FORM OF INSURANCE ASSIGNMENT
M/V __________________
_______________, a corporation organized and existing under
the laws of the ______________ (the "Shipowner"), in consideration of One Dollar
($1) lawful money of the United States of America, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, as
sole owner of the ____________ flag vessel M/V ______________ (the "Vessel"),
has sold, assigned, transferred, set over and granted a security interest and by
this instrument does sell, assign, transfer, set over and grant a security
interest, unto The First National Bank of Maryland, a national banking
association organized and existing under the laws of the United States of
America, as Trustee and Collateral Agent (the "Assignee") under that certain
Collateral Agency and Intercreditor Agreement dated as of July 15, 1998 (as the
same may be from time to time amended, supplemented or otherwise modified, the
"Collateral Agency Agreement") among (i) the Shipowner, (ii) the certain other
Subsidiary Guarantors named therein, (iii) the Assignee, (iv) The Bank of New
York and (v) Millenium Seacarriers, Inc. (the "Issuer") and unto the Assignee's
successors and assigns, and its successors' and assigns' own proper use and
benefit, as collateral security for the Shipowner's Obligations (as defined in
the Collateral Agency Agreement), all right, title and interest of the Shipowner
under, in and to (i) all insurances (including all entries in a protection and
indemnity or war risks association) in respect of the Vessel whether now or
hereafter to be effected, and all renewals of or replacements for the same, (ii)
all claims, returns of premium and other moneys and claims for moneys due and to
become due under said insurance or in respect of said insurance, (iii) all other
rights of the Shipowner under or in respect of said insurance and (iv) any
proceeds of any of the foregoing.
Except where otherwise expressly provided, words and
expressions defined in the Indenture shall bear the same meanings when used in
this Assignment.
It is expressly agreed that anything herein contained to the
contrary notwithstanding, the Shipowner shall remain liable under said
insurances to perform all of the obligations assumed by it thereunder, and the
Assignee shall have no obligation or liability under said insurances by reason
of or arising out of this instrument of assignment nor shall the Assignee be
required or obligated in any manner to perform or fulfill any obligations of the
Shipowner under or pursuant to said insurances or to make any payment or to make
any inquiry as to the nature or sufficiency of any payment received by it or to
present or file any claim, or to take any other action to collect or enforce the
payment of any amounts which may have been assigned to it or to which it may be
entitled hereunder at any time or times.
The Shipowner hereby constitutes the Assignee, its successors
and assigns, the Shipowner's true and lawful attorney-in-fact, irrevocably, with
full power (in the name of the Shipowner or otherwise), to ask, require, demand,
receive, compound and give acquittance for any and all moneys and claims for
moneys due and to become due under or arising out of said insurances, to settle
or comprise any claims, to endorse any checks or other instruments or orders in
connection therewith and to file any claims or to take any action or institute
any proceeding
which the Assignee may deem to be necessary or advisable in the premises. The
powers and authorities granted to the Assignee and its successors or assigns
herein have been given for valuable consideration and are hereby declared to be
irrevocable.
The Shipowner covenants and agrees that:
(a) the insurances assigned hereby are now valid and in
full force and effect and that the Shipowner will not
do or omit or knowingly suffer to be done or omitted
anything whereby any of the insurances assigned
hereby may become void or voidable in whole or in
part or the Assignee or any other person claiming
title through it may be prevented from receiving the
proceeds thereof;
(b) if by reason of anything done or omitted or knowingly
suffered to be done or omitted the insurances
assigned hereby shall at any time become voidable in
whole or in part the Shipowner will forthwith at its
own cost take all such insurances in force and in
particular will pay all premiums as they become due;
(c) if by reason of anything done or omitted or knowingly
suffered to be done or omitted the insurances
assigned hereby or any of them shall at any time
become void in whole or in part the Shipowner at its
own cost will forthwith effect new insurances with
insurers approved by the Assignee on terms approved
by the Assignee and will forthwith (if so required by
the Assignee) execute an assignment of such new
insurances to the Assignee and will pay any sums
payable by way of premium under the new insurances.
The Shipowner hereby further covenants and agrees to procure
that notice of this Assignment in substantially the form of Annex A shall be
duly given to all underwriters and that where the consent of any underwriter is
required pursuant to any of the insurances assigned hereby that it shall be
obtained and evidence thereof shall be given to the Assignee, or, in the
alternative, that in the case of protection and indemnity coverage the Assignee
shall obtain a letter of undertaking by the underwriters, and that there shall
be duly endorsed upon all slips, cover notes, policies, certificates of entry or
other instruments issued or to be issued in connection with the insurances
assigned hereby such clauses as to loss payees as the Assignee may require or
approve. In all cases, unless otherwise agreed in writing by the Assignee, such
slips, cover notes, notices, certificates of entry or other instruments shall
show the Assignee as named assured and loss payee and shall provide that there
will be no recourse against the Assignee for payment of premiums, calls or
assessments.
The Shipowner agrees that at any time and from time to time,
upon the written request of the Assignee, the Shipowner will promptly and duly
execute and deliver or cause to be executed and delivered any and all such
further instruments and documents as the Assignee may deem desirable in
obtaining the full benefits of this Assignment and of the rights and powers
herein granted.
The Shipowner does hereby warrant and represent that it has
not assigned or pledged, and hereby covenants that, without the prior written
consent thereto of the Assignee, so long as this instrument of assignment shall
remain in effect, it will not assign or pledge the whole or any part of the
right, title and interest hereby assigned to anyone other than the Assignee, its
successors or assigns, and it will not take or omit to take any action, the
taking or omission of which might result in an alteration or impairment of said
insurances, of this Assignment or of any of the rights created by said
insurances or this Assignment.
All notices or other communications which are required to be
made to the Assignee hereunder shall be made pursuant to Section 7.2 of the
Collateral Agency Agreement.
The Shipowner hereby appoints the Assignee its
attorney-in-fact for the sole purpose of executing and filing any financing
statements or papers of similar purpose or effect in connection with any filing
or recording of this Assignment.
THIS ASSIGNMENT SHALL IN ALL RESPECTS BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL
MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE. This Assignment shall not be
amended and/or varied except by agreement in writing signed by the parties
hereto.
Section 7.12 of the Collateral Agency Agreement is
incorporated herein in its entirety and made a part hereof as if it were set
forth herein.
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, the Shipowner has duly executed this
Insurance Assignment in respect of the ____________ flag vessel M/V
________________ this ____ day of __________, 199__.
--------------------------------
as Shipowner
By
--------------------------------
Name:
Title: