Exhibit 4.20

Private & confidential

Dated: 30th June, 2008

SAFE BULKERS INC.

- to -

|                                         
|-----------------------------------------
|DEUTSCHE  SCHIFFSBANK  AKTIENGESELLSCHAFT

|                       
|-----------------------
|                       
|GUARANTEE AND INDEMNITY
|                       
|                       

Theo V. Siofas & Co.
Law Offices
Piraeus

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TABLE OF CONTENTS

|       |  |                                        |  |     
|------ |  | -------------------------------------- |  | ----
|CLAUSE |  | HEADINGS                               |  | PAGE
|       |  |                                        |  |     
|       |  |                                        |  |     
|1.     |  | DEFINITIONS
 AND INTERPRETATION        |  | 2   
|2.     |  | REPRESENTATIONS
 AND WARRANTIES        |  | 5   
|3.     |  | GUARANTEE
 AND INDEMNITY               |  | 7   
|4.     |  | PRESERVATION
 OF GUARANTORS LIABILITY |  | 7   
|5.     |  | PRESERVATION
 OF BANKS RIGHTS         |  | 8   
|6.     |  | UNDERTAKINGS                           |  | 10  
|7.     |  | PAYMENTS                               |  | 12  
|8.     |  | CURRENCY                               |  | 13  
|9.     |  | SET-OFF                                |  | 13  
|10.    |  | APPLICATION
 OF MONEYS                 |  | 14  
|11.    |  | PARTIAL
 INVALIDITY                    |  | 14  
|12.    |  | FURTHER
 ASSURANCE                     |  | 14  
|13.    |  | MISCELLANEOUS                          |  | 15  
|14.    |  | NOTICES                                |  | 15  
|15.    |  | COUNTERPARTS                           |  | 15  
|16.    |  | LAW AND
 JURISDICTION                  |  | 15  

| |                                 |                          
| | ------------------------------- | -------------------------
| | Schedule 1                     
| |                                 |                          
| | Form of
 Compliance Certificate
| |                                
| | Exhibits                       
| |                                 |                          
| | A                             | Form of Loan
 Agreement  
| |                                 |                          
| | B                             | Form of
 Master Agreement

2

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GUARANTEE AND INDEMNITY

Dated: 30th
June, 2008

BY:

|    |                                                                                                                                                                                                                                             
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | SAFEBULKERS INC., a
company incorporated
according to the law of the Republic of Marshall Islands whose registered
office is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro,
Marshall Islands MI-I 96960 (the Guarantor)

IN FAVOUR OF:

|    |                                                                                                                                                                      
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | DEUTSCHE
SCHIFFSBANK AKTIENGESELLSCHAFT,
Bremen and Hamburg, acting through
its office in Bremen, Domshof 17, 28195 Bremen, Federal Republic of Germany (the
Bank).

WHEREAS:

|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(A) | The Bank has
agreed to lend to STALOUDI
SHIPPING CORPORATION,
of Liberia (the Borrower) an amount of up to Fifty six million six hundred thousand Dollars
($56,600,000) (the Loan) on the terms and subject to the
conditions set out in a secured loan agreement dated 30th June 2007 made between the Bank (as
lender) and the Borrower (as borrower) (the said loan agreement as amended,
supplemented, replaced and/or novated from time to time hereinafter called
the Loan Agreement and
a copy of which in final form is attached hereto as Exhibit A and made an
integral part hereof).
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(B) | Pursuant to
 a Master Agreement (the Master Agreement) dated 30th
 June, 2008 and
 made between the Bank and the Borrower, the Borrower may, for the purpose of
 managing interest rate risks, request the Bank to enter into Financial
 Derivatives Transactions (Rahmenvertrag für Finanztermingeschäfte) in such
 form as the Bank may approve (the Deutscher Rahmenvertrag) with the Bank (a copy of final form of
 which Master Agreement, is attached hereto as Exhibit B and made an integral part hereof).                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(C) | Pursuant to the
 Loan Agreement, and as a condition precedent to the obligation of the Bank to make the Loan available to the
 Borrower and/or to the Bank permitting the Borrower to effect any Transaction
 under the Master Agreement, the Borrower has, amongst other things, agreed to
 procure that the Guarantor execute and deliver this Guarantee and Indemnity in
 favour of the Bank.                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(D) | This
 Guarantee and Indemnity is given by the Guarantor in favour of the Bank by
 way of security for all monies now or hereafter due or payable by the
 Borrower to the Bank under or pursuant to the Loan Agreement and the Master Agreement.                                                                                                                                                                                                                                                                                                                                                      

1

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THIS DEED
WITNESSES as follows:

|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                            
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1.  | DEFINITIONS AND INTERPRETATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                            
|1.1 | In this
 Guarantee and Indemnity:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                            
|    | Accounting Information
 means the annual audited consolidated financial statements of the Guarantor
 and the interim semi-annual un-audited financial statements of the Guarantor,
 to be provided by the Borrower to the Bank in accordance with Clause 14.5 of
 the Loan Agreement;                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                            
|    | Compliance Certificatemeans acertificate substantially in the form
 set out in schedule 1 signed by two (2) directors of the Borrower;                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                            
|    | Consolidated Group Leveragemeans at any
 relevant time Consolidated Total Liabilities divided by Consolidated Total
 Assets;                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                            
|    | Consolidated Total Assetsmeans, at any
 date, the aggregate of:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                            
|    | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | the then
 current market values of all vessels owned by any member of the Group (in the
 case of the Vessel or any other vessel, the market value shall be determined
 by reference only to the most recent valuation of such Vessel or vessel in
 accordance with Clause 10.03 of the Loan Agreement);                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                            
|    | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | the then
 current aggregate amount of cash, Marketable Securities (but no other bonds,
 notes or bills and less any cash or Marketable Securities accounted for in
 the definition of Consolidated Total Liabilities below) and receivables due
 to the Group (less provision for bad and doubtful debts) as shown in the
 latest financial statements; and
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                            
|    | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | the book
 values of all other assets (other than the assets referred to in
 sub-paragraphs (a) and (b) hereof) as shown in such latest financial
 statements;                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                            
|    | Consolidated Total Liabilitiesmeans, at
 the relevant date and for a particular period, the aggregate of the
 consolidated Financial Indebtedness of the Group shown in the latest
 consolidated financial statements for the Group (excluding (i) liabilities to
 its shareholders, provided
 that they are subordinated on terms acceptable to the Bank in its discretion
 and (ii) debt that is fully collateralised by cash or Marketable Securities
 to which the right of access, use or dealing is blocked for any member of the
 Group solely to secure that debt);
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                            
|    | Current Shareholdersmeans the
 shareholders of the Guarantor who beneficially hold directly or indirectly
 not less than fifty one per cent (51%) of the shares in the Guarantor on the
 (date of the Listing;                                                                                                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                            
|    | Debtmeans the aggregate (as of the date
 of calculation) of all obligations
 of the Group then outstanding for the payment or repayment of Financial
 Indebtedness                                                                                                                                                                                                                                                                                                                                                                                                         

2

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| |                                                                                                                                                                                                             |                                                                                                                                                                                                                                    
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | as stated in
 the Accounting Information then most recently required to be delivered
 pursuant to Clause 14.5 including, without limitation:                                                               
| |                                                                                                                                                                                                             |                                                                                                                                                                                                                                    
| | (a)                                                                                                                                                                                                         | any amounts
 payable by the Group under leases, including, but not limited to, time
 chartering contracts, or similar arrangements over their respective periods;                                                                  
| |                                                                                                                                                                                                             |                                                                                                                                                                                                                                    
| | (b)                                                                                                                                                                                                         | any credit
 to the Group from a supplier of goods or under any installment purchase or
 other similar arrangement;                                                                                                                 
| |                                                                                                                                                                                                             |                                                                                                                                                                                                                                    
| | (c)                                                                                                                                                                                                         | the
 aggregate amount then outstanding of liabilities and obligations of third
 parties to the extent that they are guaranteed by the Group;                                                                                       
| |                                                                                                                                                                                                             |                                                                                                                                                                                                                                    
| | (d)                                                                                                                                                                                                         | any
 contingent liabilities (including any taxes or other payments under dispute
 or arbitration) which have been or, under GAAP, should be recorded in the
 notes to the Groups financial statements; and                        
| |                                                                                                                                                                                                             |                                                                                                                                                                                                                                    
| | (e)                                                                                                                                                                                                         | any deferred
 tax liabilities;                                                                                                                                                                                                     
| |                                                                                                                                                                                                             |                                                                                                                                                                                                                                    
| | Default Rate
 means interest at the rate calculated in accordance with clause 5.7 of the
 Loan Agreement;                                                                                                
| |                                                                                                                                                                                                             |                                                                                                                                                                                                                                    
| | EBITDA on a
 consolidated basis of the Group means the earnings before interest, expenses
 and other financial charges, taxes, depreciation and amortization (for the
 previous period of twelve months);
| |                                                                                                                                                                                                             |                                                                                                                                                                                                                                    
| | Financial Indebtedness
 means any obligation for the payment or repayment of money, whether present
 or future, actual or contingent, in respect of:                                                     
| |                                                                                                                                                                                                             |                                                                                                                                                                                                                                    
| | (a)                                                                                                                                                                                                         | moneys
 borrowed;                                                                                                                                                                                                                  
| |                                                                                                                                                                                                             |                                                                                                                                                                                                                                    
| | (b)                                                                                                                                                                                                         | any
 acceptance credit;                                                                                                                                                                                                            
| |                                                                                                                                                                                                             |                                                                                                                                                                                                                                    
| | (c)                                                                                                                                                                                                         | any bond,
 note, debenture, loan stock or similar instrument;                                                                                                                                                                      
| |                                                                                                                                                                                                             |                                                                                                                                                                                                                                    
| | (d)                                                                                                                                                                                                         | any finance
 or capital lease;                                                                                                                                                                                                     
| |                                                                                                                                                                                                             |                                                                                                                                                                                                                                    
| | (e)                                                                                                                                                                                                         | receivables
 sold or discounted (other than on a non-recourse basis);                                                                                                                                                              
| |                                                                                                                                                                                                             |                                                                                                                                                                                                                                    
| | (f)                                                                                                                                                                                                         | deferred
 payments for assets or services;                                                                                                                                                                                         
| |                                                                                                                                                                                                             |                                                                                                                                                                                                                                    
| | (g)                                                                                                                                                                                                         | any
 derivative transaction protecting against or benefiting from fluctuations in
 any rate or price (and, when calculating the value of any derivative
 transaction, only the marked to market value shall be taken into account);
| |                                                                                                                                                                                                             |                                                                                                                                                                                                                                    
| | (h)                                                                                                                                                                                                         | any amount
 raised under any other transaction (including any forward sale or purchase
 agreement) having the commercial effect of a borrowing;                                                                                    

3

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|    |                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | (i)                                                                                                                                                                                                                                                                                                                                                                   | any
 counter-indemnity obligation in respect of a guarantee, indemnity, bond,
 standby or documentary letter of credit or any other instrument issued by a
 bank or financial institution; and 
|    |                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                
|    | (j)                                                                                                                                                                                                                                                                                                                                                                   | the amount
 of any liability in respect of any guarantee or indemnity for any of the
 items referred to in paragraphs (a) to (i) above;                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                
|    | GAAP means
 generally accepted accounting principles in the United States of America;                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                
|    | Guarantors Liabilities
 means all of the liabilities and obligations of the Guarantor to the Bank
 under or pursuant to this Guarantee and Indemnity, from time to time, whether
 in respect of principal, interest, costs or otherwise and whether present,
 future, actual or contingent;                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                
|    | Group means the
 Guarantor and its Subsidiaries;                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                
|    | Indebtedness
 means the aggregate from time to time of: the amount of the Loan outstanding;
 all accrued and unpaid interest on the Loan; the Master Agreement Liabilities
 and all other sums of any nature (together with all accrued and unpaid
 interest on any of those sums) payable by the Borrower to the Bank under all
 or any of the Security Documents;
|    |                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                
|    | Listing means
 the effective trading date of the shares of the Guarantor listed on the New
 York Stock Exchange;                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                
|    | Marketable Securities
 means any bonds, stocks, notes or bills payable in a freely convertible and
 transferable currency and which are listed on a stock exchange acceptable to
 the Bank;                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                
|    | Net Worth means
 Consolidated Total Assets less Consolidated Total Liabilities; and                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                
|    | Side Letter
 means a side letter evidencing the Current Shareholders of the Guarantor on
 the date of the Listing issued by the Guarantor in favour of the Bank in such
 firm as the Bank may require.                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                
|1.2 | Unless
 otherwise specified in this Guarantee and Indemnity, or unless the context
 otherwise requires, all words and expressions defined in the Loan Agreement
 shall have the same meaning, when used in this Guarantee and Indemnity.                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                
|1.3 | In this
 Guarantee and Indemnity:                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                
|    | (a)                                                                                                                                                                                                                                                                                                                                                                   | words
 denoting the plural number include the singular and vice versa;                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                
|    | (b)                                                                                                                                                                                                                                                                                                                                                                   | words
 denoting persons include corporations, partnerships, associations of persons
 (whether incorporated or not) or governmental or quasi-governmental bodies or
 authorities and vice versa;

4

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|    |                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                         
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | (c)                                                                                                                                                                                                                                                                                                                             | references
 to Clauses are references to clauses of this Guarantee and Indemnity;                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                         
|    | (d)                                                                                                                                                                                                                                                                                                                             | references
 to this Guarantee and Indemnity include the recitals to this Guarantee and Indemnity;                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                         
|    | (e)                                                                                                                                                                                                                                                                                                                             | the headings
 and contents page(s) are for the purpose of reference only, have no legal or
 other significance, and shall be ignored in the interpretation of this
 Guarantee and Indemnity;                                            
|    |                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                         
|    | (f)                                                                                                                                                                                                                                                                                                                             | references
 to any document (including, without limitation, to any of the Security
 Documents) are, unless the context otherwise requires, references to that
 document as amended, supplemented, novated or replaced from time to time;
|    |                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                         
|    | (g)                                                                                                                                                                                                                                                                                                                             | references
 to statutes or provisions of statutes are references to those statutes, or those provisions, as from time to time
 amended, replaced or reenacted;                                                                          
|    |                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                         
|    | (h)                                                                                                                                                                                                                                                                                                                             | references
 to the Bank include its successors, transferees and assignees; and                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                         
|    | (i)                                                                                                                                                                                                                                                                                                                             | words and
 expressions defined in the Master Agreement, unless the context otherwise
 requires, have the same meaning.                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                         
|2.  | REPRESENTATIONS AND WARRANTIES                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                         
|    | The
 Guarantor represents and warrants to the Bank at the date of this Guarantee
 and Indemnity and, save for Clauses 2.4, 2.9 and 2.13. (by reference to the
 facts and circumstances then pertaining) on each day throughout the Security
 Period that:                                                                      
|    |                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                         
|2.1 | all
 representations and warranties given by the Borrower in the Loan Agreement in
 respect of the Guarantor and/or this Guarantee and Indemnity are and will
 remain correct and none of them is or will become misleading; and                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                         
|2.2 | the
 Guarantor is a corporation, duly incorporated and validly existing under the
 law of its jurisdiction of incorporation and has the power to own its assets
 and to carry on its business as it is being conducted; and                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                         
|2.3 | the
 Guarantor has the power to enter into and perform this Guarantee and
 Indemnity and has taken all necessary action to authorise its entry into and
 performance of this Guarantee and Indemnity; and                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                         
|2.4 | the
 Guarantor is not insolvent or in liquidation or administration or subject to
 any other formal or informal insolvency procedure, and no receiver,
 administrative receiver, administrator, liquidator, trustee or analogous
 officer has been appointed in respect of the Guarantor or all or any part of
 its assets; and

5

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|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|2.5  | this
 Guarantee and Indemnity constitutes legal, valid, binding and enforceable
 obligations of the Guarantor; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 
|2.6  | all
 consents, licences, approvals and authorisations of, or registrations with or
 declarations to, any governmental authority, bureau or agency which may be
 required in connection with the entry into, performance, validity or
 enforceability of this Guarantee and Indemnity have been obtained or made and
 remain in full
 force and effect and the Guarantor is not aware of any event or circumstance
 which could reasonably be expected adversely to affect the right of the
 Guarantor to hold and/or obtain renewal of any such consents, licences,
 approvals or authorisations; and
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 
|2.7  | no
 litigation, arbitration or administrative proceeding of or before any court,
 arbitral body or agency which if adversely determined, might reasonably be
 expected to have a material adverse effect on the business or financial
 condition of the Guarantor have (to the best of the Guarantors knowledge and
 belief) been started
 or threatened against the Guarantor; and                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 
|2.8  | the entry
 into and performance of this Guarantee and Indemnity will not conflict with
 the constitutional documents of the Guarantor or any law or regulation or
 document applicable to, or binding on, the Guarantor or any of its assets;
 and                                                                                                                                                                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 
|2.9  | the
 Guarantor is not required to make any deduction or withholding from any
 payment which it may be obliged to make to the Bank under or pursuant to this
 Guarantee and Indemnity; and                                                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 
|2.10 | it is not
 necessary to ensure the legality, validity, enforceability or admissibility in evidence of this Guarantee and Indemnity that it be
filed, recorded
 or enrolled with any court or other authority in any country or that
 any stamp, registration or similar tax be paid on or in relation to this
 Guarantee and Indemnity; and                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 
|2.11 | the Guarantor
 is not in breach of, or default under, any agreement of any sort binding on
 it or on all or any part of its assets; and                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 
|2.12 | and the
 Guarantor is not aware of any material facts or circumstances which have not
 been disclosed to the Bank and which might, if disclosed, have adversely
 affected the decision of a person considering whether or not to make loan
 facilities of the nature contemplated by the Loan Agreement available to the
 Borrower; and                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 
|2.13 | the
 Guarantor has received a copy of the Loan Agreement and approves of, and
 agrees to, the terms and conditions of the Loan Agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                            

6

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|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                          
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.  | GUARANTEE AND INDEMNITY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                          
|    | The
 Guarantor:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                          
|3.1 | irrevocably
 and unconditionally guarantees the due and punctual payment of each and every
 part of the Indebtedness in accordance with the terms of the Security
 Documents so that, if any of the Indebtedness is not paid when it is due and
 payable, whether on maturity or otherwise, the Guarantor will, immediately on demand make
 such payment to the Bank in the manner specified by the Bank, together with
 interest on the amount demanded at the rate accruing on the same under the
 Loan Agreement from the date of demand until the date of payment, both before
 and after judgment; and                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                          
|3.2 | agrees, as a
 separate and independent obligation, that, if any of the Indebtedness is not
 recoverable from the Guarantor under Clause 3.1 for any reason, the Guarantor
 will be liable as a principal debtor by way of indemnity for the same amount
 as that for which the Guarantor would have been liable had that Indebtedness
 been recoverable, and agrees to discharge its liability under this Clause 3.2
 by making payment to the Bank immediately on demand together with interest on
 the amount demanded at the rate accruing on the same under the Loan Agreement
 from the date of demand until the date of payment, both before and after
 judgment.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                          
|4.  | PRESERVATION OFGUARANTORS LIABILITY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                          
|4.1 | This
 Guarantee and Indemnity is a continuing security for the full amount of the
 Indebtedness from time to time until the expiry of the Security Period.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                          
|4.2 | The Bank may
 without the Guarantors consent and without notice to the Guarantor and
 without in any way releasing or reducing the Guarantors Liabilities:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                          
|    | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | amend, vary,
 novate, or replace any of the Security Documents (other than this Guarantee and Indemnity); and/or                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                          
|    | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | agree with
 the Borrower to increase or reduce the amount of the Loan, or vary the terms
 and conditions for its repayment or prepayment (including, without
 limitation, the rate and/or method of calculation of interest payable on the
 Loan); and/or
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                          
|    | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | allow any
 time or other indulgence to any of the other Security Parties under or in
 connection with any of the Security Documents; and/or                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                          
|    | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | renew, vary,
 release or refrain from enforcing any of the Security Documents (other than
 this Guarantee and Indemnity); and/or                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                          
|    | (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | compound
 with any of the other Security Parties; and/or                                                                                                                                                                                                 

7

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|    |                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | (f)                                                                                                                                                                                                                                                                                                                                                     | enter into,
 renew, vary or terminate any other agreement or arrangement with any of the
 other Security Parties; and/or                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                
|    | (g)                                                                                                                                                                                                                                                                                                                                                     | do or omit
 or neglect to do anything which might, but for this provision, operate to
 release or reduce the liability of the Guarantor under this Guarantee and
 Indemnity.                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                
|4.3 | The
 Guarantors Liabilities shall not be affected by:                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                
|    | (a)                                                                                                                                                                                                                                                                                                                                                     | the absence
 of or any defective, excessive or irregular exercise of, any of the powers of
 any of the other Security Parties; nor                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                
|    | (b)                                                                                                                                                                                                                                                                                                                                                     | any security
 given or payment made to the Bank by any of the other Security Parties being
 avoided or reduced under any law (whether English or foreign) relating to
 bankruptcy or insolvency or analogous circumstance in force from time to
 time; nor                                     
|    |                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                
|    | (c)                                                                                                                                                                                                                                                                                                                                                     | any change
 in the constitution of the Guarantor or of any of the other Security Parties
 or of the Bank or the absorption of or amalgamation by the Bank in or with
 any other entity or the acquisition of all or any part of the assets or
 undertaking of the Bank by any other entity; nor
|    |                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                
|    | (d)                                                                                                                                                                                                                                                                                                                                                     | the
 liquidation, administration, receivership, bankruptcy or insolvency of the
 Guarantor or any of the other Security Parties; nor                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                
|    | (e)                                                                                                                                                                                                                                                                                                                                                     | any of the
 Security Documents (other than this Guarantee and Indemnity) being defective,
 void or unenforceable, or the failure of any other person to provide the Bank
 with any security, guarantee or indemnity envisaged by the Loan Agreement;
 nor                                      
|    |                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                
|    | (f)                                                                                                                                                                                                                                                                                                                                                     | any
 composition, assignment or arrangement being made by any of the other
 Security Parties with any of its creditors; nor                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                
|    | (g)                                                                                                                                                                                                                                                                                                                                                     | anything
 which would, but for this provision, have released or reduced the liability
 of the Guarantor to the Bank.                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                
|4.4 | The Bank may
 continue the account(s) of the Borrower or open one or more new accounts for
 the Borrower notwithstanding any demand under this Guarantee and Indemnity,
 and the Guarantors liability at the date of demand shall not be released or
 affected by any subsequent payment into or out of any of the Borrowers
 accounts with the Bank.
|    |                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                
|5.  | PRESERVATION OF BANKS RIGHTS                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                
|5.1 | This
 Guarantee and Indemnity is in addition to any other security, guarantee or
 indemnity now or in the future held by the Bank in respect of the
 Indebtedness, whether from the Borrower, the Guarantor or any other person,
 and shall not                                                                                                        

8

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|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | merge with,
 prejudice or be prejudiced by, any such security, guarantee or indemnity or
 any contractual or legal right of the Bank.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|5.2 | Any release,
 settlement, discharge or arrangement relating to the Guarantors Liabilities
 shall be conditional on no payment, assurance or security received by the
 Bank in respect of the Indebtedness being avoided or reduced under any law
 (whether English or foreign) in force from time to time relating to
 bankruptcy, insolvency or any (in the opinion of the Bank) analogous circumstance,
 and, after any such avoidance or reduction, the Bank shall be entitled to
 exercise all of its rights, powers, discretions and remedies under or
 pursuant to this Guarantee and Indemnity and/or any other rights, powers,
 discretions or remedies which it would otherwise have been entitled to
 exercise, as if no release, settlement, discharge or arrangement had taken
 place.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|5.3 | Following
 the full payment of the Indebtedness, the Bank shall be entitled to retain
 this Guarantee and Indemnity and any security which it may hold for the
 Guarantors Liabilities until the Bank is satisfied in its discretion that it
 will not have to make any payment under any law referred to in
 Clause 5.2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|5.4 | Until the
 expiry of the Security Period the Guarantor shall not:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | be entitled
 to participate in any sums received by the Bank in respect of any of the Indebtedness; nor                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | be entitled
 to participate in any security held by the Bank in respect of any of the
 Indebtedness nor stand in the place of, or be subrogated for, the Bank in
 respect of any such security; nor                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | take any
 step to enforce any claim against any of the other Security Parties (or their
 respective estates or effects), nor claim or exercise any right of set off or
 counterclaim against any of the other Security Parties, nor make any claim in
 the bankruptcy or liquidation of any of the other Security Parties, in
 respect of any sums paid by the Guarantor to the Bank or in respect of any
 sum which includes the proceeds of realisation of any security at any time
 held by the Bank in respect of any of the Guarantors Liabilities; nor
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | take any
 steps to enforce any other claim which it may have against any of the other
 Security Parties without the prior written consent of the Bank, and then only
 on such terms and subject to such conditions as the Bank may impose.                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|5.5 | The Bank
 may, but shall not be obliged to, resort for its own benefit to any other
 means of payment at any time and in any order it thinks fit without releasing
 or reducing the Guarantors Liabilities.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|5.6 | The Bank may
 enforce this Guarantee and Indemnity either before or after resorting to any
 other means of payment without entitling the Guarantor to any                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

9

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|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                              
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | benefit from
 or share in any such other means of payment until the expiry of the Security
 Period.                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                              
|5.7 | The
 Guarantor agrees that it is, and will throughout the Security Period remain,
 a principal debtor in respect of the Guarantors Liabilities.                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                              
|5.8 | No failure
 to exercise, nor any delay in exercising, on the part of the Bank, any right
 or remedy under this Guarantee and Indemnity shall operate as a waiver, nor
 shall any single or partial exercise of any right or remedy prevent any
 further or other exercise or the exercise of any other right or remedy. The
 rights and remedies provided in this Guarantee and Indemnity are cumulative
 and not exclusive of any rights or remedies provided by law.                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                              
|6.  | UNDERTAKINGS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                              
|6.1 | The
 Guarantor shall pay to the Bank on demand on a full indemnity basis all
 documented costs and expenses incurred by the Bank in or about or incidental
 to the exercise by it of its rights under this Guarantee and Indemnity,
 together with interest at the Default Rate on the amount demanded from the
 date of demand until the date of payment, both before and after judgment,
 which interest shall be compounded with the amount demanded at the end of
 such periods as the Bank may reasonably select.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                              
|6.2 | The
 Guarantor has not taken, and will not take without the prior written consent
 of the Bank (and then only on such terms and subject to such conditions as
 the Bank may impose), any security from any of the other Security Parties in
 connection with this Guarantee and Indemnity, and any security taken by the
 Guarantor notwithstanding this Clause shall be held by the Guarantor in trust
 for the Bank absolutely as a continuing security for the Guarantors
 Liabilities.                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                              
|6.3 | The
 Guarantor will observe and perform any and all covenants and undertakings in
 the Loan Agreement whose observance and performance by the Guarantor the
 Borrower has undertaken to procure.                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                              
|6.4 | The
 Guarantor will not without the Banks prior written consent:                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                              
|    | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | create nor
 permit to arise any Encumbrance or other third party rights over any of its shares in the Borrower other than in
 favour of the Bank; nor                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                              
|    | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | permit the
 Borrower to acquire any new vessels nor permit the Borrower to create or
 permit to arise or continue any Encumbrance or other third party right on or
 over all or any part of its present or future assets or undertakings; nor
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                              
|    | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | (such
 consent not to be unreasonably withheld) enter into any amalgamation or merger with any other party.                                                                                                                                  

10

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|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                              
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|6.5  | The
 Guarantor shall supply to the Bank as soon as the same become available, but
 in any event within one hundred and eighty (180) days after the end of each
 of its financial years, its audited consolidated financial statements for
 that financial year, together with a Compliance Certificate, signed by two
 directors of the Guarantor, setting out (in reasonable detail) computations
 as to compliance with clause 6.10 as at the date at which those financial
 statements were drawn up. Each set of financial statements shall be:-               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                              
|     | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | prepared
 using GAAP; and                                                                                                                                                                                                                                                                                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                              
|     | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | certified by
 a director of the Guarantor as fairly representing its financial condition as at the date at which those
 financial statements were drawn up.                                                                                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                              
|6.6  | The
 Guarantor shall supply to the Bank as soon as the same become available, but
 in any event within ninety (90) days after the end of each quarter during
 each of the Guarantors financial years, its unaudited consolidated quarterly
 financial statements for that quarter, together with a Compliance Certificate
 to be provided on a semi­annual basis, signed by two directors of the
 Guarantor, setting out (in reasonable detail) computations as to compliance
 with clause 6.10 as at the date at which those financial statements were
 drawn up.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                              
|6.7  | The
 Guarantor shall supply to the Bank:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                              
|     | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | all
 documents dispatched by the Guarantor to its shareholders (or any class of
 them) or its creditors generally at the same time as they are dispatched
 other than any documents that are subject to any confidentiality restrictions
 pursuant to the New York Stock Exchange regulations that may prohibit such
 dissemination;                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                              
|     | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | promptly
 upon becoming aware of them, details of any litigation, arbitration or
 administrative proceedings which are current, threatened or pending against
 any Security Party, and which might, if adversely determined, have a
 materially adverse effect on the business, assets, financial condition or
 credit worthiness of that Security Party; and
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                              
|     | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | promptly,
 such further information regarding the financial condition, business and operations of any Security Party as the
 Bank may reasonably request.                                                                                                                                                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                              
|6.8  | The
 Guarantor shall permit the inspection of its financial records and accounts
 from time to time by the Bank or its nominee.                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                              
|6.9  | The
 Guarantor shall remain directly or indirectly beneficially owned at a minimum
 of fifty one per cent (51%) by its Current Shareholders or any of them as of
 the date of Listing.                                                                                                                                                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                              
|6.10 | The
 Guarantor shall on a consolidated basis comply with the following financial
 covenants to be assessed on a semi-annual basis based on the Accounting                                                                                                                                                                                                                                                                                                                                                                                                          

11

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|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                 
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------
|    | Information
 received by the Bank in accordance with clause 14.5 of the Loan Agreement:-                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                 
|    | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | Consolidated
 Group Leverage: The Consolidated Group Leverage
 shall be equal to or less than
 seventy per cent (70%).          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                 
|    | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | Debt to EBITDA
 ratio: The ratio of Debt to EBITDA on a trailing
 twelve (12) months basis shall not
 at any time exceed 5.5:1.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                 
|    | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | Net Worth:
 The Net Worth shall not at any time be less than one hundred and seventy five million Dollars
 ($175,000,000).      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                 
|7.  | PAYMENTS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                 
|7.1 | All amounts
 payable by the Guarantor under or pursuant to this Guarantee and Indemnity
 shall be paid to such accounts at such banks as the Bank may from time to
 time direct to the Guarantor in the relevant currency in same day funds for
 immediate value. Payment shall be deemed to have been received on the date on
 which the Bank receives authenticated advice of receipt, unless that advice
 is received by the Bank on a day other than a Banking Day or at a time of day
 (whether on a Banking Day or not) when the Bank in its discretion considers
 that it is impossible or impracticable to utilise the amount received for
 value that same day, in which event the payment in question shall be deemed
 to have been received on the Banking Day next following the date of receipt
 of advice by the Bank.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                 
|7.2 | All payments
 to be made by the Guarantor pursuant to this Guarantee and Indemnity shall,
 subject only to Clause 7.3, be made free and clear of and without deduction
 for or on account of any taxes or other deductions, withholdings,
 restrictions, conditions or counterclaims of any nature, and the Guarantor
 will not claim any equity in respect of any payment due from it to the Bank
 under or in relation to this Guarantee and Indemnity.                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                 
|7.3 | If at any
 time any law requires (or is interpreted to require) the Guarantor to make
 any deduction or withholding from any payment, or to change the rate or
 manner in which any required deduction or withholding is made, the Guarantor
 will promptly notify the Bank and, simultaneously with making that payment,
 will pay whatever additional amount (after taking into account any additional
 taxes on, or deductions or withholdings from, or restrictions or conditions
 on, that additional amount) is necessary to ensure that, after making the
 deduction or withholding, the Bank receives a net sum equal to the sum which
 it would have received had no deduction or withholding been made.                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                 
|7.4 | If at any
 time the Guarantor is required by law to make any deduction or withholding
 from any payment to be made by it pursuant to this Guarantee and Indemnity,
 the Guarantor will pay the amount required to be deducted or withheld to the
 relevant authority within the time allowed under the applicable law and will,
 no later than thirty days after making that payment, deliver to the Bank an                                                                                                                                                                                                                                                                                                                                                                                                                        

12

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|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|    | original
 receipt issued by the relevant authority, or other evidence acceptable to the
 Bank, evidencing the payment to that authority of all amounts required to he
 deducted or withheld.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 
|7.5 | If the
 Guarantor pays any additional amount under Clause 7.3, and the Bank
 subsequently receives a refund or allowance from any tax authority which the
 Bank identifies as being referable to that increased amount so paid by the
 Guarantor, the Bank shall, as soon as reasonably practicable, pay to the
 Guarantor an amount equal to the amount of the refund or allowance received,
 if and to the extent that it may do so without prejudicing its right to
 retain that refund or allowance and without putting itself in any worse
 financial position than that in which it would have been had the relevant
 deduction or withholding not been required to have been made. Nothing in this
 Clause 7.5 shall be interpreted as imposing any obligation on the Bank to
 apply for any refund or allowance nor as restricting in any way the manner in
 which the Bank organises its tax affairs, nor as imposing on the Bank any
 obligation to disclose to the Guarantor any information regarding its tax
 affairs or tax computations.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 
|7.6 | Any
 certificate or statement signed by an authorised signatory of the Bank
 purporting to show the amount of the Indebtedness or of the Guarantors
 Liabilities (or any part of any of them) or any other amount referred to in
 any of the Security Documents shall, save for manifest error or on any
 question of law, be conclusive evidence as against the Guarantor of that
 amount.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 
|8.  | CURRENCY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 
|8.1 | The
 Guarantors liability under this Guarantee and Indemnity is to discharge the
 Indebtedness in the currency in which it is expressed to be payable (the Agreed
 Currency).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 
|8.2 | If at any
 time the Bank receives (including by way of set off) any payment by or on
 behalf of the Guarantor in a currency other than the Agreed Currency, that
 payment shall take effect as a payment to the Bank of the amount in the
 Agreed Currency which the Bank is able to purchase (after deduction of any
 relevant costs) with the amount of the payment so received in accordance with
 its usual practice.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 
|8.3 | To the
 extent that any payment to the Bank (whether by the Guarantor or any other
 person and whether under any judgment or court order or otherwise) in a
 currency other than the Agreed Currency shall on actual conversion into the
 Agreed Currency fall short of the relevant amount of the Indebtedness expressed
 in the Agreed Currency, then the Guarantor as a separate and independent
 obligation will indemnify the Bank against the shortfall.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 
|9.  | SET-OFF                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 
|9.1 | The
 Guarantor irrevocably authorises the Bank at any time to set off without
 notice any sums then due and payable by the Guarantor to the Bank under this                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

13

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|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|     | Guarantee
 and Indemnity (irrespective of the branch or office, currency or place of
 payment) against any credit balance from time to time standing on any account
 of the Guarantor (whether current or otherwise, whether or not subject to
 notice and whether or not that credit balance is then due to the Guarantor)
 with any branch of the Bank in or towards satisfaction of the Guarantors
 Liabilities and, in the name of the Bank or the Guarantor, to do all acts
 (including, without limitation, purchasing or converting or exchanging any
 currency) which may be required to effect such set-off. Notice of such
 set-off shall be given to the Guarantor after such set-off has taken place.                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 
|10.  | APPLICATION OF MONEYS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 
|10.1 | All sums which the
 Bank receives under or in connection with this Guarantee and Indemnity shall,
 unless otherwise agreed by the Bank or otherwise provided in the Loan
 Agreement, be applied
 by the Bank in or towards satisfaction, or by way of retention on account, of
 the Guarantors Liabilities, in such manner as the Bank may in its discretion
 determine.                                                                                                                                                                                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 
|10.2 | The Bank may
 place any money received by it under or in connection with this Guarantee and
 Indemnity to the credit of a suspense account on such terms and subject to
 such conditions as the Bank may in its discretion determine for so long as
 the Bank thinks fit without any obligation in the meantime to apply that
 money in or towards discharge of the Indebtedness, and, despite such payment,
 the Bank may claim against any of the other Security Parties or prove in the
 bankruptcy, liquidation or insolvency of any of the other Security Parties for the whole of the Indebtedness at
 the date of the Banks demand for payment pursuant to this Guarantee and
 Indemnity, together with all interest, commission, charges and expenses
 accruing subsequently.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 
|11.  | PARTIAL INVALIDITY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 
|11.1 | If, at any
 time, any provision of this Guarantee and Indemnity is or becomes illegal,
 invalid or unenforceable in any respect under any law of any jurisdiction,
 neither the legality, validity or enforceability of the remaining provisions
 nor the legality, validity or enforceability of such provision under the law
 of any other jurisdiction will in any way be affected or impaired.                                                                                                                                                                                                                                                                                                                                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 
|12.  | FURTHER ASSURANCE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 
|12.1 | The
 Guarantor agrees that from time to time on the written request of the Bank it
 will immediately execute and deliver to the Bank all further documents which
 the Bank may require for the purpose of perfecting or protecting the security
 intended to be created by this Guarantee and Indemnity.                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

14

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|     |                                                                                                                                                                                                                                                                                                                                                                              | 
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|13.  | MISCELLANEOUS                                                                                                                                                                                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                              | 
|13.1 | All the
 covenants and agreements of the Guarantor in this Guarantee and Indemnity
 shall bind the Guarantor and its successors and permitted assignees and shall
 inure to
 the benefit of the Bank and its successors, transferees and assignees.                                                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                              | 
|13.2 | The
 representations and warranties on the part of the Guarantor contained in this
 Guarantee and Indemnity shall survive the execution of this Guarantee and
 Indemnity.                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                                              | 
|13.3 | No variation
 or amendment of this Guarantee and Indemnity shall be valid unless in O
 writing and signed on behalf of the Guarantor and the Bank.                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                              | 
|13.4 | A person who
 is not a party to this Guarantee and Indemnity has no right under the
 Contracts (Rights of Third Parties) Act 1999 to enforce or to enjoy the
 benefit of any term of this Guarantee and Indemnity.                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                              | 
|14.  | NOTICES                                                                                                                                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                                              | 
|14.1 | The
 provisions of clause 20 of the Loan Agreement shall apply (mutatis mutandis)
 to this Guarantee and Indemnity as if it were set out in full with references
 to this Guarantee and Indemnity substituted for references to the Loan
 Agreement and with references to the Guarantor substituted for references to
 the Borrower.                                       
|     |                                                                                                                                                                                                                                                                                                                                                                              | 
|15.  | COUNTERPARTS                                                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                                              | 
|15.1 | This
 Guarantee and Indemnity may he executed in any number of counterparts, and
 this has the same effect as if the signatures on the counterparts were on a
 single copy of this Guarantee and Indemnity.                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                              | 
|16.  | LAW AND JURISDICTION                                                                                                                                                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                                              | 
|16.1 | This
 Guarantee and Indemnity shall in all respects be governed by and interpreted in accordance with English law.                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                              | 
|16.2 | For the
 exclusive benefit of the Bank, the Guarantor irrevocably agrees that the
 courts of England are to have jurisdiction to settle any disputes which may arise out of or in connection
 with this Guarantee and Indemnity and that any proceedings may be brought in
 those courts.                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                                              | 
|16.3 | Nothing
 contained in this Clause shall limit the right of the Bank to commence any proceedings
 against the Guarantor in any other court of competent jurisdiction nor shall
 the commencement of any proceedings against the Guarantor in one or more
 jurisdictions preclude the commencement of any proceedings in any other
 jurisdiction, whether concurrently or not.
|     |                                                                                                                                                                                                                                                                                                                                                                              | 
|16.4 | The
 Guarantor irrevocably waives any objection which it may now or in the future
 have to the laying of the venue of any proceedings in any court referred to                                                                                                                                                                                                              

15

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|     |                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                   
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     | in this
 Clause and any claim that those proceedings have been brought in an
 inconvenient or inappropriate forum, and irrevocably agrees that a judgment
 in any proceedings commenced in any such court shall be conclusive and
 binding on it and may be enforced in the courts of any other jurisdiction.
|     |                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                   
|16.5 | Without
 prejudice to any other mode of service allowed under any relevant law, the
 Guarantor:                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                   
|     | (a)                                                                                                                                                                                                                                                                                                           | irrevocably
 appoints Mr. Savvas Savvides, 24 Exeter Road, London N14 5JY, England
 (tel/fax: +44 208 361 2606) as its agent for service of process in relation to
 any proceedings before the English courts; and
|     |                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                   
|     | (b)                                                                                                                                                                                                                                                                                                           | agrees that
 failure by a process agent to notify the Guarantor of the process will not invalidate the proceedings
 concerned.                                                                                    

IN WITNESS
WHEREOF, this Guarantee and Indemnity has been duly executed and delivered as a
deed the day and year first before written.

|                                           |                          |   |                  |  |  | 
|------------------------------------------ | ------------------------ | - | ---------------- |  |  | 
|SIGNED and
 DELIVERED as a DEED            |                          | ) |                 
|by SAFE
 BULKERS INC.                      |                          | ) |                 
|acting by
 Mr. George Papadopoulos         |                          | ) |                 
|its duly
 authorised attorney-in-fact      |                          | ) |                 
|in the
 presence of:                       |                          | ) | Attorney-in-fact
|                                           |                          |   |                 
|Witness:                                   |                          |   |                 
|                                           |                          |   |                 
|Name:                                      | Angeliki
 Arcadis        |   |                 
|Address:                                   | Defteras
 Merarchias 13, |   |                 
|                                           | Piraeus, Greece          |   |                 
|Occupation:                                | Attorney-at-law          |   |                 
|                                           |                          |   |                 
|SIGNED as a
 DEED                          |                          | ) |                 
|by DEUTSCHE SCHIFFSBANK AKTIENGESELLSCHAFT |                          | ) |                 
|acting by Mr. Aristeides
 D. Vourdas       |                          | ) |                 
|its duly authorised
 attorney-in-fact      |                          | ) |                 
|in the
 presence of:                       |                          | ) | Attorney-in-fact
|                                           |                          |   |                 
|Witness:                                   |                          |   |                 
|                                           |                          |   |                 
|Name:                                      | Angeliki
 Arcadis        |   |                 
|Address:                                   | Defteras
 Merarchias 13, |   |                 
|                                           | Piraeus, Greece          |   |                 
|Occupation:                                | Attorney-at-law          |   |                 

16

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Schedule 1

Form
of Compliance Certificate(referred to in Clauses 6.5 and 6.6)

|                                             |                                         
|-------------------------------------------- | ----------------------------------------
|To:                                          | DEUTSCHE
SCHIFFSBANK AKTIENGESELLSCHAFT,
|                                             | Domshof 17,
 28195 Bremen,              
|                                             | Federal
 Republic of Germany            
|                                             | (the Bank)                            
|                                             |                                         
|From: SAFE BULKERS INC., of Marshall Islands
|                                             | (the Guarantor)                       

Dated: [l]

Re:  Loan Agreement for up to US$56,600,000 dated [l] June, 2008
(the Loan Agreement)  Guarantee and Indemnity dated [l] June, 2008
executed by the Guarantor in favour of the Bank.

Terms defined
in the Loan Agreement shall have the same meaning when used herein.

I [l], being the CFO/a
director of the Guarantor, refer to Clauses 6.4 and 6.5 of the Guarantee and
hereby certify that, as at [insert date of accounts];

|   |                       |                                                                                                                    
|-- | --------------------- | -------------------------------------------------------------------------------------------------------------------
|1. | Financial
 Covenants:
|   |                       |                                                                                                                    
|   | (a)                   | The
 Consolidated Group Leverage in respect of the applicable financial period is
 [l]
 calculated as follows: [l];
|   |                       |                                                                                                                    
|   | (b)                   | The ratio of
 Debt to EBITDA on a trailing twelve (12) months basis is [l]
 calculated as follows: [l];           
|   |                       |                                                                                                                    
|   | (c)                   | The Net
 Worth is [l]
 calculated as follows: [l].                                                                 
|   |                       |                                                                                                                    
|2. | Default:             

[No Event of
Default has occurred and is continuing]

or

[The following
Event of Default has occurred and is continuing: [provide details of Event of
Default]. [The following steps are being taken to remedy it: [provide details
of steps being taken to remedy the Event of Default]].

SAFE
BULKERS INC.

|                 |  |                  |     | 
|---------------- |  | ---------------- | --- | 
|By:              |  |                  | By: | 
|                 |  |                  |     | 
|Name:            |  | Name:           
|Title:
 Director |  | Title:
 Director

17

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