ARIAS, FABREGA & FABREGA acted as special Panamanian counsel to Zephyr Overseas Inc., in connection with the first preferred naval mortgage over the drilling unit of Panamanian registry SSV Atlantic Zephyr, in favor of Deutsche Bank Trust Company Americas, in his capacity as offshore collateral agent and security trustee.

The first preferred naval mortgage was granted by Zephyr Overseas Inc., as security for the obligations of Carolina Marine Inc., in connection with a US$ 720 million secured term loan facility, and certain hedging agreements of up to US$250 million, to inter alia, finance the construction of the drilling unit Carolina, to be registered under the Liberian registry.

Roy C. Durling Jr., partner and head of the firm's Shipping and Transportation practice group, and associate Pilar Castillo, participated in this transaction.