Exhibit 4.1


 


EXECUTION COPY


 


 


SHAREHOLDERS RIGHTS AGREEMENT


 


by and between


 


SAFE BULKERS, INC.


 


and


 


AMERICAN STOCK TRANSFER & TRUST
COMPANY


 


Dated as of August 5, 2020


 




    	 		 



    	



    



TABLE OF CONTENTS


 


Page


 


	Section 1. Certain Definitions	 	1
	Section 3. Issuance of Rights Certificates	 	8
	Section 4. Form of Rights Certificates	 	11
	Section 5. Countersignature and Registration	 	12
	Section 6. Transfer, Split Up, Combination and Exchange of Rights Certificates; Mutilated, Destroyed, Lost or Stolen Rights Certificates	 	12
	Section 7. Exercise of Rights; Exercise Price; Expiration Date of Rights	 	13
	Section 8. Cancellation and Destruction of Rights Certificates	 	15
	Section 9. Reservation and Availability of Preferred Shares	 	15
	Section 10. Record Date	 	16
	Section 11. Adjustment of Exercise Price, Number of Shares or Number of Rights	 	16
	Section 12. Certificate of Adjusted Exercise Price or Number of Shares	 	22
	Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power	 	23
	Section 14. Fractional Rights and Fractional Shares	 	26
	Section 15. Rights of Action	 	27
	Section 16. Agreement of Rights Holders	 	28
	Section 17. Rights Certificate Holder Not Deemed a Shareholder	 	28
	Section 18. The Rights Agent	 	28
	Section 19. Merger or Consolidation or Change of Name of Rights Agent	 	29
	Section 20. Duties of Rights Agent	 	30
	Section 21. Change of Rights Agent	 	32
	Section 22. Issuance of New Rights Certificates	 	32
	Section 23. Redemption	 	33
	Section 24. Exchange	 	33
	Section 25. Notice of Certain Events	 	35
	Section 26. Notices	 	35
	Section 27. Supplements and Amendments	 	36
	Section 28. Successors	 	37
	Section 29. Determinations and Actions by the Board of Directors, etc	 	37
	Section 30. Benefits of this Agreement	 	37
	Section 31. Severability	 	37
	Section 32. Governing Law	 	37
	Section 33. Counterparts	 	37
	Section 34. Descriptive Headings	 	38




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SHAREHOLDERS RIGHTS AGREEMENT


 


This Shareholders Rights
Agreement (this “Agreement”) is made and entered into as of August 5, 2020, by and between Safe Bulkers, Inc.,
a Marshall Islands corporation (the “Company”), and American Stock Transfer & Trust Company, as Rights
Agent (the “Rights Agent”).


 


WHEREAS, the Board of
Directors of the Company (the “Board”) has (a) authorized and declared a grant of one right (the “Right”)
for each share of the Company’s common stock, par value U.S. $0.001 per share (the “Common Stock”), held
of record as of the Close of Business (as hereinafter defined) on the date specified by the Board as the Record Date (the “Record
Date”) and (b) has further authorized the issuance of one Right in respect of each share of Common Stock that shall become
outstanding (i) at any time between the Record Date and the earliest of the Distribution Date, the Redemption Date or the Final
Expiration Date (as such terms are hereinafter defined) or (ii) upon the exercise or conversion, prior to the earlier of the Redemption
Date or the Final Expiration Date, of any option or other security exercisable for or convertible into shares of Common Stock,
which option or other such security is outstanding on the Distribution Date; and


 


WHEREAS, each Right
represents the right of the holder thereof to purchase one one-thousandth of a share of Series A Participating Preferred Stock
(as such number may hereafter be adjusted pursuant to the provisions hereof), upon the terms and subject to the conditions set
forth herein, having the rights, preferences and privileges set forth in the Statement of Designation of Series A Participating
Preferred Stock, attached hereto as Exhibit A.


 


NOW THEREFORE, in consideration
of the premises and the mutual agreements set forth herein, the parties hereby agrees as follows:


 


Section 1. Certain
Definitions.


 


“Acquiring
Person” shall mean any Person who or which, together with all Affiliates and Associates of such Person, shall be the
Beneficial Owner of 10% or more of the shares of Common Stock then outstanding, but shall not include (i) the Company, (ii) any
Subsidiary of the Company, (iii) any employee benefit plan of the Company or of any Subsidiary of the Company, or any entity holding
shares of Common Stock for or pursuant to the terms of any such plan or (iv) an Exempted Person. Notwithstanding the foregoing,
no Person shall be deemed to be an Acquiring Person as the result of an acquisition of shares of Common Stock by the Company which,
by reducing the number of shares outstanding, increases the proportionate number of shares beneficially owned by such Person to
10% or more of the shares of Common Stock of the Company then outstanding; provided, however, that a Person
who (i) becomes the Beneficial Owner of 10% or more of the shares of Common Stock of the Company then outstanding by reason of
share purchases by the Company and (ii) then after such share purchases by the Company, becomes the Beneficial Owner of any additional
shares of Common Stock of the Company (other than pursuant to a dividend or distribution paid or made by the Company on the outstanding
shares of Common Stock in shares of Common Stock or pursuant to a split or subdivision of the outstanding shares of Common Stock)
representing one percent or more of the



    	 		 



    	



    

Common Stock then outstanding,
such Person shall be deemed to be an Acquiring Person unless upon becoming the Beneficial Owner of such additional shares of Common
Stock of the Company such Person does not beneficially own 10% or more of the shares of Common Stock of the Company then outstanding.
Notwithstanding the foregoing, (i) if the Board determines in good faith that a Person who would otherwise be an “Acquiring
Person,” as defined herein, has become such inadvertently (including, without limitation, because (A) such Person was unaware
that it beneficially owned a percentage of the shares of Common Stock that would otherwise cause such Person to be an “Acquiring
Person,” as defined herein, or (B) such Person was aware of the extent of the shares of Common Stock it beneficially owned
but had no actual knowledge of the consequences of such beneficial ownership under this Agreement) and without any intention of
changing or influencing control of the Company, and if such Person divested or divests as promptly as practicable a sufficient
number of shares of Common Stock so that such Person would no longer be an “Acquiring Person,” as defined herein, then
such Person shall not be deemed to be or to have become an “Acquiring Person” for any purposes of this Agreement;
and (ii) if, as of the time of the public announcement of this Agreement, any Person is the Beneficial Owner of 10% or more of
the shares of Common Stock outstanding, such Person shall not be or become an “Acquiring Person,” as defined herein,
unless and until such time as such Person shall become the Beneficial Owner of additional shares of Common Stock (other than pursuant
to a dividend or distribution paid or made by the Company on the outstanding shares of Common Stock in shares of Common Stock or
pursuant to a split or subdivision of the outstanding shares of Common Stock), unless, upon becoming the Beneficial Owner of such
additional shares of Common Stock, such Person is not then the Beneficial Owner of 10% or more of the shares of Common Stock then
outstanding.


 


Notwithstanding the
foregoing, if a bona fide swaps dealer who would otherwise be an “Acquiring Person” has become so as a result
of its actions in the ordinary course of its business that the Board determines, in its sole discretion, were taken without the
intent or effect of evading or assisting any other Person to evade the purposes and intent of this Agreement, or otherwise seeking
to control or influence the management or policies of the Company, then, and unless and until the Board shall otherwise determine,
such Person shall not be deemed to be an “Acquiring Person” for any purposes of this Agreement.


 


“Adjustment
Fraction” shall have the meaning set forth in Section 11(a)(i) hereof.


 


“Affiliate”
and “Associate” shall have the respective meanings ascribed to such terms in Rule 12b-2 of the General Rules
and Regulations under the Exchange Act, as in effect on the date of this Agreement.


 


A Person shall be deemed
the “Beneficial Owner” of and shall be deemed to “Beneficially Own” any securities:


 


(i)     which
such Person or any of such Person’s Affiliates or Associates beneficially owns, directly or indirectly, for purposes of Section
13(d) of the Exchange Act and Rule 13d-3 thereunder (or any comparable or successor law or regulation);


 


(ii)     which
such Person or any of such Person’s Affiliates or Associates has (A) the right to acquire (whether such right is exercisable
immediately or only



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after the passage
of time) pursuant to any agreement, arrangement or understanding (other than customary agreements with and between underwriters
and selling group members with respect to a bona fide public offering of securities), or upon the exercise of conversion rights,
exchange rights, rights (other than the Rights), warrants or options, or otherwise; provided, however, that
a Person shall not be deemed pursuant to this subsection (ii)(A) to be the Beneficial Owner of, or to beneficially own, (1) securities
tendered pursuant to a tender or exchange offer made by or on behalf of such Person or any of such Person’s Affiliates or
Associates until such tendered securities are accepted for purchase or exchange, or (2) securities which a Person or any of such
Person’s Affiliates or Associates may be deemed to have the right to acquire pursuant to any merger or other acquisition
agreement between the Company and such Person (or one or more of its Affiliates or Associates) if such agreement has been approved
by the Board prior to there being an Acquiring Person; or (B) the right to vote pursuant to any agreement, arrangement or
understanding; provided, however, that a Person shall not be deemed the Beneficial Owner of, or to beneficially
own, any security under this subsection (ii)(B) if the agreement, arrangement or understanding to vote such security (1) arises
solely from a revocable proxy or consent given to such Person in response to a public proxy or consent solicitation made pursuant
to, and in accordance with, the applicable rules and regulations of the Exchange Act and (2) is not also then reportable on Schedule
13D under the Exchange Act (or any comparable or successor report);


 


(iii)     which
are beneficially owned, directly or indirectly, by any other Person (or any Affiliate or Associate thereof) with which such Person
or any of such Person’s Affiliates or Associates has (x) any agreement, arrangement or understanding, whether or not in writing
(other than customary agreements with and between underwriters and selling group members with respect to a bona fide public offering
of securities) for the purpose of acquiring, holding, voting or disposing of any securities of the Company (except to the extent
contemplated by the proviso to subsection (ii)(B) above) or (y) any agreement, arrangement or understanding, whether or not in
writing, to cooperate in obtaining, changing or influencing control of the Company (except to the extent contemplated by the proviso
to subsection (ii)(B) above); provided, however, that in no case shall an officer or director of the Company
be deemed (I) the Beneficial Owner of any securities beneficially owned by another officer or director of the Company solely by
reason of actions undertaken by such persons in their capacity as officers or directors of the Company or (II) the Beneficial Owner
of securities held of record by the trustee of any employee benefit plan of the Company or any Subsidiary of the Company for the
benefit of any employee of the Company or any Subsidiary of the Company, other than the officer or director, by reason of any influence
that such officer or director may have over the voting of the securities held in the plan; or


 


(iv)     which
are the subject of or the reference securities for, that underlie, or which are Beneficially Owned, directly or indirectly, by
a Counterparty (or any of such Counterparty’s Affiliates or Associates) under, any Derivatives Contract (without regard to
any short or similar position under the same or any other



    	 	-3-	 



    	



    

Derivatives
Contract) to which such Person or any of such Person’s Affiliates or Associates is a Receiving Party (as such terms are defined
in the definition of “Derivatives Contract”), with the number of securities Beneficially Owned being the notional or
other number of securities specified in the documentation evidencing such Derivatives Contract as being subject to be acquired
upon the exercise or settlement of such Derivatives Contract or as the basis upon which the value or settlement amount of such
Derivatives Contract is to be calculated in whole or in part or, if no such number of securities is specified in such documentation,
as determined by the Board in its sole discretion to be the number of securities to which such Derivatives Contract relates; provided,
however, that the number of shares of Common Stock that a Person is deemed to Beneficially Own pursuant to this clause (iv)
in connection with a particular Derivatives Contract shall not exceed the number of Notional Common Shares with respect to such
Derivatives Contract; provided, further, that the number of securities beneficially owned by each Counterparty (including
its Affiliates and Associates) under a Derivatives Contract shall for purposes of this clause (iv) be deemed to include all securities
that are beneficially owned, directly or indirectly, by any other Counterparty (or any of such other Counterparty’s Affiliates
or Associates) under any Derivatives Contract to which such first Counterparty (or any of such first Counterparty’s Affiliates
or Associates) is a Receiving Party, with this proviso being applied to successive Counterparties as appropriate.


 


Notwithstanding anything
in this definition of Beneficial Ownership to the contrary, the phrase “then outstanding,” when used with reference
to a Person’s Beneficial Ownership of securities of the Company, shall mean the number of such securities then issued and
outstanding together with the number of such securities not then actually issued and outstanding which are issuable by the Company
and which such Person would be deemed to Beneficially Own hereunder.


 


“Business Day”
shall mean any day other than a Saturday, Sunday or a day on which banking institutions in New York are authorized or obligated
by law or executive order to close.


 


“Close of Business”
on any given date shall mean 5:00 P.M., New York time, on such date; provided, however, that if such date is
not a Business Day it shall mean 5:00 P.M., New York time, on the next succeeding Business Day.


 


“Common Stock”
shall have the meaning set forth in the preamble. Common Stock when used with reference to any Person other than the Company shall
mean the capital stock (or equity interest) with the greatest voting power of such other Person or, if such other Person is a Subsidiary
of another Person, the Person or Persons which ultimately control such first-mentioned Person.


 


“Common Stock
Equivalents” shall have the meaning set forth in Section 11(a)(iii) hereof.



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“Company”
shall have the meaning set forth in the preamble, subject to the terms of Section 13(a)(iii)(c) hereof.


 


“Counterparty”
shall have the meaning set forth in the definition of Derivatives Contract.


 


“Current Per
Share Market Price” of any security (a “Security” for purposes of this definition), for all computations
other than those made pursuant to Section 11(a)(iii) hereof, shall mean the average of the daily closing prices per share of such
Security for the thirty (30) consecutive Trading Days immediately prior to such date, and for purposes of computations made pursuant
to Section 11(a)(iii) hereof, the Current Per Share Market Price of any Security on any date shall be deemed to be the average
of the daily closing prices per share of such Security for the ten (10) consecutive Trading Days immediately prior to such date;
provided, however, that in the event that the Current Per Share Market Price of the Security is determined during
a period following the announcement by the issuer of such Security of (i) a dividend or distribution on such Security payable in
shares of such Security or securities convertible into such shares or (ii) any subdivision, combination or reclassification of
such Security, and prior to the expiration of the applicable thirty (30) Trading Day or ten (10) Trading Day period, after the
ex dividend date for such dividend or distribution, or the record date for such subdivision, combination or reclassification, then,
and in each such case, the Current Per Share Market Price shall be appropriately adjusted to reflect the current market price per
share equivalent of such Security. The closing price for each day shall be the last sale price, regular way, or, in case no such
sale takes place on such day, the average of the closing bid and asked prices, regular way, in either case as reported in the principal
consolidated transaction reporting system with respect to securities listed or admitted to trading on the New York Stock Exchange
or, if the Security is not listed or admitted to trading on the New York Stock Exchange, as reported in the principal consolidated
transaction reporting system with respect to securities listed on the principal national securities exchange on which the Security
is listed or admitted to trading or, if the Security is not listed or admitted to trading on any national securities exchange,
the last sale price or, if such last sale price is not reported, the average of the high bid and low asked prices in the over-the-counter
market, as reported by Nasdaq or such other system then in use, or, if on any such date the Security is not quoted by any such
organization, the average of the closing bid and asked prices as furnished by a professional market maker making a market in the
Security selected by the Board of Directors of the Company. If on any such date no market maker is making a market in the Security,
the fair value of such shares on such date as determined in good faith by the Board of Directors of the Company shall be used.
If the Preferred Shares are not publicly traded, the Current Per Share Market Price of the Preferred Shares shall be conclusively
deemed to be the Current Per Share Market Price of the shares of Common Stock as determined pursuant to this definition, as appropriately
adjusted to reflect any stock split, stock dividend or similar transaction occurring after the date hereof, multiplied by 1,000.
If the Security is not publicly held or so listed or traded, Current Per Share Market Price shall mean the fair value per share
as determined in good faith by the Board of Directors of the Company, whose determination shall be described in a statement filed
with the Rights Agent and shall be conclusive for all purposes.


 


“Current Value”
shall have the meaning set forth in Section 11(a)(iii) hereof.



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“Derivatives
Contract” shall mean a contract between two parties (the “Receiving Party” and the “Counterparty”)
that is designed to produce economic benefits and risks to the Receiving Party that correspond substantially to the ownership by
the Receiving Party of a number of shares of Common Stock specified or referenced in such contract (the number corresponding to
such economic benefits and risks, the “Notional Common Shares”), regardless of whether obligations under such contract
are required or permitted to be settled through the delivery of cash, Common Stock or other property, without regard to any short
position under the same or any other Derivatives Contract. For the avoidance of doubt, interests in broad-based index options,
broad-based index futures and broad-based publicly traded market baskets of stocks approved for trading by the appropriate federal
governmental authority shall not be deemed to be Derivatives Contracts.


 


“Distribution
Date” shall mean the earlier of (i) the Close of Business on the tenth day after the Shares Acquisition Date (or, in
the event the Board determines on or before such tenth day to effect an exchange in accordance with Section 24 hereof and determines
that a later date is advisable, such later date) (or, if the tenth day after the Shares Acquisition Date occurs before the Record
Date, the Close of Business on the Record Date) or (ii) the Close of Business on the tenth Business Day (or such later date as
may be determined by action of the Board) after the date that a tender or exchange offer by any Person (other than the Company,
any Subsidiary of the Company, any employee benefit plan of the Company or of any Subsidiary of the Company, or any Person or entity
organized, appointed or established by the Company for or pursuant to the terms of any such plan or an Exempted Person) is first
published or sent or given within the meaning of Rule 14d-2(a) of the General Rules and Regulations under the Exchange Act, if,
assuming the successful consummation thereof, such Person would be an Acquiring Person.


 


“Equivalent
Shares” shall mean Preferred Shares and any other class or series of capital stock of the Company which is entitled to
the same rights, privileges and preferences as the Preferred Shares.


 


“Exchange Act”
shall mean the U.S. Securities Exchange Act of 1934, as amended.


 


“Exchange Ratio”
shall have the meaning set forth in Section 24(a) hereof.


 


“Exempted Person”
shall mean each member of the Hajioannou Group and any Underwriter.


 


“Exercise Price”
shall have the meaning set forth in Section 4(a) hereof.


 


“Expiration
Date” shall mean the earliest to occur of: (i) the Close of Business on the Final Expiration Date, (ii) the Redemption
Date, or (iii) the time at which the Rights are exchanged as provided in Section 24 hereof.


 


“Final Expiration
Date” shall mean August 5, 2030.


 


“Hajioannou
Group” shall mean Vorini Holdings Inc., Machairiotissa Holdings Inc., Safety Management Overseas S.A., Safe Bulkers Management
Limited., Mr. Polys Hajioannou, Mr. Nicolaos Hadjioannou, any other trusts or entities established for the benefit of Mr. Polys
Hajioannou or Mr. Nicolaos Hadjioannou or members of their respective families, any other entities wholly owned or any entity controlled
by, or under common control with, any of the



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above, Mr. Polys Hajioannou
or Mr. Nicolaos Hadjioannou and members of their respective families, and each of their respective Affiliates and Associates.


 


“Nasdaq”
shall mean the National Association of Securities Dealers, Inc. Automated Quotations System.


 


“Notional Common
Shares” has the meaning given in the definition of Derivatives Contract.


 


“Person”
shall mean any individual, firm, corporation or other entity, and shall include any successor (by merger or otherwise) of such
entity.


 


“Post-event
Transferee” shall have the meaning set forth in Section 7(e) hereof.


 


“Preferred
Shares” shall mean shares of Series A Participating Preferred Stock, U.S. $0.01 par value, of the Company.


 


“Pre-event
Transferee” shall have the meaning set forth in Section 7(e) hereof.


 


“Principal
Party” shall have the meaning set forth in Section 13(b) hereof.


 


“Record Date”
shall have the meaning set forth in the recitals at the beginning of this Rights Agreement.


 


“Redemption
Date” shall have the meaning set forth in Section 23(a) hereof.


 


“Redemption
Price” shall have the meaning set forth in Section 23(a) hereof.


 


“Rights Agent”
shall mean American Stock Transfer & Trust Company, or its successor or replacement as provided in Sections 19 and 21
hereof.


 


“Rights Certificate”
shall mean a certificate substantially in the form attached hereto as Exhibit B.


 


“Section 11(a)(ii)
Trigger Date” shall have the meaning set forth in Section 11(a)(iii) hereof.


 


“Section 13
Event” shall mean any event described in clause (i), (ii) or (iii) of Section 13(a) hereof.


 


“Securities
Act” shall mean the U.S. Securities Act of 1933, as amended.


 


“Shares
Acquisition Date” shall mean the first date of public announcement (which, for purposes of this definition, shall
include, without limitation, a report filed pursuant to Section 13(d) under the Exchange Act) by the Company or an Acquiring
Person that an Acquiring Person has become such, or such earlier date as the Board shall become aware of the existence of an
Acquiring Person; provided that, if such Person is determined not to have become an Acquiring Person as defined
herein, then no Shares Acquisition Date shall be deemed to have occurred.



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“Spread”
shall have the meaning set forth in Section 11(a)(iii) hereof.


 


“Subsidiary”
of any Person shall mean any corporation or other entity of which an amount of voting securities sufficient to elect a majority
of the directors or Persons having similar authority of such corporation or other entity is beneficially owned, directly or indirectly,
by such Person, or any corporation or other entity otherwise controlled by such Person.


 


“Substitution
Period” shall have the meaning set forth in Section 11(a)(iii) hereof.


 


“Summary of
Rights” shall mean a summary of this Agreement substantially in the form attached hereto as Exhibit C.


 


“Total Exercise
Price” shall have the meaning set forth in Section 4(a) hereof.


 


“Trading Day”
shall mean a day on which the principal national securities exchange on which a referenced security is listed or admitted to trading
is open for the transaction of business or, if a referenced security is not listed or admitted to trading on any national securities
exchange, a Business Day.


 


A “Triggering
Event” shall be deemed to have occurred upon any Person becoming an Acquiring Person.


 


“Underwriter”
shall mean any financial institution while acting as an underwriter in a public offering of the Common Stock of the Company.


 


Section 2. Appointment
of Rights Agent. The Company hereby appoints the Rights Agent to act as agent for the Company and the holders of the Rights
(who, in accordance with Section 3 hereof, shall prior to the Distribution Date also be the holders of the shares of Common Stock)
in accordance with the terms and conditions hereof, and the Rights Agent hereby accepts such appointment. The Company may from
time to time appoint such co Rights Agents as it may deem necessary or desirable.


 


Section 3. Issuance
of Rights Certificates.


 


(a)     Until
the Distribution Date, (i) the Rights will be evidenced (subject to the provisions of Sections 3(b) and 3(c) hereof) by the certificates
for shares of Common Stock registered in the names of the holders thereof (which certificates shall also be deemed to be Rights
Certificates) and not by separate Rights Certificates, and Rights associated with any uncertificated shares of Common Stock shall
be evidenced (subject to Section 3(b) hereof) by the registration of such shares in the Company’s stock ledger in the names
of the holders thereof (which registration shall also be deemed to be registration of the Rights Certificates) and not by separate
Rights Certificates, and (ii) the right to receive Rights Certificates will be transferable only in connection with the transfer
of shares of Common Stock. Until the earlier of the Distribution Date or the Expiration Date, the surrender for transfer of certificates
for shares of Common Stock (or uncertificated shares of Common Stock) shall also constitute the surrender for transfer of the Rights
associated with the shares of Common Stock represented thereby. As soon as practicable after the Distribution Date, the Company
will prepare and execute, the Rights Agent will countersign, and the Company will send or cause to be sent (and the Rights Agent
will, if requested,



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send) by first-class,
postage prepaid mail, to each record holder of shares of Common Stock as of the Close of Business on the Distribution Date, at
the address of such holder shown on the records of the Company, a Rights Certificate evidencing one Right for each share of Common
Stock so held, subject to adjustment as provided herein. In the event that an adjustment in the number of Rights per share of Common
Stock has been made pursuant to Section 11 hereof, then at the time of distribution of the Rights Certificates, the Company shall
make the necessary and appropriate rounding adjustments (in accordance with Section 14(a) hereof) so that Rights Certificates representing
only whole numbers of Rights are distributed and cash is paid in lieu of any fractional Rights. As of the Distribution Date, the
Rights will be evidenced solely by such Rights Certificates and may be transferred by the transfer of the Rights Certificates as
permitted hereby, separately and apart from any transfer of shares of Common Stock, and the holders of such Rights Certificates
as listed in the records of the Company or any transfer agent or registrar for the Rights shall be the record holders thereof.


 


(b)     On
the Record Date or as soon as practicable thereafter, the Company will send a copy of the Summary of Rights by first- class, postage-prepaid
mail, to each record holder of shares of Common Stock as of the Close of Business on the Record Date that requests a Summary of
Rights, at the address of such holder shown on the records of the Company’s transfer agent and registrar. With respect to
certificates for shares of Common Stock outstanding as of the Record Date, until the Distribution Date, the Rights will be evidenced
by such certificates registered in the names of the holders thereof together with the Summary of Rights. With respect to uncertificated
shares of Common Stock outstanding as of the Close of Business on the Record Date, until the Distribution Date, the Rights shall
be evidenced by the registration of such Common Stock in the Company’s stock ledger in the names of the holders thereof and
such registered holders shall also be the registered holders of the associated Rights. Until the Distribution Date (or, if earlier,
the Expiration Date), the surrender for transfer of any certificate for shares of Common Stock outstanding on the Record Date,
with or without a copy of the Summary of Rights, shall also constitute the transfer of the Rights associated with the shares of
Common Stock represented thereby and the registration of transfer of ownership of any uncertificated shares of Common Stock in
respect of which Rights have been issued shall also constitute the transfer of Rights associated with the Common Stock the ownership
of which is so transferred.


 


(c)     Unless
the Board of Directors by resolution adopted at or before the time of the issuance of any shares of Common Stock specifies to the
contrary, Rights shall be issued in respect of all shares of Common Stock that are issued after the Record Date but prior to the
earlier of the Distribution Date or the Expiration Date or, in certain circumstances provided in Section 22 hereof, after the Distribution
Date. Certificates representing such shares of Common Stock shall also be deemed to be certificates for Rights, and shall bear
the following legend:


 


THIS CERTIFICATE ALSO EVIDENCES AND
ENTITLES THE HOLDER HEREOF TO CERTAIN RIGHTS AS SET FORTH IN A SHAREHOLDERS RIGHTS AGREEMENT BETWEEN SAFE BULKERS, INC. AND AMERICAN
STOCK TRANSFER & TRUST COMPANY, AS THE RIGHTS AGENT (THE “RIGHTS AGREEMENT”), THE TERMS OF WHICH ARE HEREBY
INCORPORATED HEREIN BY REFERENCE AND A COPY OF WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE OFFICES OF SAFE BULKERS, INC. UNDER
CERTAIN CIRCUMSTANCES, AS SET 



    	 	-9-	 



    	



    

FORTH IN THE RIGHTS AGREEMENT, SUCH
RIGHTS WILL BE EVIDENCED BY SEPARATE CERTIFICATES AND WILL NO LONGER BE EVIDENCED BY THIS CERTIFICATE. SAFE BULKERS, INC. WILL
MAIL TO THE HOLDER OF THIS CERTIFICATE A COPY OF THE RIGHTS AGREEMENT WITHOUT CHARGE AFTER RECEIPT OF A WRITTEN REQUEST THEREFOR.
UNDER CERTAIN CIRCUMSTANCES SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS ISSUED TO, OR HELD BY, ANY PERSON WHO IS, WAS OR BECOMES
AN ACQUIRING PERSON OR ANY AFFILIATE OR ASSOCIATE THEREOF (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT), WHETHER CURRENTLY
HELD BY OR ON BEHALF OF SUCH PERSON OR BY ANY SUBSEQUENT HOLDER, MAY BECOME NULL AND VOID.


 


In the case of the initial
transaction statement or subsequent periodic statements with respect to uncertificated shares of Common Stock, such statements
shall bear the following legend (or a substantially similar legend to the same effect):


 


THE REGISTRATION IN THE STOCK LEDGER
OF SAFE BULKERS, INC. OF THE SHARES OF COMMON STOCK TO WHICH THIS INITIAL TRANSACTION OR SUBSEQUENT PERIODIC STATEMENT RELATES
ALSO EVIDENCES AND ENTITLES THE REGISTERED HOLDER OF SUCH SHARES TO CERTAIN RIGHTS AS SET FORTH IN THE RIGHTS AGREEMENT BETWEEN
SAFE BULKERS, INC. AND AMERICAN STOCK TRANSFER & TRUST COMPANY, AS THE RIGHTS AGENT (THE “RIGHTS AGREEMENT”),
THE TERMS OF WHICH ARE HEREBY INCORPORATED HEREIN BY REFERENCE AND A COPY OF WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE OFFICES
OF SAFE BULKERS, INC. UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT, SUCH RIGHTS WILL BE EVIDENCED BY SEPARATE
CERTIFICATES AND WILL NO LONGER BE EVIDENCED BY SUCH REGISTRATION. SAFE BULKERS, INC. WILL MAIL TO THE REGISTERED HOLDER OF SUCH
SHARES A COPY OF THE AGREEMENT WITHOUT CHARGE AFTER RECEIPT OF A WRITTEN REQUEST THEREFOR. UNDER CERTAIN CIRCUMSTANCES, AS SET
FORTH IN THE RIGHTS AGREEMENT, RIGHTS ISSUED TO ANY PERSON WHO IS, WAS OR BECOMES AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE
OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT), WHETHER CURRENTLY HELD BY OR ON BEHALF OF SUCH PERSON
OR BY ANY SUBSEQUENT HOLDER, MAY BECOME NULL AND VOID.


 


With respect to such
certificates containing the foregoing legend, until the Distribution Date, the Rights associated with the shares of Common Stock
represented by such certificates shall be evidenced by such certificates alone, and the surrender for transfer of any such certificate
shall also constitute the transfer of the Rights associated with the shares of Common



    	 	-10-	 



    	



    

Stock represented thereby.
With respect to such initial transaction statement or subsequent periodic statements containing the foregoing legend, until the
Distribution Date, the Rights associated with such shares of Common Stock with respect to which such statements are issued shall
be evidenced solely by the registration of ownership of such shares in the stock ledger of the Company, and the registration of
transfer of ownership in such stock ledger shall also constitute the transfer of the Rights associated with such shares, the ownership
of which is so transferred.


 


(d)     In
the event that the Company purchases or acquires any shares of Common Stock after the Record Date but prior to the Distribution
Date, any Rights associated with such shares of Common Stock shall be deemed canceled and retired so that the Company shall not
be entitled to exercise any Rights associated with the shares of Common Stock which are no longer outstanding.


 


Section 4. Form
of Rights Certificates.


 


(a)     The
Rights Certificates (and the forms of election to purchase shares of Common Stock and of assignment to be printed on the reverse
thereof) shall be substantially in the form of Exhibit B hereto and may have such marks of identification or designation and such
legends, summaries or endorsements printed thereon as the Company may deem appropriate and as are not inconsistent with the provisions
of this Agreement, or as may be required to comply with any applicable law or with any rule or regulation made pursuant thereto
or with any rule or regulation of any stock exchange or a national market system, on which the Rights may from time to time be
listed or included, or to conform to usage. Subject to the provisions of Section 11 and Section 22 hereof, the Rights Certificates,
whenever distributed, shall be dated as of the Record Date (or in the case of Rights issued with respect to shares of Common Stock
issued by the Company after the Record Date, as of the date of issuance of such shares of Common Stock) and on their face shall
entitle the holders thereof to purchase such number of one-thousandths of a Preferred Share as shall be set forth therein at the
price set forth therein (such exercise price per one one-thousandth of a Preferred Share being hereinafter referred to as the “Exercise
Price” and the aggregate Exercise Price of all Preferred Shares issuable upon exercise of one Right being hereinafter referred
to as the “Total Exercise Price”), but the number and type of securities purchasable upon the exercise of each
Right and the Exercise Price shall be subject to adjustment as provided herein.


 


(b)     Any
Rights Certificate issued pursuant to Section 3(a) or Section 22 hereof that represents Rights beneficially owned by: (i) an Acquiring
Person or any Associate or Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring Person (or of any such Associate
or Affiliate) who becomes a transferee after the Acquiring Person becomes such or (iii) a transferee of an Acquiring Person (or
of any such Associate or Affiliate) who becomes a transferee prior to or concurrently with the Acquiring Person becoming such and
receives such Rights pursuant to either (A) a transfer (whether or not for consideration) from the Acquiring Person to holders
of equity interests in such Acquiring Person or to any Person with whom such Acquiring Person has any continuing agreement, arrangement
or understanding regarding the transferred Rights or (B) a transfer which the Board has determined is part of a plan, arrangement
or understanding which has as a primary purpose or effect avoidance of Section 7(e) hereof, and any Rights Certificate issued pursuant
to Section 6 or Section 11 hereof upon transfer, exchange, replacement or adjustment of



    	 	-11-	 



    	



    

any other Rights Certificate
referred to in this sentence, shall contain (to the extent feasible) the following legend:


 


THE RIGHTS REPRESENTED BY THIS RIGHTS
CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE OF AN
ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT). ACCORDINGLY, THIS RIGHTS CERTIFICATE AND THE RIGHTS REPRESENTED
HEREBY MAY BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF THE RIGHTS AGREEMENT.


 


Section 5. Countersignature
and Registration.


 


(a)     The
Rights Certificates shall be executed on behalf of the Company by its Chief Executive Officer, its Chief Operating Officer, its
Chief Financial Officer, its President or any Vice President, either manually or by facsimile signature, and by the Secretary or
an Assistant Secretary of the Company, either manually or by facsimile signature, and shall have affixed thereto the Company’s
seal (if any) or a facsimile thereof. The Rights Certificates shall be manually countersigned by the Rights Agent and shall not
be valid for any purpose unless countersigned. In case any officer of the Company who shall have signed any of the Rights Certificates
shall cease to be such officer of the Company before countersignature by the Rights Agent and issuance and delivery by the Company,
such Rights Certificates, nevertheless, may be countersigned by the Rights Agent and issued and delivered by the Company with the
same force and effect as though the person who signed such Rights Certificates on behalf of the Company had not ceased to be such
officer of the Company; and any Rights Certificate may be signed on behalf of the Company by any person who, at the actual
date of the execution of such Rights Certificate, shall be a proper officer of the Company to sign such Rights Certificate, although
at the date of the execution of this Rights Agreement any such person was not such an officer.


 


(b)     Following
the Distribution Date, the Rights Agent will keep or cause to be kept, at its office designated for such purposes, books for registration
and transfer of the Rights Certificates issued hereunder. Such books shall show the names and addresses of the respective holders
of the Rights Certificates, the number of Rights evidenced on its face by each of the Rights Certificates and the date of each
of the Rights Certificates.


 


Section 6. Transfer,
Split Up, Combination and Exchange of Rights Certificates; Mutilated, Destroyed, Lost or Stolen Rights Certificates.


 


(a)     Subject
to the provisions of Sections 7(e), 14 and 24 hereof, at any time after the Close of Business on the Distribution Date, and at
or prior to the Close of Business on the Expiration Date, any Rights Certificate or Rights Certificates may be transferred, split
up, combined or exchanged for another Rights Certificate or Rights Certificates, entitling the registered holder to purchase a
like number of one-thousandths of a Preferred Share (or, following a Triggering Event, other securities, cash or other assets,
as the case may be) as the Rights Certificate or Rights Certificates surrendered then entitled such holder to purchase. Any registered
holder desiring to transfer, split up, combine or exchange any Rights Certificate or Rights



    	 	-12-	 



    	



    

Certificates shall make
such request in writing delivered to the Rights Agent, and shall surrender the Rights Certificate or Rights Certificates to be
transferred, split up, combined or exchanged at the office of the Rights Agent designated for such purpose. Neither the Rights
Agent nor the Company shall be obligated to take any action whatsoever with respect to the transfer of any such surrendered Rights
Certificate until the registered holder shall have completed and signed the certificate contained in the form of assignment on
the reverse side of such Rights Certificate and shall have provided such additional evidence of the identity of the Beneficial
Owner (or former Beneficial Owner) or Affiliates or Associates thereof as the Company shall reasonably request. Thereupon the Rights
Agent shall, subject to Sections 7(e), 14 and 24 hereof, countersign and deliver to the person entitled thereto a Rights Certificate
or Rights Certificates, as the case may be, as so requested. The Company may require payment of a sum sufficient to cover any tax
or governmental charge that may be imposed in connection with any transfer, split up, combination or exchange of Rights Certificates.


 


(b)     Upon
receipt by the Company and the Rights Agent of evidence reasonably satisfactory to them of the loss, theft, destruction or mutilation
of a Rights Certificate, and, in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to them,
and, at the Company’s request, reimbursement to the Company and the Rights Agent of all reasonable expenses incidental thereto,
and upon surrender to the Rights Agent and cancellation of the Rights Certificate if mutilated, the Company will make and deliver
a new Rights Certificate of like tenor to the Rights Agent for delivery to the registered holder in lieu of the Rights Certificate
so lost, stolen, destroyed or mutilated.


 


Notwithstanding any
of the provisions hereof, the Company and the Rights Agent may amend this Rights Agreement to provide for uncertificated Rights
in addition to or in place of Rights evidenced by Rights Certificates.


 


Section 7. Exercise
of Rights; Exercise Price; Expiration Date of Rights.


 


(a)     Subject
to Sections 7(e), 23(b) and 24(b) hereof, the registered holder of any Rights Certificate may exercise the Rights evidenced thereby
(except as otherwise provided herein) in whole or in part at any time after the Distribution Date and prior to the Close of Business
on the Expiration Date by surrender of the Rights Certificate, with the form of election to purchase on the reverse side thereof
duly executed, to the Rights Agent at the office of the Rights Agent designated for such purpose, together with payment of the
Exercise Price for each one-thousandth of a Preferred Share (or, following a Triggering Event, other securities, cash or other
assets as the case may be) as to which the Rights are exercised.


 


(b)     The
Exercise Price for each one-thousandth of a Preferred Share issuable pursuant to the exercise of a Right shall initially be Five
Dollars and Twenty Cents (U.S. $5.20), shall be subject to adjustment from time to time as provided in Sections 11 and 13 hereof
and shall be payable in lawful money of the United States of America in accordance with paragraph (c) below.


 


(c)     Upon
receipt of a Rights Certificate representing exercisable Rights, with the form of election to purchase duly executed, accompanied
by payment of the Exercise Price for the number of one-thousandths of a Preferred Share (or, following a Triggering Event, other



    	 	-13-	 



    	



    


securities, cash or other
assets as the case may be) to be purchased and an amount equal to any applicable transfer tax required to be paid by the holder
of such Rights Certificate in accordance with Section 9(c) hereof, the Rights Agent shall, subject to Section 20(k) hereof,
thereupon promptly (i) (A) requisition from any transfer agent of the Preferred Shares (or make available, if the Rights
Agent is the transfer agent for the Preferred Shares) a certificate or certificates for the number of one- thousandths of a Preferred
Share (or, following a Triggering Event, other securities, cash or other assets as the case may be) to be purchased and the Company
hereby irrevocably authorizes its transfer agent to comply with all such requests or (B) if the Company shall have elected
to deposit the total number of one-thousandths of a Preferred Share (or, following a Triggering Event, other securities, cash or
other assets as the case may be) issuable upon exercise of the Rights hereunder with a depositary agent, requisition from the depositary
agent depositary receipts representing such number of one-thousandths of a Preferred Share (or, following a Triggering Event, other
securities, cash or other assets as the case may be) as are to be purchased (in which case certificates for the Preferred Shares
(or, following a Triggering Event, other securities, cash or other assets as the case may be) represented by such receipts shall
be deposited by the transfer agent with the depositary agent) and the Company hereby directs the depositary agent to comply with
such request, (ii) when appropriate, requisition from the Company the amount of cash to be paid in lieu of issuance of fractional
shares in accordance with Section 14 hereof, (iii) after receipt of such certificates or depositary receipts, cause the
same to be delivered to or upon the order of the registered holder of such Rights Certificate, registered in such name or names
as may be designated by such holder and (iv) when appropriate, after receipt thereof, deliver such cash to or upon the order
of the registered holder of such Rights Certificate. The payment of the Exercise Price (as such amount may be reduced (including
to zero) pursuant to Section 11(a)(iii) hereof) and an amount equal to any applicable transfer tax required to be paid by
the holder of such Rights Certificate in accordance with Section 9(c) hereof, may be made in cash or by certified bank check,
cashier’s check or bank draft payable to the order of the Company. In the event that the Company is obligated to issue securities
of the Company other than Preferred Shares, pay cash and/or distribute other property pursuant to Section 11(a) hereof, the
Company will make all arrangements necessary so that such other securities, cash and/or other property are available for distribution
by the Rights Agent, if and when appropriate.


 


(d)       In
case the registered holder of any Rights Certificate shall exercise less than all the Rights evidenced thereby, a new Rights Certificate
evidencing Rights equivalent to the Rights remaining unexercised shall be issued by the Rights Agent to the registered holder of
such Rights Certificate or to his or her duly authorized assigns, subject to the provisions of Section 14 hereof.


 


(e)       Notwithstanding
anything in this Agreement to the contrary, from and after the first occurrence of a Triggering Event, any Rights beneficially
owned by (i) an Acquiring Person or an Associate or Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring
Person (or of any such Associate or Affiliate) who becomes a transferee after the Acquiring Person becomes such (a “Post-Event
Transferee”), (iii) a transferee of an Acquiring Person (or of any such Associate or Affiliate) who becomes a transferee
prior to or concurrently with the Acquiring Person becoming such and receives such Rights pursuant to either (A) a transfer
(whether or not for consideration) from the Acquiring Person to holders of equity interests in such Acquiring Person or to any
Person with whom the Acquiring Person has any continuing agreement, arrangement or understanding regarding the transferred Rights
or (B) a transfer which the Board



    	 	 -14-	 



    	



    

has determined is part
of a plan, arrangement or understanding which has as a primary purpose or effect the avoidance of this Section 7(e) (a “Pre-Event
Transferee”) or (iv) any subsequent transferee receiving transferred Rights from a Post-Event Transferee or a Pre-Event
Transferee, either directly or through one or more intermediate transferees, shall become null and void without any further action
and no holder of such Rights shall have any rights whatsoever with respect to such Rights, whether under any provision of this
Agreement or otherwise. The Company shall use all reasonable efforts to ensure that the provisions of this Section 7(e) and
Section 4(b) hereof are complied with, but shall have no liability to any holder of Rights Certificates or to any other Person
as a result of its failure to make any determinations with respect to an Acquiring Person or any of such Acquiring Person’s
Affiliates, Associates or transferees hereunder.


 


(f)       Notwithstanding
anything in this Agreement to the contrary, (i) the Rights shall not become exercisable pursuant to any provision of this
Agreement prior to the Distribution Date and (ii) neither the Rights Agent nor the Company shall be obligated to undertake
any action with respect to a registered holder upon the occurrence of any purported exercise as set forth in this Section 7
unless such registered holder shall, in addition to having complied with the requirements of Section 7(a), have (x) completed
and signed the certificate contained in the form of election to purchase set forth on the reverse side of the Rights Certificate
surrendered for such exercise and (y) provided such additional evidence of the identity of the Beneficial Owner (or former
Beneficial Owner) or Affiliates or Associates thereof as the Company shall reasonably request.


 


Section 8. Cancellation
and Destruction of Rights Certificates. All Rights Certificates surrendered for the purpose of exercise, transfer, split
up, combination or exchange shall, if surrendered to the Company or to any of its agents, be delivered to the Rights Agent for
cancellation or in canceled form, or, if surrendered to the Rights Agent, shall be canceled by it, and no Rights Certificates shall
be issued in lieu thereof except as expressly permitted by any of the provisions of this Agreement. The Company shall deliver to
the Rights Agent for cancellation and retirement, and the Rights Agent shall so cancel and retire, any Rights Certificate purchased
or acquired by the Company otherwise than upon the exercise thereof. The Rights Agent shall deliver all canceled Rights Certificates
to the Company, or shall, at the written request of the Company, destroy such canceled Rights Certificates, and in such case shall
deliver a certificate of destruction thereof to the Company.


 


Section 9. Reservation
and Availability of Preferred Shares.


 


(a)       The
Company covenants and agrees that it will use its best efforts to cause to be reserved and kept available out of its authorized
and unissued Preferred Shares not reserved for another purpose, the number of Preferred Shares that will be sufficient to permit
the exercise in full of all outstanding Rights.


 


(b)       The
Company covenants and agrees that it will take all such action as may be necessary to ensure that all Preferred Shares (or other
securities of the Company) delivered upon exercise of Rights shall, at the time of delivery of the certificates for such securities
(subject to payment of the Exercise Price), be duly and validly authorized and issued and fully paid and nonassessable shares.



    	 	 -15-	 



    	



    

(c)       The
Company further covenants and agrees that it will pay when due and payable any and all federal and state transfer taxes and charges
which may be payable in respect of the original issuance or delivery of the Rights Certificates or of any Preferred Shares (or
other securities of the Company) upon the exercise of Rights. The Company shall not, however, be required to pay any transfer tax
which may be payable in respect of any transfer or delivery of Rights Certificates to a person other than, or the issuance or delivery
of certificates or depositary receipts for the Preferred Shares (or other securities of the Company) in a name other than that
of, the registered holder of the Rights Certificate evidencing Rights surrendered for exercise or to issue or to deliver any certificates
or depositary receipts for Preferred Shares (or other securities of the Company) upon the exercise of any Rights until any such
tax shall have been paid (any such tax being payable by the holder of such Rights Certificate at the time of surrender) or until
it has been established to the Company’s satisfaction that no such tax is due.


 


Section 10. Record
Date. Each Person in whose name any certificate for a number of one-thousandths of a Preferred Share (or other securities
of the Company) is issued upon the exercise of Rights shall for all purposes be deemed to have become the holder of record of
Preferred Shares (or other securities of the Company) represented thereon, and such certificate shall be dated the date upon which
the Rights Certificate evidencing such Rights was duly surrendered and payment of the Total Exercise Price with respect to which
the Rights have been exercised (and any applicable transfer taxes) was made; provided, however, that if the
date of such surrender and payment is a date upon which the transfer books of the Company are closed, such Person shall be deemed
to have become the record holder of such shares on, and such certificate shall be dated, the next succeeding Business Day on which
the transfer books of the Company are open. Prior to the exercise of the Rights evidenced thereby, the holder of a Rights Certificate
shall not be entitled to any rights of a holder of Preferred Shares (or other securities of the Company) for which the Rights
shall be exercisable, including, without limitation, the right to vote, to receive dividends or other distributions or to exercise
any preemptive rights, and shall not be entitled to receive any notice of any proceedings of the Company, except as provided herein.


 


Section 11. Adjustment
of Exercise Price, Number of Shares or Number of Rights. The Exercise Price, the number and kind of shares or other
property covered by each Right and the number of Rights outstanding are subject to adjustment from time to time as provided in
this Section 11.


 


(a)       (i)  Notwithstanding
anything in this Agreement to the contrary, in the event the Company shall at any time after the date of this Agreement (A) declare
a dividend on the Preferred Shares payable in Preferred Shares, (B) subdivide the outstanding Preferred Shares, (C) combine
the outstanding Preferred Shares (by reverse stock split or otherwise) into a smaller number of Preferred Shares, or (D) issue
any shares of its capital stock in a reclassification of the Preferred Shares (including any such reclassification in connection
with a consolidation or merger in which the Company is the continuing or surviving corporation), then, in each such event, except
as otherwise provided in this Section 11 and Section 7(e) hereof: (1) the Exercise Price in effect at the time of
the record date for such dividend or of the effective date of such subdivision, combination or reclassification shall be adjusted
so that the Exercise Price thereafter shall equal the result obtained by dividing the Exercise Price in effect immediately prior
to such time by a fraction (the “Adjustment Fraction”), the numerator of which shall be the total number of
Preferred Shares (or shares of capital stock issued in such reclassification of the Preferred Shares)



    	 	 -16-	 



    	



    

outstanding immediately
following such time and the denominator of which shall be the total number of Preferred Shares outstanding immediately prior to
such time; provided, however, that in no event shall the consideration to be paid upon the exercise of one
Right be less than the aggregate par value of the shares of capital stock of the Company issuable upon exercise of such Right;
and (2) the number of one-thousandths of a Preferred Share (or share of such other capital stock) issuable upon the exercise
of each Right shall equal the number of one-thousandths of a Preferred Share (or share of such other capital stock) as was issuable
upon exercise of a Right immediately prior to the occurrence of the event described in clauses (A) – (D) of this Section 11(a)(i),
multiplied by the Adjustment Fraction; provided, however, that, no such adjustment shall be made pursuant to
this Section 11(a)(i) to the extent that there shall have simultaneously occurred an event described in clause (A), (B),
(C) or (D) of Section 11(n) with a proportionate adjustment being made thereunder. Each share of Common Stock that shall
become outstanding after an adjustment has been made pursuant to this Section 11(a)(i) shall have associated with it the
number of Rights, exercisable at the Exercise Price and for the number of one-thousandths of a Preferred Share (or shares of such
other capital stock) as one share of Common Stock has associated with it immediately following the adjustment made pursuant to
this Section 11(a)(i).


 


(ii)       Subject
to Section 24 of this Agreement, in the event a Triggering Event shall have occurred, then promptly following such Triggering
Event each holder of a Right, except as provided in Section 7(e) hereof, shall thereafter have the right to receive for each
Right, upon exercise thereof in accordance with the terms of this Agreement and payment of the Exercise Price in effect immediately
prior to the occurrence of the Triggering Event, in lieu of a number of one-thousandths of a Preferred Share, such number of shares
of Common Stock of the Company as shall equal the result obtained by multiplying the Exercise Price in effect immediately prior
to the occurrence of the Triggering Event by the number of one-thousandths of a Preferred Share for which a Right was exercisable
(or would have been exercisable if the Distribution Date had occurred) immediately prior to the first occurrence of a Triggering
Event, and dividing that product by 50% of the Current Per Share Market Price for shares of Common Stock on the date of occurrence
of the Triggering Event; provided, however, that the Exercise Price and the number of shares of Common Stock
of the Company so receivable upon exercise of a Right shall be subject to further adjustment as appropriate in accordance with
Section 11(e) hereof to reflect any events occurring in respect of the shares of Common Stock of the Company after the occurrence
of the Triggering Event.


 


(iii)       In
lieu of issuing shares of Common Stock in accordance with Section 11(a)(ii) hereof, the Company may, if the Board determines
that such action is necessary or appropriate and not contrary to the interest of holders of Rights and, in the event that the number
of shares of Common Stock which are authorized by the Company’s Certificate of Incorporation but not outstanding or reserved
for issuance for purposes other than upon exercise of the Rights are not sufficient to permit the exercise in full of the Rights,
or if any necessary regulatory approval for such issuance has not been obtained by the Company, the Company shall: (A) determine
the excess of (1) the value of the shares of Common Stock issuable upon the exercise of a Right (the “Current Value”)
over (2) the Exercise Price (such excess, the “Spread”) and (B) with respect to each Right, make adequate
provision to substitute for such shares of Common Stock, upon exercise of the



    	 	 -17-	 



    	



    

Rights, (1) cash,
(2) a reduction in the Exercise Price, (3) other equity securities of the Company (including, without limitation, shares
or units of shares of any series of preferred stock which the Board has deemed to have the same value as Common Stock (such shares
or units of shares of preferred stock are herein called “Common Stock Equivalents”)), except to the extent
that the Company has not obtained any necessary shareholder or regulatory approval for such issuance, (4) debt securities
of the Company, except to the extent that the Company has not obtained any necessary shareholder or regulatory approval for such
issuance, (5) other assets or (6) any combination of the foregoing, having an aggregate value equal to the Current Value,
where such aggregate value has been determined by the Board based upon the advice of a nationally recognized investment banking
firm selected by the Board; provided, however, if the Company shall not have made adequate provision to deliver
value pursuant to clause (B) above within thirty (30) days following the later of (x) the first occurrence of a Triggering
Event and (y) the date on which the Company’s right of redemption pursuant to Section 23(a) expires (the later
of (x) and (y) being referred to herein as the “Section 11(a)(ii) Trigger Date”), then the Company shall
be obligated to deliver, upon the surrender for exercise of a Right and without requiring payment of the Exercise Price, Common
Stock (to the extent available), except to the extent that the Company has not obtained any necessary shareholder or regulatory
approval for such issuance, and then, if necessary, cash, which shares and/or cash have an aggregate value equal to the Spread.
If the Board shall determine in good faith that it is likely that sufficient additional Common Stock could be authorized for issuance
upon exercise in full of the Rights or that any necessary regulatory approval for such issuance will be obtained, the thirty (30)
day period set forth above may be extended to the extent necessary, but not more than ninety (90) days after the Section 11(a)(ii)
Trigger Date, in order that the Company may seek shareholder approval for the authorization of such additional shares or take
action to obtain such regulatory approval (such period, as it may be extended, the “Substitution Period”).
To the extent that the Company determines that some action need be taken pursuant to the first and/or second sentences of this
Section 11(a)(iii), the Company (x) shall provide, subject to Section 7(e) hereof, that such action shall apply
uniformly to all outstanding Rights and (y) may suspend the exercisability of the Rights until the expiration of the Substitution
Period in order to seek any authorization of additional shares, to take any action to obtain any required regulatory approval
and/or to decide the appropriate form of distribution to be made pursuant to such first sentence and to determine the value thereof.
In the event of any such suspension, the Company shall issue a public announcement stating that the exercisability of the Rights
has been temporarily suspended, as well as a public announcement at such time as the suspension is no longer in effect. For purposes
of this Section 11(a)(iii), the value of the Common Stock shall be the Current Per Share Market Price of the Common Stock
on the Section 11(a)(ii) Trigger Date and the value of any Common Stock Equivalent shall be deemed to have the same value
as the Common Stock on such date.


 


(b)       In
case the Company shall, at any time after the date of this Agreement, fix a record date for the issuance of rights, options or
warrants to all holders of Preferred Shares entitling such holders (for a period expiring within forty five (45) calendar days
after such record date) to subscribe for or purchase Preferred Shares or Equivalent Shares or securities convertible into Preferred
Shares or Equivalent Shares at a price per share (or having a conversion price per share, if a security convertible into Preferred
Shares or Equivalent Shares) less than the then



    	 	 -18-	 



    	



    

Current Per Share Market
Price of the Preferred Shares or Equivalent Shares on such record date, then, in each such case, the Exercise Price to be in effect
after such record date shall be determined by multiplying the Exercise Price in effect immediately prior to such record date by
a fraction, the numerator of which shall be the number of Preferred Shares and Equivalent Shares (if any) outstanding on such
record date, plus the number of Preferred Shares or Equivalent Shares, as the case may be, which the aggregate offering price
of the total number of Preferred Shares or Equivalent Shares, as the case may be, to be offered or issued (and/or the aggregate
initial conversion price of the convertible securities to be offered or issued) would purchase at such current market price, and
the denominator of which shall be the number of Preferred Shares and Equivalent Shares (if any) outstanding on such record date,
plus the number of additional Preferred Shares or Equivalent Shares, as the case may be, to be offered for subscription or purchase
(or into which the convertible securities so to be offered are initially convertible); provided, however, that
in no event shall the consideration to be paid upon the exercise of one Right be less than the aggregate par value of the shares
of capital stock of the Company issuable upon exercise of one Right. In case such subscription price may be paid in a consideration
part or all of which shall be in a form other than cash, the value of such consideration shall be as determined in good faith
by the Board, whose determination shall be described in a statement filed with the Rights Agent and shall be binding on the Rights
Agent and the holders of the Rights. Preferred Shares and Equivalent Shares owned by or held for the account of the Company shall
not be deemed outstanding for the purpose of any such computation. Such adjustment shall be made successively whenever such a
record date is fixed, and in the event that such rights, options or warrants are not so issued, the Exercise Price shall be adjusted
to be the Exercise Price which would then be in effect if such record date had not been fixed.


 


(c)       In
case the Company shall, at any time after the date of this Agreement, fix a record date for the making of a distribution to all
holders of the Preferred Shares or of any class or series of Equivalent Shares (including any such distribution made in connection
with a consolidation or merger in which the Company is the continuing or surviving corporation) of evidences of indebtedness or
assets (other than a regular quarterly cash dividend, if any, or a dividend payable in Preferred Shares) or subscription rights,
options or warrants (excluding those referred to in Section 11(b)), then, in each such case, the Exercise Price to be in
effect after such record date shall be determined by multiplying the Exercise Price in effect immediately prior to such record
date by a fraction, the numerator of which shall be the Current Per Share Market Price of a Preferred Share or an Equivalent Share
on such record date, less the fair market value per Preferred Share or Equivalent Share (as determined in good faith by the Board
of Directors of the Company, whose determination shall be described in a statement filed with the Rights Agent) of the portion
of the cash, assets or evidences of indebtedness so to be distributed or of such subscription rights or warrants applicable to
a Preferred Share or Equivalent Share, as the case may be, and the denominator of which shall be such Current Per Share Market
Price of a Preferred Share or Equivalent Share on such record date; provided, however, that in no event shall
the consideration to be paid upon the exercise of one Right be less than the aggregate par value of the shares of capital stock
of the Company issuable upon exercise of one Right. Such adjustments shall be made successively whenever such a record date is
fixed, and in the event that such distribution is not so made, the Exercise Price shall be adjusted to be the Exercise Price which
would have been in effect if such record date had not been fixed.



    	 	 -19-	 



    	



    

(d)       Notwithstanding
anything to the contrary, no adjustment in the Exercise Price shall be required unless such adjustment would require an increase
or decrease of at least 1% in the Exercise Price; provided, however, that any adjustments which by reason of
this Section 11(d) are not required to be made shall be carried forward and taken into account in any subsequent adjustment.
All calculations under this Section 11 shall be made to the nearest cent or to the nearest ten-thousandth of a share of Common
Stock or other share or one hundred-thousandth of a Preferred Share, as the case may be. Notwithstanding the first sentence of
this Section 11(d), any adjustment required by this Section 11 shall be made no later than the earlier of (i) three
(3) years from the date of the transaction which requires such adjustment or (ii) the Expiration Date.


 


(e)       If
as a result of an adjustment made pursuant to Section 11(a) or 13(a) hereof, the holder of any Right thereafter exercised
shall become entitled to receive any shares of capital stock other than Preferred Shares, thereafter the number of such other shares
so receivable upon exercise of any Right and, if required, the Exercise Price thereof, shall be subject to adjustment from time
to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the Preferred Shares contained
in Sections 11(a), 11(b), 11(c), 11(d), 11(g), 11(h), 11(i), 11(j), 11(k) and 11(l), and the provisions of Sections 7,
9, 10, 13 and 14 with respect to the Preferred Shares shall apply on like terms to any such other shares.


 


(f)       All
Rights originally issued by the Company subsequent to any adjustment made to the Exercise Price hereunder shall evidence the right
to purchase, at the adjusted Exercise Price, the number of one-thousandths of a Preferred Share purchasable from time to time hereunder
upon exercise of the Rights, all subject to further adjustment as provided herein.


 


(g)       Unless
the Company shall have exercised its election as provided in Section 11(h), upon each adjustment of the Exercise Price as
a result of the calculations made in Section 11(b) and (c), each Right outstanding immediately prior to the making of such
adjustment shall thereafter evidence the right to purchase, at the adjusted Exercise Price, that number of Preferred Shares (calculated
to the nearest one hundred-thousandth of a share) obtained by (i) multiplying (x) the number of Preferred Shares covered
by a Right immediately prior to this adjustment, by (y) the Exercise Price in effect immediately prior to such adjustment
of the Exercise Price, and (ii) dividing the product so obtained by the Exercise Price in effect immediately after such adjustment
of the Exercise Price.


 


(h)       The
Company may elect on or after the date of any adjustment of the Exercise Price as a result of the calculations made in Section 11(b)
or (c) to adjust the number of Rights, in substitution for any adjustment in the number of Preferred Shares purchasable upon the
exercise of a Right. Each of the Rights outstanding after such adjustment of the number of Rights shall be exercisable for the
number of one-thousandths of a Preferred Share for which a Right was exercisable immediately prior to such adjustment. Each Right
held of record prior to such adjustment of the number of Rights shall become that number of Rights (calculated to the nearest one
hundred-thousandth) obtained by dividing the Exercise Price in effect immediately prior to adjustment of the Exercise Price by
the Exercise Price in effect immediately after adjustment of the Exercise Price. The Company shall make a public announcement of
its election to adjust the number of Rights, indicating the record date for the adjustment, and, if known at the time, the amount
of the adjustment to be made. This record date may be the date on which the Exercise



    	 	 -20-	 



    	



    

Price is adjusted or
any day thereafter, but, if the Rights Certificates have been issued, shall be at least ten (10) days later than the date of the
public announcement. If Rights Certificates have been issued, upon each adjustment of the number of Rights pursuant to this Section 11(h),
the Company shall, as promptly as practicable, cause to be distributed to holders of record of Rights Certificates on such record
date Rights Certificates evidencing, subject to Section 14 hereof, the additional Rights to which such holders shall be entitled
as a result of such adjustment, or, at the option of the Company, shall cause to be distributed to such holders of record in substitution
and replacement for the Rights Certificates held by such holders prior to the date of adjustment, and upon surrender thereof, if
required by the Company, new Rights Certificates evidencing all the Rights to which such holders shall be entitled after such adjustment.
Rights Certificates so to be distributed shall be issued, executed and countersigned in the manner provided for herein (and may
bear, at the option of the Company, the adjusted Exercise Price) and shall be registered in the names of the holders of record
of Rights Certificates on the record date specified in the public announcement.


 


(i)       Irrespective
of any adjustment or change in the Exercise Price or the number of Preferred Shares issuable upon the exercise of the Rights, the
Rights Certificates theretofore and thereafter issued may continue to express the Exercise Price per one one-thousandth of a Preferred
Share and the number of one-thousandths of a Preferred Share which were expressed in the initial Rights Certificates issued hereunder.


 


(j)       Before
taking any action that would cause an adjustment reducing the Exercise Price below the par or stated value, if any, of the number
of one-thousandths of a Preferred Share issuable upon exercise of the Rights, the Company shall take any corporate action which
may, in the opinion of its counsel, be necessary in order that the Company may validly and legally issue as fully paid and nonassessable
shares such number of one-thousandths of a Preferred Share at such adjusted Exercise Price.


 


(k)       In
any case in which this Section 11 shall require that an adjustment in the Exercise Price be made effective as of a record
date for a specified event, the Company may elect to defer until the occurrence of such event the issuing to the holder of any
Right exercised after such record date of the number of one-thousandths of a Preferred Share and other capital stock or securities
of the Company, if any, issuable upon such exercise over and above the number of one-thousandths of a Preferred Share and other
capital stock or securities of the Company, if any, issuable upon such exercise on the basis of the Exercise Price in effect prior
to such adjustment; provided, however, that the Company shall deliver to such holder a due bill or other appropriate
instrument evidencing such holder’s right to receive such additional shares (fractional or otherwise) upon the occurrence
of the event requiring such adjustment.


 


(l)       Notwithstanding
anything in this Section 11 to the contrary, prior to the Distribution Date, the Company shall be entitled to make such reductions
in the Exercise Price, in addition to those adjustments expressly required by this Section 11, as and to the extent that it
in its sole discretion shall determine to be advisable in order that any (i) consolidation or subdivision of the Preferred
Shares or Common Stock, (ii) issuance wholly for cash of any Preferred Shares or Common Stock at less than the current market
price, (iii) issuance wholly for cash of Preferred Shares or Common Stock or securities which by their terms are convertible
into or exchangeable for Preferred or Common Stock, (iv) stock dividends or (v) issuance of rights, options or warrants



    	 	 -21-	 



    	



    

referred to in this Section 11,
hereafter made by the Company to holders of its Preferred Shares or Common Stock shall not be taxable to such shareholders.


 


(m)       The
Company covenants and agrees that, after the Distribution Date, it will not, except as permitted by Sections 23, 24 or 27
hereof, take (or permit to be taken) any action if at the time such action is taken it is reasonably foreseeable that such action
will diminish substantially or otherwise eliminate the benefits intended to be afforded by the Rights.


 


(n)       In
the event the Company shall at any time after the date of this Agreement (A) declare a dividend on the Common Stock payable
in shares of Common Stock, (B) subdivide the outstanding shares of Common Stock, (C) combine the outstanding Common
Stock (by reverse stock split or otherwise) into a smaller number of shares of Common Stock, or (D) issue any shares of its
capital stock in a reclassification of the shares of Common Stock (including any such reclassification in connection with a consolidation
or merger in which the Company is the continuing or surviving corporation), then, in each such event, except as otherwise provided
in Section 11(a) and Section 7(e) hereof: (1) each share of Common Stock (or shares of capital stock issued in
such reclassification of the Common Stock) outstanding immediately following such time shall have associated with it the number
of Rights as were associated with one share of Common Stock immediately prior to the occurrence of the event described in clauses
(A)-(D) above; (2) the Exercise Price in effect at the time of the record date for such dividend or of the effective
date of such subdivision, combination or reclassification shall be adjusted so that the Exercise Price thereafter shall equal
the result obtained by multiplying the Exercise Price in effect immediately prior to such time by a fraction, the numerator of
which shall be the total number of shares of Common Stock outstanding immediately prior to the event described in clauses (A)-(D)
above, and the denominator of which shall be the total number of shares of Common Stock outstanding immediately after such event;
provided, however, that in no event shall the consideration to be paid upon the exercise of one Right be less than
the aggregate par value of the shares of capital stock of the Company issuable upon exercise of such Right; and (3) the
number of one-thousandths of a Preferred Share (or shares of such other capital stock) issuable upon the exercise of each Right
outstanding after such event shall equal the number of one-thousandths of a Preferred Share (or shares of such other capital stock)
as were issuable with respect to one Right immediately prior to such event. Each share of Common Stock that shall become outstanding
after an adjustment has been made pursuant to this Section 11(n) shall have associated with it the number of Rights, exercisable
at the Exercise Price and for the number of one-thousandths of a Preferred Share (or shares of such other capital stock) as one
share of Common Stock has associated with it immediately following the adjustment made pursuant to this Section 11(n). If
an event occurs which would require an adjustment under both this Section 11(n) and Section 11(a)(ii) hereof, the adjustment
provided for in this Section 11(n) shall be in addition to, and shall be made prior to, any adjustment required pursuant
to Section 11(a)(ii) hereof.


 


Section 12. Certificate
of Adjusted Exercise Price or Number of Shares. Whenever an adjustment is made as provided in Sections 11 and 13
hereof, the Company shall promptly (a) prepare a certificate setting forth such adjustment and a brief statement of the facts
accounting for such adjustment, (b) file with the Rights Agent and with each transfer agent for the Preferred Shares a copy
of such certificate and (c) if a Distribution Date has occurred, mail a brief summary thereof to each holder of a Rights Certificate
in accordance with Section 26 hereof. Notwithstanding the foregoing sentence, the failure of the Company to make such certification
or



    	 	 -22-	 



    	



    

give such notice shall
not affect the validity of such adjustment or the force or effect of the requirement for such adjustment. The Rights Agent shall
be fully protected in relying on any such certificate and on any adjustment contained therein and shall not be deemed to have knowledge
of such adjustment unless and until it shall have received such certificate.


 


Section 13. Consolidation,
Merger or Sale or Transfer of Assets or Earning Power.


 


(a)       In
the event that, following a Triggering Event, directly or indirectly:


 


(i)       the
Company shall consolidate with, or merge with and into, any other Person (other than a wholly-owned Subsidiary of the Company in
a transaction the principal purpose of which is to change the jurisdiction of incorporation of the Company and which complies with
Section 11(m) hereof);


 


(ii)       any
Person shall consolidate with the Company, or merge with and into the Company and the Company shall be the continuing or surviving
corporation of such consolidation or merger and, in connection with such merger, all or part of the shares of Common Stock shall
be changed into or exchanged for stock or other securities of any other person (or the Company); or


 


(iii)       the
Company shall sell or otherwise transfer (or one or more of its Subsidiaries shall sell or otherwise transfer), in one or more
transactions, assets or earning power aggregating 50% or more of the assets or earning power of the Company and its Subsidiaries
(taken as a whole) to any other Person or Persons (other than the Company or one or more of its wholly owned Subsidiaries in one
or more transactions, each of which individually (and together) complies with Section 11(m) hereof),


 


then, concurrently with
and in each such case:


 


a.       each
holder of a Right (except as provided herein) shall thereafter have the right to receive, upon the exercise thereof, at a price
equal to the Total Exercise Price applicable immediately prior to the occurrence of the Section 13 Event in accordance with
the terms of this Agreement, such number of validly authorized and issued, fully paid, nonassessable and freely tradeable shares
of Common Stock of the Principal Party (as hereinafter defined), free of any liens, encumbrances, rights of first refusal or other
adverse claims, as shall be equal to the result obtained by dividing such Total Exercise Price by 50% of the Current Per Share
Market Price of the shares of Common Stock of such Principal Party on the date of consummation of such Section 13 Event;
provided, however, that the Exercise Price and the number of shares of Common Stock of such Principal Party so receivable
upon exercise of a Right shall be subject to further adjustment as appropriate in accordance with Section 11(e) hereof;


 


b.       such
Principal Party shall thereafter be liable for, and shall assume, by virtue of such Section 13 Event, all the obligations
and duties of the Company pursuant to this Agreement;



    	 	 -23-	 



    	



    

c.       the
term “Company” shall thereafter be deemed to refer to such Principal Party, it being specifically intended that the
provisions of Section 11 hereof shall apply only to such Principal Party following the first occurrence of a Section 13
Event;


 


d.       such
Principal Party shall take such steps (including, but not limited to, the reservation of a sufficient number of its Common Stock)
in connection with the consummation of any such transaction as may be necessary to ensure that the provisions hereof shall thereafter
be applicable, as nearly as reasonably may be, in relation to its shares of Common Stock thereafter deliverable upon the exercise
of the Rights; and


 


e.       upon
the subsequent occurrence of any consolidation, merger, sale or transfer of assets or other extraordinary transaction in respect
of such Principal Party, each holder of a Right shall thereupon be entitled to receive, upon exercise of a Right and payment of
the Total Exercise Price as provided in this Section 13(a), such cash, shares, rights, warrants and other property which such
holder would have been entitled to receive had such holder, at the time of such transaction, owned the shares of Common Stock of
the Principal Party receivable upon the exercise of such Right pursuant to this Section 13(a), and such Principal Party shall
take such steps (including, but not limited to, reservation of shares of stock) as may be necessary to permit the subsequent exercise
of the Rights in accordance with the terms hereof for such cash, shares, rights, warrants and other property.


 


For purposes hereof,
the “earning power” of the Company and its Subsidiaries shall be determined in good faith by the Board on the basis
of the operating earnings of each business operated by the Company and its Subsidiaries during the three fiscal years preceding
the date of such determination (or, in the case of any business not operated by the Company or any Subsidiary during three full
fiscal years preceding such date, during the period such business was operated by the Company or any Subsidiary).


 


(b)       For
purposes of this Agreement, the term “Principal Party” shall mean:


 


(i)       in
the case of any transaction described in clause (i) or (ii) of Section 13(a) hereof: (A) the Person that is the issuer
of the securities into which the shares of Common Stock are converted in such merger or consolidation, or, if there is more than
one such issuer, the issuer the shares of Common Stock of which have the greatest aggregate market value of shares outstanding,
or (B) if no securities are so issued, (x) the Person that is the other party to the merger, if such Person survives
said merger, or, if there is more than one such Person, the Person the shares of Common Stock of which have the greatest aggregate
market value of shares outstanding or (y) if the Person that is the other party to the merger does not survive the merger,
the Person that does survive the merger (including the Company if it survives) or (z) the Person resulting from the consolidation;
and


 


(ii)       in
the case of any transaction described in clause (iii) of Section 13(a) hereof, the Person that is the party receiving the
greatest portion of the assets or earning power transferred pursuant to such transaction or transactions, or, if more than one
Person that is a party to such transaction or transactions receives the same portion of the assets or earning power so transferred
and each such portion would, were it not for the other equal portions, constitute the greatest portion of the assets or earning
power so transferred, or if





    	 	 -24-	 



    	



    

the Person
receiving the greatest portion of the assets or earning power cannot be determined, whichever of such Persons is the issuer of
shares of Common Stock having the greatest aggregate market value of shares outstanding; provided, however,
that in any such case described in the foregoing clause (b)(i) or (b)(ii), if the shares of Common Stock of such Person are not
at such time or have not been continuously over the preceding 12-month period registered under Section 12 of the Exchange
Act, then (1) if such Person is a direct or indirect Subsidiary of another Person the shares of Common Stock of which are
and have been so registered, the term “Principal Party” shall refer to such other Person, or (2) if such Person
is a Subsidiary, directly or indirectly, of more than one Person, the Common Stock of which are and have been so registered, the
term “Principal Party” shall refer to whichever of such Persons is the issuer of shares of Common Stock having the
greatest aggregate market value of shares outstanding, or (3) if such Person is owned, directly or indirectly, by a joint
venture formed by two or more Persons that are not owned, directly or indirectly by the same Person, the rules set forth in clauses
(1) and (2) above shall apply to each of the owners having an interest in the venture as if the Person owned by the joint venture
was a Subsidiary of both or all of such joint venturers, and the Principal Party in each such case shall bear the obligations
set forth in this Section 13 in the same ratio as its interest in such Person bears to the total of such interests.


 


(c)       The
Company shall not consummate any Section 13 Event unless the Principal Party shall have a sufficient number of authorized
shares of Common Stock that have not been issued or reserved for issuance to permit the exercise in full of the Rights in accordance
with this Section 13 and unless prior thereto the Company and such issuer shall have executed and delivered to the Rights
Agent a supplemental agreement confirming that such Principal Party shall, upon consummation of such Section 13 Event, assume
this Agreement in accordance with Sections 13(a) and 13(b) hereof, that all rights of first refusal or preemptive rights in
respect of the issuance of shares of Common Stock of such Principal Party upon exercise of outstanding Rights have been waived,
that there are no rights, warrants, instruments or securities outstanding or any agreements or arrangements which, as a result
of the consummation of such transaction, would eliminate or substantially diminish the benefits intended to be afforded by the
Rights and that such transaction shall not result in a default by such Principal Party under this Agreement, and further providing
that, as soon as practicable after the date of such Section 13 Event, such Principal Party will:


 


(i)       prepare
and file a registration statement under the Securities Act with respect to the Rights and the securities purchasable upon exercise
of the Rights on an appropriate form, use its best efforts to cause such registration statement to become effective as soon as
practicable after such filing and use its best efforts to cause such registration statement to remain effective (with a prospectus
at all times meeting the requirements of the Securities Act) until the Expiration Date, and similarly comply with applicable state
securities laws;


 


(ii)       use
its best efforts to list (or continue the listing of) the Rights and the securities purchasable upon exercise of the Rights on
a national securities exchange or to meet the eligibility requirements for quotation on the New York Stock Exchange and list (or
continue the listing of) the Rights and the securities purchasable upon exercise of the Rights on the New York Stock Exchange;
and



    	 	 -25-	 



    	



    


(iii)       deliver
to holders of the Rights historical financial statements for such Principal Party which comply in all respects with the requirements
for registration on Form F-1 (or any successor form) under the Securities Act.


 



In the event that at
any time after the occurrence of a Triggering Event some or all of the Rights shall not have been exercised at the time of a transaction
described in this Section 13, the Rights which have not theretofore been exercised shall thereafter be exercisable in the
manner described in Section 13(a) (without taking into account any prior adjustment required by Section 11(a)(ii)).


 


(d)       In
case the “Principal Party” for purposes of Section 13(b) hereof has provision in any of its authorized securities
or in its certificate of incorporation or by-laws or other instrument governing its corporate affairs, which provision would have
the effect of (i) causing such Principal Party to issue (other than to holders of Rights pursuant to Section 13 hereof),
in connection with, or as a consequence of, the consummation of a Section 13 Event, shares of Common Stock or Equivalent Shares
of such Principal Party at less than the then Current Per Share Market Price thereof or securities exercisable for, or convertible
into, shares of Common Stock or Equivalent Shares of such Principal Party at less than such then Current Per Share Market Price,
or (ii) providing for any special payment, tax or similar provision in connection with the issuance of the shares of Common
Stock of such Principal Party pursuant to the provisions of Section 13 hereof, then, in such event, the Company hereby agrees
with each holder of Rights that it shall not consummate any such transaction unless prior thereto the Company and such Principal
Party shall have executed and delivered to the Rights Agent a supplemental agreement providing that the provision in question of
such Principal Party shall have been canceled, waived or amended, or that the authorized securities shall be redeemed, so that
the applicable provision will have no effect in connection with or as a consequence of, the consummation of the proposed transaction.


 


(e)       The
Company covenants and agrees that it shall not, at any time after the Distribution Date, effect or permit to occur any Section 13
Event, if (i) at the time or immediately after such Section 13 Event there are any rights, warrants or other instruments
or securities outstanding or agreements in effect which would substantially diminish or otherwise eliminate the benefits intended
to be afforded by the Rights, (ii) prior to, simultaneously with or immediately after such Section 13 Event, the shareholders
of the Person who constitutes, or would constitute, the “Principal Party” for purposes of Section 13(b) hereof
shall have received a distribution of Rights previously owned by such Person or any of its Affiliates or Associates or (iii) the
form or nature of organization of the Principal Party would preclude or limit the exercisability of the Rights.


 


(f)       The
provisions of this Section 13 shall similarly apply to successive mergers or consolidations or sales or other transfers.


 


Section 14. Fractional
Rights and Fractional Shares.


 


(a)       The
Company shall not be required to issue fractions of Rights or to distribute Rights Certificates which evidence fractional Rights.
In lieu of such fractional Rights, there shall be paid to the registered holders of the Rights Certificates with regard to which
such fractional Rights would otherwise be issuable, an amount in cash equal to the same fraction of the



    	 	 -26-	 



    	



    

current market value
of a whole Right. For the purposes of this Section 14(a), the current market value of a whole Right shall be the closing price
of the Rights for the Trading Day immediately prior to the date on which such fractional Rights would have been otherwise issuable,
as determined pursuant to this Agreement.


 


(b)       The
Company shall not be required to issue fractions of Preferred Shares (other than fractions that are integral multiples of one
one-thousandth of a Preferred Share) upon exercise of the Rights or to distribute certificates which evidence fractional Preferred
Shares (other than fractions that are integral multiples of one one-thousandth of a Preferred Share). Interests in fractions of
Preferred Shares in integral multiples of one one-thousandth of a Preferred Share may, at the election of the Company, be evidenced
by depositary receipts, pursuant to an appropriate agreement between the Company and a depositary selected by it; provided,
that such agreement shall provide that the holders of such depositary receipts shall have all the rights, privileges and preferences
to which they are entitled as beneficial owners of the Preferred Shares represented by such depositary receipts. In lieu of fractional
Preferred Shares that are not integral multiples of one one-thousandth of a Preferred Share, the Company shall pay to the registered
holders of Rights Certificates at the time such Rights are exercised as herein provided an amount in cash equal to the same fraction
of the current market value of a Preferred Share. For purposes of this Section 14(b), the current market value of a Preferred
Share shall be one thousand times the closing price of a share of Common Stock (as determined pursuant to the terms hereof) for
the Trading Day immediately prior to the date of such exercise.


 


(c)       The
Company shall not be required to issue fractions of shares of Common Stock or to distribute certificates which evidence fractional
shares of Common Stock upon the exercise or exchange of Rights. In lieu of such fractional shares of Common Stock, the Company
shall pay to the registered holders of Rights Certificates at the time such Rights are exercised as herein provided an amount in
cash equal to the same fraction of the current market value of a share of Common Stock. For purposes of this Section 14(c),
the current market value of a share of Common Stock shall be the closing price of a share of Common Stock (as determined pursuant
to the terms hereof) for the Trading Day immediately prior to the date of such exercise.


 


(d)       The
holder of a Right by the acceptance of the Right expressly waives his or her right to receive any fractional Rights or any fractional
shares (other than fractions that are integral multiples of one one-thousandth of a Preferred Share) upon exercise of a Right.


 


Section 15. Rights
of Action. All rights of action in respect of this Agreement, excepting the rights of action given to the Rights Agent
under Section 18 hereof, are vested in the respective registered holders of the Rights Certificates (and, prior to the Distribution
Date, the registered holders of the shares of Common Stock); and any registered holder of any Rights Certificate (or, prior
to the Distribution Date, of the shares of Common Stock), without the consent of the Rights Agent or of the holder of any other
Rights Certificate (or, prior to the Distribution Date, of the shares of Common Stock), may, in his or her own behalf and for his
or her own benefit, enforce, and may institute and maintain any suit, action or proceeding against the Company to enforce, or otherwise
act in respect of, his or her right to exercise the Rights evidenced by such Rights Certificate in the manner provided in such
Rights Certificate and in this Agreement. Without limiting the foregoing or any remedies available to the holders of Rights, it
is specifically acknowledged that the holders of Rights would not have an adequate remedy at law for any breach



    	 	 -27-	 



    	



    

of this Agreement and
will be entitled to specific performance of the obligations under, and injunctive relief against actual or threatened violations
of, the obligations of any Person subject to this Agreement. Notwithstanding anything in this Agreement to the contrary, neither
the Company nor the Rights Agent shall have any liability to any holder of a Right or other Person as a result of the Company’s
or the Rights Agent’s inability to perform any of their respective obligations under this Agreement by reason of any preliminary
or permanent injunction or other order, judgment, decree or ruling (whether interlocutory or final) issued by a court or a governmental,
regulatory, self-regulatory or administrative agency or commission, or any statute, rule, regulation or executive order promulgated
or enacted by any governmental authority, prohibiting or otherwise restraining performance of such obligation.


 


Section 16. Agreement
of Rights Holders. Every holder of a Right, by accepting the same, consents and agrees with the Company and the Rights
Agent and with every other holder of a Right that:


 


(a)       prior
to the Distribution Date, the Rights will be transferable only in connection with the transfer of the shares of Common Stock;


 


(b)       after
the Distribution Date, the Rights Certificates are transferable only on the registry books of the Rights Agent if surrendered at
the principal office or offices of the Rights Agent designated for such purposes, duly endorsed or accompanied by a proper instrument
of transfer and with the appropriate forms and certificates fully executed; and


 


(c)       subject
to Sections 6(a) and 7(f) hereof, the Company and the Rights Agent may deem and treat the person in whose name the Rights
Certificate (or, prior to the Distribution Date, the associated Common Stock certificate) is registered as the absolute owner thereof
and of the Rights evidenced thereby (notwithstanding any notations of ownership or writing on the Rights Certificates or the associated
Common Stock certificate made by anyone other than the Company or the Rights Agent) for all purposes whatsoever, and neither the
Company nor the Rights Agent shall be affected by any notice to the contrary.


 


Section 17. Rights
Certificate Holder Not Deemed a Shareholder. No holder, as such, of any Rights Certificate shall be entitled to vote,
receive dividends or be deemed for any purpose to be the holder of the Preferred Shares or any other securities of the Company
which may at any time be issuable on the exercise of the Rights represented thereby, nor shall anything contained herein or in
any Rights Certificate be construed to confer upon the holder of any Rights Certificate, as such, any of the rights of a shareholder
of the Company or any right to vote for the election of directors or upon any matter submitted to shareholders at any meeting thereof,
or to give or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting shareholders
(except as provided in Section 25 hereof), or to receive dividends or subscription rights, or otherwise, until the Right or
Rights evidenced by such Rights Certificate shall have been exercised in accordance with the provisions hereof.


 


Section 18. The
Rights Agent.


 


(a)       The
Company agrees to pay to the Rights Agent reasonable compensation for all services rendered by it hereunder and, from time to time,
on demand of the Rights Agent,



    	 	 -28-	 



    	



    

its reasonable expenses and counsel fees
and other disbursements incurred in the administration and execution of this Agreement and the exercise and performance of its
duties hereunder. The Company also agrees to indemnify the Rights Agent for, and to hold it harmless against, any loss, liability
or expense, incurred without negligence, bad faith or willful misconduct on the part of the Rights Agent, for anything done or
omitted by the Rights Agent in connection with the acceptance and administration of this Agreement, including the costs and expenses
of defending against any claim of liability in the premises. In no event will the Rights Agent be liable for special, indirect,
incidental or consequential loss or damage of any kind whatsoever, even if the Rights Agent has been advised of the possibility
of such loss or damage.


 


(b)       The
Rights Agent shall be protected and shall incur no liability for, or in respect of any action taken, suffered or omitted by it
in connection with, its administration of this Agreement in reliance upon any Rights Certificate or certificate for the Preferred
Shares or shares of Common Stock or for other securities of the Company, instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent, certificate, statement or other paper or document reasonably believed
by it to be genuine and to be signed, executed and, where necessary, verified or acknowledged, by the proper Person or Persons,
or otherwise upon the advice of counsel as set forth in Section 20 hereof.


 


Section 19. Merger
or Consolidation or Change of Name of Rights Agent. Any corporation into which the Rights Agent or any successor Rights
Agent may be merged or with which it may be consolidated, or any corporation resulting from any merger or consolidation to which
the Rights Agent or any successor Rights Agent shall be a party, or any corporation succeeding to the corporate trust business
of the Rights Agent or any successor Rights Agent, shall be the successor to the Rights Agent under this Agreement without the
execution or filing of any paper or any further act on the part of any of the parties hereto; provided, however,
that such corporation would be eligible for appointment as a successor Rights Agent under the provisions of Section 21 hereof.
In case at the time such successor Rights Agent shall succeed to the agency created by this Agreement, any of the Rights Certificates
shall have been countersigned but not delivered, any such successor Rights Agent may adopt the countersignature of the predecessor
Rights Agent and deliver such Rights Certificates so countersigned; and in case at that time any of the Rights Certificates
shall not have been countersigned, any successor Rights Agent may countersign such Rights Certificates either in the name of the
predecessor Rights Agent or in the name of the successor Rights Agent; and in all such cases such Rights Certificates shall
have the full force provided in the Rights Certificates and in this Agreement. In case at any time the name of the Rights Agent
shall be changed and at such time any of the Rights Certificates shall have been countersigned but not delivered, the Rights Agent
may adopt the countersignature under its prior name and deliver Rights Certificates so countersigned; and in case at that
time any of the Rights Certificates shall not have been countersigned, the Rights Agent may countersign such Rights Certificates
either in its prior name or in its changed name; and in all such cases such Rights Certificates shall have the full force
provided in the Rights Certificates and in this Agreement.



    	 	 -29-	 



    	



    

Section 20. Duties
of Rights Agent. The Rights Agent undertakes the duties and obligations imposed by this Agreement upon the following
terms and conditions, by all of which the Company and the holders of Rights Certificates, by their acceptance thereof, shall be
bound:


 


(a)       The
Rights Agent may consult with legal counsel (who may be legal counsel for the Company), and the written advice or opinion of such
counsel shall be full and complete authorization and protection to the Rights Agent as to any action taken or omitted by it in
good faith and in accordance with such written advice or opinion.


 


(b)       Whenever
in the performance of its duties under this Agreement the Rights Agent shall deem it necessary or desirable that any fact or matter
(including, without limitation, the identity of any Acquiring Person and the determination of Current Per Share Market Price) be
proved or established by the Company prior to taking or suffering any action hereunder, such fact or matter (unless other evidence
in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a certificate
signed by any one of the Chairman of the Board, the Chief Executive Officer, the President, any Vice President, the Chief Financial
Officer, the Secretary or any Assistant Secretary of the Company and delivered to the Rights Agent; and such certificate shall
be full authorization to the Rights Agent for any action taken or suffered in good faith by it under the provisions of this Agreement
in reliance upon such certificate.


 


(c)       The
Rights Agent shall be liable hereunder to the Company and any other Person only for its own negligence, bad faith or willful misconduct.


 


(d)       The
Rights Agent shall not be liable for or by reason of any of the statements of fact or recitals contained in this Agreement or in
the Rights Certificates (except its countersignature thereof) or be required to verify the same, but all such statements and recitals
are and shall be deemed to have been made by the Company only.


 


(e)       The
Rights Agent shall not be under any responsibility in respect of the validity of this Agreement or the execution and delivery hereof
(except the due execution hereof by the Rights Agent) or in respect of the validity or execution of any Rights Certificate (except
its countersignature thereof); nor shall it be responsible for any breach by the Company of any covenant or condition contained
in this Agreement or in any Rights Certificate; nor shall it be responsible for any change in the exercisability of the Rights
or any adjustment in the terms of the Rights (including the manner, method or amount thereof) provided for in Sections 3,
11, 13, 23 or 24, or the ascertaining of the existence of facts that would require any such change or adjustment (except with respect
to the exercise of Rights evidenced by Rights Certificates after receipt by the Rights Agent of a certificate furnished pursuant
to Section 12 describing such change or adjustment); nor shall it by any act hereunder be deemed to make any representation
or warranty as to the authorization or reservation of any Preferred Shares to be issued pursuant to this Agreement or any Rights
Certificate or as to whether any Preferred Shares will, when issued, be validly authorized and issued, fully paid and nonassessable.


 


(f)       The
Company agrees that it will perform, execute, acknowledge and deliver or cause to be performed, executed, acknowledged and delivered
all such further and other acts,



    	 	 -30-	 



    	



    

instruments and assurances
as may reasonably be required by the Rights Agent for the carrying out or performing by the Rights Agent of the provisions of this
Agreement.


 


(g)       The
Rights Agent is hereby authorized and directed to accept instructions with respect to the performance of its duties hereunder from
any one of the Chairman of the Board, the Chief Executive Officer, the President, any Vice President, the Chief Financial Officer,
the Secretary or any Assistant Secretary of the Company, and to apply to such officers for advice or instructions in connection
with its duties, and it shall not be liable for any action taken or suffered by it in good faith in accordance with instructions
of any such officer or for any delay in acting while waiting for those instructions. Any application by the Rights Agent for written
instructions from the Company may, at the option of the Rights Agent, set forth in writing any action proposed to be taken or omitted
by the Rights Agent under this Rights Agreement and the date on and/or after which such action shall be taken or such omission
shall be effective. The Rights Agent shall not be liable for any action taken by, or omission of, the Rights Agent in accordance
with a proposal included in any such application on or after the date specified in such application (which date shall not be less
than five (5) Business Days after the date any officer of the Company actually receives such application, unless any such officer
shall have consented in writing to an earlier date) unless, prior to taking any such action (or the effective date in the case
of an omission), the Rights Agent shall have received written instructions in response to such application specifying the action
to be taken or omitted.


 


(h)       The
Rights Agent and any shareholder, director, officer or employee of the Rights Agent may buy, sell or deal in any of the Rights
or other securities of the Company or become pecuniarily interested in any transaction in which the Company may be interested,
or contract with or lend money to the Company or otherwise act as fully and freely as though it were not Rights Agent under this
Agreement. Nothing herein shall preclude the Rights Agent from acting in any other capacity for the Company or for any other legal
entity.


 


(i)       The
Rights Agent may execute and exercise any of the rights or powers hereby vested in it or perform any duty hereunder either itself
or by or through its attorneys or agents, and the Rights Agent shall not be answerable or accountable for any act, default, neglect
or misconduct of any such attorneys or agents or for any loss to the Company resulting from any such act, default, neglect or misconduct,
provided reasonable care was exercised in the selection and continued employment thereof.


 


(j)       No
provision of this Agreement shall require the Rights Agent to expend or risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder or in the exercise of its rights if there shall be reasonable grounds for believing
that repayment of such funds or adequate indemnification against such risk or liability is not reasonably assured to it.


 


(k)       If,
with respect to any Rights Certificate surrendered to the Rights Agent for exercise or transfer, the certificate attached to the
form of assignment or form of election to purchase, as the case may be, has either not been completed or indicates an affirmative
response to clause 1 and/or 2 thereof, the Rights Agent shall not take any further action with respect to such requested exercise
or transfer without first consulting with the Company.



    	 	 -31-	 



    	



    

Section 21. Change
of Rights Agent. The Rights Agent or any successor Rights Agent may resign and be discharged from its duties under this
Agreement upon thirty (30) days’ written notice mailed to the Company and to each transfer agent of the Preferred Shares
and the Common Stock by registered or certified mail, and to the holders of the Rights Certificates by first-class mail. The Company
may remove the Rights Agent or any successor Rights Agent upon thirty (30) days’ written notice, mailed to the Rights Agent
or successor Rights Agent, as the case may be, and to each transfer agent of the Preferred Shares and the Common Stock by registered
or certified mail, and to the holders of the Rights Certificates by first-class mail. If the Rights Agent shall resign or be removed
or shall otherwise become incapable of acting, the Company shall appoint a successor to the Rights Agent. If the Company shall
fail to make such appointment within a period of thirty (30) days after giving notice of such removal or after receiving written
notice of such resignation or incapacity by the resigning or incapacitated Rights Agent or by the holder of a Rights Certificate
(who shall, with such notice, submit his or her Rights Certificate for inspection by the Company), then the registered holder of
any Rights Certificate may apply to any court of competent jurisdiction for the appointment of a new Rights Agent. Any successor
Rights Agent, whether appointed by the Company or by such a court, shall be a corporation organized and doing business under the
laws of the United States or of any state of the United States, in good standing, which is authorized under such laws to exercise
corporate trust or shareholder services powers and is subject to supervision or examination by federal or state authority and which
has at the time of its appointment as Rights Agent a combined capital and surplus of at least U.S.$100 million. After appointment,
the successor Rights Agent shall be vested with the same powers, rights, duties and responsibilities as if it had been originally
named as Rights Agent without further act or deed; but the predecessor Rights Agent shall deliver and transfer to the successor
Rights Agent any property at the time held by it hereunder, and execute and deliver any further assurance, conveyance, act or deed
necessary for the purpose. Not later than the effective date of any such appointment, the Company shall file notice thereof in
writing with the predecessor Rights Agent and each transfer agent of the Preferred Shares and the Common Stock, and mail a written
notice thereof to the registered holders of the Rights Certificates. Failure to give any notice provided for in this Section 21,
however, or any defect therein, shall not affect the legality or validity of the resignation or removal of the Rights Agent or
the appointment of the successor Rights Agent, as the case may be.


 


Section 22. Issuance
of New Rights Certificates. Notwithstanding any of the provisions of this Agreement or of the Rights to the contrary,
the Company may, at its option, issue new Rights Certificates evidencing Rights in such form as may be approved by its Board of
Directors to reflect any adjustment or change in the Exercise Price and the number or kind or class of shares or other securities
or property purchasable under the Rights Certificates made in accordance with the provisions of this Agreement. In addition, in
connection with the issuance or sale of shares of Common Stock following the Distribution Date and prior to the redemption or
expiration of the Rights, the Company (a) shall, with respect to shares of Common Stock so issued or sold pursuant to the
exercise of stock options or under any employee plan or arrangement or upon the exercise, conversion or exchange of other securities
of the Company outstanding at the date hereof or upon the exercise, conversion or exchange of securities hereinafter issued by
the Company and (b) may, in any other case, if deemed necessary or appropriate by the Board of Directors of the Company,
issue Rights Certificates representing the appropriate number of Rights in connection with such issuance or sale; provided,
however, that (i) no such Rights Certificate shall be issued and this sentence shall be null and void ab initio if,
and to the extent that, such



    	 	 -32-	 



    	



    

issuance or this sentence
would create a significant risk of or result in material adverse tax consequences to the Company or the Person to whom such Rights
Certificate would be issued or would create a significant risk of or result in such options’ or employee plans’ or
arrangements’ failing to qualify for otherwise available special tax treatment and (ii) no such Rights Certificate shall
be issued if, and to the extent that, appropriate adjustment shall otherwise have been made in lieu of the issuance thereof.


 


Section 23. Redemption.


 


(a)       The
Company may, at its option and with the approval of the Board, at any time prior to the Close of Business on the earlier of (i) the
close of business on the tenth day following the Shares Acquisition Date and (ii) the Final Expiration Date, redeem all but
not less than all the then outstanding Rights at a redemption price of U.S. $0.01 per Right, appropriately adjusted to reflect
any stock split, stock dividend or similar transaction occurring after the date hereof (such redemption price being herein referred
to as the “Redemption Price”) and the Company may, at its option, pay the Redemption Price either in shares
of Common Stock (based on the Current Per Share Market Price thereof at the time of redemption) or cash. Such redemption of the
Rights by the Company may be made effective at such time, on such basis and with such conditions as the Board in its sole discretion
may establish. The date on which the Board elects to make the redemption effective shall be referred to as the “Redemption
Date”.


 


(b)       Immediately
upon the action of the Board ordering the redemption of the Rights, evidence of which shall have been filed with the Rights Agent,
and without any further action and without any notice, the right to exercise the Rights will terminate and the only right thereafter
of the holders of Rights shall be to receive the Redemption Price. The Company shall promptly give public notice of any such redemption;
provided, however, that the failure to give or any defect in, any such notice shall not affect the validity of such
redemption. Within ten (10) days after the action of the Board ordering the redemption of the Rights, the Company shall give notice
of such redemption to the Rights Agent and the holders of the then outstanding Rights by mailing such notice to all such holders
at their last addresses as they appear upon the registry books of the Rights Agent or, prior to the Distribution Date, on the
registry books of the transfer agent for the Common Stock. Any notice which is mailed in the manner herein provided shall be deemed
given, whether or not the holder receives the notice. Each such notice of redemption will state the method by which the payment
of the Redemption Price will be made. Neither the Company nor any of its Affiliates or Associates may redeem, acquire or purchase
for value any Rights at any time in any manner other than that specifically set forth in this Section 23 or in Section 24
hereof, and other than in connection with the purchase of shares of Common Stock prior to the Distribution Date.


 


Section 24. Exchange.


 


(a)       Subject
to applicable laws, rules and regulations, and subject to subsection 24(c) below, the Company may, at its option, by action of
the Board, at any time after the occurrence of a Triggering Event, exchange all or part of the then outstanding and exercisable
Rights (which shall not include Rights that have become void pursuant to the provisions of Section 7(e) hereof) for shares
of Common Stock at an exchange ratio of one share of Common Stock per Right, appropriately adjusted to reflect any stock split,
stock dividend or similar



    	 	 -33-	 



    	



    

transaction occurring after the date hereof
(such exchange ratio being hereinafter referred to as the “Exchange Ratio”). Notwithstanding the foregoing,
the Board of Directors shall not be empowered to effect such exchange at any time after any Person (other than the Company, any
Subsidiary of the Company, any employee benefit plan of the Company or any such Subsidiary, or any entity holding Common Stock
for or pursuant to the terms of any such plan or an Exempted Person), together with all Affiliates and Associates of such Person,
becomes the Beneficial Owner of 50% or more of the Common Stock then outstanding.


 


(b)       Immediately
upon the action of the Board ordering the exchange of any Rights pursuant to Section 24(a) and without any further action
and without any notice, the right to exercise such Rights shall terminate and the only right thereafter of a holder of such Rights
shall be to receive that number of shares of Common Stock equal to the number of such Rights held by such holder multiplied by
the Exchange Ratio. The Company shall give public notice of any such exchange; provided, however, that the
failure to give, or any defect in, such notice shall not affect the validity of such exchange. The Company shall mail a notice
of any such exchange to all of the holders of such Rights at their last addresses as they appear upon the registry books of the
Rights Agent. Any notice which is mailed in the manner herein provided shall be deemed given, whether or not the holder receives
the notice. Each such notice of exchange will state the method by which the exchange of the shares of Common Stock for Rights
will be effected and, in the event of any partial exchange, the number of Rights which will be exchanged. Any partial exchange
shall be effected pro rata based on the number of Rights (other than Rights which have become void pursuant to the provisions
of Section 7(e) hereof) held by each holder of Rights.


 


(c)       In
the event that there shall not be sufficient shares of Common Stock issued but not outstanding or authorized but unissued to permit
any exchange of Rights as contemplated in accordance with Section 24(a), the Company shall either take such action as may
be necessary to authorize additional shares of Common Stock for issuance upon exchange of the Rights or alternatively, at the option
of a majority of the Board of Directors, with respect to each Right (i) pay cash in an amount equal to the Current Value (as
hereinafter defined), in lieu of issuing shares of Common Stock in exchange therefor, or (ii) issue debt or equity securities
or a combination thereof, having a value equal to the Current Value, in lieu of issuing shares of Common Stock in exchange for
each such Right, where the value of such securities shall be determined by a nationally recognized investment banking firm selected
by majority vote of the Board of Directors, or (iii) deliver any combination of cash, property, shares of Common Stock and/or
other securities having a value equal to the Current Value in exchange for each Right. For purposes of this Section 24(c)
only, the Current Value shall mean the product of the Current Per Share Market Price of shares of Common Stock on the date of the
occurrence of the event described above in subparagraph (a), multiplied by the number of shares of Common Stock for which the Right
otherwise would be exchangeable if there were sufficient shares available. To the extent that the Company determines that some
action need be taken pursuant to clauses (i), (ii) or (iii) of this Section 24(c), the Board of Directors may temporarily
suspend the exercisability of the Rights for a period of up to sixty (60) days following the date on which the event described
in Section 24(a) shall have occurred, in order to seek any authorization of additional shares of Common Stock and/or to decide
the appropriate form of distribution to be made pursuant to the above provision and to determine the value thereof. In the event
of any such suspension, the Company shall issue a public announcement stating that the exercisability of the Rights has been temporarily
suspended.



    	 	 -34-	 



    	



    

(d)       The
Company shall not be required to issue fractions of shares of Common Stock or to distribute certificates which evidence fractional
shares of Common Stock. In lieu of such fractional shares of Common Stock, there shall be paid to the registered holders of the
Rights Certificates with regard to which such fractional shares of Common Stock would otherwise be issuable, an amount in cash
equal to the same fraction of the current market value of a whole share of Common Stock (as determined pursuant to the terms hereof).


 


(e)       The
Company may, at its option, by majority vote of the Board of Directors, at any time before any Person has become an Acquiring Person,
exchange all or part of the then outstanding Rights for rights of substantially equivalent value, as determined reasonably and
with good faith by the Board of Directors, based upon the advice of one or more nationally recognized investment banking firms.


 


(f)       Immediately
upon the action of the Board of Directors ordering the exchange of any Rights pursuant to subsection (e) of this Section 24
and without any further action and without any notice, the right to exercise such Rights shall terminate and the only right thereafter
of a holder of such Rights shall be to receive that number of rights in exchange therefor as has been determined by the Board
of Directors in accordance with subsection (e) above. The Company shall give public notice of any such exchange; provided,
however, that the failure to give, or any defect in, such notice shall not affect the validity of such exchange. The Company
shall mail a notice of any such exchange to all of the holders of such Rights at their last addresses as they appear upon the
registry books of the transfer agent for the shares of Common Stock of the Company. Any notice which is mailed in the manner herein
provided shall be deemed given, whether or not the holder receives the notice. Each such notice of exchange will state the method
by which the exchange of the Rights will be effected.


 


Section 25. Notice
of Certain Events.


 


(a)       In
case any Triggering Event or Section 13 Event shall occur, then, in any such case, the Company shall as soon as practicable
thereafter give to each holder of a Rights Certificate, in accordance with Section 26 hereof, a notice of the occurrence of
such event, which shall specify the event and the consequences of the event to holders of Rights under Sections 11(a)(ii)
and 13 hereof.


 


Section 26. Notices.
Notices or demands authorized by this Agreement to be given or made by the Rights Agent or by the holder of any Rights Certificate
to or on the Company shall be sufficiently given or made if sent by first-class mail, postage prepaid, addressed (until another
address is filed in writing with the Rights Agent) as follows:


 


Safe Bulkers, Inc.

Apt. D11

Les Acanthes

5, Avenue des Citronniers

MC 98000 Monaco


 


Attention: Chief Executive Officer



    	 	 -35-	 



    	



    

with a copy to:



Cadwalader, Wickersham & Taft LLP

200 Liberty Street

New York, New York 10281


 


Attention: Richard Brand and Joshua
Apfelroth


 


Subject to the provisions of Section 21
hereof, any notice or demand authorized by this Agreement to be given or made by the Company or by the holder of any Rights Certificate
to or on the Rights Agent shall be sufficiently given or made if sent by first- class mail, postage prepaid, addressed (until another
address is filed in writing with the Company) as follows:


 


American Stock Transfer & Trust
Company

6201 15th Avenue

Brooklyn, New York 11219

Attention: General Counsel


 


Notices or demands authorized by this Agreement
to be given or made by the Company or the Rights Agent to the holder of any Rights Certificate shall be sufficiently given or made
if sent by first class mail, postage prepaid, addressed to such holder at the address of such holder as shown on the registry books
of the Company.


 


Section 27. Supplements
and Amendments. Prior to the occurrence of a Distribution Date, the Company may supplement or amend this Agreement in
any respect without the approval of any holders of Rights and the Rights Agent shall, if the Company so directs, execute such supplement
or amendment. From and after the occurrence of a Distribution Date, the Company and the Rights Agent may from time to time supplement
or amend this Agreement without the approval of any holders of Rights in order to (i) cure any ambiguity or omission, (ii) correct
or supplement any provision contained herein which may be defective or inconsistent with any other provisions herein, (iii) shorten
or lengthen any time period hereunder or (iv) change or supplement the provisions hereunder in any manner that the Company
may deem necessary or desirable and that shall not adversely affect the interests of the holders of Rights (other than an Acquiring
Person or an Affiliate or Associate of an Acquiring Person); provided, this Agreement may not be supplemented or amended to
lengthen, pursuant to clause (iii) of this sentence, (A) a time period relating to when the Rights may be redeemed at such
time as the Rights are not then redeemable or (B) any other time period unless such lengthening is for the purpose of protecting,
enhancing or clarifying the rights of, and/or the benefits to, the holders of Rights (other than an Acquiring Person or an Affiliate
or Associate of an Acquiring Person). Upon the delivery of a certificate from an appropriate officer of the Company that states
that the proposed supplement or amendment is in compliance with the terms of this Section 27, the Rights Agent shall execute
such supplement or amendment. Prior to the Distribution Date, the interests of the holders of Rights shall be deemed coincident
with the interests of the holders of shares of Common Stock.


 


Section 28. Successors.
All the covenants and provisions of this Agreement by or for the benefit of the Company or the Rights Agent shall bind and inure
to the benefit of their respective successors and assigns hereunder.



    	 	 -36-	 



    	



    

Section 29. Determinations
and Actions by the Board of Directors, etc. The Board of Directors of the Company shall have the exclusive power and
authority to administer this Agreement and to exercise all rights and powers specifically granted to the Board, or the Company,
or as may be necessary or advisable in the administration of this Agreement, including, without limitation, the right and power
to (i) interpret the provisions of this Agreement and (ii) make all determinations deemed necessary or advisable for
the administration of this Agreement (including a determination to redeem or not redeem the Rights or to amend the Agreement).
All such actions, calculations, interpretations and determinations (including, for purposes of clause (y) below, all omissions
with respect to the foregoing) which are done or made by the Board in good faith, shall (x) be final, conclusive and binding
on the Company, the Rights Agent, the holders of the Rights Certificates and all other parties and (y) not subject the Board
to any liability to the holders of the Rights.


 


Section 30. Benefits
of this Agreement. Nothing in this Agreement shall be construed to give to any Person other than the Company, the Rights
Agent and the registered holders of the Rights Certificates (and, prior to the Distribution Date, the shares of Common Stock) any
legal or equitable right, remedy or claim under this Agreement; but this Agreement shall be for the sole and exclusive benefit
of the Company, the Rights Agent and the registered holders of the Rights Certificates (and, prior to the Distribution Date, the
shares of Common Stock).


 


Section 31. Severability.
If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other authority
to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall
remain in full force and effect and shall in no way be affected, impaired or invalidated; provided, however,
that notwithstanding anything in this Agreement to the contrary, if any such term, provision, covenant or restriction is held
by such court or authority to be invalid, void or unenforceable and the Board of Directors of the Company determines in its good
faith judgment that severing the invalid language from this Agreement would adversely affect the purpose or effect of this Agreement,
the right of redemption set forth in Section 23 hereof shall be reinstated and shall not expire until the Close of Business
on the tenth day following the date of such determination by the Board of Directors.


 


Section 32. Governing
Law. This Agreement and each Right and each Rights Certificate issued hereunder shall be deemed to be a contract made
under the laws of New York and for all purposes shall be governed by and construed in accordance with the laws of such jurisdiction
applicable to contracts to be made and performed entirely within such jurisdiction.


 


Section 33. Counterparts.
This Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and the same instrument.


 


Section 34. Descriptive
Headings. Descriptive headings of the several Sections of this Agreement are inserted for convenience only and shall
not control or affect the meaning or construction of any of the provisions hereof.


 


REMAINDER OF PAGE INTENTIONALLY LEFT
BLANK



    	 	 -37-	 



    	



    

IN WITNESS WHEREOF, the parties have executed
this Shareholders Rights Agreement as of the date first written above.


 


	 	SAFE BULKERS, INC.,
	 	 
	 	by	/s/ Loukas Barmparis
	 	 	Name:   Dr. Loukas Barmparis
	 	 	Title:      President and Secretary
	 	 
	 	AMERICAN STOCK TRANSFER & TRUST COMPANY,
	 	 
	 	by	/s/ Michael A. Nespoli
	 		Name:   Michael A. Nespoli
	 	 	Title:      Executive Director


 


[Signature Page to Shareholders Rights
Agreement]



    	 		 



    	






Exhibit A


 


STATEMENT OF DESIGNATION OF RIGHTS, PREFERENCES
AND PRIVILEGES OF

SERIES A PARTICIPATING PREFERRED STOCK OF SAFE BULKERS, INC.


 


The undersigned, Polys
Hajioannou and Dr. Loukas Barmparis do hereby certify:


 


1. That Polys Hajioannou
is the duly elected and acting Chief Executive Officer and Dr. Loukas Barmparis is the duly elected and acting President and Secretary
of Safe Bulkers, Inc., a Marshall Islands corporation (the “Company”).


 


2. That pursuant to the
authority conferred by the Company’s Amended and Restated Articles of Incorporation, the Company’s Board of Directors
on August 5, 2020 adopted the following resolution designating and prescribing the relative rights, preferences and limitations
of the Company’s Series A Participating Preferred Stock:


 


RESOLVED, that pursuant
to the authority vested in the Board of Directors (the “Board”) of the Company by the Articles of Incorporation,
the Board hereby establishes a series of preferred stock, par value U.S. $0.01 per share, and fixes the designation and certain
powers, preferences and other special rights of the shares of such series, and certain qualifications, limitations and restrictions
thereon, as follows:


 


Section 1. Designation
and Amount. The shares of such series shall be designated as “Series A Participating Preferred Stock”. The
Series A Participating Preferred Stock shall have a par value of U.S. $0.01 per share, and the number of shares constituting such
series shall initially be 1,000,000, which number the Board may from time to time increase or decrease (but not below the number
then outstanding).


 


Section 2. Proportional
Adjustment. In the event the Company shall at any time after the issuance of any share or shares of Series A Participating
Preferred Stock (i) declare any dividend on the common stock of the Company, par value U.S. $0.001 per share (the “Common
Stock”), payable in shares of Common Stock, (ii) subdivide the outstanding Common Stock or (iii) combine the
outstanding Common Stock into a smaller number of shares, then in each such case the Company shall simultaneously effect a proportional
adjustment to the number of outstanding shares of Series A Participating Preferred Stock.


 


Section 3. Dividends
and Distributions.


 


(a) Subject to the
prior and superior right of the holders of any shares of any series of preferred stock ranking prior and superior to the shares
of Series A Participating Preferred Stock with respect to dividends, the holders of shares of Series A Participating Preferred
Stock shall be entitled to receive when, as and if declared by the Board out of funds legally available for the purpose, quarterly
dividends payable in cash on the last day of March, June, September and December in each year (each such date being referred to
herein as a “Quarterly Dividend Payment Date”), commencing on the first Quarterly Dividend Payment Date after
the first issuance of a share or fraction of a share of Series A Participating Preferred Stock, in an amount per share (rounded
to the nearest cent) equal to 1,000 times the aggregate per share amount of all cash



    	A-1



    	



    


 dividends, and 1,000 times the aggregate
per share amount (payable in kind) of all non cash dividends or other distributions other than a dividend payable in shares of
Common Stock or a subdivision of the outstanding shares of Common Stock (by reclassification or otherwise), declared on the Common
Stock since the immediately preceding Quarterly Dividend Payment Date, or, with respect to the first Quarterly Dividend Payment
Date, since the first issuance of any share or fraction of a share of Series A Participating Preferred Stock.


 


(b) The Company
shall declare a dividend or distribution on the Series A Participating Preferred Stock as provided in paragraph (a) above immediately
after it declares a dividend or distribution on the Common Stock (other than a dividend payable in shares of Common Stock).


 


(c) Dividends shall
begin to accrue on outstanding shares of Series A Participating Preferred Stock from the Quarterly Dividend Payment Date immediately
preceding the date of issue of such shares of Series A Participating Preferred Stock, unless the date of issue of such shares is
prior to the record date for the first Quarterly Dividend Payment Date, in which case dividends on such shares shall begin to accrue
from the date of issue of such shares, or unless the date of issue is a Quarterly Dividend Payment Date or is a date after the
record date for the determination of holders of shares of Series A Participating Preferred Stock entitled to receive a quarterly
dividend and before such Quarterly Dividend Payment Date, in either of which events such dividends shall begin to accrue from such
Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not bear interest. Dividends paid on the shares of Series A
Participating Preferred Stock in an amount less than the total amount of such dividends at the time accrued and payable on such
shares shall be allocated pro rata on a share by share basis among all such shares at the time outstanding. The Board may fix a
record date for the determination of holders of shares of Series A Participating Preferred Stock entitled to receive payment of
a dividend or distribution declared thereon, which record date shall be no more than 30 days prior to the date fixed for the payment
thereof.


 


Section 4. Voting
Rights. The holders of shares of Series A Participating Preferred Stock shall have the following voting rights:


 


(a) Each share of
Series A Participating Preferred Stock shall entitle the holder thereof to 1,000 votes on all matters submitted to a vote of the
shareholders of the Company.


 


(b) Except as otherwise
provided herein or required by law, the holders of shares of Series A Participating Preferred Stock and the holders of shares of
Common Stock shall vote together as one class on all matters submitted to a vote of shareholders of the Company.


 


(c) Except as otherwise
provided herein or required by law, holders of Series A Participating Preferred Stock shall have no special voting rights and their
consent shall not be required (except to the extent they are entitled to vote with holders of Common Stock as set forth herein)
for taking any corporate action.


 


Section 5. Certain
Restrictions.


 


(a) The Company
shall not declare any dividend on, make any distribution on, or redeem or purchase or otherwise acquire for consideration any shares
of Common Stock after the



    	A-2



    	



    


first issuance of a share or fraction of
a share of Series A Participating Preferred Stock unless concurrently therewith it shall declare a dividend on, make a distribution
on, or redeem or purchase or otherwise acquire for consideration the Series A Participating Preferred Stock as required by Section 3
hereof.


 


(b) Whenever quarterly
dividends or other dividends or distributions payable on the Series A Participating Preferred Stock as provided in Section 3
are in arrears, thereafter and until all accrued and unpaid dividends and distributions, whether or not declared, on shares of
Series A Participating Preferred Stock outstanding shall have been paid in full, the Company shall not (i) declare or pay
dividends on, make any other distributions on, or redeem or purchase or otherwise acquire for consideration any shares of stock
ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Participating Preferred
Stock; (ii) declare or pay dividends on, make any other distributions on any shares of stock ranking on a parity (either
as to dividends or upon liquidation, dissolution or winding up) with Series A Participating Preferred Stock, except dividends paid
ratably on the Series A Participating Preferred Stock and all such parity stock on which dividends are payable or in arrears in
proportion to the total amounts to which the holders of all such shares are then entitled; (iii) redeem or purchase or
otherwise acquire for consideration shares of any stock ranking on a parity (either as to dividends or upon liquidation, dissolution
or winding up) with the Series A Participating Preferred Stock, provided that the Company may at any time redeem, purchase
or otherwise acquire shares of any such parity stock in exchange for shares of any stock of the Company ranking junior (either
as to dividends or upon dissolution, liquidation or winding up) to the Series A Participating Preferred Stock; (iv) purchase
or otherwise acquire for consideration any shares of Series A Participating Preferred Stock, or any shares of stock ranking on
a parity with the Series A Participating Preferred Stock, except in accordance with a purchase offer made in writing or by publication
(as determined by the Board) to all holders of such shares upon such terms as the Board, after consideration of the respective
annual dividend rates and other relative rights and preferences of the respective series and classes, shall determine in good faith
will result in fair and equitable treatment among the respective series or classes.


 


(c) The Company
shall not permit any subsidiary of the Company to purchase or otherwise acquire for consideration any shares of stock of the Company
unless the Company could, under paragraph (a) of this Section 5, purchase or otherwise acquire such shares at such time and
in such manner.


 


Section 6. Reacquired
Shares. Any shares of Series A Participating Preferred Stock purchased or otherwise acquired by the Company in any manner whatsoever
shall be retired and canceled promptly after the acquisition thereof. All such shares shall upon their cancellation become authorized
but unissued shares of preferred stock and may be reissued as part of a new series of preferred stock to be created by resolution
or resolutions of the Board, subject to the conditions and restrictions on issuance set forth herein and, in the Articles of Incorporation,
as then amended.


 


Section 7. Liquidation,
Dissolution or Winding Up. Upon any liquidation, dissolution or winding up of the Company, the holders of shares of Series
A Participating Preferred Stock shall be entitled to receive an aggregate amount per share equal to 1,000 times the aggregate 



    	A-3



    	



    


amount to be distributed per share to
holders of shares of Common Stock plus an amount equal to any accrued and unpaid
dividends on such shares of Series A Participating Preferred Stock.


 


Section 8. Consolidation,
Merger, etc. In case the Company shall enter into any consolidation, merger, combination or other transaction in which the
shares of Common Stock are exchanged for or changed into other stock or securities, cash and/or any other property, then in any
such case the shares of Series A Participating Preferred Stock shall at the same time be similarly exchanged or changed in an amount
per share equal to 1,000 times the aggregate amount of stock, securities, cash and/or any other property (payable in kind), as
the case may be, into which or for which each share of Common Stock is changed or exchanged.


 


Section 9. No
Redemption. The shares of Series A Participating Preferred Stock shall not be redeemable.


 


Section 10. Ranking.
The Series A Participating Preferred Stock shall rank junior to all other series of the Company’s preferred stock as to the
payment of dividends and the distribution of assets, unless the terms of any such series shall provide otherwise.


 


Section 11. Amendment.
The Articles of Incorporation of the Company shall not be further amended in any manner which would materially alter or change
the powers, preference or special rights of the Series A Participating Preferred Stock so as to affect them adversely without the
affirmative vote of the holders of a majority of the outstanding shares of Series A Participating Preferred Stock, voting separately
as a class.


 


Section 12. Fractional
Shares. Series A Participating Preferred Stock may be issued in fractions of a share which shall entitle the holder, in proportion
to such holder’s fractional shares, to exercise voting rights, receive dividends, participate in distributions and to have
the benefit of all other rights of holders of Series A Participating Preferred Stock.


 


RESOLVED FURTHER, that
the Board hereby authorizes and directs the President or any Vice President and the Secretary or any Assistant Secretary of this
Company to prepare and file a Statement of Designation of Rights, Preferences and Privileges in accordance with the foregoing resolution
and the provisions of Marshall Islands law and to take such actions as they may deem necessary or appropriate to carry out the
intent of the foregoing resolution.


 


REMAINDER OF PAGE INTENTIONALLY LEFT
BLANK



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We further declare, under
penalty of perjury, that the foregoing Statement of Designation is the act and deed of the Company and that the facts stated therein
are true and correct.


 


Executed at ______ on
August 6, 2020.


 


	 
	Chief Executive Officer

Polys Hajioannou



 





	 
	President and Secretary

Loukas Barmparis




    	A-5



    	



    


Exhibit B


 


FORM OF RIGHTS CERTIFICATE


 


	Certificate No. R-___	___ Rights



 


NOT EXERCISABLE AFTER AUGUST 5, 2030 OR
EARLIER IF REDEMPTION OR EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $0.01 PER RIGHT AND TO EXCHANGE ON THE TERMS
SET FORTH IN THE AGREEMENT.


 


Rights Certificate


 


Safe Bulkers, Inc.


 


This certifies that _______________,
or registered assigns, is the registered owner of the number of Rights set forth above, each of which entitles the owner thereof,
subject to the terms, provisions and conditions of the Shareholders Rights Agreement, dated as of August 5, 2020 (the “Agreement”),
between Safe Bulkers, Inc., a Marshall Islands corporation (the “Company”), and American Stock Transfer &
Trust Company, as Rights Agent (the “Rights Agent”), to purchase from the Company at any time after the Distribution
Date (as such term is defined in the Agreement) and prior to 5:00 p.m., New York time, on August 5, 2030 at the principal
office of the Rights Agent, or at the office of its successor as Rights Agent, one one-thousandth of a fully paid non-assessable
share of Series A Participating Preferred Stock, par value U.S. $0.01 per share, of the Company (the “Preferred Shares”),
at an exercise price of U.S. $5.20 per one one-thousandth of a Preferred Share (the “Exercise Price”), upon
presentation and surrender of this Rights Certificate with the Form of Election to Purchase duly executed. The number of Rights
evidenced by this Rights Certificate (and the number of one one-thousandths of a Preferred Share which may be purchased upon exercise
hereof) set forth above, and the Exercise Price set forth above, are the number and Exercise Price as of August 5, 2020, based
on the Preferred Shares as constituted at such date. As provided in the Agreement, the Exercise Price and the number of one one-thousandths
of a Preferred Share which may be purchased upon the exercise of the Rights evidenced by this Rights Certificate are subject to
modification and adjustment upon the happening of certain events.


 


This Rights Certificate
is subject to all of the terms, provisions and conditions of the Agreement, which terms, provisions and conditions are hereby incorporated
herein by reference and made a part hereof and to which Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the Rights Agent, the Company and the holders of the Rights
Certificates. Copies of the Agreement are on file at the principal executive offices of the Company and the offices of the Rights
Agent.


 


This Rights Certificate,
with or without other Rights Certificates, upon surrender at the principal office of the Rights Agent, may be exchanged for another
Rights Certificate or Rights Certificates of like tenor and date evidencing Rights entitling the holder to purchase a like aggregate
number of Preferred Shares as the Rights evidenced by the Rights Certificate or Rights Certificates surrendered shall have entitled
such holder to purchase. If this Rights Certificate shall



    	B-1



    	



    


 be exercised in part, the holder
shall be entitled to receive upon surrender hereof another Rights Certificate or Rights Certificates for the number of whole Rights
not exercised.


 


Subject to the provisions
of the Agreement, the Rights evidenced by this Rights Certificate (i) may be redeemed by the Company at a redemption price
of $0.01 per Right or (ii) may be exchanged in whole or in part for shares of the Company’s Common Stock, par value
$0.001 per share.


 


No fractional Preferred
Shares will be issued upon the exercise of any Right or Rights evidenced hereby (other than fractions which are integral multiples
of one one-thousandth of a Preferred Share, which may, at the election of the Company, be evidenced by depositary receipts), but,
in lieu thereof, a cash payment will be made, as provided in the Agreement.


 


No holder of this Rights
Certificate shall be entitled to vote or receive dividends or be deemed for any purpose the holder of the Preferred Shares or of
any other securities of the Company which may at any time be issuable on the exercise hereof, nor shall anything contained in the
Agreement or herein be construed to confer upon the holder hereof, as such, any of the rights of a shareholder of the Company or
any right to vote for the election of directors or upon any matter submitted to shareholders at any meeting thereof, or to give
or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting shareholders (except as
provided in the Agreement), or to receive dividends or subscription rights, or otherwise, until the Right or Rights evidenced by
this Rights Certificate shall have been exercised as provided in the Agreement.


 


This Rights Certificate
shall not be valid or obligatory for any purpose until it shall have been countersigned by the Rights Agent.



    	B-2



    	



    


WITNESS the facsimile
signature of the proper officers of the Company and its corporate seal. Dated as of _________, 20__.


 





	 	SAFE BULKERS, INC.
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:




 


ATTEST:


 


	By:	 	 
	 	Name:	 
	 	Title:	 



 


Countersigned:


 


AMERICAN STOCK TRANSFER & TRUST
COMPANY


 


	By:	 	 
	 	Name:	 
	 	Title:	 




    	B-3



    	



    


Form of Reverse Side of Rights Certificate


 


FORM OF ASSIGNMENT


 


(To be executed by the registered holder
if such

holder desires to transfer the Rights Certificate.)


 


FOR VALUE RECEIVED ___________________
hereby sells, assigns and transfers unto __________________


 


 


(Please print name and address of transferee)


 


 


this Rights Certificate, together with
all right, title and interest therein, and does hereby irrevocably constitute and appoint ____________________ Attorney, to transfer
the within Rights Certificate on the books of the within-named Company, with full power of substitution.


 


Date: ___________


 





	 	Signature




 


Signature Guaranteed:


 


Signatures must be guaranteed by a member
or participant in the Securities Transfer Agent Medallion Program, the New York Stock Exchange Medallion Signature Program or the
Stock Exchanges Medallion Program.


 


The undersigned hereby
certifies that the Rights evidenced by this Rights Certificate are not Beneficially Owned by an Acquiring Person or an Affiliate
or Associate thereof and after due inquiry and to the best knowledge of the undersigned, the undersigned did not acquire the Rights
evidenced by this Rights Certificate from any Person who is, was or subsequently became an Acquiring Person or an Affiliate or
Associate thereof (each as defined in the Agreement).


 


	 	Signature




    	B-4



    	



    


Form of Reverse Side of Rights Certificate
– continued


 


FORM OF ELECTION TO PURCHASE


 


(To be executed if holder desires to exercise

Rights represented by the Rights Certificate.)


 


To: SAFE BULKERS, INC.


 


The undersigned hereby
irrevocably elects to exercise __________ Rights represented by this Rights Certificate to purchase the Preferred Shares issuable
upon the exercise of such Rights and requests that certificates for such Preferred Shares be issued in the name of:


 


Please insert social security or other identifying number


 


(Please print name and address)


 


 


If such number of Rights shall not be all
the Rights evidenced by this Rights Certificate, a new Rights Certificate for the balance remaining of such Rights shall be registered
in the name of and delivered to:


 


Please insert social security or other identifying number


 


(Please print name and address)


 


 


Dated: __________


 


	 	Signature



 


Signature Guaranteed:


 


Signatures must be guaranteed
by a member or participant in the Securities Transfer Agent Medallion Program, the New York Stock Exchange Medallion Signature
Program or the Stock Exchanges Medallion Program.



    	B-5



    	



    


The undersigned hereby
certifies that the Rights evidenced by this Rights Certificate are not Beneficially Owned by an Acquiring Person or an Affiliate
or Associate thereof and after due inquiry and to the best knowledge of the undersigned, the undersigned did not acquire the Rights
evidenced by this Rights Certificate from any Person who is, was or subsequently became an Acquiring Person or an Affiliate or
Associate thereof (each as defined in the Agreement).


 


	 	Signature


 


NOTICE


 


The signature in the
Form of Assignment or Form of Election to Purchase, as the case may be, must conform to the name as written upon the face of this
Rights Certificate in every particular, without alteration or enlargement or any change whatsoever.


 


In the event the certification
set forth above in the Form of Assignment or the Form of Election to Purchase, as the case may be, is not completed, the Company
and the Rights Agent will deem the Beneficial Owner of the Rights evidenced by this Rights Certificate to be an Acquiring Person
or an Affiliate or Associate thereof (each as defined in the Agreement) and such Assignment or Election to Purchase will not be
honored.



    	B-6



    	



    


Exhibit C


 


SUMMARY OF RIGHTS


 


	Distribution and Transfer of Rights:	 
	Distribution Date:	The rights will separate from the common stock and become exercisable after (1) the tenth day after a person or group acquires ownership of 10% or more of the company’s common stock or (2) the 10th business day (or such later date as determined by the company’s board of directors) after a person or group announces a tender or exchange offer which would result in that person or group holding 10% or more of the company’s common stock
	Preferred Stock Purchasable Upon

Exercise of Rights:	On the Distribution Date, each holder of a right will be entitled to purchase for U.S. $5.20 (the “Exercise Price”) a fraction (1/1000th) of one share of the company’s preferred stock which has similar economic terms as one share of common stock.
	Flip-in:	If an acquiring person (an “Acquiring Person”) acquires more than 10% of the company’s common stock then each holder of a right (except that acquiring person) will be entitled to buy at the Exercise Price, a number of shares of the company’s common stock which has a then current market value of twice the Exercise Price.
	Flip-over:	If after an Acquiring Person acquires more than 10% of the company’s common stock, the company merges into another company (either as the surviving corporation or as the disappearing entity) or the company sells more than 50% of its assets or earning power, then each holder of a right (except for those owned by the Acquiring Person) will be entitled to purchase at the Exercise Price, a number of shares of common stock of the surviving entity which has a then current market value of twice the Exercise Price.




    	C-1



    	



    


	Exchange Provision:	Any time after the date an Acquiring Person obtains more than 10% of the company’s common stock and before that Acquiring Person acquires more than 50% of the company’s outstanding common stock, the company may exchange each right owned by all other rights holders, in whole or in part, for one share of the company’s common stock.
	Redemption of Rights:	The company can redeem the rights at any time prior to the tenth day following a public announcement that a person has acquired ownership of 10% or more of the company’s common stock.
	Expiration of Rights:	The rights expire on the earliest of (1) August 5, 2030 or (2) the exchange or redemption of the rights as described above.
	Amendment of Terms of Rights:	The terms of the rights and the Shareholder Rights Plan may be amended without the consent of the rights holders at any time on or prior to the Distribution Date.  After the Distribution Date, the terms of the rights and the Shareholder Rights Plan may be amended to make changes, which do not adversely affect the rights of the rights holders (other than the Acquiring Person).
	Voting Rights:	The rights will not have any voting rights.
	Anti-dilution Provisions:	The rights will have the benefit of certain customary anti-dilution protection.




    	C-2