Document:

Exhibit 10.2

 

SECURITY AGREEMENT

 

THIS SECURITY AGREEMENT (this “Agreement”), dated as of February 26, 2018, is executed by Jaguar Health, Inc., a Delaware corporation (“Debtor”), in favor of Chicago Venture Partners, L.P., a Utah limited partnership (“Secured Party”).

 

A.            Debtor has issued to Secured Party a certain Secured Promissory Note of even date herewith, as may be amended from time to time, in the original face amount of $2,240,909.00 (the “Note”).

 

B.            In order to induce Secured Party to extend the credit evidenced by the Note, Debtor has agreed to enter into this Agreement and to grant Secured Party a security interest in the Collateral (as defined below).

 

NOW, THEREFORE, in consideration of the above recitals and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, Debtor hereby agrees with Secured Party as follows:

 

1.             Definitions and Interpretation. When used in this Agreement, the following terms have the following respective meanings:

 

“Collateral” has the meaning given to that term in Section 2 hereof.

 

“Effective Date” means the date on which Secured Party: (a) purchases the Hercules Debt from Hercules pursuant to the purchase option set forth in Section 4 of the Subordination Agreement; or (b) Debtor repays the Hercules Debt in full.

 

“Hercules” means Hercules Technology Growth Capital, Inc., a Maryland corporation.

 

“Hercules Debt” means all amounts owing to Hercules pursuant to the Hercules Loan Agreement and all other related documentation.

 

“Hercules Loan Agreement” means that certain Loan and Security Agreement dated August 18, 2015 entered into by and between Debtor and Hercules, as amended.

 

“Intellectual Property” means all patents, trademarks, service marks, trade names, copyrights, trade secrets, licenses (software or otherwise), information,  know-how,  inventions, discoveries, published and unpublished works of authorship, processes, any and all other proprietary rights, and all rights corresponding to all of the foregoing throughout the world, now owned and existing or hereafter arising, created or acquired.

 

“Lien” shall mean, with respect to any property, any security interest, mortgage, pledge, lien, claim, charge or other encumbrance in, of, or on such property or the income therefrom, including, without limitation, the interest of a vendor or lessor under a conditional sale agreement, capital lease or other title retention agreement, or any agreement to provide any of the foregoing, and the filing of any financing statement or similar instrument under the UCC or comparable law of any jurisdiction.

 

“Obligations” means (a) all loans, advances, future advances, debts, liabilities and obligations, howsoever arising, owed by Debtor to Secured Party or any affiliate of Secured Party of every kind and description, now existing or hereafter arising, created by the Note, this Agreement, that certain Securities Purchase Agreement of even date herewith, entered into by and between Debtor and Secured Party (the “Purchase Agreement”), any other Transaction Documents (as defined in the Purchase Agreement), or any modification or amendment to any of the foregoing, (b) all reasonable and

 

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documented out-of-pocket costs and expenses, including reasonable and documented attorneys’ fees, incurred by Secured Party or any affiliate of Secured Party in connection with the Note or in connection with the collection or enforcement of any portion of the indebtedness, liabilities or obligations described in the foregoing clause (a) to the extent requested to be reimbursed by the Debtor pursuant to the terms of the Transaction Documents, (c) the payment of all other sums, with interest thereon, advanced in accordance herewith to protect the security of this Agreement, and (d) the performance of the covenants and agreements of Debtor contained in this Agreement and all other Transaction Documents.

 

“Permitted Indebtedness” means (a) indebtedness of Debtor in favor of Secured Party arising under this Agreement or any other Transaction Document; (b) indebtedness to trade creditors incurred in the ordinary course of business, including indebtedness incurred in the ordinary course of business with corporate credit cards; (c) indebtedness consisting of financing of insurance premiums incurred in the ordinary course of business; (d) other indebtedness in an amount not to exceed $250,000 at any time outstanding; (e) indebtedness consisting of capital leases and purchase money debt in an amount not to exceed $300,000 at any time outstanding; (f) reimbursement obligations in connection with letters of credit that are secured by cash and issued on behalf of Debtor or a subsidiary thereof in an amount not to exceed $300,000 at any time outstanding; and (g) extensions, refinancings and renewals of any items of Permitted Indebtedness, provided that the principal amount is not increased or the terms modified to impose materially more burdensome terms upon Debtor.

 

“Permitted Liens” means (a) Liens for taxes, fees, assessment or other governmental charges or levies, either not yet delinquent or being contested in good faith and by appropriate proceedings for which adequate reserves have been established; (b) Liens in favor of Secured Party under this Agreement or arising under the other Transaction Documents; (c) Liens securing claims or demands of materialmen, artisans, mechanics, carriers, warehousemen, landlords and other like persons arising in the ordinary course of Debtor’s business and imposed without action of such parties; provided, that the payment thereof is not yet required; (d) Liens arising from judgments, decrees or attachments in circumstances which do not constitute an Event of Default hereunder; (e) the following deposits, to the extent made in the ordinary course of business:  deposits under worker’s compensation, unemployment insurance, social security and other similar laws, or to secure the performance of bids, tenders or contracts (other than for the repayment of borrowed money) or to secure indemnity, performance or other similar bonds for the performance of bids, tenders or contracts (other than for the repayment of borrowed money) or to secure statutory obligations (other than Liens arising under ERISA or environmental Liens) or surety or appeal bonds, or to secure indemnity, performance or other similar bonds; (f) Liens on equipment or software or other Intellectual Property constituting purchase money Liens;  (g) leasehold interests in leases or subleases and licenses granted in the ordinary course of business and not interfering in any material respect with the business of the licensor; (h) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of custom duties that are promptly paid on or before the date they become due; (i) Liens on insurance proceeds securing the payment of financed insurance premiums that are promptly paid on or before the date they become due (provided that such Liens extend only to such insurance proceeds and not to any other property or assets); (j) statutory and common law rights of set-off and other similar rights as to deposits of cash and securities in favor of banks, other depository institutions and brokerage firms; (k) easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course of business so long as they do not materially impair the value or marketability of the related property; (l) customary liens securing capital leases on the assets financed thereby; (m) liens on cash securing letters of credit; and (n) Liens incurred in connection with the extension, renewal or refinancing of indebtedness secured by Liens of the type described in clauses (a) through (n) above; provided, that any extension, renewal or replacement Lien shall be limited to the property encumbered by the existing Lien and the principal amount of the indebtedness being extended, renewed or refinanced (as may have been reduced by any payment thereon) does not increase.

 

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“Subordination Agreement” means that certain Subordination and Option Agreement of even date herewith entered into by and among Hercules, Secured Party and Debtor.

 

“UCC” means the Uniform Commercial Code as in effect in the state whose laws would govern the security interest in, including without limitation the perfection thereof, and foreclosure of the applicable Collateral.

 

Unless otherwise defined herein, all terms defined in the UCC have the respective meanings given to those terms in the UCC.

 

2.             Grant of Security Interest. As security for the Obligations, Debtor hereby pledges to Secured Party and grants to Secured Party a security interest in all right, title, interest, claims and demands of Debtor in and to the property described in Schedule A hereto, and all replacements, proceeds, products, and accessions thereof (collectively, the “Collateral”). Notwithstanding anything herein to the contrary, the foregoing grant of security interest shall not be effective until the Effective Date at which time such grant of security interest will immediately and automatically become effective without the need for any further action by Debtor or Secured Party.

 

3.             Authorization to File Financing Statements. Debtor hereby irrevocably authorizes Secured Party at any time on or after the Effective Date to file with the Secretary of State of the State of Delaware (as well as any other state (if any) in which Debtor incorporates while the Obligations remain outstanding) any financing statements or documents having a similar effect and amendments thereto that provide any other information required by the Uniform Commercial Code (or similar law of any non-United States jurisdiction, if applicable) of such state or jurisdiction for the sufficiency or filing office acceptance of any financing statement or amendment, including whether Debtor is an organization, the type of organization and any organization identification number issued to Debtor. Debtor agrees to furnish any such information to Secured Party promptly upon Secured Party’s request.

 

4.             General Representations and Warranties. Debtor represents and warrants to Secured Party that (a) Debtor is the owner of the Collateral and that no other person has any right, title, claim or interest (by way of Lien or otherwise) in, against or to the Collateral, other than Permitted Liens, (b) so long as the Effective Date has occurred, upon the filing of UCC-1 financing statements with the Delaware Secretary of State, Secured Party shall have a perfected first-position security interest in the Collateral to the extent that a security interest in the Collateral can be perfected by such filing, except for Permitted Liens, (c) Debtor has received at least a reasonably equivalent value in exchange for entering into this Agreement, (d) Debtor is not insolvent, as defined in any applicable state or federal statute, nor will Debtor be rendered insolvent by the execution and delivery of this Agreement to Secured Party; and (e) as such, this Agreement is a valid and binding obligation of Debtor, except as may be limited by applicable bankruptcy, insolvency or similar laws affecting creditor rights and by general principles of equity.

 

5.             Additional Covenants.  Commencing on the date hereof, Debtor hereby agrees not to grant a security interest in any of its assets without Secured Party’s prior written consent. Commencing upon and following the occurrence of the Effective Date, Debtor hereby agrees:

 

5.1.         to perform all acts that may be necessary to maintain, preserve, protect and perfect in the Collateral, the Lien granted to Secured Party therein, and the perfection and priority of such Lien solely to the extent (i) Debtor determines to do so in the exercise of its business judgment or (ii) with respect to perfection, such perfection is required hereunder;

 

5.2.         to procure, execute (including endorse, as applicable), and deliver from time to time any endorsements, assignments, and financing statements reasonably deemed necessary or appropriate by Secured Party to perfect, maintain and protect Secured Party’s Lien hereunder and the priority thereof;

 

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5.3.         to provide at least fifteen (15) days prior written notice to Secured Party of any of the following events: (a) any changes or alterations of Debtor’s name, (b) any changes with respect to Debtor’s address or principal place of business, and (c) the formation of any subsidiaries of Debtor;

 

5.4.         upon the occurrence of an Event of Default (as defined in the Note) under the Note and, solely during the existence thereof, at Secured Party’s request, to endorse (up to the outstanding amount under such promissory notes at the time of Secured Party’s request), assign and deliver any promissory notes and all other instruments, documents, or writings included in the Collateral to Secured Party, accompanied by such instruments of transfer or assignment duly executed in blank as Secured Party may from time to time specify;

 

5.5.         not to sell or otherwise dispose, or offer to sell or otherwise dispose, of the Collateral or any interest therein (other than inventory in the ordinary course of business);

 

5.6.         not to, directly or indirectly, allow, grant or suffer to exist any Lien upon any of the Collateral, other than Permitted Liens;

 

5.7.         not to incur any indebtedness (other than Permitted Indebtedness) without Secured Party’s prior written consent;

 

5.8.         not to grant any license or sublicense under any of its Intellectual Property, or enter into any other agreement with respect to any of its Intellectual Property, except in the ordinary course of Debtor’s business;

 

5.9.         to the extent commercially reasonable and in Debtor’s good faith business judgment: (a) to file and prosecute diligently any material patent, trademark or service mark applications pending as of the date hereof or hereafter until all Obligations (other than contingent and indemnification obligations) shall have been paid in full, (b) to make application on unpatented but patentable material inventions and on trademarks and service marks, (c) to preserve  and maintain all rights in all of its material Intellectual Property, and (d) to ensure that all of its material Intellectual Property is and remains enforceable. Any and all costs and expenses incurred in connection with each of Debtor’s obligations under this Section 5.9 shall be borne by Debtor. Debtor shall not knowingly and unreasonably abandon any right to file a material patent, trademark or service mark application, or abandon any pending patent application, or any other of its material Intellectual Property, without the prior written consent of Secured Party except for Intellectual Property that Debtor determines, in the exercise of its good faith business judgment, is not or is no longer material to its business; and

 

5.10.       upon the reasonable request of Secured Party at any time or from time to time, and at the sole cost and expense (including, without limitation, reasonable attorneys’ fees) of Debtor, Debtor shall take all actions and execute and deliver any and all instruments, agreements, assignments, certificates and/or documents reasonably required by Secured Party to collaterally assign any and all of Debtor’s material patent, copyright and trademark registrations and applications now owned or hereafter acquired to and in favor of Secured Party.

 

6.             Authorized Action by Secured Party.  Commencing upon and following the occurrence of the Effective date, Debtor hereby irrevocably appoints Secured Party as its attorney-in-fact (which appointment is coupled with an interest) and agrees that Secured Party may perform solely during the existence of an Event of Default (but Secured Party shall not be obligated to and shall incur no liability to Debtor or any third party for failure so to do) any act which Debtor is obligated by this Agreement to perform, and, solely during the existence of an Event of Default, to exercise such rights and powers as Debtor might exercise with respect to the Collateral, including the right to (a) collect by legal proceedings or otherwise and endorse, receive and receipt for all dividends, interest, payments, proceeds and other sums and property now or hereafter payable on or on account of the Collateral; (b) enter into any

 

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extension, reorganization, deposit, merger, consolidation or other agreement pertaining to, or deposit, surrender, accept, hold or apply other property in exchange for the Collateral; (c) make any compromise or settlement, and take any action Secured Party deems advisable, with respect to the Collateral, including without limitation bringing a suit in Secured Party’s own name to enforce any Intellectual Property; (d) endorse Debtor’s name on all applications, documents, papers and instruments necessary or desirable for Secured Party in the use of any Intellectual Property; (e) grant or issue any exclusive or non-exclusive license under any Intellectual Property to any person or entity; (f) assign, pledge, sell, convey or otherwise transfer title in or dispose of any Intellectual Property to any person or entity; (g) cause the Commissioner of Patents and Trademarks, United States Patent and Trademark Office (or as appropriate, such equivalent agency in foreign countries) to issue any and all patents and related rights and applications to Secured Party as the assignee of Debtor’s entire interest therein; (h) file a copy of this Agreement with any governmental agency, body or authority, including without limitation the United States Patent and Trademark Office and, if applicable, the United States Copyright Office or Library of Congress, at the sole cost and expense of Debtor; (i) insure, process and preserve the Collateral; (j) pay any indebtedness of Debtor relating to the Collateral; (k) execute and file UCC financing statements and other documents, certificates, instruments and agreements with respect to the Collateral or as otherwise required or permitted hereunder; and (l) take any and all appropriate action and execute any and all documents and instruments that may be necessary or useful to accomplish the purposes of this Agreement. The powers conferred on Secured Party under this Section 6 are solely to protect its interests in the Collateral and shall not impose any duty upon it to exercise any such powers. Secured Party shall be accountable only for the amounts that it actually receives as a result of the exercise of such powers, and neither Secured Party nor any of its stockholders, directors, officers, managers, employees or agents shall be responsible to Debtor for any act or failure to act, except with respect to Secured Party’s own gross negligence or willful misconduct. Nothing in this Section 6 shall be deemed an authorization for Debtor to take any action that it is otherwise expressly prohibited from undertaking by way of other provision of this Agreement.

 

7.             Default and Remedies.

 

7.1.         Default. Following the occurrence of the Effective Date, Debtor shall be deemed in default under this Agreement upon the occurrence and continuation of an Event of Default.

 

7.2.         Remedies. Upon the occurrence and continuation of any such Event of Default following the occurrence of the Effective Date, Secured Party shall have the rights of a secured creditor under the UCC, all rights granted by this Agreement and by law, including, without limiting the foregoing, (a) the right to require Debtor to assemble the Collateral and make it available to Secured Party at a place to be designated by Secured Party, and (b) the right to take possession of the Collateral, and for that purpose Secured Party may enter upon premises on which the Collateral may be situated and remove the Collateral therefrom. Debtor hereby agrees that fifteen (15) days’ notice of a public sale of any Collateral or notice of the date after which a private sale of any Collateral may take place is reasonable. In addition, Debtor waives any and all rights that it may have to a judicial hearing in advance of the enforcement of any of Secured Party’s rights and remedies hereunder, including, without limitation, Secured Party’s right following an Event of Default to take immediate possession of Collateral and to exercise Secured Party’s rights and remedies with respect thereto. Secured Party may also have a receiver appointed to take charge of all or any portion of the Collateral and to exercise all rights of Secured Party under this Agreement. Secured Party may exercise any of its rights under this Section 7.2 without demand or notice of any kind. The remedies in this Agreement, including without limitation this Section 7.2, are in addition to, not in limitation of, any other right, power, privilege, or remedy, either in law, in equity, or otherwise, to which Secured Party may be entitled. No failure or delay on the part of Secured party in exercising any right, power, or remedy will operate as a waiver thereof, nor will any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right hereunder. All of Secured Party’s rights and remedies, whether evidenced by this Agreement or by any other agreement, instrument or document shall be cumulative and may be exercised singularly or concurrently.

 

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7.3.         Standards for Exercising Rights and Remedies. To the extent that applicable law imposes duties on Secured Party to exercise remedies in a commercially reasonable manner, Debtor acknowledges and agrees that it is not commercially unreasonable for Secured Party (a) to fail to incur expenses reasonably deemed significant by Secured Party to prepare Collateral for disposition, (b) to fail to obtain third party consents for access to Collateral to be disposed of, or to obtain or, if not required by other law, to fail to obtain governmental or third party consents for the collection or disposition of Collateral to be collected or disposed of, (c) to fail to exercise collection remedies against account debtors or other persons obligated on Collateral or to fail to remove liens or encumbrances on or any adverse claims against Collateral, (d) to exercise collection remedies against account debtors and other persons obligated on Collateral directly or through the use of collection agencies and other collection specialists, (e) to advertise dispositions of Collateral through publications or media of general circulation, whether or not the Collateral is of a specialized nature, (f) to contact other persons, whether or not in the same business as Debtor, for expressions of interest in acquiring all or any portion of the Collateral, (g) to hire one or more professional auctioneers to assist in the disposition of Collateral, whether or not the Collateral is of a specialized nature, (h) to dispose of Collateral by utilizing Internet sites that provide for the auction of assets of the types included in the Collateral or that have the reasonable capability of doing so, or that match buyers and sellers of assets, (i) to dispose of assets in wholesale rather than retail markets, (j) to disclaim disposition warranties, (k) to purchase insurance or credit enhancements to insure Secured Party against risks of loss, collection or disposition of Collateral or to provide to Secured Party a guaranteed return from the collection or disposition of Collateral, or (l) to the extent deemed appropriate by Secured Party, to obtain the services of other brokers, investment bankers, consultants and other professionals to assist Secured Party in the collection or disposition of any of the Collateral. Debtor acknowledges that the purpose of this Section is to provide non-exhaustive indications of what actions or omissions by Secured Party would fulfill Secured Party’s duties under the UCC in Secured Party’s exercise of remedies against the Collateral and that other actions or omissions by Secured Party shall not be deemed to fail to fulfill such duties solely on account of not being indicated in this Section. Without limitation upon the foregoing, nothing contained in this Section shall be construed to grant any rights to Debtor or to impose any duties on Secured Party that would not have been granted or imposed by this Agreement or by applicable law in the absence of this Section.

 

7.4.         Marshalling. Secured Party shall not be required to marshal any present or future Collateral for, or other assurances of payment of, the Obligations or to resort to such Collateral or other assurances of payment in any particular order, and all of its rights and remedies hereunder and in respect of such Collateral and other assurances of payment shall be cumulative and in addition to all other rights and remedies, however existing or arising. To the extent that it lawfully may, Debtor hereby agrees that it will not invoke any law relating to the marshalling of Collateral which might cause delay in or impede the enforcement of Secured Party’s rights and remedies under this Agreement or under any other instrument creating or evidencing any of the Obligations or under which any of the Obligations is outstanding or by which any of the Obligations is secured or payment thereof is otherwise assured, and, to the extent that it lawfully may, Debtor hereby irrevocably waives the benefits of all such laws.

 

7.5.         Application of Collateral Proceeds. Following the occurrence of the Effective Date, the proceeds and/or avails of the Collateral, or any part thereof, and the proceeds and the avails of any remedy hereunder (as well as any other amounts of any kind held by Secured Party at the time of, or received by Secured Party after, the occurrence of an Event of Default) shall be paid to and applied as follows:

 

(a)           First, to the payment of reasonable and documented out-of-pocket costs and expenses, including all amounts expended to preserve the value of the Collateral, of foreclosure or suit, if any, and of such sale and the exercise of any other rights or remedies, and of all proper fees, expenses, liability and advances, including reasonable legal expenses and attorneys’ fees, incurred or made hereunder by Secured Party;

 

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(b)           Second, to the payment to Secured Party of the amount then owing or unpaid on the Note (to be applied first to accrued interest and fees and second to outstanding principal) and all amounts owed under any of the other Transaction Documents or other documents included within the Obligations; and

 

(c)           Third, to the payment of the surplus, if any, to Debtor, its successors and assigns, or to whosoever may be lawfully entitled to receive the same.

 

In the absence of final payment and satisfaction in full of all of the Obligations (other than contingent and indemnification obligations), Debtor shall remain liable for any deficiency.

 

8.             Miscellaneous.

 

8.1.         Notices. Any notice required or permitted hereunder shall be given in the manner provided in the subsection titled “Notices” in the Purchase Agreement, the terms of which are incorporated herein by this reference.

 

8.2.         Non-waiver. No failure or delay on Secured Party’s part in exercising any right hereunder shall operate as a waiver thereof or of any other right nor shall any single or partial exercise of any such right preclude any other further exercise thereof or of any other right.

 

8.3.         Amendments and Waivers. This Agreement may not be amended or modified, nor may any of its terms be waived, except by written instruments signed by Debtor and Secured Party. Each waiver or consent under any provision hereof shall be effective only in the specific instances for the purpose for which given.

 

8.4.         Assignment. This Agreement shall be binding upon and inure to the benefit of Secured Party and Debtor and their respective successors and assigns; provided, however, that Debtor may not sell, assign or delegate rights and obligations hereunder without the prior written consent of Secured Party.

 

8.5.         Cumulative Rights, etc. The rights, powers and remedies of Secured Party under this Agreement shall be in addition to all rights, powers and remedies given to Secured Party by virtue of any applicable law, rule or regulation of any governmental authority, or the Note, all of which rights, powers, and remedies shall be cumulative and may be exercised successively or concurrently without impairing Secured Party’s rights hereunder. Debtor waives any right to require Secured Party to proceed against any person or entity or to exhaust any Collateral or to pursue any remedy in Secured Party’s power.

 

8.6.         Partial Invalidity. If any part of this Agreement is construed to be in violation of any law, such part shall be modified to achieve the objective of the parties to the fullest extent permitted and the balance of this Agreement shall remain in full force and effect.

 

8.7.         Expenses. Debtor shall pay on demand all reasonable and documented out-of-pocket fees and expenses incurred following the occurrence of the Effective Date, including reasonable and documented attorneys’ fees and expenses, incurred by Secured Party in connection with the custody, preservation or sale of, or other realization on, any of the Collateral or the enforcement or attempt to enforce any of the Obligations which are not performed as and when required by this Agreement.

 

8.8.         Entire Agreement. This Agreement, the Note, and the other Transaction Documents, taken together, constitute and contain the entire agreement of Debtor and Secured Party with respect to this particular matter and supersede any and all prior agreements, negotiations, correspondence,

 

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understandings and communications between the parties, whether written or oral, respecting the subject matter hereof.

 

8.9.         Governing Law; Venue. Except as otherwise specifically set forth herein, the parties expressly agree that this Agreement shall be governed solely by the laws of the State of Utah, without giving effect to the principles thereof regarding the conflict of laws; provided, however, that enforcement of Secured Party’s rights and remedies against the Collateral as provided herein will be subject to the UCC. The provisions set forth in the Purchase Agreement to determine the proper venue for any disputes are incorporated herein by this reference.

 

8.10.       Waiver of Jury Trial. EACH PARTY TO THIS AGREEMENT IRREVOCABLY WAIVES ANY AND ALL RIGHTS IT MAY HAVE TO DEMAND THAT ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN ANY WAY RELATED TO THIS AGREEMENT OR THE RELATIONSHIPS OF THE PARTIES HERETO BE TRIED BY JURY. THIS WAIVER EXTENDS TO ANY AND ALL RIGHTS TO DEMAND A TRIAL BY JURY ARISING UNDER COMMON LAW OR ANY APPLICABLE STATUTE, LAW, RULE OR REGULATION. FURTHER, EACH PARTY HERETO ACKNOWLEDGES THAT IT IS KNOWINGLY AND VOLUNTARILY WAIVING ITS RIGHT TO DEMAND TRIAL BY JURY.

 

8.11.       Purchase Agreement; Arbitration of Disputes. By executing this Agreement, each party agrees to be bound by the terms, conditions and general provisions of the Purchase Agreement and the other Transaction Documents, including without limitation the Arbitration Provisions (as defined in the Purchase Agreement) set forth as an exhibit to the Purchase Agreement.

 

8.12.       Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be an original and all of which together shall constitute one instrument. Any electronic copy of a party’s executed counterpart will be deemed to be an executed original.

 

8.13.       Further Assurances. Debtor shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as Secured Party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.

 

8.14.       Time of the Essence. Time is expressly made of the essence with respect to each and every provision of this Agreement.

 

[Remainder of page intentionally left blank; signature page follows]

 

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IN WITNESS WHEREOF, Secured Party and Debtor have caused this Agreement to be executed as of the day and year first above written.

 

	
 
    	
SECURED   PARTY:
    
	
 
    	
 
    
	
 
    	
CHICAGO   VENTURE PARTNERS, L.P.
    
	
 
    	
 
    
	
 
    	
By:
    	
Chicago   Venture Management, L.L.C.,
    
	
 
    	
 
    	
its   General Partner
    
	
 
    	
 
    
	
 
    	
 
    	
By:   CVM, Inc., its Manager
    
	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   John M. Fife
    
	
 
    	
 
    	
John   M. Fife, President
    
	
 
    	
 
    
	
 
    	
DEBTOR:
    
	
 
    	
 
    
	
 
    	
JAGUAR HEALTH, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Lisa Conte
    
	
 
    	
Name:
    	
Lisa Conte
    
	
 
    	
Title:
    	
President and CEO
    
						

 

[Signature Page to Security Agreement]

 

 

SCHEDULE A

TO SECURITY AGREEMENT

 

All right, title, interest, claims and demands of Debtor in and to all of Debtor’s assets owned as of the date hereof and/or acquired by Debtor at any time while the Obligations are still outstanding, including without limitation, the following property:

 

1.                                      All equity interests in all wholly- or partially-owned subsidiaries of Debtor.

 

2.                                      All customer accounts, insurance contracts, and clients underlying such insurance contracts.

 

3.                                      All goods and equipment now owned or hereafter acquired, including, without limitation, all laboratory equipment, computer equipment, office equipment, machinery, fixtures, vehicles, and any interest in any of the foregoing, and all attachments, accessories, accessions, replacements, substitutions, additions, and improvements to any of the foregoing, wherever located;

 

4.                                      All inventory now owned or hereafter acquired, including, without limitation, all merchandise, raw materials, parts, supplies, packing and shipping materials, work in process and finished products including such inventory as is temporarily out of Debtor’s custody or possession or in transit and including any returns upon any accounts or other proceeds, including insurance proceeds, resulting from the sale or disposition of any of the foregoing and any documents of title representing any of the above, and Debtor’s books relating to any of the foregoing;

 

5.                                      All accounts receivable, contract rights, general intangibles, healthcare insurance receivables, payment intangibles and commercial tort claims, now owned or hereafter acquired, including, without limitation, all patents, patent rights and patent applications (including without limitation, the inventions and improvements described and claimed therein, and (a) all reissues, divisions, continuations, renewals, extensions and continuations-in-part thereof, (b) all income, royalties, damages, proceeds and payments now and hereafter due or payable under or with respect thereto, including, without limitation, damages and payments for past or future infringements thereof, (c) the right to sue for past, present and future infringements thereof, and (d) all rights corresponding thereto throughout the world), trademarks and service marks (and applications and registrations therefor), inventions, discoveries, copyrights and mask works (and applications and registrations therefor), trade names, trade styles, software and computer programs including source code, trade secrets, methods, published and unpublished works of authorship, processes, know how, drawings, specifications, descriptions, and all memoranda, notes, and records with respect to any research and development, goodwill, license agreements, information, any and all other proprietary rights, franchise agreements, blueprints, drawings, purchase orders, customer lists, route lists, infringements, claims, computer programs, computer disks, computer tapes, literature, reports, catalogs, design rights, income tax refunds, payments of insurance and rights to payment of any kind and whether in tangible or intangible form or contained on magnetic media readable by machine together with all such magnetic media, and all rights corresponding to all of the foregoing throughout the world, now owned and existing or hereafter arising, created or acquired;

 

6.                                      All now existing and hereafter arising accounts, contract rights, royalties, license rights and all other forms of obligations owing to Debtor arising out of the sale or lease of goods, the licensing of technology or the rendering of services by Debtor (subject, in each case, to the contractual rights of third parties to require funds received by Debtor to be expended in a particular manner), whether or not earned by performance, and any and all credit insurance, guaranties, and other security therefor, as well as all merchandise returned to or reclaimed by Debtor and Debtor’s books relating to any of the foregoing;

 

 

7.                                      All accounts, documents, cash, deposit accounts, letters of credit, letter of credit rights, supporting obligations, certificates of deposit, instruments, chattel paper, electronic chattel paper, tangible chattel paper and investment property, including, without limitation, all securities, whether certificated or uncertificated, security entitlements, securities accounts, commodity contracts and commodity accounts, and all financial assets held in any securities account or otherwise, wherever located, now owned or hereafter acquired and Debtor’s books relating to the foregoing;

 

8.                                      All other assets, goods and personal property of Debtor, wherever located, whether tangible or intangible, and whether now owned or hereafter acquired; and

 

9.                                      Any and all claims, rights and interests in any of the above and all substitutions for, additions and accessions to and proceeds and products thereof, including, without limitation, insurance, condemnation, requisition or similar payments and the proceeds thereof.

 

Notwithstanding the foregoing, the Collateral does not include the following:

 

a.                                More than 65% of the presently existing and hereafter arising issued and outstanding shares of capital stock owned by Debtor of any foreign subsidiary, which shares entitle the holder thereof to vote for directors or any other matter;

 

b.                                Any lease, license, contract or agreement to which the Debtor is a party, and any of its rights or interest thereunder, if and for so long as the valid grant of a Lien therein to Secured Party is prohibited as a matter of law or under the terms of such lease, license, contract or other agreement (including where the violation of any such prohibition would result in the termination of the applicable lease, license, contract or other agreement), and such prohibition has not been or is not waived or the consent of the other party to such lease, license, contract or other agreement, has not been or is not otherwise obtained; provided, that the exclusions set forth in this subsection (b) shall in no way be construed (A) to apply if any described prohibition is unenforceable under applicable laws (including, without limitation, Sections 9-406, 9-407 or 9-408 of the UCC), (B) to apply after the cessation of any such prohibition, and upon the cessation of such prohibition, such property shall automatically become part of the Collateral, (C) so as to limit, impair or otherwise affect Secured Party’s Lien upon Debtor’s rights or interests in or to monies due or to become due under any described lease, license, contract or other agreement, or (D) to limit, impair or otherwise affect Secured Party’s Lien upon any of Borrower’s rights or interest in and to any proceeds from the sale, license, lease or other disposition of any such lease, license, contract or other agreement

 

c.                                 Any property, lease, license, general intangible, contract or agreement subject to Permitted Liens securing purchase money indebtedness to the extent that a grant or perfection of a Lien in favor of Secured Party on any such property is prohibited by or results in a breach or termination of, or constitutes a default under, the documentation governing such Liens or the obligations secured by such Liens, to the extent enforceable under applicable law (including, without limitation, Section 9406 of the UCC); or

 

d.                                Any deposit account exclusively used for payroll, payroll taxes and other employee wage and benefit payments to or for the benefit of Debtor’s employees.Exhibit 4.1

 

 

 

SAFE BULKERS, INC.

 

- and -

 

SAFE BULKERS MANAGEMENT LIMITED

 

AMENDED AND RESTATED MANAGEMENT AGREEMENT

 

 

    	 

    	

    

TABLE OF CONTENTS

 

	ARTICLE I INTERPRETATION	1
	 	 
	ARTICLE II APPOINTMENT	5
	 	 
	ARTICLE III THE PARENT’S GENERAL OBLIGATIONS	6
	 	 
	ARTICLE IV THE MANAGER’S GENERAL OBLIGATIONS	7
	 	 
	ARTICLE V ADMINISTRATIVE SERVICES	9
	 	 
	ARTICLE VI COMMERCIAL SERVICES	11
	 	 
	ARTICLE VII INSURANCE	12
	 	 
	ARTICLE VIII AVAILABILITY OF OFFICERS	12
	 	 
	ARTICLE IX MANAGEMENT FEES AND EXPENSES	13
	 	 
	ARTICLE X BUDGETS, CORPORATE PLANNING AND EXPENSES	15
	 	 
	ARTICLE XI LIABILITY AND INDEMNITY	17
	 	 
	ARTICLE XII RIGHTS OF THE MANAGER, RESTRICTIONS ON THE MANAGER’S AUTHORITY, AND NON-COMPETE PROVISIONS	18
	 	 
	ARTICLE XIII TERMINATION OF THIS AGREEMENT	20
	 	 
	ARTICLE XIV CHANGE IN CONTROL OF THE MANAGER AND RIGHT OF FIRST OFFER	22
	 	 
	ARTICLE XV NOTICES	23
	 	 
	ARTICLE XVI APPLICABLE LAW	24
	 	 
	ARTICLE XVII ARBITRATION	24
	 	 
	ARTICLE XVIII MISCELLANEOUS	25

 

	APPENDIX I	Form of Hajioannou Entities Restrictive Covenant Agreement
	APPENDIX II	Form of Polys Hajioannou Restrictive Covenant Agreement
	APPENDIX III	Form of Shipmanagement Agreement
	APPENDIX IV	Form of Supervision Agreement

    	 

    	

    

THIS AMENDED AND RESTATED MANAGEMENT AGREEMENT (this
“Agreement”) is made on the 2nd day of August, 2017 and amends and restates in its entirety that certain Management Agreement, dated May 29, 2015 (the “Effective Date”)

 

BY AND BETWEEN:

 

(1) SAFE BULKERS, INC., a company organized
and existing under the laws of the Republic of the Marshall Islands (the “Parent”); and

 

(2) SAFE BULKERS MANAGEMENT LIMITED, a company
organized and existing under the laws of the Republic of Cyprus (the “Manager”).

 

WHEREAS:

 

(A) The Parent directly or indirectly wholly
owns or will wholly own (i) the corporations identified on Schedule A hereto, as such Schedule A may be amended from time to time
(the “Shipowning Subsidiaries”), each of which owns or will own one or more Drybulk Vessels (as defined below)
(the “Vessels”) and (ii) the corporations identified on Schedule B hereto, as such Schedule B may be amended
from time to time (together with the Shipowning Subsidiaries, the “Subsidiaries”).

 

(B) The Manager has the benefit of expertise
in the technical and commercial management of Drybulk Vessels and administration of shipowning companies generally.

 

(C) The Parent and the Manager desire to
enter into and adopt this Agreement, pursuant to which the Manager shall represent the Group (as defined below) in its dealings
with third parties and provide either directly or through a Submanager (as defined below) technical, commercial, administrative
and certain other services to the Group as specified herein in connection with the management and administration of the business
of the Group, in each case, to the extent the Parent elects to have the Manager provide such services.

 

NOW, THEREFORE, THE PARTIES HEREBY AGREE:

 

ARTICLE I

 

INTERPRETATION

 

SECTION 1.1
In this Agreement, unless the context otherwise requires:

 

“Affirmative Response” shall have the meaning
set forth in Section 14.4(b).

 

“Affiliates” means, with
respect to any Person as at any particular date, any other Persons that directly or indirectly, through one or more intermediaries,
are Controlled by, Control or are under common Control with the Person in question, and “Affiliate” means any
one of them.

 

“Agreement” shall have
the meaning set forth in the preamble.

 

“Approved Budget” shall
have the meaning set forth in Section 10.3.

    	1

    	

    

“Board of Directors” means
the board of directors of the Parent as the same may be constituted from time to time.

 

“Business Days” means
a day (excluding Saturdays and Sundays) on which banks are open for business in Athens, Greece; Cyprus; and New York, New York.

 

“Change in Control of the Parent”
means the occurrence of any of the following events: (a) if any “person” or “group” (as such terms are
used in Sections 13(d) and 14(d) of the Exchange Act or any successor provisions to either of the foregoing), including any group
acting for the purpose of acquiring, holding, voting or disposing of securities within the meaning of Rule 13d-5(b)(1) under the
Exchange Act (other than one or more Hajioannou Entities) (collectively, an “Acquiring Person”), becomes the
“beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of 40% or more of the
total voting power of the outstanding voting securities of the Parent, and such percentage represents a higher percentage of such
voting power than the Hajioannou Entities, collectively; or (b) the approval by the shareholders of the Parent of a proposed merger,
consolidation, recapitalization or similar transaction, as a result of which any Acquiring Person becomes the “beneficial
owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of 40% or more of the total voting power
of the outstanding voting securities of the resulting entity following such transaction, and such percentage represents a higher
percentage of such voting power than the Hajioannou Entities, collectively; or (c) a change in directors after which a majority
of the members of the Board of Directors are not Continuing Directors (as defined below). For purposes of this definition, such
person or group shall be deemed to beneficially own any outstanding voting securities of a corporation held by any other corporation
(the “parent corporation”) so long as such person or group beneficially owns, directly or indirectly, in the aggregate
a majority of the total voting power of the outstanding voting securities of such parent corporation.

 

“Control” or “Controlled”
means, with respect to any Person, the right to elect or appoint, directly or indirectly, a majority of the directors of such Person
or a majority of the Persons who have the right, including any contractual right, to manage and direct the business, affairs and
operations of such Person, or the possession of the power to direct or cause the direction of the management and policies of a
Person, whether through ownership of voting securities, by contract, or otherwise.

 

“Consent of the Parent”
means the prior written consent of a majority of the Independent Directors of the Parent.

 

“Continuing Directors”
means, as of any date of determination, any member of the Board of Directors who (i) was a member of the Board of Directors immediately
after the Effective Date, or (ii) was nominated for election or elected to the Board of Directors with the approval of a majority
of the directors then still in office who were either directors immediately after the Effective Date or whose nomination or election
was previously so approved.

 

“Crew” shall have the
meaning set forth in clause 1 of each Shipmanagement Agreement.

    	2

    	

    

“Draft Budget” shall have
the meaning set forth in Section 10.1.

 

“Drybulk Vessel” means
any ocean-going vessel (including any Newbuild) that is intended to be used primarily to transport non-liquid cargoes of commodities
shipped in an unpackaged state.

 

“Drybulk Vessel Business”
means any business involved in the ownership or operation of Drybulk Vessels.

 

“Effective Date” shall
have the meaning set forth in the preamble.

 

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

 

“Executive Officers” means
the Chief Executive Officer, the President, the Chief Operating Officer and the Chief Financial Officer of the Parent, and/or such
other officers that may be agreed by the parties hereto after the date of this Agreement from time to time.

 

“First Offer Notice” shall
have the meaning set forth in Section 14.4(a).

 

“First Offer Period” shall
have the meaning set forth in Section 14.4(b).

 

“Force Majeure” shall have the meaning set forth in Section 11.1.

 

“Group” means, at any
time, the Parent and the Subsidiaries at such time taking into account the Schedule A and Schedule B in effect at such time and
“member of the Group” shall be construed accordingly.

 

“Hajioannou Entities”
means Polys Hajioannou, Vorini Holdings Inc. and Machairiotissa Holdings Inc. and any entity controlled by, or under common control
with, any such individual or entity or any trust established for the benefit thereof.

 

“Hajioannou Restrictive Covenant
Agreement” means the Second Amended and Restated Restrictive Covenant Agreement, dated as of August 2, 2017, among Polys
Hajioannou, Vorini Holdings Inc., Machairiotissa Holdings Inc. and the Parent.

 

“Independent Directors”
means those members of the Board of Directors that qualify as independent directors within the meaning of Rule 10A-3 promulgated
under the Exchange Act and the rules adopted thereunder and the listing criteria of the New York Stock Exchange.

 

“Initial Term” shall have
the meaning set forth in Section 13.1.

 

“Machairiotissa” means
Machairiotissa Holdings Inc., a company organized and existing under the laws of the Republic of the Marshall Islands.

 

“Management Fee” shall
have the meaning set forth in Section 9.1.

 

“Management Services”
shall have, in relation to a Vessel, the meaning set forth in clause 1 of the Shipmanagement Agreement applicable to such Vessel.

    	3

    	

    

“Manager” shall have the
meaning set forth in the preamble.

 

“Manager Substitution”
shall have the meaning set forth in Section 2.6.

 

“Manager Competitive Activities”
shall have the meaning set forth in Section 12.4(a).

 

“Manager Related Parties”
shall have the meaning set forth in Section 11.2.

 

“Manager Restricted Period”
shall have the meaning set forth in Section 12.4(a).

 

“Negative Response” shall have the meaning set forth in
Section 14.4(b).

 

“Newbuild” means a new
vessel to be or which has just been constructed, or is under construction, which a member of the Group has agreed to acquire pursuant
to a shipbuilding contract, memorandum of agreement or otherwise.

 

“Other Manager” means
Safety Management Overseas S.A., a company organized and existing under the laws of the Republic of Panama.

 

“Other Restrictive Covenant Agreement”
means the Second Amended and Restated Restrictive Covenant Agreement, dated August 2, 2017, between the Parent and Polys Hajioannou.

 

“Parent” shall have the
meaning set forth in the preamble.

 

“Person” means an individual,
corporation, limited liability company, partnership, joint venture, trust or trustee, unincorporated organization, association,
governmental authority or other entity.

 

“Proposed Change in Control of the
Manager” means:

 

	 	(a)	the approval by the board of directors of the Manager or the shareholders of the Manager of a proposed sale of all or substantially all of the assets or property of the Manager necessary for the performance of its services under this Agreement; or 
	 	 	 
	 	(b)	the approval of any transaction that would result in: 
	 	 	 

	 	(i)	the Hajioannou Entities beneficially owning, directly or indirectly, less than 60% of the outstanding voting securities or voting power of the Manager or Machairiotissa, respectively; or 
	 	 	 
	 	(ii)	the Hajioannou Entities together with all directors, officers and employees of the Manager beneficially owning, directly or indirectly, less than 80% of the outstanding voting securities or voting power of the Manager or Machairiotissa, respectively.

    	4

    	

    

For purposes of this definition, the term Hajioannou Entities
shall exclude reference to Machairiotissa.

 

“Questioned Items” shall
have the meaning set forth in Section 10.2.

 

“Services” shall have the meaning set forth in Section 2.3.

 

“Shipmanagement Agreement”
shall have the meaning set forth in Section 3.2.

 

“Shipowning Subsidiaries” shall have the meaning set forth
in the recitals.

 

“Submanager” shall have
the meaning set forth in Section 2.4.

 

“Subsequent Term” shall
have the meaning set forth in Section 13.1.

 

“Subsidiaries” shall have the meaning set forth in the recitals.

 

“Supervision Agreement”
shall have the meaning set forth in Section 3.3.

 

“Term” shall have the meaning set forth in Section 13.1.

 

“Vessels” shall have the
meaning set forth in the recitals.

 

SECTION 1.2
The headings of this Agreement are for ease of reference and do not limit or otherwise affect the meaning hereof.

 

SECTION 1.3
All the terms of this Agreement, whether so expressed or not, shall be binding upon the parties hereto and their respective
successors and assigns.

 

SECTION 1.4
In the event of any conflict between this Agreement, any Shipmanagement Agreement or any Supervision Agreement, the provisions
of this Agreement shall prevail.

 

SECTION 1.5
Unless otherwise specified, all references to money refer to the legal currency of the United States of America.

 

SECTION 1.6
Unless the context otherwise requires, words in the singular include the plural and vice versa.

 

ARTICLE II

 

APPOINTMENT

 

SECTION 2.1
To the extent the Parent elects to have the Manager provide such services, the Manager is hereby appointed by the Parent
as the administrative manager of the Group and the Manager hereby accepts any such appointment on the terms and conditions of this
Agreement.

    	5

    	

    

SECTION 2.2
To the extent the Parent elects to have the Manager provide such services, the Manager shall be appointed by (a) each Shipowning
Subsidiary pursuant to the provisions of Section 3.3 hereof as the technical and commercial manager of each such Shipowning Subsidiary’s
Vessel on the terms and conditions of the relevant Shipmanagement Agreement and this Agreement and (b) each member of the Group
acquiring a Newbuild, as the supervisor of the construction thereof on the terms and conditions of the relevant Supervision Agreement
and this Agreement.

 

SECTION 2.3
The Manager undertakes to use its best endeavors to provide:

 

(a) the
services specified in Articles V, VI, VII and VIII of this Agreement;

 

(b) the
services specified in each Supervision Agreement; and

 

(c) the
Management Services in respect of each Vessel specified in each Shipmanagement Agreement (the services to be provided under Sections
2.3(a), 2.3(b) and 2.3(c) collectively the “Services”).

 

SECTION 2.4
The Manager may upon notice to the Parent appoint any Person (a “Submanager”) at any time throughout
the duration of this Agreement to discharge any of the Manager’s duties under this Agreement, provided that if such
Person is not an Affiliate of the Manager, the Manager shall obtain the Consent of the Parent prior to such appointment (such Consent
of the Parent not to be unreasonably withheld or delayed).

 

SECTION 2.5
The Manager’s power to delegate performance of any provision of this Agreement hereunder is without prejudice to the
Manager’s liability to the Parent to perform this Agreement with the intention that the Manager shall remain responsible
to the Parent for the due and timely performance of all duties and responsibilities of the Manager hereunder PROVIDED HOWEVER that
to the extent that any Submanager has performed any such duty, the Manager shall not be under any obligation to perform again the
same duty.

 

SECTION 2.6
The Parent may elect at any time to replace the Manager with the Other Manager for services provided hereunder (any such
replacement, a “Manager Substitution”). Upon a Manager Substitution, Schedule A, B and/or C hereto (as the case
may be) shall automatically be amended to reflect such a Manager Substitution. The Manager shall reasonably cooperate with the
Parent and the Other Manager to facilitate the transfer of such services (including the transfer of any prepaid costs to the Other
Manager) without disruption to the business of the Group or the incurrence of any additional costs or expenses to the Group. A
Manager Substitution shall not result in an increase to, or duplication of, the aggregate management fees payable to the Manager
and the Other Manager.

 

ARTICLE III

 

THE PARENT’S GENERAL OBLIGATIONS

 

SECTION 3.1
The Parent shall notify the Manager as soon as possible of any purchase of any vessel (whether the same is a second-hand
vessel or a Newbuild), the delivery of any Newbuild from the relevant builder or intermediate seller to the relevant member of
the

    	6

    	

    

Group to take ownership of such Newbuild, the sale of any vessels,
Newbuilds or Subsidairies, the purchase or creation of any direct or indirect subsidiary of the Parent or the sale or divestiture
of any Subsidiary, in each case, with respect to vessels that the Parent has elected to be managed by the Manager, and shall promptly
amend Schedule A and Schedule B hereto, as applicable, to be reflective of any such development. Such amended Schedule A or Schedule
B shall be effective on any such day as mutually agreed by the Parent and the Manager, which date shall be no later than five Business
Days after delivery of such amended Schedule A and/or Schedule B to the Manager by the Parent.

 

SECTION 3.2
For each Vessel the Parent shall cause the Shipowning Subsidiary that owns such Vessel to enter with the Manager into a
contract substantially in the form attached hereto as Appendix III (each a “Shipmanagement Agreement” and, collectively,
the “Shipmanagement Agreements”), with such alterations and additions as are agreed by the Manager and such
Shipowning Subsidiary to be appropriate; provided that any alterations or additions which materially vary from such form shall
require the approval of the Board of Directors.

 

SECTION 3.3
To the extent the Parent elects to have the Manager provide such services, for each Newbuild the Parent shall, or shall
procure that the relevant member of the Group that owns or has agreed to acquire such Newbuild shall, enter with the Manager into
a contract substantially in the form attached hereto as Appendix IV (each a “Supervision Agreement” and, collectively,
the “Supervision Agreements”), with such alterations and additions as are agreed by the Manager and such member
of the Group to be appropriate, having regard to the terms and conditions of the particular shipbuilding contract, memorandum of
agreement or other agreement relating to the acquisition of the relevant Newbuild; provided that any alterations or additions
which materially vary from such form shall require the approval of the Board of Directors.

 

SECTION 3.4
The Parent shall pay, or shall cause another member of the Group to pay, all slims due to the Manager punctually in accordance
with the terms of this Agreement, any Shipmanagement Agreement and/or any Supervision Agreement.

 

SECTION 3.5
The Parent shall procure that each other member of the Group (a) performs its obligations under any Shipmanagement Agreement
or any Supervision Agreement to which it is a party and (b) does not take any action or omits to take any action the effect of
which is to cause the Parent or the Manager or any Submanager to be in breach of this Agreement, any Shipmanagement Agreement and/or
any Supervision Agreement.

 

ARTICLE IV

 

THE MANAGER’S GENERAL OBLIGATIONS

 

SECTION 4.1
In the exercise of its duties hereunder, the Manager shall act fully in accordance with the reasonable policies, guidelines
and instructions from time to time communicated to it in writing by any member of the Group, exercising skill and diligence to
carry out its duties under this Agreement according to sound technical and commercial shipmanagement standards.

    	7

    	

    

SECTION 4.2
The Manager shall act and do all and/or any of the following acts or things described in this Agreement and the relevant
Shipmanagement Agreement or, as the case may be, Supervision Agreement applicable to each Vessel in the name and/or on behalf of
the Parent and/or, as the context may require, the relevant Subsidiary.

 

SECTION 4.3
The Manager acknowledges that the services it will provide pursuant to the Shipmanagement Agreements and the Supervision
Agreements are not limited to the services described in such agreements and include those set forth in this Agreement.

 

SECTION 4.4
The Manager shall ensure that all material property of any member of the Group is clearly identified as such, held separately
from the property of the Manager and, where applicable, held in safe custody.

 

SECTION 4.5
The Manager shall ensure that adequate manpower is employed by it to perform its obligations under this Agreement, PROVIDED
HOWEVER, that the Manager, in the performance of its responsibilities under this Agreement, shall be entitled to have regard to
its overall responsibilities in relation to the management of its clients and in particular, without prejudice to the generality
of the foregoing, the Manager shall be entitled to allocate available resources and services in such manner as in the prevailing
circumstances the Manager considers to be fair and reasonable.

 

SECTION 4.6
Notwithstanding anything to the contrary contained in this Agreement, any Shipmanagement Agreement or any Supervision Agreement,
the Manager agrees that any and all decisions of a material nature relating to the Parent, any Subsidiary, or any Vessel shall
be reserved to the Parent, such decisions including, but not being limited to:

 

(a) the
purchase and/or sale of shares in any entity or other assets of a material nature;

 

(b) the
purchase or formation of subsidiaries;

 

(c) the
entry into guarantees or loans or other forms of financing and any and all financial undertakings and commitments connected therewith;

 

(d) the
entry into and/or termination or amendment of any contractual relationships between any member of the Group and a third party or
another member of the Group; and

 

(e) the
presentation, negotiation, settlement, prosecution or defense of any claim, demand or petition for an amount exceeding $100,000
or its equivalent.

 

SECTION 4.7
During the Term, the Manager shall promote the business of the Group in accordance with the directions of the authorized
representative of the respective member of the Group and shall at all times use its best efforts to conform to and comply with
the lawful and reasonable directions, regulations or recommendations made by such authorized representative, and in the absence
of any specific directions or recommendations as aforesaid and, subject to the terms and conditions of this Agreement, shall provide
general administrative and advisory services in connection with the management of the business of the Group.

    	8

    	

    

SECTION 4.8
The Manager, in the performance of its responsibilities under this Agreement, any Supervision Agreement or any Shipmanagement
Agreement, shall ensure that any purchases of products or services from any of its affiliates or any other related entity shall
be on terms no less favorable to the Manager than the market prices for products or services that the Manager could obtain on an
arm’s-length basis from unrelated third parties.

 

SECTION 4.9
During the term hereof, the Manager agrees that, except as provided in Section 12.4(b), it will provide the services in
this Agreement to the Group on an exclusive basis and, without receiving the Consent of the Parent, it will not provide any Services
or other services contemplated herein to any entity other than the Parent, as applicable, and each Subsidiary.

 

SECTION 4.10
If a Vessel and a Drybulk Vessel directly or indirectly owned or operated by any of the Hajioannou Entities (other than
through the Parent or to the extent that such Hajioannou Entity is no longer subject to a Restrictive Covenant Agreement) are both
available and meet the criteria for a charter being fixed by the Manager, then the Vessel shall receive such charter. For the avoidance
of doubt, this Section 4.10 shall apply only to Drybulk Vessels owned or operated, directly or indirectly, by any Hajioannou Entity
that is under the commercial management of the Manager, and shall not apply to any Drybulk Vessel owned or operated, directly or
indirectly, by any Hajioannou Entity that is not under the commercial management of the Manager.

 

SECTION 4.11
The Manager shall at all times maintain and keep true and correct accounts as regards the Services and shall make the same
available for inspection and auditing by the Parent at such times as may be mutually agreed by the Manager, on the one hand, and
the Parent, on the other hand.

 

ARTICLE V

 

ADMINISTRATIVE SERVICES

 

SECTION 5.1
To the extent the Parent elects to have the Manager provide such services, the Manager shall provide certain general administrative
services to the Group, including, but not limited to, the following:

 

(a) keeping
all books and records of things done and transactions performed on behalf of any member of the Group as it may require from time
to time, including, but not limited to, liaising with accountants, lawyers and other professional advisors;

 

(b) except
as otherwise contemplated herein, representing any member of the Group generally in its dealings and relations with third parties;

 

(c) maintaining
the general ledgers of the Group, reconciliation of the Group’s bank accounts, preparation of periodic financial statements,
including, but not limited to, those required for governmental and regulatory or self-regulatory agency filings and reports to
shareholders, arranging for the audit of any such financial statements and the provision of related data processing services;

    	9

    	

    

(d) providing
assistance in the preparation of periodic and other reports, proxy statements, registration statements and other documents and
reports required by applicable law or the rules of any securities exchange or inter-dealer quotation system on which the securities
of the Parent or any member of the Group may be listed or quoted;

 

(e) preparing
and providing all tax returns required by any law or regulatory authority and developing, maintaining and monitoring internal audit
controls, disclosure controls and information technology for the Group;

 

(f) appointing
lawyers, at the Parent’s cost, for providing all legal services to ensure that each member of the Group is in compliance
with all applicable laws, including all relevant securities laws, and owns or possesses all licenses, patents, copyrights and trademarks
which are necessary and used in the operation of its business;

 

(g) appointing
lawyers, at the Parent’s cost, for providing for the presentation, negotiation, settlement, prosecution or defense of any
claim, demand or petition on behalf of any member of the Group arising in connection with the business of any member of the Group
for an amount not exceeding $100,000 or its equivalent, including the pursuit by any member of the Group of any rights of indemnification
or reimbursement;

 

(h) providing
advice to the Group with respect to financing, including entering into negotiations with banks or other financial institutions
for the purpose of arranging financing for the Parent and its Subsidiaries and the monitoring and administration of compliance
with any applicable financing terms and conditions in effect with investors, banks or other financial institutions;

 

(i) assisting
with arranging board meetings, director accommodation and travel for board meetings and preparing meeting materials and detailed
papers and agendas for scheduled meetings of the Board of Directors or the board of directors of any other member of the Group
(and any and all committees thereof) that, where applicable, contain such information as is reasonably available to the Manager
to enable the Board of Directors or such other board of directors (and any such committees) to base their opinion;

 

(j) preparing
or causing to be prepared reports to be considered by the Board of Directors (or any applicable committee thereof) in accordance
with the Parent’s internal policies and procedures on any acquisition, investment or sale of any part of the business;

 

(k) providing
or arranging for all services necessary to the engagement, employment and compensation of all employees, officers, consultants
and directors of any member of the Group, including, without limitation, (i) administering payroll services, benefits and director’s
or consultant’s fees, (ii) establishing and maintaining procedures and systems to comply with tax, labor and employment and
worker’s compensation laws, rules and regulations applicable to any member of the Group and (iii) administering compensation
and benefit programs of any member of the Group;

 

(l) at
the request of the Parent, negotiating and arranging for cash management services, financing and hedging arrangements relating
to interest rates, currency exchange rates and commodity prices;

    	10

    	

    

(m) handling
general and administrative expenses of the Parent, which are related to its operation as public company and, upon being provided
by the Parent with funds in accordance with the terms of Article X of this Agreement, arranging for the payment of the same;

 

(n) appointing
lawyers, at the Parent’s cost, for handling all administrative and clerical matters in respect of (i) the calling and arrangement
of all annual and/or special meetings of shareholders of the Parent, (ii) the preparation of all materials (including notices of
meetings and information circulars) in respect thereof and (iii) the submission of all such materials to the Parent in sufficient
time prior to the dates upon which they must be mailed, filed or otherwise relied upon so that the Parent has full opportunity
to review, approve, execute and return them to the Manager for filing or mailing or other disposition as the Parent may require
or direct;

 

(o) providing,
at the request and under the direction of the Parent, such communications to the transfer agent for the Parent as may be necessary
or desirable; and

 

(p) providing
any such other administrative services as the Parent, the authorized Executive Officers or any other representative of the Parent
may request and the Manager may agree to provide from time to time.

 

ARTICLE VI

 

COMMERCIAL SERVICES

 

SECTION 6.1
To the extent the Parent elects to have the Manager provide such services, the Manager shall provide the following commercial
services to the Group:

 

(a) performing
class records review and physical inspections in connection with any vessel to be purchased by a member of the Group;

 

(b) at
the request and under the direction of the Parent, providing administrative services in connection with the purchase of a second-hand
vessel or the acquisition or sale of a Newbuild, in either case by any member of the Group, including, if specifically instructed
by the Parent in writing, signing any agreed form of memorandum of agreement, shipbuilding contract or other similar contract for
and on behalf of the relevant member of the Group; and

 

(c) at
the request of the Parent, providing certain services in connection with a member of the Group taking physical delivery of a Vessel
or registering a Vessel or deleting a Vessel from the applicable port of registry on behalf of the relevant member of the Group.

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ARTICLE VII

 

INSURANCE

 

SECTION 7.1
To the extent the Parent elects to have the Manager provide such services, in addition to any duties of the Manager to insure
the Vessels as provided in clause 3.4 of each Shipmanagement Agreement, the Manager shall:

 

(a) arrange
either directly or, through insurance brokers appointed by the Manager, to effect Director’s & Officers Liability insurance
for the Board of Directors and Executive Officers with such insurance companies, at such rates and otherwise on such other terms
as the Parent shall have instructed and/or agreed upon;

 

(b) on
request, provide the Parent with a copy of any insurance claims and any reports prepared by the relevant insurers; and

 

(c) subject
to having been provided with funds by the Parent in accordance with Article X ensure that all premiums on the Parent’s D&O
insurance are paid in a timely fashion.

 

ARTICLE VIII

 

AVAILABILITY OF OFFICERS

 

SECTION 8.1
The Manager shall provide the Group with the services of those Executive Officers from time to time agreed with the Parent.
To the extent Executive Officers are so provided by the Manager, the remuneration for such Executive Officers shall be reflected
in the Management Fee and paid by the Manager. To the extent Executive Officers are not provided by the Manager but are instead
employed by the Parent, the Management Fee payable hereunder shall be reduced, in arrears, by an amount equal to the aggregate
costs of compensation and benefits and other incidental costs borne by the Parent as a result of such employment; provided that
such reduction shall be no greater than an amount to be agreed on an annual basis as part of the annual budgeting process contemplated
by Article X hereof; provided further, that, to avoid duplication, the Management Fee shall not be so reduced to the extent
the management fees payable to the Other Manager have been reduced with respect to the foregoing costs of compensation, benefits
and other incidental costs of the employment of the Executive Officers.

 

SECTION 8.2
The Executive Officers are entitled to direct the Manager to remove and replace any individual made available to any member
of the Group by the Manager serving as an officer or any senior manager serving as head of a business unit, in either case, of
that member of the Group other than any Executive Officer, from such position. The Board of Directors, in its sole discretion,
shall be entitled to direct the Manager to remove any individual made available to the Parent by the Manager serving as an Executive
Officer from such position and to appoint such other individual to serve as successor as the Board of Directors shall approve.
Furthermore, the Manager agrees that it will not remove any individual made available to any member of the Group by the Manager
serving as an officer or senior manager of that

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member of the Group from his or her position without the consent
of the Executive Officers and, in the case of any Executive Officer, the Board of Directors. If any officer or senior manager who
is made available to the Parent by the Manager resigns, is terminated or otherwise vacates his or her office, the Manager shall,
as soon as practicable after acceptance of any resignation or after termination, use reasonable best efforts to identify suitable
candidates for replacement of such officer.

 

SECTION 8.3
The Parent may employ directly, at its sole cost, any other officers, senior managers or employees as it may deem necessary,
and such individuals will not be subject to this Agreement.

 

SECTION 8.4
The Manager will report to the Parent and the Board of Directors through any one of more of the Executive Officers who are
made available to the Parent by the Manager or by the Chief Executive Officer of the Manager.

 

ARTICLE IX

 

MANAGEMENT FEES AND EXPENSES

 

SECTION 9.1
In consideration of the Manager providing the Services to the Group, during the Initial Term, the Parent shall pay the Manager
the following fees (together, the “Management Fees” and, on a per Vessel basis, the “Management Fee”):

 

(a) Subject
to paragraph (b) below, a fee of $975 per day per Vessel, payable monthly in arrears (pro rated to reflect the number of days that
the Parent (or any Subsidiary) owns or charters-in each Vessel during the applicable month);

 

(b) a
fee of $250 per day per Vessel chartered--out to a third party on a bareboat charter basis payable monthly in arrears (pro rated
to reflect the number of days that the Parent (or any Subsidiary) owns each such Vessel during the applicable month);

 

(c) a
fee equal to 0.0% calculated on the aggregate of the gross freight, demurrage, charter hire and ballast bonus obtained for the
employment of each Vessel during the Term, payable to the Manager monthly in arrears, but only to the extent such freight, demurrage,
charter hire or ballast bonus, as the case may be, is recognized as revenue;

 

(d) a
commission equal to 1% calculated on the price set forth in the memorandum of agreement or other sale and purchase contract of
(i) the Newbuilds set forth on Schedule C hereto, payable upon delivery of the Newbuilds to the relevant member of the Group; and
(ii) any other Vessel bought or sold by the Parent or any Subsidiary, payable upon final delivery of such vessel to the relevant
member of the Group or the relevant purchaser, as applicable; and

 

(e) a
fee of $550,000 per Newbuild for the services rendered by the Manager under the Supervision Agreement in respect of such Newbuild,
payable in accordance with the terms of such Supervision Agreement.

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The Management Fee payable hereunder shall be reduced in the
manner provided by Section 8.1 hereof.

 

SECTION 9.2
The Manager shall have the right to demand the Management Fee payable in relation to each Vessel from either the Parent
or the relevant member of the Group owning such Vessel under the terms of the relevant Shipmanagement Agreement or Supervision
Agreement, as applicable.

 

SECTION 9.3
In the event that a Shipmanagement Agreement is terminated, other than by reason of default by the Manager or in connection
with a Manager Substitution, the Management Fee payable to the Manager under Section 9.1(a) or, as the case may be, Section 9.1(b)
for the Vessel subject to such Shipmanagement Agreement shall be payable in respect of such Vessel for a further period of three
calendar months from the termination date. In addition (except in the case of a Manager Substitution):

 

(a) The
relevant member of the Group shall continue to pay Crew Support Costs (as such term is defined in the relevant Shipmanagement Agreement)
for the relevant Vessel during the said further period of three calendar months; and

 

(b) the
relevant member of the Group shall pay any Severance Costs (as such term is defined in the relevant Shipmanagement Agreement) for
the relevant Vessel which may materialize.

 

All amounts payable to the Manager under
this Section 9.3 shall be paid promptly by the Parent to the Manager following receipt by the Parent of a final accounting of funds
due from the Parent or any other member of the Group in accordance with Section 13.6.

 

SECTION 9.4

 

(a) The
Management Fee for each Vessel will be fixed throughout the Initial Term and shall not be subject to adjustment for euro/U.S. dollar
exchange rate fluctuations or inflation during such period.

 

(b) For
each Subsequent Term (as defined below), the Management Fee for each Vessel will be set at a mutually agreed-upon rate between
the Parent and the Manager no later than 30 days prior to the commencement of the relevant Subsequent Term.

 

(c) If
the Parent and the Manager are unable to agree on the Management Fee for any Subsequent Term pursuant to Section 9.4(b) hereof,
the Management Fee for such Subsequent Term will be determined by arbitration pursuant to the terms of Article XVII hereof.

 

SECTION 9.5
The Manager shall, at no additional cost to any member of the Group, provide the Group with office accommodation, office
staff (including secretarial, accounting and administrative assistance), facilities and stationery, and shall, subject to Section
9.6 and Section 10.8, pay for all printing, postage, domestic telephone and all other usual office expenses incurred by it as the
Manager (it being understood that the services of the Executive Officers shall be provided pursuant to Section 8.1).

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SECTION 9.6
The Parent hereby acknowledges that no capital expenditures, financial costs, operating expenses for each Vessel or general
and administrative expenses of the Group are covered by the Management Fees and any such costs, expenditure and expenses shall
be paid fully by the Parent or, as the case may be, the applicable member of the Group, whether directly to third parties or by
payment to such third parties through the Manager and, without prejudice to Section 10.8, to the extent incurred by the Manager,
shall be reimbursed to it by the Parent and/or any member of the Group from which the Manager, in its discretion, seeks reimbursement.
Such capital expenditures, financial costs, operating expenses for each Vessel and general and administrative expenses of the Group
include, without limiting the generality of the foregoing, items such as:

 

(a) fees,
interest, principal and any other costs due to the Group’s financiers and their respective advisors;

 

(b) all
voyage expenses and vessel operating expenses directly relating to the operation and management of the Vessels (including Crew
costs, surveyor’s attendance fees, bunkers, lubricant oils, spares, survey fees, classification society fees, maintenance
and repair costs, vetting expenses, etc.);

 

(c) any
commissions, fees, remuneration or disbursements due to lawyers, brokers, agents, surveyors, consultants, financial advisors, investment
bankers, insurance advisors or any other third parties whatsoever appointed by the Manager whether in its own name or on behalf
and/or in the name of any member of the Group;

 

(d) any
commissions, fees, remuneration or disbursements due to lawyers, brokers, agents, surveyors, consultants, financial advisors, investment
bankers, insurance advisors or any other third parties whatsoever sub-contracted to the Manager in the normal and reasonable course
of meeting the Manager’s duties and obligations under this Agreement including, without limiting the generality of the foregoing,
the duties provided in Articles V, VI and VII of this Agreement;

 

(e) deductibles,
insurance premiums (including D&O insurance) and/or P&I calls; and

 

(f) postage,
communication, traveling, victualing and other out-of-pocket expenses of the Manager and/or its personnel, incurred in providing
the Services, save for any such expenses incurred by the Manager under a Supervision Agreement.

 

ARTICLE X

 

BUDGETS, CORPORATE PLANNING AND EXPENSES

 

SECTION 10.1
On or before October 20 of each calendar year, the Manager shall prepare and submit to the Executive Officers and Board
of Directors a detailed draft budget for the next calendar year in a format acceptable to the Executive Officers and Board of Directors
and generally used by the Manager which shall include a statement of estimated revenue, estimated general and administrative expenses
of the Group, to the extent the Parent has elected for the Manager to provide such services to the Group, and a proposed budget
for capital

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expenditures, repairs or alterations, including proposed expenditures
in respect of dry-docking, together with an analysis as to when and why such replacements, improvements, renovations or expenditures
may be required (collectively, the “Draft Budget”).

 

SECTION 10.2
For a period of 15 days after receipt of the Draft Budget, the Executive Officers or Board of Directors from time to time,
may request further details and submit written comments on the Draft Budget. If the Executive Officers or Board of Directors do
not agree with any item of the Draft Budget, they will, within the same 15-day period, give the Manager notice of any inquiries
to the Draft Budget, which notice will include the list of items under consideration (the “Questioned Items”)
and a proposal for the resolution of each such Questioned Item. The Executive Officers, the Board of Directors and the Manager
will endeavor to resolve any such differences between them with respect to the Questioned Items, and any such differences that
are not resolved within 15 days after notice of such difference being given to the Manager will be settled by arbitration pursuant
to the terms of Article XVII hereof. If the Executive Officers or Board of Directors do not present any Questioned Items within
such 15-day period, they will be deemed to have accepted the Draft Budget and such Draft Budget shall be deemed to be the Approved
Budget (as defined in Section 10.3 below).

 

SECTION 10.3
By November 20 of the relevant calendar year the Manager will prepare and deliver to the Parent a revised budget that has
been approved by the Board of Directors, in consultation with the Executive Officers (the “Approved Budget”).

 

SECTION 10.4
The Manager may, from time to time, in any calendar year propose amendments to the Approved Budget upon 15 days’ notice
to the Parent, in which event the Executive Officers (or, in the case of a change of 7.5% or more, the Board of Directors) will
have the right to approve the amendments in accordance with the process set out in Section 10.2 with the relevant time periods
being amended accordingly and provided that any Questioned Items are resolved within 45 days of receipt of the notice by the Parent.

 

SECTION 10.5
Once the Approved Budget has been delivered, the Manager shall prepare and present to the Parent its estimate of the working
capital requirements of the Vessels and the Group and the Manager shall each month update this estimate. Based on such estimate,
the Manager shall each month make a request to the Parent and/or, as the case may be, the relevant members of the Group, in writing
for the funds required to provide the Services to the Group and to operate each Vessel for the ensuing month, including the payment
of any occasional or extraordinary item of expenditure, such as emergency repair costs, additional insurance premiums, bunkers
or provisions. Such funds shall be received by the Manager within ten calendar days after the receipt by the Parent or, as the
case may be, the relevant member of the Group of the Manager’s written request and shall be held to the credit of the Parent
or, in the Manager’s discretion, the relevant member of the Group in a separate bank account. At the end of each quarter
or, if the Manager from time to time so requires, at the end of each month, the Manager shall preliminarily reconcile the amounts
advanced to it by the Parent or, as the case may be, the relevant member of the Group with the amounts actually expended by it
for the operation of each of the Vessels, and (a) the Manager shall remit to the Parent, or credit to the Parent amounts to be
advanced to it hereunder for future months, any unused portion of the amounts previously advanced by the Parent or, as the case
may be, any member of the Group, or (b) the Parent shall pay to the Manager any amounts properly expended by the Manager in

    	16

    	

    

excess of the amounts previously advanced by the Parent or,
as the case may be, any member of the Group. The Parent and the Manager shall reconcile any amounts due to the Parent by the Manager
or due to the Manager by the Parent for each fiscal year of the Parent as promptly as practicable following the close of each such
fiscal year. Without prejudice to Section 10.8, any expenses incurred by the Manager under the terms of this Agreement on behalf
of any member of the Group may be debited against the account of the respective member of the Group, but shall in any event remain
payable by the Parent and the relevant member of the Group to the Manager on demand.

 

SECTION 10.6
The Manager shall produce a monthly comparison between budgeted and actual expenditures to the Executive Officers. The Manager
shall also maintain the records of all costs and expenses incurred, including any invoices, receipts and supplementary materials
as are necessary or proper for the settlement of accounts.

 

SECTION 10.7
Insofar as any moneys are collected by the Manager under the terms of this Agreement, any Shipmanagement Agreement and/or
any Supervision Agreement (other than moneys payable by a member of the Group to the Manager), such moneys and any interest thereon
shall be held to the credit of the relevant member of the Group in a separate bank account in the name thereof, but operated by
the Manager and the Parent jointly. Interest on any such bank account shall be for the benefit of the relevant member of the Group.

 

SECTION 10.8
Notwithstanding anything contained herein to the contrary, the Manager shall in no circumstances be required to use or commit
its own funds to finance the provision of the Services, other than (i) as contemplated by Section 8.1 hereof or (ii) with respect
to the employees employed by the Manager in the ordinary course of business.

 

ARTICLE XI

 

LIABILITY AND INDEMNITY

 

SECTION 11.1
Save for the obligation of the Parent to pay any moneys due to the Manager hereunder, neither any member of the Group nor
the Manager shall be under any liability to the other for any failure to perform any of their obligations hereunder by reason of
Force Majeure. “Force Majeure” shall mean any cause whatsoever of any nature or kind beyond the reasonable control
of the relevant member of the Group or the Manager, including, without limitation, acts of God, acts of civil or military authorities,
acts of war or public enemy, acts of any court, regulatory agency or administrative body having jurisdiction, insurrections, riots,
strikes or other labor disturbances, embargoes or other causes of a similar nature.

 

SECTION 11.2
The Manager, including its officers, directors, employees, shareholders, agents, sub-contractors and any Submanager (the
“Manager Related Parties”), shall be under no liability whatsoever to any member of the Group or to any third
party (including the Crew) for any loss, damage, delay or expense of whatsoever nature, whether direct or indirect (including but
not limited to loss of profit arising out of or in connection with detention of or delay to a Vessel), and howsoever arising in
the course of the performance of this Agreement, any Shipmanagement Agreement or any Supervision Agreement, unless and to the extent
that the

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same is proved to have resulted solely from the gross negligence
or willful misconduct of the Manager, its officers, employees, agents, sub-contractors or any Submanager.

 

SECTION 11.3
The Parent shall indemnify and hold harmless the Manager Related Parties against all actions, proceedings, claims, demands
or liabilities whatsoever or howsoever arising which may be brought against them or incurred or suffered by them arising out of
or in connection with the performance of this Agreement, any Shipmanagement Agreement or any Supervision Agreement and against
and in respect of any loss, damage, delay or expense of whatsoever nature (including legal costs and expenses on a full indemnity
basis), whether direct or indirect, incurred or suffered by any Manager Related Party arising out of or in connection with the
performance of this Agreement, any Shipmanagement Agreement and any Supervision Agreement, unless incurred or suffered due to the
gross negligence or willful misconduct of any Manager Related Party.

 

SECTION 11.4
It is hereby expressly agreed that no employee or agent of the Manager (including any sub-contractor from time to time employed
by the Manager) shall in any circumstances whatsoever be under any liability whatsoever to any member of the Group or any third
party for any loss, damage or delay of whatsoever kind arising or resulting directly or indirectly from any act, neglect or default
on his part while acting in the course of or in connection with his employment and, without prejudice to the generality of the
foregoing provisions in this Article XI, every exemption, limitation, condition and liberty herein contained and every right, exemption
from liability, defense and immunity of whatsoever nature applicable to the Manager or to which the Manager is entitled hereunder
shall also be available and shall extend to protect every such employee or agent of the Manager acting as aforesaid, and for the
purpose of all the foregoing provisions of this Article XI, the Manager is or shall be deemed to be acting as agent or trustee
on behalf of and for the benefit of all Persons who are or might be their servants or agents from time to time (including sub-contractors
as aforesaid) and all such Persons shall to this extent be or be deemed to be parties to this Agreement. Nothing in this Section
11.4 shall be construed so as to further limit any liability the Manager may have to the Group under Section 11.2 hereof.

 

SECTION 11.5
The provisions of this Article XI shell survive any termination of this Agreement.

 

ARTICLE
XII

 

RIGHTS OF THE MANAGER,
RESTRICTIONS ON THE MANAGER’S

AUTHORITY, AND NON-COMPETE PROVISIONS

 

SECTION 12.1
Except as may be provided in this Agreement or in any separate written agreement between the Parent or any other member
of the Group and the Manager, the Manager shall be an independent contractor and not the agent of the Parent or any other member
of the Group and shall have no right or authority to incur any obligation on behalf of any member of the Group or to bind any member
of the Group in any way whatsoever. Nothing in this Agreement shall be deemed to make the Manager or any of its subsidiaries or
employees an employee, joint venturer or partner of any member of the Group.

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SECTION 12.2
The Parent acknowledges that the Manager shall have no responsibility hereunder, direct or indirect, with regard to the
formulation of the business plans, policies, management or strategies (financial, tax, legal or otherwise) of any member of the
Group, which is solely the responsibility of each respective member of the Group. Each member of the Group shall set its corporate
policies independently through its respective board of directors and executive officers and nothing contained herein shall be construed
to relieve such directors or officers of each respective member of the Group from the performance of their duties or to limit the
exercise of their powers.

 

SECTION 12.3
Notwithstanding the other provisions of this Agreement:

 

(a) the
Manager may act with respect to a member of the Group upon any advice, resolutions, requests, instructions, recommendations, direction
or information obtained from such member of the Group or any banker, accountant, broker, lawyer or other Person acting as agent
of or adviser to such member of the Group and the Manager shall incur no liability to such member of the Group for anything done
or omitted or suffered in good faith in reliance upon such advice, instruction, resolution, recommendation, direction or information
made or given by such member of the Group or its agents, in the absence of gross negligence or willful misconduct by the Manager
or its servants, and shall not be responsible for any misconduct, mistake, oversight, error of judgment, neglect, default, omission,
forgetfulness or want of prudence on the part of any such banker, accountant, broker, lawyer, agent or adviser or other Person
as aforesaid;

 

(b) the
Manager shall not be under any obligation to carry out any request, resolution, instruction, direction or recommendation of any
member of the Group or its agents if the performance thereof is or would be illegal or unlawful; and

 

(c) the
Manager shall incur no liability to any member of the Group for doing or failing to do any act or thing which it shall be required
to do or perform or forebear from doing or performing by reason of any provision of any law or any regulation or resolution made
pursuant thereto or any decision, order or judgment of any court or any lawful request, announcement or similar action of any Person
or body exercising or purporting to exercise the legitimate authority of any government or of any central or local governmental
institution in each case where the above entity has jurisdiction.

 

SECTION 12.4

 

(a) During
the period commencing on the Effective Date and ending one year following termination of the Management Agreement (the “Manager
Restricted Period”), the Manager shall be prohibited from, directly or indirectly, providing management services to,
or with respect to, any Drybulk Vessels (such activities, the “Manager Competitive Activities”), other than
as set forth in Section 12.4(b).

 

(b) Subject
to Section 4.10, the Manager may engage in Manager Competitive Activities pursuant to its involvement with the Parent and with
respect to the following: (i) Drybulk Vessels that are owned or operated (which includes chartering—in activities) by one
or more of the Hajioannou Entities or a family member of Polys Hajioannou and (ii) Drybulk

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Vessel Businesses that are acquired, invested
in or controlled by one or more of the Hajioannou Entities or a family member of Polys Hajioannou, in the case of each of clauses
(i) and (ii), subject to compliance with, or waivers of, the Hajioannou Restrictive Covenant Agreement and the Other Restrictive
Covenant Agreement, as applicable.

 

ARTICLE XIII

 

TERMINATION OF THIS AGREEMENT

 

SECTION 13.1
This Agreement shall be effective as of the Effective Date and, subject to Sections 13.2, 13.3, 13.4 and 13.5, shall continue
until the date falling one year after the Effective Date (the “Initial Term”). Thereafter the term of this Agreement
shall be extended on a year-to-year basis up to two times (each a “Subsequent Term”) unless the Parent, at least
12 months prior to the end of the then current term, gives written notice to the Manager that it wishes to terminate this Agreement
at the end of the then current term. In no event will the term of this Agreement (the “Term”) extend beyond
the date falling 3 years after the Effective Date.

 

SECTION 13.2
The Parent shall be entitled to terminate this Agreement upon notice in writing to the Manager if:

 

(a) the
Manager defaults in the performance of any material obligation under this Agreement, subject to a cure right of 20 Business Days
following written notice by the Parent, provided that any default of the Manager to perform any of its obligations under a relevant
Shipmanagement Agreement or any Supervision Agreement shall not, in itself, entitle the Parent to terminate this Agreement pursuant
to this Section 13.2(a) and shall only allow the relevant member of the Group to terminate the relevant Shipmanagement Agreement
or Supervision Agreement; provided, further, that if a Submanager was performing services under a Shipmanagement Agreement that
was terminated pursuant to this Section 13.2(a) due to the default of that Submanager, the Parent shall be entitled to direct the
Manager to remove such Submanager with respect to any other Shipmanagement Agreement under which such Submanager is then performing
services;

 

(b) any
moneys due and payable to the Parent or third parties by the Manager under this Agreement is not paid or accounted for within 10
Business Days following written notice by the Parent; or

 

(c) at
any time after the Initial Term upon 12 months’ written notice by the Parent.

 

SECTION 13.3
The Manager shall be entitled to terminate this Agreement by notice in writing to the Parent if

 

(a) any
moneys payable by the Parent under this Agreement is not paid when due or if due on demand within 10 Business Days following demand
by the Manager;

 

(b) the
Parent defaults in the performance of any other material obligations under this Agreement, subject to a cure right of 20 Business
Days following written notice by the Manager;

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(c) there
is a Change in Control of the Parent; or

 

(d) the
Management Fee for any Subsequent Term is determined by arbitration pursuant to the terms of Article XVII hereof and the arbitrators
accept the Parent’s proposal, with such termination being effective at the end of that Subsequent Term.

 

SECTION 13.4
Either party shall be entitled to terminate this Agreement immediately if

 

(a) the
other party ceases to conduct business, or all or substantially all of the equity-interests, properties or assets of either such
party is sold, seized or appropriated;

 

(b) (i)
the other party files a petition under any bankruptcy law, makes an assignment for the benefit of its creditors, seeks relief under
any law for the protection of debtors or adopts a plan of liquidation; (ii) a petition is filed against the other party seeking
to have it declared insolvent or bankrupt and such petition is not dismissed or stayed within 40 Business Days of its filing; (iii)
the other party shall admit in writing its insolvency or its inability to pay its debts as they mature; (iv) an order is made for
the appointment of a liquidator, manager, receiver or trustee of the other party of all or a substantial part of its assets; (v)
or if an encumbrancer takes possession of or a receiver or trustee is appointed over the whole or any part of the other party’s
undertaking, property or assets; or (vi) if an order is made or a resolution is passed for the other party’s winding up;

 

(c) a
distress, execution, sequestration or other process is levied or enforced upon or sued out against a material amount of the other
party’s property which is not discharged within 20 Business Days;

 

(d) the
other party ceases or threatens to cease wholly or substantially to carry on its business otherwise than for the purpose of a reconstruction
or amalgamation without insolvency previously approved by the terminating party;

 

(e) the
other party is prevented from performing its obligations in any material respect hereunder by reasons of Force Majeure for a period
of two or more consecutive months; or

 

(f) All
Supervision Agreements and all Shipmanagement Agreements are terminated in accordance with the respective terms thereof.

 

SECTION 13.5
Upon the effective date of termination pursuant to this Article XIII, the Manager shall promptly terminate its service hereunder,
ensuring that such termination occurs in a manner that minimizes any interruption to the business of the members of the Group.

 

SECTION 13.6
Upon termination, the Manager shall, as promptly as possible, submit a final accounting of funds received and disbursed
under this Agreement, any Supervision Agreement and/or any. Shipmanagement Agreement and of any remaining Management Fees and/or
any other funds due from the Parent or any other member of the Group, calculated pro rata to the date of termination (except for
those amounts payable in respect of the three months following the termination date under Section 9.3, which shall be payable by
the Parent in

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accordance with that Section), and any non-disbursed funds of
any member of the Group in the Manager’s possession or control will be paid by the Manager as directed by such member of
the Group promptly upon the Manager’s receipt of all sums then due it under this Agreement, any Supervision Agreement and/or
any Management Agreement, if any.

 

SECTION 13.7
Upon termination of this Agreement, the Manager shall release to the Parent the originals where possible, or otherwise certified
copies, of all such accounts and all documents specifically relating to each Vessel or the provision of the Services.

 

SECTION 13.8
The provisions of this Article XIII shall survive any termination of this Agreement.

 

ARTICLE XIV

 

CHANGE IN CONTROL OF THE MANAGER AND RIGHT
OF FIRST OFFER

 

SECTION 14.1
During the Manager Restricted Period, the Manager is prohibited from transferring, assigning, selling or disposing of substantially
all or all of its assets or property that is necessary for the performance of its services under this Agreement, any Supervision
Agreement or any Shipmanagement Agreement to any other party without the Consent of the Parent except in the event that at the
same time as or within three months after such disposition takes place the Manager is set to replace the same with equivalent assets
or property.

 

SECTION 14.2
During the Manager Restricted Period, in the event of a Proposed Change in Control of the Manager, the Parent shall have
a right of first offer to purchase the Manager pursuant to the procedures set forth in Section 14.4.

 

SECTION 14.3
The Parent and the Manager acknowledge that all potential transfers pursuant to this Article XIV are subject to obtaining
any and all written consents of governmental authorities and other non-affiliated third parties.

 

SECTION 14.4
Set forth below are the procedures for the Parent’s right of first offer to purchase the Manager under Section 14.2:

 

(a) Prior
to engaging in any negotiations or otherwise offering to consummate a Proposed Change in Control of the Manager with any third
party, the Manager shall provide written notice of its intent to engage in a Proposed Change in Control of the Manager (a “First
Offer Notice”) and shall specify in such First Offer Notice the material terms and conditions (including the consideration
to be paid, which shall be in cash) on which it would be willing to consummate a Proposed Change in Control of the Manager with
the Parent, including any liabilities to be assumed by the Parent.

 

(b) The
Parent shall notify the Manager within 30 days after receiving a First Offer Notice (the “First Offer Period”)
that either (i) the Parent does not wish to participate in a Proposed Change in Control of the Manager (a “Negative Response”)
or (ii) the Parent does wish to participate in a Proposed Change in Control of the Manager, subject to the negotiation of the

    	22

    	

    

terms and conditions of the Proposed Change in Control of the
Manager in accordance with the provisions of this Article XIV (an “Affirmative Response”).

 

(c) In
the event of an Affirmative Response, the Parent and the Manager shall negotiate in good faith during the First Offer Period the
terms and conditions of an agreement for the consummation of a Proposed Change in Control of the Manager with the Parent and such
terms and conditions are to be based on the terms and conditions set forth in the First Offer Notice.

 

(d) In
the event of a Negative Response or in the event the Parent and the Manager are unable to agree on the terms and conditions of
an agreement for the consummation of a Proposed Change in Control of the Manager during the First Offer Period, then the Manager
may consummate a Proposed Change in Control of the Manager within 120 days after the earlier of the date the Manager receives a
Negative Response and the end of the First Offer Period with a third party on terms and conditions as to price that are not more
favorable, and on such other terms and conditions that are not materially more favorable, to the proposed purchaser than the terms
and conditions specified in the First Offer Notice.

 

(e) If
the Manager does not consummate a Proposed Change in Control of the Manager to a third party within 120 days after the earlier
of the date the Manager receives a Negative Response from the Parent and the end of the First Offer Period in accordance with Section
14.4(d) then the Manager shall not thereafter consummate a Proposed Change in Control of the Manager without first offering to
consummate a Proposed Change in Control of the Manager with the Parent in the manner provided above.

 

SECTION 14.5
Upon request of the Parent, the Manager shall promptly disclose to the Parent the respective ownership, both record and
beneficial, interests in the Manager of (a) the Hajioannou Entities, (b) directors, officers and employees of the Manager as a
group, and (e) any other persons who are record or beneficial owners of the Manager, together with the identities of such other
persons.

 

ARTICLE XV

 

NOTICES

 

SECTION 15.1
All notices, consents and other communications hereunder, or necessary to exercise any rights granted hereunder, shall be
in writing, sent either by prepaid registered mail or telefax, and will be validly given if delivered on a Business Day to an individual
at the following address:

 

If to the Parent:

 

Safe Bulkers, Inc.

Apt.D11 – Les Acanthes

6, Avenue des Citronniers

MC98000, Monaco

    	23

    	

    

Telefax: +357 25 887220

Attention: President

 

If to the Manager:

 

Safe Bulkers Management Limited

KPMG Building - Office G1B

Agias Filakseos 1

3025

Limassol, Cyprus

 

Attention: Director

 

ARTICLE XVI

 

APPLICABLE LAW

 

SECTION 16.1
This Agreement shall be governed by, and construed in accordance with, the laws of England.

 

SECTION 16.2
Except for Section 3.5 and Article XI which can be relied upon by a Submanager, no other 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.

 

ARTICLE XVII

 

ARBITRATION

 

SECTION 17.1
Any dispute arising out of or in connection with this Agreement shall be referred to arbitration in London in accordance
with the Arbitration Act 1996 or any statutory modification or re-enactment thereof save to the extent necessary to give effect
to the provisions of this Article XVII. The arbitration shall be conducted in accordance with the London Maritime Arbitrators Association
(LMAA) Terms current at the time when the arbitration proceedings are commenced.

 

SECTION 17.2
The reference shall be to three arbitrators. A party wishing to refer a dispute to arbitration shall appoint its arbitrator
and send notice of such appointment in writing to the other party requiring the other party to appoint its own arbitrator within
14 calendar days of that notice and stating that it will appoint its arbitrator as sole arbitrator unless the other party appoints
its own arbitrator and gives notice that it has done so within the 14 days specified. If the other party does not appoint its own
arbitrator and give notice that it has done so within the 14 days specified, the party referring a dispute to arbitration may,
without the requirement of any further prior notice to the other party, appoint its arbitrator as sole arbitrator and shall advise
the other party accordingly. The award of a sole arbitrator shall be binding on both parties as if he had been appointed by agreement.
Nothing herein shall prevent the parties agreeing in writing to vary these provisions to provide for the appointment of a sole
arbitrator.

    	24

    	

    

SECTION 17.3
In the case of (i) any failure of the parties to agree on the Management Fee for any Subsequent Term within 30 days prior
to the commencement of that Subsequent Term or (ii) any failure of the parties to agree upon the resolution of any Questioned Items
in a Draft Budget prior to the 20th of November of a calendar year, the terms of this Section 17.3 shall be applicable. Notwithstanding
any contrary provisions of this Article XVII (but otherwise subject to such provisions), the following “Baseball Arbitration”
provisions shall apply to the matters referred to in clauses (i) and (ii) above:

 

(a) Each
party shall designate one arbitrator within 5 business days following the relevant date specified in clause (i) or (ii) above;
and the two arbitrators so designated shall designate a third within 10 Business Days thereafter; provided, however,
that the parties may agree to a single arbitrator. If either party fails to designate an arbitrator within such 5 Business Day
period, the other arbitrator can render an award hereunder.

 

(b) Each
party shall propose an amount for each item in dispute that is subject to this Section 17.3, which shall be provided in writing
to the arbitrators, together with any supporting documentation. Such proposed amounts may differ from the amounts proposed by the
parties in their negotiations prior to triggering the implementation of this Section 17.3. The arbitrators may, but shall not be
required to, accept oral testimony in addition to supporting documentation.

 

(c) Within
20 Business Days following the selection of the arbitrators hereunder, they shall, by majority vote, accept the proposal of one
party or the other for each item that is the subject of arbitration pursuant to this Section 17.3.

 

(d) Awards
under this Section 17.3 shall not include costs, but may include interest if the payment date for any amount shall have passed.
The fees and expenses of the arbitrators under this Section 17.3 shall be borne by the losing party (and may be apportioned by
the arbitrators if more than one item is the subject of an arbitration).

 

(e) Awards
under this Section 17.3 shall be final and binding on the parties.

 

ARTICLE XVIII

 

MISCELLANEOUS

 

SECTION 18.1
This Agreement (which includes the Annex) constitutes the sole understanding and agreement of the parties hereto with respect
to the subject matter hereof and supersedes all prior agreements or understandings, written or oral, with respect thereto. This
Agreement may not be amended, waived or discharged except by an instrument in writing executed by the party against whom enforcement
of such amendment, waiver or discharge is sought.

 

SECTION 18.2
During the term hereof, the Manager will not provide services hereunder through, or otherwise cause any member of the Group
to have, an office or fixed place of business in the United States.

    	25

    	

    

SECTION 18.3
This Agreement may be executed in one or more written counterparts, each of which shall be deemed an original, but all of
which together shall constitute one instrument.

 

[Signature Page Follows]

    	26

    	

    

IN WITNESS WHEREOF the undersigned have executed
this Agreement as of the date first above written.

 

	 	SAFE BULKERS, INC.
	 	 	 
	 	By:	/s/ Loukas Barmparis
	 	Name:	Loukas Barmparis
	 	Title:	President
	 	 	 
	 	SAFE BULKERS MANAGEMENT LIMITED
	 	 	 
	 	By:	/s/ George Papadopoulos
	 	Name:	George Papadopoulos
	 	Title:	Director

 

[Signature Page to Amended and Restated
Management Agreement]

    	 

    	

    

APPENDIX I

 

Form of Hajioannou Entities Restrictive
Covenant Agreement

    	 

    	

    

 

 

SAFE BULKERS, INC.,

 

POLYS HAJIOANNOU,

 

VORINI
HOLDINGS INC.

 

- and -

 

MACHAIRIOTISSA HOLDINGS INC.

 

 

 

SECOND AMENDED AND RESTATED

RESTRICTIVE COVENANT AGREEMENT

 

 

 

 

    	 

    	

    

THIS SECOND AMENDED AND RESTATED
RESTRICTIVE COVENANT AGREEMENT (this “Agreement”) is made on July [n],
2017, and amends and restates in its entirety that certain Restrictive Covenant Agreement, dated May 29, 2008, as amended by
that certain Amendment No. 1 to Restrictive Covenant Agreement, dated December 7, 2011, and that certain Amendment No. 2 to
Restrictive Covenant Agreement, dated February 25, 2014, and as further amended and restated by that certain Amended and
Restated Restrictive Covenant Agreement, dated May 29, 2015 (collectively, the “Original Agreement”),

 

BY AND BETWEEN:

 

1. SAFE BULKERS, INC., a Marshall Islands
corporation (the “Company”);

 

2. POLYS HAJIOANNOU, in his individual capacity
(“P. Hajioannou”);

 

3. VORINI HOLDINGS INC., a Marshall Islands
corporation (“Vorini Holdings”); and

 

4. MACHAIRIOTISSA HOLDINGS INC., a Marshall
Islands corporation (“Machairiotissa Holdings” and, together with P. Hajioannou, Vorini Holdings and, together
with any entity controlled by or under common control with Machairiotissa Holdings, P. Hajioannou and/or Vorini Holdings, the “Hajioannou
Entities”).

 

WHEREAS:

 

1. Pursuant to Section 8.1 of
the Original Agreement, the parties thereto may amend the Original Agreement by an instrument in writing;

 

2. Pursuant to the Second Amended and Restated
Management Agreement by and between the Company and Safety Management Overseas S.A., a Panamanian corporation (the “SMO
Manager”), dated July [n], 2017 (the “SMO Management Agreement”),
and the Management Agreement by and between the Company and Safe Bulkers Management Limited, a Cypriot private limited company
(the “Safe Bulkers Manager,” together with the SMO Manager, the “Managers”), dated July [n],
2017 (the “Safe Bulkers Manager Management Agreement,” together with the SMO Management Agreement, the “Management
Agreements”), the Managers have agreed to provide certain management services to the Company on an exclusive basis, restrict
certain competitive activities and grant a right of first offer to the Company to purchase their respective assets and properties
upon the occurrence of certain events, all as described therein; and

 

3. The Company wishes to (i) limit the activities
of each of the Hajioannou Entities, on the terms and conditions set out in this Agreement in order to prohibit certain activities
that may compete with the business of the Company and (ii) be granted a right of first offer to purchase the Hajioannou Entities’
relevant interest in each of the Managers in the event of a potential change of control of each such Manager, respectively.

 

NOW, THEREFORE, in consideration of the terms
and conditions set forth below and other good and valuable consideration (the receipt and sufficiency of which is hereby acknowledged),
the parties hereto agree as follows:

 

USActive 37251603.8

    	 

    	

    

ARTICLE I

 

INTERPRETATION

 

SECTION 1.1
In this Agreement, unless the context otherwise requires:

 

(a) “Affirmative
Response” shall have the meaning set forth in Section 4.2(b).

 

(b) “Agreement”
shall have the meaning set forth in the preamble.

 

(c) “Applicable
Vessels” shall have the meaning set forth in Section 3.4.

 

(d) “Board
of Directors” means the board of directors of the Company as the same may be constituted from time to time.

 

(e) “Break
Up Cost” means the aggregate amount of any and all costs including any taxes, registration fees, administrative expenses,
severance costs, and other similar costs and expenses that would be required to transfer Drybulk Vessels or any other portion of
a Non-Drybulk Acquisition that owns or operates Drybulk Vessels to the Company separately from the other assets of the Non-Drybulk
Acquisition.

 

(f) “Business
Day” means a day (excluding Saturdays and Sundays) on which banks are open for business in Athens, Greece; Cyprus; and
New York, New York.

 

(g) “Company”
shall have the meaning set forth in the preamble.

 

(h) “Company
Group” means, at any time, the Company and its subsidiaries at such time and “member of the Company Group”
shall be construed accordingly.

 

(i) “Competitive
Activities” shall have the meaning set forth in Section 3.1.

 

(j) “Drybulk
Vessel” means any ocean-going vessel (including any Newbuild) that is intended to be used primarily to transport non-liquid
cargoes of commodities shipped in an unpackaged state.

 

(k) “Drybulk
Vessel Business” means any business involved in the ownership or operation of Drybulk Vessels.

 

(l) “Effective
Date” means May 28, 2008.

 

(m) “First
Offer Notice” shall have the meaning set forth in Section 4.2(a).

 

(n) “First
Offer Period” means 30 days in the case of a Manager First Offer Right.

 

(o) “Hajioannou
Entities” shall have the meaning set forth in the preamble.

    	2

    	

    

(p) “Independent
Directors” means those members of the Board of Directors that qualify as independent directors within the meaning of
Rule 10A-3 promulgated under the U.S. Securities Exchange Act of 1934, as amended, and the listing criteria of the New York Stock
Exchange.

 

(q) “Machairiottisa
Holdings” shall have the meaning set forth in the preamble.

 

(r) “Management
Agreements” shall have the meaning set forth in the recitals.

 

(s) “Managers”
shall have the meaning set forth in the recitals.

 

(t) “Manager
First Offer Right” shall have the meaning set forth in Section 4.1.

 

(u) “Negative
Response” shall have the meaning set forth in Section 4.2(b).

 

(v) “Newbuild”
means a new vessel to be or which has just been constructed, or is under construction, which a member of the Company Group has
agreed to acquire pursuant to a shipbuilding contract, memorandum of agreement or otherwise.

 

(w) “Non-Drybulk
Acquisition” means an acquisition or investment that includes (i) both Drybulk Vessels and vessels other than Drybulk
Vessels and/or (ii) any business that owns or operates Drybulk Vessels and vessels other than Drybulk Vessels.

 

(x) “P.
Hajioannou” shall have the meaning set forth in the preamble.

 

(y) “Permitted
Acquisition” means an acquisition by any of the Hajioannou Entities of a Drybulk Vessel or an acquisition of or investment
in a Drybulk Vessel Business that (i) has been first offered to the Company and refused by the majority of the Independent Directors
and (ii) has been acquired or invested in by the relevant Hajioannou Entity on terms and conditions as to price that are not more
favorable, and on such other terms and conditions that are not materially more favorable, to such Hajioannou Entity than those
offered to the Company.

 

(z) “Proposed
Change in Control of a Manager” means:

 

(a) the approval by the board of directors
of a Manager or the shareholders of a Manager of a proposed sale of all or substantially all of the assets or property of such
Manager necessary for the performance of its services under this Agreement; or

 

(b) the approval of any transaction that
would result in:

 

(i) the Hajioannou Entities beneficially owning, directly or indirectly, less than 60% of the outstanding voting
securities or voting power of a Manager or Machairiotissa Holdings, respectively; or

    	3

    	

    

(ii) the Hajioannou Entities together with
all directors, officers and employees of a Manager beneficially owning, directly or indirectly, less than 80% of the outstanding
voting securities or voting power of such Manager or Machairiotissa Holdings, respectively.

 

For purposes of this definition, the term Hajioannou Entities
shall exclude reference to Machairiotissa Holdings.

 

(aa) “Restricted
Period” shall have the meaning set forth in Section 3.1.

 

(bb) “Safe
Bulkers Manager Management Agreement” shall have the meaning set forth in the recitals.

 

(cc) “Safe
Bulkers Manager” shall have the meaning set forth in the recitals.

 

(dd) “SMO
Management Agreement” shall have the meaning set forth in the recitals.

 

(ee) “SMO
Manager” shall have the meaning set forth in the recitals.

 

(ff) “Sale
Transaction” shall have the meaning set forth in Section 4.2.

 

(gg) “Vorini
Holdings” shall have the meaning set forth in the preamble.

 

SECTION 1.2
The headings of this Agreement are for ease of reference and do not limit or otherwise affect the meaning hereof.

 

SECTION 1.3
All the terms of this Agreement, whether or not so expressed, shall be binding upon the parties hereto and their respective
successors and assigns.

 

SECTION 1.4
Unless the context otherwise requires, words in the singular include the plural and vice versa.

 

ARTICLE II

 

ACKNOWLEDGEMENT AND REPRESENTATION

 

SECTION 2.1
Each of the Hajioannou Entities acknowledges he or it has received and reviewed the Management Agreements.

 

SECTION 2.2
Each of P. Hajioannou and Machairiotissa Holdings hereby represents and warrants that as of the date of this Agreement,
Machairiotissa Holdings (a) owns at least 80% of the capital stock of each of the Managers and (b) holds at least 80% of the voting
power of the outstanding capital stock of each of the Managers considered, in each case, for this purpose as a single class.

    	4

    	

    

SECTION 2.3
Each of the Hajioannou Entities acknowledges and agrees that, pursuant to the terms of each of the Management Agreements,
during the respective term of each such Management Agreement, if a Drybulk Vessel owned by the Company and a Drybulk Vessel owned
or operated, directly or indirectly, by any of the Hajioannou Entities (other than through the Company) are both available and
meet the criteria for a charter being fixed by either of the Managers, the Company’s Drybulk Vessel shall receive such charter.
For the avoidance of doubt, this Section 2.3 shall apply only to Drybulk Vessels owned or operated, directly or indirectly,
by any Hajioannou Entity that is under the commercial management of either of the Managers, and shall not apply to any Drybulk
Vessel owned or operated, directly or indirectly, by any Hajioannou Entity that is not under the commercial management of either
of the Managers.

 

ARTICLE III

 

NON-COMPETITION

 

SECTION
3.1 During the period commencing on the Effective Date and ending one year following the date on which both Management
Agreements have been terminated (such period the “Restricted Period”), each of the Hajioannou Entities
shall not, subject to Section 3.2 hereof, directly or indirectly, engage in (a) the ownership or operation of any
Drybulk Vessel or (b) the acquisition of or investment in any Drybulk Vessel Business, other than pursuant to (i) their
involvement with the Company and its subsidiaries and (ii) their involvement with a Manager, in compliance with the terms of
the applicable Management Agreements, as the same may be waived or amended from time to time (together, (a) and (b) are
defined as the “Competitive Activities”).

 

SECTION 3.2
Notwithstanding the foregoing, the Hajioannou Entities may engage in Competitive Activities in the following circumstances:

 

(a) with respect to
any Permitted Acquisition; provided that any commercial management of Drybulk Vessels that are controlled by the
Hajioannou Entities in connection with the Permitted Acquisition is performed by either of the Managers;

 

(b) with respect to
any Drybulk Vessels or Drybulk Vessel Business included in a Non-Drybulk Acquisition; provided that (i) less than
50% of the fair market value of the Non-Drybulk Acquisition is attributable to the Drybulk Vessels and any related portion of
such business that is solely dedicated to the ownership and operation of such Drybulk Vessels, (ii) the relevant Hajioannou Entity
or Entities promptly offer to sell the Drybulk Vessels and such related portion of the business to the Company for their fair
market value plus any Break Up Costs and the majority of the Independent Directors refuse such offer and (iii) any commercial
management of Drybulk Vessels that are controlled by the Hajioannou Entities in connection with such Non-Drybulk Acquisition is
performed by either of the Managers. For purposes of this Section 3.2(b), fair market values shall be determined in good
faith by the Board of Directors;

    	5

    	

    

(c) with
respect to the passive ownership of up to 9.99% of the outstanding voting securities of any publicly traded company that is a Drybulk
Vessel Business in whole or in part; and

 

(d) with
respect to (i) a maximum of eight (8) Drybulk Vessels on the water at any one time and (ii) an unlimited number of contracts with
shipyards for newbuild Drybulk Vessels; in either case, to be directly or indirectly owned, operated or financed by P. Hajioannou
as part of his estate or family planning; provided that, in the same manner contemplated with respect to a Permitted Acquisition,
prior to the acquisition of any such Drybulk Vessels or entry into any such newbuilding contracts, such Drybulk Vessels or such
newbuilding contracts (A) have been first offered to the Company and refused by the majority of the Independent Directors and (B)
have been acquired or invested in on terms and conditions as to price that are not more favorable, and on such other terms and
conditions that are not materially more favorable, to the acquiror than those offered to the Company. For the purpose of this Section
3.2(d) it is understood and agreed that commercial management for such Drybulk Vessels may be performed by either of the Managers
or any other person or entity.

 

For the avoidance of doubt, the sale or transfer
of any legal or beneficial ownership (in whole or in part) of any Drybulk Vessel or Drybulk Vessel Business owned or operated,
directly or indirectly, by any Hajioannou Entity, shall not be subject to any right of first offer on such proposed sale or other
transfer of ownership.

 

SECTION 3.3
Nothing in this Agreement shall be construed to restrict the ability of any Hajioannou Entity to acquire, invest in, operate,
manage or charter any vessel other than Drybulk Vessels or any shipping-related business other than a Drybulk Vessel Business.

 

SECTION 3.4
In respect of any Drybulk Vessels or contracts for newbuild Drybulk Vessels owned, operated or financed by P. Hajioannou
or any P. Hajioannou Entity other than through the Company (the “Applicable Vessels”), P. Hajioannou shall, or shall
cause a P. Hajioannou Entity to, deliver a written report to the Company within the first quarter of each fiscal year that contains
the following information: (a) in respect of each such Drybulk Vessel so owned, operated or financed, the (i) name, (ii) flag,
(iii) deadweight tons, (iv) year built, (v) country of construction, (vi) class, (vii) charter information with respect to charters
arranged or in place during the period between the first day of the previous fiscal year and the date of the report, including
the type of charter employment (e.g., time or voyage charters), the charter rate, commissions paid to brokers or other third parties,
the charter period and the total revenues earned with respect to charters conducted during such period, (viii) running costs with
respect to such Drybulk Vessel in the previous fiscal year, (ix) expected date of next drydocking and the estimated cost of such
drydocking, and (x) date of next special survey; and (b) in respect of each such contract for newbuild Drybulk Vessels, charter
information, if any, with respect to charters arranged as of the date of the report, including the type of charter employment,
the charter rate, commissions paid to brokers or other third parties and the charter period. Additionally, P. Hajioannou shall,
or shall cause a P. Hajioannou Entity to, promptly provide to the Company any clarification and explanation relating to the foregoing
that the Company may reasonably request from time to time.

    	6

    	

    

ARTICLE IV

 

CONTROL OF MANAGER; RIGHT OF FIRST OFFER

 

SECTION
4.1 During the Restricted Period, in the event of a Proposed Change in Control of a Manager, the Company shall have a
30-day right of first offer to purchase the relevant Hajioannou Entities’ direct or indirect interests in the Manager
involved in the Proposed Change in Control of a Manager (“Manager First Offer Right”). Set forth in Section 4.2 are the procedures applicable to the Manager First Offer Right.

 

SECTION 4.2
Set forth below are the procedures applicable to the Manager First Offer Right. For purposes of this Section 4.2,
the term “Sale Transaction” shall mean a Proposed Change in Control of a Manager, as described in Section
4.1, in the case of a Manager First Offer Right.

 

(a) Prior
to engaging in any negotiations or otherwise offering to consummate a Sale Transaction with any third party, the relevant Hajioannou
Entity or Entities shall provide written notice of their intent to engage in a Sale Transaction (a “First Offer Notice”)
and shall specify in such First Offer Notice the material terms and conditions (including the consideration to be paid, which shall
be in cash) on which they would be willing to consummate a Sale Transaction with the Company, including any liabilities to be assumed
by the Company.

 

(b) The
Company shall notify the relevant Hajioannou Entity or Entities within the First Offer Period that either (i) the Company does
not wish to participate in a Sale Transaction (a “Negative Response”) or (ii) the Company does wish to participate
in a Sale Transaction, subject to the negotiation of the terms and conditions of the Sale Transaction in accordance with the provisions
of this Section 4.2 (an “Affirmative Response”).

 

(c) In
the event of an Affirmative Response, the Company and the relevant Hajioannou Entity or Entities shall negotiate in good faith
during the First Offer Period the terms and conditions of an agreement for the consummation of a Sale Transaction with the Company
and such terms and conditions are to be based on the terms and conditions set forth in the First Offer Notice.

 

(d) In
the event of a Negative Response or in the event the Company and the relevant Hajioannou Entity or Entities are unable to agree
on the terms and conditions of an agreement for the consummation of a Sale Transaction during the First Offer Period, then the
relevant Hajioannou Entity or Entities may consummate a Sale Transaction within 120 days after the earlier of the date the relevant
Hajioannou Entity or Entities receive a Negative Response and the end of the First Offer Period with a third party on terms and
conditions as to price that are not more favorable, and on such other terms and conditions that are not materially more favorable,
to the proposed purchaser than the terms and conditions specified in the First Offer Notice.

    	7

    	

    

(e) If
a Sale Transaction is not consummated with a third party within 120 days after the earlier of the date of the Negative Response
and the end of the First Offer Period in accordance with clause (d) above, then the relevant Hajioannou Entity or Entities shall
not thereafter engage in a Sale Transaction without first offering the Company a Manager First Offer Right, in the manner provided
above.

 

SECTION 4.3
The Hajioannou Entities and the Company acknowledge that all potential transfers pursuant to Section 3.2(a) and this
Article IV are subject to obtaining any and all written consents of governmental authorities and offer non-affiliated third
parties.

 

ARTICLE V

 

NOTICES

 

SECTION 5.1
All notices, consents and other communications hereunder, or necessary to exercise any rights granted hereunder, shall be
in writing, sent either by prepaid registered mail or telefax, and will be validly given if delivered on a Business Day to a party
at its respective address set forth below:

 

Safe Bulkers, Inc.

c/o Safety Management Overseas S.A.

32 Avenue K. Karamanli

P.O. Box 70837

16605 Voula

Athens, Greece

Attention: Chief Executive Officer

Telefax: 30-210-895-6900

 

Polys Hajioannou

c/o Safety Management Overseas S.A.

32 Avenue K. Karamanli

P.O. Box 70837

16605 Voula

Athens, Greece

Attention: Polys Hajioannou

 

Vorini Holdings Inc.

c/o Safety Management Overseas S.A.

32 Avenue K. Karamanli

P.O. Box 70837

16605 Voula

Athens, Greece

Attention: George Papadopoulos

    	8

    	

    

Machairiotissa Holdings Inc.

c/o Safety Management Overseas S.A.

32 Avenue K. Karamanli

P.O. Box 70837

16605 Voula

Athens, Greece

Attention: Antonios Prigkis

 

ARTICLE VI

 

APPLICABLE LAW AND JURISDICTION

 

SECTION 6.1
This Agreement shall be governed by, and construed in accordance with, the laws of England.

 

ARTICLE VII

 

ARBITRATION

 

SECTION 7.1
Any dispute arising out of or in connection with this Agreement shall be referred to arbitration in London in accordance
with the Arbitration Act 1996 or any statutory modification or re-enactment thereof save to the extent necessary to give effect
to the provisions of this Article VII. The arbitration shall be conducted in accordance with the London Maritime Arbitrators
Association (LMAA) Terms current at the time when the arbitration proceedings are commenced.

 

SECTION 7.2
The reference shall be to three arbitrators. If the Company on the one hand or the Hajioannou Entities on the other (with
the Hajioannou Entities being treated as one party for the purposes of this Article VII) wishes to refer a dispute to arbitration,
that party shall appoint its arbitrator and send notice of such appointment in writing to the other party requiring the other party
to appoint its own arbitrator within 14 calendar days of that notice and stating that it will appoint its arbitrator as sole arbitrator
unless the other party appoints its own arbitrator and gives notice that it has done so within the 14 days specified. If the other
party does not appoint its own arbitrator and give notice that it has done so within the 14 days specified, the party referring
a dispute to arbitration may, without the requirement of any further prior notice to the other party, appoint its arbitrator as
sole arbitrator and shall advise the other party accordingly. The award of a sole arbitrator shall be binding on both parties as
if he had been appointed by agreement. Nothing herein shall prevent the parties agreeing in writing to vary these provisions to
provide for the appointment of a sole arbitrator.

    	9

    	

    

ARTICLE VIII

 

MISCELLANEOUS

 

SECTION 8.1
This Agreement constitutes the sole understanding and agreement of the parties hereto with respect to the subject matter
hereof and supersedes all prior agreements or understandings, written or oral, with respect thereto, with the exception of the
Management Agreements. This Agreement may not be amended, waived or discharged except by an instrument in writing executed by the
party against whom enforcement of such amendment, waiver or discharge is sought.

 

SECTION 8.2 It is
the desire and intent of the parties hereto that the provisions of this Agreement be enforced to the fullest extent
permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if
any particular provision of this Agreement is adjudicated to be invalid or unenforceable, such provision will be deemed
amended to delete therefrom the portion thus adjudicated as invalid or unenforceable, such deletion to apply only with
respect to the operation of such provision in the particular jurisdiction in which such adjudications is made.

 

SECTION 8.3
This Agreement may be executed in one or more written counterparts, each of which shall be deemed an original, but all of
which together shall constitute one instrument.

 

[Remainder of page intentionally left
blank.]

    	10

    	

    

IN WITNESS whereof the undersigned have executed
this Agreement as of the date first above written.

 

	 	SAFE BULKERS, INC.
	 	 	 
	 	By:	                         
	 	Name: 
	 	Title:
	 	 	 
	 	POLYS HAJIOANNOU
	 	 
	 	 
	 	 	 
	 	VORINI HOLDINGS INC.
	 	 	 
	 	By:	 
	 	Name:
	 	Title:
	 	 	 
	 	MACHAIRIOTISSA HOLDINGS INC.
	 	 	 
	 	By:	 
	 	Name:
	 	Title:

 

[Signature Page for Hajioannou Entities
Restrictive Covenant Agreement]

    	 

    	

    

APPENDIX II

 

Form of Polys Hajioannou Restrictive
Covenant Agreement

    	 

    	

    

 

 

SAFE BULKERS, INC.,

 

- and -

 

POLYS HAJIOANNOU

 

 

 

SECOND AMENDED AND RESTATED

RESTRICTIVE COVENANT AGREEMENT

 

 

 

 

    	 

    	

    

THIS SECOND AMENDED AND RESTATED RESTRICTIVE COVENANT AGREEMENT
(this “Agreement”) is made on July [n], 2017, and amends and restates
in its entirety that certain Restrictive Covenant Agreement, dated May 29, 2008, as amended by that certain Amendment No. 1 to
Restrictive Covenant Agreement, dated February 25, 2014, and as further amended and restated by that certain Amended and Restated
Restrictive Covenant Agreement, dated May 29, 2015 (together, the “Original Agreement”),

 

BY AND BETWEEN:

 

1. SAFE BULKERS, INC., a Marshall Islands
corporation (the “Company”); and

 

2. POLYS HAJIOANNOU, in his individual capacity
(“P. Hajioannou”).

 

WHEREAS:

 

1. Pursuant to Section 8.1 of the Original
Agreement, the parties thereto may amend the Original Agreement by an instrument in writing;

 

2. Pursuant to the Second Amended and Restated
Restrictive Covenant Agreement by and between the Company and P. Hajioannou, Vorini Holdings, Inc., a Marshall Islands corporation
(“Vorini Holdings”), and Machairiotissa Holdings Inc., a Marshall Islands corporation (“Machairiotissa
Holdings” and, together with P. Hajioannou, Vorini Holdings and, together with any entity controlled by or under common
control with Machairiotissa Holdings, P. Hajioannou and/or Vorini Holdings, the “Hajioannou Entities”), dated
July [n], 2017 (the “Hajioannou Entities Restrictive Covenant Agreement”),
the Hajioannou Entities: (i) are prohibited from conducting certain activities that may compete with the business of the Company
and (ii) granted the Company a right of first offer to purchase the Hajioannou Entities’ relevant interest in each of Safety
Management Overseas S.A., a Panamanian corporation (the “SMO Manager”), and Safe Bulkers Management Limited,
a Cypriot private limited company (the “Safe Bulkers Manager,” together with the SMO Manager, the “Managers”),
in the event of a potential change of control of each such Manager, respectively; and

 

3. The Company wishes to limit the activities
of P. Hajioannou in his capacity as a director or employee of the Company, and any entity controlled by P. Hajioannou (“P.
Hajioannou Entity”), on the terms and conditions set out in this Agreement in order to prohibit certain activities that
may compete with the business of the Company.

 

NOW, THEREFORE, in consideration of the terms
and conditions set forth below and other good and valuable consideration (the receipt and sufficiency of which is hereby acknowledged),
the parties hereto agree as follows:

    	 

    	

    

ARTICLE I

 

INTERPRETATION

 

SECTION 1.1
In this Agreement, unless the context otherwise requires:

 

(a) “Agreement”
shall have the meaning set forth in the preamble.

 

(b) “Applicable
Vessels” shall have the meaning set forth in Section 3.4.

 

(c) “Board
of Directors” means the board of directors of the Company as the same may be constituted from time to time.

 

(d) “Break
Up Cost” means the aggregate amount of any and all costs including any taxes, registration fees, administrative expenses,
severance costs, and other similar costs and expenses that would be required to transfer Drybulk Vessels or any other portion of
a Non-Drybulk Acquisition that owns or operates Drybulk Vessels to the Company separately from the other assets of the Non-Drybulk
Acquisition.

 

(e) “Business
Day” means a day (excluding Saturdays and Sundays) on which banks are open for business in Athens, Greece; Cyprus; and
New York, New York.

 

(f) “Company”
shall have the meaning set forth in the preamble.

 

(g) “Company
Group” means, at any time, the Company and its subsidiaries at such time and “member of the Company Group”
shall be construed accordingly.

 

(h) “Competitive
Activities” shall have the meaning set forth in Section 3.1.

 

(i) “Drybulk
Vessel” means any ocean-going vessel (including any Newbuild) that is intended to be used primarily to transport non-liquid
cargoes of commodities shipped in an unpackaged state.

 

(j) “Drybulk
Vessel Business” means any business involved in the ownership or operation of Drybulk Vessels.

 

(k) “Effective
Date” means May 28, 2008.

 

(l) “Hajioannou
Entities” shall have the meaning set forth in the recitals.

 

(m) “Hajioannou
Entities Restrictive Covenant Agreement” shall have the meaning set forth in the recitals.

 

(n) “Independent
Directors” means those members of the Board of Directors that qualify as independent directors within the meaning of
Rule 10A-3 promulgated under the U.S. Securities Exchange Act of 1934, as amended, and the listing criteria of the New York Stock
Exchange.

    	2

    	

    

(o) “Machairiotissa
Holdings” shall have the meaning set forth in the recitals.

 

(p) “Management
Agreements” means the Safe Bulkers Manager Management Agreement and the SMO Management Agreement.

 

(q) “Managers”
shall have the meaning set forth in the recitals.

 

(r) “Newbuild”
means a new vessel to be or which has just been constructed, or is under construction, which a member of the Company Group has
agreed to acquire pursuant to a shipbuilding contract, memorandum of agreement or otherwise.

 

(s) “Non-Drybulk
Acquisition” means an acquisition or investment that includes (i) both Drybulk Vessels and vessels other than Drybulk
Vessels and/or (ii) any business that owns or operates Drybulk Vessels and vessels other than Drybulk Vessels.

 

(t) “Permitted
Acquisition” means an acquisition by P. Hajioannou of a Drybulk Vessel or an acquisition of or investment in a Drybulk
Vessel Business that (i) has been first offered to the Company and refused by the majority of the Independent Directors and (ii)
has been acquired or invested in by P. Hajioannou on terms and conditions as to price that are not more favorable, and on such
other terms and conditions that are not materially more favorable, to P. Hajioannou than those offered to the Company.

 

(u) “P.
Hajioannou” shall have the meaning set forth in the preamble.

 

(v) “P.
Hajioannou Entity” shall have the meaning set forth in the recitals, and “P. Hajioannou Entities”
shall have a corresponding meaning.

 

(w) “Restricted
Period” shall mean the period commencing on the Effective Date and ending one year following the later of (i) the termination
of P. Hajioannou’s service with the Company as a director and (ii) the termination of P. Hajioannou’s service with
the Company as an employee.

 

(x) “Safe
Bulkers Manager Management Agreement” means the Management Agreement between the Company and the Safe Bulkers Manager,
dated on or about the date of this Agreement.

 

(y) “Safe
Bulkers Manager” shall have the meaning set forth in the recitals.

 

(z) “SMO
Management Agreement” means the Amended and Restated Management Agreement between the Company and the SMO Manager, dated
on or about the date of this Agreement.

 

(aa) “SMO
Manager” shall have the meaning set forth in the recitals.

 

(bb) “Vorini
Holdings” shall have the meaning set forth in the recitals.

    	3

    	

    

SECTION 1.2
The headings of this Agreement are for ease of reference and do not limit or otherwise affect the meaning hereof.

 

SECTION 1.3
All the terms of this Agreement, whether or not so expressed, shall be binding upon the parties hereto and their respective
successors and assigns.

 

SECTION 1.4
Unless the context otherwise requires, words in the singular include the plural and vice versa.

 

ARTICLE II

 

ACKNOWLEDGEMENT

 

SECTION 2.1
P. Hajioannou acknowledges he has received and reviewed the Management Agreements.

 

SECTION 2.2
P. Hajioannou acknowledges and agrees that, pursuant to the terms of the Management Agreements, during the respective terms
of each of the Management Agreements, if a Drybulk Vessel owned by the Company and a Drybulk Vessel owned or operated, directly
or indirectly, by P. Hajioannou or any P. Hajioannou Entity (other than through the Company) are both available and meet the criteria
for a charter being fixed by either of the Managers, the Company’s Drybulk Vessel shall receive such charter. For the avoidance
of doubt, this Section 2.2 shall apply only to Drybulk Vessels owned or operated, directly or indirectly, by P. Hajioannou
or any P. Hajioannou Entity that is under the commercial management of either of the Managers, and shall not apply to any Drybulk
Vessel owned or operated, directly or indirectly, by P. Hajioannou or any P. Hajioannou Entity that is not under the commercial
management of either of the Managers.

 

ARTICLE III

 

NON-COMPETITION

 

SECTION 3.1
During the Restricted Period, P. Hajioannou shall and procures that the P. Hajioannou Entities shall, subject to Section
3.2 hereof, not directly or indirectly, engage in (a) the ownership or operation of any Drybulk Vessel or (b) the acquisition
of or investment in any Drybulk Vessel Business, other than pursuant to his involvement with (i) any member of the Company Group,
or (ii) a Manager, in compliance with the restrictions on competitive activities set out in the Management Agreements, as the same
may be waived or amended from time to time (together, (a) and (b) are defined as the “Competitive Activities”).

 

SECTION 3.2
Notwithstanding the foregoing, P. Hajioannou may engage in Competitive Activities (including through any other P. Hajioannou
Entity) in the following circumstances:

    	4

    	

    

(a) with
respect to any Permitted Acquisition; provided that any commercial management of Drybulk Vessels that are controlled by
P. Hajioannou (including through any other P. Hajioannou Entity) in connection with the Permitted Acquisition is performed by either
of the Managers;

 

(b) with
respect to any Drybulk Vessels or Drybulk Vessel Business included in a Non-Drybulk Acquisition; provided that (i) less
than 50% of the fair market value of the Non-Drybulk Acquisition is attributable to the Drybulk Vessels and any related portion
of such business that is solely dedicated to the ownership and operation of such Drybulk Vessels, (ii) P. Hajioannou promptly offers
to sell the Drybulk Vessels and such related portion of the business to the Company for their fair market value plus any Break
Up Costs and the majority of the Independent Directors refuse such offer and (iii) any commercial management of Drybulk Vessels
that are controlled by P. Hajioannou in connection with such Non-Drybulk Acquisition is performed by either of the Managers. For
purposes of this Section 3.2(b), fair market values shall be determined in good faith by the Board of Directors;

 

(c) with
respect to the passive ownership of up to 9.99% of the outstanding voting securities of any publicly traded company that is a Drybulk
Vessel Business in whole or in part; and

 

(d) with
respect to (i) a maximum of eight (8) Drybulk Vessels on the water at any one time and (ii) an unlimited number of contracts with
shipyards for newbuild Drybulk Vessels; in either case, to be directly or indirectly owned, operated or financed by P. Hajioannou
as part of his estate or family planning; provided that, in the same manner contemplated with respect to a Permitted Acquisition,
prior to the acquisition of any such Drybulk Vessels or entry into any such newbuilding contracts, such Drybulk Vessels or such
newbuilding contracts (A) have been first offered to the Company and refused by the majority of the Independent Directors and (B)
have been acquired or invested in on terms and conditions as to price that are not more favorable, and on such other terms and
conditions that are not materially more favorable, to the acquiror than those offered to the Company. For the purpose of this Section
3.2(d), it is understood and agreed that commercial management for such Drybulk Vessels may be performed by either of the Managers
or any other person or entity.

 

For the avoidance of doubt, the sale or transfer
of any legal or beneficial ownership (in whole or in part) of any Drybulk Vessel or Drybulk Vessel Business owned or operated,
directly or indirectly, by P. Hajioannou or any P. Hajioannou Entity, shall not be subject to any right of first offer on such
proposed sale or other transfer of ownership.

 

SECTION 3.3
Nothing in this Agreement shall be construed to restrict the ability of P. Hajioannou or any other P. Hajioannou Entity
to acquire, invest in, operate, manage or charter any vessel other than Drybulk Vessels or any shipping-related business other
than a Drybulk Vessel Business.

 

SECTION 3.4
In respect of any Drybulk Vessels or contracts for newbuild Drybulk Vessels owned, operated or financed by P. Hajioannou
or any P. Hajioannou Entity

    	5

    	

    

other than through the Company (the “Applicable Vessels”),
P. Hajioannou shall, or shall cause a P. Hajioannou Entity to, deliver a written report to the Company within the first quarter
of each fiscal year that contains the following information: (a) in respect of each such Drybulk Vessel so owned, operated or financed,
the (i) name, (ii) flag, (iii) deadweight tons, (iv) year built, (v) country of construction, (vi) class, (vii) charter information
with respect to charters arranged or in place during the period between the first day of the previous fiscal year and the date
of the report, including the type of charter employment (e.g., time or voyage charters), the charter rate, commissions paid to
brokers or other third parties, the charter period and the total revenues earned with respect to charters conducted during such
period, (viii) running costs with respect to such Drybulk Vessel in the previous fiscal year, (ix) expected date of next drydocking
and the estimated cost of such drydocking, and (x) date of next special survey; and (b) in respect of each such contract for newbuild
Drybulk Vessels, charter information, if any, with respect to charters arranged as of the date of the report, including the type
of charter employment, the charter rate, commissions paid to brokers or other third parties and the charter period. Additionally,
P. Hajioannou shall, or shall cause a P. Hajioannou Entity to, promptly provide to the Company any clarification and explanation
relating to the foregoing that the Company may reasonably request from time to time.

 

ARTICLE IV

 

NOTICES

 

SECTION 4.1
All notices, consents and other communications hereunder, or necessary to exercise any rights granted hereunder, shall be
in writing, sent either by prepaid registered mail or telefax, and will be validly given if delivered on a Business Day to a party
at its respective address set forth below:

 

Safe Bulkers, Inc.

c/o Safety Management Overseas S.A.

32 Avenue K. Karamanli

P.O. Box 70837

16605 Voula

Athens, Greece

Attention: Chief Executive Officer

Telefax: 30-210-895-6900

 

Polys Hajioannou

c/o Safety Management Overseas S.A.

32 Avenue K. Karamanli

P.O. Box 70837

16605 Voula

Athens, Greece

Attention: Polys Hajioannou

    	6

    	

    

ARTICLE V

 

APPLICABLE LAW AND JURISDICTION

 

SECTION 5.1
This Agreement shall be governed by, and construed in accordance with, the laws of England.

 

ARTICLE VI

 

ARBITRATION

 

SECTION 6.1
Any dispute arising out of or in connection with this Agreement shall be referred to arbitration in London in accordance
with the Arbitration Act 1996 or any statutory modification or re-enactment thereof save to the extent necessary to give effect
to the provisions of this Article VI. The arbitration shall be conducted in accordance with the London Maritime Arbitrators
Association (LMAA) Terms current at the time when the arbitration proceedings are commenced.

 

SECTION 6.2
The reference shall be to three arbitrators. A party wishing to refer a dispute to arbitration shall appoint its arbitrator
and send notice of such appointment in writing to the other party requiring the other party to appoint its own arbitrator within
14 calendar days of that notice and stating that it will appoint its arbitrator as sole arbitrator unless the other party appoints
its own arbitrator and gives notice that it has done so within the 14 days specified. If the other party does not appoint its own
arbitrator and give notice that it has done so within the 14 days specified, the party referring a dispute to arbitration may,
without the requirement of any further prior notice to the other party, appoint its arbitrator as sole arbitrator and shall advise
the other party accordingly. The award of a sole arbitrator shall be binding on both parties as if he had been appointed by agreement.
Nothing herein shall prevent the parties agreeing in writing to vary these provisions to provide for the appointment of a sole
arbitrator.

 

ARTICLE VII

MISCELLANEOUS

 

SECTION 7.1
This Agreement constitutes the sole understanding and agreement of the parties hereto with respect to the subject matter
hereof and supersedes all prior agreements or understandings, written or oral, with respect thereto, with the exception of the
Hajioannou Entities Restrictive Covenant Agreement and the Management Agreements. This Agreement may not be amended, waived or
discharged except by an instrument in writing executed by the party against whom enforcement of such amendment, waiver or discharge
is sought.

 

SECTION 7.2
It is the desire and intent of the parties hereto that the provisions of this Agreement be enforced to the fullest extent
permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if any
particular provision of this Agreement is adjudicated to be invalid

    	7

    	

    

or unenforceable, such provision will be deemed amended to delete
therefrom the portion thus adjudicated as invalid or unenforceable, such deletion to apply only with respect to the operation of
such provision in the particular jurisdiction in which such adjudications is made.

 

SECTION 7.3
This Agreement may be executed in one or more written counterparts, each of which shall be deemed an original, but all of
which together shall constitute one instrument.

 

[Remainder of page intentionally left
blank.]

    	8

    	

    

IN WITNESS whereof the undersigned have executed
this Agreement as of the date first above written.

 

	 	SAFE BULKERS, INC.
	 	 	 
	 	By:	                 
	 	Name:
	 	Title
	 	 	 
	 	POLYS HAJIOANNOU
	 	 	 
	 	 	 

 

[Signature Page to Polys Hajioannou Restrictive
Covenant Agreement]

    	 

    	

    

APPENDIX III

 

Form of Shipmanagement Agreement

    	 

    	

    

		1.	Date of Agreement	THE BALTIC AND INTERNATIONAL MARITIME COUNCIL (BIMCO)	
	 	 	STANDARD SHIP MANAGEMENT AGREEMENT
	 	 	CODE NAME: “SHIPMAN 98”
	 	 	 	 	Part I
	 	 	3.	 Managers (name, place of registered office and law
    of registry) (CI 1)	 
	2.	Owners (name, place
    of registered office and law of registry) (CI. 1)	 	 

	 	 

	 	Name	 
	 	Name	 	SAFE BULKERS MANAGEMENT LIMITED	 
	 	 	 	 

	 	 	 	Place of registered office	 
	 	 

	 	LIMASSOL, CYPRUS	 
	 	Place of registered office	 	 

	 	 

	 	Law of registry	 
	 	Law of registry	 	Republic of Cyprus	 
	 	 	 	 	 
		 	 	 	 	 
	4.	Day and year of commencement of Agreement (CI. 2)	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	5.	Crew Management (state “yes” or “no” as
    agreed) (CI. 3.1)	6.	Technical Management (stale “yes” or “no”
    as agreed) (CI. 3.2)	 
	 	 	 	 	 
	 	YES	 	YES	 
	 	 	 	 	 
	7.	Commercial Management (state “yes” or “no”
    as agreed) (CI. 3.3)	8.	Insurance Arrangements (state “yes” or “no”
    as agreed) (CI. 3.4)	 
	 	 	 	 	 
	 	YES	 	YES	 
	 	 	 	 	 
	9.	Accounting Services (state “yes” or “no”
    as agreed) (CI. 3.5)	10.	Sale or purchase of the Vessel (state “yes” or “no”
    as agreed) (CI. 3.6)	 
	 	 	 	 	 
	 	YES	 	 YES	 
	 	 	 	 	 
	11.	Provisions (state “yes” or “no” as agreed)
    (CI. 3.7)	12.	Bunkering (state “yes” or “no” as agreed)
    (CI. 3.8)	 
	 	 	 	 	 
	 	 YES	 	YES	 
	 	 	 	 	 
	 	 	 	 	 
	13. 	Chartering Services Period (only to be filled in if “yes”
    slated in Box 7) (CI. 3.3(i))	14. 	Owners’ Insurance (state alternative (i), (ii) or (iii) of CI. 6.3)	 
	 	 	 	 	 
	 	Not Applicable	 	 Clause 6.3(ii)	 
		 	 	 	 	 
	15.	Annual Management Fee (stale annual amount) (CI.
    8.1)	16.	Severance Costs (stale maximum amount) (CI.
    8 4(ii))	 
	 	 	 	 	 
	 	See clause 8.1	 	Not applicable	 
	 	 	 	 	 
	 	 	 	 	 
	17.	Day and year of termination of Agreement (CI.
    17)  	18.	Law and Arbitration (state alternative 19.1,
    19.2 or 19.3 place of
    arbitration must be stated) (CI. 19)	 
	 	 	 	 	 
	 	See clause 17	 	See clause 19.1	 
	 	 	 	 	 
	 	 	 	 	 
	19.	Notices (stale postal and cable address, telex and telefax number (or serving notice and
    communication to the Owners) (CI. 20)	20. 	Notices (state postal and cable address, telex and telefax number for serving notice and
    communication to the Managers) (CI. 20)	 
	 	 	 	 	 
	 	Safe Bulkers Inc.	 	KPMG Building – Office G1B	 
	 	30-32 Avenue K, Karamanli,	 	AGIAS FILAKSEOS 1	 
	 	P.O. Box 70837	 	3025	 
	 	16605 Voula	 	Limassol, Cyprus	 
	 	Athens, Greece	 	Attention: Managing Director	 
	 	Telefax:+30 211 1 878 510	 	 	 
	 	Attention: President	 	 	 

 

This document is a computer generated SHIPMAN 98 form printed by
authority of BIMCO. Any insertion or deletion to the form must be dearly visible. In the event of any modification made to the
pre-printed text of this document which is not clearly visible, the text of the onginal BIMCO approved document shall apply. BIMCO
assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original BIMCO approved
document and this computer generated document.

    	 

    	

    

It is mutually agreed between the party stated in Box 2 and
the party stated in Box 3 that this Agreement consisting of PART I and PART II as well as Annexes “A”
(Details of Vessel), “B” (Details or Crew), “C” (Budget) and “D” (Associated
vessels) attached hereto, shall be performed subject to the conditions contained herein. In the event of a conflict of conditions,
the provisions of PART I and Annexes “A”. ‘B’. “C”’ and “D”
shall prevail over those or PART II to the extent of such conflict but no further..

 

	Signature (s) (Owners)	Signature(s) (Managers)
	 	SAFE BULKERS MANAGEMENT LIMITED
	 	 
	 	 

 

This document is a computer generated SHIPMAN
98 form printed by authority of BIMCO. Any insertion or deletion to the form must be dearly visible. In the event of any modification
made to the pre-printed text of this document which is not clearly visible, the text of the onginal BIMCO approved document shall
apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original
BIMCO approved document and this computer generated document.

    	 

    	

    

ANNEX “A” (DETAILS OF VESSEL
OR VESSELS) TO

THE BALTIC AND INTERNATIONAL MARITIME COUNCIL (BIMCO) 

STANDARD SHIP MANAGEMENT AGREEMENT - CODE NAME: “SHIPMAN
98”

 

 

 

 

 

 

This document is a computer generated SHIPMAN 98 form printed by
authority of BIMCO. Any insertion or deletion to the form must be dearly visible. In the event of any modification made to the
pre-printed text of this document which is not clearly visible, the text of the onginal BIMCO approved document shall apply. BIMCO
assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original BIMCO approved
document and this computer generated document.

    	 

    	

    

Date of Agreement: March 31st 2015

 

Name of Vessel(s):

 

Particulars of Vessel(s):

Type of Vessel: Dry Bulk Carrier

 

GRT:

NRT:

DWT:

 

Call Sign:

IMO No:

Flag:

Class:

 

 

 

 

 

This document is a computer generated SHIPMAN
98 form printed by authority of BIMCO. Any insertion or deletion to the form must be dearly visible. In the event of any modification
made to the pre-printed text of this document which is not clearly visible, the text of the onginal BIMCO approved document shall
apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original
BIMCO approved document and this computer generated document.

    	 

    	

    

 ANNEX “B” (DETAILS OF CREW) TO

THE BALTIC AND INTERNATIONAL MARITIME COUNCIL (BIMCO) 

STANDARD SHIP MANAGEMENT AGREEMENT - CODE NAME: “SHIPMAN
98’

 

 

	Date of Agreement:	 	 
	 	 	 
	Details of Crew:	 	 
	Numbers	Rank	Nationality
	 	 	 
	1	Master	Filippino
	 	 	 
	1	Chief Engineer	Filippino
	 	 	 
	5	Officers	Filippino
	 	 	 
	14	Ratings	Filippino

 

This document is a computer generated SHIPMAN 98 form printed by
authority of BIMCO. Any insertion or deletion to the form must be dearly visible. In the event of any modification made to the
pre-printed text of this document which is not clearly visible, the text of the onginal BIMCO approved document shall apply. BIMCO
assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original BIMCO approved
document and this computer generated document.

    	 

    	

    

	ANNEX “C” (BUDGET) TO
	THE BALTIC AND INTERNATIONAL MARITIME COUNCIL (BIMCO)
	STANDARD SHIP
                                                                            MANAGEMENT AGREEMENT - CODE NAME: “SHIPMAN 98

 

Date of Agreement:

 

Manager’s Budget for the first year with effect from the Commencement
Date of this Agreement:

 

 

 

 

 

 

 

This document is a computer generated SHIPMAN
98 form printed by authority of BIMCO. Any insertion or deletion to the form must be dearly visible. In the event of any modification
made to the pre-printed text of this document which is not clearly visible, the text of the onginal BIMCO approved document shall
apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original
BIMCO approved document and this computer generated document.

    	 

    	

    

 ANNEX “D” (ASSOCIATED VESSELS)
TO

THE BALTIC AND INTERNATIONAL MARITIME COUNCIL (BIMCO) 

STANDARD SHIP MANAGEMENT AGREEMENT - CODE NAME: “SHIPMAN
98”

 

 

NOTE: PARTIES SHOULD BE AWARE THAT BY COMPLETING THIS ANNEX “D”
THEY WILL BE SUBJECT TO THE PROVISIONS OF SUB-CLAUSE 18.1(1) OF THIS AGREEMENT.

 

 

Date of Agreement:

 

Details of Associated Vessels:

 

This document is a computer generated SHIPMAN 98 form printed by
authority of BIMCO. Any insertion or deletion to the form must be dearly visible. In the event of any modification made to the
pre-printed text of this document which is not clearly visible, the text of the onginal BIMCO approved document shall apply. BIMCO
assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original BIMCO approved
document and this computer generated document.

    	 

    	

    

		1.	Definitions

In this Agreement save where the context otherwise requires,
the following words and expressions shall have the meanings hereby assigned to them.

 

“Owners” means the party identified
in Box 2.

“Managers” means the party identified in Box 3.

“Vessel” means the vessel or
vessels details of which are set out in Annex “A” attached hereto. “Business Day” shall
have the same meaning as ascribed thereto in Section 1.1 of the Group Management Agreement.

“Crew” means the Master, officers and
ratings of the numbers, rank and nationality specified in Annex “B” attached hereto.

“Crew Support Costs” means all expenses
of a general nature which are not particularly referable to any individual vessel for the time being managed by the Managers and
which are incurred by the Managers for the purpose of providing an efficient and economic management service and, without prejudice
to the generality of the foregoing, shall include the cost of crew standby pay, training schemes for officers and ratings, cadet
training schemes, sick pay, study pay, recruitment and interviews.

“Severance Costs” means the costs which
the employers are legally obliged to pay to or in respect of the Crew as a result of the early termination of any employment contract
for service on the Vessel.

“Crew Insurances” means insurances against
crew risks which shall include but not be limited to death, sickness, repatriation, injury, shipwreck unemployment indemnity and
loss of personal effects.

“Group Management Agreement” means the
Management Agreement, dated May 29, 2015, between the Parent and the Managers.

“Management Services” means the services
specified in sub-clauses 3.1 to 3.8 as indicated affirmatively in Boxes 5 to 12.

“ISM Code” means the International Management
Code for the Safe Operation of Ships and for Pollution Prevention as adopted by the International Maritime Organization (IMO) by
resolution A.741(18) or any subsequent amendment thereto.

“ISPS Code” means the International
Ship and Port Facility Security Code constituted pursuant to resolution A.924(22) of the International Maritime Organisation now
set out in Chapter XI-2 of the International Convention for the Safety of Life at Sea (SOLAS) 1974 (as amended) and the mandatory
ISPS Code as adopted by a Diplomatic Conference of the International Maritime Organisation on Maritime Security in December 2002
and includes any amendments or extensions to it and any regulation issued pursuant to it.

“Parent” means Safe Bulkers, Inc. of
Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH96960.

“STCW 95” means the International Convention
on Standards of Training, Certification and Watchkeeping for Seafarers, 1978, as amended in 1995 or any subsequent amendment thereto.

 

		2.	Appointment of Managers

With effect from the day and year stated in Box
4 and continuing unless and until terminated as provided herein, the Owners hereby appoint the Managers as the technical
and commercial managers of the Vessels and the Managers hereby agree to act as the technical and commercial managers of the
Vessel.

    	 

    	

    

		3.	Basis of Agreement

Subject to the terms and conditions herein provided, during
the period of this Agreement, the Managers shall carry out Management Services in respect of the Vessel as agents for and on behalf
of the Owners. Subject to Section 4.6 of the Group Management Agreement, the Managers shall have authority to take such actions
as they may from time to time in their absolute discretion consider to be necessary to enable them to perform this Agreement in
accordance with sound ship management practice.

 

		3.1	Crew Management

(only applicable if agreed according to Box 5)

The Managers shall provide suitably qualified Crew for
the Vessel as required by the Owners in accordance with the STCW 95 requirements, provision of which includes but is not limited
to the following functions:

		(i)	selecting and engaging the Vessel’s Crew, including payroll arrangements, pension administration, and insurances for
the Crew other than those mentioned in Clause 6;

		(ii)	ensuring that the applicable requirements of the law of the flag of the Vessel are satisfied in respect of manning levels,
rank, qualification and certification of the Crew and employment regulations including Crew’s tax, social insurance, discipline
and other requirements;

		(iii)	ensuring that all members of the Crew have passed a medical examination with a qualified doctor certifying that they are fit
for the duties for which they are engaged and are in possession of valid medical certificates issued in accordance with appropriate
flag State requirements. In the absence of applicable flag State requirements the medical certificate shall be dated not more than
three months prior to the respective Crew members leaving their country of domicile and maintained for the duration of their service
on board the Vessel;

		(iv)	ensuring that the Crew shall have a command of the English language of a sufficient standard to enable them to perform their
duties safely;

		(v)	arranging transportation of the Crew, including repatriation board and lodging as and when required at rates and types of accommodations
as customary in the industry;

		(vi)	training of the Crew and supervising their efficiency;

		(vii)	keeping and maintaining full and complete records of any labor agreements which may be entered into with the Crew and, if applicable,
conducting union negotiations;

		(viii)	operating the Managers’ drug and alcohol policy unless otherwise agreed and enforcing appropriate standing orders;

		(ix)	handle all details and negotiate or, as the case may be, appoint lawyers to handle all details and negotiate, the settlement
of any and all claims of the Crew, including but not limited to, those arising out of accidents, sickness or death, loss of personal
effects, disputes under articles or contracts of enlistment, insurance policies and fines;

		(x)	ensuring that any concerns of any charterer with respect to any members of the Crew are appropriately investigated in a timely
manner, communicating the results of such investigations to the Owner and, if appropriate, the charterer and if such concerns are
well-founded, ensuring that any appropriate remedial actions are taken without delay; and

		(xi)	keeping and maintaining all administrative and financial records relating to the Crew as required by any applicable laws and
any labor or collective agreements at any relevant member of the Group and rendering to the Owners.

 

This document is a computer generated SHIPMAN
98 form printed by authority of BIMCO. Any insertion or deletion to the form must be dearly visible. In the event of any modification
made to the pre-printed text of this document which is not clearly visible, the text of the onginal BIMCO approved document shall
apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original
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		3.2	Technical Management

(only applicable if agreed according to Box 6)

The Managers shall provide technical management necessary
for the operation of the Vessel which includes, but is not limited to, the following functions:

		(i)	provision of competent personnel to supervise the maintenance and general efficiency of the Vessel;

		(ii)	arrangement and supervision of dry dockings, repairs, Alterations and the upkeep of the Vessel to the standards required by
the Owners provided that the Managers shall be entitled to incur the necessary expenditure to ensure that the Vessel will comply
with the law of the flag of the Vessel and of the places where she trades, and all requirements and recommendations of the classification
society;

		(iii)	arrangement of the supply of necessary stores, spares and Lubricating oil;

		(iv)	appointment of surveyors and technical consultants as the Managers may consider from time to time to be necessary;

		(v)	development, implementation and maintenance of a Safety Management System (SMS) in accordance with the ISM Code (see sub-clauses
4.2 and 5.3) and of a security system in accordance with the ISPS Code; and

		(vi)	handling any claims against the builder of the Vessel arising out of the relevant shipbuilding contract, if applicable; and

		(vii)	on request by the Owners, providing the Owners with a copy of any Inspection report, survey, valuation or any other similar
report prepared by any shipbrokers, surveyors, the Class etc.,

 

		3.3	Commercial Management

(only applicable if agreed according to Box 7)

The Managers shall provide the commercial operation of
the Vessel, as required by the Owners, which includes, but is not limited to, the following functions:

		(i)	providing chartering services in accordance with the Owners’ instructions which include, but are not limited to, seeking
and negotiating employment for the Vessel and the conclusion (including the execution thereof) of charter parties or other contracts
relating to the employment of the Vessel, whether on a voyage, time, demise, contract of affreightment or other basis;, If such
a contract exceeds the period stated in Box 13, consent thereto in writing shall first be obtained from the Owners;

		(ii)	arranging of the proper payment to Owners or their nominees of all hire and/or freight revenues or other moneys of whatsoever
nature to which Owners may be entitled arising out of the employment of or otherwise in connection with the Vessel;.

		(iii)	providing voyage estimates and accounts and calculating of hire, freights, demurrage and/or despatch moneys due from or due
to the charterers of the Vessel;

		(iv)	issuing to the Crew of appropriate voyage instructions and monitoring voyage performance;

		(v)	appointing agents;

		(vi)	appointing stevedores and performing all usual and customary duties concerned with the loading and discharging of cargoes at
all ports unless performed by the charterers from time to time;

		(vii)	arranging surveys associated with the commercial operation of the Vessel;

		(viii)	carrying out the necessary communications with the shippers, charterers and other involved with the receiving and handling
of the Vessel at the relevant loading and

 

This document is a computer generated SHIPMAN
98 form printed by authority of BIMCO. Any insertion or deletion to the form must be dearly visible. In the event of any modification
made to the pre-printed text of this document which is not clearly visible, the text of the onginal BIMCO approved document shall
apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original
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			discharging ports, including sending any notices required under the terms of th Vessel’s employment at the time;

		(ix)	preparing, issuing or causing to be issued to the shippers the custiomary freight contracts, cargo receipts, bills of lading,
shipper’s customary bills or other documents required under the terms of the Vessel’s employment;

		(x)	invoicing on behalf of the Owners all freights, hires, demurrages. outgoing claims, refund of taxes, balances of disbursements,
statements of account and other sums due to the Owners and account receivables arising from the operation of the Vessel and, upon
the request of the Owners, issuing releases on behalf of the Owners upon receipt of payment or settlement of any such amounts;

		(xi)	preparing off-hire statements and/or hire statements;

		(xii)	procuring and arranging for port entrance and clearance, pilots, Vessel agents, consular approvals and other services necessary
for the management and safe operation of the Vessel;

		(xiii)	reporting to the Owners of any major casualties, damages received or caused by the Vessel or any major release or discharge
of oil or other hazardous material not in compliance with any laws;.

 

		3.4	insurance Arrangements

(only applicable if agreed according to Box 8)

The Managers shall arrange insurances in accordance with
Clause 6, on such terms and conditions as the Owners shall have instructed or agreed, in particular regarding underwriters, conditions,
insured values, deductibles and franchises.

 

		3.5	Accounting Services

(only applicable if agreed according to Box 9)

Without prejudice to the relevant provisions of the Group
Management Agreement and, in particular but without limitation, Section 4.11, Section 5.1 and Section 10.6 thereof, Tthe
Managers shall:

		(i)	establish an accounting system which meets the requirements of the Owners and provide regular accounting services, supply regular
reports and records,

		(ii)	maintain the records of all costs and expenditure incurred as well as data necessary or proper for the settlement of accounts
between the parties.

 

		3.6	Sale or Purchase of the Vessel

(only applicable if agreed according to Box 10)

The Managers shall, in accordance with the Owners’
instructions, supervise the sale or purchase of the Vessel, including the performance of any sale or purchase agreement, but not
negotiation of the same. The Managers shall, on the request of the Owners, either directly or by employing the services of a broker,
endeavor to procure a buyer for the Vessel at a price and otherwise on terms acceptable to the Owners.

 

		3.7	Provisions

(only applicable if agreed according to Box 11)

The Managers shall arrange for the supply of provisions.

 

This document is a computer generated SHIPMAN
98 form printed by authority of BIMCO. Any insertion or deletion to the form must be dearly visible. In the event of any modification
made to the pre-printed text of this document which is not clearly visible, the text of the onginal BIMCO approved document shall
apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original
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		3.8	Bunkering

(only applicable if agreed according to Box 12)

The Managers shall arrange for the provision of bunker
fuel of the quality specified by the Owners as required for the Vessel’s trade.

 

		4.	Managers’ Obligations

4.1 Without prejudice to the relevant provisions
of the Group Management Agreement and in particular, but without limitation to the foregoing, the provisions of Section 2.3, Section
4.1, Section 4.5 and Section 4.7 thereof, Tthe Managers undertake to use their best endeavours to provide the
agreed Management Services as agents for and on behalf of the Owners in accordance with sound ship management practice and to protect
and promote the interests of the Owners in all matters relating to the provision of services hereunder. Provided, however, that
the Managers in the performance of their management responsibilities under this Agreement shall be entitled to have regard to their
overall responsibility in relation to all vessels as may from time to time be entrusted to their management and in particular,
but without prejudice to the generality of the foregoing, the Managers shall be entitled to allocate available supplies, manpower
and services in such manner as in the prevailing circumstances the Managers in their absolute discretion consider to be fair and
reasonable.

 

4.2 Where the Managers are providing Technical Management
in accordance with sub-clause 3.2, they shall procure that the requirements of the law of the flag of the Vessel are satisfied
and they shall in particular be deemed to be the “Company” as defined by the ISM Code, assuming the responsibility
for the operation of the Vessel and taking over the duties and responsibilities Imposed by the ISM Code when applicable.

 

		5.	Owners’ Obligations

5.1 Without prejudice to the relevant provisions
of the Group Management Agreeemnt, Tthe Owners shall pay all sums due to the Managers punctually in accordance
with the terms of this Agreement.

 

5.2 Where the Managers are providing Technical Management
in accordance with sub-clause 3.2, the Owners shall:

		(i)	procure that all officers and ratings supplied by them or on their behalf comply with the requirements of STCW 95;

		(ii)	instruct such officers and ratings to obey all reasonable orders of the Managers in connection with the operation of the Managers’
safety management system.

 

5.3 Where the Managers are not providing Technical
Management in accordance with sub-clause 3.2, the Owners shall procure that the requirements of the law of the flag of the
Vessel are satisfied and that they, or such other entity as may be appointed by them and identified to the Managers, shall be deemed
to be the “Company” as defined by the ISM Code assuming the responsibility for the operation of the Vessel and taking
over the duties and responsibilities imposed by the ISM Code when applicable.

 

		6.	Insurance Policies

The Owners shalt procure, whether by instructing
the Managers under sub-clause 3.4 or otherwise, that throughout the period of this Agreement:

 

This document is a computer generated SHIPMAN
98 form printed by authority of BIMCO. Any insertion or deletion to the form must be dearly visible. In the event of any modification
made to the pre-printed text of this document which is not clearly visible, the text of the onginal BIMCO approved document shall
apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original
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6.1 at the Owners’ expense, the Vessel is
insured for not less than her sound market value or entered for her full gross tonnage, as the case may be for:

		(i)	usual hull and machinery marine risks [(including crew negligence)] and excess liabilities;

		(ii)	protection and indemnity risks (including pollution risks and Crew Insurances); and

		(iii)	war risks (including protection and indemnity and crew risks); and

		(iv)	any other insurance that the Owners determine or the Managers advise them in writing that, in either case, it is prudent or,
as the case may be, appropriate on the basis of prevailing market practices to be obtained in respect of the Vessel, its freight/hire
or any third party liabilities, in each case in accordance with the best practice of prudent owners of vessels of a similar type
to the Vessel, with first class insurance companies, underwriters or associations (“the Owners’ Insurances”);

 

6.2 all premiums and calls and applicable deductibles
and/or franchises on the Owners’ Insurances are paid promptly by their due date,

 

6.3 the Owners’ Insurances name the Managers
and, subject to underwriters’ agreement, any third party designated by the Managers as a joint assured, with full cover,
with the Owners obtaining cover in respect of each of the insurances specified in sub-clause 6.1:

 

		(i)	on terms whereby the Managers and any such third party are liable in respect of premiums or calls arising in connection with
the Owners’ Insurances; or

		(ii)	if reasonably obtainable, on terms such that neither the Managers nor any such third party shall be under any liability in
respect of premiums or calls arising in connection with the Owners’ Insurances; or

		(iii)	on such other terms as may be agreed in writing. Indicate alternative N, (ii) or (iii) in Box 14. If Box 14 is
left blank then (i) applies.

 

6.4 written evidence is provided, to the reasonable
satisfaction of the Managers, of their compliance with their obligations under Clause 6 within a reasonable time of the
commencement of the Agreement, and of each renewal date and, if specifically requested, of each payment date of the Owners’
Insurances.

 

		7.	Income Collected and Expenses Paid on Behalf of Owners

7.1 Without prejudice to the provisions of Section
10.7 of the Group Management Agreement, Aall moneys collected by the Managers under the terms of this Agreement
(other than moneys payable by the Owners to the Managers) and any interest thereon shall be held to the credit of the Owners in
a separate bank account.

 

7.2 Without prejudice to the provisions of Section
9.6, Section 10.5 and Section 10.8 of the Group Management Agreement, Aall expenses incurred by the Managers under the terms of
this Agreement on behalf of the Owners (including expenses as provided in Clause 8) may be debited against the Owners in
the account referred to under sub-clause 7.1 but shall in any event remain payable by the Owners to the Managers on demand.
For the avoidance of doubt, the Managers can make such demand on the Owners as well as on the Parent as provided in Section 10.5
of the Group Management Agreement. Furthermore and without prejudice to the generality of the provisions of this Clause 7, the
Managers shall, subject to being placed in

 

This document is a computer generated SHIPMAN
98 form printed by authority of BIMCO. Any insertion or deletion to the form must be dearly visible. In the event of any modification
made to the pre-printed text of this document which is not clearly visible, the text of the onginal BIMCO approved document shall
apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original
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funds by the Owners or the Parent, arrange for the payment
of all ordinary charges incurred in connection with the Management Services, including, but not limited to, all canal tolls, port
charges, any amounts due to any governmental authority with respect to the Crew and all duties and taxes in respect of the Vessel,
the cargo, hire or freight (whether levied against the Owners, the Parent or the Vessel), insurance premiums, advances of balances
of disbursements, invoices for bunkers, stores, spares, provisions, repairs and any other material and/or service in respect of
the Vessel.

 

		8.	Management Fee

8.1 The Owners shall pay to the Managers for their
services as Managers under this Agreement the management fees as stated in Sections 9.1(a) to (d) of the Group Management Agreement
which shall be payable monthly in accordance with the provisions of Article IX of the Group Management Agreement.

 

8.2 The management fee shall be subject to review
in accordance with the provisions of Section 9.4 of the Group Management Agreement.

 

8.3 Without limiting the generality of Clause
7 the Owners shall reimburse the Managers for postage and communication expenses, travelling expenses, and other out of
pocket expenses properly incurred by the Managers in pursuance of the Management Services.

 

8.4 The provisions of Section 9.3, Section 9.5 and
Section 9.6 of the Group Management Agreement shall be deemed as incorporated herein mutatis mutandis.

 

8.5 The Managers have the right to demand the payment
of any of the management fees and expenses payable under this Agreement either from the Parent or the Owners. Payment of any such
fees or expenses or any part thereof by either the Parent or the Owners shall prevent the Managers from making a claim on the other
person for the same amount to the extent that the same has been already paid to the Managers.

 

		9.	Budgets and Management of Funds

9.1 The Owners are aware that the Managers will
be preparing budgets in connection with, inter alia, the provision of the Management Services which the Managers will be submitting
for approval to the Parent in accordance with the provisions of Article X of the Group Management Agreement.

 

9.2 Without prejudice to the right of the Managers
to ask for funds in relation to the Management Services directly from the Parent in accordance with the relevant provisions of
the Group Management Agreement, the Managers shall each month request the Owners in writing for the funds required to run the Vessel
for the ensuing month, including the payment of any occasional or extraordinary item of expenditure, such as emergency repair costs,
additional insurance premiums, bunkers or provisions. Such funds shall be received by the Managers within ten running days after
the receipt by the Owners of the Managers’ written request and shall be held to the credit of the Owners in a separate bank
account.

 

This document is a computer generated SHIPMAN
98 form printed by authority of BIMCO. Any insertion or deletion to the form must be dearly visible. In the event of any modification
made to the pre-printed text of this document which is not clearly visible, the text of the onginal BIMCO approved document shall
apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original
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9.3 Notwithstanding anything contained herein to
the contrary, the Managers shall in no circumstances be required to use or commit their own funds to finance the provision of the
Management Services.

 

		10.	Managers’ Right to Sub-Contract

The Managers shall not have the right to sub-contract any
of their obligations hereunder, including those mentioned in sub-clause 3.1, without the prior written consent of the Owners
which shall not be unreasonably withheld and which shall be promptly responded to. In the event of such a sub-contract the Managers
shall remain fully liable for the due performance of their obligations under this Agreement.

 

		11.	Responsibilities

The parties agree that the provisions of Sections 11.1
to 11.4 (inclusive) of the Group Management Agreement, shall apply to this Agreement mutatis mutandis, save that references therein
to “any Shipmanagement Agreement or any Supervision Agreement” shall be omitted and references to “Parent”,
“any member of the Group”, “Manager”, “any Submanager”, “a Vessel”, “Section”,
“Management Fees” and “Article XI” shall be construed as references to the Owners, the Owners, the Managers,
any submanager, the Vessel, Clause, management fee and Clause 11, respectively, when used herein.

 

		12.	Documentation

Without prejudice to the relevant provisions of the
Group Management Agreement, where the Managers are providing Technical Management in accordance with sub-clause 3.2
and/or Crew Management in accordance with sub-clause 3.1, they shall make available, upon Owners’ request, all
documentation and records related to the Safety Management System (SMS) and/or the Crew which the Owners need in order to
demonstrate compliance with the ISM Code and STCW 95 or to defend a claim against a third party.

 

		13.	General Administration

13.1 Without prejudice to the provisions of Article
V of the Group Management Agreement, but subject to the provisions of Section 4.6 of the Group Management Agreement, the Managers
shall handle and settle all claims arising out of the Management Services hereunder and keep the Owners informed regarding any
incident of which the Managers become aware which gives or may give rise to material claims or disputes involving third parties.

 

13.2 The Managers shall, as instructed by the Owners
under this Agreement and/or, as the case may be, Section 4.6 of the Group Management Agreement, bring or defend actions, suits
or proceedings in connection with matters entrusted to the Managers according to this Agreement.

 

13.3 The Managers shall also have power to obtain
legal or technical or other outside expert advice in relation to the handling and settlement of claims and disputes or all other
matters affecting the interests of the Owners in respect of the Vessel.

 

13.4 The Owners shall arrange for the provision
of any necessary guarantee bond or other security.

 

This document is a computer generated SHIPMAN
98 form printed by authority of BIMCO. Any insertion or deletion to the form must be dearly visible. In the event of any modification
made to the pre-printed text of this document which is not clearly visible, the text of the onginal BIMCO approved document shall
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13.5 Any costs incurred by the Managers in carrying
out their obligations according to Clause 13 shall be reimbursed by the Owners.

 

		14.	Auditing

The Managers shall at all times maintain and keep true
and correct accounts and shall make the same available for inspection and auditing by the Owners at such times as may be mutually
agreed. On the termination, for whatever reasons, of this Agreement, the Managers shall release to the Owners, if so requested,
the originals where possible, or otherwise certified copies, of all such accounts and all documents specifically relating to the
Vessel and her operation. For the avoidance of any doubt, this Clause is in addition and not in substitution of the relevant provisions
of the Group Management Agreement.

 

		15.	Inspection of Vessel

The Owners shall have the right at any time after giving
reasonable notice to the Managers to inspect the Vessel for any reason they consider necessary.

 

		16.	Compliance with Laws and Regulations

The Managers will not do or permit to be done anything
which might cause any breach or infringement of the laws and regulations of the Vessel’s flag, or of the places where she
trades.

 

		17.	Duration of the Agreement

This Agreement shall come into effect on the day and
year stated in Box 4 and shall continue until the date the Group Management Agreement is terminated in accordance with
the provisions of Article XIII thereof, unless this Agreement is terminated earlier in accordance with the provision of
Clause 18 hereof

 

		18.	Termination

18.1 Owners’ default

		(i)	The Managers shall be entitled to terminate the Agreement with immediate effect by notice in writing if any moneys payable
by the Owners under this Agreement shall not have been received in the Managers’ nominated account within ten Business dDays
of receipt by the Owners of the Managers written request or if the Vessel is repossessed by the Mortgagees.

		(ii)	if the Owners:

		(a)	fail to meet their obligations under sub-clauses 5.2 and 5.3 of this Agreement for any reason within their
                                                             control, or

		(b)	proceed with the employment of or continue to employ the Vessel in the carriage of contraband, blockade running, or in an unlawful
trade, or in an unlawful trade, or on a voyage which in the reasonable opinion of the Managers is unduly hazardous or improper,
the Managers may give notice of the default to the Owners, requiring them to remedy it as soon as practically possible. In the
event that the Owners fail to remedy it within a reasonable time to the satisfaction of the Managers, the Managers shall be entitled
to terminate the Agreement with immediate effect by notice in writing.

 

This document is a computer generated SHIPMAN
98 form printed by authority of BIMCO. Any insertion or deletion to the form must be dearly visible. In the event of any modification
made to the pre-printed text of this document which is not clearly visible, the text of the onginal BIMCO approved document shall
apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original
BIMCO approved document and this computer generated document.

    	 

    	

    

18.2 Managers’ Default

 

If the Managers fail to meet their obligations under Clauses
3 and 4 of this Agreement for any reason within the control of the Managers, the Owners may give notice to the
Managers of the default, requiring them to remedy it within 20 Business Days. In the event that the Managers fail to remedy
it within a such period to the satisfaction of the Owners, the Owners shall be entitled to terminate the Agreement with
immediate effect by notice in writing.

 

18.3 Extraordinary Termination

This Agreement shall be deemed to be terminated in the
case of the sale of the Vessel or if the Vessel becomes a total loss or is declared as a constructive or compromised or arranged
total loss or is requisitioned.

 

18.4 For the purpose of sub-clause 18.3
hereof

		(i)	the date upon which the Vessel Is to be treated as having been sold or otherwise disposed of shall be the date on which the
Owners cease to be registered as Owners of the Vessel;

		(ii)	the Vessel shall not be deemed to be lost unless either she has become an actual total loss or agreement has been reached with
her underwriters in respect of her constructive, compromised or arranged total loss or if such agreement with her underwriters
is not reached it is adjudged by a competent tribunal that a constructive loss of the Vessel has occurred.

 

18.5 The parties agree that the provisions of Sections
13.4(a) to 13.4(o) (inclusive) of the Group Management Agreement, shall apply to this Agreement mutatis mutandis.

 

18.6 The termination of this Agreement shall be
without prejudice to all rights accrued due between the parties prior to the date of termination.

 

		19.	Law and Arbitration

19.1 This Agreement shall be governed by and construed
in accordance with English law and any dispute arising out of or in connection with this Agreement shall be referred to arbitration
in London in accordance with the Arbitration Act 1996 or any statutory modification or re-enactment thereof save to the extent
necessary to give effect to the provisions of this Clause. The arbitration shall be conducted in accordance with the London Maritime
Arbitrators Association (LMAA) Terms current at the time when the arbitration proceedings are commenced. The reference shall be
to three arbitrators. A party wishing to refer a dispute to arbitration shall appoint its arbitrator and send notice of such appointment
in writing to the other party requiring the other party to appoint its own arbitrator within 20 Business Days of that notice and
stating that it will appoint its arbitrator as sole arbitrator unless the other party appoints its own arbitrator and gives notice
that it has done so within the 20 Business Days specified. If the other party does not appoint its own arbitrator and give notice
that It has done so within the 20 Business Days specified, the party referring a dispute to arbitration may, without the requirement
of any further prior notice to the other party, appoint its arbitrator as sole arbitrator and shall advise the other party accordingly.
The award of a sole arbitrator shall be binding on both parties as if he had been appointed by agreement. Nothing herein shall
prevent the parties agreeing in writing to vary these provisions to provide for the appointment of a sole arbitrator. In cases
where neither the claim nor any counterclaim exceeds the sum of USD50,000 (or such other sum as the parties may agree) the arbitration
shall be conducted in

 

This document is a computer generated SHIPMAN
98 form printed by authority of BIMCO. Any insertion or deletion to the form must be dearly visible. In the event of any modification
made to the pre-printed text of this document which is not clearly visible, the text of the onginal BIMCO approved document shall
apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original
BIMCO approved document and this computer generated document.

    	 

    	

    

accordance with the LMAA Small Claims Procedure current
at the time when the arbitration proceedings are commenced.

 

19.2 This Agreement shall be governed by and construed
in accordance with Title 9 of the United States Code and the Maritime Law of the United States and any dispute arising out of or
in connection with this Agreement shall be referred to three persons at New York, one to be appointed by each of the parties hereto,
and the third by the two so chosen; their decision or that of any two of them shall be final, and for the purposes of enforcing
any award, judgement may be entered on an award by any court of competent jurisdiction. The proceedings shall be conducted in accordance
with the rules of the Society of Maritime Arbitrators, Inc. In cases where neither the claim nor any counterclaim exceeds the sum
of USD50,000 (or such other sum as the parties may agree) the arbitration shall be conducted in accordance with the Shortened Arbitration
Procedure of the Society of Maritime Arbitrators, Inc. current at the time when the arbitration proceedings are commenced.

 

19.3 This Agreement shall be governed by and construed
in accordance with the laws of the place mutually agreed by the parties and any dispute arising out of or in connection with this
Agreement shall be referred to arbitration at a mutually agreed place, subject to the procedures applicable there.

 

19.4 If Box 18 in Part I is not
appropriately filled in, sub-clause 19.1 of this Clause shall apply.

 

Note: 19.1, 19.2 and 19.3
are alternatives; indicate alternative agreed in Box 18.

 

		20.	Notices

20.1 Any notice to be given by either party to the
other party shall be in writing and may be sent by fax, registered or recorded mail or by personal service.

 

20.2 The address of the Parties for service of such
communication shall be as stated in Boxes 19 and 20, respectively.

 

This document is a computer generated SHIPMAN
98 form printed by authority of BIMCO. Any insertion or deletion to the form must be dearly visible. In the event of any modification
made to the pre-printed text of this document which is not clearly visible, the text of the onginal BIMCO approved document shall
apply. BIMCO assumes no responsibility for any loss, damage or expense as a result of discrepancies between the original
BIMCO approved document and this computer generated document.

    	 

    	

    

APPENDIX IV

 

Form of Supervision Agreement

    	 

    	

    

APPENDIX IV

 

FORM OF SUPERVISION AGREEMENT

 

THIS AGREEMENT is made the 29th day of May,
2015 BETWEEN:

 

		1.	[name of relevant member of the Group], a company incorporated under the laws of [●], whose registered office is
[ADDRESS] (the “Owner”); and

 

		2.	SAFE BULKERS MANAGEMENT LIMITED, a company incorporated under the laws of Cyprus, whose registered office is at KPMG
Building – Office G1B, AGIAS FILAKSEOS 1, 3025, Limassol, Cyprus (the “Construction Supervisor”).

 

WHEREAS:

 

By a shipbuilding contract dated         (the “Shipbuilding
Contract”) and made between [●] (the “Builder”) and the Owner, the Builder agreed to construct,
to the order of the Owner, and sell to the Owner, a [●] bulk carrier, known during construction as Hull No.[●] (the “Vessel”);

 

IT IS NOW AGREED as follows:

 

ARTICLE I

DEFINITIONS

 

SECTION 1.1
Except as otherwise defined herein, all terms defined in the Shipbuilding Contract shall have the same respective meanings
when used herein.

 

SECTION 1.2
In this Agreement, unless the context otherwise requires, the following expressions shall have the following meanings:

 

“Business Day” means:

 

(i) in relation to a payment which
is to be made hereunder or under any other document, a day, other than a Saturday or Sunday or a public holiday, on which major
retail banks in New York, and (in respect of any payments which are to be made to the Builder) [●], are open for non-automated
customer services; and

 

(ii) in any other case, a day, other
than a Saturday or Sunday or a public holiday, on which major retail banks in Athens, Greece and Cyprus are open for non-automated
customer services.

 

“Group Management Agreement”
means the Management Agreement, agreement dated May 29, 2015 made between the Parent and the Construction Supervisor.

 

“Owner’s Supplies”
means all of the items to be furnished to the Vessel by the Owner in accordance with Article [●] of the Shipbuilding Contract.

    	2

    	

    

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

 

“Spares” means the items
to be designated as spares by the parties hereto at the time of the delivery of the Vessel.

 

“Supervision Period” means
the period from the execution of this Agreement to and including the earlier of (i) the date of delivery of the Vessel pursuant
to the Shipbuilding Contract and (ii) the date this Agreement is terminated.

 

ARTICLE II

 

APPOINTMENT

 

SECTION 2.1
The Owner hereby appoints the Construction Supervisor, and the Construction Supervisor hereby agrees to act as the Owner’s
supervisor towards the Builder and as the “Owner’s Representative” under the Shipbuilding Contract for
the duration of the Supervision Period and to perform the duties and rights which rest with the Owner regarding the construction
and delivery of the Vessel in accordance with all of the provisions of the Shipbuilding Contract. The Owner shall be responsible
for, inter alia, determining the general policy of supervision of construction of the Vessel and the scope of activities
of the Construction Supervisor and, in the performance of its duties under this Agreement, the Construction Supervisor shall at
all times act strictly in accordance with any instructions or directions given to it by the Owner regarding such general policy
or, in the absence of such instructions or directions, in accordance with the standards of a prudent supervisor providing services
of the type to be provided under this Agreement, having due regard to the Owner’s interest. Any instructions so given shall
be consistent with the nature and scope of the supervision services required to be performed by the Construction Supervisor under
this Agreement and shall not require the Construction Supervisor to do or omit to do anything which may be contrary to any applicable
law of any jurisdiction or which is inconsistent or contrary to any of the rights and duties of the Owner under the Shipbuilding
Contract. Upon appointment the Owner shall furnish the Construction Supervisor with a full and complete copy of the Shipbuilding
Contract (which for the avoidance of doubt shall include the Specifications and the Plans).

 

SECTION
2.2 Specific Powers and Duties of the Construction Supervisor. Without prejudice to the generality of the
appointment made under Section 2.1, and (where applicable) by way of addition to the rights, powers and duties so
conferred, the Construction Supervisor shall, subject to this Section 2.2 and to Articles III and IV,
have and be entrusted with the following rights, powers and duties in relation to the Shipbuilding Contract and the
Vessel:

 

(a)
to review, comment on, agree and approve the lists of plans and the drawings referred to; to attend the testing of the Vessel’s
machinery, outfitting and equipment and to request any tests or inspections which the Construction Supervisor may consider appropriate
or desirable and to review and comment on the results of all tests and inspections to the extent this is possible under the terms
of the Shipbuilding Contract; to carry out such inspections and give such advice or suggestions to the Builder as the Construction
Supervisor may consider appropriate and as the terms of the Shipbuilding

    	3

    	

    

Contract allow him to do; and to give notice to the
Builder in the event that the Construction Supervisor discovers any construction, material or workmanship which the Construction
Supervisor believes does not or will not conform to the requirements of the Shipbuilding Contract and the specifications again
provided the terms of the Shipbuilding Contract allows for such notice to be given;

 

(b)
to appoint a representative of the Construction Supervisor for the purposes specified in Article [●] of the Shipbuilding
Contract;

 

(c)
if any alteration or addition to the Shipbuilding Contract becomes obligatory or desirable, to consult with the Builder
and make recommendations to the Owner as to whether or not acceptance should be given to any proposal notified to the Owner by
the Builder;

 

(d)
to request and agree to any minor alterations, additions or modifications to the Vessel or the specifications and any substitute
materials pursuant to Article [●] which the Construction Supervisor may consider appropriate or desirable, provided that
if the cost of such variations or substitute materials would have the effect of altering the Contract Price (as defined in the
Shipbuilding Contract) by more than [five per cent (5%)] from the Contract Price on the date hereof or the amount of any of the
installments of the Contract Price due under the Shipbuilding Contract prior to the delivery of the Vessel, the Construction Supervisor
shall notify the same to the Owner in writing and obtain the Owner’s instructions before taking any action in relation thereto;
to receive from and transmit to the Builder information relating to the requirements of the classification society and to give
instructions and agree with the Builder regarding alterations, additions or changes in connection with such requirements; and to
approve the substitution of materials as requested by the Builder;

 

(e)
to attend and witness the trials of the Vessel to the extent this is permitted under the terms of the Shipbuilding Contract;

 

(f)
to determine whether the Vessel has been designed, constructed, equipped and completed in accordance with, and complies
with, the Shipbuilding Contract and the Specifications and Plans (each as defined in the Shipbuilding Contract); to give the Builder
a notice of acceptance or (as the case may be) rejection of the Vessel, to require or request any further test and inspection of
the Vessel to the extent this is possible under the terms of the Shipbuilding Contract, and to give and receive any further or
other notice relative to such matters and generally to advise the Owner in respect of all such matters;

 

(g)
to sign on behalf of the Owner any protocols as to sea trials, consumable stores, delivery and acceptance or otherwise,
having first ascertained with the Owner the appropriateness of so doing;

 

(h)
to accept on behalf of the Owner the documents specified in Article [●], Paragraph [●] of the Shipbuilding Contract
to be delivered by the Builder at delivery of the Vessel under the Shipbuilding Contract and to confirm receipt thereof to the
Owner;

    	4

    	

    

(i)
to give and receive on behalf of the Owner any notice contemplated by the Shipbuilding Contract, provided that the Construction
Supervisor shall not have authority to give on behalf of the Owner any notice which the Owner may be entitled to give to cancel,
repudiate or rescind the Shipbuilding Contract without the prior written consent of the Owner; and

 

(j)
to purchase, after being placed in funds by the Owner, all Owner’s Supplies as agent of the Owner and supply and deliver
the same together with all necessary specifications, plans, drawings, instruction books, manuals, test reports and certificates
to the Builder as provided in the Shipbuilding Contract, and provide to the Owner a list of all such Owner’s Supplies as
soon as possible.

 

SECTION 2.3
The Construction Supervisor shall discharge its responsibilities under this Clause 2 as the Owner’s agent.

 

SECTION 2.4
In the event that the Construction Supervisor uses its own funds to purchase Owner’s Supplies, the cost of supplying
and delivering Owner’s Supplies pursuant the relevant terms of the Shipbuilding Contract shall be reimbursed by the Owner
to the Construction Supervisor on the date the Construction Supervisor submits to the Owner supporting invoices in respect of such
cost.

 

ARTICLE III

 

CONSTRUCTION SUPERVISOR’S DUTIES

REGARDING CONSTRUCTION

 

SECTION 3.1
The Construction Supervisor undertakes with the Owner with respect to the Shipbuilding Contract:

 

(a)
to notify the Owner in writing promptly on becoming aware of any likely change to any of the dates on which any installment
under the Shipbuilding Contract is expected to be due;

 

(b)
to (i) notify the Owner in writing of the expected date on which the launching or, as the case may be, sea trials of the
Vessel is or are to take place and (ii) promptly on the same day as the launching or, as the case may be, sea trials of the Vessel
takes or take place to confirm that the launching or, as the case may be, sea trials of the Vessel has or have taken place and,
where relevant, that the amount specified in such confirmation is due and payable;

 

(c)
to (i) advise the Owner in writing, four (4) Business Days prior to the date on which the delivery installment under the
Shipbuilding Contract is anticipated to become due, of the times and amounts of payments to be made to the Builder under the Shipbuilding
Contract and any amount due to the Construction Supervisor for Owner’s Supplies not already settled and (ii) promptly confirm
the same on the day on which such installment becomes due under the terms of the Shipbuilding Contract;

    	5

    	

    

(d)
not to accept the Vessel or delivery of the Vessel on the Owner’s behalf without the Owner’s prior written approval
and unless the Construction Supervisor shall have previously certified to the Owner in writing, in the form of the certificate
set out in Schedule 1 to this Agreement, that:

 

(i)
the Vessel has been duly completed and is ready for delivery to and acceptance by the Owner in or substantially in accordance
with the Shipbuilding Contract and the Specifications and Plans;

 

(ii)
there is, to the best of the Construction Supervisor’s knowledge and belief having made due enquiry with the Builder,
no lien or encumbrance on the Vessel other than the lien in favor of the Builder in respect of the delivery installment of the
Contract Price due in accordance with the relevant terms of the Shipbuilding Contract;

 

(iii)
the Vessel is recommended for classification by the relevant classification society referred to in the Shipbuilding Contract
(and the Construction Supervisor shall attach to its certificate the provisional certificate of such classification society recommending
such classification of the Vessel or a duplicate or photocopy of such provisional certificate or otherwise provide evidence of
such classification to the Owner);

 

(e)
on receipt thereof from the Builder promptly to deliver the documents specified in Article [●], Paragraph [●]
of the Shipbuilding Contract to the Owner or as the Owner may direct; and

 

(f)
solely with the prior written approval of the Owner, to request from or agree with the Builder any material alterations,
additions or modifications to the Vessel.

 

ARTICLE IV

 

CONSTRUCTION SUPERVISOR’S GENERAL
OBLIGATIONS

 

SECTION 4.1
The Construction Supervisor undertakes to the Owner, with respect to the exercise and performance of its rights, powers
and duties as the Owner’s representative under this Agreement, as follows:

 

(a)
it will ensure the due and punctual observance and performance of all conditions, duties and obligations imposed on the
Owner by the Shipbuilding Contract (other than to pay the Contract Price) and will not without the prior written consent of the
Owner:

 

(i)
exercise any rights of the Owner to cancel, repudiate or rescind the Shipbuilding Contract;

 

(ii)
waive, modify or suspend any provision of the Shipbuilding Contract if as a result of such waiver, modification or suspension
the Owner will or may suffer any adverse consequences; and

    	6

    	

    

(b)
it will, at its own expense, keep all necessary and proper books, accounts, records and correspondence files relating to
its duties and activities under this Agreement and shall send quarterly reports to the Owner concerning the progress of the design
and construction of the Vessel and keep the Owner promptly informed of any deviations from the building program.

 

ARTICLE V

 

LIABILITY AND INDEMNITY

 

SECTION 5.1
Save for the obligation of the Owner to pay any moneys due to the Construction Supervisor hereunder, neither the Owner nor
the Construction Supervisor shall be under any liability to the other for any failure to perform any of their obligations hereunder
by reason of Force Majeure. “Force Majeure” shall mean any cause whatsoever of any nature or kind beyond the
reasonable control of the Owner or the Construction Supervisor, including, without limitation, acts of God, acts of civil or military
authorities, acts of war or public enemy, acts of any court, regulatory agency or administrative body having jurisdiction, insurrections,
riots, strikes or other labor disturbances, embargoes or other causes of a similar nature.

 

SECTION 5.2
The Construction Supervisor, including its officers, directors, employees, shareholders, agents, and any sub-contractors
(the “Construction Supervisor Related Parties”), shall be under no liability whatsoever to the Owner or to any
third party (including the Builder) for any loss, damage, delay or expense of whatsoever nature, whether direct or indirect (including
but not limited to loss of profit arising out of or in connection with the delayed or non-conforming delivery of the Vessel), and
howsoever arising in the course of the performance of this Agreement, unless and to the extent that the same is proved to have
resulted solely from the gross negligence or willful misconduct of the Construction Supervisor, its officers, employees, agents
or any of its sub-contractors.

 

SECTION 5.3
The Owner shall indemnify and hold harmless the Construction Supervisor Related Parties against all actions, proceedings,
claims, demands or liabilities whatsoever or howsoever arising which may be brought against them or incurred or suffered by them
arising out of or in connection with the performance of this Agreement and against and in respect of any loss, damage, delay or
expense of whatsoever nature (including legal costs and expenses on a full indemnity basis), whether direct or indirect, incurred
or suffered by any Construction Supervisor Related Party in the performance of this Agreement, unless incurred or suffered due
to the gross negligence or willful misconduct of any Construction Supervisor Related Party.

 

SECTION 5.4
It is hereby expressly agreed that no employee or agent of the Construction Supervisor (including any sub-contractor from
time to time employed by the Construction Supervisor) shall in any circumstances whatsoever be under any liability whatsoever to
the Owner or any third party for any loss, damage or delay of whatsoever kind arising or resulting directly or indirectly from
any act, neglect or default on his part while acting in the course of or in connection with his employment and, without prejudice
to the generality of the foregoing provisions in this Article V, every exemption, limitation, condition and liberty herein
contained and every right, exemption from liability, defense and immunity of whatsoever

    	7

    	

    

nature applicable to the Construction Supervisor or to which
the Construction Supervisor is entitled hereunder shall also be available and shall extend to protect every such employee or agent
of the Construction Supervisor acting as aforesaid, and for the purpose of all the foregoing provisions of this Article V,
the Construction Supervisor is or shall be deemed to be acting as agent or trustee on behalf of and for the benefit of all persons
who are or might be their servants or agents from time to time (including sub-contractors as aforesaid) and all such persons shall
to this extent be or be deemed to be parties to this Agreement.

 

SECTION 5.5
The provisions of this Article V shall survive any termination of this Agreement.

 

ARTICLE VI

 

FEES

 

SECTION 6.1
In consideration of the performance of the duties assigned to the Construction Supervisor in this Agreement, the Owner shall
pay to the Construction Supervisor the sum of up to US$550,000 for its total supervision costs in connection with the supervision
of the construction of the Vessel, plus any expenses incurred under the Shipbuilding Contract against presentation of supporting
invoices from the Construction Supervisor which the Construction Supervisor shall supply to the Owner at the same time as payment
is requested. The fee payable hereunder to the Construction Supervisor shall include all costs which are incurred by the Construction
Supervisor in connection with the ordinary exercise and performance by the Construction Supervisor of the rights, powers and duties
entrusted to it pursuant to this Agreement. The supervision fee will be paid in two installments as follows:

 

(a)
US$275,000 on execution of this Agreement; and

 

(b)
US$275,000 upon the Construction Supervisor advising the Owner of the completion of the sea trial run of the Vessel.

 

For the avoidance of doubt, the Construction Supervisor can
demand payment of the fee and other amounts payable hereunder from the Parent pursuant to the relevant provisions of the Group
Management Agreement.

 

ARTICLE VII

 

COMMENCEMENT - TERMINATION

 

SECTION
7.1 This Agreement shall come into effect on the date hereof and shall continue until the delivery of the Vessel in
accordance with the Shipbuilding Contract unless terminated earlier pursuant to the terms of Section 7.2, Section 7.3 Section 7.4 or Section 7.5 hereof.

 

SECTION 7.2
The Owner shall be entitled to terminate this Agreement by notice in writing to the Construction Supervisor if the Construction
Supervisor defaults in the performance of any material obligation under this Agreement, subject to a cure right of 20 Business
Days following written notice by the Owner.

    	8

    	

    

SECTION 7.3
This Agreement shall terminate automatically if:

 

(a)
the Shipbuilding Contract is cancelled, rescinded or terminated; or

 

(b)
the Group Management Agreement is terminated.

 

SECTION 7.4
The Construction Supervisor shall be entitled to terminate this Agreement by notice in writing to the Owner if:

 

(a)
any moneys payable by the Owner under this Agreement is not paid when due or if due on demand within 10 Business Days following
demand by the Construction Supervisor; or

 

(b)
the Owner defaults in the performance of any other material obligations under this Agreement, subject to a cure right of
20 Business Days following written notice by the Construction Supervisor; or

 

SECTION 7.5
Either party shall be entitled to terminate this Agreement immediately if:

 

(a)
the other party ceases to conduct business, or all or substantially all of the equity-interests, properties or assets of
either such party is sold, seized or appropriated; or

 

(b)
(i) the other party files a petition under any bankruptcy law, makes an assignment for the benefit of its creditors, seeks
relief under any law for the protection of debtors or adopts a plan of liquidation; (ii) a petition is filed against the other
party seeking to have it declared insolvent or bankrupt and such petition is not dismissed or stayed within 40 Business Days of
its filing; (iii) the other party shall admit in writing its insolvency or its inability to pay its debts as they mature; (iv)
an order is made for the appointment of a liquidator, manager, receiver or trustee of the other party of all or a substantial part
of its assets; (v) or if an encumbrancer takes possession of or a receiver or trustee is appointed over the whole or any part of
the other party’s undertaking, property or assets; or (vi) if an order is made or a resolution is passed for the other party’s
winding up; or

 

(c)
a distress, execution, sequestration or other process is levied or enforced upon or sued out against the other party’s
property which is not discharged within 20 Business Days; or

 

(d)
the other party ceases or threatens to cease wholly or substantially to carry on its business otherwise than for the purpose
of a reconstruction or amalgamation without insolvency previously approved by the terminating party; or

 

(e)
the other party is prevented from performing its obligations hereunder by reasons of Force Majeure for a period of two or
more consecutive months.

 

SECTION 7.6
In the event of termination due to the Construction Supervisor’s default, then it shall not be entitled to receive
any payment in respect of the fees and

    	9

    	

    

other amounts described in Article
VI becoming due and payable after the date of such termination.

 

ARTICLE VIII

 

EMPLOYEES

 

SECTION
8.1 None of the employees and/or sub-contractors of the Construction Supervisor shall constitute, for the purposes of
this Agreement, sub-agents of the Owner. The Construction Supervisor, in its capacity as employer and contractor (and not in
its capacity as agent for the Owner), shall (a) be responsible for the salaries, expenses and costs in respect of each of its
employees and sub-contractors (not in its capacity as agent for the Owner) and (b) save for the provisions of Article
V hereof, indemnify its employees and sub-contractors for any liabilities and losses incurred by such employees and
sub-contractors.

 

ARTICLE IX

 

GOVERNING LAW - ARBITRATION

 

SECTION 9.1
This Agreement shall be governed by and be construed in accordance with the laws of England.

 

SECTION 9.2
Any dispute arising out of or in connection with this Agreement shall be referred to arbitration in London in accordance
with the Arbitration Act 1996 or any statutory modification or re-enactment thereof save to the extent necessary to give effect
to the provisions of this Article IX. The arbitration shall be conducted in accordance with the London Maritime Arbitrators
Association (LMAA) Terms current at the time when the arbitration proceedings are commenced.

 

SECTION 9.3
The reference shall be to three arbitrators. A party wishing to refer a dispute to arbitration shall appoint its arbitrator
and send notice of such appointment in writing to the other party requiring the other party to appoint its own arbitrator within
14 calendar days of that notice and stating that it will appoint its arbitrator as sole arbitrator unless the other party appoints
its own arbitrator and gives notice that it has done so within the 14 days specified. If the other party does not appoint its own
arbitrator and give notice that it has done so within the 14 days specified, the party referring a dispute to arbitration may,
without the requirement of any further prior notice to the other party, appoint its arbitrator as sole arbitrator and shall advise
the other party accordingly. The award of a sole arbitrator shall be binding on both parties as if he had been appointed by agreement.
Nothing herein shall prevent the parties agreeing in writing to vary these provisions to provide for the appointment of a sole
arbitrator.

 

ARTICLE X

 

COUNTERPARTS

 

SECTION 10.1
This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same
instrument.

    	10

    	

    

ARTICLE XI

 

NOTICES

 

SECTION 11.1
Every notice or other communication under this Agreement shall:

 

(a)
be in writing delivered personally or by first-class prepaid letter (airmail if available) or facsimile transmission or
other means of telecommunication (other than telex) in permanent written form;

 

(b)
be deemed to have been received, 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 (other than telex) in permanent
written form, at the time of dispatch (provided that if the date of dispatch is a Saturday or Sunday or a public holiday in the
country of the addressee or if the time of dispatch 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 day which is not a Saturday or Sunday or public holiday); and

 

(c)
be sent:

 

(i) to
the Construction Supervisor at:

 

KPMG Building – Office G1B

AGIAS FILAKSEOS 1

3025

Limassol, Cyprus

Attention: Managing Director

 

(ii) to
the Owner at:

 

c/o Safe Bulkers, Inc.

32 Avenue K. Karamanli

P.O. Box 70837

16605 Voula

Athens, Greece

Facsimile No.: +30 210 895 6900

Attention: President

 

or to such other address and/or numbers for a party as is notified
by such party to the other party under this Agreement.

 

SECTION 11.2
Each communication and document made or delivered by one party to another pursuant to this Agreement shall be in the English
language.

    	11

    	

    

SECTION 11.3
This Agreement shall not create benefits on behalf of any other person not a party to this Agreement, and this Agreement
shall be effective only as between the parties hereto, their successors and permitted assigns.

    	12

    	

    

IN WITNESS of which this Agreement
has been duly executed the day and year first before written.

 

	 	For the Owner
	 	 
	 	[●]
	 	 
	 	By:	               
	 	Name:	 
	 	Title:	 
	 	 	 
	 	For the Construction Supervisor
	 	 
	 	SAFE BULKERS MANAGEMENT LIMITED
	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 

 

[Signature Page to Supervision Agreement]

    	 

    	

    

SCHEDULE 1

 

FORM OF CONSTRUCTION CERTIFICATE 

 

[On the letterhead of the Construction
Supervisor]

 

[Vessel Owner] (the “Owner”)

[Address]

Facsimile: [  ]

Attention: [  ]

 

	 	Date: 	  

 

Dear Sirs,

 

[Name of Builder] (the “Builder”), [Name
of Vessel] (the “Vessel”)

 

We refer to the construction supervision
agreement dated [  ] between the Owner and us (the “Supervision Agreement”).

 

Words and expressions defined in the Supervision
Agreement (whether expressly or by incorporation by reference to another document) shall have the same meaning where used in this
certificate.

 

We hereby certify, pursuant to Section 3.1(d)
of the Supervision Agreement, as follows:

 

		(i)	the Vessel has been duly completed and is ready for delivery to and acceptance by the Owner in or substantially in accordance
with the Shipbuilding Contract and the Specifications and Plans; and

 

		(ii)	the Vessel is recommended for classification by [Name of the classification society] (the “Classification Society”).

    	 

    	

    

With respect to paragraph (ii) above, please
find attached to this certificate the provisional certificate of the Classification Society recommending such classification of
the Vessel / a duplicate or photocopy of the provisional certificate of the Classification Society recommending such classification
of the Vessel / the following evidence of the Classification Society’s recommendation of such classification of the Vessel
[  ].

 

	 	Yours faithfully,
	 	 
	 	 
	 	for and on behalf of
	 	SAFE BULKERS MANAGEMENT LIMITED

    	3

    	

    

SCHEDULE A

 

Shipowning Subsidiaries

    	 

    	

    

SCHEDULE B

 

Non-Shipowning Subsidiaries

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