Document:

Exhibit 10.34 

Private & Confidential 

 

 

	
      Dated 23 May 2008         

 

 

 

SUPPLEMENTAL AGREEMENT 

relating to a 

loan of US$40,000,000 

to 

KERASIES SHIPPING CORPORATION 

provided by 

THE ROYAL BANK OF SCOTLAND PLC 

 

 

 

 

  

Contents 

	
Clause  	   	   	
Page  
	 	 	 	 
	
1  	
Definitions  	   	
2  
	 	 	 	 
	
2  	
Agreement of the Bank  	   	
4  
	 	 	 	 
	
3  	
Amendments  	   	
4  
	 	 	 	 
	
4  	
Representations and warranties  	   	
7  
	 	 	 	 
	
5  	
Conditions  	   	
8  
	 	 	 	 
	
6  	
Confirmation  	   	
8  
	 	 	 	 
	
7  	
Expenses  	   	
9  
	 	 	 	 
	
8  	
Miscellaneous and notices  	   	
9  
	 	 	 	 
	
9  	
Applicable law  	   	
10  
	 	 	 	 
	
Schedule 1 Documents and evidence required as conditions subsequent  	   	
12  
	 	 	 
	
Schedule 2 Form of Corporate Guarantee  	   	
14  

 

 

 

 

 

1 

THIS SUPPLEMENTAL AGREEMENT is dated 23 May 2008 and made BETWEEN: 

	
(1)          	
KERASIES SHIPPING CORPORATION, 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)          	
THE ROYAL BANK OF SCOTLAND PLC of 5-10 Great Tower Street, London EC3P 3HX, England (the “Bank”).
  

WHEREAS: 

	(A)          	this Agreement
          is supplemental to a loan agreement dated 13 December 2007 made between
          (1) the Borrower and (2) the Bank (the “Principal
          Agreement”) relating
          to a multi-currency loan of Forty million Dollars ($40,000,000) advanced
          by the Bank to the Borrower, of which the principal amount outstanding
          at the date hereof is $40,000,000; 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 transfer
          of the legal and beneficial ownership of all the shares of the Borrower
          to the Corporate Guarantor (as defined below);

	 
	 	(b)          	the Listing (as defined
          below);

	 
	 	(c)          	the change of the ultimate
          beneficial ownership of certain of the shares in the Borrower as a
          result of, and in order to facilitate, the Listing;

	 
	 	(d)          	the consent to the
          substitution of the Management Agreement by a new management agreement
          in respect of the Ship;

	 
	 	(e)          	certain amendments
          to the terms and conditions applicable to the Loan and the Principal
          Agreement agreed to by the Borrower and the Bank; and

	 
	 	(f)          	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 AGREED as 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:

  
	 
	 	
“Conditions Date” means the earlier of (a) 15 July 2008 and (b) 30 days after the Listing has taken
place;

  
	 

1

	 	
“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;

  
	 
	 	
“Effective Date” means the date when the Listing has taken place;

  
	 
	 	
“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;

  
	 
	 	
“Listing” means the successful completion of the initial public offering of approximately 20% of the
shares of the Corporate Guarantor, and the listing of the shares of the Corporate Guarantor on the New York Stock Exchange;

  
	 
	 	
“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;

  
	 

2

  

	
    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;
  
	 

	
    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) (c) and (d) 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 deleting the existing definition of “Management Agreement” in clause 1.2 and by inserting the
following definitions of “Conditions Date”, “Corporate Guarantee”, “Corporate Guarantor” “Hadjioannou Family”, “Management Agreement” and “Supplemental Agreement” in the correct alphabetical order in clause 1.2:
  
	 
	 	
““Conditions Date” has the meaning given to it in the Supplemental Agreement;

  
	 
	 	
“Corporate Guarantee” means the corporate 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 to the Supplemental Agreement;

  
	 
	 	
“Corporate Guarantor” means Safe Bulkers, Inc. of Trust Company Complex, Ajeltake Road, Ajeltake Island,
Majuro, Marshall Islands MH96960 and includes its successors in title;

  
	 

3

	 	
“Hadjioannou Family” means Mr Polys V. Hadjioannou, Mr Nikolaos V. Hadjioannou, Ms Eleni V. Hadjioannou
and Ms Maria V. Hadjioannou and their direct lineal descendants;

  
	 
	 	
“Management Agreement” means, together, the agreement made or (as the context may require) to be made
between the Corporate Guarantor and the Manager and the agreement made, or (as the context may require) to be made between the Borrower and the Manager, providing (inter alia) for the Manager to manage the Ship, as amended and supplemented from time
to time; and

  
	 
	 	
“Supplemental Agreement” means the agreement dated 23 May 2008 supplemental to this Agreement made
between (inter alios) (1) the Borrower and (2) the Bank;”;

  
	 
	
3.1.2          	
by inserting the words “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;

  
	 
	
3.1.3          	
by inserting the words “the Corporate Guarantor”, 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 “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;”;

  
	 
	
3.1.5          	
by deleting the definition of “Security Requirement” in clause 1.2 and by inserting in its place the
following new definition of “Security Requirement”:

  
	 
	 	
““Security Requirement” means the amount in Dollars (as certified by the Bank whose certificate
shall, in the absence of manifest error, be conclusive and binding on the Borrower and the Bank) which shall be equal to one hundred and twenty per cent (120%) of (i) the Loan (or the Equivalent Amount in Dollars when the Loan or part thereof is
denominated in an Optional Currency) and (ii) the cost (if any) (as certified by the Bank whose certificate shall, in the absence of manifest error, be conclusive and binding on the Borrower and the Bank) of terminating any Transaction entered into
pursuant to the Master Swap Agreement;”;

  
	 
	
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:
  
	 
	 	
(a)          	
deleting the existing clause 9.3.13 in its entirety and renumbering existing clauses 9.3.14 and 9.3.15 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 

4 

  the Borrower is a wholly-owned
      direct Subsidiary of the Corporate Guarantor and no less than 75% of all
      the issued share capital of the Corporate Guarantor are ultimately beneficially
      owned (whether directly or indirectly) by the Hadjioannou Family; and”; 

	
3.1.8          	
by deleting the words “during the three year period starting from the date of this Agreement exceeds one hundred and four per cent (104%) of the Security Requirement during that period or, at
any time thereafter exceeds one hundred and four point seventeen per cent (104.17%) of the Security Requirement during that period” in the first, second, third and fourth lines of clause 9.2.7 and by inserting in its place the words
“exceed the Security Requirement”;

  
	 
	
3.1.9          	
by adding the following words at the end of clause 11.1.3 after the words “9.2, 9.3 or 9.4”:

  
	 
	 	
“or the Corporate Guarantor commits any breach of or omits to observe any of the obligations or undertakings expressed to the assumed by it under clauses 5.1.4, 5.1.5, 5.2 or 5.3 of the
Corporate Guarantee”;

  
	 
	
3.1.10          	
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 11.1.30 and by renumbering the existing clause 11.1.28 as clause
11.1.31:

  
	 

	                   	“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 the Corporate Guarantor which results
    in: 
	 	 	 	 
	 	 	
(a)       	
the Borrower ceasing at any time to be a wholly-owned direct Subsidiary of the Corporate Guarantor; or
  
	 
	 	 	
(b)       	
the Hadjioannou Family becoming at any time the ultimate beneficial owners of less than 51% of the total issued share capital of the Corporate Guarantor; or
  
	 
	 	 	
(c)       	
any person, or persons acting in concert (other than the Hadjioannou Family), having control of the Corporate Guarantor 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
  
	 

	
3.1.11          	
Change of CEO: Mr Polys V. Hadjioannou ceases to be the Chief Executive Officer of the Corporate Guarantor at any time; or

  
	 
	
3.1.12          	
Listing: the shares of the Corporate Guarantor are de-listed or suspended from, or cease to trade (whether temporarily for longer than 3 consecutive days
or permanently) on, the New York Stock Exchange; or

  
	 
	
3.1.13          	
Conditions: the Bank has not received the documents and evidence specified in schedule 1 to the Supplemental Agreement by the Conditions Date;
or”.

  
	 
	
         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.

  
	 

5 

      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 4.1 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. The Borrower agrees with the Bank that failure by the Borrower to deliver such documents or evidence to the Bank by the Conditions Date, will constitute an Event of Default under the Principal
Agreement.

  
	 
	
       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 was 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

  
	 
	 	
The Borrower 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

	      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:

  
	 
	
7.1.1          	
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;
  
	 
	
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:

  
	 
	
    Karamanli Avenue 

        166 05 Voula 

        Greece 
  

    

 

8 

	 	   	
  Fax No:  	   	
+30 210 8956900  
	               	   	
  Attention:  	   	
George Papadopoulos  
	   
	 	
(b)            	
if to the Bank at:  
	   
	 	 	The Shipping Business Centre 

	 	   	 5-10 Great Tower Street  
	 	   	London, EC3P
      3HX  
	 	   	England  	   	   
	   
	 	   	 Fax:  	      	
+44 207 085 7132  
	 	   	Attention:  	   	
Shipping Business Centre  

	
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.

  
	 

9 

IN WITNESS whereof the parties to this Agreement have caused this Agreement to be duly executed as a deed on the date first above written. 

 

 

 

 

 

 

 

10 

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;

  
	 

11 

	
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;

  
	 
	
5          	
Listing

  
	 
	 	
evidence that the Listing has taken place; and

  
	 
	
6          	
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.

  
	 

 

 

 

 

 

12 

Schedule 2 

Form of Corporate Guarantee 

 

 

 

 

 

 

 

13 

	
EXECUTED as a DEED  	
)  	 	 
	
by  	
)  	 	                                                
	
for and on behalf of  	
)  	 	  

	
KERASIES SHIPPING CORPORATION                                	
)   	            	Attorney-in-fact
	
as Borrower  	
)  	 	 
	
in the presence of:  	
)  	 	 
	   
	   
	   
	 
    
	
Witness  	   	 	 
	
Name:  	   	 	 
	
Address:  	   	 	 
	
Occupation:  	   	 	 
	   
	   
	   
	   
	
EXECUTED as a DEED  	
)  	 	 
	
by  	
)  	 	 
	
for and on behalf of  	
)  	 	  

	
SAFETY MANAGEMENT OVERSEAS S.A.  	
)   	 	Attorney-in-fact
	
as Manager  	
)  	 	 
	
in the presence of:  	
)  	 	 
	   
	   
	 
	 

	
Witness  	   	 	 
	
Name:  	   	 	 
	
Address:  	   	 	 
	
Occupation:  	   	 	 
	   
	   
	   
	   
	
EXECUTED as a DEED  	
)  	 	 
	
by  	
)  	 	 
	
for and on behalf of  	
)  	 	  

	
THE ROYAL BANK OF SCOTLAND PLC  	
)   	 	Attorney-in-fact
	
as Bank  	
)  	 	 
	
in the presence of:  	
)  	 	 
	   
	   
	 
	 

	
Witness  	   	 	 
	
Name:  	   	 	 
	
Address:  	   	 	 
	
Occupation:  	   	 	 

 

 

14Exhibit 10.36

DATED 22 MAY 2008

MARINDOU SHIPPING CORPORATION 

(as borrower) 

-and- 

DnB NOR BANK ASA 

(as lender) 

 

 

____________________________________________________________ 

FIRST SUPPLEMENTAL AGREEMENT TO A SECURED 

REDUCING REVOLVING MULTI-CURRENCY CREDIT FACILITY 

AGREEMENT 

DATED 11 JANUARY 2008 

_____________________________________________________________ 

 

 

STEPHENSON HARWOOD 

One, St. Paul's Churchyard 

London EC4M 8SH 

Tel: 020 7329 4422 

Fax: 020 7329 7100 

Ref: 04.141 

CONTENTS 

	 		 		 		
Page
	
1	
Interpretation	 		
2
	
2	
Conditions	 		
4
	
3	
Representations and Warranties	 		
8
	
4	
Amendments to Original Facility Agreement	 		
8
	
5	
Confirmation and Undertaking	 		
26
	
6	
Communications, Law and Jurisdiction	 		
26
	
SCHEDULE 1: Form of Compliance Certificate	 		
29

i 

SUPPLEMENTAL AGREEMENT 

Dated: 22 May 2008 

BETWEEN:  

	
(1)     	
MARINDOU SHIPPING CORPORATION, a company incorporated under the laws of the Republic of Liberia whose registered office is at 80 Broad Street, Monrovia, Liberia (the "Borrower"); and
	 
	
(2)     	
DnB NOR BANK ASA, acting through its office at 20 St. Dunstan's Hill, London EC3R 8HY, England (the "Lender").

SUPPLEMENTAL TO a secured reducing revolving multi-currency credit facility agreement dated 11 January 2008 (the "Original Facility
Agreement") made between the Borrower and the Lender, on the terms and subject to the conditions of which the Lender agreed to advance to
the Borrower an aggregate amount not exceeding forty two million Dollars ($42,000,000) (the "Loan"). 

WHEREAS: 

	
(A)     	
The Borrower has informed the Lender that it wishes to enter into a series of transactions (the "Reorganization") as a result of which: (a) its shares
will cease to be wholly owned by its present shareholders; (b) the Corporate Guarantor will own 100% of the Borrower's shares; and (c) its ownership structure will change following the initial public offering of the common stock of the Corporate
Guarantor in the New York Stock Exchange (the "Offering").
	 
	
(B)     	
The Borrower has requested the Lender to proceed in amending, inter alia, clauses 13.2.17 and 14.1.8 of the Original Facility Agreement, which would otherwise be breached upon the occurrence of the Reorganization and the
Offering, and to delete, inter alia, clause 13.2.14 and to amend, inter alia, clause 13.2.13 of the Original Facility Agreement.
	 
	
(C)     	
The Lender is willing to accede to such requests as listed in Recital B above and has agreed to amend the Original Facility Agreement and the Security Documents
	 

(as applicable) on the terms and subject to the conditions contained in this Supplemental Agreement. 

IT IS AGREED THAT: 

	
1      		
Interpretation
	 
	 	
1.1     	
In this Supplemental Agreement
	 
	 	 	
1.1.1     	
"Additional Documents" means the Supplemental Agreement, the Guarantees and the Operating Account Charge.
	 
	 	 	
1.1.2     	
"Avstes" means Avstes Shipping Corporation, a company incorporated according to the laws of the Republic of Liberia or such other company which shall
be its successor in title.
	 
	 	 	
1.1.3     	
"Avstes Guarantee" means the guarantee and indemnity granted by Avstes in respect of the Indebtedness in favour of the Lender, in such form and
containing such terms and conditions as the Lender shall require.
	 
	 	 	
1.1.4     	
"Corporate Guarantee" means the guarantee and indemnity to be granted by the Corporate Guarantor in favour of the Lender.
	 
	 	 	
1.1.5     	
"Corporate Guarantor" means Safe Bulkers Inc., a company incorporated according to the laws of the Republic of Marshall Islands or such other company
which shall be its successor in title.
	 
	 	 	
1.1.6     	
"Effective Date" means the date of the Listing, such date falling no later than 30 August 2008.
	 
	 	 	
1.1.7     	
"Efragel" means Efragel Shipping Corporation, a company incorporated according to the laws of the Republic of Liberia or such other company which
shall be its successor in title.
	 

2 

	  	  	
1.1.8     	
"Efragel Guarantee" means the guarantee and indemnity granted by Efragel in respect of the Indebtedness in favour of the Lender, in such form and
containing such terms and conditions as the Lender shall require.
	 
	 	 	
1.1.9     	
"Group Guarantees" means the Efragel Guarantee, the Pelea Guarantee and the Avstes Guarantee, and "Group
Guarantee" means any one of them.
	 
	 	 	
1.1.10     	
"Group Guarantor" means any one of Efragel, Pelea or Avstes, and "Group Guarantors" means more than one of them.
	 
	 	 	
1.1.11     	
"Guarantees" means the Group Guarantees and the Corporate Guarantee and "Guarantee" means any one of them.
	 
	 	 	
1.1.12     	
"Guarantors" means the Group Guarantors and the Corporate Guarantor and "Guarantor" means any one of them.
	 
	 	 	
1.1.13     	
"Listing" the effective trading date of the shares of the Corporate Guarantor listed on the New York Stock Exchange."
	 
	 	 	
1.1.14     	
"Operating Account Charge" means the first priority deed of charge over the Operating Account to be executed by the Borrower in favour of the
Lender.
	 
	 	 	
1.1.15     	
"Pelea" means Pelea Shipping Ltd., a company incorporated according to the laws of the Republic of Liberia or such other company which shall be its
successor in title.
	 
	 	 	
1.1.16     	
"Pelea Guarantee" means the guarantee and indemnity granted by Pelea in respect of the Indebtedness in favour of the Lender, in such form and
containing such terms and conditions as the Lender shall require.
	 

3 

	 	 	1.1.17	"Side Letter" means
    a side letter evidencing the CurrentShareholders of the Corporate Guarantor on the
      date of the Listing issued by the Corporate Guarantor in favour of the
    Lender in such form as the Lender may require.
	 	 	 	 
	 	 	
1.1.18     	
"Supplemental Agreement" means this Supplemental Agreement.
	 
	 	
1.2     	
All words and expressions defined in the Original Facility Agreement and in Clause 4 of this Supplemental Agreement shall have the same meaning when used in this Supplemental Agreement unless the context otherwise requires,
and clause 1.2 of the Original Facility Agreement shall apply to the interpretation of this Supplemental Agreement as if it were set out in full.
	 
	
2      		
Conditions
	 
	 	
2.1     	
Conditions Subsequent   Initial The Borrower shall deliver or cause to be delivered to or to the order of
the Lender within five (5) Business Days from the Effective Date the following documents and evidence:
	 
	 	 	
2.1.1     	
Borrower's officer's certificate A certificate from a duly authorised officer of the Borrower confirming that none of the documents delivered to the Lender pursuant to Schedule 1 Part
I
	 
	 	 	 	
(a), (c) and (e) of the Original Facility Agreement have been amended or modified in any way since the date of their delivery to the Lender, or copies, certified by a duly authorised officer of the Borrower as true,
complete, accurate and neither amended nor revoked, of any which have been amended or modified.
	 
	 	 	
2.1.2     	
Borrower's and Guarantors' officer's certificates A certificate of a duly authorised officer of the Borrower and each Guarantor certifying that each copy document relating to it
specified in Clauses 2.1.3 (other than in respect of the Borrower) to 2.1.6 is correct, complete and in full force and effect as at a date no earlier
	 

4 

	  	  	 	
than five days prior to the date of this Supplemental Agreement and setting out the names of the directors and officers of the Borrower and the respective Guarantor.
	 
	 	 	
2.1.3     	
Constitutional Documents Copies of the constitutional documents of each Guarantor together with such other evidence as the Lender may reasonably require that the Guarantor in question
is duly incorporated in its country of incorporation and remains in existence with power to enter into, and perform its obligations under, the relevant Guarantee.
	 
	 	 	
2.1.4     	
Resolutions A copy, certified by a director or the secretary of the Security Party in question as true, complete and accurate and neither amended nor revoked, of a resolution of the
directors and, a resolution of the shareholders of each Security Party (together, where appropriate, with signed waivers of notice of any directors' or shareholders' meetings) approving, and authorising or ratifying the execution of, this
Supplemental Agreement and any document to be executed by that Security Party pursuant to this Supplemental Agreement.
	 
	 	 	
2.1.5     	
Powers of Attorney A notarially attested and legalised power of attorney of each of the Security Parties (other than the Corporate Guarantor) and a duly executed power of attorney in
respect of the Corporate Guarantor under which this Supplemental Agreement and any documents required pursuant to it are to be executed by that Security Party.
	 
	 	 	
2.1.6     	
Certificates of good standing A certificate of good standing in respect of each Security Party (if such a certificate can be obtained).
	 

5 

	  	 	
2.1.7     	
Additional Documents The Additional Documents duly executed by all parties thereto.
	 
	 	 	
2.1.8     	
Legal Opinions A legal opinion of the legal advisers of the Lender in the relevant jurisdiction, substantially in the form or forms provided to the Lender prior to signing of this
Supplemental Agreement or confirmation satisfactory to the Lender that such a legal opinion will be given.
	 
	 	 	
2.1.9     	
Other authorisations A copy of any other consent, licence, approval, authorisation or other document, opinion or assurance which the Lender considers to be necessary or desirable (if
it has notified the Security Parties accordingly) in connection with the entry into and performance of the transactions contemplated by any of the Additional Documents or for the validity and enforceability of any of the Additional
Documents.
	 
	 	 	
2.1.10     	
Side Letter The side letter evidencing the Current Shareholders of the Corporate Guarantor issued by the Corporate Guarantor in favour of the Lender in such form as the Lender may
require.
	 
	 	 	
2.1.11     	
Process agent Evidence that any process agent referred to in Clause 22.5 of the Agreement and any process agent appointed under any other Finance Document has accepted its
appointment.
	 
	 	
2.2     	
Conditions Subsequent   Additional The Borrower shall deliver or cause to be delivered to or to the order
of the Lender within thirty (30) days from the Effective Date, the following documents and evidence:–
	 
	 	 	
2.2.1     	
Legal opinions The legal opinions specified in Clause 2.1.8 as have not already provided to the Lender.
	 
	 	 	
2.2.2     	
New Management Agreement A photocopy, certified as true, accurate and complete by a director or the secretary or the duly
	 

6 

	  	 	 	authorised attorney of the Borrower of the New
    Management Agreement.
	 	 	 	 
	 	 	
2.2.3     	
New Managers' confirmation The written confirmation of the Managers that, throughout the Facility Period unless otherwise agreed by the Lender, they will remain the commercial and
technical managers of the Vessel and that they will not, without the prior written consent of the Lender, subcontract or delegate the commercial or technical management of the Vessel to any third party and confirming in terms acceptable to the
Lender that, following the occurrence of an Event of Default, all claims of the Managers against the Borrower shall be subordinated to the claims of the Lender under the Finance Documents.
	 
	 	 	
2.2.4     	
Reorganisation, Offering and Listing Evidence of the Reorganisation, the Offering and the Listing.
	 
	 	
2.3     	
Event of Default Failure of the Borrower to deliver any of the documents or evidence listed in Clause 2.1. or Clause 2.2 in accordance with the requirements thereof shall constitute
an Event of Default.
	 
	 	
2.4     	
All documents and evidence delivered to the Lender pursuant to this Clause shall:
	 
	 	 	
2.4.1     	
be in form and substance acceptable to the Lender;
	 
	 	 	
2.4.2     	
be accompanied, if required by the Lender, by translations into the English language, certified in a manner acceptable to the Lender; and
	 
	 	 	
2.4.3     	
if required by the Lender, be certified, notarised, legalised or attested in a manner acceptable to the Lender.
	 

7 

	
3      		
Representations and Warranties
	 
	 	
Each of the representations and warranties contained in clauses 12 and 13 of the Original Facility Agreement shall be deemed repeated by the Borrower at the date of this Supplemental Agreement and at the Effective Date, by
reference to the facts and circumstances then pertaining, as if references in the Finance Documents to the Agreement included the Original Facility Agreement as supplemented and amended by this Supplemental Agreement.
	 
	
4      		
Amendments to Original Facility Agreement
	 
	 	
4.1     	
With effect from that Effective Date:–
	 
	 	 	
4.1.1     	
The following additional definitions shall be added in clause 1.1 of the Original Facility Agreement, and the numerical order of the remaining definitions in such Clause shall be amended accordingly:
	 
	 	 	 	
'"Accounting Information'" means the annual financial statements and/or the quarterly financial statements to be provided by the Corporate Guarantor
to the Lender in accordance with Clauses 13.1.1 and 13.1.4."
	 
	 	 	 	
'"Avstes' means Avstes Shipping Corporation, a company incorporated according to the laws of the Republic of Liberia or such other company which shall
be its successor in title.
	 
	 	 	 	
'"Avstes Agreement' means the reducing revolving multi-currency credit facility agreement dated 17 April 2008 made between Avstes, as borrower and the
Lender, as lender, as amended and/or supplemented by a supplemental agreement dated 22 May 2008 entered into by and between Avstes and the Lender, and as the
	 

8 

	  	  	  	same
        may be further amended and/or supplemented and/or novated from time to
        time." 

     '"Avstes
          Guarantee' means the guarantee
          of Avstes referred to in Clause 11.1.7. " 

     '"Avstes
          Indebtedness' means the Indebtedness
          as such term is defined in the Avstes Agreement." 

     '"Builder' means
        IHI Amtec Co. of Tokyo, Japan." 

     '"Compliance
          Certificate' means a certificate
          substantially in the form set out in Schedule 4 in form and substance
          satisfactory to the Lender." 

     '"Consolidated
          Group Leverage' means at any relevant
          time Consolidated Total Liabilities divided by Consolidated Total Assets. " 

     '"Consolidated
          Total Assets' means, at any date,
    the aggregate of: 

	 	 	 	 	 
	 	 	 	
(a)     	
the then current market values of all vessels owned by any member of the Group (in the case of a Vessel or any other vessel, the market value shall be determined by reference only to the most recent valuation of such Vessel
or vessel in accordance with Clause 11.11);
	 
	 	 	 	
(b)     	
the then current aggregate amount of cash, Marketable Securities (but no other bonds, notes or bills and less any cash or Marketable Securities accounted for in the definition of Consolidated Total Liabilities below) and
receivables due to the Group (less provision for bad and doubtful debts) as shown in the latest financial statements; and
	 

9 

	  	  	  	
(c)     	
the book values of all other assets (other than the assets referred to in sub-paragraphs (a) and (b) hereof) as shown in such latest financial statements."
	 	 	 	 	 
	 	 	 	'"Consolidated
          Total Liabilities' means, at the
          relevant date and for a particular period, the aggregate of the consolidated
          Financial Indebtedness of the Group shown in the latest consolidated
          financial statements for the Group (excluding (i) liabilities to its
          shareholders, provided that they are subordinated on terms acceptable
          to the Lender in its discretion and (ii) debt that is fully collateralised
          by cash or Marketable Securities to which the right of access, use
          or dealing is blocked for any member of the Group solely to secure
          that debt)." 

     '"Corporate
          Guarantee' means the guarantee
          and indemnity referred to in Clause 11.1.4" 

     '"Corporate
          Guarantor' means Safe Bulkers."

     '"Current
          Shareholders' means the shareholders
          of the Corporate Guarantor who benefically hold directly or indirectly
          not less than fifty one per cent (51%) of the shares in the Corporate
          Guarantor on the date of the Listing." 

     '"Debt'
        means the aggregate (as of the date of calculation) of all obligations
        of the Group then outstanding for the payment or repayment of Financial
        Indebtedness as stated in the Accounting Information then most recently
        required to be delivered pursuant to Clauses 13.1.1 and 13.1.4 including,
    without limitation: 

	 	 	 	 
	 	 	 	
(a)     	
any amounts payable by the Group under leases, including, but not limited to, time chartering contracts, or similar arrangements over their respective periods;
	 

10 

	  	  	  	
(b)     	
any credit to the Group from a supplier of goods or under any instalment purchase or other similar arrangement;
	 
	 	 	 	
(c)     	
the aggregate amount then outstanding of liabilities and obligations of third parties to the extent that they are guaranteed by the Group;
	 
	 	 	 	
(d)     	
any contingent liabilities (including any taxes or other payments under dispute or arbitration) which have been or, under GAAP, should be recorded in the notes to the Group's financial statements; and
	 
	 	 	 	
(e)     	
any deferred tax liabilities."
	 	 	 	 	 
	 	 	 	'"EBITDA'
        on a consolidated basis of the Group means the earnings before interest,
        expenses and other financial charges, taxes, depreciation and amortization
        (for the previous period of twelve months)." 

     '"Efragel'
        means Efragel Shipping Corporation, a company incorporated according
        to the laws of the Republic of Liberia or such other company which shall
        be its successor in title." 

     "Efragel
          Agreement" means
          the reducing revolving multi-currency credit facility agreement dated
          11 January 2008 made between Efragel, as borrower and the Lender, as
          lender, as amended and/or supplemented by a supplemental agreement
          dated 22 May 2008 entered into by and between Efragel and the Lender,
          and as the same may be further amended and/or supplemented and/or novated
          from time to time." 
     '"Efragel
          Guarantee' means the guarantee
    of Efragel referred to in Clause 11.1.5. " 

	 

11 

'"Efragel Indebtedness' means the Indebtedness as such term is defined in the Efragel Agreement." 

'"GAAP' means generally accepted accounting principles in the United States of America." 

'"Group' means the Corporate Guarantor and its Subsidiaries." 

'"Group Guarantees' means the Efragel Guarantee, the Pelea Guarantee and the Avstes Guarantee, and "Group
Guarantee" means any one of them." 

'"Group Guarantors' means Efragel, Pelea and Avstes, and "Group Guarantor" means any one of them." 

'"Guarantees' means the Corporate Guarantee and the Group Guarantees and "Guarantee" means any one of them." 

'"Guarantors" means the Corporate Guarantor and the Group Guarantors, and
"Guarantor" means any one of them." 

'"Listing' means the effective trading date of the shares of the Corporate Guarantor listed on the New York Stock Exchange." 

'"Margin' means zero point seventy per cent (0.70%) per annum." 

"Marindou Guarantees" means the guarantees and indemnities to be granted by
the Borrower in favour of the Lender in respect of each of the Pelea Indebtedness, the Efragel Indebtedness and the Avstes Indebtedness and "Marindou Guarantee" means any one of them." 

'"Marketable Securities' means any bonds, stocks, notes or bills payable in a freely convertible and transferable currency and which are listed on a
stock exchange acceptable to the Lender." 

12 

'"Net Worth' means Consolidated Total Assets less Consolidated Total Liabilities." 

'"New Management Agreement' means the agreement for the commercial and technical management of the Vessel made or to be made between the Borrower and
the Managers." 

'"New Managers' Confirmation' means a letter of confirmation from the Managers in respect of the Vessel and the Borrower." 

'"Operating Account Charge' means the deed of charge referred to in Clause 11.1.8. " 

'"Owner' means Owner A or Owner B, together the "Owners"." 

'"Owner A' means a single purpose ship-owning company incorporated or to be incorporated in a jurisdiction acceptable to the Lender in its absolute
discretion and which shall be wholly owned legally and beneficially by the Corporate Guarantor and which shall be the owner of Vessel A." 

'"Owner B' means a single purpose ship-owning company incorporated or to be incorporated in a jurisdiction acceptable to the Lender in its absolute
discretion and which shall be wholly owned legally and beneficially by the Corporate Guarantor and which shall be the Owner of Vessel B." 

"Pelea' means Pelea Shipping Ltd., a company incorporated according to the laws of the Republic of Liberia or such other company which shall be its
successor in title." 

"Pelea Agreement' means the reducing revolving multi-currency credit facility agreement dated 12 June 2007 made between Pelea, as borrower and the
Lender, as lender as amended and/or supplemented by a supplemental agreement dated 22 May 2008 

13 

entered into by and between Pelea and the Lender, and as the same may be further amended and/or supplemented and/or novated from time to time." 

'"Pelea Guarantee' means the guarantee of Pelea referred to in Clause 11.1.6. ” 

'"Pelea Indebtedness' means the Indebtedness as such term is defined in the Pelea Agreement." 

'"Safe Bulkers' means Safe Bulkers Inc., a company incorporated according to the laws of the Republic of Marshall Islands or such other company which
shall be its successor in title." 

'"Side Letter' means the side letter evidencing the Current Shareholders of the Corporate Guarantor on the date of the Listing issued by the Corporate
Guarantor in favour of the Lender in such form as the Lender may require." 

'"Subsidiary' has the meaning ascribed to it by section 1159 of the Companies
Act 2006 (as the same may be amended and/or supplemented from time to time), and "Subsidiaries" shall
be interpreted accordingly." 

'"Vessel A' means the dry-bulk carrier of approximately 87,000 dwt and everything now or in the future belonging to it on board and ashore, currently
under construction by the Builder with the Builder's hull number 3255 to be named "MARTINE" and intended to be registered under a flag acceptable to the Lender in its absolute discretion in the ownership of Owner A." 

'"Vessel A Agreement' means the reducing revolving multi-currency credit facility agreement to be entered into by and between the Lender and Owner A
pursuant to which the Lender 

14 

	  	  	 	
would advance to Owner A an aggregate amount not exceeding forty five million Dollars ($45,000,000) for the purpose of, inter alia, financing part of the acquisition cost of Vessel A."
	 
	 	 	 	
'"Vessel A Indebtedness' means the Indebtedness as such term is defined in the Vessel A Agreement."
	 
	 	 	 	
'"Vessel Agreements' means Vessel A Agreement and Vessel B Agreement, "Vessel Agreement" means either of them.
	 
	 	 	 	
'"Vessel B’ means the dry-bulk carrier of approximately 87,000 dwt, currently under construction by the Builder with the Builder’s hull
number 3254, to be named "ELENI" and intended to be registered under a flag acceptable to the Lender in its absolute discretion in the ownership of Owner B."
	 
	 	 	 	
"'Vessel B Agreement' means the reducing revolving multi- currency credit facility agreement to be entered into by and between the Lender and Owner B
pursuant to which the Lender would advance to Owner B an aggregate amount not exceeding forty five million Dollars ($45,000,000) for the purpose of, inter alia, financing part of the acquisition cost of Vessel B."
	 
	 	 	 	
'"Vessel B Indebtedness' means the Indebtedness as such term is defined in the Vessel B Agreement."
	 
	 	 	
4.1.2     	
The following definitions set out in clause 1.1 of the Original Facility Agreement shall be deleted and replaced by the following new respective definitions:–
	 
	 	 	 	
'"Management Agreement' means the agreement(s) for the commercial and/or technical management of the Vessel between the Borrower and the Managers,
including, but not limited to, the New Management Agreement."
	 

15 

	  	  	 	
'"Operating Account' means the bank account opened in the name of the Borrower with the Lender and designated "Marindou Shipping
Corporation Operating Account" with account number 62597010."
	 
	 	 	 	
'"Relevant Documents" means the Finance Documents, the Management Agreement, the Managers' confirmation specified in Part I of Schedule 1 and the New
Managers' Confirmation."
	 
	 	 	 	
'"Security Documents' means the Mortgage, the Deed of Covenants, the Assignment, the Account Charge, the Operating Account Charge, the Guarantees, any
other Credit Support Documents or (where the context permits) any one or more of them and any other agreement or document which may at any time be executed by any person as security for the payment of all or any part of the Indebtedness and
"Security Document" means any one of them."
	 
	 	 	 	
'"Security Parties' means the Borrower, the Guarantors and any other Credit Support Provider and any other person who may at any time during the
Facility Period be liable for, or provide security for, all or any part of the Indebtedness, and "Security Party" means any one of them."
	 
	 	 	
4.1.3     	
In clause 11.1.2 of the Original Facility Agreement the word "and" at the end of the sentence shall be deleted.
	 
	 	 	
4.1.4     	
An additional clause 11.1.4 shall be added to the Original Facility Agreement which shall be read and construed as follows:–
	 
	 	 	 	
"11.1.4 a guarantee and indemnity from the Corporate Guarantor;"
	 
	 	 	
4.1.5     	
An additional clause 11.1.5 shall be added to the Original Facility Agreement which shall be read and construed as follows:–
	 

16 

	  	  	 	
"11.1.5 a guarantee and indemnity from Efragel;"
	 
	 	 	
4.1.6     	
An additional clause 11.1.6 shall be added to the Original Facility Agreement which shall be read and construed as follows:–
	 
	 	 	 	
"11.1.6 a guarantee and indemnity from Pelea;"
	 
	 	 	
4.1.7     	
An additional clause 11.1.7 shall be added to the Original Facility Agreement which shall be read and construed as follows:–
	 
	 	 	 	
"11.1.7 a guarantee and indemnity from Avstes; and"
	 
	 	 	
4.1.8     	
An additional clause 11.1.8 shall be added to the Original Facility Agreement which shall be read and construed as follows:–
	 
	 	 	 	
"11.1.8 a first priority deed of charge over the Operating Account and all amounts from time to time standing to the credit of it."
	 
	 	 	
4.1.9     	
Clause 12.1.14 of the Original Facility Agreement shall be deleted and replaced by the following:–
	 
	 	 	 	
"12.1.14 No established place of business in the UK or US No Security Party, other than the Corporate Guarantor, has an established place of business
in the United Kingdom or the United States of America."
	 
	 	 	
4.1.10     	
Clause 13.1 of the Original Facility Agreement shall be deleted and replaced by the following:–
	 
	 	 	 	
"13.1 Information Undertakings
	 
	 	 	 	
13.1.1     	
Financial statements The Borrower shall procure that the Corporate Guarantor supplies to the Lender as soon as the same become available, but in any event within one hundred and
eighty (180) days after the end of each
	 

17 

	  	  	 	
of its financial years, its audited consolidated financial statements for that financial year, together with a Compliance Certificate, signed by two directors of the Corporate Guarantor, setting out (in reasonable detail)
computations as to compliance with Clause 13.2.22 as at the date at which those financial statements were drawn up.
	 
	 	 	
13.1.2     	
Management accounts The Borrower or the Managers will supply to the Lender, on the Lender's request within sixty (60) days of the end of each calendar year during the Facility Period
the unaudited management accounts for the Vessel prepared by the Managers showing the income and expenditure for the Vessel for such calendar year.
	 
	 	 	
13.1.3     	
Requirements as to financial statements Each set of financial statements delivered by the Corporate Guarantor (as applicable) under Clause 13.1.1 shall be:–
	 
	 	 	 	
(a)     	
prepared using GAAP; and
	 
	 	 	 	
(b)     	
certified by a director of the Corporate Guarantor as fairly representing its financial condition as at the date at which those financial statements were drawn up.
	 
	 	 	
13.1.4     	
Interim financial statements The Borrower shall procure that the Corporate Guarantor supplies to the Lender as soon as the same become available, but in any event within ninety (90)
days after the end of each quarter during each of the Corporate Guarantor's financial years, its unaudited consolidated quarterly
	 

18 

	  	  	 	
financial statements for that quarter, together with a Compliance Certificate to be provided on a semi-annual basis, signed by two directors of the Corporate Guarantor, setting out (in reasonable detail) computations as to
compliance with Clause 13.2.22 as at the date at which those financial statements were drawn up.
	 
	 	 	
13.1.5     	
Information: miscellaneous The Borrower shall supply to the Lender:
	 
	 	 	 	
(a)     	
all documents dispatched by the Borrower to its shareholders (or any class of them) or its creditors generally at the same time as they are dispatched other than any documents that are subject to any confidentiality
restrictions pursuant to the New York Stock Exchange regulations that may prohibit such dissemination;
	 
	 	 	 	
(b)     	
promptly upon becoming aware of them, details of any litigation, arbitration or administrative proceedings which are current, threatened or pending against any Security Party, and which might, if adversely determined, have
a materially adverse effect on the business, assets, financial condition or credit worthiness of that Security Party; and
	 
	 	 	 	
(c)     	
promptly, such further information regarding the financial condition, business and operations of any Security Party as the Lender may reasonably request.
	 

19 

	  	  	
13.1.6     	
Notification of default
	 
	 	 	 	
(a)     	
The Borrower shall notify the Lender of any Default (and the steps, if any, being taken to remedy it) promptly upon becoming aware of its occurrence.
	 
	 	 	 	
(b)     	
Promptly upon a request by the Lender, the Borrower shall supply to the Lender a certificate signed by two of its directors or senior officers on its behalf certifying that no Default is continuing (or if a Default is
continuing, specifying the Default and the steps, if any, being taken to remedy it).
	 
	 	 	
13.1.7     	
"Know your customer" checks If:
	 
	 	 	 	
(a)     	
the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation made after the date of this Agreement;
	 
	 	 	 	
(b)     	
any change in the status of the Borrower after the date of this Agreement; or
	 
	 	 	 	
(c)     	
a proposed assignment or transfer by the Lender of any of its
 rights and obligations under this Agreement, obliges the Lender (or, in the case of (c) above, any prospective new Lender) to comply with "know your customer" or similar identification procedures in circumstances where the necessary information is not already
available to it, the Borrower shall promptly upon the request of the Lender supply, or procure the supply of, such documentation and other evidence as is
	 

20 

	 	 	 	 	reasonably requested by the Lender
      for itself (or, in the case of (c) above, on behalf of any prospective
      new Lender) in order for the Lender (or, in the case of (c) above, any
      prospective new Lender) to carry out and be satisfied it has complied with
      all necessary "know your customer" or other similar checks under all applicable
      laws and regulations pursuant to the transactions contemplated in the Finance
    Documents.
	 
	 	 	
4.1.11     	
Clause 13.2.6 of the Original Facility Agreement shall be deleted and replaced by the following:–
	 
	 	 	 	"13.2.6	Negative pledge and no disposals Other
      than in favour of the Lender, the Borrower shall not create nor permit
      to subsist any Encumbrance or other third party rights over any of its
      present or future assets or undertaking nor dispose of any those assets
    or of all or part of that undertaking."
	 
	 	 	
4.1.12     	
Clause 13.2.7 of the Original Facility Agreement shall be deleted and replaced by the following:–
	 
	 	 	 	"13.2.7 	Merger The
      Borrower shall not without the prior written consent of the Lender enter
      into any amalgamation, demerger, merger or corporate reconstruction other
    than the Reorganization."
	 
	 	 	
4.1.13     	
Clause 13.2.12 of the Original Facility Agreement shall be deleted and replaced by the following:–
	 
	 	 	 	"13.2.12  	No substantial liabilities Except
      in the ordinary course of business and other than in favour of the Lender,
    the Borrower shall not without the prior written consent of

21 

	  	  	 	
the Lender incur any liability to any third party which is in the Lender's opinion of a substantial nature."
	 
	 	 	
4.1.14     	
Clause 13.2.13 of the Original Facility Agreement shall be deleted and replaced by the following:–
	 	 	 	 
	 	 	 	"13.2.13  	No loans or other financial commitments The
      Borrower shall not without the prior written consent of the Lender make
      any loan nor enter into any guarantee or indemnity (other than the Marindou
      Guarantees, other than any guarantee or indemnity from time to time required
      by any insurer and which is in accordance with the terms and conditions
      of clause 5 of the Deed of Covenants, the Insurances and any acceptable
      Insurance letter of undertaking) or otherwise voluntarily assume any actual
    or contingent liability in respect of any obligation of any other person."
	 
	 	 	
4.1.15     	
Clause 13.2.14 of the Original Facility Agreement shall be deleted.
	 
	 	 	
4.1.16     	
Clause 13.2.15 of the Original Facility Agreement shall be deleted and replaced by the following:–
	 
	 	 	 	"13.2.15	Inspection of records The
      Borrower will permit the inspection of its financial records and accounts
      and procure that the Corporate Guarantor permits the inspection of the
      Corporate Guarantor's financial records and accounts from time to time
    by the Lender or its nominee."
	 
	 	 	
4.1.17     	
Clause 13.2.13 of the Original Facility Agreement shall be deleted and replaced by the following:–
	 

22 

	  	  	 	"13.2.13 	No change in ownership or control of the Borrower
        of the Managers The Borrower shall
        not cease to be a wholly owned Subsidiary of the Corporate Guarantor
        and shall not permit any change in the beneficial ownership and control
    of the Managers from that advised to the Lender on the date of the Listing."
	 
	 	 	
4.1.18     	
An additional clause 13.2.20 shall be added to the Original Facility Agreement which shall be read and construed as follows:– 
	 
	 	 	 	"13.2.20  	Ownership The
      Borrower shall procure that the Corporate Guarantor shall remain directly
      or indirectly beneficially owned by its Current Shareholders at a minimum
    of fifty one per cent (51%).”
	 
	 	 	
4.1.19     	
An additional clause 13.2.21 shall be added to the Original Facility Agreement which shall be read and construed as follows:–
	 
	 	 	 	"13.2.21 	Guarantees and indemnities The
      Borrower shall by not later than the execution date of the Vessel Agreements
      execute in favour of the Lender guarantees and indemnities in such forms
      and containing such terms and conditions as the Lender shall in its discretion
    require and which shall secure the Vessel A
	 
	 	 	 	
Indebtedness and the Vessel B Indebtedness, and shall procure that each Owner shall by not later than the execution date of the relevant Vessel Agreement grant in favour of the Lender a guarantee and indemnity in such form
and containing such terms and conditions as the Lender shall in its discretion require and which shall secure the Indebtedness."
	 

23 

	  	  	
4.1.20     	
An additional clause 13.2.22 shall be added to the Original Facility Agreement which shall be read and construed as follows:–
	 	 	 	 
	 	 	 	"13.2.22  	Financial covenants The
      Borrower shall procure that the Corporate Guarantor shall on a consolidated
      basis comply with the following financial covenants to be assessed on a
      semi-annual basis based on the Accounting Information received by the Lender
    in accordance with Clauses 13.1.1 and 13.1.4:–
	 
	 	 	 	 	(a)     	Consolidated Group Leverage The
    Consolidated Group Leverage shall be equal to or less than seventy per cent
    (70%).
	 	 	 	 	 	 
	 	 	 	 	(b)     	Debt to EBITDA ratio The
      ratio of Debt to EBITDA on a trailing twelve (12) month's basis shall not
    at any time exceed 5.5:1.
	 	 	 	 	 	 
	 	 	 	 	(c)     	Net Worth The
      Net Worth shall not at any time be less than one hundred and seventy five
    million Dollars ($175,000,000)."
	 
	 	 	
4.1.21     	
Clause 14.1.8 of the Original Facility Agreement shall be deleted and replaced by the following:–
	 	 	 	 
	 	 	 	"14.1.8 	Change in ownership
        or control of the Borrower or the Managers The
        Borrower ceases to be a wholly owned Subsidiary of the Corporate Guarantor
        or there is any change in the beneficial ownership or control of the
        Borrower or the Managers from that advised to the Lender by the Borrower
    on the date of the Listing."
	 
	 	 	
4.1.22     	
Clause 14.1.14 of the Original Facility Agreement shall be deleted and replaced by the following:–
	 

24 

	 	 	 	"14.1.14  	Reduction of capital A
      Security Party (other than the Corporate Guarantor) reduces its authorised
    or issued or subscribed capital."
	 
	 	 	
4.1.23     	
An additional clause 14.1.20 shall be added to the Original Facility Agreement which shall be read and construed as follows:–
	 
	 	 	 	"14.1.20	Notice of Termination Any
      of the Guarantors gives notice to the Lender to determine its obligations
    under the relevant Guarantee.”
	 
	 	 	
4.1.24     	
Clause 22.5 of the Original Facility Agreement shall be deleted and replaced by the following:–
	 
	 	 	 	"22.5 	Service of process Without
      prejudice to any other mode of service allowed under any relevant law,
    each Security Party:
	 
	 	 	 	 	22.5.1  	irrevocably appoints Mr. Savvas Savvides, 24
      Exeter Road, London N14 5JY, England (tel/fax: +44 208 361 2606) as its
      agent for service of process in relation to any proceedings before the
    English courts in connection with this Agreement; and
	 	 	 	 	 	 
	 	 	 	 	22.5.2  	agrees that failure by a process agent to notify
      the relevant Security Party of the process will not invalidate the proceedings
    concerned."
	 
	 	 	
4.1.25     	
All references to "this Agreement" shall be references to the Original Facility Agreement as amended and/or supplemented by this Supplemental Agreement.
	 

25 

	 	 	4.1.26 	The Schedule to this Supplemental Agreement shall
    be incorporated as "Schedule 4" to the Original Facility Agreement.
	 	 	 	 
	 	 	4.1.27	 All references in the Security Documents to
      the Agreement (however it may be defined) shall be read and construed as
    the Original Facility Agreement as supplemented and amended hereby.
	 	 	 	 
	 	 	4.1.28	 All references to the "Security Documents" shall
      be shall be read and construed to include the Guarantees and the Operating
    Account Charge.
	 
	 	 	
All other terms and conditions of the Original Facility Agreement shall remain unaltered and in full force and effect.
	 
	
5      		
Confirmation and Undertaking
	 
	 	
5.1     	
Each of the Security Parties confirms that all of its respective obligations under or pursuant to each of the Security Documents to which it is a party remain in full force and effect, despite the amendments to the Original
Facility Agreement made in this Supplemental Agreement, as if all references in any of the Security Documents to the Facility Agreement (however described) were references to the Original Facility Agreement as amended and supplemented by this
Supplemental Agreement.
	 
	 	
5.2     	
The definition of any term defined in any of the Security Documents shall, to the extent necessary, be modified to reflect the amendments to the Original Facility Agreement made in this Supplemental Agreement.
	 
	
6      		
Communications, Law and Jurisdiction
	 
	 	
The provisions of clauses 18 and 22 of the Original Facility Agreement shall apply to this Supplemental Agreement as if they were set out in full and as if references to the Facility Agreement were references to this
Supplemental Agreement and references to the Borrower were references to the Security Parties.
	 

26 

IN WITNESS of which the parties to this Supplemental Agreement have executed this Supplemental Agreement as a deed the day and year first before written. 

	
SIGNED and DELIVERED as	
)	 
	
a DEED by	
)	 
	
MARINDOU SHIPPING CORPORATION	
)	 
	 	
	
acting by Ioannis Foteinos	
)	 
	 		 		
)	 
	
its duly authorised attorney-in-fact	
)	 
	 		 		
)	 
	
in the presence of	
)	 
	 	
	 	
	 	
	 	
	
SIGNED and DELIVERED as	
)	 
	
a DEED by	
)	 
	
DnB NOR BANK ASA	
)	 
	 		 		
)	 
	
acting by Sofia Taonaki	
)	 
	 		 		
)	 
	
its duly authorised attorney-in-fact	
)	 
	 		 		
)	 
	
in the presence of:	
)	 
	 	
	
/s/	 	 		 
	
STEPHENSON HARWOOD	 		 
	
ARISTON BUILDING	 		 
	
2 FILELLINON STR. & AKTI MIAOULI	 		 
	
PIRAEUS 185 36	 		 
	
VAT. No. 998711156	 		 		 
	
      TEL 210 42 95 160	 		 

27 

SCHEDULE 

Form of Compliance Certificate 

	
To:	
DnB NOR BANK ASA
	 	 
	
From:	
Safe Bulkers Inc.

Dated: 

Dear Sirs 

Marindou Shipping Corporation — US$42,000,000 Reducing revolving multi-currency credit facility agreement dated 11 January 2008 as amended, supplemented, novated and/or replaced from time to time (the "Agreement")

We refer to the Agreement. This is a Compliance Certificate. Terms defined in the Agreement have the same meaning when used in this Compliance Certificate unless given a different meaning in this Compliance Certificate.

The covenant calculations below are made as of, and in respect of the six (6) month period ending on [                                   ]. 

We confirm that: 

	Agreement Clause	 	Covenant determination/Calculation
        compliance	 	 	                      (min/max
          amount)
	 
	13.2.23(a)	 	Consolidated Group Leverage	 	 	 	 	 
	 	 	Consolidated Total Liabilities	 	 	USD[	 	]
	 	 	÷ Consolidated Total Assets	 	 	USD[	 	]
	 	 	= Consolidated Group Leverage	 	[	 	%]	          [maximum
        70%]
	 	 	 	 	 	 	 	 
	13.2.23(b)	 	Debt to EBITDA ratio	 	 	 	 	 
	 	 	Debt	 	 	USD[	 	]
	 	 	÷ EBITDA	 	 	USD[	 	]
	 	 	= Debt to EBITDA ratio	 	[	 	%]	          [maximum
        5.5:1]
	 	 	 	 	 	 	 	 
	13.2.23(c)	 	Net Worth	 	 	 	 	 
	 	 	÷ Consolidated Total Assets	 	 	USD[	 	]
	 	 	(minus) Consolidated Total Liabilities	 	 	USD[	 	]
	 	 	= Net Worth	 	[	 	%]	          [min.
        USD175,000,000]

28 

[We confirm that no Default is continuing.]* 

	
Signed:	 		 		
Signed:	 	
	 		
Director	 		 		
Director
	 		
of	 		 		
of
	 		
Safe Bulkers Inc.	 		 		
Safe Bulkers Inc.

 

     * If this statement cannot be made, the certificate should identify any Default that is continuing and the steps, if any, being taken to remedy it.

29

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