Document:

Exhibit 10.38

                                DATED 22 MAY 2008

                          EFRAGEL SHIPPING CORPORATION

                                  (AS BORROWER)

                                      -AND-

                                DNB NOR BANK ASA

                                   (AS LENDER)

             ------------------------------------------------------

                    FIRST SUPPLEMENTAL AGREEMENT TO A SECURED
           REDUCING REVOLVING MULTI-CURRENCY CREDIT FACILITY AGREEMENT
                              DATED 11 JANUARY 2008

             ------------------------------------------------------

                               STEPHENSON HARWOOD

                           ONE, ST. PAUL'S CHURCHYARD

                                 LONDON EC4M 8SH

                               TEL: 020 7329 4422

                               FAX: 020 7329 7100

                                   REF: 04.142

<PAGE>

                                    CONTENTS

                                                                            PAGE

1    Interpretation............................................................8

2    Conditions...............................................................27

3    Representations and Warranties...........................................61

4    Amendments to Original Facility Agreement................................62

5    Confirmation and Undertaking............................................337

6    Communications, Law and Jurisdiction....................................340

SCHEDULE 1:  Form of Compliance Certificate..................................346

<PAGE>

SUPPLEMENTAL AGREEMENT

DATED:   MAY 2008

BETWEEN:

(1)      EFRAGEL SHIPPING CORPORATION, a company incorporated under the laws of
         the Republic of Liberia whose registered office is at 80 Broad Street,
         Monrovia, Liberia (the "BORROWER"); and

(2)      DNB NOR BANK ASA, acting through its office at 20 St. Dunstan's Hill,
         London EC3R 8HY, England (the "LENDER").

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

WHEREAS:

(A)      The Borrower has informed the Lender that it wishes to enter into a
         series of transactions (the "REORGANIZATION") as a result of which: (a)
         its shares will cease to be wholly owned by its present shareholders;
         (b) the Corporate Guarantor will own 100% of the Borrower's shares; and
         (c) its ownership structure will change following the initial public
         offering of the common stock of the Corporate Guarantor in the New York
         Stock Exchange (the "OFFERING").

(B)      The Borrower has requested the Lender to proceed in amending, inter
         alia, clauses 13.2.17 and 14.1.8 of the Original Facility Agreement,
         which would otherwise be breached upon the occurrence of the
         Reorganization and the Offering, and to

<PAGE>

         delete,  inter alia,  clause 13.2.14 and to amend,  inter alia,  clause
         13.2.13 of the Original Facility Agreement.

(C)      The Lender is willing to accede to such requests as listed in Recital B
         above and has agreed to amend the Original Facility Agreement and the
         Security Documents (as applicable) on the terms and subject to the
         conditions contained in this Supplemental Agreement.

                                       2
<PAGE>

IT IS AGREED THAT:

1        INTERPRETATION

         1.1      In this Supplemental Agreement

                  1.1.1    "ADDITIONAL DOCUMENTS" means the Supplemental
                           Agreement, the Guarantees and the Operating Account
                           Charge.

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

                  1.1.3    "AVSTES GUARANTEE" means the guarantee and indemnity
                           granted by Avstes in respect of the Indebtedness in
                           favour of the Lender, in such form and containing
                           such terms and conditions as the Lender shall
                           require.

                  1.1.4    "CORPORATE GUARANTEE" means the guarantee and
                           indemnity to be granted by the Corporate Guarantor in
                           favour of the Lender.

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

                  1.1.6    "EFFECTIVE DATE" means the date of the Listing, such
                           date falling no later than 30 August 2008.

                  1.1.7    "GROUP GUARANTEES" means the Marindou Guarantee, the
                           Pelea Guarantee and the Avstes Guarantee, and "GROUP
                           GUARANTEE" means any one of them.

                                       3
<PAGE>

                  1.1.8    "GROUP GUARANTOR" means any one of Marindou, Pelea or
                           Avstes, and "GROUP GUARANTORS" means more than one of
                           them.

                  1.1.9    "GUARANTEES" means the Group Guarantees and the
                           Corporate Guarantee and "GUARANTEE" means any one of
                           them.

                  1.1.10   "GUARANTORS" means the Group Guarantors and the
                           Corporate Guarantor and "GUARANTOR" means any one of
                           them.

                  1.1.11   "LISTING" the effective trading date of the shares of
                           the Corporate Guarantor listed on the New York Stock
                           Exchange.

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

                  1.1.13   "MARINDOU GUARANTEE" means the guarantee and
                           indemnity granted by Marindou in respect of the
                           Indebtedness in favour of the Lender, in such form
                           and containing such terms and conditions as the
                           Lender shall require.

                  1.1.14   "OPERATING ACCOUNT CHARGE" means the first priority
                           deed of charge over the Operating Account to be
                           executed by the Borrower in favour of the Lender.

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

                                       4
<PAGE>

                  1.1.16   "PELEA GUARANTEE" means the guarantee and indemnity
                           granted by Pelea in respect of the Indebtedness in
                           favour of the Lender, in such form and containing
                           such terms and conditions as the Lender shall
                           require.

                  1.1.17   "SIDE LETTER" means a side letter evidencing the
                           Current Shareholders of the Corporate Guarantor on
                           the date of the Listing issued by the Corporate
                           Guarantor in favour of the Lender in such form as the
                           Lender may require.

                  1.1.18   "SUPPLEMENTAL AGREEMENT" means this Supplemental
                           Agreement.

         1.2      All words and expressions defined in the Original Facility
                  Agreement and in Clause 4 of this Supplemental Agreement shall
                  have the same meaning when used in this Supplemental Agreement
                  unless the context otherwise requires, and clause 1.2 of the
                  Original Facility Agreement shall apply to the interpretation
                  of this Supplemental Agreement as if it were set out in full.

2        CONDITIONS

         2.1      CONDITIONS SUBSEQUENT - INITIAL The Borrower shall deliver or
                  cause to be delivered to or to the order of the Lender within
                  five (5) Business Days from the Effective Date the following
                  documents and evidence:

                  2.1.1    BORROWER'S OFFICER'S CERTIFICATE A certificate from a
                           duly authorised officer of the Borrower confirming
                           that none of the documents delivered to the Lender
                           pursuant to Schedule 1 Part

                                       5
<PAGE>

                           I (a), (c) and (e) of the Original Facility Agreement
                           have been amended or modified in any way since the
                           date of their delivery to the Lender, or copies,
                           certified by a duly authorised officer of the
                           Borrower as true, complete, accurate and neither
                           amended nor revoked, of any which have been amended
                           or modified.

                  2.1.2    BORROWER'S AND GUARANTORS' OFFICER'S CERTIFICATES A
                           certificate of a duly authorised officer of the
                           Borrower and each Guarantor certifying that each copy
                           document relating to it specified in Clauses 2.1.3
                           (other than in respect of the Borrower) to 2.1.6 is
                           correct, complete and in full force and effect as at
                           a date no earlier than five days prior to the date of
                           this Supplemental Agreement and setting out the names
                           of the directors and officers of the Borrower and the
                           respective Guarantor.

                  2.1.3    CONSTITUTIONAL DOCUMENTS Copies of the constitutional
                           documents of each Guarantor together with such other
                           evidence as the Lender may reasonably require that
                           the Guarantor in question is duly incorporated in its
                           country of incorporation and remains in existence
                           with power to enter into, and perform its obligations
                           under, the relevant Guarantee.

                  2.1.4    RESOLUTIONS A copy, certified by a director or the
                           secretary of the Security Party in question as true,
                           complete and accurate

                                       6
<PAGE>

                           and neither amended nor revoked, of a resolution of
                           the directors and, a resolution of the shareholders
                           of each Security Party (together, where appropriate,
                           with signed waivers of notice of any directors' or
                           shareholders' meetings) approving, and authorising or
                           ratifying the execution of, this Supplemental
                           Agreement and any document to be executed by that
                           Security Party pursuant to this Supplemental
                           Agreement.

                  2.1.5    POWERS OF ATTORNEY A notarially attested and
                           legalised power of attorney of each of the Security
                           Parties (other than the Corporate Guarantor) and a
                           duly executed power of attorney in respect of the
                           Corporate Guarantor under which this Supplemental
                           Agreement and any documents required pursuant to it
                           are to be executed by that Security Party.

                  2.1.6    CERTIFICATES OF GOOD STANDING A certificate of good
                           standing in respect of each Security Party (if such a
                           certificate can be obtained).

                  2.1.7    ADDITIONAL DOCUMENTS The Additional Documents duly
                           executed by all parties thereto.

                  2.1.8    LEGAL OPINIONS A legal opinion of the legal advisers
                           of the Lender in the relevant jurisdiction,
                           substantially in the form or forms provided to the
                           Lender prior to signing of this Supplemental
                           Agreement or confirmation satisfactory to the Lender
                           that such a legal opinion will be given.

                                       7
<PAGE>

                  2.1.9    OTHER AUTHORISATIONS A copy of any other consent,
                           licence, approval, authorisation or other document,
                           opinion or assurance which the Lender considers to be
                           necessary or desirable (if it has notified the
                           Security Parties accordingly) in connection with the
                           entry into and performance of the transactions
                           contemplated by any of the Additional Documents or
                           for the validity and enforceability of any of the
                           Additional Documents.

                  2.1.10   SIDE LETTER The side letter evidencing the Current
                           Shareholders of the Corporate Guarantor issued by the
                           Corporate Guarantor in favour of the Lender in such
                           form as the Lender may require.

                  2.1.11   PROCESS AGENT Evidence that any process agent
                           referred to in Clause 22.5 of the Agreement and any
                           process agent appointed under any other Finance
                           Document has accepted its appointment.

         2.2      CONDITIONS SUBSEQUENT -ADDITIONAL The Borrower shall deliver
                  or cause to be delivered to or to the order of the Lender
                  within thirty (30) days from the Effective Date, the following
                  documents and evidence:-

                  2.2.1    LEGAL OPINIONS The legal opinions specified in Clause
                           2.1.8 as have not already provided to the Lender.

                  2.2.2    NEW MANAGEMENT AGREEMENT A photocopy, certified as
                           true, accurate and complete by a director or the
                           secretary or the duly

                                       8
<PAGE>

                           authorised attorney of the Borrower of the New
                           Management Agreement.

                  2.2.3    NEW MANAGERS' CONFIRMATION The written confirmation
                           of the Managers that, throughout the Facility Period
                           unless otherwise agreed by the Lender, they will
                           remain the commercial and technical managers of the
                           Vessel and that they will not, without the prior
                           written consent of the Lender, sub-contract or
                           delegate the commercial or technical management of
                           the Vessel to any third party and confirming in terms
                           acceptable to the Lender that, following the
                           occurrence of an Event of Default, all claims of the
                           Managers against the Borrower shall be subordinated
                           to the claims of the Lender under the Finance
                           Documents.

                  2.2.4    REORGANISATION, OFFERING AND LISTING Evidence of the
                           Reorganisation, the Offering and the Listing.

         2.3      EVENT OF DEFAULT Failure of the Borrower to deliver any of the
                  documents or evidence listed in Clause 2.1 or Clause 2.2 in
                  accordance with the requirements thereof shall constitute an
                  Event of Default.

         2.4      All documents and evidence delivered to the Lender pursuant to
                  this Clause shall:

                  2.4.1    be in form and substance acceptable to the Lender;

                                       9
<PAGE>

                  2.4.2    be accompanied, if required by the Lender, by
                           translations into the English language, certified in
                           a manner acceptable to the Lender; and

                  2.4.3    if required by the Lender, be certified, notarised,
                           legalised or attested in a manner acceptable to the
                           Lender.

3        REPRESENTATIONS AND WARRANTIES

         Each of the representations and warranties contained in clauses 12 and
         13 of the Original Facility Agreement shall be deemed repeated by the
         Borrower at the date of this Supplemental Agreement and at the
         Effective Date, by reference to the facts and circumstances then
         pertaining, as if references in the Finance Documents to the Agreement
         included the Original Facility Agreement as supplemented and amended by
         this Supplemental Agreement.

4        AMENDMENTS TO ORIGINAL FACILITY AGREEMENT

         4.1      With effect from that Effective Date:-

                  4.1.1    The following additional definitions shall be added
                           in clause 1.1 of the Original Facility Agreement, and
                           the numerical order of the remaining definitions in
                           such Clause shall be amended accordingly:

                           "'ACCOUNTING INFORMATION' means the annual financial
                           statements and/or the quarterly financial statements
                           to be provided by the Corporate Guarantor to the
                           Lender in accordance with Clauses 13.1.1 and 13.1.4."

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

                                       10
<PAGE>

                           "'AVSTES AGREEMENT' means the reducing revolving
                           multi-currency credit facility agreement dated 17
                           April 2008 made between Avstes, as borrower and the
                           Lender, as lender, as amended and/or supplemented by
                           a supplemental agreement dated 22 May 2008 entered
                           into by and between Avstes and the Lender, and as the
                           same may be further amended and/or supplemented
                           and/or novated from time to time."

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

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

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

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

                           "'CONSOLIDATED GROUP LEVERAGE' means at any relevant
                           time Consolidated Total Liabilities divided by
                           Consolidated Total Assets."

                           "'CONSOLIDATED TOTAL ASSETS' means, at any date, the
                           aggregate of:

                           (a)      the then current market values of all
                                    vessels owned by any member of the Group (in
                                    the case of a Vessel or any other vessel,
                                    the market value shall be determined

                                    by reference only to the most recent
                                    valuation of such Vessel or vessel in
                                    accordance with Clause 11.11);

                                       11
<PAGE>

                           (b)      the then current aggregate amount of cash,
                                    Marketable Securities (but no other bonds,
                                    notes or bills and less any cash or
                                    Marketable Securities accounted for in the
                                    definition of Consolidated Total Liabilities
                                    below) and receivables due to the Group
                                    (less provision for bad and doubtful debts)
                                    as shown in the latest financial statements;
                                    and

                           (c)      the book values of all other assets (other
                                    than the assets referred to in
                                    sub-paragraphs (a) and (b) hereof) as shown
                                    in such latest financial statements."

                           "'CONSOLIDATED TOTAL LIABILITIES' means, at the
                           relevant date and for a particular period, the
                           aggregate of the consolidated Financial Indebtedness
                           of the Group shown in the latest consolidated
                           financial statements for the Group (excluding (i)
                           liabilities to its shareholders, provided that they
                           are subordinated on terms acceptable to the Lender in
                           its discretion and (ii) debt that is fully
                           collateralised by cash or Marketable Securities to
                           which the right of access, use or dealing is blocked
                           for any member of the Group solely to secure that
                           debt)."

                                       12
<PAGE>

                           "'CORPORATE GUARANTEE' means the guarantee and
                           indemnity referred to in Clause 11.1.4."

                           "'CORPORATE GUARANTOR' means Safe Bulkers."

                           "'CURRENT SHAREHOLDERS' means the shareholders of the
                           Corporate Guarantor who beneficially hold directly or
                           indirectly not less than fifty one per cent (51%) of
                           the shares in the Corporate Guarantor on the date of
                           the Listing." "'DEBT' means the aggregate (as of the
                           date of calculation) of all obligations of the Group
                           then outstanding for the payment or repayment of
                           Financial Indebtedness as stated in the Accounting
                           Information then most recently required to be
                           delivered pursuant to Clauses 13.1.1 and 13.1.4
                           including, without limitation:

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

                           (b)      any credit to the Group from a supplier of
                                    goods or under any instalment purchase or
                                    other similar arrangement;

                           (c)      the aggregate amount then outstanding of
                                    liabilities and obligations of third parties
                                    to the extent that they are guaranteed by
                                    the Group;

                                       13
<PAGE>

                           (d)      any contingent liabilities (including any
                                    taxes or other payments under dispute or
                                    arbitration) which have been or, under GAAP,
                                    should be recorded in the notes to the
                                    Group's financial statements; and

                           (e)      any deferred tax liabilities."

                           "'EBITDA' on a consolidated basis of the Group means
                           the earnings before interest, expenses and other
                           financial charges, taxes, depreciation and
                           amortization (for the previous period of twelve
                           months).

                           "'EFRAGEL GUARANTEES' means the guarantees and
                           indemnities to be granted by the Borrower in favour
                           of the Lender in respect of each of the Pelea
                           Indebtedness, the Marindou Indebtedness and the
                           Avstes Indebtedness and "EFRAGEL GUARANTEE" means any
                           one of them."

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

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

                           "'GROUP GUARANTEES' means the Marindou Guarantee, the
                           Pelea Guarantee and the Avstes Guarantee, and "GROUP
                           GUARANTEE" means any one of them."

                           "'GROUP GUARANTORS' means Marindou, Pelea and Avstes,
                           and "GROUP GUARANTOR" means any one of them."

                                       14
<PAGE>

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

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

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

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

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

                           "'MARINDOU AGREEMENT" means the reducing revolving
                           multi-currency credit facility agreement dated 11
                           January 2008 made between Marindou, as borrower and
                           the Lender, as lender, as amended and/or supplemented
                           by a supplemental agreement dated 22 May 2008 entered
                           into by and between Marindou and the Lender, and as
                           the same may be further amended and/or supplemented
                           and/or novated from time to time."

                           "'MARINDOU GUARANTEE' means the guarantee of Marindou
                           referred to in Clause 11.1.5."

                           "'MARINDOU INDEBTEDNESS' means the Indebtedness as
                           such term is defined in the Marindou Agreement."

                                       15
<PAGE>

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

                           "'NET WORTH' means Consolidated Total Assets less
                           Consolidated Total Liabilities."

                           "'NEW MANAGEMENT AGREEMENT' means the agreement for
                           the commercial and technical management of the Vessel
                           made or to be made between the Borrower and the
                           Managers."

                           "'NEW MANAGERS' CONFIRMATION' means a letter of
                           confirmation from the Managers in respect of the
                           Vessel and the Borrower."

                           "'OPERATING ACCOUNT CHARGE' means the deed of charge
                           referred to in Clause 11.1.8."

                           "'OWNER' means Owner A or Owner B, together the
                           "'OWNERS"."

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

                           "'OWNER B' means a single purpose ship-owning company
                           incorporated or to be incorporated in a jurisdiction
                           acceptable

                                       16
<PAGE>

                           to the Lender in its absolute discretion and which
                           shall be wholly owned legally and beneficially by the
                           Corporate Guarantor and which shall be the Owner of
                           Vessel B."

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

                           "'PELEA AGREEMENT' means the reducing revolving
                           multi-currency credit facility agreement dated 12
                           June 2007 made between Pelea, as borrower and the
                           Lender, as lender as amended and/or supplemented by a
                           supplemental agreement dated 22 May 2008 entered into
                           by and between Pelea and the Lender, and as the same
                           may be further amended and/or supplemented and/or
                           novated from time to time."

                           "'PELEA GUARANTEE' means the guarantee of Pelea
                           referred to in Clause 11.1.6."

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

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

                           "'SIDE LETTER' means the side letter evidencing the
                           Current Shareholders of the Corporate Guarantor on
                           the date of the

                                       17
<PAGE>

                           Listing issued by the Corporate Guarantor in favour
                           of the Lender in such form as the Lender may
                           require."

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

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

                           "'VESSEL A AGREEMENT' means the reducing revolving
                           multi-currency credit facility agreement to be
                           entered into by and between the Lender and Owner A
                           pursuant to which the Lender would advance to Owner A
                           an aggregate amount not exceeding forty five million
                           Dollars ($45,000,000) for the purpose of, inter alia,
                           financing part of the acquisition cost of Vessel A."

                           "'VESSEL A INDEBTEDNESS' means the Indebtedness as
                           such term is defined in the Vessel A Agreement."

                           "'VESSEL AGREEMENTS' means Vessel A Agreement and
                           Vessel B Agreement, "Vessel Agreement" means either
                           of them."

                                       18
<PAGE>

                           "'VESSEL B' means the dry-bulk carrier of
                           approximately 87,000 dwt, currently under
                           construction by the Builder with the Builder's hull
                           number 3254, to be named "ELENI" and intended to be
                           registered under a flag acceptable to the Lender in
                           its absolute discretion in the ownership of Owner B."

                           "'VESSEL B AGREEMENT' means the reducing revolving
                           multi-currency credit facility agreement to be
                           entered into by and between the Lender and Owner B
                           pursuant to which the Lender would advance to Owner B
                           an aggregate amount not exceeding forty five million
                           Dollars ($45,000,000) for the purpose of, inter alia,
                           financing part of the acquisition cost of Vessel B."

                           "'VESSEL B INDEBTEDNESS' means the Indebtedness as
                           such term is defined in the Vessel B Agreement."

                  4.1.2    The following definitions set out in clause 1.1 of
                           the Original Facility Agreement shall be deleted and
                           replaced by the following new respective
                           definitions:-

                           "'MANAGEMENT AGREEMENT' means the agreement(s) for
                           the commercial and/or technical management of the
                           Vessel between the Borrower and the Managers,
                           including, but not limited to, the New Management
                           Agreement."

                           "'OPERATING ACCOUNT' means the bank account opened in
                           the name of the Borrower with the Lender and
                           designated "Efragel

                                       19
<PAGE>

                           Shipping Corporation-Operating Account" with account
                           number 62555014."

                           "'RELEVANT DOCUMENTS' means the Finance Documents,
                           the Management Agreement, the Managers' confirmation
                           specified in Part I of Schedule 1 and the New
                           Managers' Confirmation."

                           "'SECURITY DOCUMENTS' means the Mortgage, the Deed of
                           Covenants, the Assignment, the Account Charge, the
                           Operating Account Charge, the Guarantees, any other
                           Credit Support Documents or (where the context
                           permits) any one or more of them and any other
                           agreement or document which may at any time be
                           executed by any person as security for the payment of
                           all or any part of the Indebtedness and "SECURITY
                           DOCUMENT" means any one of them."

                           "'SECURITY PARTIES' means the Borrower, the
                           Guarantors and any other Credit Support Provider and
                           any other person who may at any time during the
                           Facility Period be liable for, or provide security
                           for, all or any part of the Indebtedness, and
                           "SECURITY PARTY" means any one of them."

                  4.1.3    In clause 11.1.2 the word "and" at the end of the
                           sentence shall be deleted.

                  4.1.4    An additional clause 11.1.4 shall be added to the
                           Original Facility Agreement which shall be read and
                           construed as follows:-

                                       20
<PAGE>

                           "11.1.4 a guarantee and indemnity from the Corporate
                           Guarantor;"

                  4.1.5    An additional clause 11.1.5 shall be added to the
                           Original Facility Agreement which shall be read and
                           construed as follows:- "11.1.5 a guarantee and
                           indemnity from Marindou;"

                  4.1.6    An additional clause 11.1.6 shall be added to the
                           Original Facility Agreement which shall be read and
                           construed as follows:- "11.1.6 a guarantee and
                           indemnity from Pelea;"

                  4.1.7    An additional clause 11.1.7 shall be added to the
                           Original Facility Agreement which shall be read and
                           construed as follows:- "11.1.7 a guarantee and
                           indemnity from Avstes; and"

                  4.1.8    An additional clause 11.1.8 shall be added to the
                           Original Facility Agreement which shall be read and
                           construed as follows:-

                           "11.1.8 a first priority deed of charge over the
                           Operating Account and all amounts from time to time
                           standing to the credit of it."

                  4.1.9    Clause 12.1.14 of the Original Facility Agreement
                           shall be deleted and replaced by the following:-

                                       21
<PAGE>

                           "12.1.14 NO ESTABLISHED PLACE OF BUSINESS IN THE UK
                           OR US No Security Party, other than the Corporate
                           Guarantor, has an established place of business in
                           the United Kingdom or the United States of America."

                  4.1.10   Clause 13.1 of the Original Facility Agreement shall
                           be deleted and replaced by the following:-

                           "13.1    INFORMATION UNDERTAKINGS

                           13.1.1   FINANCIAL STATEMENTS The Borrower shall
                                    procure that the Corporate Guarantor
                                    supplies to the Lender as soon as the same
                                    become available, but in any event within
                                    one hundred and eighty (180) days after the
                                    end of each of its financial years, its
                                    audited consolidated financial statements
                                    for that financial year, together with a
                                    Compliance Certificate, signed by two
                                    directors of the Corporate Guarantor,
                                    setting out (in reasonable detail)
                                    computations as to compliance with Clause
                                    13.2.22 as at the date at which those
                                    financial statements were drawn up.

                           13.1.2   MANAGEMENT ACCOUNTS The Borrower or the
                                    Managers will supply to the Lender, on the
                                    Lender's request within sixty (60) days of
                                    the end of each calendar year during the
                                    Facility Period the

                                       22
<PAGE>

                                    unaudited management accounts for the Vessel
                                    prepared by the Managers showing the income
                                    and expenditure for the Vessel for such
                                    calendar year.

                           13.1.3   REQUIREMENTS AS TO FINANCIAL STATEMENTS Each
                                    set of financial statements delivered by the
                                    Borrower or the Corporate Guarantor (as
                                    applicable) under Clause 13.1.1 shall be:-

                                    (a)      prepared using GAAP; and

                                    (b)      certified by a director of the
                                             Corporate Guarantor as fairly
                                             representing its financial
                                             condition as at the date at which
                                             those financial statements were
                                             drawn up.

                           13.1.4   INTERIM FINANCIAL STATEMENTS The Borrower
                                    shall procure that the Corporate Guarantor
                                    supplies to the Lender as soon as the same
                                    become available, but in any event within
                                    ninety (90) days after the end of each
                                    quarter during each of the Corporate
                                    Guarantor's financial years, its unaudited
                                    consolidated quarterly financial statements
                                    for that quarter, together with a Compliance
                                    Certificate to be provided on a semi-annual
                                    basis, signed by two directors of the
                                    Corporate Guarantor, setting out (in
                                    reasonable detail) computations as to
                                    compliance

                                       23
<PAGE>

                                    with Clause 13.2.22 as at the date at which
                                    those financial statements were drawn up.

                           13.1.5   INFORMATION: MISCELLANEOUS The Borrower
                                    shall supply to the Lender:

                                    (a)      all documents dispatched by the
                                             Borrower to its shareholders (or
                                             any class of them) or its creditors
                                             generally at the same time as they
                                             are dispatched other than any
                                             documents that are subject to any
                                             confidentiality restrictions
                                             pursuant to the New York Stock
                                             Exchange regulations that may
                                             prohibit such dissemination;

                                    (b)      promptly upon becoming aware of
                                             them, details of any litigation,
                                             arbitration or administrative
                                             proceedings which are current,
                                             threatened or pending against any
                                             Security Party, and which might, if
                                             adversely determined, have a
                                             materially adverse effect on the
                                             business, assets, financial
                                             condition or credit worthiness of
                                             that Security Party; and

                                    (c)      promptly, such further information
                                             regarding the financial condition,
                                             business

                                       24
<PAGE>

                                             and operations of any Security
                                             Party as the Lender may reasonably
                                             request.

                           13.1.6   NOTIFICATION OF DEFAULT

                                    (a)      The Borrower shall notify the
                                             Lender of any Default (and the
                                             steps, if any, being taken to
                                             remedy it) promptly upon becoming
                                             aware of its occurrence.

                                    (b)      Promptly upon a request by the
                                             Lender, the Borrower shall supply
                                             to the Lender a certificate signed
                                             by two of its directors or senior
                                             officers on its behalf certifying
                                             that no Default is continuing (or
                                             if a Default is continuing,
                                             specifying the Default and the
                                             steps, if any, being taken to
                                             remedy it).

                           13.1.7   "KNOW YOUR CUSTOMER" CHECKS If:

                                    (a)      the introduction of or any change
                                             in (or in the interpretation,
                                             administration or application of)
                                             any law or regulation made after
                                             the date of this Agreement;

                                    (b)      any change in the status of the
                                             Borrower after the date of this
                                             Agreement; or

                                       25
<PAGE>

                                    (c)      a proposed assignment or transfer
                                             by the Lender of any of its rights
                                             and obligations under this
                                             Agreement,

                                    obliges the Lender (or, in the case of (c)
                                    above, any prospective new Lender) to comply
                                    with "know your customer" or similar
                                    identification procedures in circumstances
                                    where the necessary information is not
                                    already available to it, the Borrower shall
                                    promptly upon the request of the Lender
                                    supply, or procure the supply of, such
                                    documentation and other evidence as is
                                    reasonably requested by the Lender for
                                    itself (or, in the case of (c) above, on
                                    behalf of any prospective new Lender) in
                                    order for the Lender (or, in the case of (c)
                                    above, any prospective new Lender) to carry
                                    out and be satisfied it has complied with
                                    all necessary "know your customer" or other
                                    similar checks under all applicable laws and
                                    regulations pursuant to the transactions
                                    contemplated in the Finance Documents.

                  4.1.11   Clause 13.2.6 of the Original Facility Agreement
                           shall be deleted and replaced by the following:-

                                       26
<PAGE>

                           "13.2.6  NEGATIVE PLEDGE AND NO DISPOSALS Other than
                                    in favour of the Lender, the Borrower shall
                                    not create nor permit to subsist any
                                    Encumbrance or other third party rights over
                                    any of its present or future assets or
                                    undertaking nor dispose of any those assets
                                    or of all or part of that undertaking."

                  4.1.12   Clause 13.2.7 of the Original Facility Agreement
                           shall be deleted and replaced by the following:-

                           "13.2.7  MERGER The Borrower shall not without the
                                    prior written consent of the Lender enter
                                    into any amalgamation, demerger, merger or
                                    corporate reconstruction other than the
                                    Reorganization."

                  4.1.13   Clause 13.2.12 of the Original Facility Agreement
                           shall be deleted and replaced by the following:-

                           "13.2.12 NO SUBSTANTIAL LIABILITIES Except in the
                                    ordinary course of business and other than
                                    in favour of the Lender, the Borrower shall
                                    not without the prior written consent of the
                                    Lender incur any liability to any third
                                    party which is in the Lender's opinion of a
                                    substantial nature."

                  4.1.14   Clause 13.2.13 of the Original Facility Agreement
                           shall be deleted and replaced by the following:-

                                       27
<PAGE>

                           "13.2.13 NO LOANS OR OTHER FINANCIAL COMMITMENTS The
                                    Borrower shall not without the prior written
                                    consent of the Lender make any loan nor
                                    enter into any guarantee or indemnity (other
                                    than the Efragel Guarantees, other than any
                                    guarantee or indemnity from time to time
                                    required by any insurer and which is in
                                    accordance with the terms and conditions of
                                    clause 5 of the Deed of Covenants, the
                                    Insurances and any acceptable Insurance
                                    letter of undertaking) or otherwise
                                    voluntarily assume any actual or contingent
                                    liability in respect of any obligation of
                                    any other person."

                  4.1.15   Clause 13.2.14 of the Original Facility Agreement
                           shall be deleted.

                  4.1.16   Clause 13.2.15 of the Original Facility Agreement
                           shall be deleted and replaced by the following:-

                           "13.2.15 INSPECTION OF RECORDS The Borrower will
                                    permit the inspection of its financial
                                    records and accounts and procure that the
                                    Corporate Guarantor permits the inspection
                                    of the Corporate Guarantor's financial
                                    records and accounts from time to time by
                                    the Lender or its nominee."

                                       28
<PAGE>

                  4.1.17   Clause 13.2.17 of the Original Facility Agreement
                           shall be deleted and replaced by the following:-

                           "13.2.17 NO CHANGE IN OWNERSHIP OR CONTROL OF THE
                                    BORROWER OF THE MANAGERS The Borrower shall
                                    not cease to be a wholly owned Subsidiary of
                                    the Corporate Guarantor and shall not permit
                                    any change in the beneficial ownership and
                                    control of the Managers from that advised to
                                    the Lender on the date of the Listing."

                  4.1.18   An additional clause 13.2.20 shall be added to the
                           Original Facility Agreement which shall be read and
                           construed as follows:-

                           "13.2.20 OWNERSHIP The Borrower shall procure that
                                    the Corporate Guarantor shall remain
                                    directly or indirectly beneficially owned by
                                    its Current Shareholders or any of them at a
                                    minimum of fifty one per cent (51%)."

                  4.1.19   An additional clause 13.2.21 shall be added to the
                           Original Facility Agreement which shall be read and
                           construed as follows:-

                           "13.2.21 GUARANTEES AND INDEMNITIES The Borrower
                                    shall by not later than the execution date
                                    of the Vessel Agreements execute in favour
                                    of the Lender

                                       29
<PAGE>

                                    guarantees and indemnities in such forms and
                                    containing such terms and conditions as the
                                    Lender shall in its discretion require and
                                    which shall secure the Vessel A Indebtedness
                                    and the Vessel B Indebtedness, and shall
                                    procure that each Owner shall by not later
                                    than the execution date of the relevant
                                    Vessel Agreement grant in favour of the
                                    Lender a guarantee and indemnity in such
                                    form and containing such terms and
                                    conditions as the Lender shall in its
                                    discretion require and which shall secure
                                    the Indebtedness."

                  4.1.20   An additional clause 13.2.22 shall be added to the
                           Original Facility Agreement which shall be read and
                           construed as follows:-

                           "13.2.22 FINANCIAL COVENANTS The Borrower shall
                                    procure that the Corporate Guarantor shall
                                    on a consolidated basis comply with the
                                    following financial covenants to be assessed
                                    on a semi-annual basis based on the
                                    Accounting Information received by the
                                    Lender in accordance with Clauses 13.1.1 and
                                    13.1.4:-

                                    (a)      CONSOLIDATED GROUP LEVERAGE The
                                             Consolidated Group Leverage shall
                                             be equal to or less than seventy
                                             per cent (70%).

                                       30
<PAGE>

                                    (b)      DEBT TO EBITDA RATIO The ratio of
                                             Debt to EBITDA on a trailing twelve
                                             (12) month's basis shall not at any
                                             time exceed 5.5:1.

                                    (c)      NET WORTH The Net Worth shall not
                                             at any time be less than one
                                             hundred and seventy five million
                                             Dollars ($175,000,000)."

                  4.1.21   Clause 14.1.8 of the Original Facility Agreement
                           shall be deleted and replaced by the following:-

                           "14.1.8  CHANGE IN OWNERSHIP OR CONTROL OF THE
                                    BORROWER OR THE MANAGERS The Borrower ceases
                                    to be a wholly owned Subsidiary of the
                                    Corporate Guarantor or there is any change
                                    in the beneficial ownership or control of
                                    the Borrower or the Managers from that
                                    advised to the Lender by the Borrower on the
                                    date of the Listing."

                  4.1.22   Clause 14.1.14 of the Original Facility Agreement
                           shall be deleted and replaced by the following:-

                           "14.1.14 REDUCTION OF CAPITAL A Security Party (other
                                    than the Corporate Guarantor) reduces its
                                    authorised or issued or subscribed capital."

                  4.1.23   An additional clause 14.1.20 shall be added to the
                           Original Facility Agreement which shall be read and
                           construed as follows:-

                                       31
<PAGE>

                           "14.1.20 NOTICE OF TERMINATION Any of the Guarantors
                                    gives notice to the Lender to determine its
                                    obligations under the relevant Guarantee."

                  4.1.24   Clause 22.5 of the Original Facility Agreement shall
                           be deleted and replaced by the following:-

                           "22.5    SERVICE OF PROCESS Without prejudice to any
                                    other mode of service allowed under any
                                    relevant law, each Security Party:

                                    22.5.1   irrevocably appoints Mr. Savvas
                                             Savvides, 24 Exeter Road, London
                                             N14 5JY, England (tel/fax: +44 208
                                             361 2606) as its agent for service
                                             of process in relation to any
                                             proceedings before the English
                                             courts in connection with this
                                             Agreement; and

                                    22.5.2   agrees that failure by a process
                                             agent to notify the relevant
                                             Security Party of the process will
                                             not invalidate the proceedings
                                             concerned."

                  4.1.25   All references to "this Agreement" shall be
                           references to the Original Facility Agreement as
                           amended and/or supplemented by this Supplemental
                           Agreement.

                                       32
<PAGE>

                  4.1.26   The Schedule to this Supplemental Agreement shall be
                           incorporated as "Schedule 4" to the Original Facility
                           Agreement.

                  4.1.27   All references in the Security Documents to the
                           Agreement (however it may be defined) shall be read
                           and construed as the Original Facility Agreement as
                           supplemented and amended hereby.

                  4.1.28   All references to the "Security Documents" shall be
                           shall be read and construed to include the Guarantees
                           and the Operating Account Charge.

         All other terms and conditions of the Original Facility Agreement shall
         remain unaltered and in full force and effect.

5        CONFIRMATION AND UNDERTAKING

         5.1      Each of the Security Parties confirms that all of its
                  respective obligations under or pursuant to each of the
                  Security Documents to which it is a party remain in full force
                  and effect, despite the amendments to the Original Facility
                  Agreement made in this Supplemental Agreement, as if all
                  references in any of the Security Documents to the Facility
                  Agreement (however described) were references to the Original
                  Facility Agreement as amended and supplemented by this
                  Supplemental Agreement.

         5.2      The definition of any term defined in any of the Security
                  Documents shall, to the extent necessary, be modified to
                  reflect the amendments to the Original Facility Agreement made
                  in this Supplemental Agreement.

                                       33
<PAGE>

6        COMMUNICATIONS, LAW AND JURISDICTION

         The provisions of clauses 18 and 22 of the Original Facility Agreement
         shall apply to this Supplemental Agreement as if they were set out in
         full and as if references to the Facility Agreement were references to
         this Supplemental Agreement and references to the Borrower were
         references to the Security Parties.

                                       34
<PAGE>

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

SIGNED AND DELIVERED AS      )
A DEED BY                    )
EFRAGEL SHIPPING CORPORATION )            /s/ Ioannis Foteinos
acting by IOANNIS FOTEINOS   )
its duly authorised attorney-)
in-fact in the presence of:  )

SIGNED AND DELIVERED AS
A DEED BY
DNB NOR BANK ASA                         /s/ Sofia Tzanaki
acting by SOFIA TZANAKI
its duly authorised attorney-
in-fact  in  the  presence of:
FADIL NEKLEZADE

                               STEPHENSON HARWOOD
                                ARISTON BUILDING
                        2 FILELLINON STR. & AKTI MIAOULI
                                 PIRAEUS 185 36
                           VAT. NO. 9 9 8 7 1 1 1 5 6
                                TEL 210 42 95 160

                                       35
<PAGE>

                                    SCHEDULE

                         FORM OF COMPLIANCE CERTIFICATE

To:      DNB NOR BANK ASA

From:    SAFE BULKERS INC.

Dated:

Dear Sirs

EFRAGEL SHIPPING CORPORATION - US$42,000,000 REDUCING REVOLVING MULTI-CURRENCY
CREDIT FACILITY AGREEMENT DATED 11 JANUARY 2008 AS AMENDED, SUPPLEMENTED,
NOVATED AND/OR REPLACED FROM TIME TO TIME (THE "AGREEMENT")

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

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

We confirm that:

Agreement                  Covenant determination/
 Clause                     Calculation compliance          (MIN/MAX AMOUNT)

13.2.23(a) CONSOLIDATED GROUP LEVERAGE

           Consolidated Total Liabilities USD[     ]
           / Consolidated Total Assets    USD[      ]
           = Consolidated Group Leverage  [     %]         [maximum 70%]

13.2.23(b) DEBT TO EBITDA RATIO

           Debt                           USD[     ]
           / EBITDA                       USD[     ]
           = Debt to EBITDA ratio         [     ]          [maximum 5.5:1]

13.2.23(c) NET WORTH

           Consolidated Total Assets      USD[     ]
           (minus) Consolidated Total Liabilities USD[     ]
            = Net Worth                   [     %]         [min. USD175,000,000]

                                       36
<PAGE>

[We confirm that no Default is continuing.]*

Signed:     ___________________________         ___________________________

            Director                            Director

            of                                  of

            SAFE BULKERS INC.                   SAFE BULKERS INC.

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

                                       37Exhibit 10.40

DATED 22 MAY 2008

AVSTES SHIPPING CORPORATION 

(as borrower)

-and

DnB NOR BANK ASA

(as lender)

______________________________________________________________

FIRST SUPPLEMENTAL AGREEMENT TO A SECURED

REDUCING REVOLVING MULTI-CURRENCY CREDIT FACILITY AGREEMENT

DATED 17 APRIL 2008

______________________________________________________________

STEPHENSON HARWOOD

One, St. Paul’s Churchyard

London EC4M 8SH

Tel: 020 7329 4422

Fax: 020 7329 7100

Ref: 04.138

 

 

 

 

 

CONTENTS

	
       
 	
       
 	
      Page

 
	
                        1.    Interpretation
 	
                         
 	
                        2
 
	
                        2.    Conditions
 	
                         
 	
                        4
 
	
                        3.    Representations and Warranties
 	
                         
 	
                        6
 
	
                        4.    Amendments to Original Facility Agreement
 	
                         
 	
                        7
 
	
                        5.    Confirmation and Undertaking
 	
                         
 	
                        22
 
	
                        6.    Communications, Law and Jurisdiction
 	
                         
 	
                        22
 
	 	 	 
	
                        SCHEDULE 1: Form of Compliance Certificate
 	
                         
 	
  24
 

 

 

 

 

 

SUPPLEMENTAL AGREEMENT

Dated:  22 MAY 2008

BETWEEN:

	
                        (1)
 	
                        AVSTES SHIPPING CORPORATION, a company incorporated under the laws of the Republic of Liberia whose registered office is at 80 Broad Street, Monrovia, Liberia (the “Borrower”); and
 

	
                        (2)
 	
                        DnB NOR BANK ASA, acting through its office at 20 St. Dunstan’s Hill, London EC3R 8HY, England (the “Lender”).
 

SUPPLEMENTAL TO a secured reducing revolving multi-currency credit facility agreement dated 17 April 2008 (the “Original Facility Agreement”) made between the Borrower and the Lender, on the terms and subject to the conditions of which the Lender agreed to advance to the Borrower an aggregate amount not exceeding thirty six million Dollars ($36,000,000) (the “Loan”).

WHEREAS:

	
                        (A)
 	
                        The Borrower has informed the Lender that it wishes to enter into a series of transactions (the “Reorganization”) as a result of which: (a) its shares will cease to be wholly owned by its present shareholders; (b) the Corporate Guarantor will own 100% of the Borrower’s shares; and (c) its ownership structure will change following the initial public offering of the common stock of the Corporate Guarantor in the New York Stock Exchange (the “Offering”).
 

	
                        (B)
 	
                        The Borrower has requested the Lender to proceed in amending, inter alia, clauses 13.2.17 and 14.1.8 of the Original Facility Agreement, which would otherwise be breached upon the occurrence of the Reorganization and the Offering, and to delete, inter alia, clause 13.2.14 and to amend, inter alia, clauses 13.2.13 and 13.2.20 of the Original Facility Agreement.
 

	
                        (C)
 	
                        The Lender is willing to accede to such requests as listed in Recital (B) above and has agreed to amend the Original Facility Agreement and the Security Documents (as applicable) on the terms and subject to the conditions contained in this Supplemental Agreement.
 

 

 

 

 

 

IT IS AGREED THAT:

	
                        1
 	
                        Interpretation
 

	
                         
 	
                        1.1
 	
                        In this Supplemental Agreement
 

	
                         
 	
                        1.1.1
 	
                        “Additional Documents” means the Supplemental Agreement, the Guarantees and the Operating Account Charge.
 

	
                         
 	
                        1.1.2
 	
                        “Corporate Guarantee” means the guarantee and indemnity to be granted by the Corporate Guarantor in favour of the Lender.
 

	
                         
 	
                        1.1.3
 	
                        “Corporate Guarantor” means Safe Bulkers Inc., a company incorporated according to the laws of the Republic of Marshall Islands or such other company which shall be its successor in title.
 

	
                         
 	
                        1.1.4
 	
                        “Effective Date” means the date of the Listing, such date falling no later than 30 August 2008.
 

	
                         
 	
                        1.1.5
 	
                        “Efragel” means Efragel Shipping Corporation, a company incorporated according to the laws of the Republic of Liberia or such other company which shall be its successor in title.
 

	
                         
 	
                        1.1.6
 	
                        “Efragel Guarantee” means the guarantee and indemnity granted by Efragel in respect of the Indebtedness in favour of the Lender, in such form and containing such terms and conditions as the Lender shall require.
 

	
                         
 	
                        1.1.7
 	
                        “Group Guarantees” means the Efragel Guarantee, the Pelea Guarantee and the Marindou Guarantee, and “Group Guarantee” means any one of them.
 

	
                         
 	
                        1.1.8
 	
                        “Group Guarantor” means any one of Efragel, Pelea or Marindou, and “Group Guarantors” means more than one of them.
 

	
                         
 	
                        1.1.9
 	
                        “Guarantees” means the Group Guarantees and the Corporate Guarantee and “Guarantee” means any one of them.
 

	
                         
 	
                        1.1.10
 	
                        “Guarantors” means the Group Guarantors and the Corporate Guarantor and “Guarantor” means any one of them.
 

 

 

2

 

 

	
                         
 	
                        1.1.11
 	
                        “Listing” means the effective trading date of the shares of the Corporate Guarantor listed on the New York Stock Exchange.
 

	
                         
 	
                        1.1.12
 	
                        “Marindou” means Marindou Shipping Corporation, a company incorporated according to the laws of the Republic of Liberia or such other company which shall be its successor in title.
 

	
                         
 	
                        1.1.13
 	
                        “Marindou Guarantee” means the guarantee and indemnity granted by Marindou in respect of the Indebtedness in favour of the Lender, in such form and containing such terms and conditions as the Lender shall require.
 

	
                         
 	
                        1.1.14
 	
                        “Operating Account Charge” means the first priority deed of charge over the Operating Account to be executed by the Borrower in favour of the Lender.
 

	
                         
 	
                        1.1.15
 	
                        “Pelea” means Pelea Shipping Ltd., a company incorporated according to the laws of the Republic of Liberia or such other company which shall be its successor in title.
 

	
                         
 	
                        1.1.16
 	
                        “Pelea Guarantee” means the guarantee and indemnity granted by Pelea in respect of the Indebtedness in favour of the Lender, in such form and containing such terms and conditions as the Lender shall require.
 

	
                         
 	
                        1.1.17
 	
                        “Side Letter” means a side letter evidencing the Current Shareholders of the Corporate Guarantor on the date of the Listing issued by the Corporate Guarantor in favour of the Lender in such form as the Lender may require.
 

	
                         
 	
                        1.1.18
 	
                        “Supplemental Agreement” means this Supplemental Agreement.
 

	
                         
 	
                        1.2
 	
                        All words and expressions defined in the Original Facility Agreement and in Clause 4 of this Supplemental Agreement shall have the same meaning when used in this Supplemental Agreement unless the context otherwise requires, and clause 1.2 of the Original Facility Agreement shall apply to the interpretation of this Supplemental Agreement as if it were set out in full.
 

 

 

3

 

 

 

	
                        2
 	
                        Conditions
 

	
                         
 	
                        2.1
 	
                        Conditions Subsequent - Initial  The Borrower shall deliver or cause to be delivered to or to the order of the Lender within five (5) Business Days from the Effective Date the following documents and evidence:
 

	
                         
 	
                        2.1.1
 	
                        Borrower’s officer’s certificate A certificate from a duly authorised officer of the Borrower confirming that none of the documents delivered to the Lender pursuant to Schedule 1 Part I (a), (c) and (e) of the Original Facility Agreement have been amended or modified in any way since the date of their delivery to the Lender, or copies, certified by a duly authorised officer of the Borrower as true, complete, accurate and neither amended nor revoked, of any which have been amended or modified.
 

	
                         
 	
                        2.1.2
 	
                        Borrower’s and Guarantors’ officer’s certificates A certificate of a duly authorised officer of the Borrower and each Guarantor certifying that each copy document relating to it specified in Clauses 2.1.3 (other than in respect of the Borrower) to 2.1.6 is correct, complete and in full force and effect as at a date no earlier than five days prior to the date of this Supplemental Agreement and setting out the names of the directors and officers of the Borrower and the respective Guarantor.
 

	
                         
 	
                        2.1.3
 	
                        Constitutional Documents Copies of the constitutional documents of each Guarantor together with such other evidence as the Lender may reasonably require that the Guarantor in question is duly incorporated in its country of incorporation and remains in existence with power to enter into, and perform its obligations under, the relevant Guarantee.
 

	
                         
 	
                        2.1.4
 	
                        Resolutions A copy, certified by a director or the secretary of the Security Party in question as true, complete and accurate and neither amended nor revoked, of a resolution of the directors and, a resolution of the shareholders of each Security Party (together, where appropriate, with signed waivers of notice of any directors or shareholders meetings) approving, and authorising or ratifying the execution of, this Supplemental Agreement and any document to be executed by that Security Party pursuant to this Supplemental Agreement.
 

 

4

 

 

 

	
                         
 	
                        2.1.5
 	
                        Powers of Attorney A notarially attested and legalised power of attorney of each of the Security Parties (other than the Corporate Guarantor) and a duly executed power of attorney in respect of the Corporate Guarantor under which this Supplemental Agreement and any documents required pursuant to it are to be executed by that Security Party.
 

	
                         
 	
                        2.1.6
 	
                        Certificates of good standing A certificate of good standing in respect of each Security Party (if such a certificate can be obtained).
 

	
                         
 	
                        2.1.7
 	
                        Additional Documents The Additional Documents duly executed by all parties thereto.
 

	
                         
 	
                        2.1.8
 	
                        Legal Opinions A legal opinion of the legal advisers of the Lender in the relevant jurisdiction, substantially in the form or forms provided to the Lender prior to signing of this Supplemental Agreement or confirmation satisfactory to the Lender that such a legal opinion will be given.
 

	
                         
 	
                        2.1.9
 	
                        Other authorisations A copy of any other consent, licence, approval, authorisation or other document, opinion or assurance which the Lender considers to be necessary or desirable (if it has notified the Security Parties accordingly) in connection with the entry into and performance of the transactions contemplated by any of the Additional Documents or for the validity and enforceability of any of the Additional Documents.
 

	
                         
 	
                        2.1.10
 	
                        Side Letter The side letter evidencing the Current Shareholders of the Corporate Guarantor issued by the Corporate Guarantor in favour of the Lender in such form as the Lender may require.
 

	
                         
 	
                        2.1.11
 	
                        Process agent Evidence that any process agent referred to in Clause 22.5 of the Agreement and any process agent appointed under any other Finance Document has accepted its appointment.
 

	
                         
 	
                        2.2
 	
                        Conditions Subsequent -Additional The Borrower shall deliver or cause to be delivered to or to the order of the Lender within thirty (30) days from the Effective Date, the following documents and evidence:-
 

 

5

 

 

 

	
                         
 	
                        2.2.1
 	
                        Legal opinions The legal opinions specified in Clause 2.1.8 as have not already provided to the Lender.
 

	
                         
 	
                        2.2.2
 	
                        New Management Agreement A photocopy, certified as true, accurate and complete by a director or the secretary or the duly authorised attorney of the Borrower of the New Management Agreement.
 

	
                         
 	
                        2.2.3
 	
                        New Managers’ confirmation The written confirmation of the Managers that, throughout the Facility Period unless otherwise agreed by the Lender, they will remain the commercial and technical managers of the Vessel and that they will not, without the prior written consent of the Lender, sub-contract or delegate the commercial or technical management of the Vessel to any third party and confirming in terms acceptable to the Lender that, following the occurrence of an Event of Default, all claims of the Managers against the Borrower shall be subordinated to the claims of the Lender under the Finance Documents.
 

	
                         
 	
                        2.2.4
 	
                        Reorganisation, Offering and Listing Evidence of the Reorganisation, the Offering and the Listing.
 

	
                         
 	
                        2.3
 	
                        Event of Default Failure of the Borrower to deliver any of the documents or evidence listed in Clause 2.1. or Clause 2.2 in accordance with the requirements thereof shall constitute an Event of Default.
 

	
                         
 	
                        2.4
 	
                        All documents and evidence delivered to the Lender pursuant to this Clause shall:
 

	
                         
 	
                        2.4.1
 	
                        be in form and substance acceptable to the Lender;
 

	
                         
 	
                        2.4.2
 	
                        be accompanied, if required by the Lender, by translations into the English language, certified in a manner acceptable to the Lender; and
 

	
                         
 	
                        2.4.3
 	
                        if required by the Lender, be certified, notarised, legalised or attested in a manner acceptable to the Lender.
 

	
                        3
 	
                        Representations and Warranties
 

Each of the representations and warranties contained in clauses 12 and 13 of the Original Facility Agreement shall be deemed repeated by the Borrower at the date of this Supplemental Agreement and at the Effective Date, by reference to the facts and circumstances then pertaining, as if references in the Finance Documents to the Agreement included the Original Facility Agreement as supplemented and amended by this Supplemental Agreement.

 

6

 

 

 

	
                        4
 	
                        Amendments to Original Facility Agreement
 

	
                         
 	
                        4.1
 	
                        With effect from that Effective Date:-
 

	
                         
 	
                        4.1.1
 	
                        The following additional definitions shall be added in clause 1.1 of the Original Facility Agreement, and the numerical order of the remaining definitions in such Clause shall be amended accordingly:
 

“‘Accounting Information’ means the annual financial statements and/or the quarterly financial statements to be provided by the Corporate Guarantor to the Lender in accordance with Clauses 13.1.1 and 13.1.4 respectively.”

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

“‘Builder’ means IHI Amtec Co. of Tokyo, Japan.”

“‘Compliance Certificate’ means a certificate substantially in the form set out in Schedule 4 in form and substance satisfactory to the Lender.”

“‘Consolidated Group Leverage’ means at any relevant time Consolidated Total Liabilities divided by Consolidated Total Assets.”

“‘Consolidated Total Assets’ means, at any date, the aggregate of:

	
                         
 	
                        (a)
 	
                        the then current market values of all vessels owned by any member of the Group (in the case of a Vessel or any other vessel, the market value shall be determined by reference only to the most recent valuation of such Vessel or vessel in accordance with Clause 11.11);
 

 

7

 

 

 

	
                         
 	
                        (b)
 	
                        the then current aggregate amount of cash, Marketable Securities (but no other bonds, notes or bills and less any cash or Marketable Securities accounted for in the definition of Consolidated Total Liabilities below) and receivables due to the Group (less provision for bad and doubtful debts) as shown in the latest financial statements; and
 

	
                         
 	
                        (c)
 	
                        the book values of all other assets (other than the assets referred to in sub-paragraphs (a) and (b) hereof) as shown in such latest financial statements.”
 

“‘Consolidated Total Liabilities’ means, at the relevant date and for a particular period, the aggregate of the consolidated Financial Indebtedness of the Group shown in the latest consolidated financial statements for the Group (excluding (i) liabilities to its shareholders, provided that they are subordinated on terms acceptable to the Lender in its discretion and (ii) debt that is fully collateralised by cash or Marketable Securities to which the right of access, use or dealing is blocked for any member of the Group solely to secure that debt).”

“‘Corporate Guarantee’ means the guarantee and indemnity referred to in Clause 11.1.4”

“‘Corporate Guarantor’ means Safe Bulkers.”

“‘Current Shareholders’ means the shareholders of the Corporate Guarantor who beneficially hold directly or indirectly not less than fifty one per cent (51%) of the shares in the Corporate Guarantor on the date of the Listing.”

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

 

8

 

 

 

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

	
                         
 	
                        (b)
 	
                        any credit to the Group from a supplier of goods or under any instalment purchase or other similar arrangement;
 

	
                         
 	
                        (c)
 	
                        the aggregate amount then outstanding of liabilities and obligations of third parties to the extent that they are guaranteed by the Group;
 

	
                         
 	
                        (d)
 	
                        any contingent liabilities (including any taxes or other payments under dispute or arbitration) which have been or, under GAAP, should be recorded in the notes to the Group’s financial statements; and
 

	
                         
 	
                        (e)
 	
                        any deferred tax liabilities.”
 

“‘EBITDA’ on a consolidated basis of the Group means the earnings before interest, expenses and other financial charges, taxes, depreciation and amortization (for the previous period of twelve months).”

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

“‘Efragel Agreement’ means the reducing revolving multi-currency credit facility agreement dated 11 January 2008 made between Efragel, as borrower and the Lender, as lender, as amended and/or supplemented by a supplemental agreement dated 22 May 2008 entered into by and between Efragel and the Lender, and as the same may be further amended and/or supplemented and/or novated from time to time.”

“‘Efragel Guarantee’ means the guarantee of Efragel referred to in Clause 11.1.5.”

“‘Efragel Indebtedness’ means the Indebtedness as such term is defined in the Efragel Agreement.”

 

9

 

 

 

“‘GAAP’ means generally accepted accounting principles in the United States of America.”

“‘Group’ means the Corporate Guarantor and its Subsidiaries.”

“‘Group Guarantees’ means the Efragel Guarantee, the Pelea Guarantee and the Marindou Guarantee, and “Group Guarantee” means any one of them.”

“‘Group Guarantors’ means Efragel, Pelea and Marindou, and “Group Guarantor” means any one of them.”

“‘Guarantees’ means the Corporate Guarantee and the Group Guarantees and 

“‘Guarantee’ means any one of them.”

“‘Guarantors’ means the Corporate Guarantor and the Group Guarantors, and “Guarantor” means any one of them.”

“‘Listing’ means the effective trading date of the shares of the Corporate Guarantor listed on the New York Stock Exchange.”

“‘Marindou’ means Marindou Shipping Corporation, a company incorporated according to the laws of the Republic of Liberia or such other company which shall be its successor in title.”

“‘Marindou Agreement’ means the reducing revolving multi-currency credit facility agreement dated 11 January 2008 made between Marindou, as borrower and the Lender, as lender, as amended and/or supplemented by a supplemental agreement dated 22 May 2008 entered into by and between Marindou and the Lender, and as the same may be further amended and/or supplemented and/or novated from time to time.”

“‘Marindou Guarantee’ means the guarantee of Marindou referred to in Clause 11.1.7.”

“‘Marindou Indebtedness’ means the Indebtedness as such term is defined in the Marindou Agreement.”

 

10

 

 

 

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

“‘Net Worth’ means Consolidated Total Assets less Consolidated Total Liabilities.”

“‘New Management Agreement’ means the agreement for the commercial and technical management of the Vessel made or to be made between the Borrower and the Managers.”

“‘New Managers’ Confirmation’ means a letter of confirmation from the Managers in respect of the Vessel and the Borrower.”

“‘Operating Account Charge’ means the deed of charge referred to in Clause 11.1.8.”

“‘Owner’ means Owner A or Owner B, together the “Owners”.

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

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

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

“‘Pelea Agreement’ means the reducing revolving multi-currency credit facility agreement dated 12 June 2007 made between Pelea, as borrower and the Lender, as lender as amended and/or supplemented by a supplemental agreement dated 22 May 2008 entered into by and between Pelea and the Lender, and as the same may be further amended and/or supplemented and/or novated from time to time.”

 

11

 

 

 

“‘Pelea Guarantee’ means the guarantee of Pelea referred to in Clause 11.1.6.”

“‘Pelea Indebtedness’ means the Indebtedness as such term is defined in the Pelea Agreement.”

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

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

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

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

“‘Vessel A Agreement’ means the reducing revolving multi-currency credit facility agreement to be entered into by and between the Lender and Owner A pursuant to which the Lender would advance to Owner A an aggregate amount not exceeding forty five million Dollars ($45,000,000) for the purpose of, inter alia, financing part of the acquisition cost of Vessel A.”

“‘Vessel A Indebtedness’ means the Indebtedness as such term is defined in the Vessel A Agreement.”

“‘Vessel Agreements’ means Vessel A Agreement and Vessel B Agreement, “Vessel Agreement” means either of them.

 

12

 

 

 

“‘Vessel B’ means the dry-bulk carrier of approximately 87,000 dwt, currently under construction by the Builder with the Builder’s hull number 3254, to be named “ELENI” and intended to be registered under a flag acceptable to the Lender in its absolute discretion in the ownership of Owner B.”

“‘Vessel B Agreement’ means the reducing revolving multi-currency credit facility agreement to be entered into by and between the Lender and Owner B pursuant to which the Lender would advance to Owner B an aggregate amount not exceeding forty five million Dollars ($45,000,000) for the purpose of, inter alia, financing part of the acquisition cost of Vessel B.”

‘“Vessel B Indebtedness’ means the Indebtedness as such term is defined in the Vessel B Agreement.”

	
                         
 	
                        4.1.2
 	
                        The following definitions set out in clause 1.1 of the Original Facility Agreement shall be deleted and replaced by the following new respective definitions:-
 

“‘Charters’ means the Existing Charters and any other time charter or other contact of employment in respect of the Vessel to be entered into by and between the Borrower and a Charterer and “Charter” means any of them.”

“‘Management Agreement’ means the agreement(s) for the commercial and/or technical management of the Vessel between the Borrower and the Managers, including, but not limited to, the New Management Agreement.”

“‘Operating Account’ means the bank account opened in the name of the Borrower with the Lender and designated “Avstes Shipping Corporation—Operating Account” with account number 63628006.”

“‘Relevant Documents’ means the Finance Documents, the Management Agreement, the Managers confirmation specified in Part I of Schedule 1 and the New Managers Confirmation.”

 

13

 

 

 

“‘Security Documents’ means the Mortgage, the Deed of Covenants, the Assignment, the Account Charge, the Operating Account Charge, the Guarantees, any other Credit Support Documents or (where the context permits) any one or more of them and any other agreement or document which may at any time be executed by any person as security for the payment of all or any part of the Indebtedness and “Security Document” means any one of them.”

“‘Security Parties’ means the Borrower, the Guarantors and any other Credit Support Provider and any other person who may at any time during the Facility Period be liable for, or provide security for, all or any part of the Indebtedness, and “Security Party” means any one of them.”

	
                         
 	
                        4.1.3
 	
                        In clause 11.1.2 of the Original Facility Agreement the word “and” at the end of the sentence shall be deleted.
 

	
                         
 	
                        4.1.4
 	
                        In clause 11.1.3 of the Original Facility Agreement the word “and” at the end of the sentence shall be added.
 

	
                         
 	
                        4.1.5
 	
                        An additional clause 11.1.4 shall be added to the Original Facility Agreement which shall be read and construed as follows:-
 

“11.1.4 a guarantee and indemnity from the Corporate Guarantor;”

	
                         
 	
                        4.1.6
 	
                        An additional clause 11.1.5 shall be added to the Original Facility Agreement which shall be read and construed as follows:-
 

“11.1.5 a guarantee and indemnity from Efragel;”

	
                         
 	
                        4.1.7
 	
                        An additional clause 11.1.6 shall be added to the Original Facility Agreement which shall be read and construed as follows:-
 

“11.1.6 a guarantee and indemnity from Pelea;”

	
                         
 	
                        4.1.8
 	
                        An additional clause 11.1.7 shall be added to the Original Facility Agreement which shall be read and construed as follows:-
 

“11.1.7 a guarantee and indemnity from Marindou; and”

 

14

 

 

 

	
                         
 	
                        4.1.9
 	
                        An additional clause 11.1.8 shall be added to the Original Facility Agreement which shall be read and construed as follows:-
 

“11.1.8 a first priority deed of charge over the Operating Account and all amounts from time to time standing to the credit of it.”

	
                         
 	
                        4.1.10
 	
                        Clause 12.1.14 of the Original Facility Agreement shall be deleted and replaced by the following:-
 

“12.1.14 No established place of business in the UK or US No Security Party, other than the Corporate Guarantor, has an established place of business in the United Kingdom or the United States of America.”

	
                         
 	
                        4.1.11
 	
                        Clause 13.1 of the Original Facility Agreement shall be deleted and replaced by the following:-
 

	
                         
 	
                        “13. 1
 	
                        Information Undertakings
 

	
                         
 	
                        13.1.1
 	
                        Financial statements The Borrower shall procure that the Corporate Guarantor supplies to the Lender as soon as the same become available, but in any event within one hundred and eighty (180) days after the end of each of its financial years, its audited consolidated financial statements for that financial year, together with a Compliance Certificate, signed by two directors of the Corporate Guarantor, setting out (in reasonable detail) computations as to compliance with Clause 13.2.23 as at the date at which those financial statements were drawn up.
 

	
                         
 	
                        13.1.2
 	
                        Management accounts The Borrower or the Managers will supply to the Lender, on the Lender’s request within sixty (60) days of the end of each calendar year during the Facility Period the unaudited management accounts for the Vessel prepared by the Managers showing the income and expenditure for the Vessel for such calendar year.
 

	
                         
 	
                        13.1.3
 	
                        Requirements as to financial statements Each set of financial statements delivered by the Corporate Guarantor under Clauses 13.1.1 and 13.1.4 shall be:-
 

 

15

 

 

 

	
                         
 	
                        (a)
 	
                        prepared using GAAP; and
 

	
                         
 	
                        (b)
 	
                        certified by a director of the Corporate Guarantor as fairly representing its financial condition as at the date at which those financial statements were drawn up.
 

	
                         
 	
                        13.1.4
 	
                        Interim financial statements The Borrower shall procure that the Corporate Guarantor supplies to the Lender as soon as the same become available, but in any event within ninety (90) days after the end of each quarter during each of the Corporate Guarantor’s financial years, its unaudited consolidated quarterly financial statements for that quarter, together with a Compliance Certificate to be provided on a semi-annual basis, signed by two directors of the Corporate Guarantor, setting out (in reasonable detail) computations as to compliance with Clause 13.2.23 as at the date at which those financial statements were drawn up.
 

	
                         
 	
                        13.1.5
 	
                        Information: miscellaneous The Borrower shall supply to the Lender:
 

	
                         
 	
                        (a)
 	
                        all documents dispatched by the Borrower to its shareholders (or any class of them) or its creditors generally at the same time as they are dispatched other than any documents that are subject to any confidentiality restrictions pursuant to the New York Stock Exchange regulations that may prohibit such dissemination;
 

	
                         
 	
                        (b)
 	
                        promptly upon becoming aware of them, details of any litigation, arbitration or administrative proceedings which are current, threatened or pending against any Security Party, and which might, if adversely determined, have a materially adverse effect on the business, assets, financial condition or credit worthiness of that Security Party; and
 

	
                         
 	
                        (c)
 	
                        promptly, such further information regarding the financial condition, business and operations of any Security Party as the Lender may reasonably request.
 

 

16

 

 

	
                         
 	
                        13.1.6
 	
                        Notification of default
 

	
                         
 	
                        (a)
 	
                        The Borrower shall notify the Lender of any Default (and the steps, if any, being taken to remedy it) promptly upon becoming aware of its occurrence.
 

	
                         
 	
                        (b)
 	
                        Promptly upon a request by the Lender, the Borrower shall supply to the Lender a certificate signed by two of its directors or senior officers on its behalf certifying that no Default is continuing (or if a Default is continuing, specifying the Default and the steps, if any, being taken to remedy it).
 

	
                         
 	
                        13.1.7
 	
                        “Know your customer” checks If:
 

	
                         
 	
                        (a)
 	
                        the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation made after the date of this Agreement;
 

	
                         
 	
                        (b)
 	
                        any change in the status of the Borrower after the date of this Agreement; or
 

	
                         
 	
                        (c)
 	
                        a proposed assignment or transfer by the Lender of any of its rights and obligations under this Agreement,
 

obliges the Lender (or, in the case of (c) above, any prospective new Lender) to comply with “know your customer” or similar identification procedures in circumstances where the necessary information is not already available to it, the Borrower shall promptly upon the request of the Lender supply, or procure the supply of, such documentation and other evidence as is reasonably requested by the Lender for itself (or, in the case of (c) above, on behalf of any prospective new Lender) in order for the Lender (or, in the case of (c) above, any prospective new Lender) to carry out and be satisfied it has complied with all necessary “know your customer” or other similar checks under all applicable laws and regulations pursuant to the transactions contemplated in the Finance Documents.

 

 

17

 

	
                         
 	
                        4.1.12
 	
                        Clause 13.2.6 of the Original Facility Agreement shall be deleted and replaced by the following:-
 

	
                         
 	
                        “13.2.6
 	
                        Negative pledge and no disposals Other than in favour of the Lender, the Borrower shall not create nor permit to subsist any Encumbrance or other third party rights over any of its present or future assets or undertaking nor dispose of any those assets or of all or part of that undertaking.”
 

	
                         
 	
                        4.1.13
 	
                        Clause 13.2.7 of the Original Facility Agreement shall be deleted and replaced by the following:-
 

	
                         
 	
                        “13.2.7
 	
                        Merger The Borrower shall not without the prior written consent of the Lender enter into any amalgamation, demerger, merger or corporate reconstruction other than the Reorganization.”
 

	
                         
 	
                        4.1.14
 	
                        Clause 13.2.12 of the Original Facility Agreement shall be deleted and replaced by the following:-
 

	
                         
 	
                        “13.2.12
 	
                        No substantial liabilities Except in the ordinary course of business and other than in favour of the Lender, the Borrower shall not without the prior written consent of the Lender incur any liability to any third party which is in the Lender’s opinion of a substantial nature.”
 

	
                         
 	
                        4.1.15
 	
                        Clause 13.2.13 of the Original Facility Agreement shall be deleted and replaced by the following:-
 

	
                         
 	
                        “13.2.13
 	
                        No loans or other financial commitments The Borrower shall not without the prior written consent of the Lender make any loan nor enter into any guarantee or indemnity (other than the Avstes Guarantees, other than any guarantee or indemnity from time to time required by any insurer and which is in accordance with the terms and conditions of clause 5 of the Deed of Covenants, the Insurances and any acceptable Insurance letter of undertaking) or otherwise voluntarily assume any actual or contingent liability in respect of any obligation of any other person.”
 

 

 

18

 

	
                         
 	
                        4.1.16
 	
                        Clause 13.2.14 of the Original Facility Agreement shall be deleted.
 

	
                         
 	
                        4.1.17
 	
                        Clause 13.2.15 of the Original Facility Agreement shall be deleted and replaced by the following:-
 

	
                         
 	
                        “13.2.15
 	
                        Inspection of records The Borrower will permit the inspection of its financial records and accounts and procure that the Corporate Guarantor permits the inspection of the Corporate Guarantor’s financial records and accounts from time to time by the Lender or its nominee.”
 

	
                         
 	
                        4.1.18
 	
                        Clause 13.2.17 of the Original Facility Agreement shall be deleted and replaced by the following:-
 

	
                         
 	
                        “13.2.17
 	
                        No change in ownership or control of the Borrower of the Managers The Borrower shall not cease to be a wholly owned Subsidiary of the Corporate Guarantor and shall not permit any change in the beneficial ownership and control of the Managers from that advised to the Lender on the date of the Listing.”
 

	
                         
 	
                        4.1.19
 	
                        Clause 13.2.20 of the Original Facility Agreement shall be deleted and replaced by the following:-
 

	
                         
 	
                        “13.2.20
 	
                        Charters The Borrower shall inform the Lender of its entry into any Charter (other than the Existing Charter) and of any extensions, increases or decreases in charterhire or other material amendments to a Charter.”
 

	
                         
 	
                        4.1.20
 	
                        An additional clause 13.2.21 shall be added to the Original Facility Agreement which shall be read and construed as follows:-
 

	
                         
 	
                        “13.2.21
 	
                        Ownership The Borrower shall procure that the Corporate Guarantor shall remain directly or indirectly beneficially owned by its Current Shareholders or any of them at a minimum of fifty one per cent (51%).” 
 

	
                         
 	
                        4.1.21
 	
                        An additional clause 13.2.22 shall be added to the Original Facility Agreement which shall be read and construed as follows:-
 

 

 

19

 

	
                         
 	
                        “13.2.22
 	
                        Guarantees and indemnities The Borrower shall by not later than the execution date of the Vessel Agreements execute in favour of the Lender guarantees and indemnities in such forms and containing such terms and conditions as the Lender shall in its discretion require and which shall secure the Vessel A Indebtedness and the Vessel B Indebtedness, and shall procure that each Owner shall by not later than the execution date of the relevant Vessel Agreement grant in favour of the Lender a guarantee and indemnity in such form and containing such terms and conditions as the Lender shall in its discretion require and which shall secure the Indebtedness.”
 

	
                         
 	
                        4.1.22
 	
                        An additional clause 13.2.23 shall be added to the Original Facility Agreement which shall be read and construed as follows:-
 

	
                         
 	
                        “13.2.23
 	
                        Financial covenants The Borrower shall procure that the Corporate Guarantor shall on a consolidated basis comply with the following financial covenants to be assessed on a semi-annual basis based on the Accounting Information received by the Lender in accordance with Clauses 13.1.1 and 13.1.4:-
 

	
                         
 	
                        (a)
 	
                        Consolidated Group Leverage The Consolidated Group Leverage shall be equal to or less than seventy per cent (70%).
 

	
                         
 	
                        (b)
 	
                        Debt to EBITDA ratio The ratio of Debt to EBITDA on a trailing twelve (12) month’s basis shall not at any time exceed 5.5:1.
 

	
                         
 	
                        (c)
 	
                        Net Worth The Net Worth shall not at any time be less than one hundred and seventy five million Dollars ($175,000,000).”
 

	
                         
 	
                        4.1.23
 	
                        Clause 14.1.8 of the Original Facility Agreement shall be deleted and replaced by the following:-
 

	
                         
 	
                        “14.1.8
 	
                        Change in ownership or control of the Borrower or the Managers The Borrower ceases to be a wholly owned Subsidiary of the Corporate Guarantor or there is any change in the beneficial 
 

 

 

20

 

ownership or control of the Borrower or the Managers from that advised to the Lender by the Borrower on the date of the Listing.”

	
                         
 	
                        4.1.24
 	
                        Clause 14.1.14 of the Original Facility Agreement shall be deleted and replaced by the following:-
 

	
                         
 	
                        “14.1.14
 	
                        Reduction of capital A Security Party (other than the Corporate Guarantor) reduces its authorised or issued or subscribed capital.”
 

	
                         
 	
                        4.1.25
 	
                        An additional clause 14.1.20 shall be added to the Original Facility Agreement which shall be read and construed as follows:-
 

	
                         
 	
                        “14.1.20
 	
                        Notice of termination Any of the Guarantors gives notice to the Lender to determine its obligations under the relevant Guarantee.”
 

	
                         
 	
                        4.1.26
 	
                        Clause 22.5 of the Original Facility Agreement shall be deleted and replaced by the following:-
 

	
                         
 	
                        “22.5
 	
                        Service of process Without prejudice to any other mode of service allowed under any relevant law, each Security Party:
 

	
                         
 	
                        22.5.1
 	
                        irrevocably appoints Mr. Savvas Savvides, 24 Exeter Road, London N14 5JY, England (tel/fax: +44 208 361 2606) as its agent for service of process in relation to any proceedings before the English courts in connection with this Agreement; and
 

	
                         
 	
                        22.5.2
 	
                        agrees that failure by a process agent to notify the relevant Security Party of the process will not invalidate the proceedings concerned.”
 

	
                         
 	
                        4.1.27
 	
                        All references to “this Agreement” shall be references to the Original Facility Agreement as amended and/or supplemented by this Supplemental Agreement.
 

	
                         
 	
                        4.1.28
 	
                        The Schedule to this Supplemental Agreement shall be incorporated as “Schedule 4” to the Original Facility Agreement.
 

 

 

21

 

	
                         
 	
                        4.1.29
 	
                        All references in the Security Documents to the Agreement (however it may be defined) shall be read and construed as the Original Facility Agreement as supplemented and amended hereby.
 

	
                         
 	
                        4.1.30
 	
                        All references to the “Security Documents” shall be shall be read and construed to include the Guarantees and the Operating Account Charge.
 

All other terms and conditions of the Original Facility Agreement shall remain unaltered and in full force and effect.

	
                        5
 	
                        Confirmation and Undertaking
 

	
                         
 	
                        5.1
 	
                        Each of the Security Parties confirms that all of its respective obligations under or pursuant to each of the Security Documents to which it is a party remain in full force and effect, despite the amendments to the Original Facility Agreement made in this Supplemental Agreement, as if all references in any of the Security Documents to the Facility Agreement (however described) were references to the Original Facility Agreement as amended and supplemented by this Supplemental Agreement.
 

	
                         
 	
                        5.2
 	
                        The definition of any term defined in any of the Security Documents shall, to the extent necessary, be modified to reflect the amendments to the Original Facility Agreement made in this Supplemental Agreement.
 

	
                        6
 	
                        Communications, Law and Jurisdiction
 

The provisions of clauses 18 and 22 of the Original Facility Agreement shall apply to this Supplemental Agreement as if they were set out in full and as if references to the Facility Agreement were references to this Supplemental Agreement and references to the Borrower were references to the Security Parties.

 

 

22

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

 

	
                        SIGNED and DELIVERED as
 	
                        )
 
	
                        a DEED by
 	
                        )
 
	
                        AVSTES SHIPPING CORPORATION 
 	
                        )
 
	
                        acting by
 	
                        )
 
	
                         
 	
                        )
 
	
                        its duly authorised attorney-in-fact
 	
                        )
 
	
                         
 	
                        )
 
	
                        in the presence of:
 	
                        )
 
	
                         
 	
                         
 
	
                         
 	
                         
 
	
                         
 	
                         
 
	
                        SIGNED and DELIVERED as
 	
                        )
 
	
                        a DEED by
 	
                        )
 
	
                        DnB NOR BANK ASA
 	
                        )
 
	
                         
 	
                         
 
	
                        acting by Sofia Tzanaki
 	
                        )
 
	
                         
 	
                        )
 
	
                        its duly authorised attorney-in-fact
 	
                        )
 
	
                         
 	
                        )
 
	
                        in the presence of: Fadil Nekebzade
 	
                        )
 

STEPHENSON HARWOOD

ARISTON BUILDING

2 FILELLINON STR. & AKTI MIAOULI

PIRAEUS 185 36

VAT. NO. 9 9 8 7 1 1 1 5 6

TEL 210 42 95 160

 

 

23

 

SCHEDULE

Form of Compliance Certificate

 

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

Dated:

Dear Sirs

Avstes Shipping Corporation – US$36,000,000 Reducing revolving multi-currency credit facility agreement dated 17 April 2008 as amended, supplemented, novated and/or replaced from time to time (the “Agreement”)

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

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

We confirm that:

 

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

 

 

24

[We confirm that no Default is continuing.]*

 

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

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

 

 

25

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00142-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00142-of-00352.parquet"}]]