Exhibit 4.31

Private & Confidential

Dated 20 November 2008


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SUPPLEMENTAL AGREEMENT 
relating to a 
loan of (originally) US$36,000,000

to
PEMER SHIPPING LTD

provided by 
BAYERISCHE HYPO- UND VEREINSBANK AKTIENGESELLSCHAFT

(NORTON ROSE LOGO)

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Contents

|                                                                   |                                 |     
|------------------------------------------------------------------ | ------------------------------- | ----
|Clause                                                             |                                 | Page
|                                                                  
|1                                                                  | Definitions                     | 1   
|                                                                   |                                 |     
|2                                                                  | Agreement of the
 Bank          | 3   
|                                                                   |                                 |     
|3                                                                  | Amendments                      | 3   
|                                                                   |                                 |     
|4                                                                  | Representations
 and warranties | 6   
|                                                                   |                                 |     
|5                                                                  | Conditions                      | 7   
|                                                                   |                                 |     
|6                                                                  | Confirmation                    | 7   
|                                                                   |                                 |     
|7                                                                  | Expenses                        | 7   
|                                                                   |                                 |     
|8                                                                  | Miscellaneous and
 notices      | 8   
|                                                                   |                                 |     
|9                                                                  | Applicable law                  | 9   
|                                                                   |                                 |     
|Schedule 1
 Documents and evidence rquired as conditions precedent | 10                             
|                                                                   |                                
|Schedule 2 form of
 Corporate Guarantee                            | 12                             

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|    | THIS
 SUPPLEMENTAL AGREEMENTis the 20 November 2008 and made BETWEEN:
|    |                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                            
|    | (1)                                                                   | PEMER
 SHIPPING LTD, a corporation incorporated in the Republic of Liberia with its
 registered office at 80 Broad Street, Monrovia, Liberia (the Borrower);                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                            
|    | (2)                                                                   | SAFETY
 MANAGEMENT OVERSEAS S.A., a corporation incorporated in the Republic of
 Panama with its registered office at Edificio Torre Universal, Piso 12,
 Avenida Federico Boyd, P.O. Box 8807, Panama, Republic of Panama (the Manager); and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                            
|    | (3)                                                                   | BAYERISCHE
 HYPO- UND VEREINSBANK AKTIENGESELLSCHAFThaving its registered office at
 Am Tucherpark 16, D-80538, Munich, Germany and acting through its office at 7
 Heraklitou Street, 106 73 Athens, Greece (the Bank).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                            
|    | WHEREAS:                                                             
|    |                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                            
|    | (A)                                                                   | this Agreement is
 supplemental to a loan agreement dated 7 March 2007 made between (1) the
 Borrower and (2) the Bank (the Original
 Agreement) as supplemented by a supplemental letter dated 14 May
 2008 (the First Supplemental Letter)
 and as further supplemented by a supplemental letter dated 15 May 2008 (the Second Supplemental Letter and,
together
 with the First Supplemental Letter and the Original Agreement, the Principal Agreement) relating to a
 multi-currency loan of (originally) Thirty six million Dollars ($36,000,000)
 (which was increased by $4,167,615.01 pursuant to the First Supplemental
 Letter), advanced by the Bank to the Borrower, of which the principal amount
 outstanding at the date hereof is $37,067,615.01; and
|    |                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                            
|    | (B)                                                                   | this Agreement
 sets out the terms and conditions upon which the Bank provides, at the
 request of the Borrower, its consent to:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                            
|    |                                                                       | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | the release of the
 Borrower from its obligation to maintain the Cash Collateral Deposit (as
 defined in the Principal Agreement) and all related obligations under clause
 9.4 of the Principal Agreement;
|    |                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                            
|    |                                                                       | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | certain amendments
 to the terms and conditions applicable to the Loan and the Principal
 Agreement agreed to by the Borrower and the Bank; and                                                            
|    |                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                            
|    |                                                                       | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | certain
 consequential changes to the Principal Agreement required in connection with
 the above and agreed to by the Borrower and the Bank.                                                               
|    |                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                            
|    | NOW
 IT IS HEREBY AGREEDas follows:                                  
|    |                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                            
|1   |                                                                       | Definitions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                            
|1.1 |                                                                       | Defined
 expressions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                            
|    |                                                                       | Words and
 expressions defined in the Principal Agreement shall unless the context
 otherwise requires or unless otherwise defined herein, have the same meanings
 when used in this Agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                            
|1.2 |                                                                       | Definitions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                            
|    |                                                                       | In this Agreement,
 unless the context otherwise requires:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                            
|    |                                                                       | Corporate Guarantee means the guarantee
 executed or (as the context may require) to be executed by the Corporate
 Guarantor in favour of the Bank in the form set out in schedule 2;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                            
|    |                                                                       | Corporate Guarantor means Safe Bulkers,
 Inc. of Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro,
 Marshall Islands MH96960 and includes its successors in title;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

1

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|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|----- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |  | Effective Date means the date no later
 than 24 November 2008, on which the Bank notifies the Borrower in writing
 that the Bank has received the documents and evidence specified in clause 5
 and schedule 1 in a form and substance satisfactory to it;                                                                                                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  | Government Entity means and includes
 (whether having a distinct legal personality or not) any national or local
 government authority, board, commission, department, division, organ,
 instrumentality, court or agency and any association, organisation or
 institution of which any of the foregoing is a member or to whose
 jurisdiction any of the foregoing is subject or in whose activities any of
 the foregoing is a participant;
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  | Indebtedness means any obligation for
 the payment or repayment of money, whether as principal or as surety and
 whether present or future, actual or contingent;                                                                                                                                                                                                                                                                             
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  | Loan Agreement means the Principal
 Agreement as amended by this Agreement;                                                                                                                                                                                                                                                                                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  | Relevant
 Documentsmeans, together, this Agreement and the Corporate Guarantee;                                                                                                                                                                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  | Relevant Parties means, together, the
 Borrower, the Manager and the Corporate Guarantor; and                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  | Supplemental Parties means, together,
 each of the parties to this Agreement (other than the Bank) or, where the
 context so requires or permits, means any of them.                                                                                                                                                                                                                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|1.3   |  | Principal
 Agreement                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  | References in the
 Principal Agreement to this Agreement shall, with effect from the Effective
 Date and unless the context otherwise requires, be references to the
 Principal Agreement as amended by this Agreement and words such as herein,
 hereof, hereunder, hereafter, hereby and hereto, where they appear
 in the Principal Agreement, shall be construed accordingly.                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|1.4   |  | Headings                                                                                                                                                                                                                                                                                                                                                                                                                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  | Clause headings
 and the table of contents are inserted for convenience of reference only and
 shall be ignored in the interpretation of this Agreement.                                                                                                                                                                                                                                                                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|1.5   |  | Construction
 of certain terms                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  | In this Agreement,
 unless the context otherwise requires:                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|1.5.1 |  | references to
 clauses and schedules are to be construed as references to clauses of, and
 schedules to, this Agreement and references to this Agreement includes its
 schedules;                                                                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|1.5.2 |  | references to (or
 to any specified provision of) this Agreement or any other document shall be
 construed as references to this Agreement, that provision or that document as
 in force for the time being and as amended in accordance with terms thereof,
 or, as the case may be, with the agreement of the relevant parties;                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|1.5.3 |  | references to a regulation include any present or future
 regulation, rule, directive, requirement, request or guideline (whether or
 not having the force of law) of any agency, authority, central bank or
 government department or any self-regulatory or other national or
 supra-national authority;                                                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|1.5.4 |  | words importing the
 plural shall include the singular and vice versa;                                                                                                                                                                                                                                                                                                                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|1.5.5 |  | references to a
 time of day are to London time;                                                                                                                                                                                                                                                                                                                                                                                                

2

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|      |  |                                                                                                                                                                                                                                                                                                                        
|----- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1.5.6 |  | references to a
 person shall be construed as references to an individual, firm, company,
 corporation, unincorporated body of persons or any Government Entity;                                                                                                                                                       
|      |  |                                                                                                                                                                                                                                                                                                                        
|1.5.7 |  | references to a guarantee include references to an
 indemnity or other assurance against financial loss including, without
 limitation, an obligation to purchase assets or services as a consequence of
 a default by any other person to pay any Indebtedness and guaranteed shall be construed
 accordingly; and
|      |  |                                                                                                                                                                                                                                                                                                                        
|1.5.8 |  | references to any
 enactment shall be deemed to include references to such enactment as
 re-enacted, amended or extended.                                                                                                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                        
|2     |  | Agreement of
 the Bank                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                        
|      |  | The Bank, relying
 upon the representations and warranties on the part of the Borrower contained
 in clause 4, agrees with the Borrower that, subject to the terms and
 conditions of this Agreement and with effect on the Effective Date, the Bank
 consents and agrees to:                                          
|      |  |                                                                                                                                                                                                                                                                                                                        
|2.1   |  | the matters and
 transactions described in paragraphs (a), (b) and (c) of the Recitals to this
 Agreement; and                                                                                                                                                                                                         
|      |  |                                                                                                                                                                                                                                                                                                                        
|2.2   |  | the amendment of
 the Principal Agreement on the terms set out in clause 3.                                                                                                                                                                                                                                            
|      |  |                                                                                                                                                                                                                                                                                                                        
|3     |  | Amendments                                                                                                                                                                                                                                                                                                             
|      |  |                                                                                                                                                                                                                                                                                                                        
|3.1   |  | Amendments
 to Principal Agreement                                                                                                                                                                                                                                                                                     
|      |  |                                                                                                                                                                                                                                                                                                                        
|      |  | The Principal
 Agreement shall, with effect on and from the Effective Date, be (and it is
 hereby) amended in accordance with the following provisions (and the
 Principal Agreement (as so amended) will continue to be binding upon each of
 the parties hereto upon such terms as so amended):                      
|      |  |                                                                                                                                                                                                                                                                                                                        
|3.1.1 |  | by inserting the
 following definitions of Corporate
 Guarantee, First Supplemental
 Letter Hadjioannou Family,
 Second Supplemental Letter, Supplemental Agreement and Supplemental Letters
in the correct
 alphabetical order in clause 1.2:                                                             
|      |  |                                                                                                                                                                                                                                                                                                                        
|      |  | Corporate Guarantee means the corporate
 guarantee executed or (as the context may require) to be executed by HoldCo
 in favour of the Bank in the form set out in schedule 2 to the Supplemental
 Agreement;;                                                                                                     
|      |  |                                                                                                                                                                                                                                                                                                                        
|      |  | First Supplemental Letter means the
 letter dated 14 May 2008 supplemental to this Agreement issued by the Bank
 and agreed to by the Borrower;;                                                                                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                        
|      |  | Hadjioannou Family means Mr Polys V.
 Hajioannou, Mr Nicolaos V. Hadjioannou, Ms Eleni V. Hajioannou and Ms Maria
 V. Hajioannou and their direct lineal descendants;;                                                                                                                                             
|      |  |                                                                                                                                                                                                                                                                                                                        
|      |  | Second Supplemental Letter means the
 letter dated 15 May 2008 supplemental to this Agreement issued by the Bank
 and agreed to by the Borrower;;                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                        
|      |  | Supplemental Agreement means the
 agreement dated 20 November 2008 supplemental to this Agreement made between
 (inter alios) (1) the Borrower
 and (2) the Bank;; and                                                                                                                                             
|      |  |                                                                                                                                                                                                                                                                                                                        
|      |  | Supplemental Letters means, together,
 the First Supplemental Letter and the Second Supplemental Letter;;                                                                                                                                                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                        
|3.1.2 |  | by inserting the
 words the Supplemental Letters, the Supplemental Agreement, the Corporate
 Guarantee, after the words this Agreement, in the first line of the
 definition of Security Documents
 in clause 1.2;                                                                                               

3

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|      |  |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                   
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|3.1.3 |  | by inserting the
 words HoldCo, after the words the Borrower, in the first line of the
 definition of Security Party
 in clause 1.2;                                                               
|      |  |                                                                                                                                                                                                          
|3.1.4 |  | by deleting the
 definition of Charter in
 clause 1.2 and by inserting in its place the following new definition of Charter:                                                                         
|      |  |                                                                                                                                                                                                          
|      |  | Charter means any time charter or other
 contract of employment for the Ship for a period that equals or exceeds
 twelve (12) months duration and is entered into by the Borrower with a Charterer;;
|      |  |                                                                                                                                                                                                          
|3.1.5 |  | by deleting the
 definition of Margin in clause
 1.2 and by inserting in its place the following new definition of Margin:                                                                           
|      |  |                                                                                                                                                                                                          
|      |  | Margin means zero point seven five per
 cent (0.75%) per annum;;                                                                                                                                     
|      |  |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                   
|3.1.6 |  | by deleting clause
 8.1.1 and by inserting in its place the following new clause 8.1.1:                                                                                                                  
|      |  |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                   
|      |  | 8.1.1                                                                                                                                                                                                    | Due incorporation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                           | the Borrower and
 each of the other Security Parties are duly incorporated and validly existing
 in good standing under the laws of their respective countries of
 incorporation as limited liability companies or, as the case may be,
 corporations and have power to carry on their respective businesses as they
 are now being conducted and to own their respective property and other
 assets;;                                                                                                                                                                                                                                                                                                                                                                                                                                         
|      |  |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|3.1.7 |  | by deleting the
 existing clause 9.2.2 and by inserting in its place the following new clause
 9.2.2:                                                                                                    
|      |  |                                                                                                                                                                                                          
|      |  | 9.2.2                                                                                                                                                                                                    | Valuation of Ship                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                   
|      |  |                                                                                                                                                                                                           | The Ship shall at
 the discretion of the Bank from time to time, for the purposes of this clause
 9.2, be valued in Dollars by an independent firm of shipbrokers appointed by
 the Bank in its sole discretion. Each such valuation shall be made without,
 unless required by the Bank, physical inspection and on the basis of a sale
 for prompt delivery for cash at arms length on normal commercial terms as
 between a willing buyer and a willing seller, taking into account the benefit
 or detriment of any Charter in respect of which a Charter Assignment has been
 executed in favour of the Bank but without taking into account the benefit or
 detriment of any other charterparty or other engagement concerning the Ship.
 Each such valuation shall constitute the value of the Ship for the purposes
 of this clause 9.2.
|      |  |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                           | The value of the
 Ship determined in accordance with the provisions of this clause 9.2 shall be
 binding upon the parties hereto until such time as any further such
 valuations shall be obtained.;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|3.1.8 |  | by:                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                          
|      |  | (a)                                                                                                                                                                                                       | deleting the
 existing clause 9.3.13 in its entirety and renumbering existing clauses
 9.3.14, 9.3.15 and 9.3.16 accordingly; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  | (b)                                                                                                                                                                                                       | inserting the
 following new clause 8.2.13 immediately after the existing clause 8.2.12 and
 renumbering the existing clauses 8.2.13 and 8.2.14 accordingly:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      |  |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                           | 8.2.13                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | Shareholdings                                                                                                                                                                                                                                                     
|      |  |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                   
|      |  |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | the Borrower is a
 wholly-owned direct Subsidiary of HoldCo and as of the date of this Agreement
 no less than 75% of all the issued share capital of HoldCo are ultimately
 beneficially owned (whether directly or indirectly) by the Hadjioannou
 Family; and;

4

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|       |  |                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                    
|------ |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.1.9  |  | by deleting clause
 9.4 in its entirety;                                                                                                                                                                                         
|       |  |                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                    
|3.1.10 |  | by deleting the
 words 9.2, 9.3 or 9.4 at the end of clause 11.1.3 and by inserting the
 following words in their place:                                                                                                       
|       |  |                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                    
|       |  | 9.2 or 9.3 or
 HoldCo commits any breach of or omits to observe any of the obligations or
 undertakings expressed to be assumed by it under clauses 5.1.4, 5.1.5, 5.2 or
 5.3 of the Corporate Guarantee;                      
|       |  |                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                    
|3.1.11 |  | by replacing the
 words the Borrower with the words the Borrower or HoldCo in the first,
 second, fifth and sixth lines of clause 11.1.6, in clauses 11.1.7 to 11.1.16
 (inclusive) and in the second line of clause 11.1.21;
|       |  |                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                    
|3.1.12 |  | by replacing the
 word Borrower with the words the Borrower or HoldCo, as applicable in the
 fourth and eighth lines of clause 11.1.6;                                                                                       
|       |  |                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                    
|3.1.13 |  | by replacing the
 words Borrowers ability with the words the Borrowers or HoldCos
 ability, as applicable, in the ninth line of clause 11.1.6;                                                                            
|       |  |                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                    
|3.1.14 |  | by replacing the
 words this Agreement with the words the Supplemental Agreement in clause
 11.1.21; and                                                                                                                     
|       |  |                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                    
|3.1.15 |  | by deleting clause
 11.1.27 in its entirety and by inserting in its place the following new
 clauses 11.1.27, 11.1.28, and 11.1.29 and by renumbering the existing clause
 11.1.28 as clause 11.1.30;                            
|       |  |                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                    
|       |  | 11.1.27                                                                                                                                                                                                                          | Shareholdings: there is any change in the legal
 and/or ultimate beneficial ownership of any of the shares of the Borrower or
 HoldCo which results in:                                                                                                                                                                                                                                                                              
|       |  |                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                    
|       |  |                                                                                                                                                                                                                                   | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                   | the Borrower
 ceasing at any time to be a wholly-owned direct Subsidiary of HoldCo; or                                                                                                                                                                                                             
|       |  |                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                    
|       |  |                                                                                                                                                                                                                                   | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                   | Mr Polys V.
 Hajioannou and Mr Nicolaos V. Hadjioannou together being at any time the
 ultimate beneficial owners of less than 51% of the total issued share capital
 of HoldCo; or                                                                                                                
|       |  |                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                    
|       |  |                                                                                                                                                                                                                                   | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                   | any person, or
 persons acting in concert (other than Mr Polys V. Hajioannou and Mr Nicolaos
 V. Hadjioannou), having control of HoldCo at any time (and for the purposes
 of this paragraph (c) control
 shall have the meaning given to it in the definition of Subsidiary in clause 1.2); or
|       |  |                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                    
|       |  | 11.1.28                                                                                                                                                                                                                           | Change
 of structure or change of CEO: (a) Mr Polys V. Hajioannou ceases to be the Chief
 Executive Officer of HoldCo at any time; or (b) there occurs any change in
 the corporate or legal or business structure of the Borrower, HoldCo or the
 Manager from that existing on the date of the Supplemental Agreement as
 disclosed and described to the Bank by the Borrower in the negotiation of the
 Supplemental Agreement; or
|       |  |                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                    
|       |  | 11.1.29                                                                                                                                                                                                                           | De-listing:                                                                                                                                                                                                                                                                                                                                                                                                                          
|       |  |                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                    
|       |  |                                                                                                                                                                                                                                   | the shares of
 HoldCo are de-listed from the New York Stock Exchange unless:                                                                                                                                                                                                                                                                                                                                                         
|       |  |                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                    
|       |  |                                                                                                                                                                                                                                   | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                   | Mr Polys V.
 Hajioannou becomes immediately after such de-listing, and remains at all
 times thereafter, the ultimate beneficial owner of at least sixty-five per
 cent (65%) of the issued share capital of HoldCo; and                                                                           
|       |  |                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                    
|       |  |                                                                                                                                                                                                                                   | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                   | the Hadjioannou
 Family becomes immediately after such de-listing, and remains at all times
 thereafter, the ultimate beneficial owner of the total issued share capital
 of HoldCo; or.                                                                                                          

5

---



|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.2   |  | Continued
 force and effect                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |  | Save as amended by
 this Agreement, the provisions of the Principal Agreement and the other
 Security Documents shall continue in full force and effect and the Principal
 Agreement and this Agreement shall be read and construed as one instrument.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|4     |  | Representations
 and warranties                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|4.1   |  | Primary
 representations and warranties                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |  | The Borrower
 represents and warrants to the Bank that:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|4.1.1 |  | Existing
 representations and warranties                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |  | the
 representations and warranties set out in clause 8 of the Principal Agreement
 were true and correct on the date of the Principal Agreement and are true and
 correct, including to the extent that they may have been or shall be amended
 by this Agreement, as if made at the date of this Agreement with reference to
 the facts and circumstances existing at such date;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|4.1.2 |  | Corporate power                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |  | each of the
 Relevant Parties has power to execute, deliver and perform its obligations
 under the Relevant Documents to which it is or is to be a party; all
 necessary corporate, shareholder and other action has been taken by each of
 the Relevant Parties to authorise the execution, delivery and performance of
 the Relevant Documents to which it is or is to be a party;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|4.1.3 |  | Binding
 obligations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |  | the Relevant Documents
 to which it is or is to be a party constitute valid and legally binding
 obligations of each of the Relevant Parties enforceable in accordance with
 their terms;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|4.1.4 |  | No conflict with
 other obligations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |  | the execution,
 delivery and performance of the Relevant Documents to which it is or is to be
 a party by each of the Relevant Parties will not (i) contravene any existing
 law, statute, rule or regulation or any judgment, decree or permit to which
 any of the Relevant Parties is subject, (ii) conflict with, or result in any
 breach of any of the terms of, or constitute a default under, any agreement
 or other instrument to which any of the Relevant Parties is a party or is
 subject or by which any of the Relevant Parties or any of its property is
 bound or (iii) contravene or conflict with any provision of the
 constitutional documents of any of the Relevant Parties or (iv) result in the
 creation or imposition of or oblige any of the Relevant Parties to create any
 Encumbrance on any of their undertakings, assets, rights or revenues of any
 of the Relevant Parties;
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|4.1.5 |  | No filings
 required                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |  | it is not
 necessary to ensure the legality, validity, enforceability or admissibility
 in evidence of any of the Relevant Documents that they or any other
 instrument be notarised, filed, recorded, registered or enrolled in any
 court, public office or elsewhere in any Relevant Jurisdiction or that any
 stamp, registration or similar tax or charge be paid in any Relevant
 Jurisdiction on or in relation to the Relevant Documents and each of the
 Relevant Documents is in proper form for its enforcement in the courts of the
 Relevant Jurisdiction;                                                                                                                                                                                                                                                                                                                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|4.1.6 |  | Choice of law                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |  | the choice of
 English law to govern the Relevant Documents and the submissions by the
 Relevant Parties to the non-exclusive jurisdiction of the English courts are
 valid and binding; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|4.1.7 |  | Consents obtained                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

6

---



|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |  | every consent,
 authorisation, licence or approval of, or registration or declaration to,
 governmental or public bodies or authorities or courts required by any of the
 Relevant Parties in connection with the execution, delivery, validity,
 enforceability or admissibility in evidence of the Relevant Documents to
 which it is or is to be a party or the performance by each Relevant Party of
 its obligations under such document has been obtained or made and is in full
 force and effect and there has been no default in the observance of any
 conditions or restrictions (if any) imposed in, or in connection with, any of
 the same.
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|4.2   |  | Repetition
 of representations and warranties                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |  | Each of the
 representations and warranties contained in clause 4.1 of this Agreement and
 clause 8 of the Principal Agreement (as amended by this Agreement) shall be
 deemed to be repeated by the Borrower on the Effective Date as if made with
 reference to the facts and circumstances existing on such day.                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|5     |  | Conditions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|5.1   |  | Documents
 and evidence                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |  | The agreement of
 the Bank referred to in clause 2 shall be subject to the receipt by the Bank
 or its duly authorised representative of the documents and evidence specified
 in schedule 1 in form and substance satisfactory to the Bank.                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|5.2   |  | General
 conditions precedent                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |  | The agreement of
 the Bank referred to in clause 2 shall be further subject to:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|5.2.1 |  | the
 representations and warranties in clause 4 being true and correct on the
 Effective Date as if each were made with respect to the facts and
 circumstances existing at such time; and                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|5.2.2 |  | no Default having
 occurred and continuing at the time of the Effective Date.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|5.3   |  | Waiver
 of conditions precedent                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |  | The conditions
 specified in this clause 5 are inserted solely for the benefit of the Bank
 and may be waived by the Bank in whole or in part with or without conditions.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|6     |  | Confirmation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|6.1   |  | Security
 Documents                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |  | Each of the
 Borrower and the Manager acknowledges and agrees, for the avoidance of doubt,
 that:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|6.1.1 |  | each of the
 Security Documents to which it is a party, and its obligations thereunder,
 shall remain in full force and effect notwithstanding the amendments made to
 the Principal Agreement by this Agreement; and                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|6.1.2 |  | with effect from
 the Effective Date, references to the Agreement or the Loan Agreement in
 any of the other Security Documents to which it is a party shall henceforth
 be references to the Principal Agreement as amended by this Agreement and as
 from time to time hereafter amended.                                                                                                                                                                                                                                                                                                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|7     |  | Expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|7.1   |  | Expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |  | The Borrower
 agrees to pay to the Bank on a full indemnity basis on demand all expenses
 (including legal and out-of-pocket expenses) incurred by the Bank:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

7

---



|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                 |                          
|----- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------- | -------------------------
|7.1.1 |  | in connection with
 the negotiation, preparation, execution and, where relevant, registration of
 this Agreement and the Corporate Guarantee and of any amendment or extension
 of, or the granting of any waiver or consent under, this Agreement and the
 Corporate Guarantee; and                                                                                                                                                                                                                                                                                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                 |                          
|7.1.2 |  | in contemplation
 of, or otherwise in connection with, the enforcement of, or preservation of
 any rights under this Agreement and the Corporate Guarantee or otherwise in
 respect of the monies owing and obligations incurred under this Agreement and
 the Corporate Guarantee,                                                                                                                                                                                                                                                                                                                                                                     
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                 |                          
|      |  | together with
 interest at the rate referred to in clause 3.4 of the Principal Agreement
 from the date on which such expenses were incurred to the date of payment (as
 well after as before judgement).                                                                                                                                                                                                                                                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                 |                          
|7.2   |  | Value
 Added Tax                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                 |                          
|      |  | All expenses
 payable pursuant to this clause 7 shall be paid together with value added tax
 or any similar tax (if any) properly chargeable thereon.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                 |                          
|7.3   |  | Stamp
 and other duties                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                 |                          
|      |  | The Borrower
 agrees to pay to the Bank on demand all stamp, documentary, registration or
 other like duties or taxes (including any duties or taxes payable by the
 Bank) imposed on or in connection with this Agreement and shall indemnify the
 Bank against any liability arising by reason of any delay or omission by the
 Borrower to pay such duties or taxes.                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                 |                          
|8     |  | Miscellaneous
 and notices                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                 |                          
|8.1   |  | Notices                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                 |                          
|      |  | Every notice,
 request, demand or other communication under this Agreement shall:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                 |                          
|8.1.1 |  | be in writing,
 delivered personally or by first-class prepaid letter (airmail if available)
 or telefax or other means of telecommunication in permanent written form;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                 |                          
|8.1.2 |  | be deemed to have
 been received, subject as otherwise provided in the relevant Security
 Document, in the case of a letter, when delivered personally or three (3)
 days after it has been put into the post and, in the case of a facsimile
 transmission or other means of telecommunication in permanent written form,
 at the time of despatch (provided that if the date of despatch is not a
 business day in the country of the addressee or, if the time of despatch is
 after the close of business in the country of the addressee, it shall be
 deemed to have been received at the opening of business on the next such
 business day); and
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                 |                          
|8.1.3 |  | be sent:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                 |                          
|      |  | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | if to the
 Supplemental Parties or any of them:
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 32 Karamanli
 Avenue 
 166 05 Voula 
 Greece   
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | Fax No:                                         | +30 210 8956900          
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | Attention:                                      | Constantinos
 Adamopoulos

8

---



|                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                   |                 
|------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------- | ----------------
|                                                                                                                                            |  | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | if to the Bank at:                                                                               
|                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                   |                 
|                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | Bayerische Hypo-
 und Vereinsbank Aktiengesellschaft 
 7 Heraklitou Street
 106 73 Athens
 Greece
|                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                   |                 
|                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | Fax:                                                                                              | +30 210 412 6597
|                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | Attention:                                                                                        | The Manager     
|                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                   |                 
|8.2                                                                                                                                         |  | Counterparts                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                            |  | This Agreement may
 be executed in any number of counterparts and by the different parties on
 separate counterparts, each of which when so executed and delivered shall be
 an original but all counterparts shall together constitute one and the same
 instrument.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|9                                                                                                                                           |  | Applicable law                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|9.1                                                                                                                                         |  | Law                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                            |  | This Agreement is
 governed by, and shall be construed in accordance with, English law.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|9.2                                                                                                                                         |  | Submission
 to jurisdiction                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                            |  | Each of the
 Supplemental Parties agrees, for the benefit of the Bank, that any legal
 action or proceedings arising out of or in connection with this Agreement
 against any of their assets may be brought in the English courts. Each of the
 Supplemental Parties irrevocably and unconditionally submits to the
 jurisdiction of such courts and irrevocably designates, appoints and empowers
 Mr. Savvas Savvides at present of 24 Exeter Road, London N14 5JY England to
 receive for it and on its behalf, service of process issued out of the
 English courts in any such legal action or proceedings and each of the
 Supplemental Parties further undertakes that, in the event that such
 individual passes away or cannot be found, each of the Supplemental Parties
 hereby irrevocably and unconditionally authorises the Bank to designate,
 appoint and empower, on each of the Supplemental Parties behalf, Messrs
 Cheeswrights or Messrs Saville & Co. at their then principal place of
 business in London, as substitute process agents of Mr. Savvas Savvides for
 the purposes of this clause. The submission to such jurisdiction shall not
 (and shall not be construed so as to) limit the right of the Bank to take
 proceedings against any of the Supplemental Parties in the courts of any
 other competent jurisdiction nor shall the taking of proceedings in any one
 or more jurisdictions preclude the taking of proceedings in any other
 jurisdiction, whether concurrently or not. Each of the Supplemental Parties
 further agrees that only the courts of England and not those of any other
 state shall have jurisdiction to determine any claim which any of the
 Supplemental Parties may have against the Bank arising out of or in
 connection with this Agreement.
|                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|9.3                                                                                                                                         |  | Contracts
 (Rights of Third Parties) Act 1999                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                            |  | No term of this
 Agreement is enforceable under the Contracts (Rights of Third Parties) Act
 1999 by a person who is not a party to this Agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|IN
 WITNESSwhereof the parties to this Agreement have caused this Agreement to be
 duly executed as a deed on the date first above written.

9

---



Schedule 1 
Documents and evidence required as conditions subsequent

(referred to in clause 5.1)

|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                         
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1 | Corporate
 authorisations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                         
|  | In relation to
 each of the Relevant Parties:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                         
|  | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Constitutional
 documents                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                         
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | copies certified
 by an officer of each of the Relevant Parties, as a true, complete and up to
 date copies, of all documents which contain or establish or relate to the
 constitution of that party or a secretarys certificate confirming that there
 have been no changes or amendments to the constitutional documents certified
 copies of which were previously delivered to the Bank pursuant to the
 Principal Agreement;                                                                          
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                         
|  | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Resolutions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                         
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | copies of
 resolutions of each of its board of directors and, if required following
 advice by the Banks counsel, its shareholders approving this Agreement and
 the other Relevant Documents and the terms and conditions hereof and thereof
 and authorising the signature, delivery and performance of each such partys
 obligations thereunder, certified (in a certificate dated no earlier than
 five (5) Banking Days prior to the date of this Agreement) by an officer of
 such Relevant Party as:
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                         
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | being true and
 correct;                                                                                                                                                
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                         
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (2)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | being duly passed
 at meetings of the directors of such Relevant Party and, as the case may be,
 of the shareholders of such Relevant Party each duly convened and held;
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                         
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (3)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | not having been
 amended, modified or revoked; and                                                                                                                      
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                         
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (4)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | being in full
 force and effect,                                                                                                                                        
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                         
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | together with
 originals or certified copies of any powers of attorney issued by any party
 pursuant to such resolutions; and                                                                                                                                                                                                                                                                                                                                                                                
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                         
|  | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Certificate
 of incumbency                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                         
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | a list of
 directors and officers of each Relevant Party specifying the names and
 positions of such persons, certified (in a certificate dated no earlier than
 five (5) Banking Days prior to the date of this Agreement) by an officer of
 such Relevant Party to be true, complete and up to date;                                                                                                                                                                                                       
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                         
|2 | Consents                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                         
|  | a certificate
 (dated no earlier than five (5) Banking Days prior to the date of this
 Agreement) from an officer of each of the Relevant Parties stating that no
 consents, authorisations, licences or approvals are necessary for such
 Relevant Party to authorise, or are required by each of the Relevant Parties
 or any other party (other than the Bank) in connection with, the execution,
 delivery, and performance of this Agreement and the other Relevant Documents
 to which such Relevant Party is or is to be a party;

10

---



|  |                                                                                                                                                                                                                                                                
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3 | Corporate
 Guarantee                                                                                                                                                                                                                                           
|  |                                                                                                                                                                                                                                                                
|  | the Corporate
 Guarantee (together with any other documents and/or letters to be executed
 and/or delivered to the Bank pursuant thereto) duly executed;                                                                                                       
|  |                                                                                                                                                                                                                                                                
|4 | Legal opinions                                                                                                                                                                                                                                                 
|  |                                                                                                                                                                                                                                                                
|  | such legal
 opinions in relation to the laws of the Republic of Liberia, the Republic of
 the Marshall Islands and the Republic of Panama and any other legal opinions
 as the Bank shall in its absolute discretion require; and                              
|  |                                                                                                                                                                                                                                                                
|5 | Process agent                                                                                                                                                                                                                                                  
|  |                                                                                                                                                                                                                                                                
|  | a letter from each
 Relevant Partys agent for receipt of service of proceedings accepting its
 appointment under this Agreement and the other Relevant Documents to which
 such Relevant Party is or is to be a party as such Relevant Partys process
 agent.

11

---



Schedule 2

Form of Corporate Guarantee

12

---



|                                    |   |                      
|----------------------------------- | - | ---------------------
|EXECUTEDas
 a DEED                  | ) |                      
|by                                  | ) |                      
|for and on behalf
 of               | ) |                      
|PEMER
 SHIPPING LTD                 | ) | Attorney-in-fact     
|as Borrower                         | ) |                      
|in the presence
 of:                |   |                      
|                                    |   |                      
|/s/ Leila Slim                      |   |                      
|                                    |   |                      
|Witness                             |   |                      
|Name: Leila Slim                    |   |                      
|Address:                            |   |                      
|Occupation:
 Trainee Solicitor      |   |                      
|                                    |   |                      
|EXECUTEDas
 a DEED                  | ) |                      
|by                                  | ) |                      
|for and on behalf
 of               | ) |                      
|SAFETY
 MANAGEMENT OVERSEAS S.A.    | ) | Attorney-in-fact     
|as Manager                          | ) |                      
|in the presence
 of:                |   |                      
|                                    |   |                      
|/s/ Leila Slim                      |   |                      
|                                    |   |                      
|Witness                             |   |                      
|Name: Leila Slim                    |   |                      
|Address:                            |   |                      
|Occupation:
 Trainee Solicitor      |   |                      
|                                    |   |                      
|EXECUTEDas
 a DEED                  | ) |                      
|by VASSILIS MANTZAVINOS AND PERCLES | ) |                      
|LYKOUDIS                            | ) | Authorized
 Signatory
|for and on behalf
 of               | ) |                      
|BAYERISCHE
 HYPO- UND VEREINSBANK   | ) |                      
|AKTIENGESELLSCHAFT                  |   |                      
|as Bank                             |   |                      
|in the presence
 of:                |   | Authorized
 Signatory
|                                    |   |                      
|/s/ Leila Slim                      |   |                      
|                                    |   |                      
|Witness                             |   |                      
|Name: Leila Slim                    |   |                      
|Address:                            |   |                      
|Occupation:
 Trainee Solicitor      |   |                      
|                                    |  

13

---



Private & Confidential

Dated 20 November 2008


---

| |                                                      |    
| | ---------------------------------------------------- | ---
| | SAFE BULKERS, INC.                                   | (1)
| |                                                      |    
| | and                                                  |    
| |                                                      |    
| | BAYERISCHE HYPO- UND VEREINSBANK
 AKTIENGESELLSCHAFT | (2)

---

CORPORATE GUARANTEE

---

(NORTON ROSE LOGO)

14

---



|                                           |                                |     
|------------------------------------------ | ------------------------------ | ----
|                                           | Contents                       |     
|Clause                                     |                                | Page
|                                           |                                |     
|1                                          | Interpretation                 | 1   
|                                           |                                |     
|2                                          | Guarantee                      | 6   
|                                           |                                |     
|3                                          | Payments and Taxes             | 8   
|                                           |                                |     
|4                                          | Representations and warranties | 9   
|                                           |                                |     
|5                                          | Undertakings                   | 12  
|                                           |                                |     
|6                                          | Set-off                        | 15  
|                                           |                                |     
|7                                          | Benefit of this Guarantee      | 15  
|                                           |                                |     
|8                                          | Notices and other matters      | 15  
|                                           |                                |     
|9                                          | Law and jurisdiction           | 17  
|                                           |                                |     
|Schedule 1 Form of Compliance
 Certificate | 18                            

15

---



THIS GUARANTEEis dated 20 November 2008 and made BETWEEN:

| |     |                                                                                                                                                                                                                           
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (1) | SAFE BULKERS,
 INC.of Trust Company Complex, Ajeltake Road, Ajeltake Island,
 Majuro, Marshall Islands MH96960 (the Guarantor); and                                                                                     
| |     |                                                                                                                                                                                                                           
| | (2) | BAYERISCHE
 HYPO- UND VEREINSBANK AKTIENGESELLSCHAFThaving its registered
 office at Am Tucherpark 16, D-80538, Munich, Germany and acting through its
 office at 7 Heraklitou Street, 106 73 Athens, Greece (the Bank).

WHEREAS:

| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (A) | by a loan agreement dated 7
 March 2007 as amended and supplemented by a first supplemental letter dated
 14 May 2008, by a second supplemental letter dated 15 May 2008 and by a
 supplemental agreement dated 20 November 2008 (together the Agreement) each made between (inter
 alios) (1) Pemer Shipping Ltd as borrower (the Borrower) and (2) the Bank, the Bank has agreed, upon and
 subject to the terms and conditions of the Agreement, to make (and has made)
 available to the Borrower, a multi-currency loan facility of up to
 (originally) US$36,000,000, which was subsequently increased by $4,167,615.01
 pursuant to the first supplemental letter referred to above;
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | (B) | by a 1992 ISDA master agreement
 (including a schedule thereto) dated as of 7 March 2007 (the Master Swap Agreement) and made between
 the Borrower and the Bank, the Bank agreed the terms and conditions upon
 which it would enter into interest rate swap or other derivative transactions
 with the Borrower in respect of the Loan, whether in whole or in part (as the
 case may be) from time to time; and                                                                                                                                                                                                                                                                           
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | (C) | the execution and delivery of
 this Guarantee is one of the conditions to the Bank continuing to make the
 said loan facility available under the Agreement and this Guarantee is the
 Corporate Guarantee referred to in the Agreement and it constitutes a
 Security Document.                                                                                                                                                                                                                                                                                                                                                                                                               

IT IS AGREEDas follows:

|    |  |                                                                                                                                                                                                                                                                                                                                                                                      
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1   |  | Interpretation                                                                                                                                                                                                                                                                                                                                                                       
|    |  |                                                                                                                                                                                                                                                                                                                                                                                      
|1.1 |  | Defined
 expressions                                                                                                                                                                                                                                                                                                                                                                 
|    |  |                                                                                                                                                                                                                                                                                                                                                                                      
|    |  | In this Guarantee, unless the
 context otherwise requires or unless otherwise defined in this Guarantee,
 words and expressions defined in the Agreement and used in this Guarantee
 shall have the same meanings when used in this Guarantee.                                                                                                                                       
|    |  |                                                                                                                                                                                                                                                                                                                                                                                      
|1.2 |  | Definitions                                                                                                                                                                                                                                                                                                                                                                          
|    |  |                                                                                                                                                                                                                                                                                                                                                                                      
|    |  | In this Guarantee, unless the
 context otherwise requires:                                                                                                                                                                                                                                                                                                                           
|    |  |                                                                                                                                                                                                                                                                                                                                                                                      
|    |  | Accounting
 Information means (a) the annual audited consolidated
 financial statements of the Group, (b) the semi-annual unaudited consolidated
 financial statements of the Group and (c) the quarterly unaudited
 consolidated financial statements of the Group, each as provided or (as the
 context may require) to be provided to the Bank in accordance with clause
 5.1.4;
|    |  |                                                                                                                                                                                                                                                                                                                                                                                      
|    |  | Accounting
 Periodmeans (a) each financial year of the Guarantor,
 (b) each financial half-year of the Guarantor and (c) each financial quarter
 of each financial year of the Guarantor, for which Accounting Information is
 required to be delivered pursuant to this Guarantee;                                                                                                
|    |  |                                                                                                                                                                                                                                                                                                                                                                                      
|    |  | Applicable
 Accounting Principlesmeans the most recent
 and up-to-date US GAAP applicable at any relevant time;                                                                                                                                                                                                                                                                    
|    |  |                                                                                                                                                                                                                                                                                                                                                                                      
|    |  | Bankincludes the successors in title, Assignees and Transferees of the Bank;                                                                                                                                                                                                                                                                                                       

1

---



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Borrowed
 Moneymeans Indebtedness in respect of (i) money
 borrowed or raised and debit balances at banks, (ii) any bond, note, loan
 stock, debenture or similar debt instrument, (iii) acceptance or documentary
 credit facilities, (iv) receivables sold or discounted (otherwise than on a
 non-recourse basis), (v) deferred payments for assets or services acquired,
 (vi) finance leases and hire purchase contracts, (vii) swaps, forward
 exchange contracts, futures and other derivatives, (viii) any other
 transaction (including without limitation forward sale or purchase
 agreements) having the commercial effect of a borrowing or raising of money
 or of any of (ii) to (vii) above and (ix) guarantees in respect of
 Indebtedness of any person falling within any of (i) to (viii) above;
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | Collateral
 Instrumentsmeans notes, bills of exchange, certificates of
 deposit and other negotiable and non-negotiable instruments, guarantees, indemnities
 and other assurances against financial loss and any other documents or
 instruments which contain or evidence an obligation (with or without
 security) to pay, discharge or be responsible directly or indirectly for, any
 indebtedness or liabilities of the Borrower or any other person liable and
 includes any documents or instruments creating or evidencing a mortgage,
 charge (whether fixed or floating), pledge, lien, hypothecation, assignment,
 trust arrangement or security interest of any kind;                                                                                                                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | Compliance
 Certificatemeans a certificate in the form set out in
 schedule 1;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | Consolidated
 Adjusted Leverage Ratiomeans, as of the last
 day of an Accounting Period or on any other day, the ratio of (a) the
 Consolidated Liabilities to (b) the Consolidated Total Assets, as stated in
 the then most recent and relevant Accounting Information;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | Consolidated
 Adjusted Net Worthmeans the aggregate of the amounts paid-up or
 credited as paid-up on the Guarantors issued share capital and the amount of
 the consolidated capital and revenue reserves of the Group (including any
 share premium account, capital redemption reserve fund and any credit balance
 on the consolidated profit and loss account of the Group) all as shown by the
 latest consolidated balance sheet and profit and loss account of the Group
 delivered under this Guarantee but after:                                                                                                                                                                                                                                                                                        
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | deducting any debit balance on
 such consolidated profit and loss account;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | deducting any amount shown in
 such consolidated balance sheet in respect of goodwill (including goodwill
 arising on consolidation) and other intangible assets;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | deducting (so far as not
 otherwise excluded as attributable to minority interests) a sum equal to the
 aggregate of the amount by which the book value of any fixed assets of any
 member of the Group has been written up after 31 December 2007 (or, in the
 case of a company becoming a subsidiary after that date, the date on which
 that company became a subsidiary) by way of revaluation. For the purposes of this
 paragraph (c) any increase in the book value of any fixed asset resulting
 from its transfer by one member of the Group to another member of the Group
 shall be deemed to result from a writing up of its book value by way of
 revaluation;
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | excluding amounts set aside for
 taxation as at the date of such balance sheet and making such adjustments as
 may be appropriate in respect of any significant additional taxation expected
 to result from transactions carried out by any member of the Group after such
 date and not reflected in that balance sheet;                                                                                                                                                                                                                                                                                                                                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | deducting all amounts
 attributable to minority interests in Subsidiaries;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | (f)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | making such adjustments as may
 be appropriate in respect of any variation in the amount of such paid up
 share capital or any such reserves after the date of the relevant balance
 sheet (but so that no such adjustment shall be made in respect of any
 variation in profit and loss account except to the extent of any profit or
 loss, calculated on a cumulative                                                                                                                                                                                                                                                                                                    

2

---



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                    
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | basis, recorded in the
 consolidated profit and loss account of the Group delivered to the Bank
 before the date of this Guarantee, or under clause 5.1.4 in respect of any
 subsequent period);                                                                                                                                                                                                                   
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                    
| | (g)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | making such adjustments as may
 be appropriate in respect of any distribution declared, recommended or made
 by any member of the Group (otherwise than attributable directly or
 indirectly to the Guarantor) out of profits earned up to and including the
 date of the latest audited balance sheet of that member of the Group to the
 extent that such distribution is not provided for in that balance sheet;
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                    
| | (h)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | making such adjustments as may
 be appropriate in respect of any variation in the interests of the Guarantor
 in its Subsidiaries since the date of the latest consolidated balance sheet
 of the Group;                                                                                                                                                                                                           
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                    
| | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | if the calculation is required
 for the purpose of or in connection with a transaction under or in connection
 with which any company is to become or cease to be a Subsidiary of the
 Guarantor, making all such adjustments as would be appropriate if that
 transaction had been carried into effect;                                                                                                           
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                    
| | (j)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | adding the relevant excess in
 the event that the Fleet Market Value exceeds the book values of the Fleet
 Vessels as shown in the then most recent and relevant Accounting Information;                                                                                                                                                                                                                           
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                    
| | (k)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | deducting the relevant shortfall
 in the event that the Fleet Market Value is less than the book values of the
 Fleet Vessels as shown in the then most recent and relevant Accounting
 Information; and                                                                                                                                                                                                           
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                    
| | (l)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | making such adjustments as may
 be appropriate in the opinion of the Bank in order that the above amounts are
 calculated in accordance with the Applicable Accounting Principles;                                                                                                                                                                                                                                 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                    
| | Consolidated Current Assets means, as of the last day of an
 Accounting Period or on any other day, the aggregate of the cash and
 marketable securities, trade and other receivables from persons other than a
 member of the Group realisable within one (1) year, inventories and prepaid
 expenses which are to be charged to income within one (1) year less any
 doubtful debts and any discounts or allowances given, in each case in
 relation to the Group, as stated in the then most recent and relevant
 Accounting Information;
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                    
| | Consolidated Debt means, as of the last day of an
 Accounting Period or on any other day, the aggregate amount of Borrowed Money
 owed by the members of the Group (but excluding Borrowed Money of the type
 referred to in paragraphs (v), (vii) and (viii) of the definition of
 Borrowed Money in this clause 1.2), as stated in the then most recent and
 relevant Accounting Information;                                                                                                                                           
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                    
| | Consolidated Debt Service Ratio means, as of the last day
 of an Accounting Period or on any other day, the ratio of Consolidated Debt
 to Consolidated EBITDA in respect of the Rolling Four Quarter Period ending
 on such day, each as stated in the then most recent and relevant Accounting
 Information;                                                                                                                                                                                                                              
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                    
| | Consolidated EBITDA means, as of the last day of an
 Accounting Period or on any other day, the consolidated net pre-taxation
 profits of the Group in respect of the Rolling Four Quarter Period ending on
 such day, as stated in the then most recent and relevant Accounting
 Information, and all as adjusted by:                                                                                                                                                                                                                      
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                    
| | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | adding back Consolidated Net
 Interest Expense;                                                                                                                                                                                                                                                                                                                                                                    

3

---



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                 
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | taking no account of any
 exceptional or extraordinary item;                                                                                                                                                                                    
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                 
| | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | adding back depreciation and
 amortisation;                                                                                                                                                                                                     
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                 
| | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | deducting any non-cash income an
 non-cash gains; and                                                                                                                                                                                           
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                 
| | (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | taking no account of any
 revaluation of an asset or any loss or gain over book value arising on the
 disposal of an asset (otherwise than in the ordinary course of trading) by a
 member of the Group during that Rolling Four Quarter Period;
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                 
| | Consolidated
 Liabilitiesmeans, as of the last day of an Accounting Period
 or on any other day, the aggregate amount of Liabilities owed by the members
 of the Group, as stated in the then most recent and relevant Accounting
 Information;                                                                                                                                                                                                                               
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                 
| | Consolidated
 Net Interest Expensemeans, as of the last
 day of an Accounting Period or on any other day, all interest and other
 financing charges incurred or paid by the Group minus all interest income
 received by the Group in respect of the Rolling Four Quarter Period ending on
 such day, as stated in the then most recent and relevant Accounting Information;                                                                                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                 
| | Consolidated
 Tangible Fixed Assetsmeans, as of the last
 day of an Accounting Period or on any other day, the aggregate of (a) the
 Fleet Market Value and (b) the book value (less depreciation computed in
 accordance with the Applicable Accounting Principles consistently applied) on
 a consolidated basis of all other tangible fixed assets of the Group (i.e.
 excluding Fleet Vessels), as stated in the then most recent and relevant
 Accounting Information;   
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                 
| | Consolidated
 Total Assetsmeans, at any relevant time, the aggregate of
 Consolidated Current Assets and Consolidated Tangible Fixed Assets;                                                                                                                                                                                                                                                                                                                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                 
| | Fleet Market
 Valuemeans, as of the date of calculation, the
 aggregate market value of the Fleet Vessels as most recently determined
 pursuant to valuations obtained and made in accordance with clause 5.1.5 of
 this Guarantee and the provisions of clause 9.2.2 of the Agreement (at the
 cost of the Guarantor) (and for the purposes of this Guarantee and the
 calculation of Fleet Market Value, such clause 9.2.2 shall apply to this
 Guarantee mutatis mutandis);
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                 
| | Fleet Vesselsmeans
 the vessels (including, but not limited to, the Ship) from time to time owned
 by the members of the Group and Fleet
 Vessel means any of them;                                                                                                                                                                                                                                                                                                         
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                 
| | Groupmeans,
 together, the Guarantor and its Subsidiaries from time to time (including,
 for the avoidance of doubt, the Borrower) and member of the Group shall be construed accordingly;                                                                                                                                                                                                                                                                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                 
| | Guarantee includes each separate or independent stipulation
 or agreement by the Guarantor contained in this Guarantee;                                                                                                                                                                                                                                                                                                                                                       
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                 
| | Guaranteed Liabilities means all moneys, obligations and
 liabilities expressed to be guaranteed by the Guarantor in clause 2.1;                                                                                                                                                                                                                                                                                                                                              
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                 
| | Guarantor
 includes the Guarantors successors in title;                                                                                                                                                                                                                                                                                                                                                                                                                      
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                 
| | Hadjioannou
 Familymeans Mr Polys V. Hajioannou, Mr Nicolaos V.
 Hadjioannou, Ms Eleni V. Hajioannou and Ms Maria V. Hajioannou and their
 direct lineal descendants;                                                                                                                                                                                                                                                                                                         
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                                                                                                                                                                                                                                 
| | Incapacitymeans,
 in relation to a person, the death, bankruptcy, unsoundness of mind, insolvency,
 liquidation, dissolution, winding-up, administration, receivership,
 amalgamation, reconstruction or other incapacity of that person whatsoever
 (and, in the case of a partnership, includes the termination or change in the
 composition of the partnership);                                                                                                          

4

---



| |                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Liabilitiesmeans,
 in relation to any member of the Group (the debtor):                                                                                                                                                            
| |                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                
| | (a)                                                                                                                                                                                                                                     | Borrowed Money of the debtor;                                                                                                                                                                                                                                                  
| |                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                
| | (b)                                                                                                                                                                                                                                     | liability for any credit to the
 debtor from a supplier of goods or services or under any instalment purchase
 or payment plan or other similar arrangement;                                                                                                                   
| |                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                
| | (c)                                                                                                                                                                                                                                     | contingent liabilities of the
 debtor (including without limitation any taxes or other payments under
 dispute) which have been or, under the Applicable Accounting Principles
 consistently applied, should be recorded in the notes to the Accounting
 Information;          
| |                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                
| | (d)                                                                                                                                                                                                                                     | deferred tax of the debtor; and                                                                                                                                                                                                                                                
| |                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                
| | (e)                                                                                                                                                                                                                                     | liability under a guarantee,
 indemnity or similar obligation entered into by the debtor in respect of a
 liability of another person who is not a member of the Group which would fall
 within (a) to (d) above if the references to the debtor referred to the other
 person;
| |                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                
| | Relevant
 Jurisdictionmeans any jurisdiction in which or where the
 Guarantor is incorporated, resident, domiciled, has a permanent
 establishment, carries on or has a place of business or is otherwise
 effectively connected; and
| |                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                
| | Rolling Four
 Quarter Periodmeans, as of the last day of an Accounting Period
 or on any other day, the twelve-month period ending on such day.                                                                                      

|      |  |                                                                                                                                                                                                                                                                                                                                                          | 
|----- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|1.3   |  | Headings                                                                                                                                                                                                                                                                                                                                                
|      |  |                                                                                                                                                                                                                                                                                                                                                          | 
|      |  | Clause headings and the table of
 contents are inserted for convenience of reference only and shall be ignored
 in the interpretation of this Guarantee.                                                                                                                                                                                                
|      |  |                                                                                                                                                                                                                                                                                                                                                          | 
|1.4   |  | Construction of
 certain terms                                                                                                                                                                                                                                                                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                          | 
|      |  | In this Guarantee, unless the context
 otherwise requires:                                                                                                                                                                                                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                          | 
|1.4.1 |  | references to clauses are to be
 construed as references to the clauses of this Guarantee;                                                                                                                                                                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                          | 
|1.4.2 |  | references to (or to any
 specified provision of) this Guarantee or any other document shall be
 construed as references to this Guarantee, that provision or that document as
 in force for the time being and as amended from time to time in accordance
 with the terms thereof, or, as the case may be, with the agreement of the
 relevant parties;
|      |  |                                                                                                                                                                                                                                                                                                                                                          | 
|1.4.3 |  | words importing the plural shall
 include the singular and vice versa;                                                                                                                                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                          | 
|1.4.4 |  | references to a time of day are
 to London time;                                                                                                                                                                                                                                                                                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                          | 
|1.4.5 |  | references to a person shall be
 construed as including references to an individual, firm, company,
 corporation, unincorporated body of persons or any Government Entity;                                                                                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                          | 
|1.4.6 |  | references to a guarantee include references to an
 indemnity or other assurance against financial loss including, without
 limitation, any obligation to purchase assets or services as a consequence of
 a default by any other person to pay any Indebtedness and guaranteed shall be construed
 accordingly; and                                
|      |  |                                                                                                                                                                                                                                                                                                                                                          | 
|1.4.7 |  | references to any enactment
 shall be deemed to include reference to such enactment as re-enacted, amended
 or extended.                                                                                                                                                                                                                                

5

---



|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2   |  | Guarantee                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|2.1 |  | Covenant to pay                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |  | In consideration of the Bank
 making or continuing loans or advances to, or otherwise giving credit or
 granting banking facilities or accommodation or granting time to, the
 Borrower pursuant to the Agreement and/or the Master Swap Agreement, the
 Guarantor hereby guarantees to pay to the Bank, on demand by the Bank all
 moneys and discharge all obligations and liabilities now or hereafter due,
 owing or incurred by the Borrower to the Bank under or pursuant to the
 Agreement, the Master Swap Agreement and the other Security Documents when
 the same become due for payment or discharge whether by acceleration or
 otherwise, and whether such moneys, obligations or liabilities are express or
 implied, present, future or contingent, joint or several, incurred as
 principal or surety, originally owing to the Bank or purchased or otherwise
 acquired by it, denominated in Dollars or in any other currency, or incurred
 on any banking account or in any other manner whatsoever.                                                                                                                                                                           
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |  | Such liabilities shall, without
 limitation, include interest (as well after as before judgment) to date of
 payment at such rates and upon such terms as may from time to time be agreed,
 commission, fees and other charges and all legal and other costs, charges and
 expenses on a full and unqualified indemnity basis which may be incurred by
 the Bank in relation to any such moneys, obligations or liabilities or
 generally in respect of the Borrower, the Guarantor or any Collateral
 Instrument.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|2.2 |  | Guarantor as
 principal debtor; indemnity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |  | As a separate and independent
 stipulation, the Guarantor agrees that if any purported obligation or
 liability of the Borrower which would have been the subject of this Guarantee
 had it been valid and enforceable is not or ceases to be valid or enforceable
 against the Borrower on any ground whatsoever whether or not known to the
 Bank (including, without limitation, any irregular exercise or absence of any
 corporate power or lack of authority of, or breach of duty by, any person
 purporting to act on behalf of the Borrower or any legal or other limitation,
 whether under the Limitation Acts or otherwise or any disability or
 Incapacity or any change in the constitution of the Borrower) the Guarantor
 shall nevertheless be liable to the Bank in respect of that purported
 obligation or liability as if the same were fully valid and enforceable and
 the Guarantor were the principal debtor in respect thereof. The Guarantor
 hereby agrees to keep the Bank fully indemnified on demand against all
 damages, losses, costs and expenses arising from any failure of the Borrower
 to perform or discharge any such purported obligation or liability.
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|2.3 |  | Statements of
 account conclusive                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |  | Any statement of account, signed
 as correct by an officer of the Bank, showing the amount of the Guaranteed
 Liabilities shall, in the absence of manifest error, be binding and
 conclusive on and against the Guarantor.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|2.4 |  | No security
 taken by Guarantor                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |  | The Guarantor warrants that it
 has not taken or received, and undertakes that until all the Guaranteed
 Liabilities of the Borrower have been paid or discharged in full, it will not
 take or receive, the benefit of any security from the Borrowers or either of
 them or any other person in respect of its obligations under this Guarantee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|2.5 |  | Interest                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |  | The Guarantor agrees to pay
 interest on each amount demanded of it under this Guarantee from the date of
 such demand until payment (as well after as before judgment) at the rate
 specified in clause 3.4 of the Agreement which shall apply to this Guarantee
 mutatis mutandis. Such interest shall be compounded at the end of each period
 determined for this purpose by the Bank in the                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

6

---



|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|----- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |  | event of it not being paid when
 demanded but without prejudice to the Banks right to require payment of such
 interest.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2.6   |  | Continuing
 security and other matters                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | This Guarantee shall:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2.6.1 |  | secure the ultimate balance from
 time to time owing to the Bank by the Borrower and shall be a continuing
 security, notwithstanding any settlement of account or other matter
 whatsoever;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2.6.2 |  | be in addition to any present or
 future Collateral Instrument, right or remedy held by or available to the
 Bank; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2.6.3 |  | not be in any way prejudiced or
 affected by the existence of any such Collateral Instrument, rights or
 remedies or by the same becoming wholly or in part void, voidable or
 unenforceable on any ground whatsoever or by the Bank dealing with,
 exchanging, varying or failing to perfect or enforce any of the same or
 giving time for payment or indulgence or compounding with any other person
 liable.                                                                                                                                                                                                                                                                                            
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2.7   |  | Liability
 unconditional                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | The liability of the Guarantor
 shall not be affected nor shall this Guarantee be discharged or reduced by
 reason of:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2.7.1 |  | the Incapacity or any change in
 the name, style or constitution of the Borrower or any other person liable;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2.7.2 |  | the Bank granting any time,
 indulgence or concession to, or compounding with, discharging, releasing or
 varying the liability of, the Borrower or any other person liable or
 renewing, determining, varying or increasing any accommodation, facility or
 transaction or otherwise dealing with the same in any manner whatsoever or
 concurring in, accepting or varying any compromise, arrangement or settlement
 or omitting to claim or enforce payment from the Borrower or any other person
 liable; or                                                                                                                                                                                           
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2.7.3 |  | any act or omission which would
 not have discharged or affected the liability of the Guarantor had it been a
 principal debtor instead of a guarantor or by anything done or omitted which
 but for this provision might operate to exonerate the Guarantor.                                                                                                                                                                                                                                                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2.8   |  | Collateral
 Instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | The Bank shall not be obliged to
 make any claim or demand on the Borrower or to resort to any Collateral
 Instrument or other means of payment now or hereafter held by or available to
 it before enforcing this Guarantee and no action taken or omitted by the Bank
 in connection with any such Collateral Instrument or other means of payment
 shall discharge, reduce, prejudice or affect the liability of the Guarantor
 under this Guarantee nor shall the Bank be obliged to apply any money or
 other property received or recovered in consequence of any enforcement or
 realisation of any such Collateral Instrument or other means of payment in
 reduction of the Guaranteed Liabilities.
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2.9   |  | Waiver of
 Guarantors rights                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | Until all the Guaranteed
 Liabilities have been paid, discharged or satisfied in full (and
 notwithstanding payment of a dividend in any liquidation or under any
 compromise or arrangement) the Guarantor agrees that, without the prior
 written consent of the Bank, it will not:                                                                                                                                                                                                                                                                                                                                                                                                                       
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2.9.1 |  | exercise its rights of
 subrogation, reimbursement and indemnity against the Borrower or any other
 person liable;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

7

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|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|----- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2.9.2 |  | demand or accept repayment in
 whole or in part of any indebtedness now or hereafter due to the Guarantor
 from the Borrower or from any other person liable or demand or accept any
 Collateral Instrument in respect of the same or dispose of the same;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|2.9.3 |  | take any step to enforce any
 right against the Borrower or any other person liable in respect of any
 Guaranteed Liabilities; or                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|2.9.4 |  | claim any set-off or
 counterclaim against the Borrower or any other person liable or claim or
 prove in competition with the Bank in the liquidation of the Borrower or any
 other person liable or have the benefit of, or share in, any payment from or
 composition with, the Borrower or any other person liable or any other
 Collateral Instrument now or hereafter held by the Bank for any Guaranteed
 Liabilities or for the obligations or liabilities of any other person liable
 but so that, if so directed by the Bank, it will prove for the whole or any
 part of its claim in the liquidation of the Borrower or any other person
 liable on terms that the benefit of such proof and of all money received by
 it in respect thereof shall be held on trust for the Bank and applied in or
 towards discharge of the Guaranteed Liabilities in such manner as the Bank
 shall deem appropriate.
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|2.10  |  | Suspense
 accounts                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |  | Any money received in connection
 with this Guarantee (whether before or after any Incapacity of the Borrower
 or the Guarantor) may be placed to the credit of a suspense account with a
 view to preserving the rights of the Bank to prove for the whole of its claims
 against the Borrower or any other person liable or may be applied in or
 towards satisfaction of such of the Guaranteed Liabilities as the Bank may
 from time to time conclusively determine in its absolute discretion.                                                                                                                                                                                                                                                                                                                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|2.11  |  | Settlements
 conditional                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |  | Any release, discharge or
 settlement between the Guarantor and the Bank shall be conditional upon no
 security, disposition or payment to the Bank by the Borrower or any other
 person liable being void, set aside or ordered to be refunded pursuant to any
 enactment or law relating to bankruptcy, liquidation, administration or
 insolvency or for any other reason whatsoever and if such condition shall not
 be fulfilled the Bank shall be entitled to enforce this Guarantee
 subsequently as if such release, discharge or settlement had not occurred and
 any such payment had not been made.                                                                                                                                                                                                                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|2.12  |  | Guarantor to
 deliver up certain property                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |  | If, contrary to clauses 2.4 or
 2.9 the Guarantor takes or receives the benefit of any security or receives
 or recovers any money or other property, such security, money or other
 property shall be held on trust for the Bank and shall be delivered to the
 Bank on demand.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|2.13  |  | Retention of
 this Guarantee                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |  | The Bank shall be entitled to
 retain this Guarantee after as well as before the payment or discharge of all
 the Guaranteed Liabilities for such period as the Bank may determine.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|3     |  | Payments and
 Taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|3.1   |  | No set off or
 counterclaim                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |  | All payments to be made by the
 Guarantor under this Guarantee shall be made in full, without any set-off or
 counterclaim whatsoever and, subject as provided in clause 3.2, free and
 clear of any deductions or withholdings, in Dollars (except for charges or
 expenses which shall be paid in the currency in which they are incurred) on the
 due date to such account of the Bank as it may specify in writing to the
 Guarantor from time to time.                                                                                                                                                                                                                                                                                                                                                                                                                                                       

8

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|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.2   |  | Grossing up for
 Taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |  | If at any time the Guarantor is
 required to make any deduction or withholding in respect of Taxes from any payment
 due under this Guarantee for the account of the Bank, the sum due from the
 Guarantor in respect of such payment shall be increased to the extent
 necessary to ensure that, after the making of such deduction or withholding,
 the Bank receives on the due date for such payment (and retains, free from
 any liability in respect of such deduction or withholding) a net sum equal to
 the sum which it would have received had no such deduction or withholding
 been required to be made and the Guarantor shall indemnify the Bank against
 any losses or costs incurred by it by reason of any failure of the Guarantor
 to make any such deduction or withholding or by reason of any increased
 payment not being made on the due date for such payment. The Guarantor shall
 promptly deliver to the Bank any receipts, certificates or other proof
 evidencing the amounts (if any) paid or payable in respect of any deduction
 or withholding as aforesaid.                                                                                                                                                                                                                                                                                                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|3.3   |  | Currency
 indemnity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |  | If any sum due from the
 Guarantor under this Guarantee or any order or judgment given or made in
 relation hereto has to be converted from the currency (the first currency) in which the same is
 payable under this Guarantee or under such order or judgment into another
 currency (the second currency)
 for the purpose of (a) making or filing a claim or proof against the
 Guarantor, (b) obtaining an order or judgment in any court or other tribunal
 or (c) enforcing any order or judgment given or made in relation to this
 Guarantee, the Guarantor shall indemnify and hold harmless the Bank from and
 against any loss suffered as a result of any difference between (i) the rate
 of exchange used for such purpose to convert the sum in question from the
 first currency into the second currency and (ii) the rate or rates of exchange
 at which the Bank may in the ordinary course of business purchase the first
 currency with the second currency upon receipt of a sum paid to it in
 satisfaction, in whole or in part, of any such order, judgment, claim or
 proof. Any amount due from the Guarantor under this clause 3.3 shall be due
 as a separate debt and shall not be affected by judgment being obtained for
 any other sums due under or in respect of this Guarantee and the term rate of exchange includes any premium
 and costs of exchange payable in connection with the purchase of the first
 currency with the second currency.
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|4     |  | Representations
 and warranties                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|4.1   |  | Continuing
 representations and warranties                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |  | The Guarantor represents and
 warrants that:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|4.1.1 |  | Due incorporation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |  | the Guarantor is duly
 incorporated and validly existing under the laws of the Marshall Islands as a
 Marshall Islands corporation and has power to carry on its business as it is
 now being conducted and to own its property and other assets;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|4.1.2 |  | Corporate power to guarantee                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |  | the Guarantor has power to
 execute, deliver and perform its obligations under this Guarantee and under
 the other Security Documents to which it is or is to be a party; all
 necessary corporate, shareholder and other action has been taken to authorise
 the execution, delivery and performance of the same and no limitation on the
 powers of the Guarantor to borrow or give guarantees will be exceeded as a
 result of this Guarantee;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|4.1.3 |  | Binding obligations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |  | this Guarantee and each of the
 other Security Documents to which it is or is to be a party constitutes valid
 and legally binding obligations of the Guarantor enforceable in accordance
 with its terms;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

9

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|       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|------ |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.1.4  |  | No conflict with other
 obligations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|       |  | the execution and delivery of,
 the performance of its obligations under, and compliance with the provisions
 of, this Guarantee and each of the other Security Documents to which it is or
 is to be a party, by the Guarantor will not (i) contravene any existing
 applicable law, statute, rule or regulation or any judgment, decree or permit
 to which the Guarantor is subject, (ii) conflict with, or result in any
 breach of any of the terms of, or constitute a default under, any agreement
 or other instrument to which the Guarantor is a party or is subject or by
 which it or any of its property is bound, (iii) contravene or conflict with
 any provision of the Guarantors constitutional documents or (iv) result in
 the creation or imposition of or oblige the Guarantor to create any Encumbrance
 on any of the Guarantors undertakings, assets, rights or revenues;
|       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|4.1.5  |  | No litigation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|       |  | no litigation, arbitration or
 administrative proceeding is taking place, pending or, to the knowledge of
 the officers of the Guarantor, threatened against the Guarantor or any of its
 Subsidiaries which could have a material adverse effect on the business,
 assets or financial condition of the Guarantor;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|4.1.6  |  | No filings required                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|       |  | it is not necessary to ensure
 the legality, validity, enforceability or admissibility in evidence of this
 Guarantee or any of the other Security Documents to which the Guarantor is or
 is to be a party, that it or any other instrument be notarised, filed,
 recorded, registered or enrolled in any court, public office or elsewhere in
 any Relevant Jurisdiction or that any stamp, registration or similar tax or
 charge be paid in any Relevant Jurisdiction on or in relation to this
 Guarantee or any of the other Security Documents to which the Guarantor is or
 is to be a party and this Guarantee is in proper form for its enforcement in
 the courts of each Relevant Jurisdiction;                                                                                                                                                                                         
|       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|4.1.7  |  | Choice of law                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|       |  | the choice by the Guarantor of
 English law to govern this Guarantee or any of the other Security Documents
 to which the Guarantor is or is to be a party and the submission by the
 Guarantor to the non-exclusive jurisdiction of the English courts are valid
 and binding;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|4.1.8  |  | No immunity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|       |  | neither the Guarantor nor any of
 its assets is entitled to immunity on the grounds of sovereignty or otherwise
 from any legal action or proceeding (which shall include, without limitation,
 suit, attachment prior to judgment, execution or other enforcement);                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|4.1.9  |  | Consents obtained                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|       |  | every consent, authorisation,
 licence or approval of, or registration with or declaration to, governmental
 or public bodies or authorities or courts required by the Guarantor to
 authorise, or required by the Guarantor in connection with, the execution,
 delivery, validity, enforceability or admissibility in evidence of this
 Guarantee or any of the other Security Documents to which the Guarantor is or
 is to be a party, or the performance by the Guarantor of its obligations
 under this Guarantee or any of the other Security Documents to which the
 Guarantor is or is to be a party, has been obtained or made and is in full
 force and effect and there has been no default in the observance of the
 conditions or restrictions (if any) imposed in, or in connection with, any of
 the same; and                                                                      
|       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|4.1.10 |  | No material adverse change                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|       |  | there has been no material
 adverse change in the financial position of the Guarantor or the consolidated
 financial position of the Group from that described by or on behalf of the
 Borrowers and/or the Guarantor to the Bank in the negotiation of this
 Guarantee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

10

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|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|----- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.2   |  | Initial
 representations and warranties                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | The Guarantor further represents
 and warrants that:                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|4.2.1 |  | Pari passu                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | the obligations of the Guarantor
 under this Guarantee are direct, general and unconditional obligations of the
 Guarantor and rank at least pari passu with all other present and future
 unsecured and unsubordinated Indebtedness of the Guarantor with the exception
 of any obligations which are mandatorily preferred by law and not by
 contract;                                                                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|4.2.2 |  | No default under other
 Indebtedness                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | the Guarantor is not (nor would
 with the giving of notice or lapse of time or the satisfaction of any other
 condition or any combination thereof be) in breach of or in default under any
 agreement relating to Indebtedness to which it is a party or by which it may
 be bound;                                                                                                                                                                                                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|4.2.3 |  | Information                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | the information, exhibits and
 reports furnished by the Guarantor to the Bank in connection or with the
 negotiation and preparation of this Guarantee are true and accurate in all
 material respects and not misleading, do not omit material facts and all
 reasonable enquiries have been made to verify the facts and statements
 contained therein; there are no other facts the omission of which would make
 any fact or statement therein misleading;                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|4.2.4 |  | No withholding Taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | no Taxes are imposed by
 withholding or otherwise on any payment to be made by the Guarantor under
 this Guarantee or any of the other Security Documents to which the Guarantor
 is or is to be a party, or are imposed on or by virtue of the execution or
 delivery by the Guarantor of this Guarantee or any of the other Security
 Documents to which the Guarantor is or is to be a party or any document or
 instrument to be executed or delivered under this Guarantee or such Security
 Documents;
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|4.2.5 |  | No Default                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | no Default has
 occurred and is continuing; and                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|4.2.6 |  | Shareholdings                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | the Borrower is a wholly-owned
 direct Subsidiary of the Guarantor and as of the date of this Guarantee no
 less than 75% of all the issued share capital of the Guarantor are ultimately
 beneficially owned by the Hadjioannou Family.                                                                                                                                                                                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|4.3   |  | Repetition of
 representations and warranties                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | On and as of each day from the
 date of this Guarantee until all moneys due or owing, whether actually or
 contingently, under the Agreement and/or the other Security Documents
 (including this Guarantee) have been paid in full and while all or any part
 of the Commitment remains outstanding, the Guarantor shall:                                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|4.3.1 |  | be deemed to repeat the representations
 and warranties in clause 4.1 as if made with reference to the facts and
 circumstances existing on such day; and                                                                                                                                                                                                                                                                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|4.3.2 |  | be deemed to further represent
 and warrant to the Bank that the then latest audited financial statements
 delivered to the Bank under this Guarantee (if any) have been prepared in
 accordance with the Applicable Accounting Principles which have been
 consistently applied and present fairly and accurately the consolidated
 financial position of the Group as at the end of the                                                                                                                   

11

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|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                      
|----- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |  | financial period to which the
 same relate and the consolidated results of the operations of the Group for
 the financial period to which the same relate and, as at the end of such
 financial period, neither the Guarantor nor any other member of the Group had
 any significant liabilities (contingent or otherwise) or any unrealised or
 anticipated losses which are not disclosed by, or reserved against or
 provided for in, such financial statements.                                                                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                      
|5     |  | Undertakings                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                      
|5.1   |  | General                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                      
|      |  | The Guarantor undertakes that,
 from the date of this Guarantee and so long as any moneys are owing, whether
 actually or contingently, under the Agreement or the other Security Documents
 (including this Guarantee) and while all or any part of the Commitment
 remains outstanding, it will:                                                                                                                                                                                                                                                         
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                      
|5.1.1 |  | Notice of default                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                      
|      |  | promptly inform the Bank of any
 occurrence of which it becomes aware which might adversely affect its ability
 to perform its obligations under this Guarantee and each of the other
 Security Documents to which the Guarantor is or is to be a party, and of any
 Default forthwith upon becoming aware thereof and will from time to time, if
 so requested by the Bank, confirm to the Bank in writing that, save as
 otherwise stated in such confirmation, no Default has occurred and is
 continuing;                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                      
|5.1.2 |  | Consents and licences                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                      
|      |  | without prejudice to clause 4.1,
 obtain or cause to be obtained, maintain in full force and effect and comply
 in all material respects with the conditions and restrictions (if any) imposed
 in, or in connection with, every consent, authorisation, licence or approval
 of governmental or public bodies or authorities or courts and do, or cause to
 be done, all other acts and things which may from time to time be necessary
 or desirable under applicable law for the continued due performance of all
 its obligations under this Guarantee;
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                      
|5.1.3 |  | Pari passu                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                      
|      |  | ensure that its obligations
 under this Guarantee shall, without prejudice to the provisions of clause
 5.2, at all times rank at least pari passu with all its other present and
 future unsecured and unsubordinated Indebtedness with the exception of any
 obligations which are mandatorily preferred by law and not by contract;                                                                                                                                                                                                                     
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                      
|5.1.4 |  | Financial statements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                      
|      |  | prepare or cause to be prepared:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                      
|      |  | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | audited consolidated financial
 statements of the Group in accordance with the Applicable Accounting
 Principles consistently applied in respect of each financial year;                             
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                      
|      |  | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | unaudited consolidated financial
 statements of the Group in accordance with the Applicable Accounting
 Principles consistently applied in respect of each financial half-year; and                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                      
|      |  | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | unaudited consolidated financial
 statements of the Group in accordance with the Applicable Accounting
 Principles consistently applied in respect of each financial quarter of each
 financial year,
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                      
|      |  | and, in each case, deliver as
 many copies of the same as the Bank may reasonably require as soon as
 practicable but not later than one hundred and eighty (180) days (in the case
 of audited                                                                                                                                                                                                                                                                                                                                                            

12

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|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |  | statements) and ninety (90) days
 (in the case of unaudited statements) after the end of the financial period
 to which they relate;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|5.1.5 |  | Valuations and Compliance
 Certificate                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | deliver or cause to be delivered
 to the Bank valuations (dated not earlier than 30 days previously) of each
 Fleet Vessel prepared in accordance with, and in the manner specified in,
 clause 9.2.2 of the Agreement (at the cost of the Guarantor) at the time when
 any annual or semi-annual consolidated financial statements of the Group are
 delivered to the Bank in accordance with clause 5.1.4 (and clause 9.2.2 of
 the Agreement shall apply mutatis mutandis hereto for the purpose of the
 valuation of Fleet Vessels); and
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | deliver to the Bank, a Compliance
 Certificate for the relevant period executed by the Guarantor and
 counter-signed by the Chief Financial Officer of the Guarantor and by the
 Borrower, at the time when any consolidated financial statements of the Group
 are delivered to the Bank in accordance with clause 5.1.4; and                                                                                                                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | no less than ten (10) days
 before the Guarantor intends to declare dividends, advise the Bank in writing
 of the proposed amount of such dividends and confirm to the Bank in writing,
 in a certificate duly signed by the Guarantor and the Borrower that no Event
 of Default has occurred or will occur as a result of the declaration or
 payment of such dividends;                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|5.1.6 |  | Delivery of reports                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | deliver to the Bank copies of
 every report, circular, notice or like document issued by the Guarantor to
 its shareholders or creditors generally subject to applicable obligations of
 confidentiality or rules of the New York Stock Exchange; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|5.1.7 |  | Provision of further information                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | provide the Bank with such
 financial or other information concerning the Group, the Borrower, the
 Guarantor, the other Security Parties, the other members of the Group and
 their respective affairs as the Bank may from time to time reasonably
 require, including, without limitation, any management information,
 information relating to the position, trading and/or employment of the Ship
 and any actual or proposed purchase of vessels by any member of the Group,
 copies of all documents required of the Guarantor or its board of directors
 to disclose or certify or to file with the Securities and Exchange Commission
 of the U.S.A. or pursuant to the Sarbanes-Oxley Act of the U.S.A. and any
 other documents or information as may be reasonably required by the Bank.
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|5.2   |  | Negative
 undertakings                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | The Guarantor undertakes that,
 from the date of this Guarantee and so long as any moneys are owing under the
 Agreement or the other Security Documents (including this Guarantee) and
 while all or any part of the Commitment remains outstanding, it will not,
 without the prior written consent of the Bank:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|5.2.1 |  | Negative pledge                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  | permit any Encumbrance (other
 than a Permitted Encumbrance) to subsist, arise or be created or extended
 over all or any of the shares of the Borrower to secure or prefer any present
 or future Indebtedness of the Guarantor or any other person;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

13

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|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|----- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------
|5.2.2 |  | No merger                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|      |  | merge or consolidate with any
 other person or enter into any demerger, amalgamation or any corporate
 reconstruction or redomiciliation of any kind;                                                                                                                                                                                                                                                                                                                                                                                                                                            
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|5.2.3 |  | Other business                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|      |  | undertake any
 business other than that conducted by it at the date of this Guarantee;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|5.2.4 |  | Distributions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|      |  | declare or pay any dividends or
 make any other distributions to any of its shareholders if an Event of
 Default has occurred or will or, in the opinion of the Bank, is likely to
 occur as a result of, or following, the declaration or payment of such
 dividends or other distributions;                                                                                                                                                                                                                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|5.2.5 |  | Shareholdings                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|      |  | change, cause or permit any
 change in, the legal and/or beneficial ownership of any of the shares in the
 Borrower which would result in the Borrower ceasing to be a wholly-owned
 direct Subsidiary of the Guarantor; or                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|5.2.6 |  | Financial year                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|      |  | change the computation of its
 financial year from that existing on the date of this Guarantee (i.e. with
 financial year-end on 31 December).                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|5.3   |  | Financial
 undertakings                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|5.3.1 |  | The Guarantor undertakes with
 the Bank that, from the date of this Guarantee and so long as any moneys are
 owing under the Security Documents (including this Guarantee) and while all
 or any part of the Commitment remains outstanding, it will ensure that:                                                                                                                                                                                                                                                                                                                                
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|      |  | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | Consolidated Adjusted Net Worth                                                                                     
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | the Consolidated Adjusted Net
 Worth shall not be less than Two hundred million Dollars ($200,000,000) at
 any time;
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|      |  | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | Consolidated Adjusted Leverage
 Ratio                                                                               
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | the Consolidated Adjusted
 Leverage Ratio shall not be higher than 0.70:1.0 at any time; and                        
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|      |  | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | Consolidated Debt Service Ratio                                                                                     
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | the Consolidated Debt Service
 Ratio shall not be higher than 5.5:1.0 at any time.                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|5.3.2 |  | All the terms defined in clause
 1.2 and used in this clause 5.3, and other accounting terms used in this
 clause 5.3, are to be determined by the Bank on a consolidated basis and
 (except as items are expressly included or excluded in the relevant
 definition or provision) are used and shall be construed in accordance with
 the Applicable Accounting Principles consistently applied and as determined
 from any relevant Accounting Information and any valuations of the Fleet
 Vessels and also by reference to any other information available to the Bank
 at any relevant time.
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                     
|5.3.3 |  | Subject to clause 5.3.4, the
 compliance of the Guarantor with the undertakings set out in clause 5.3.1
 shall be determined and tested by the Bank in its sole discretion on the
 basis of calculations made by the Bank at the end of each Accounting Period
 at the time when the relevant Accounting Information and, where applicable,
 valuations of the Fleet Vessels have been delivered to the Bank pursuant to
 clause 5.1.4 and clause 5.1.5.                                                                                                                                         

14

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|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|----- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|5.3.4 |  | Notwithstanding the other terms
 of this clause 5.3 and, in particular, the time when compliance with the
 financial undertakings of clause 5.3.1 is to be tested by the Bank pursuant
 to clause 5.3.3, the Guarantor hereby undertakes that the financial
 undertakings of clause 5.3.1 will be complied with at all times during the
 whole term of each Accounting Period.                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|5.3.5 |  | For the purposes of this clause
 5.3: (i) no item shall be deducted or credited more than once in any
 calculation; and (ii) any amount expressed in a currency other than Dollars
 shall be converted into Dollars in accordance with the Applicable Accounting
 Principles consistently applied.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|6     |  | Set-off                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|      |  | The Guarantor authorises the
 Bank at any time following a demand made by the Bank under clause 2.1 and
 without notice to the Guarantor to apply any credit balance to which the
 Guarantor is then entitled on any account of the Guarantor with the Bank at
 any of its branches in or towards satisfaction of any sum then due and
 payable from the Guarantor to the Bank under this Guarantee. For this purpose
 the Bank is authorised to purchase with the moneys standing to the credit of
 such account such other currencies as may be necessary to effect such
 application. The Bank shall not be obliged to exercise any right given to it
 by this clause 6. The Bank shall notify the Guarantor forthwith upon the
 exercise or purported exercise of any right of set-off giving full details in
 relation thereto.
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|7     |  | Benefit of this
 Guarantee                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|7.1   |  | Benefit and
 burden                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|      |  | This Guarantee shall be binding
 upon the Guarantor and its successors in title and shall enure for the
 benefit of the Bank and its successors in title, Assignees and/or Transferees.
 The Guarantor expressly acknowledges and accepts the provisions of clause 16
 of the Agreement and agrees that any person in favour of whom an assignment
 or a transfer is made in accordance with such clause shall be entitled to the
 benefit of this Guarantee.                                                                                                                                                                                                                                                                                                                                                                       
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|7.2   |  | Changes in
 constitution or reorganisation of Bank                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|      |  | For the avoidance of doubt and
 without prejudice to the provisions of clause 7.1, this Guarantee shall
 remain binding on the Guarantor notwithstanding any change in the constitution
 of the Bank or its absorption in, or amalgamation with, or the acquisition of
 all or part of its undertaking or assets by, any other person, or any
 reconstruction or reorganisation of any kind, to the intent that this
 Guarantee shall remain valid and effective in all respects in favour of any
 successor in title, Assignee or Transferee of the Bank in the same manner as
 if such successor in title, Assignee or Transferee had been named in this
 Guarantee as a party instead of, or in addition to, the Bank.                                                                                                           
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|7.3   |  | No assignment
 by Guarantor                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|      |  | The Guarantor may not assign or
 transfer any of its rights or obligations under this Guarantee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|7.4   |  | Disclosure of
 information                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|      |  | The Bank may, without the
 consent of the Guarantor, disclose to a prospective assignee or transferee or
 to any other person who may propose entering into contractual relations with
 the Bank in relation to the Agreement such information about the Guarantor as
 the Bank shall consider appropriate.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|8     |  | Notices and
 other matters                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|8.1   |  | Notices                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|      |  | Clause 17.1 of the Agreement
 shall apply to this Guarantee as if set out herein and every notice, request,
 demand or other communication under this Guarantee shall be sent:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

15

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|      |  |                                                                                                                                  |                         
|----- |  | -------------------------------------------------------------------------------------------------------------------------------- | ------------------------
|8.1.1 |  | if to the Guarantor at:                                                                                                         
|      |  |                                                                                                                                 
|      |  | 32 Karamanli Avenue 166 05 Voula                                                                                                
|      |  | Greece                                                                                                                          
|      |  |                                                                                                                                 
|      |  | Fax No:                                                                                                                          | +30 210 8956900         
|      |  | Attention:                                                                                                                       | Constantinos Adamopoulos
|      |  |                                                                                                                                 
|8.1.2 |  | if to the Bank at:                                                                                                              
|      |  |                                                                                                                                 
|      |  | Bayerische Hypo- und Vereinsbank
 Aktiengesellschaft                                                                            
|      |  | 7 Heraklitou Street                                                                                                             
|      |  | 106 73 Athens Greece                                                                                                            
|      |  |                                                                                                                                 
|      |  | Fax:                                                                                                                             | +30 210 412 6597        
|      |  | Attention:                                                                                                                       | The Manager             
|      |  |                                                                                                                                 
|      |  |                                                                                                                                 
|      |  | or to such other address or
 facsimile number as is notified by the Guarantor or the Bank to the other
 party to this Guarantee.
|      |  |                                                                                                                                 

|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|8.2 |  | No implied
 waivers, remedies cumulative                                                                                                                                                                                                                                                                                                                                                                                                                  
|   
|    |  | No failure or delay on the part
 of the Bank to exercise any power, right or remedy under this Guarantee shall
 operate as a waiver thereof, nor shall any single or partial exercise by the
 Bank of any power, right or remedy preclude any other or further exercise
 thereof or the exercise of any other power, right or remedy. The remedies
 provided in this Guarantee are cumulative and are not exclusive of any
 remedies provided by law.     
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|8.3 |  | English
 translations                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |  | All certificates, instruments
 and other documents to be delivered under or supplied in connection with this
 Guarantee shall be in the English language or shall be accompanied by a
 certified English translation upon which the Bank shall be entitled to rely.                                                                                                                                                                                       
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|8.4 |  | Other
 guarantors                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |  | The Guarantor agrees to be bound
 by this Guarantee notwithstanding that any other person intended to execute
 or to be bound by any other guarantee or assurance under or pursuant to the
 Agreement may not do so or may not be effectually bound and notwithstanding
 that such other guarantee or assurance may be determined or be or become
 invalid or unenforceable against any other person, whether or not the
 deficiency is known to the Bank.
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|8.5 |  | Expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |  | The Guarantor agrees to
 reimburse the Bank on demand for all legal and other costs, charges and
 expenses on a full and unqualified indemnity basis which may be incurred by
 the Bank in relation to the enforcement of this Guarantee against the
 Guarantor.                                                                                                                                                                                          
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|8.6 |  | Partial
 invalidity                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |  | If, at any time, any provision
 of this Guarantee is or becomes illegal, invalid or unenforceable in any
 respect under any law or jurisdiction, neither the legality validity or
 enforceability of the remaining provisions nor the legality, validity or
 enforceability of such provision in any other respect or under the law of any
 other jurisdiction will be affected or impaired in any way.                                                   

16

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|                                                                                                                                                   |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|-------------------------------------------------------------------------------------------------------------------------------------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|8.7                                                                                                                                                |  | Maximum
 liability                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                   |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                   |  | Anything contained in this
 Guarantee to the contrary notwithstanding, the obligations of the Guarantor
 hereunder shall be limited to a maximum aggregate amount equal to the greatest
 amount that would not render the Guarantors obligations hereunder subject to
 avoidance as a fraudulent transfer or conveyance under Section 548 of Title
 11 of the United States Code or any similar provisions of applicable law
 (collectively, the Fraudulent Transfer
 Laws), in each case after giving effect to all other liabilities
 of the Guarantor, contingent or otherwise, that are relevant under the
 Fraudulent Transfer Laws (specifically excluding, however, any liabilities of
 the Guarantor (a) in respect of inter-company Indebtedness to the Borrower or
 any other member of the Group to the extent that such Indebtedness would be
 discharged in an amount equal to the amount paid by the Guarantor hereunder
 and (b) under any guarantee of Indebtedness subordinated in right of payment
 to the Guaranteed Liabilities, which guarantee contains a limitation as to
 maximum amount similar to that set forth in this paragraph, pursuant to which
 the liability of the Guarantor hereunder is included in the liabilities taken
 into account in determining such maximum amount) and after giving effect as
 assets to the value (as determined under the applicable provisions of the
 Fraudulent Transfer Laws) of any rights to subrogation, contribution,
 reimbursement, indemnity or similar rights of the Guarantor pursuant to (i)
 applicable law or (ii) any agreement providing for an equitable allocation
 among the Guarantor and other members of the Group of obligations arising
 under guarantees by such parties.
|                                                                                                                                                   |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|9                                                                                                                                                  |  | Law and
 jurisdiction                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                   |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|9.1                                                                                                                                                |  | Law                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                   |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                   |  | This Guarantee is governed by,
 and shall be construed in accordance with, English law.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                   |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|9.2                                                                                                                                                |  | Submission to
 jurisdiction                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                   |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                   |  | The Guarantor agrees for the
 benefit of the Bank that any legal action or proceedings arising out of or in
 connection with this Guarantee against the Guarantor or any of its assets may
 be brought in the English courts, irrevocably and unconditionally submits to
 the jurisdiction of such courts and irrevocably designates, appoints and
 empowers Mr. Savvas Savvides at present of 24 Exeter Road, London N14 5JY,
 England to receive for it and on its behalf, service of process issued out of
 the English courts in any such legal action or proceedings and the Guarantor
 further undertakes that, in the event that such individual passes away or
 cannot be found, the Guarantor hereby irrevocably and unconditionally
 authorises the Bank to designate, appoint and empower, on the Guarantors
 behalf, Messrs Cheeswrights or Messrs Saville & Co. at their then
 principal place of business in London, as substitute process agents of Mr.
 Savvas Savvides for the purposes of this clause. The submission to such
 jurisdiction shall not (and shall not be construed so as to) limit the right
 of the Bank to take proceedings against the Guarantor in the courts of any
 other competent jurisdiction, nor shall the taking of proceedings in any one
 or more jurisdictions preclude the taking of proceedings in any other
 jurisdiction, whether concurrently or not. The Guarantor further agrees that
 only the courts of England and not those of any other State shall have
 jurisdiction to determine any claim which the Guarantor may have against the
 Bank arising out of or in connection with this Guarantee.                                                                                                         
|                                                                                                                                                   |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|9.3                                                                                                                                                |  | Contracts
 (Rights of Third Parties) Act 1999                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                   |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                   |  | No term of this Guarantee is
 enforceable under the Contracts (Rights of Third Parties) Act 1999 by a
 person who is not a party to this Guarantee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                   |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|IN
 WITNESS whereof the parties to this Guarantee have caused
 this Guarantee to be duly executed as a deed on the date
      first above written.

17

---



Schedule 1

Form of Compliance Certificate

|      |                                                     
|----- | ----------------------------------------------------
|To:   | BAYERISCHE HYPO- UND VEREINSBANK
 AKTIENGESELLSCHAFT
|      |                                                     
|From: | SAFE BULKERS, INC.                                  

Dated: []

US$40,167,615.01 Loan Agreement dated 7 March 2007, as amended (the Loan
Agreement) - Corporate Guarantee dated [] 2008 (the Corporate Guarantee)

Terms
defined in the Corporate Guarantee shall have the same meaning when used
herein.

We refer
to clause 5.3.1 of the Corporate Guarantee and hereby certify that, as at [insert date of accounts] and on the date
hereof:

|        |                                                                                                                                                                                                      |                                                                                          
|------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------
|1       | Financial
 covenants                                                                                                                                                                                
|        |                                                                                                                                                                                                      |                                                                                          
|        | (a)                                                                                                                                                                                                  | the Consolidated Adjusted Net
 Worth is $[], calculated as follows: [ ]; and            
|        |                                                                                                                                                                                                      |                                                                                          
|        | (b)                                                                                                                                                                                                  | the Consolidated Adjusted
 Leverage Ratio is []:1.0, calculated as follows:[ ]; and     
|        |                                                                                                                                                                                                      |                                                                                          
|        | (c)                                                                                                                                                                                                  | the Consolidated Debt Service
 Ratio is []:1.0, calculated as follows: [ ].             
|        |                                                                                                                                                                                                      |                                                                                          
|        | [and we hereby confirm that the
 above comply with the provisions of clause 5.3.1 of the Guarantee.]                                                                                                
|        |                                                                                                                                                                                                      |                                                                                          
|2       | Default                                                                                                                                                                                             
|        |                                                                                                                                                                                                      |                                                                                          
|        | [No Default has occurred and is
 continuing]                                                                                                                                                        
|        |                                                                                                                                                                                                      |                                                                                          
|        | or                                                                                                                                                                                                  
|        |                                                                                                                                                                                                      |                                                                                          
|        | [The following Default has
 occurred and is continuing: [provide details of Default]. [The following steps are
 being taken to remedy it: [provide details of steps being taken to remedy Default]].
|        |                                                                                                                                                                                                      |                                                                                          
|Signed: |                                                                                                                                                                                                     
|        |                                                                                                                                                                                                      | [Director[s]/Officer[s]] [or any
 other duly authorised representatives [or appropriate]]
|        |                                                                                                                                                                                                      | For and on behalf of:|                                                                   
|        |                                                                                                                                                                                                      | SAFE BULKERS,
 INC.                                                                      
|        |                                                                                                                                                                                                      |                                                                                          
|        |                                                                                                                                                                                                      |                                                                                          
|Signed: |                                                                                                                                                                                                     
|        |                                                                                                                                                                                                      | [Director[s]/Officer[s]] [or any
 other duly authorised representatives [or appropriate]]
|        |                                                                                                                                                                                                      | For and on behalf of:                                                                    
|        |                                                                                                                                                                                                      | PEMER SHIPPING
 LTD                                                                      

18

---



I hereby
confirm and certify that the above statements are correct and complete.

|        |  |                        
|------- |  | -----------------------
|Signed: | 
|        |  | Chief Financial Officer
|        |  | For and on behalf of   
|        |  | SAFE BULKERS,
 INC.    

19

---



|                                  |   |                     
|--------------------------------- | - | --------------------
|EXECUTEDas a DEED                 | ) |                     
|by                                | ) |                     
|for and on behalf of              | ) |                     
|SAFE BULKERS,
 INC.               | ) |                     
|in the presence of:               | ) | Attorney-in-Fact    
|                                  |   |                     
|                                  |   |                     
|Witness                           |   |                     
|Name:                             |   |                     
|Address:                          |   |                     
|Occupation:                       |   |                     
|                                  |   |                     
|EXECUTEDas a DEED                 | ) |                     
|by                                | ) |                     
|for and on behalf of              | ) | Authorised signatory
|BAYERISCHE
 HYPO- UND VEREINSBANK | ) |                     
|AKTIENGESELLSCHAFT                | ) |                     
|in the presence of:               | ) | Authorised signatory
|                                  |   |                     
|                                  |   |                     
|Witness                           |   |                     
|Name:                             |   |                     
|Address:                          |   |                     
|Occupation:                       |   |                     

20

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