disposals for this purpose) (such value, the “Aggregate Mortgaged Vessel Value”), as determined by the most recent appraisals delivered by the Borrower to the Administrative Agent or obtained by the Administrative Agent acting in accordance with Section 5.12 or Section 8.01(c) to Clause 19.2(d), requests additional valuations, such test shall be (x) prior to January 1, 2011, less determined no more than [*] and (y) from and after January 1, 2011, less than [*] of the sum of (a) the then outstanding principal amount of Other First Lien Obligations (including the Senior Secured Notes) plus quarterly. (b) In the Total Commitment at such time; provided that, so long as any non-compliance event that the Borrower fails to meet the ratio set out in respect of this Section 9.08 is not caused by any voluntary Collateral Disposition, such non-compliance shall not constitute a Default or an Event of Default so long as within 10 Business Days of the occurrence of such defaultClause 17.6, the Borrower shall shall, within thirty (30) days of notice being given by the Facility Agent so to do, either (i) post additional collateral reasonably satisfactory prepay such amount of the Loans relating to the Required Lenders in favor delivered Vessels as will ensure that the aggregate of the Collateral Agent (it being understood that cash collateral comprised Market Value of Dollars the delivered Vessels is satisfactory and that it shall be valued at par), pursuant to security documentation reasonably satisfactory not less than the Required Amount in form and substance to respect of the Collateral Agent, in an aggregate amount sufficient to cure such non-compliance (and shall at all times during such period and prior to satisfactory completion thereof, be diligently carrying out such actions) delivered Vessels; or (ii) make provide or cause to be provided to the Security Trustee additional collateral, such reductions collateral to be in all respects satisfactory to the Facility Agent (acting on the instructions of all Lenders), such that the Required Amount is again met provided that, for the avoidance of doubt, such additional security will be required to have such value (as the Facility Agent then determines to be appropriate) such that the Required Amount is again met. (c) Except as provided in the proviso to Clause 17.6(a) when the collateral maintenance test may be effected on no more than a quarterly basis, the Facility Agent shall be entitled to effect such collateral maintenance test on a semiannual basis (commencing six (6) months from the date of this Agreement) and shall base its calculations on the average of the then most recent Valuations provided by two (2) of the Approved Valuers in accordance with Clause 19. (d) If any Vessel becomes a Total Commitment Loss, it shall, as of the earlier of (i) the date of receipt by the Facility Agent of the proceeds of insurance relating to such Total Loss and (ii) the date falling one hundred and eighty (180) days after the occurrence of the relevant event of Total Loss, cease to be a Vessel for the purposes of this Clause 17.6 unless the underwriters agree to settle any insurance claim in respect or such Vessel for an amount sufficient not less than the Market Value of such Vessel within one hundred and eighty (180) days from the occurrence of the event giving rise to cure such non-compliance and repay Total Loss, PROVIDED that, if any insurance proceeds or Requisition Compensation are received by either the Loans and/or cash collateralize Security Trustee or the Letters Facility Agent in respect of Credit to the extent required by Section 4.02(aa Total Loss of such Vessel they shall be applied in accordance with Clause 6.2(b). (e) If at any time any Vessel is not insured in accordance with the terms of the relevant mortgage and the relevant assignment (and in the case of the Vessel, in accordance with the terms of the Mortgage and of the General Assignment) then, for so long as such Vessel is not insured in accordance with such requirements, such Vessel shall, if the Facility Agent so determines, cease to be deemed a Vessel for the purposes of this Clause 17.6. Clauses 6.8 and 6.9 shall apply, mutatis mutandis, to any prepayment made pursuant to this Clause 17.6(b). Any prepayment made in accordance with this Clause shall be applied pro rata across all of the Loans.

Collateral Maintenance. The Neither the Parent nor Borrower will not permit the aggregate Appraised Fair Market Value of all Mortgaged Vessels owned by the Parent, Borrower and the Subsidiary Guarantors which have not been sold, transferred, lost or otherwise disposed of (it being understood that Permitted Chartering Arrangements do not constitute disposals for this purpose) of, on an individual charter-free basis, at any time (such value, the “Aggregate Mortgaged Vessel Value”), as determined by the most recent appraisals appraisal delivered by either of the Parent or Borrower to the Administrative Agent or obtained by the Administrative Agent in accordance with Section 5.12 or Section 8.01(c) to be (x) prior to January 1, 2011, equal less than [*] and (y) from and after January 1, 2011, less than [*] 110% of the sum of (a) the then outstanding principal amount of Other First Lien Obligations (including the Senior Secured Notes) plus (b) the Total Aggregate Commitment at such time; provided that, so long as any non-compliance default in respect of this Section 9.08 9.09 is not caused by any voluntary Collateral Disposition, such non-compliance default shall not constitute a Default or an Event of Default (but shall constitute a Default) so long as within 10 Business Days 45 days of the occurrence of such default, the Borrower Parent shall either (i) post additional collateral reasonably satisfactory to the Required Lenders in favor of the Collateral Agent (it being understood that cash collateral comprised of Dollars is satisfactory and that it shall be valued at par)Lenders, pursuant to security documentation reasonably satisfactory in form and substance to the Collateral AgentAgent and the Required Lenders (such additional collateral and security documentation shall be satisfactory to the Collateral Agent so long as (a) the Obligations are secured thereby, (b) such documentation is satisfactory under the Senior Credit Facilities and (c) such documentation is substantially in an aggregate amount the form of the Security Documents), sufficient to cure such non-compliance default (and shall at all times during such period and prior to satisfactory completion thereof, be diligently carrying out such actions) or (ii) make such reductions of the Total Commitment total commitment under the 2008 Credit Agreement in an amount sufficient to cure such non-compliance default and repay the Loans loans under the 2008 Credit Agreement and/or cash collateralize the Letters 2010 Credit Agreement (it being understood that any action taken in respect of Credit this proviso shall only be effective to cure such default pursuant to this Section 9.09 to the extent required by Section 4.02(athat no Default or Event of Default exists hereunder immediately after giving effect thereto).

Collateral Maintenance. The Borrower Commencing with the fiscal quarter ending March 31, 2011, the Parent will not permit the aggregate Appraised Fair Market Value of all Mortgaged Primary Collateral Vessels owned by the Borrower and the Subsidiary Guarantors Credit Parties which have not been sold, transferred, lost or otherwise disposed of (it being understood that Permitted Chartering Arrangements do not constitute disposals for this purpose) at any time (such value, the “Aggregate Mortgaged Primary Collateral Vessel Value”), as determined by the most recent appraisals appraisal delivered by the Borrower to the Administrative Agent or obtained by the Administrative Agent in accordance with Section 5.12 or Section 8.01(c) to be (x) prior to January 1, 2011, equal less than [*] and (y) from and after January 1, 2011, less than [*] 135% of the sum of (ax) the then outstanding aggregate principal amount of Other First Lien Obligations outstanding Term Loans at such time and (including the Senior Secured Notes) plus (by) the Total Commitment Revolving Commitments at such time (or, after the termination of the Total Revolving Commitment, the Revolving Loans outstanding at such time); provided that, so long as any non-compliance default in respect of this Section 9.08 9.10 is not caused by any voluntary Collateral Disposition, such non-compliance default shall not constitute a Default or an Event of Default (but shall constitute a Default) so long as within 10 Business Days 45 days of the occurrence of such default, the Borrower shall either (i) post additional collateral reasonably satisfactory to the Required Lenders in favor of the Collateral Agent (it being understood that cash collateral comprised of Dollars is satisfactory and that it shall be valued at par)Lenders, pursuant to security documentation reasonably satisfactory in form and substance to the Collateral Agent, in an aggregate amount sufficient to cure such non-compliance default (and shall at all times during such period and prior to satisfactory completion thereof, be diligently carrying out such actions) or (ii) make (x) such repayment of Term Loans and (y) voluntary commitment reductions of the Total Commitment Revolving Commitments in an amount sufficient to cure such non-compliance and repay the Loans and/or cash collateralize the Letters default (it being understood that any action taken in respect of Credit this proviso shall only be effective to cure such default pursuant to this Section 9.10 to the extent required by Section 4.02(athat no Default or Event of Default exists hereunder immediately after giving effect thereto).

Collateral Maintenance. (a) The Borrower Parent will not permit the aggregate Appraised Fair Market Value of all Mortgaged Primary Collateral Vessels owned by the Borrower and the Subsidiary Guarantors Credit Parties which have not been sold, transferred, lost or otherwise disposed of (it being understood that Permitted Chartering Arrangements do not constitute disposals for this purpose) at any time (such value, the “Aggregate Mortgaged Primary Collateral Vessel Value”), as determined by the most recent appraisals appraisal delivered by the Borrower to the Administrative Agent or obtained by the Administrative Agent in accordance with Section 5.12 or Section 8.01(c8.01(d) at any time to be equal less than (xI) prior from the Restatement Effective Date to and including December 31, 2012, 110% of the aggregate principal amount of outstanding Loans at such time plus the Existing Letter of Credit Exposure at such time, (II) from January 1, 20112013 to and including December 31, less than [*] and 2013, 115% of the amount equal to the aggregate principal amount of outstanding Loans at such time plus the Existing Letter of Credit Exposure at such time minus the Blocked Amount, if any, (yIII) from and after January 1, 20112014 to and including September 30, less than [*] 2014, 120% of the sum of (a) amount equal to the then outstanding aggregate principal amount of Other First Lien Obligations outstanding Loans at such time plus the Existing Letter of Credit Exposure at such time minus the Blocked Amount, if any, and (including IV) thereafter, 120% of the Senior Secured Notes) aggregate principal amount of outstanding Loans at such time plus (b) the Total Commitment Existing Letter of Credit Exposure at such time; provided that, so long as any non-compliance default in respect of this Section 9.08 9.09 is not caused by any voluntary Collateral Disposition, such non-compliance default shall not constitute a Default or an Event of Default (but shall constitute a Default) so long as within 10 Business Days 45 days of the occurrence of such default, the Borrower shall either (i) post additional collateral reasonably satisfactory to the Required Lenders in favor of the Collateral Agent (it being understood that cash collateral comprised of Dollars is satisfactory and that it shall be valued at par)Lenders, pursuant to security documentation reasonably satisfactory in form and substance to the Collateral Agent, in an aggregate amount sufficient to cure such non-compliance default (and shall at all times during such period and prior to satisfactory completion thereof, be diligently carrying out such actions) or (ii) make such reductions repayment of the Total Commitment Loans in an amount sufficient to cure such non-compliance and repay the Loans default and/or cash collateralize the Existing Letters of Credit (it being understood that any action taken in respect of this proviso shall only be effective to cure such default pursuant to this Section 9.09 to the extent that no Default or Event of Default exists hereunder immediately after giving effect thereto). (b) In order to comply with clauses (II) and (III) of Section 9.09(a) above, the Parent may, at any time, deposit an amount equal to the amount of Unrestricted Cash and Cash Equivalents held by the Parent and its Subsidiaries at such time such that, after giving effect to such deposit, the Parent would be in compliance with the provisions of Section 9.08 at such time (the “Blocked Amount”) into a non-interest bearing blocked account with Nordea, as depository bank (the “Blocked Account”), with respect to which the Parent shall have duly executed and delivered a control agreement granting a first priority security interest to the Collateral Agent (reasonably satisfactory in all respects to the Collateral Agent), provided that (I) at such time, the Parent shall have furnished to the Administrative Agent a certificate of the senior financial officer of the Parent setting forth the calculations required to establish the amount of the Unrestricted Cash and Cash Equivalents that are required by the Parent in order to establish compliance with the provisions of this Section 4.02(a)9.09 at the time of the deposit of the Blocked Amount into the Blocked Account and (II) notwithstanding anything set forth in Section 9.09 to the contrary, the Parent will not be permitted to deduct the Blocked Amount to establish compliance with the provisions of this Section 9.09 for more than 365 days in the aggregate during the term of this Agreement. The Blocked Amount may be released from such Blocked Account at such time as the Parent shall have furnished to the Administrative Agent a certificate of the senior financial officer of the Parent setting forth the calculations required to establish compliance with the provisions of this Section 9.09 without the deduction of any such Unrestricted Cash and Cash Equivalents so long as no Default or Event of Default exists at such time or would result under Section 9.08 or otherwise from the withdrawal of the Blocked Amount from the Blocked Account. The Collateral Agent may apply the Blocked Amount in accordance with the terms of the Credit Documents at any time if an Event of Default exists at such time or would result from the withdrawal of the Blocked Amount from the Blocked Account.

Collateral Maintenance. The Borrower Commencing with the fiscal quarter ending March 31, 2011, the Parent will not permit the aggregate Appraised Fair Market Value of all Mortgaged Primary Collateral Vessels owned by the Borrower and the Subsidiary Guarantors Credit Parties which have not been sold, transferred, lost or otherwise disposed of (it being understood that Permitted Chartering Arrangements do not constitute disposals for this purpose) at any time (such value, the “Aggregate Mortgaged Primary Collateral Vessel Value”), as determined by the most recent appraisals appraisal delivered by the Borrower to the Administrative Agent or obtained by the Administrative Agent in accordance with Section 5.12 or Section 8.01(c9.01(c) to be (x) prior to January 1, 2011, equal less than [*] and (y) from and after January 1, 2011, less than [*] 135% of the sum of (a) the then outstanding principal amount of Other First Lien Obligations (including the Senior Secured Notes) plus (b) the Total Commitment at such time; provided that, so long as any non-compliance default in respect of this Section 9.08 10.10 is not caused by any voluntary Collateral Disposition, such non-compliance default shall not constitute a Default or an Event of Default (but shall constitute a Default) so long as within 10 Business Days 45 days of the occurrence of such default, the Borrower shall either (i) post additional collateral reasonably satisfactory to the Required Lenders in favor of the Collateral Agent (it being understood that cash collateral comprised of Dollars is satisfactory and that it shall be valued at par)Lenders, pursuant to security documentation reasonably satisfactory in form and substance to the Collateral Agent, in an aggregate amount sufficient to cure such non-compliance default (and shall at all times during such period and prior to satisfactory completion thereof, be diligently carrying out such actions) or (ii) make such reductions of the Total Commitment in an amount sufficient to cure such non-compliance default and repay the Loans and/or cash collateralize the Letters of Credit to the extent required by Section 4.02(a5.02(a) (it being understood that any action taken in respect of this proviso shall only be effective to cure such default pursuant to this Section 10.10 to the extent that no Default or Event of Default exists hereunder immediately after giving effect thereto).

Collateral Maintenance. (a) The Borrower will not permit the aggregate Appraised Market Value of all Mortgaged the Vessels owned by to be less than the Borrower and Required Amount, such test to be determined no more than semi annually as provided in Clause 19.6(c) below, provided that in the Subsidiary Guarantors which have not been soldevent the Facility Agent, transferred, lost or otherwise disposed of (it being understood that Permitted Chartering Arrangements do not constitute disposals for this purpose) (such value, the “Aggregate Mortgaged Vessel Value”), as determined by the most recent appraisals delivered by the Borrower to the Administrative Agent or obtained by the Administrative Agent acting in accordance with Section 5.12 or Section 8.01(c) to Clause 20.30 (Dividends), requests additional valuations, such test shall be (x) prior to January 1, 2011, less determined no more than [*] and (y) from and after January 1, 2011, less than [*] of the sum of (a) the then outstanding principal amount of Other First Lien Obligations (including the Senior Secured Notes) plus quarterly. (b) In the Total Commitment at such time; provided that, so long as any non-compliance event that the Borrower fails to meet the ratio set out in respect of this Section 9.08 is not caused by any voluntary Collateral Disposition, such non-compliance shall not constitute a Default or an Event of Default so long as within 10 Business Days of the occurrence of such defaultClause 19.6, the Borrower shall shall, within thirty (30) days of notice being given by the Facility Agent so to do, either (i) post additional collateral reasonably satisfactory to prepay such amount of the Credits as will ensure that the aggregate of the Market Value of the Vessels is not less than the Required Lenders Amount in favor respect of the Collateral Agent (it being understood that cash collateral comprised of Dollars is satisfactory and that it shall be valued at par), pursuant to security documentation reasonably satisfactory in form and substance to the Collateral Agent, in an aggregate amount sufficient to cure such non-compliance (and shall at all times during such period and prior to satisfactory completion thereof, be diligently carrying out such actions) Vessels; or (ii) make provide or cause to be provided to the Security Trustee additional collateral, such reductions collateral to be in all respects satisfactory to the Facility Agent (acting on the instructions of all Lenders), such that the Required Amount is again met provided that, for the avoidance of doubt, such additional security will be required to have such value (as the Facility Agent then determines to be appropriate) such that the Required Amount is again met. (c) Except as provided in the proviso to Clause 19.6(a) when the collateral maintenance test may be effected on no more than a quarterly basis, the Facility Agent shall be entitled to effect such collateral maintenance test on a semi-annual basis and shall base its calculations on the average of the then most recent Valuations provided by two (2) of the Approved Valuers in accordance with Clause 22 (Valuations). (d) If any Vessel becomes a Total Commitment Loss, it shall, as of the earlier of (i) the date of receipt by the Facility Agent of the proceeds of insurance relating to such Total Loss and (ii) the date falling one hundred and twenty (120) days after the occurrence of the relevant event of Total Loss, cease to be a Vessel for the purposes of this Clause 19.6 unless the underwriters agree to settle any insurance claim in respect or such Vessel for an amount sufficient not less than the Market Value of such Vessel within one hundred and twenty (120) days from the occurrence of the event giving rise to cure such non-compliance and repay Total Loss, PROVIDED that, if any insurance proceeds or Requisition Compensation are received by either the Loans and/or cash collateralize Security Trustee or the Letters Facility Agent in respect of Credit to the extent required by Section 4.02(aa Total Loss of such Vessel they shall be applied in accordance with Clause 6.2(b). (e) If at any time any Vessel is not insured in accordance with the terms of the Security Documents and this Agreement then, for so long as such Vessel is not insured in accordance with such requirements, such Vessel shall, if the Facility Agent so determines, cease to be deemed a Vessel for the purposes of this Clause 19.6. Clauses 8.7 and 8.9 shall apply, mutatis mutandis, to any prepayment made pursuant to this Clause 19.6(b). Any prepayment made in accordance with this Clause shall be applied pro rata across all of the Loans.

Collateral Maintenance. (a) The Borrower Parent will not permit the aggregate Appraised Fair Market Value of all Mortgaged Primary Collateral Vessels owned by the Borrower and the Subsidiary Guarantors Credit Parties which have not been sold, transferred, lost or otherwise disposed of (it being understood that Permitted Chartering Arrangements do not constitute disposals for this purpose) at any time (such value, the “Aggregate Mortgaged Primary Collateral Vessel Value”), as determined by the most recent appraisals appraisal delivered by the Borrower to the Administrative Agent or obtained by the Administrative Agent in accordance with Section 5.12 or Section 8.01(c8.01(d) at any time to be equal less than (xI) prior from the Restatement Effective Date to and including December 31, 2012, 110% of the aggregate principal amount of outstanding Loans at such time, (II) from January 1, 20112013 to and including December 31, less than [*] and 2013, 115% of the amount equal to the aggregate principal amount of outstanding Loans at such time minus the Blocked Amount, if any, (yIII) from and after January 1, 20112014 to and including September 30, less than [*] 2014, 120% of the sum of (a) amount equal to the then outstanding aggregate principal amount of Other First Lien Obligations outstanding Loans at such time minus the Blocked Amount, if any, and (including IV) thereafter, 120% of the Senior Secured Notes) plus (b) the Total Commitment aggregate principal amount of outstanding Loans at such time; provided that, so long as any non-compliance default in respect of this Section 9.08 9.09 is not caused by any voluntary Collateral Disposition, such non-compliance default shall not constitute a Default or an Event of Default (but shall constitute a Default) so long as within 10 Business Days 45 days of the occurrence of such default, the Borrower shall either (i) post additional collateral reasonably satisfactory to the Required Lenders in favor of the Collateral Agent (it being understood that cash collateral comprised of Dollars is satisfactory and that it shall be valued at par)Lenders, pursuant to security documentation reasonably satisfactory in form and substance to the Collateral Agent, in an aggregate amount sufficient to cure such non-compliance default (and shall at all times during such period and prior to satisfactory completion thereof, be diligently carrying out such actions) or (ii) make such reductions repayment of the Total Commitment Loans in an amount sufficient to cure such non-compliance and repay the Loans and/or cash collateralize the Letters default (it being understood that any action taken in respect of Credit this proviso shall only be effective to cure such default pursuant to this Section 9.09 to the extent that no Default or Event of Default exists hereunder immediately after giving effect thereto). (b) In order to comply with clauses (II) and (III) of Section 9.09(a) above, the Parent may, at any time, deposit an amount equal to the amount of Unrestricted Cash and Cash Equivalents held by the Parent and its Subsidiaries at such time such that, after giving effect to such deposit, the Parent would be in compliance with the provisions of Section 9.08 at such time (the “Blocked Amount”) into a non-interest bearing blocked account with Nordea, as depository bank (the “Blocked Account”), with respect to which the Parent shall have duly executed and delivered a control agreement granting a first priority security interest to the Collateral Agent (reasonably satisfactory in all respects to the Collateral Agent), provided that (I) at such time, the Parent shall have furnished to the Administrative Agent a certificate of the senior financial officer of the Parent setting forth the calculations required to establish the amount of the Unrestricted Cash and Cash Equivalents that are required by the Parent in order to establish compliance with the provisions of this Section 4.02(a)9.09 at the time of the deposit of the Blocked Amount into the Blocked Account and (II) notwithstanding anything set forth in Section 9.09 to the contrary, the Parent will not be permitted to deduct the Blocked Amount to establish compliance with the provisions of this Section 9.09 for more than 365 days in the aggregate during the term of this Agreement. The Blocked Amount may be released from such Blocked Account at such time as the Parent shall have furnished to the Administrative Agent a certificate of the senior financial officer of the Parent setting forth the calculations required to establish compliance with the provisions of this Section 9.09 without the deduction of any such Unrestricted Cash and Cash Equivalents so long as no Default or Event of Default exists at such time or would result under Section 9.08 or otherwise from the withdrawal of the Blocked Amount from the Blocked Account. The Collateral Agent may apply the Blocked Amount in accordance with the terms of the Credit Documents at any time if an Event of Default exists at such time or would result from the withdrawal of the Blocked Amount from the Blocked Account.

Collateral Maintenance. The Borrower will not permit the aggregate sum of (i) the Aggregate Appraised Value of all Mortgaged the Collateral Vessels owned by the Borrower and the Subsidiary Guarantors which have not been sold, transferred, lost or otherwise disposed of (it being understood that Permitted Chartering Arrangements permitted chartering arrangements do not constitute disposals for this purpose) and (such valueii) any Additional Collateral (subparagraphs (i) and (ii) hereof, hereinafter referred to as, the “Aggregate Mortgaged Vessel ValueCollateral Maintenance Ratio”)) (A) for the period, as determined by through and including the most recent appraisals delivered by the Borrower period ending December 31, 2015, to the Administrative Agent or obtained by the Administrative Agent in accordance with Section 5.12 or Section 8.01(c) fall below an amount that is equal to be (x) prior to January 1, 2011, less than [*] and (y) from and after January 1, 2011, less than [*] 130% of the sum of (a) the then aggregate outstanding principal amount of Other First Lien Obligations the Loans (including provided that upon the Senior Secured Notesmaking of any advance under a Term Loan, the Collateral Maintenance Ratio shall not be permitted to fall below an amount that is equal to 140% of the aggregate outstanding principal amount of the Loans); and (B) plus (bthereafter to fall below an amount that is equal to 140% of the aggregate outstanding principal amount of the Loans; provided, further, that any non-compliance with this Section 8.07(d) the Total Commitment at such time; provided thatshall not constitute an Event of Default, so long as any non-compliance in respect of this Section 9.08 is not caused by any voluntary Collateral Disposition, such non-compliance shall not constitute a Default or an Event of Default so long as within 10 Business Days 60 days of the occurrence of such defaultnon-compliance, the Borrower shall either (ix) post additional collateral reasonably satisfactory to the Required Lenders in favor of the Additional Collateral Agent (it being understood that cash collateral comprised of Dollars is satisfactory and that it shall be valued at par), pursuant to security documentation reasonably satisfactory in form and substance to the Collateral Agent, in an aggregate amount sufficient to cure such non-compliance (and shall at all times during such period period, and prior to satisfactory completion thereof, be diligently carrying out such actions) or (it being agreed that (A) the “GENCO PIONEER” and the “GENCO PROGRESS” are hereby deemed satisfactory to the Required Lenders) and (B) in respect of any Fleet Vessel owned by Genco as of the Amendment No.1 Effective Date, if such Fleet Vessel is, at the time of its posting as Additional Collateral, (i) younger than 16 years in age, it shall be deemed satisfactory to the Required Lenders and (ii) make such reductions 16 years or older in age, it shall be Additional Collateral only with the consent of the Total Commitment Administrative Agent acting at the instruction of the Required Lenders, such consent and instruction not to be unreasonably withheld), (y) prepay Loans in an amount sufficient to cure such non-compliance and repay or (z) permanently reduce the Loans and/or cash collateralize the Letters of Credit to the extent required by Section 4.02(a).Total Commitment;

Collateral Maintenance. The Borrower Parent will not permit the aggregate Appraised Value sum of the fair market value of all Mortgaged Vessels owned by the Borrower and the Subsidiary Guarantors Collateral Rigs which have not been sold, transferred, lost or otherwise disposed of (it being understood that Permitted Chartering Arrangements do not constitute disposals for this purpose) of, on an individual charter-free basis, at any time (such value, the “Aggregate Mortgaged Vessel Collateral Rig Value”), as determined by calculating the appraised value set forth in the most recent appraisals appraisal report related to each respective Collateral Rig and delivered by the Borrower to the Administrative Agent or obtained by the Administrative Agent in accordance with Section 5.12 or Section 8.01(c) 9.01(c), to be (x) prior to January 1, 2011, equal less than [*] and (y) from and after January 1, 2011, less than [*] 150% of the sum of (a) the then aggregate outstanding principal amount of Other First Lien Obligations (including the Senior Secured Notes) plus (b) the Total Commitment Loans at such time; provided that, (x) for the avoidance of doubt, it is understood and agreed that the appraisal reports delivered on February 25, 2011 from Fearnleys Ltd. and February 22, 2011 from Pareto Offshore AS shall be satisfactory for the purpose of making the calculation in this Section 10.09 from the Initial Borrowing Date until the next required date of delivery of appraisal reports under this Agreement; (y) so long as any non-compliance in respect violation of this Section 9.08 10.09 is not caused by any voluntary Collateral Disposition, such non-compliance violation shall not constitute a Default or an Event of Default so long as within 10 Business Days 60 days of the occurrence of such defaultviolation, the Borrower shall either (i) post additional collateral reasonably (at the expense of the Borrower) satisfactory to the Required Lenders in favor of the Collateral Agent (it being understood that cash collateral comprised of Dollars is satisfactory and that it shall be valued at par)Lenders, pursuant to security documentation reasonably the Collateral and Guaranty Requirements and otherwise satisfactory in form and substance to the Collateral Agent, in an aggregate amount sufficient to cure such non-compliance violation (and shall at all times during such period and prior to satisfactory completion thereof, be diligently carrying out such actions) or (ii) make such reductions of to the Total Commitment (and any required repayments of outstanding Loans of any relevant Tranche resulting therefrom) in an amount sufficient to cure such non-compliance and repay the Loans and/or cash collateralize the Letters violation (it being understood that any action taken in respect of Credit this proviso shall only be effective to cure such violation pursuant to this Section 10.09 to the extent required by Section 4.02(a)that no Default or Event of Default exists hereunder immediately after giving effect thereto) and (z) the value of any Collateral Rig shall not be included in the Aggregate Collateral Rig Value until such time as such Collateral Rig has been delivered to the Borrower or a Wholly-Owned Subsidiary of the Borrower and the Collateral and Guaranty Requirements have been fully satisfied.