Eagle Bulk Shipping Inc.

Restructuring Support Agreement

¹

Capitalized terms not otherwise defined herein shall have the meaning ascribed to them in the Plan or Credit Agreement, as applicable.

(a)

on or before August 6, 2014, EBS shall commence a solicitation of the Lenders seeking the approval and acceptance of the Plan;

(b)

on or before August 6, 2014, EBS shall receive the approval and acceptance of the Plan by Lenders collectively constituting the Required Lenders as of such date (the “Lender Class Acceptance”);

(c)

upon the occurrence of the Lender Class Acceptance, EBS shall commence the Chapter 11 Case on or before August 6, 2014;

(d)

no later than the date of the commencement of the Chapter 11 Case (the “Petition Date”), EBS shall file with the Bankruptcy Court the Plan, the Disclosure Statement, a motion seeking approval of the DIP Facility (as defined below), and a motion seeking a joint hearing to consider the adequacy of the Disclosure Statement, approval of the Company’s prepetition solicitation of the Lenders, and confirmation of the Plan (the “Joint Disclosure Statement and Plan Confirmation Hearing”);

(e)

no later than 5 business days after the Petition Date, the Bankruptcy Court shall enter a final order scheduling the Joint Disclosure Statement and Plan Confirmation Hearing;

(f)

no later than 5 business days after the Petition Date, the Bankruptcy Court shall enter the Interim Financing Order in the form annexed hereto or in such other form as is reasonably acceptable to the Company and the Majority Consenting Lenders, authorizing the Company to enter into a post-petition credit facility (the “DIP Facility”) and use cash collateral, and scheduling a final hearing with respect to such matters;

(g)

no later than 37 days after the Petition Date, the Bankruptcy Court shall enter the Final Financing Order in a form reasonably acceptable to the Company and the Majority Consenting Lenders;

(h)

no later than 37 days after the Petition Date, the Bankruptcy Court shall commence the Joint Disclosure Statement and Plan Confirmation Hearing;

(i)

no later than 45 days after the Petition Date, the Bankruptcy Court shall enter an order (1) approving the adequacy of the Disclosure Statement and the Company’s prepetition solicitation of the Lenders and (2) confirming the Plan (the “Confirmation Order”); and

(j)

no later than 60 days after the Petition Date, the effective date of the Plan (the “Consummation Date”) shall occur.

(a)

support and take all actions necessary or reasonably requested by the Company to facilitate consummation of the Restructuring, including without limitation, to (i) timely vote all of its claims (as defined in section 101(5) of the Bankruptcy Code) against, and interests in, the Company, now or hereafter owned by such Consenting Lender or for which it now or hereafter serves as the nominee, investment manager, or advisor for holders thereof, to accept the Plan in accordance with the applicable procedures set forth in the Disclosure Statement and the solicitation materials with respect to the Plan, provided, further, that any Consenting Lender, simultaneously with its execution of this Agreement, shall deliver and release to the Company’s solicitation agent such Consenting Lender’s executed ballot accepting the Plan, and (ii) to the extent such election is available, not elect on its ballot to preserve claims, if any, that each Consenting Lender may own or control that may be affected by any releases contemplated by the Plan;

(b)

not withdraw, amend, or revoke (or cause to be withdrawn, amended, or revoked) its vote with respect to the Plan;

(c)

(i) support the confirmation of the Plan and approval of the Disclosure Statement and the solicitation procedures and (ii) not (1) object to, delay, interfere, impede, or take any other action to delay, interfere or impede, directly or indirectly, with the Restructuring, confirmation of the Plan, or approval of the Disclosure Statement or the solicitation procedures (including, but not limited to, joining in or supporting any efforts to object to or oppose any of the foregoing), or (2) propose, file, support, or vote for, directly or indirectly, any restructuring, workout, or chapter 11 plan for the Company other than the Restructuring and the Plan;

(d)

not commence any proceeding to oppose or alter any of the terms of the Plan or any other document filed by EBS or the Company in connection with the confirmation of the Plan (as long as such documents are materially consistent with the terms and conditions of this Agreement);

(e)

support (and not object to) the “first day” motions and other motions consistent with this Agreement filed by EBS or the Company in furtherance of the Restructuring, including, but not limited to, any motion seeking approval of the DIP Facility on the terms set forth in the Financing Orders;

(f)

not, nor encourage any other person or entity to, take any action, including, without limitation, initiating or joining in any legal proceeding, which is inconsistent with this Agreement, or delay, impede, appeal, or take any other negative action, directly or indirectly, that could reasonably be expected to interfere with the approval, acceptance, confirmation, consummation, or implementation of the Restructuring or the Plan, as applicable;

(g)

use commercially reasonable efforts to execute any document and give any notice, order, instruction, or direction necessary or reasonably requested by the Company to support, facilitate, implement, consummate, or otherwise give effect to the Restructuring;

(h)

use good faith efforts to negotiate, execute and implement the Definitive Documentation on terms not materially inconsistent with the Term Sheet, including the exhibits thereto;

(i)

support (and not object to) the Company’s efforts to obtain the Exit Financing Facility, and not object to, or support the efforts of any other Person to oppose or object to, the Exit Financing Facility;

(j)

support (and not object to), and enter into any amendments to the Finance Documents and/or provide direction and instructions to the Agent and the Security Trustee (each as defined in the Credit Agreement) as may be reasonably requested by the Company to effectuate, the priming, subordination and/or release of (i) all claims against the Company (including, for the avoidance of doubt, EBS’ subsidiaries) under the Finance Documents and (ii) the liens, security interests, mortgages and other encumbrances granted by the Company (including, for the avoidance of doubt, EBS’ subsidiaries) securing the obligations under the Finance Documents, in each case as contemplated pursuant to, and in order to facilitate the implementation and/or consummation of, (1) the DIP Facility and the Financing Orders, (2) the Plan, and (3) the Exit Financing Facility (as defined in the Plan);

(k)

support the Company’s efforts to remain listed on the NASDAQ Global Select Market (“NASDAQ”) and, if the Company loses its NASDAQ listing for any reason prior to the consummation of the Restructuring, support the Company’s good faith efforts to become relisted on NASDAQ;

(l)

not exercise any right or remedy or take any action (or initiate, join in, or encourage in any way an instruction or direction to any other party, including, but not limited to, the Agent or the Security Trustee, to take any action) in respect of any potential, actual, or alleged occurrence of any “Default” or “Event of Default” under the Credit Agreement that exists or otherwise has been acknowledged as of the date hereof and is described on Schedule 1 hereto or that would be triggered as a result of the commencement or pendency of the Chapter 11 Case(s); and

(m)

not instruct (or join in any direction requesting that) the Agent and/or Security Trustee under the Credit Agreement or the related loan documents to take any action, or refrain from taking any action, that would be inconsistent with this Agreement or the Restructuring.

(a)

Subject to paragraph (b) immediately below, the Company (i) agrees to (A) support and complete the Restructuring and all transactions set forth in the Plan and this Agreement, (B) complete the Restructuring and all transactions set forth or described in the Plan in accordance with the Milestones set forth in Section 3 of this Agreement, (C) negotiate in good faith all Definitive Documentation that is subject to negotiation as of the Effective Date, (D) take any and all necessary actions in furtherance of the Restructuring, this Agreement, and the Plan, (E) make commercially reasonable efforts to obtain any and all required regulatory and/or third-party approvals for the Restructuring, and (F) use good faith efforts to negotiate, execute and implement the Definitive Documentation on terms not materially inconsistent with the Term Sheet, including the exhibits thereto, and (ii) shall not undertake any actions materially inconsistent with the adoption and implementation of the Plan and confirmation thereof.

(b)

Notwithstanding anything to the contrary herein, (i) the Company’s obligations hereunder (including, without limitation, the obligations of the Company’s board of directors and officers) are subject at all time to the fulfillment of their respective fiduciary duties, (ii) nothing in this Agreement shall require the Company, the board of directors, or officers of any Eagle Entity to take any action, or to refrain from taking any action, that is required to comply with such director’s, officer’s, or manager’s fiduciary obligations under applicable law, and (iii) to the extent that such fiduciary obligations require the Company, the board of directors, or officers to terminate the Company’s obligations under this Agreement, the Company, the board of directors, and/or the officers may do so without incurring any liability to any Party under this Agreement except as otherwise set forth herein.

(a)

the failure to meet any Milestone, unless such failure is the result of any act, omission, or delay on the part of any Consenting Lender or such Milestone is waived in accordance herewith;

(b)

the occurrence of a material breach of this Agreement by the Company that has not been cured (if susceptible to cure) within five (5) days after the receipt by the Company of written notice of such breach;

(c)

the occurrence of (i) any Event of Default under (and as defined in) the Credit Agreement (other than any Acknowledged Default or any Event of Default triggered as a result of the commencement or pendency of the Chapter 11 Cases) or the DIP Credit Agreement or (ii) a violation of the Company’s obligations under Financing Orders, in each case, which Event of Default or violation has not been cured (if susceptible to cure) in accordance with the terms set forth therein;

(d)

entry of an order by the Bankruptcy Court converting the Chapter 11 Case to a case under chapter 7 of the Bankruptcy Code;

(e)

entry of an order by the Bankruptcy Court appointing a trustee, receiver, or examiner with expanded powers beyond those set forth in section 1106(a)(3) and (4) of the Bankruptcy Code in the Chapter 11 Case;

(f)

entry of an order by the Bankruptcy Court terminating any Eagle Entity’s exclusive right to file a plan of reorganization pursuant to section 1121 of the Bankruptcy Code;

(g)

any Eagle Entity amends or modifies, or files a pleading seeking authority to amend or modify, the Definitive Documentation, unless such amendment or modification is (i) consistent with this Agreement or (ii) reasonably acceptable to the Majority Consenting Lenders;

(h)

entry of an order by the Bankruptcy Court amending or modifying the Definitive Documentation, unless such amendment or modification is (i) consistent with this Agreement or (ii) reasonably acceptable to the Majority Consenting Lenders;

(i)

either (i) the board of directors of any Eagle Entity and the officers of such Eagle Entity determine to pursue any Alternative Transaction (as defined below), including any plan of reorganization (other than the Plan) or (ii) any Eagle Entity files, propounds, or otherwise publicly supports or announces that any Eagle Entity will support any Alternative Transaction, including any plan of reorganization other than the Plan, or files any motion or application seeking authority to sell any material assets, without the prior written consent of the Majority Consenting Lenders;

(j)

the issuance by any governmental authority, including the Bankruptcy Court, any regulatory authority, or any other court of competent jurisdiction, of any ruling or order enjoining the substantial consummation of the Restructuring; provided, however, that the Company shall have five (5) days after issuance of such ruling or order to obtain relief that would allow consummation of the Restructuring in a manner that (i) does not prevent or diminish in a material way compliance with the terms of the Plan and this Agreement or (ii) is reasonably acceptable to the Majority Consenting Lenders;

(k)

the Bankruptcy Court enters any order authorizing the use of cash collateral or post-petition financing that is not substantially in the form of the Interim Financing Order or otherwise consented to by the Majority Consenting Lenders;

(l)

either (i) any Eagle Entity files a motion, application or adversary proceeding (or supports such a filing) (1) challenging the validity, enforceability, perfection or priority of, or seeking avoidance or subordination of, the loans under the Credit Agreement or the DIP Credit Agreement or the liens securing such obligations, (2) asserting any other cause of action against and/or with respect or relating to such obligations or the liens securing such obligations, or (3) challenging the validity of the Warrants, the Warrant Agreement (as amended) or any claims asserted by a holder of such Warrants (to the extent such holder is also a Consenting Lender) in respect of such Warrants; or (ii) the Bankruptcy Court (or any court with jurisdiction over the Chapter 11 Cases) enters an order providing relief against the interests of the Consenting Lenders (in their capacity as holders of loans under the Credit Agreement or the DIP Credit Agreement or as holders of Warrants) with respect to any of the foregoing causes of action or proceedings;

(m)

a breach by any Eagle Entity of any representation, warranty, or covenant of such Eagle Entity set forth in Section 16(b) of this Agreement that could reasonably be expected to have a material adverse impact on the Restructuring or the consummation of the Restructuring that (if susceptible to cure) remains uncured for a period of five (5) days after the receipt by the Company of written notice of such breach;

(n)

a breach by any Eagle Entity of any of its obligations under this Agreement that could reasonably be expected to have a material adverse impact on the Restructuring or the consummation of the Restructuring that (if susceptible to cure) remains uncured for a period of five (5) days after the receipt by the Company of written notice of such breach;

(o)

the Exit Financing amount or terms differ in a meaningful way from the terms of that certain financing proposal received by the Company on July 29, 2014 reflecting a $225,000,000 term loan component and a $50,000,000 revolving credit facility component; or

(p)

the Consummation Date shall not have occurred by November 30, 2014.

(a)

a breach by a Consenting Lender of any of the representations, warranties, or covenants of such Consenting Lender set forth in Section 15 of this Agreement that that could reasonably be expected to have a material adverse impact on the Restructuring or the consummation of the Restructuring that (if susceptible to cure) remains uncured for a period of five (5) days after the receipt by the Consenting Lenders of written notice of such breach;

(b)

a breach by any Consenting Lender of any of its obligations under this Agreement that could reasonably be expected to have a material adverse impact on the Restructuring or the consummation of the Restructuring that (if susceptible to cure) remains uncured for a period of five (5) days after the receipt by the Consenting Lenders of written notice of such breach;

(c)

the Company’s board of directors determines, (i) consistent with Section 6(b) above that continued pursuit or support of the Restructuring (including, without limitation, the Plan or the solicitation of the Plan) would be inconsistent with the exercise of its fiduciary duties or (ii) to pursue an Alternative Transaction consistent with Section 17 below;

(d)

the Consenting Lenders at any time constitute less than the Required Lenders;

(e)

the issuance by any governmental authority, including the Bankruptcy Court or any other regulatory authority or court of competent jurisdiction, of any injunction, judgment, decree, charge, ruling, or order preventing the consummation of a material portion of the Restructuring; or

(f)

the Consummation Date shall not have occurred by November 30, 2014.

(a)

Each of the Consenting Lenders hereby represents and warrants on a several and not joint basis for itself and not any other person or entity that the following statements are true, correct, and complete as of the date hereof:

(i)

it is duly organized, validly existing, and in good standing under the laws of the jurisdiction of its organization, and it has the requisite corporate power and authority to enter into this Agreement and to carry out the transactions contemplated by, and perform its respective obligations under, this Agreement;

(ii)

the execution and delivery of this Agreement and the performance of its obligations hereunder have been duly authorized by all necessary corporate or other organizational action on its part and no other proceedings on its part are necessary to authorize and approve this Agreement or any of the transactions contemplated herein;

(iii)

this Agreement has been duly executed and delivered by the Consenting Lender and constitutes the legal, valid, and binding agreement of the Consenting Lender, enforceable against the Consenting Lender in accordance with its terms;

(iv)

the execution, delivery, and performance by it of this Agreement does not and shall not (A) violate any provision of law, rule, or regulation applicable to it, or its certificate of incorporation or bylaws or other organizational documents, or (B) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any material contractual obligation to which it is a party;

(v)

the execution, delivery, and performance by it of this Agreement does not and shall not require any registration or filing with, consent or approval of, notice to, or any other action to, with, or by any federal, state or other governmental authority or regulatory body, except (A) any of the foregoing as may be necessary and/or required for disclosure by the Securities and Exchange Commission and applicable state securities or “blue sky” laws, (B) any of the foregoing as may be necessary and/or required in connection with the Chapter 11 Cases, including the approval of the Disclosure Statement and confirmation of the Plan, (C) filings of amended certificates of incorporation or articles of formation or other organizational documents with applicable state authorities, and other registrations, filings, consents, approvals, notices, or other actions that are reasonably necessary to maintain permits, licenses, qualifications, and governmental approvals to carry on the business of the Company, and (D) any other registrations, filings, consents, approvals, notices, or other actions, the failure of which to make, obtain, or take, as applicable, would not be reasonably likely, individually or in the aggregate, to materially delay or materially impair the ability of any Party hereto to consummate the transactions contemplated hereby;

(vi)

subject to the provisions of sections 1125 and 1126 of the Bankruptcy Code, this Agreement is the legally valid and binding obligation of it, enforceable against it in accordance with its terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium, or other similar laws relating to or limiting creditors’ rights generally, or by equitable principles relating to enforceability;

(vii)

it (A) is a sophisticated party with respect to the transactions described herein with sufficient knowledge and experience in financial and business matters and is capable of evaluating the merits and risks of owning and investing in securities of the Company (including any securities that may be issued in connection with the Restructuring), making an informed decision with respect thereto, and evaluating properly the terms and conditions of the Plan and this Agreement, (B) has been represented and advised by legal and financial advisors in connection with this Agreement, (C) has been afforded the opportunity to discuss the Plan, the Disclosure Statement and other information concerning the Company with the Company’s representatives, (D) has independently and without reliance upon the Company or any officer, employee, agent, or representative thereof, and based on such information as the Consenting Lender has deemed appropriate, made its own analysis and decision to enter into this Agreement and will not seek rescission or revocation of this Agreement, and (E) acknowledges that it has entered into this Agreement voluntarily and of its own choice and not under coercion or duress;

(viii)

it (A) is the sole legal or beneficial owner of the principal amount of claims set forth on Exhibit G, has all necessary investment or voting discretion with respect to such claims, or otherwise has the power and authority to bind any other legal or beneficial holder of such claims, free and clear of any pledge, lien, security interest, charge, claim, equity, option, proxy, voting restriction, right of first refusal or other limitation on disposition, or encumbrances of any kind, and (B) is exclusively entitled (for its own accounts or for the accounts of such other legal or beneficial owners) to all of the rights and economic benefits of such claims; and

(ix)

it has made no prior assignment, sale, participation, grant, conveyance, or other transfer of, and has not entered into any other agreement to assign, sell, participate, grant, convey, or otherwise transfer, in whole or in part, any portion of its right, title, or interest in any claim set forth on Exhibit G, except to the extent such agreement is in accordance with the terms of this Agreement.

(b)

Each of the Eagle Entities hereby represents and warrants on a several and not joint basis for itself and not any other person or entity that the following statements are true, correct, and complete as of the date hereof:

(i)

it is duly organized, validly existing, and in good standing under the laws of the jurisdiction of its organization, and it has the requisite corporate power and authority to enter into this Agreement and to carry out the transactions contemplated by, and perform its respective obligations under, this Agreement;

(ii)

the execution and delivery of this Agreement and the performance of its obligations hereunder have been duly authorized by all necessary corporate or other organizational action on its part, including approval of each of the independent director(s) of each of the corporate entities that comprise the Eagle Entities;

(iii)

the execution, delivery, and performance by it of this Agreement does not and shall not (A) violate any provision of law, rule, or regulation applicable to it, or its certificate of incorporation or bylaws or other organizational documents, or (B) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any material contractual obligation to which it is a party (other than, for the avoidance of doubt, a default that would be triggered as a result of the Chapter 11 Case(s) or any Eagle Entity’s undertaking to implement the Restructuring through the Chapter 11 Case(s))

(iv)

this Agreement has been duly executed and delivered by the Company and constitutes the legal, valid, and binding agreement of the Company, enforceable against the Company in accordance with its terms;

(v)

the execution, delivery, and performance by it of this Agreement does not and shall not require any registration or filing with, consent or approval of, notice to, or any other action to, with, or by any federal, state or other governmental authority or regulatory body, except (A) any of the foregoing as may be necessary and/or required for disclosure by the Securities and Exchange Commission and applicable state securities or “blue sky” laws, (B) any of the foregoing as may be necessary and/or required in connection with the Chapter 11 Cases, including the approval of the Disclosure Statement and confirmation of the Plan, (C) filings of amended certificates of incorporation or articles of formation or other organizational documents with applicable state authorities, and other registrations, filings, consents, approvals, notices, or other actions that are reasonably necessary to maintain permits, licenses, qualifications, and governmental approvals to carry on the business of the Company, and (D) any other registrations, filings, consents, approvals, notices, or other actions, the failure of which to make, obtain or take, as applicable, would not be reasonably likely, individually or in the aggregate, to materially delay or materially impair the ability of any Party hereto to consummate the transactions contemplated hereby;

(vi)

it (A) is a sophisticated party with respect to the transactions described herein with sufficient knowledge and experience in financial and business matters and is capable of evaluating the merits and risks of the Restructuring, making an informed decision with respect thereto, and evaluating properly the terms and conditions of the Plan and this Agreement, (B) has been represented and advised by legal and financial advisors in connection with this Agreement, (C) has independently and without reliance upon the Consenting Lenders or any officer, employee, agent, or representative thereof, and based on such information as the Company has deemed appropriate, made its own analysis and decision to enter into this Agreement and will not seek rescission or revocation of this Agreement, and (D) acknowledges that it has entered into this Agreement voluntarily and of its own choice and not under coercion or duress;

(vii)

subject to the provisions of sections 1125 and 1126 of the Bankruptcy Code, this Agreement is the legally valid and binding obligation of it, enforceable against it in accordance with its terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium, or other similar laws relating to or limiting creditors’ rights generally, or by equitable principles relating to enforceability; and

(viii)

except as disclosed to the Consenting Lenders and described on Schedule 1 annexed hereto, it has no knowledge of any “Default” or “Event of Default” under the Credit Agreement which has occurred and is continuing.

(a)

To the Company:

(b)

To the address set forth on each Consenting Lender’s signature page (or as directed by any transferee thereof), as the case may be, with a copy (which shall not constitute notice) to:

BORROWER:

EAGLE BULK SHIPPING INC.,

By: 

Name:

Adir Katzav

Title:

Chief Financial Officer

GUARANTORS:

AVOCET SHIPPING LLC

BITTERN SHIPPING LLC

CANARY SHIPPING LLC

CARDINAL SHIPPING LLC

CONDOR SHIPPING LLC

CRANE SHIPPING LLC

CRESTED EAGLE SHIPPING LLC

CROWNED EAGLE SHIPPING LLC

EGRET SHIPPING LLC

FALCON SHIPPING LLC

GANNET SHIPPING LLC

GOLDEN EAGLE SHIPPING LLC

GOLDENEYE SHIPPING LLC

GREBE SHIPPING LLC

HARRIER SHIPPING LLC

HAWK SHIPPING LLC

IBIS SHIPPING LLC

IMPERIAL EAGLE SHIPPING LLC

JAEGER SHIPPING LLC

JAY SHIPPING LLC

KESTREL SHIPPING LLC

KINGFISHER SHIPPING LLC

KITE SHIPPING LLC

KITTIWAKE SHIPPING LLC

MARTIN SHIPPING LLC

MERLIN SHIPPING LLC

NIGHTHAWK SHIPPING LLC

ORIOLE SHIPPING LLC

OSPREY SHIPPING LLC

OWL SHIPPING LLC

PEREGRINE SHIPPING LLC

PETREL SHIPPING LLC

PUFFIN SHIPPING LLC

REDWING SHIPPING LLC

ROADRUNNER SHIPPING LLC

SANDPIPER SHIPPING LLC

SHRIKE SHIPPING LLC

SKUA SHIPPING LLC

SPARROW SHIPPING LLC

STELLAR EAGLE SHIPPING LLC

TERN SHIPPING LLC

THRASHER SHIPPING LLC

THRUSH SHIPPING LLC

WOODSTAR SHIPPING LLC

WREN SHIPPING LLC

GRIFFON SHIPPING LLC

HERON SHIPPING LLC

EAGLE BULK (DELAWARE) LLC

EAGLE SHIPPING INTERNATIONAL

(USA) LLC

By: Eagle Bulk Shipping Inc., its Sole Member

By: 

/s/ Adir Katzav

Name:

Adir Katzav

Title:

Chief Financial Officer

EAGLE MANAGEMENT CONSULTANTS LLC

EAGLE SHIP MANAGEMENT LLC

By: Eagle Shipping International (USA) LLC, its Sole Member

By: Eagle Bulk Shipping Inc., its Sole Member

By: 

/s/ Adir Katzav

Name:

Adir Katzav

Title:  

Chief Financial Officer 

AGALI SHIPPING S.A.

KAMPIA SHIPPING S.A.

MARMARO SHIPPING S.A.

MESTA SHIPPING S.A.

MYLOS SHIPPING S.A.

NAGOS SHIPPING S.A.

RAHI SHIPPING S.A.

SIRIKARI SHIPPING S.A.

SPILIA SHIPPING S.A.

ANEMI MARITIME SERVICES S.A.

By:

/s/ Adir Katzav

Title:

Attorney-In-Fact

EAGLE BULK PTE. LTD.

EAGLE MANAGEMENT CONSULTANCY PTE. LTD.

By:

/s/ Adir Katzav

LENDERS:

OAKTREE HUNTINGTON INVESTMENT FUND, L.P.

By: Oaktree Huntington Investment Fund GP, L.P.

Its: General Partner

By: Oaktree Huntington Investment Fund GP Ltd.

Its: General Partner

By: Oaktree Capital Management, L.P.

Its: Director

By:

/s/ Emily Stephens

Name:

Emily Stephens

Title:

Managing Director

By:

/s/ Mahesh Balakrishnan

Name:

Title:

OAKTREE OPPORTUNITIES FUND VIIIB DELAWARE, L.P.

By: Oaktree Fund GP, LLC

Its: General Partner

By: Oaktree Capital I, L.P.

Its: General Partner

By: OCM Holdings I, LLC

Its: General Partner

\

By: Oaktree Fund GP I, L.P.

Its: Managing Member

By:

/s/ Emily Stephens

Name:

Emily Stephens

Title:

Managing Director

By:

/s/ Mahesh Balakrishnan

Name:

Mahesh Balakrishnan

Title:

Senior Vice President

OAKTREE OPPS IX HOLDCO LTD.

OAKTREE OPPS IX (PARALLEL 2) HOLDCO LTD.

OAKTREE VOF (CAYMAN) 1 CTB LTD.

OAKTREE HUNTINGTON (CAYMAN) 5 CTB LTD.

OAKTREE OPPS VIII (CAYMAN) 3 CTB LTD.

OAKTREE OPPS IX PARALLEL (CAYMAN) 1 CTB LTD.

OAKTREE OPPS IX (CAYMAN) 1 CTB LTD.

OAKTREE OPPS IX PARALLEL 2 (CAYMAN) 1 CTB LTD.

By: Oaktree Capital Management, L.P.

Their: Director

By:

/s/ Emily Stephens

Name:

Emily Stephens

Title:

Managing Director

By:

/s/ Mahesh Balakrishnan

Name:

Mahesh Balakrishnan

Title:

Senior Vice President

OAKTREE VALUE OPPORTUNITIES FUND HOLDINGS, L.P.

By: Oaktree Value Opportunities Fund GP, L.P.

Its: General Partner

By: Oaktree Value Opportunities Fund GP, Ltd.

Its: General Partner

By: Oaktree Capital Management, L.P.

Its: Director

By:

/s/ Emily Stephens

Name:

Emily Stephens

Title:

Managing Director

By:

/s/ Mahesh Balakrishnan

Name:

Mahesh Balakrishnan

Title:

Senior Vice President

CANYON BALANCED MASTER FUND, LTD.

CANYON BLUE CREDIT INVESTMENT FUND L.P.

CANYON DISTRESSED OPPORTUNITY INVESTING FUND, L.P.

CANYON DISTRESSED OPPORTUNITY MASTER FUND, L.P.

CANYON VALUE REALIZATION FUND L.P.

CANYON VALUE REALIZATION MAC 18 LTD.

CANYON-GRF MASTER FUND II, LP

CANYON-TCDRS FUND, LLC

CITI CANYON LTD.

PERMAL CANYON FUND LTD

THE CANYON VALUE REALIZATION MASTER FUND, L.P.

AAI CANYON FUND PLC, an umbrella investment company with variable capital and segregated liability between sub-funds, solely in respect of Canyon Reflection Fund

By: Canyon Capital Advisors LLC

On behalf of the above-referenced funds and accounts

By:

/s/ John P. Plaga

Name:

John P. Plaga

Title:

Authorized Signatory

Please send notices to:

Canyon Partners, LLC

2000 Avenue of the Stars, 11^th Floor

Los Angeles, CA 90067

Attn: Canyon Legal

Facsimile: (310) 272-1371

EMAIL: Legal@canyonpartners.com

MIDTOWN ACQUISITIONS L.P.

By: Midtown Acquisitions GP LLC, its general partner

By:

/s/ Connor Bastable

Name:

Connor Bastable

Title:

Manager

Please send notices to:

Midtown Acquisitions L.P.

65 East 55^th Street, 19^th Floor

New York, NY 10022

Attn: Scott Vogel, Christian Cantalupo

Facsimile: 212-371-4318

EMAIL: svogel@dkpartners.com 

GOLDMAN SACHS LENDING PARTNERS

By:

/s/ Dennis Lafferty

Name:

Dennis Lafferty

Title:

Managing Director

Please send notices to:

Goldman, Sachs & Co.

30 Hudson Street, 5th Floor

Jersey City, NJ 07302

Attn: Michelle Latzoni

Facsimile: 646-769-7700

EMAIL: gs-sbd-admin-contacts@ny.email.gs.com

BRIGADE OPPORTUNISTIC CREDIT FUND 16 LLC

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Title:

CFO

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

BRIGADE OPPORTUNISTIC CREDIT LBG FUND LTD.

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Title:

CFO

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

BIRCH CAPITAL FUND SPC LIMITED –BOND SEGREGATED PORTFOLIO

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Title:

CFO

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

BIG RIVER GROUP FUND SPD LIMITED –BOND SEGREGATED PORTFOLIO

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Title:

CFO

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

BRIGADE CREDIT FUND II LTD.

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Title:

CFO

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

BRIGADE DISTRESSED VALUE MASTER FUND, LTD.

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Title:

CFO

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

BRIGADE LEVERAGED CAPITAL STRUCTURES FUND LTD.

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Title:

CFO

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

BRIGADE OPPORTUNISTIC CREDIT FUND - ICL LP

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Title:

CFO

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

CITIGROUP PENSION PLAN

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

FUTURE DIRECTIONS CREDIT OPPORTUNITIES FUND/BRIGADE

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Title:

CFO

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

FEDEX CORPORATION EMPLOYEES' PENSION TRUST

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Title:

CFO

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

FIRST ENERGY CORP. SYSTEM MASTER RETIREMENT TRUST

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Title:

CFO

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

LOS ANGELES COUNTY EMPLOYEES RETIREMENT ASSOCIATION/BRIGADE

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Title:

CFO

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

OCA BRIGADE CREDIT FUND II LLC

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Title:

CFO

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

RUSSELL INVESTMENT COMPANY

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Title:

CFO

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

TEXAS ABSOLUTE CREDIT OPPORTUNITIES STRATEGY LP

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Title:

CFO

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

TASMAN FUND LP

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Title:

CFO

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

THE COCA-COLA COMPANY MASTER RETIREMENT TRUST

By: Brigade Capital Management, LP, as Investment Manager

By:

/s/ Raymond Luis

Name:

Raymond Luis

Title:

CFO

Please send notices to:

Brigade Capital Management, LP

399 Park Avenue, 16^th Floor

New York, NY 10022

Attn: Jim Keogh

Facsimile: 469-304-2965

EMAIL:14693042965@tls.ldsprod.com

BankDebt@brigadecapital.com

BANK OF AMERICA, N.A., solely on behalf of Global Credit & Special Situations

By:

/s/ Jonathan M Barnes

Name:

Jonathan M Barnes

Title:

Vice President

Please send notices to:

Bank of America, N.A.

214 North Tryon Street

NC1-027-15-01

Charlotte, NC 28255

Attn: Jonathan M Barnes/Credit Info Group

Facsimile: 704-409-0768

EMAIL: jon.barnes@baml.com

Bas.infomanager@bankofamerica.com

* For the avoidance of doubt, Bank of America, N.A. (“BANA”) is executing this Agreement solely in connection with interests which are the record and beneficial ownership of the Global Credit & Special Situations (“GCSS”) business unit and for no other line of business at Bank of America Merrill Lynch, including without limitation, shares held in accounts for which BANA is the investment manager, but not related to the GCSS business unit.

MERRILL LYNCH CREDIT PRODUCTS, LLC, solely on behalf of Global Credit & Special Situations

By:

/s/ Jonathan M Barnes

Name:

Jonathan M Barnes

Title:

Vice President

Please send notices to:

Merrill Lynch Credit Products, LLC

214 North Tryon Street

NC1-027-15-01

Charlotte, NC 28255

Attn: Jonathan M Barnes/Credit Info Group

Facsimile: 704-409-0768

EMAIL: jon.barnes@baml.com

Bas.infomanager@bankofamerica.com

* For the avoidance of doubt, Merrill Lynch Credit Products, LLC (“MLCP”) is executing this Agreement solely in connection with interests which are the record and beneficial ownership of the Global Credit & Special Situations (“GCSS”) business unit and for no other line of business at Bank of America Merrill Lynch.

BLUEBAY ASSET MANAGEMENT LLP, acting as agent for BlueBay Funds Management Company S.A. acting for and on behalf of BlueBay Specialised Funds: Global Unconstrained High Yield (Master) Fund

BLUEBAY ASSET MANAGEMENT LLP, acting as agent for BlueBay Global Monthly Income Bond Fund

BLUEBAY ASSET MANAGEMENT LLP, acting as agent for BlueBay COF Loan Investments S.A.

BLUEBAY ASSET MANAGEMENT LLP, acting as agent for BlueBay Global Unconstrained High Yield Investments (Luxembourg) S.à.r.l

BLUEBAY ASSET MANAGEMENT LLP, acting as agent for BlueBay European Distressed Opportunities Investments (Luxembourg) S.à.r.l

By:

/s/ Timothy Horan

Name:

Timothy Horan

Title:

Credit Analyst

PANNING MASTER FUND, LP

By: Panning Capital Management, LP, its investment manager

By:

/s/ Kieran Goodwin

Name:

Kieran Goodwin

Title:

Authorized Signatory

Please send notices to:

Panning Master Fund, LP

510 Madison Ave., 24^th Fl

New York, NY 10022

Attn: Robert Bowers

Facsimile: 212-916-1861

EMAIL: Robert@panning.com

OCP INVESTMENT TRUST

By: Onex Credit Partners, LLC, its manager

By:

/s/ Kevin Connors

Name:

Kevin Connors

Title:

Portfolio Manager

Please send notices to:

notifications@onexcredit.com

Attn: Andrew Walker

Facsimile: 201-541-2611

EMAIL: notifications@onexcredit.com

ONEX DEBT OPPORTUNITY FUND, LTD.

By: Onex Credit Partners, LLC, its investment manager

By:

/s/ Kevin Connors

Name:

Kevin Connors

Title:

Portfolio Manager

Please send notices to:

notifications@onexcredit.com

Attn: Andrew Walker

Facsimile: 201-541-2611

EMAIL: notifications@onexcredit.com

OVERVIEW

Parties

Eagle and all of its direct and indirect subsidiaries.

Those certain lenders under the Fourth Amended and Restated Credit Agreement, dated as of June 20, 2012, by and among Eagle, as borrower, the financial institutions listed therein, as original lenders, the subsidiaries of Eagle listed therein, as original guarantors, The Royal Bank of Scotland plc (“RBS”), as original Agent and Security Trustee (as amended from time to time, the “Credit Agreement”), holding the Term Loans¹ and the PIK Loans in an amount sufficient to consummate the transactions set forth herein under the terms of the Credit Agreement (collectively, the “Consenting Lenders”), and Wilmington Trust (London) Limited (“Wilmington”), as successor Agent and Security Trustee under the Credit Agreement.

Economic Terms of Restructuring

The principal economic terms of the Restructuring shall consist of the following:

i.     The Loans (and any Amended Lender Warrant Shares (defined below)) shall be exchanged for (a) cash, on a pro rata basis, in an amount up to the amount of any New Debt (as defined below) less (1) the amount of any Outstanding Trade Obligations (defined below) and (2) any amount necessary to fully fund a working capital reserve equal to the Minimum Liquidity Amount (defined below) upon consummation of the Restructuring following payment of the Restructuring Expenses (defined below) (such cash payment to the Lenders, the “Lender Cash Distribution”) and (b) new shares, on a pro rata basis, of Common Stock that will provide the Lenders with 99.5% of the total outstanding Common Stock of the Company after such issuance (the “Lender Shares Issuance”), subject to dilution by the Management Incentive Plan and the Equity Warrants (as such terms are described below).

ii.    The Company shall incur senior secured indebtedness in an amount up to forty percent (40%) of the appraised value of the fleet with a new, third-party senior secured credit facility (the “New Debt”), which shall be on market terms and conditions, which terms and conditions shall be acceptable to the Company and the Consenting Lenders.

iii.    Holders of unsecured claims shall be paid in full, provided that no material unsecured claims exist except as incurred in the ordinary course of business or as specifically identified herein; provided, further, that subject to the consent of the Majority Consenting Lenders,² up to $12 million in unsecured obligations of the Company (whether a direct obligation of Eagle or any of its direct or indirect subsidiaries) outstanding on the effective date of the Restructuring shall be paid from the proceeds of the New Debt (the “Outstanding Trade Obligations”).

iv.    The Management Incentive Plan (as described below) shall be implemented.

v.    Current holders of Common Stock (other than Consenting Lenders who hold Amended Lender Warrants or Amended Lender Warrant Shares) shall receive or retain (as applicable), on a pro rata basis, (a) shares equal to 0.5% of the total outstanding Common Stock of the Company after the Lender Shares Issuance, subject to dilution by the Management Incentive Plan and the Equity Warrants, and (b) warrants (the “Equity Warrants”) providing the right to acquire 7.5% of the Common Stock at an exercise price equal to the face amount of the principal of the Loans outstanding immediately prior to the consummation of the Restructuring (this assumes all accrued interest will be paid in cash).³ The Equity Warrants shall expire seven (7) years after the effective date of the Restructuring. Customary terms for public company warrants to be agreed.

“Amended Lender Warrant Shares” as that term is used herein means the shares issued on account of an exercise of the Amended Lender Warrants.

“Amended Lender Warrants” as that term is used herein means the Warrants issued in respect of “Exercise Commencement Date B” and “Exercise Commencement Date C” (each, as denoted on Schedule 1 to the Warrant Agreement), as such warrants were amended pursuant to that certain Amendment No. 1 to Warrant Agreement, dated as of July 2, 2014, by and between Eagle and the majority holders of the Warrants.

IMPLEMENTATION OF THE RESTRUCTURING

Restructuring Support Agreement

The Company and the Consenting Lenders shall execute a restructuring support agreement (the “RSA”) with standard terms and conditions evidencing their intent to support consummation of the Restructuring.

Prepackaged Plan of Reorganization and Chapter 11 Case

The Restructuring shall be implemented pursuant to a prepackaged chapter 11 plan of reorganization for (the “Plan”) and a voluntary case commenced by Eagle and, if necessary, one or more of Eagle’s direct or indirect subsidiaries (the “Chapter 11 Case(s)”) under chapter 11 of title 11 of the United States Code, 11 U.S.C. §§ 101–1532 (as amended, the “Bankruptcy Code”) in the United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”).

GENERAL TERMS OF THE RESTRUCTURING

New Liquidity Facility; Application of New Debt Proceeds

The Company may enter into a new revolving credit facility for working capital purposes (the “New Liquidity Facility”) in the principal amount of up to $50 million. The New Liquidity Facility may be provided by third party financing sources, and the Consenting Lenders shall have no obligation to provide such financing.

If the Company is unable to implement the New Liquidity Facility in connection with the consummation of the Restructuring, then the Lender Cash Distribution will be adjusted accordingly to fully fund a working capital reserve equal to the Minimum Liquidity Amount upon consummation of the Restructuring following payment of any Outstanding Trade Obligations and the Restructuring Expenses.

For the avoidance of doubt, (a) the minimum liquidity reserve (inclusive of any minimum liquidity requirements under the New Debt) based on the cash on hand and borrowing availability under the New Liquidity Facility, if applicable, immediately following the consummation of the Restructuring (including, but not limited to, following payment of or allocation for the Lender Cash Distribution, the Outstanding Trade Obligations, and the Restructuring Expenses) shall be no less than $72.5 million (the “Minimum Liquidity Amount”) and (b) any proceeds of the New Debt shall first be applied towards the payment in full of (i) the Outstanding Trade Obligations and (ii) any amount necessary to satisfy the Minimum Liquidity Amount following payment of the fees and expenses incurred in connection with the Restructuring, as well as the funding obligations under the Plan (the “Restructuring Expenses”).⁴

Management Incentive Plan

As part of the Restructuring, Eagle shall institute a new management incentive plan reserving certain Common Stock of Reorganized Eagle as follows, which plan will supersede any prior management or employee stock compensation plan of Eagle and any of its affiliates and subsidiaries (the “New Management Incentive Plan”). Upon completion of the Restructuring, senior management and certain other employees of the Company will:

(a)   receive, pursuant to the vesting schedule described below, 2.0% of the Common Stock outstanding as of the effective date of the Restructuring on a fully-diluted basis (the “MIP Shares”); and

(b)  be issued the following incentive awards (the “MIP Options”) from the New Management Incentive Plan based on different levels of appreciation above Eagle’s reorganization enterprise value (as determined by a bankruptcy court) (the “Reorganization Enterprise Value”) as follows: (i) seven (7) year stock options to acquire 2.5% of Common Stock based on the Reorganization Equity Value (defined below); and (ii) seven (7) year stock options to acquire 3.0% of Common Stock based on a premium to the Reorganization Equity Value equivalent to a 30.2% premium to the Reorganization Enterprise Value. For the avoidance of doubt, the amount of the premium referenced in the foregoing clause (ii) would be calculated by dividing (a) the amount in dollars that is equal to 30.2% of the Reorganization Enterprise Value into (b) the dollar amount of the Reorganized Equity Value.  Such premium would then be applied to the Reorganization Equity Value to derive the applicable strike price on the tranche of warrants in the foregoing clause (ii).  “Reorganization Equity Value” as used herein means, on the effective date of the Restructuring, the Reorganization Enterprise Value less the New Debt incurred.⁴

The MIP Shares and the MIP Options will generally vest over four (4) years through annual installments, each in an amount equal to 25% of such shares or options, as applicable, commencing on the first anniversary of the Restructuring.

In addition, no less than 2.5% of the shares of Common Stock of Reorganized Eagle (on a fully diluted basis), subject to upward adjustment as may be agreed to by Eagle and the Majority Consenting Lenders prior to the effective date of the Restructuring, will be reserved for future issuances by Reorganized Eagle to senior management and certain other employees of Reorganized Eagle at the direction of the Reorganized Eagle’s Board of Directors.

The Company’s Chief Executive Officer shall receive not less than 60% of the total compensation to be awarded under the Management Incentive Plan. Other terms with respect to the MIP Shares and the MIP Options for the Company’s Chief Executive Officer shall be determined in connection with the employment agreement, and applicable award agreements, as set forth on Exhibit A.

Participants in the Management Incentive Plan will be entitled to the Minority Shareholder Protections discussed below.

The Management Incentive Plan will be structured as an omnibus incentive plan and will contain provisions consistent with this Term Sheet and other provisions, including without limitation adjustment provisions to reflect any transaction involving company shares, including as a result of dividends, recapitalization, stock split, etc., so as to prevent any diminution or enlargement of the holder’s rights under the award.   In addition, awards that expire or are forfeited or cancelled will again be available for issuance under the Management Incentive Plan and awards may not be materially amended in an adverse manner without the consent of any holder who is senior management. The MIP Shares will have the right to receive dividends or other distributions at the same time and in the same form as a holder of Common Stock; provided that (i) dividends or other distributions in respect of unvested MIP Shares will be paid at the same time as underlying MIP Shares are settled and (ii) provided further than the MIP Shares will not receive a dividend from the proceeds of the New Debt if the New Debt is incurred after closing. The senior management will also have the right to elect a net settlement (i.e., on a cashless basis) with respect to both the MIP Shares and the MIP Options.

Releases

The Plan shall provide for customary mutual releases and/or waivers, including standard carveouts, among the Company, each of the Consenting Lenders, RBS, as original Agent and Security Trustee under the Credit Agreement, Wilmington, as successor Agent and Security Trustee under the Credit Agreement, and each of their respective directors, officers, funds, affiliates, members, employees, partners, managers, agents, representatives, principals, consultants, and professional advisors (each in their capacity as such) (collectively, the “Released Parties”) of any and all claims, obligations (contractual or otherwise), suits, judgments, damages, rights, liabilities, or causes of action, whether known or unknown, foreseen or unforeseen, relating to any actions, transactions, events, or omissions before the effective date of the Restructuring in any way relating to the Company, the obligations under the Credit Agreement, or the Restructuring, that a Released Party would have been legally entitled to assert in their own right or on behalf of another party (including, for the avoidance of doubt, the Company) against another Released Party.

Employment Agreements

Upon and following any consummation of the Restructuring, the Employment Agreement between Eagle, Eagle Shipping International (USA) LLC, a Marshall Islands Company, and Sophocles Zoullas, dated June 19, 2008 (as amended, modified or restated from time to time, the “Zoullas Employment Agreement”) shall be amended as set forth on Exhibit A.

Board of Directors

The Board of Directors shall consist of seven (7) members, one of whom shall be Eagle’s Chief Executive Officer (Sophocles Zoullas), who also shall serve as Chairman of the Board. The remaining six (6) directors shall be selected by the Majority Consenting Lenders in their sole discretion; provided that the Consenting Lenders shall consult in good faith with management and the independent board committee concerning the individuals selected; provided, further, that sufficient independent directors will be selected to comply with any applicable listing requirements. The Board may appoint a non-executive, independent lead director with responsibilities customary for an independent lead director.

Senior Officers

The senior officers (“Senior Officers”) of the Company shall be:

Chief Executive Officer:

●  Sophocles Zoullas

Chief Financial Officer:

●  Adir Katzav

President of Eagle Shipping International (USA) LLC:

●  Alexis Zoullas

Amended Articles & Bylaws

The Company’s existing articles and bylaws will be subject to customary amendments and modifications and shall include certain rights and protections for minority shareholders customary for a listed public company (collectively, the “Minority Shareholder Protections”) as well as the maximum protections available with respect to affiliate transactions for public companies, including any merger, consolidation or reorganization of the Company, any sale, transfer or other disposition of all or substantially all of the assets of the Company, any other change in control of the Company or all or substantially all of its assets involving an affiliate (any such transactions, “Material Transactions”).

Registration Rights

The Company and the Consenting Lenders shall negotiate in good faith a registration rights agreement providing for (1) the right of shareholders requiring registration rights to require the Company to register with the SEC shares of Common Stock and Equity Warrants and shares of Common Stock underlying Equity Warrants, in each case issued to them pursuant to the Restructuring, and (2) “piggy-back” registration rights with customary cutbacks for such shareholders.

Public Status

Eagle shall remain a public company and shall file reports under the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

Listing Status

Eagle shall remain listed on the Nasdaq Global Select Market.  To ensure Eagle’s continued listing, the Consenting Lenders shall provide Eagle with sufficient time and cooperation to take the necessary steps to comply with all applicable Nasdaq requirements, as shall be reasonably agreed between the parties. In the event that Eagle loses its Nasdaq listing for any reason prior to the consummation of the Restructuring, (i) the Consenting Lenders agree to support Eagle’s good faith efforts to become relisted on Nasdaq and (ii) Eagle shall use commercially reasonable efforts to comply with listing requirements while delisted, subject to the terms and conditions of the Restructuring.

Fees & Expenses / Expense Reimbursement

The Company shall pay the fees and expenses incurred by the following advisors to the Consenting Lenders and Wilmington, as successor Agent and Security Trustee under the Credit Agreement, acting jointly: (i) Paul, Weiss, Rifkind, Wharton & Garrison LLP (“Paul Weiss”) as set forth in that certain fee letter, dated as of January 1, 2014, between Eagle and Paul Weiss; (ii) Houlihan Lokey Capital, Inc.  (“Houlihan”) as set forth in that certain letter agreement, dated as of February 1, 2014, among Eagle, Houlihan, Paul Weiss, and the Lender Group (as defined therein), and (iii) maritime and appropriate foreign counsel engaged by Paul Weiss.

Right to Solicit Alternative Restructurings

Notwithstanding anything to the contrary herein, the Company shall not be entitled to solicit, encourage, and initiate any offer or proposal from, enter into any agreement with, or engage in any discussions or negotiations with, any person or entity concerning any actual or proposed transaction involving any or all of (i) another financial and/or corporate restructuring of any member of the Company, (ii) the issuance, sale, or other disposition of any equity or debt interests, or any material assets, of any member of the Company, or (iii) a merger, consolidation, business combination, liquidation, recapitalization, refinancing, or similar transaction involving any member of the Company (each, an “Alternative Transaction”); provided, however, that the Company may respond to any proposal or offer for an Alternative Transaction to the extent that the Board of Directors of the Company determines in good faith, and consistent with its fiduciary duties, that such a response is necessary; provided, further, however, that the Company shall promptly provide copies of all such documentations and materials received by the Company concerning such an Alternative Transaction to Paul Weiss.

Tax, Securities, and Corporate Matters

The issuance of shares and the transactions discussed herein are subject to ongoing tax diligence, securities compliance, and other corporate review.

Insurance

All insurance premiums on existing policies shall be paid as of the effective date of the closing of the Restructuring or when earlier due. On or before the closing of the Restructuring, the Company shall obtain reasonably sufficient tail coverage (i.e., D&O insurance coverage that extends beyond the end of the policy period through the end of any applicable statute of limitations period) under a directors’ and officers’ liability insurance policy for the Company’s current and former directors, officers, and managers.

Delphin Management Agreement

The Company shall use its best efforts to amend the Management Agreement between Eagle Bulk and Delphin Shipping LLC on terms and conditions acceptable to the Company and the Consenting Lenders, provided that if the parties are unable to do so, the Company, at the direction of the Consenting Lenders, shall take reasonably necessary steps to not renew the management agreement.

If the Delphin management agreement is not amended as set forth herein, it will be rejected in the Chapter 11 Case; provided that the foregoing terms and requirements with respect to the Delphin management agreement may be waived by the Company and the Consenting Lenders.

Other Terms and Conditions

The Plan, the definitive documentation and other material agreements shall be in form and substance satisfactory to the Consenting Lenders and shall contain such other terms and conditions as are customary for transactions of this type.

Provision

Current Agreement Description

Title/Position

Executive shall serve as the Chief Executive Officer of the Company and the Executive shall continue to serve as the Chairman; provided that the Board may add a position of a non-executive, independent lead director or may elect to separate the positions of Chief Executive Officer and Chairman, and neither action will constitute Good Reason.

Term

Current term to end on June 18, 2017, subject to automatic 1 year extensions on each anniversary thereof, unless either party provides 90 days’ advance written.

Non-renewal is to be treated the same as a termination by the Company without Cause/by the Executive for Good Reason.

Provision 

Current Agreement Description

Duties

During the Term, Executive shall devote substantially all of his business time and attention to the business and affairs of the Company and the Parent and use his reasonable best efforts to faithfully perform his duties and responsibilities; but notwithstanding the foregoing, nothing in the Agreement shall preclude the Executive (i) from engaging, consistent with his duties and responsibilities hereunder, in charitable, educational and community affairs, including serving on the board of directors of any charitable, educational or community organization, (ii) from managing his personal passive investments, (iii) upon approval of the Board, which approval shall not be unreasonably withheld, from serving as a director of another company; (iv) from engaging in activities approved by the Board and (v) from managing his investment in Delphin Shipping LLC, provided that such management does not materially interfere with the Executive’s duties with the Company. The Executive agrees not to take personal advantage of any business opportunities relating to general shipping which may arise during the Executive’s employment hereunder which could reasonably be expected to be business opportunities that the Company or the Parent might pursue.

The following language will be clarified to provide that Executive will not have any majority ownership interest or active day-to-day management role in any opportunity that the Board elects not to participate in:

“The Executive further agrees to disclose all such opportunities, and the material facts attendant thereto, to the Board for consideration by the Company and the Parent. If within 15 business days of the Executive disclosing such business opportunities to the Board, the Board fails to adopt a resolution (and to provide a copy of same to the Executive) that it may pursue such business opportunity, the Company and the Parent will be deemed to have declined to pursue such opportunity, in which event the Executive shall be free to pursue it.”

Base Salary and Annual Cash Bonus Opportunity

$850,000 base salary per annum. 

Base Salary shall be reviewed for increase at such time, and in the same manner as the salaries of senior officers of the Company are reviewed generally.

For first two years of contract term, the Executive will be eligible for a target annual cash bonus opportunity equal to 50% of base salary with a maximum annual cash bonus opportunity of 75% base salary.

Performance goals to be set by Compensation committee following reasonable consultation with Executive.

Equity Vesting on Termination: Death/Disability

One year additional vesting in equity-based awards; provided that, in all cases, no less than two years of total vesting.

Current Agreement Description

Termination by the Company w/o Cause or by Executive with Good Reason

●     Accrued Obligations;

●     Severance equal to 2X the sum of Executive’s Base Salary plus bonus (for purposes of this calculation, bonus is to be equal to (i) 62.5% of Base Salary if such separation occurs during the first two years following the effective date of the Agreement and (ii) 100% of Base Salary thereafter) payable in a lump sum within 60 days following the termination;

●     Continued medical and life insurance benefits for two years, subject to Executive’s continued payment of required contributions as if an active employee; and

●     One year additional vesting in equity-based awards; provided that, in all cases, no less than two years of total vesting.

Termination by the Company w/o Cause or by Executive with Good Reason within 2 years following a Change in Control

No enhanced severance upon a termination following a Change in Control. The 2x severance will apply if there is a termination following a Change in Control.

280G Golden Parachute

280G best-net provision.

Clawback

Clawback provision shall be inserted, applicable to the extent required by applicable law (including without limitation Section 304 of the Sarbanes Oxley Act and Section 954 of the Dodd Frank Act).

Non-Competition and
Non-Solicitation

Non-compete and non-solicit (employees and customers): During the Term and for one year post termination for any reason.

Competitive Activity definition to be read as follows:

“Competitive Activity” means involvement in the management or operation of or control, direct or indirect, of a company that operates vessels, of which at least 80% (by number of ships) are dry bulk vessels, wherever such business is located in the world if such business is or reasonably could become a competitor of the Company at the time the Executive becomes affiliated with such company.

Indemnification

Subject to the Executive’s review of final language, indemnification provision to be updated to provide for a carve-out that no indemnification will be provided for any claims initiated by the Executive against the Company, the Board or its officers and directors unless approved in advance in writing by the Board.

Language to be consistent for all senior executive officers and directors.

- and –

Tyson M. Lomazow

Matthew Brod

MILBANK, TWEED, HADLEY & M^CCLOY LLP

One Chase Manhattan Plaza

New York, NY 10005

(212) 530-5000

)

In re:

)

Chapter 11

)

EAGLE BULK SHIPPING INC. 

)

Case No. 14-                    (     )

)

Debtor.

)

)

)

NO CHAPTER 11 CASE HAS BEEN COMMENCED AT THIS TIME. THE SOLICITATION MATERIALS ACCOMPANYING THIS PREPACKAGED PLAN OF REORGANIZATION HAVE NOT BEEN APPROVED BY THE COURT. FOLLOWING THE COMMENCEMENT OF THE CHAPTER 11 CASE, THE DEBTOR EXPECTS TO PROMPTLY SEEK ENTRY OF AN ORDER SCHEDULING A COMBINED HEARING ON THE ADEQUACY OF THE DISCLOSURE STATEMENT AND SOLICITATION PROCEDURES AND CONFIRMATION OF THE PLAN.

Dated:

August 6, 2014
New York, New York

INTRODUCTION

ARTICLE I. DEFINITIONS AND CONSTRUCTION OF TERMS  

A.

Definitions.

1

B.

Interpretation, Application of Definitions, and Rules of Construction.

14

C.

Computation of Time.

15

ARTICLE II. ADMINISTRATIVE Claims, DIP Claims, and PRIORITY CLAIMS  

A.

Administrative Claims (Other Than Fee Claims).

15

B.

DIP Claims.

15

C.

Fee Claims.

16

D.

Priority Tax Claims.

16

E.

U.S. Trustee Fees.

17

ARTICLE III. CLASSIFICATION AND TREATMENT OF CLAIMS AND EQUITY INTERESTS  

A.

Classification of Claims and Equity Interests.

17

B.

Record Date.

17

C.

Summary of Classification and Class Identification.

18

D.

Treatment of Classified Claims and Equity Interests.

18

E.

Special Provision Regarding Unimpaired and Reinstated Claims.

21

ARTICLE IV. MEANS FOR IMPLEMENTATION OF THE PLAN  

A.

General Settlement of Claims and Interests.

21

B.

Exit Financing.

22

C.

Voting of Claims.

22

D.

Nonconsensual Confirmation.

22

E.

Issuance of New Eagle Common Stock and New Eagle Equity Warrants and Entry into the Registration Rights Agreement.

22

F.

The New Eagle Equity Warrants.

24

G.

Continued Corporate Existence and Vesting of Assets.

25

H.

Fee Claims Escrow Account.

25

I.

Claims Against Non-Debtor Subsidiaries.

26

J.

Subsidiary Equity Interests.

26

ARTICLE V. PROVISIONS REGARDING CORPORATE GOVERNANCE OF THE REORGANIZED DEBTOR  

A.

Organizational Documents.

26

B.

Appointment of Officers and Directors.

26

C.

Powers of Officers.

27

D.

New CEO Employment Agreement, Existing Benefits Agreements, and Retiree Benefits.

27

E.

Management Incentive Program.

27

F.

Indemnification of Directors, Officers, and Employees.

28

ARTICLE VI. CONFIRMATION OF THE PLAN  

A.

Conditions to Confirmation.

28

B.

Waiver of Conditions Precedent to Confirmation.

29

C.

Discharge of the Debtor.

29

D.

Injunction.

29

E.

Preservation of Causes of Action.

31

F.

Votes Solicited in Good Faith.

32

G.

Prepetition Credit Facility Agent and Consenting Lenders’ Fees and Expenses.

32

H.

Cancellation of Certain Indebtedness, Agreements, and Existing Securities.

32

I.

Claims Incurred After the Effective Date.

33

J.

Releases, Exculpations, and Injunctions of Released Parties.

33

K.

Preservation of Insurance.

36

ARTICLE VII. DISTRIBUTIONS UNDER THE PLAN  

A.

Procedures for Treating Disputed Claims.

36

B.

Allowed Claims and Equity Interests.

37

C.

Allocation of Consideration.

39

D.

Estimation.

40

E.

Insured Claims.

40

ARTICLE VIII. RETENTION OF JURISDICTION  

ARTICLE IX. EXECUTORY CONTRACTS AND UNEXPIRED LEASES  

A.

Assumption of Executory Contracts and Unexpired Leases.

42

B.

Cure Claims.

43

C.

Reservation of Rights.

44

D.

Rejection of Executory Contracts and Unexpired Leases.

44

E.

Assignment.

45

F.

Insurance Policies.

45

G.

Post-Petition Contracts and Leases.

45

ARTICLE X. EFFECTIVENESS OF THE PLAN  

A.

Conditions Precedent to Effectiveness.

45

B.

Waiver of Conditions Precedent to Effectiveness.

46

C.

Effect of Failure of Conditions.

46

D.

Vacatur of Confirmation Order.

46

E.

Modification of the Plan.

47

F.

Revocation, Withdrawal, or Non-Consummation.

47

ARTICLE XI. MISCELLANEOUS PROVISIONS  

A.

Immediate Binding Effect.

47

B.

Governing Law.

48

C.

Filing or Execution of Additional Documents.

48

D.

Term of Injunctions or Stays.

48

E.

Withholding and Reporting Requirements.

48

F.

Exemption From Transfer Taxes.

48

G.

Plan Supplement.

49

H.

Notices.

49

I.

Conflicts.

50

A.

Definitions.