November 9, 2004

Mary Linn
Vice President of Finance
Ocean Carriers

Re: 180,000 DWT Vessel Proposal

Dear Mary:

Our analysis of the proposal for the construction of a new 180,000 DWT vessel has brought us to the conclusion that the project should not be undertaken. Our recommendation and decision is based on a discounted cash flow analysis of expected future cash flows from the vessel that produced a net loss for the project of $7,201,639. Included in this recommendation are a number of important assumptions, each of which is described in detail below, that we believe are neither conservative nor aggressive in nature. A sensitivity analysis of major assumptions in our analysis is included on the final page of this memo. In each viable case, we arrived at the same conclusion to not undertake this project.

Client Contract Proposal and Timing
This project arose as a result of an attractive offer presented by a client. The client offer is for what we estimate to be a......

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Title: Ocean Carriers Project Analysis
Approximate Word Count: 1409
Approximate Pages: 6 (250 words per double-spaced page)

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