¨ Yes¨ No

TABLE OF CONTENTS

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS		3
PART I
Item 1.	Identity of Directors, Senior Management and Advisers	54
Item 2.	Offer Statistics and Expected Timetable	54
Item 3.	Key Information	54
Item 4.	Information on the Company	3031
Item 4A.	Unresolved Staff Comments	4947
Item 5.	Operating and Financial Review and Prospects	4947
Item 6.	Directors, Senior Management and Employees	7169
Item 7.	Major Shareholders and Related Party Transactions	7673
Item 8.	Financial Information	7874
Item 9.	The Offer and Listing	7976
Item 10.	Additional Information	8076
Item 11.	Quantitative and Qualitative Disclosures About Market Risk	9691
Item 12.	Description of Securities Other than Equity Securities	9892
PART II
Item 13.	Defaults, Dividend Arrearages and Delinquencies	9892
Item 14.	Material Modifications to the Rights of Security Holders and Use of Proceeds	9893
Item 15.	Controls and Procedures	9893
Item 16A.	Audit Committee Financial Expert	9994
Item 16B.	Code of Ethics	9994
Item 16C.	Principal Accountant Fees and Services	9994
Item 16D.	Exemptions from the Listing Standards for Audit Committees	9994
Item 16E.	Purchases of Equity Securities by the Issuer and Affiliated Purchasers	~~100~~95
Item 16F.	Change in Registrant’s Certifying Accountant	~~100~~95
Item 16G.	Corporate Governance	~~100~~95
Item 16H.	Mining Safety Disclosure	95
PART III
Item 17.	Financial Statements	~~100~~95
Item 18.	Financial Statements	~~100~~95
Item 19.	Exhibits	~~100~~95

INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS		F-1

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This annual report on Form 20-F contains forward-looking statements and information within the meaning of U.S. securities laws, and Globus Maritime Limited desires to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and is including this cautionary statement in connection with this safe harbor legislation.

The “Company,” “Globus,” “Globus Maritime,” “we,” “our” and “us” refer to Globus Maritime Limited and its subsidiaries, unless the context otherwise requires.

Forward-looking statements provide our current expectations or forecasts of future events. Forward-looking statements include statements about our expectations, beliefs, plans, objectives, intentions, assumptions and other statements that are not historical facts or that are not present facts or conditions. Forward-looking statements and information can generally be identified by the use of forward-looking terminology or words, such as, “anticipate,” “approximately,” “believe,” “continue,” “estimate,” “expect,” “forecast,” “intend,” “may,” “ongoing,” “pending,” “plan,” “potential,” “predict,” “project,” “seeks,” “should,” “views” or similar words or phrases or variations thereon, or the negatives of those words or phrases, or statements that events, conditions or results “can,” “will,” “may,” “must,” “would,” “could” or “should” occur or be achieved and similar expressions in connection with any discussion, expectation or projection of future operating or financial performance, costs, regulations, events or trends. The absence of these words does not necessarily mean that a statement is not forward-looking. Forward-looking statements and information are based on management’s current expectations and assumptions, which are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict.

Without limiting the generality of the foregoing, all statements in this annual report on Form 20-F concerning or relating to estimated and projected earnings, margins, costs, expenses, expenditures, cash flows, growth rates, future financial results and liquidity are forward-looking statements. In addition, we, through our senior management, from time to time may make forward-looking public statements concerning our expected future operations and performance and other developments. Such forward-looking statements are necessarily estimates reflecting our best judgment based upon current information and involve a number of risks and uncertainties. Other factors may affect the accuracy of these forward-looking statements and our actual results may differ materially from the results anticipated in these forward-looking statements. While it is impossible to identify all such factors, factors that could cause actual results to differ materially from those estimated by us may include, but are not limited to, those factors and conditions described under “Item 3.D. Risk Factors” as well as general conditions in the economy, dry bulk industry and capital markets. We undertake no obligation to revise any forward-looking statement to reflect circumstances or events after the date of this annual report on Form 20-F or to reflect the occurrence of unanticipated events or new information, other than any obligation to disclose material information under applicable securities laws. Forward-looking statements appear in a number of places in this annual report on Form 20-F including, without limitation, in the sections entitled “Item 5. Operating and Financial Review and Prospects,” “Item 4.A. Information on the Company—Business Overview” and “Item 8.A. Consolidated Statements and Other Financial Information—Dividend Policy.”

Terms Used in this Annual Report on Form 20-F

References to our common shares are references to Globus Maritime Limited’s registered common shares, par value $0.004 per share, or, as applicable, the ordinary shares of Globus Maritime Limited prior to our redomiciliation into the Marshall Islands on November 24, 2010.

References to our Class B shares are references to Globus Maritime Limited’s registered Class B shares, par value $0.001 per share, none of which are currently outstanding. We refer to both our common shares and Class B shares as our shares.

References to our shareholders are references to the holders of our common shares and Class B shares. References to our Series A Preferred Shares are references to our shares of Series A preferred stock, par value $0.001 per share, 2,567 of which were outstanding as of December 31, 2013 and on the date of this annual report on Form 20-F.

On July 29, 2010, we effected a four-for-one reverse split of our common shares. Unless otherwise noted, all historical share numbers and per share amounts in this annual report on Form 20-F have been adjusted to give effect to this reverse split.

Unless otherwise indicated, all references to “dollars” and “$” in this annual report on Form 20-F are to, and amounts are presented in, U.S. dollars.

Rounding

Certain financial information has been rounded, and, as a result, certain totals shown in this annual report on Form 20-F may not equal the arithmetic sum of the figures that should otherwise aggregate to those totals.

PART I

Item 1. Identity of Directors, Senior Management and Advisers

Not Applicable.

Item 2. Offer Statistics and Expected Timetable

Not Applicable.

Item 3. Key Information

A. Selected Financial Data

The following tables set forth our selected consolidated financial and operating data. The summary consolidated financial data as of and for the years ended December 31, 2013, 2012, 2011, 2010 ~~2009, 2008~~ and ~~2007~~2009 are derived from our audited consolidated financial statements, which have been prepared in accordance with International Financial Reporting Standards, or IFRS, as issued by the International Accounting Standards Board, or IASB. ~~We have not included financial information as of and for the year ended December 31, 2006 due to the unreasonable effort or expense of preparing such information.~~ The data set forth below should be read in conjunction with “Item 5. Operating and Financial Review and Prospects” and our audited consolidated financial statements, related notes and other financial information included elsewhere in this annual report on Form 20-F. Results of operations in any period are not necessarily indicative of results in any future period.

Year Ended December 31,
(Expressed in Thousands of U.S. Dollars, except per share data)
2010 2009 2008 2007
Statements of comprehensive income data
Revenue 28,860 52,812 98,597 40,960
Voyage expenses (2,152 ) (3,742 ) (6,674 ) (2,245 )
Net revenue(1) 26,708 49,070 91,923 38,715
Vessel operating expenses (5,887 ) (10,137 ) (12,537 ) (7,639 )
Depreciation (7,367 ) (11,204 ) (17,407 ) (10,212 )
Depreciation of drydocking costs (410 ) (1,512 ) (1,572 ) (1,033 )
Administrative expenses (2,310 ) (2,004 ) (2,122 ) (1,292 )
Administrative expenses payable to related parties (1,066 ) (1,272 ) (1,216 ) (1,377 )
Share based payments (311 ) (1,754 ) (770 ) (380 )
Impairment loss - (28,429 ) (20,224 ) -
Gain/(loss) on sale of vessels 7 (802 ) 15,095 -
Other (expenses)/income, net (35 ) (106 ) 408 (36 )
Operating profit/(loss) before financial activities 9,329 (8,150 ) 51,578 16,746

Interest income from bank balances & deposits 247 1,032 946 577
Interest expense and finance costs (2,133 ) (2,926 ) (7,707 ) (5,596 )
(Loss) /gain on derivative financial instruments (570 ) 143 (1,373 ) -
Foreign exchange (losses)/gains, net (870 ) (178 ) (626 ) 298
Total loss from financing activities (3,326 ) (1,929 ) (8,760 ) (4,721 )
Total comprehensive income/(loss) for the year 6,003 (10,079 ) 42,818 12,025

Attributable to:
Shareholders of Globus Maritime Limited 6,003 (10,079 ) 42,818 11,210
Non-controlling interest - - - 815
6,003 (10,079 ) 42,818 12,025

Basic earnings/(loss) per share for the period/year 0.83 (1.40 ) 5.98 1.89
Diluted earnings/(loss) per share for the period/year 0.82 (1.40 ) 5.93 1.89
Adjusted EBITDA(2) (unaudited) 17,099 33,797 75,686 27,991

	Year Ended December 31,
	(Expressed in Thousands of U.S. Dollars, except per share data)
	2013			2012			2011			2010			2009
Statements of comprehensive income data
Revenue		29,434			32,197			35,559			28,860			52,812
Voyage expenses		(2,892	)		(4,450	)		(3,283	)		(2,152	)		(3,742	)
Net revenue(1)		26,542			27,747			32,276			26,708			49,070
Vessel operating expenses		(10,031	)		(10,400	)		(7,967	)		(5,887	)		(10,137	)
Depreciation		(5,622	)		(11,255	)		(10,180	)		(7,367	)		(11,204	)
Depreciation of drydocking costs		(434	)		(763	)		(318	)		(410	)		(1,512	)
Amortization of fair value of time charter attached to vessels		(1,261	)		(1,823	)		(779	)		-			-
Administrative expenses		(2,092	)		(1,869	)		(2,078	)		(2,310	)		(2,004	)
Administrative expenses payable to related parties		(620	)		(598	)		(1,150	)		(1,066	)		(1,272	)
Share based payments		189			(977	)		(364	)		(311	)		(1,754	)
Impairment gain/(loss)		1,679			(80,244	)		-			-			(28,429	)
Gain/(loss) on sale of vessels		-			-			-			7			(802	)
Other income/(expenses), net		127			(68	)		(124	)		(35	)		(106	)
Operating profit/(loss) before financing activities		8,477			(80,250	)		9,316			9,329			(8,150	)

Interest income from bank balances & bank deposits		41			47			52			247			1,032
Interest expense and finance costs		(3,571	)		(3,358	)		(2,821	)		(2,133	)		(2,926	)
Gain/(loss) on derivative financial instruments		738			693			369			(570	)		143
Foreign exchange (losses)/gains, net		(8	)		64			9			(870	)		(178	)
Total finance costs, net		(2,800	)		(2,554	)		(2,391	)		(3,326	)		(1,929	)
Total comprehensive income/(loss) for the year		5,677			(82,804	)		6,925			6,003			(10,079	)


Basic earnings/(loss) per share for the year		0.52			(8.22	)		0.80			0.83			(1.40	)
Diluted earnings/(loss) per share for the year		0.52			(8.22	)		0.79			0.82			(1.40	)
Weighted average number of common shares, basic		10,215,997			10,142,979			8,688,543			7,243,340			7,192,369
Weighted average number of common shares, diluted		10,215,997			10,142,979			8,738,444			7,340,221			7,192,369
Dividends declared per common share		-			0.25			0.64			0.27			-
Adjusted EBITDA(2) (unaudited)		14,115			13,835			20,593			17,099			33,797

(1) Net Revenue is computed by subtracting voyage expenses from revenue. Net Revenue is not a recognized measurement under IFRS and should not be considered as an alternative or comparable to net income.

(2) Adjusted EBITDA represents net earnings before interest and finance costs net, gains or losses from the change in fair value of derivative financial instruments, foreign exchange gains or losses, income taxes, depreciation, depreciation of ~~drydocking~~dry-docking costs, amortization of fair value of time charter attached to vessels, impairment and gains or losses from sale of vessels. Adjusted EBITDA does not represent and should not be considered as an alternative to total comprehensive income/(loss) or cash generated from operations, as determined by IFRS, and our calculation of Adjusted EBITDA may not be comparable to that reported by other companies. Adjusted EBITDA is not a recognized measurement under IFRS.

Adjusted EBITDA is included herein because it is a basis upon which we assess our financial performance and because we believe that it presents useful information to investors regarding a company’s ability to service and/or incur indebtedness and it is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry.

Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our results as reported under IFRS. Some of these limitations are:

Adjusted EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments;

Adjusted EBITDA does not reflect the interest expense or the cash requirements necessary to service interest or principal payments on our debt;

Adjusted EBITDA does not reflect changes in or cash requirements for our working capital needs; and

other companies in our industry may calculate Adjusted EBITDA differently than we do, limiting its usefulness as a comparative measure.

Because of these limitations, Adjusted EBITDA should not be considered a measure of discretionary cash available to us to invest in the growth of our business.

The following table sets forth a reconciliation of total comprehensive income/(loss) to Adjusted EBITDA (unaudited) for the periods presented:

Year Ended December 31,
(Expressed in Thousands of U.S. Dollars)
2010 2009 2008 2007
Total comprehensive income/(loss) for the year 6,003 (10,079 ) 42,818 12,025
Interest and finance costs, net 1,886 1,894 6,761 5,019
Loss/(gain) on derivative financial instruments 570 (143 ) 1,373 -
Foreign exchange losses/(gains) 870 178 626 (298 )
Depreciation 7,367 11,204 17,407 10,212
Depreciation of drydocking costs 410 1,512 1,572 1,033
(Gain)/loss on sale of vessels (7 ) 802 (15,095 ) -
Impairment loss - 28,429 20,224 -
Adjusted EBITDA (unaudited) 17,099 33,797 75,686 27,991

Year Ended December 31,
(Expressed in Thousands of U.S. Dollars)
2010 2009 2008 2007
Statements of financial position data
Total non-current assets 191,556 93,204 216,075 273,781
Total current assets (including “Non-current assets classified as held for sale”) 26,896 94,366 68,371 11,719
Total assets 218,452 187,570 284,446 285,500
Total equity 117,788 113,458 121,783 96,677
Total non-current liabilities 85,388 36,218 79,735 157,069
Total current liabilities 15,276 37,894 82,928 31,754
Total equity and liabilities 218,452 187,570 284,446 285,500

Year Ended December 31,
(Expressed in Thousands of U.S. Dollars)
2010 2009 2008 2007
Statements of cash flows data
Net cash generated from operating activities 16,182 33,566 70,383 30,248
Net cash (used in)/generated from investing activities (72,719 ) 60,253 27,077 (183,044 )
Net cash generated from/(used in) financing activities 27,034 (74,496 ) (72,857 ) 159,770

Year Ended December 31,
2010 2009 2008 2007
Ownership days(1) 1,458 2,314 2,878 2,017
Available days(2) 1,458 2,277 2,808 1,965
Operating days(3) 1,441 2,246 2,781 1,837
Bareboat charter days(4) 186 - - -
Fleet utilization(5) 98.8 % 98.6 % 99.0 % 93.5 %
Average number of vessels(6) 4.0 6.3 7.9 5.5
Daily time charter equivalent (TCE) rate(7) $ 18,996 $ 21,550 $ 32,736 $ 19,702

	Year Ended December 31,
	(Expressed in Thousands of U.S. Dollars)
	2013			2012			2011			2010			2009
Total comprehensive income/(loss) for the year		5,677			(82,804	)		6,925			6,003			(10,079	)
Interest and finance costs, net		3,530			3,311			2,769			1,886			1,894
(Gain)/loss on derivative financial instruments		(738	)		(693	)		(369	)		570			(143	)
Foreign exchange losses/(gains)		8			(64	)		(9	)		870			178
Depreciation		5,622			11,255			10,180			7,367			11,204
Depreciation of drydocking costs		434			763			318			410			1,512
Amortization of fair value of time charter attached to vessels		1,261			1,823			779			-			-
(Gain)/loss on sale of vessels		-			-			-			(7	)		802
Impairment (gain)/loss		(1,679	)		80,244			-			-			28,429
Adjusted EBITDA (unaudited)		14,115			13,835			20,593			17,099			33,797

	As of December 31,
	(Expressed in Thousands of U.S. Dollars)
	2013		2012		2011		2010		2009
Statements of financial position data
Total non-current assets		133,707		140,966		242,592		191,556		93,204
Total current assets (including “Non-current assets classified as held for sale”)		21,955		24,756		13,467		26,896		94,366
Total assets		155,662		165,722		256,059		218,452		187,570
Total equity		60,340		55,182		140,019		117,788		113,458
Total non-current liabilities		72,801		78,812		105,584		85,388		36,218
Total current liabilities		22,521		31,728		10,456		15,276		37,894
Total equity and liabilities		155,662		165,722		256,059		218,452		187,570

	Year Ended December 31,
				(Expressed in Thousands of U.S. Dollars)
	2013			2012			2011			2010			2009
Statements of cash flows data
Net cash generated from operating activities		12,357			14,370			19,774			16,182			33,566
Net cash (used in)/generated from investing activities		(1,016	)		(341	)		(61,782	)		(72,719	)		60,253
Net cash (used in)/generated from financing activities		(17,123	)		(11,680	)		25,681			27,034			(74,496	)

	Year Ended December 31,
	2013			2012			2011			2010			2009
Ownership days(1)		2,555			2,562			2,125			1,458			2,314
Available days(2)		2,527			2,498			2,111			1,458			2,277
Operating days(3)		2,486			2,471			2,083			1,441			2,246
Bareboat charter days(4)		365			366			365			186			-
Fleet utilization(5)		98.4	%		98.9	%		98.7	%		98.8	%		98.6	%
Average number of vessels(6)		7.0			7.0			5.8			4.0			6.3
Daily time charter equivalent (TCE) rate(7)	$	9,961		$	10,660		$	15,619		$	18,996		$	21,550

(1) Ownership days are the aggregate number of days in a period during which each vessel in our fleet has been owned by us.

(2) Available days are the number of our ownership days less the aggregate number of days that our vessels are off-hire due to scheduled repairs or repairs under guarantee, vessel upgrades or special surveys.

(3) Operating days are the number of available days in a period less the aggregate number of days that the vessels are off-hire due to any reason, including unforeseen circumstances.

(4) Bareboat charter days are the aggregate number of days in a period during which the vessels in our fleet are subject to a bareboat charter.

(5) We calculate fleet utilization by dividing the number of our operating days during a period by the number of our available days during the period.

(6) Average number of vessels is measured by the sum of the number of days each vessel was part of our fleet during a relevant period divided by the number of calendar days in such period.

(7) TCE rates are our revenue less net revenue from our bareboat charters less voyage expenses during a period divided by the number of our available days during the period excluding bareboat charter days, ~~which is consistent with industry standards.~~. TCE is a measure not in accordance with generally accepted accounting principles, or GAAP. Please read “Item 5. Operating and Financial Review and Prospects.”

The following table reflects the calculation of our daily TCE rates for the periods presented.

Year Ended December 31,

(Expressed in Thousands of U.S. Dollars, except number of days and daily
TCE rates)

2010 2009 2008 2007

Revenue 28,860 52,812 98,597 40,960
Less: Voyage expenses 2,152 3,742 6,674 2,245
Less: bareboat charter net revenue 2,545 - - -
Net revenue excluding bareboat charter net revenue 24,163 49,070 91,923 38,715
Available days net of bareboat charter days 1,272 2,277 2,808 1,965
Daily TCE rate 18,996 21,550 32,736 19,702

	Year Ended December 31,
	(Expressed in Thousands of U.S. Dollars, except number of days and daily TCE rates)
	2013		2012		2011		2010		2009

Revenue		29,434		32,197		35,559		28,860		52,812
Less: Voyage expenses		2,892		4,450		3,283		2,152		3,742
Less: bareboat charter net revenue		5,006		5,020		5,006		2,545		-
Net revenue excluding bareboat charter net revenue		21,536		22,727		27,270		24,163		49,070
Available days net of bareboat charter days		2,162		2,132		1,746		1,272		2,277
Daily TCE rate		9,961		10,660		15,619		18,996		21,550

The figure below presents in a condensed form total comprehensive income/(loss) for the years ended December 31, 2013, 2012, 2011, 2010 and 2009, expressed in thousands of U.S. dollars except of daily TCE rates.

B. Capitalization and Indebtedness

Not Applicable.

C. Reasons for the Offer and Use of Proceeds

Not Applicable.

D. Risk Factors

This annual report on Form 20-F contains forward-looking statements and information within the meaning of U.S. securities laws that involve risks and uncertainties. Our actual results may differ materially from the results discussed in the forward-looking statements and information. Factors that may cause such a difference include those discussed below and elsewhere in this annual report on Form 20-F.

Some of the following risks relate principally to the industry in which we operate and our business in general. Other risks relate principally to the securities market and ownership of our common shares. The occurrence of any of the events described in this section could significantly and negatively affect our business, financial condition, operating results, ability pay dividends or the trading price of our common shares.

Risks relating to Our Industry

The seaborne transportation industry is cyclical and volatile.

The international seaborne transportation industry is ~~both~~ cyclical and ~~volatile~~has high volatility in ~~terms of~~ charter rates, vessel values and profitability. Fluctuations in charter rates result from changes in the supply and demand for vessel capacity and changes in the supply and demand for energy resources, commodities, semi-finished and finished consumer and industrial products internationally carried at sea. ~~For example,~~Since the ~~degree~~early part of ~~charter hire rate volatility among different types~~2009, rates have been volatile, but gradually recovered from market lows with further improvements taking place in the first half of ~~dry bulk vessels has varied widely. After~~2010, before leveling out in the second half of 2010, declining in 2011 throughout 2012. In 2013 rates remained volatile reaching ~~historical~~their lows in January 2013 and their highs in ~~mid-2008, charter hire rates for Supramax and Panamax dry bulk vessels reached near historically low levels at the end of 2008, and have since recovered to some extent.~~December 2013. Because from time to time we may charter some of our vessels pursuant to short-term time charters or on the spot market, we may be exposed to changes in spot market and short-term charter rates for dry bulk vessels and such changes may affect our earnings and the value of our dry bulk vessels at any given time. The supply of and demand for shipping capacity strongly influences freight rates. The factors affecting the supply and demand for vessels are outside of our control, and the nature, timing and degree of changes in industry conditions are unpredictable.

Factors that influence demand for vessel capacity include:

supply and demand for energy resources, commodities, semi-finished and finished consumer and industrial products;

changes in the production of energy resources, commodities, semi-finished and finished consumer and industrial products;

the location of regional and global production and manufacturing facilities;

the location of consuming regions for energy resources, commodities, semi-finished and finished consumer and industrial products;

the globalization of production and manufacturing;

global and regional economic and political conditions;

developments in international trade;

changes in seaborne and other transportation patterns, including the distance dry bulk cargo is transported by sea;

environmental and other regulatory developments;

currency exchange rates; and

weather.

Factors that influence the supply of vessel capacity include:

the number of newbuilding ~~deliveries, which among other factors relates to the ability of shipyards to deliver newbuildings by contracted delivery dates and the ability of purchasers to finance such newbuildings;~~deliveries;

the scrapping ~~rate~~ of older vessels;

vessel casualties;

the price of steel;

changes in environmental and other regulations that may limit the useful lives of vessels;

the number of vessels that are out of service; and

port or canal congestion.

In addition to the prevailing and anticipated freight rates, factors that affect the rate of newbuilding, scrapping and laying-up include newbuilding prices, secondhand vessel values in relation to scrap prices, costs of bunkers and other operating costs, costs associated with classification society surveys, normal maintenance and insurance coverage, the efficiency and age profile of the existing dry bulk fleet in the market and government and industry regulation of maritime transportation practices, particularly environmental protection laws and regulations. These factors influencing the supply of and demand for shipping capacity are outside of our control, and we may not be able to correctly assess the nature, timing and degree of changes in industry conditions.

We anticipate that the future demand for our dry bulk vessels and charter rates will be dependent upon continued economic growth in the world’s economies including China and India, seasonal and regional changes in demand and changes to the capacity of the global dry bulk vessel fleet and the sources and supply of dry bulk cargo to be transported by sea. Adverse economic, political, social or other developments could negatively impact charter rates and therefore have a material adverse effect on our business, results of operations and ability to pay dividends.

The dry bulk vessel charter market remains significantly below its high in 2008.

The revenues, earnings and profitability of companies in our industry are affected by the charter rates that can be obtained in the market, which is volatile and has experienced significant declines since its highs in the middle of 2008. ~~For example, the~~The Baltic Dry Index, or the BDI, which is published daily by the Baltic Exchange Limited, or the Baltic Exchange, a London-based membership organization that provides daily shipping market information to the global investing community, is an average of selected ship brokers’ assessments of time charter rates paid by a customer to hire a dry bulk vessel to transport dry bulk cargoes by sea. The BDI has long been viewed as the main benchmark to monitor the movements of the dry bulk vessel charter market and the performance of the entire dry bulk shipping market. The BDI declined from a high of 11,793 onin May ~~20,~~ 2008 to a low of 663 onin December 5, 2008, which represents a decline of ~~94%~~94.0% within a single calendar year. ~~The BDI fell over 70% during October 2008 alone.~~ During 2009, 2010 and ~~through 2010,~~2011, the BDI remained ~~volatile, reaching in~~volatile. During 2009, the BDI reached a low of 772 onin January 5, 2009 and a high of 4,661 onin November ~~19, 2009, and, in~~2009. During 2010, ~~reaching~~the BDI reached a high of 4,209 onin May ~~26,~~ 2010 and a low of 1,700 in July 2010. During 2011, the BDI remained volatile, ranging from a low of 1,042 on ~~July 15, 2010.~~February 4, 2011 to a high of 2,173 on October 14, 2011. The BDI continued to decline induring the ~~first two months~~start of ~~2011~~2012 reaching a 26-year low of 647 on February 3, 2012 and thereafter increased to ~~1,262~~a high of 1,165 as of ~~March 1, 2011. We believe~~May 8, 2012. In 2013, the BDI remained volatile reaching a low of 698 on January 2, 2013 and improved to 2,337 as of December 12, 2013. The BDI was 939 as of April 22, 2014. There can be no assurance that the dry bulk charter market will increase further, and the market can decline.

The decline and volatility in charter rates is primarily due to the number of newbuilding deliveries as vessel oversupply is gradually taking its toll on the market. Increased demand for dry bulk commodities has been ~~due~~unable to ~~various factors, including~~fully absorb the approximately 99.5 million, 99.7 million and 62.6 million new deadweight tonnage, or dwt, that entered the market in 2011, 2012 and 2013 respectively, despite almost record high scrapping levels of approximately 23.2 million, 33.6 million and 23.3 million dwt for the years 2011, 2012 and 2013, respectively. Although the number of dry bulk carriers on order has declined from the historic highs in recent years, there remains a substantial amount of capacity on order. The number of dry bulk vessels on order as of December 31, 2013 was approximately 23% for Supramax vessels, 27% for Panamax vessels and 17% for Capesize vessels of the then-existing global dry bulk fleet in terms of deadweight tons, with the majority of new deliveries expected mainly during 2014 and 2015. Due to lack of ~~trade~~ financing, ~~for purchases~~we expect cancellations and/or slippage of ~~commodities carried~~newbuilding orders. While vessel supply will continue to be affected by ~~sea, which has resulted in declines in cargo shipments,~~the delivery of new vessels and the ~~excess supply~~removal of ~~iron ore~~vessels from the global fleet, either through scrapping or accidental losses, an over-supply of dry bulk carrier capacity could exacerbate the recent decrease in ~~China,~~charter rates or prolong the period during which ~~has resulted in falling iron ore prices and increased stockpiles in Chinese ports.~~ low charter rates prevail.

The decline and volatility in charter rates in the dry bulk market also affects the value of our dry bulk vessels, which follows the trends of dry bulk charter rates, and earnings on our charters, and similarly affects our cash flows, liquidity and compliance with the covenants contained in our loan ~~agreements.~~

~~There remains considerable instability in the world economy.~~

We expect that a significant number of the port calls we expect our vessels to make will likely involve the loading or discharging of raw materials in ports in the Asia Pacific region, particularly China. As a result, a negative change in economic conditions in any Asia Pacific country, particularly China, Japan and, to some extent, India, can have a material adverse effect on our business, financial position and results of operations, as well as our future prospects, by reducing demand and, as a result, charter rates and affecting our ability to charter our vessels. In the recent past, China and India have had two of the world’s fastest growing economies in terms of gross domestic product and have been the main driving force behind increases in marine dry bulk trade and the demand for dry bulk vessels. If economic growth declines in China, Japan, India and other countries in the Asia Pacific region, we may face decreases in such dry bulk trade and demand. Moreover, a slowdown in the United States and Japanese economies or the economies of the European Union or certain Asian countries may adversely affect economic growth in China, India and elsewhere. Such an economic downturn in any of these countries could have a material adverse effect on our business, financial condition, results of operations and ability to pay dividends.

arrangements.

The international shipping industry and dry bulk market are highly competitive.

The shipping industry and dry bulk market are capital intensive and highly fragmented with many charterers, owners and operators of vessels and are characterized by intense competition. Competition arises primarily from other vessel owners, some of whom have substantially greater resources than we do. The trend towards consolidation in the industry is creating an increasing number of global enterprises capable of competing in multiple markets, which may result in a greater competitive threat to us. Our competitors may be better positioned to devote greater resources to the development, promotion and employment of their businesses than we are. Competition for the transportation of cargo by sea is intense and depends on customer relationships, operating expertise, professional reputation, price, location, size, age, condition and the acceptability of the vessel and its operators to the charterers. Competition may increase in some or all of our principal markets, including with the entry of new competitors, who may operate larger fleets through consolidations or acquisitions and may be able to sustain lower charter rates and offer higher quality vessels than we are able to offer. We may not be able to continue to compete successfully or effectively with our competitors and our competitive position may be eroded in the future, which could have an adverse effect on our fleet utilization and, accordingly, business, financial condition, results of operations and ability to pay dividends.

~~There may be changes~~

If economic conditions throughout the world do not improve, it will have an adverse impact on our operations and financial results.

Negative trends in the global economy that emerged in 2008 continue to adversely affect global economic conditions. In addition, the world economy continues to face a number of challenges, including the economic weakness in the European Union and the United States. The deterioration in the global economy has caused, and may continue to cause, a decrease in worldwide demand for certain goods, and thus, shipping. We cannot predict how long the current conditions will last. However, recent and developing economic and ~~political environment~~governmental factors, together with the concurrent decline in charter rates and vessel values, have had a material adverse effect on our results of operations, financial condition and cash flows and could cause the price of our common shares to decline.

The economies of the United States, the European Union and other parts of the world continue to experience relatively slow growth or remain in recession and exhibit weak economic trends. The credit markets in the United States and Europe have experienced significant contraction, deleveraging and reduced liquidity, and the U.S. federal government and state governments and European authorities continue to implement a broad variety of governmental action and/or new regulation of the financial markets. While credit conditions are beginning to stabilize, global financial markets have been, and continue to be, disrupted and volatile. Since 2008, lending by financial institutions worldwide remains at low levels compared to the period preceding 2008.

The continued economic slowdown in the Asia Pacific region, especially in Japan and China, may exacerbate the effect on us of the recent slowdown in the rest of the world. Before the global economic financial crisis that began in 2008, China had one of the world’s fastest growing economies in terms of gross domestic product, or GDP, which had a significant impact on shipping demand. The growth rate of China’s GDP for the year ended December 31, 2013, is estimated to remain around 7.7%, approximately the same growth rate as for the year ended December 31, 2012, remaining below pre-2008 levels. China has imposed measures to restrain lending, which may further contribute to a slowdown in its economic growth. China and other countries in the Asia Pacific region may continue to experience slowed or even negative economic growth in the future. Moreover, the current economic slowdown in the economies of the United States, the European Union and other Asian countries may further adversely affect economic growth in China and ~~China may adopt policies~~elsewhere. Our financial condition and results of operations, as well as our future prospects, would likely be impeded by a continuing or worsening economic downturn in any of these countries.

Such weak economic conditions could have a material adverse effect on our business, results of operations and financial condition and our ability to ~~regulate its economy.~~

~~The Chinese economy differs from the economies~~pay dividends to our shareholders. Our business, financial condition, results of ~~most countries belonging~~operations, ability to ~~the Organization for Economic Cooperation~~pay dividends as well as our future prospects, will likely be materially and Development in respects such as structure, government involvement, level of development, growth rate, capital reinvestment, allocation of resources, rate of inflation and balance of payments position. Prior to 1978, the Chinese economy was a planned economy. Since 1978, increasing emphasis has been placed on the utilization of market forces in the development of the Chinese economy. Annual and five year State Plans are adopted by the Chinese government in connection with the development of the economy. Although state-owned enterprises still account for a substantial portion of the Chinese industrial output, in general, the Chinese government is reducing the level of direct control that it exercises over the economy through State Plans and other measures. There is an increasing level of freedom and autonomy in areas such as allocation of resources, production, pricing and management and a gradual shift in emphasis to a “market economy” and enterprise reform. Limited price reforms were undertaken, with the result that prices for certain commodities are principally determined by market forces. Many of the reforms are unprecedented or experimental and may be subject to revision, change or abolition based upon the outcome of such experiments. We cannot assure you that the Chinese government will continue to pursue a policy of economic reform.

~~The level of imports to and exports from China could be~~ adversely affected by ~~changes~~a further economic downturn in any of these countries.

The Euro may not be stable and countries may be unable to refinance their debts.

As a result of the credit crisis in Europe, in particular in Greece, Italy, Ireland, Portugal and Spain, the European Commission created the European Financial Stability Facility, or the EFSF, and the European Financial Stability Mechanism, or the EFSM, to provide funding to Eurozone countries in financial difficulties that seek such support. In March 2011, the European Council agreed on the need for Eurozone countries to establish a permanent stability mechanism, the European Stability Mechanism, or the ESM, which was established in September 2012, to assume the role of the EFSF and the EFSM in providing external financial assistance to Eurozone countries. Despite these measures, concerns persist regarding the debt burden of certain Eurozone countries and their ability to meet future financial obligations and the overall stability of the euro. An extended period of adverse development in the outlook for European countries could reduce the overall demand for dry bulk cargoes and for our services.

The current state of the global financial markets and current economic conditions may adversely impact our ability to obtain financing on acceptable terms and otherwise negatively impact our business.

Global financial markets and economic conditions have been, and continue to be, volatile. Recently, operating businesses in the global economy have faced tightening credit, weakening demand for goods and services, deteriorating international liquidity conditions, and declining markets. There has been a general decline in the willingness by banks and other financial institutions to extend credit, particularly in the shipping industry, due to the historically volatile asset values of vessels. As the shipping industry is highly dependent on the availability of credit to finance and expand operations, it has been negatively affected by this decline.

Also, as a result of concerns about the stability of financial markets generally and the solvency of counterparties specifically, the cost of obtaining money from the credit markets has increased as many lenders have increased interest rates, enacted tighter lending standards, refused to refinance existing debt at all or on terms similar to current debt and reduced, and in some cases ceased, to provide funding to borrowers. Due to these factors, we cannot be certain that financing will be available if needed and to the extent required, on acceptable terms. If financing is not available when needed, or is available only on unfavorable terms, we may be unable to meet our obligations as they come due or we may be unable to enhance our existing business, complete additional vessel acquisitions or otherwise take advantage of business opportunities as they arise.

If the current global economic ~~reforms by~~environment persists or worsens, we may be negatively affected in the ~~Chinese government,~~following ways:

Øwe may not be able to employ our vessels at charter rates as ~~well~~favorable to us as ~~by changes in political, economic~~historical rates or operate our vessels profitably; and ~~social conditions or other relevant policies~~

Øthe market value of our vessels could decrease, which may cause us to recognize losses if any of our vessels are sold.

The occurrence of any of the ~~Chinese government, such as changes in laws, regulations or export and import restrictions, all of which~~foregoing could ~~adversely affect~~have a material adverse effect on our business, ~~operating~~ results of operations, cash flows and financial ~~condition and ability to pay dividends.~~

condition.

We depend on spot charters in volatile shipping markets.

We currently charter ~~two~~five of our ~~five~~seven vessels on the spot charter market, and we may charter other vessels on the spot market in the future. The spot charter market is highly competitive and spot charter rates may fluctuate significantly based upon available charters and the supply of and demand for seaborne shipping capacity. While our focus on the spot market may enable us to benefit if industry conditions strengthen, we must consistently procure spot charter business. Conversely, such dependence makes us vulnerable to declining market rates for spot charters and to the off-hire periods including ballast passages. Rates within the spot charter market are subject to volatile fluctuations while longer-term time charters provide income at pre-determined rates over more extended periods of time. There can be no assurance that we will be successful in keeping our vessels fully employed in these short-term markets or that future spot rates will be sufficient to enable the vessels to be operated profitably. A significant decrease in charter rates would affect value and adversely affect our profitability, cash flows and ability to pay dividends. We cannot give assurances that future available spot charters will enable us to operate our vessels profitably.

~~The~~

An over-supply of dry bulk ~~vessel~~carrier capacity may ~~be oversupplied.~~

depress the charter rates.

The market supply of dry bulk vessels has been increasing as a result of the delivery of numerous newbuilding orders over the last few years. Newbuildings were delivered in significant numbers starting at the beginning of 2006 and continued to be delivered in significant numbers through ~~2010. Furthermore, the~~2013. The number of dry bulk vessels on order ~~is near historic highs. As~~as of ~~January 2011, newbuilding orders had been placed~~December 31, 2013 was approximately 23% for ~~an aggregate of more than 50%~~Supramax vessels, 27% for Panamax vessels and 17% for Capesize vessels of the ~~current~~then-existing global dry bulk fleet in terms of deadweight tons, with the majority of new deliveries expected mainly during the next three years. We have also seen fewer vessels being scrapped at levels observed during the economic crisis. As a result, the dry bulk fleet remains an aged fleet that has not decreased in number.2014 and 2015. An oversupply of dry bulk vessel capacity, particularly during a period of economic recession, may result in a reduction of charter hire rates. If we cannot enter into charters on acceptable terms, we may have to secure charters on the spot market, where charter rates are more volatile and revenues are, therefore, less predictable, or we may not be able to charter our vessels at all. In addition, a material increase in the net supply of dry bulk vessel capacity without corresponding growth in dry bulk vessel demand could have a material adverse effect on our fleet utilization and our charter rates generally, and could, accordingly, materially adversely affect our business, financial condition, results of operations and ability to pay dividends.

The market values of our vessels have declined and may ~~decrease.~~

further decline.

The market value of dry bulk vessels has generally experienced high volatility. The market prices for secondhand and newbuilding dry bulk vessels in the recent past have declined from historically high levels to low levels within a short period of time. The market value of our vessels may increase and decrease depending on a number of factors including:

prevailing level of charter rates;

general economic and market conditions affecting the shipping industry;

competition from other shipping companies;

configurations, sizes and ages of vessels;

supply and demand for vessels;

other modes of transportation;

cost of newbuildings;

governmental or other regulations; and

technological advances.

If a determination is made that a vessel’s future useful life is limited or its future earnings capacity is reduced, it could result in an impairment of its value on our financial statements that would result in a charge against our earnings and the ~~market values~~reduction of our ~~vessels decline, we may incur losses if we sell one or more of our vessels, we may not be in compliance with certain covenants in our secured reducing revolving~~stockholders’ equity.

Our credit facility with Credit Suisse AG, which we refer to as our ~~credit facility, and~~Credit Facility, our loan agreement with Deutsche Schiffsbank Aktiengesellschaft (now Commerzbank), which we refer to as the Kelty Loan Agreement, and our loan agreement with DVB Bank SE, which we refer to as the DVB Loan Agreement, are secured by mortgages on our vessels, and require us to maintain specified collateral coverage ratios and to satisfy financial covenants, including requirements based on the market value of our vessels and our net worth. Since the middle of 2008, the prevailing conditions in the dry bulk charter market coupled with the general difficulty in obtaining financing for vessel purchases have led to a significant decline in the market values of our vessels, which caused us to breach certain covenants in our loan arrangements during 2012, and we ~~may not~~obtained waivers on certain covenants with respect to our Credit Facility and the DVB Loan Agreement effective from December 2012 to March 31, 2014. We also reached an agreement with Commerzbank to prepay $3.0 million during June 2013 in order for the Company to be ~~able~~fully compliant with the provisions of the Kelty Loan Agreement. Further declines of market values of our vessels can affect our ability to comply with various covenants and could also limit the amount of funds we are permitted to borrow under our current or future loan arrangements. If we are unable to comply with the financial and other covenants under our Credit Facility, the Kelty Loan Agreement and the DVB Loan Agreement, and if we are unable to obtain waivers, our lenders could accelerate our indebtedness and foreclose on vessels in our fleet, which would impair our ability to continue to conduct our business. If our indebtedness were accelerated in full or in part, it would be very difficult in the current financing environment for us to refinance our debt or obtain additional financing ~~all of~~and we could lose our vessels if our lenders foreclose upon their liens, which would adversely affect our business, financial condition, ability to continue our business and ~~financial condition.~~ pay dividends. As of December 31, 2013, we were in compliance with the loan covenants as amended or waived in our Credit Facility and the DVB Loan Agreement, and we were fully compliant with the loan covenants in our Kelty Loan Agreement. For a more detailed discussion on our loan covenants see “Item 5.B Liquidity and Capital Resources—Indebtedness.”

If we sell any vessel at a time when vessel prices have fallen and before we have recorded an impairment adjustment to our financial statements, the sale price may be agreed at ~~less~~a value lower than the vessel’s depreciated book value as in our financial statements at that time, resulting in a loss and a respective reduction in earnings. If the market values of our vessels decrease, such decrease and its effects could have a material adverse effect on our business, financial condition, results of operations and ability to pay dividends.

Our industry is subject to complex laws and regulations, including environmental regulations.

Our operations are subject to numerous laws and regulations in the form of international conventions and treaties, national, state and local laws and national and international regulations in force in the jurisdictions in which our vessels operate or are registered, which can significantly affect the ownership and operation of our vessels. These requirements include but are not limited to: ~~International~~ U.S. Oil Pollution Act 1990, as amended, which we refer to as OPA; International Convention for the Safety of Life at Sea, 1974, which we refer to as SOLAS; International Convention on Load Lines, 1966; International Convention for the Prevention of Pollution from Ships, 1973, Protocol 1978; International Convention on Civil Liability for Bunker Oil Pollution Damage, 2001; International Convention on Liability and Compensation for Damage in Connection with the Carriage of Hazardous and Noxious Substances by Sea, 1996; International Convention on Civil Liability for Oil Pollution Damage of 1969, as amended, ~~in 2000,~~ which we refer to as the CLC; International Convention on the Establishment of an International Fund for Compensation for Oil Pollution Damage, 1971; and Marine Transportation Security Act of 2002, which we refer to as the MTSA.

Government regulation of vessels, particularly in the area of environmental requirements, can be expected to become more stringent in the future and could require us to incur significant capital expenditures on our vessels to keep them in compliance, or even to scrap or sell certain vessels altogether. Compliance with such laws, regulations and standards, where applicable, may require installation of costly equipment or operational changes and may affect the resale value or useful lives of our vessels. We may also incur additional costs in order to comply with other existing and future regulatory obligations, including, but not limited to, costs relating to air emissions, the management of ballast waters, maintenance and inspection, elimination of tin-based paint, development and implementation of emergency procedures and insurance coverage or other financial assurance of our ability to address pollution incidents. These costs could have a material adverse effect on our business, results of operations, cash flows and financial condition and our ability to pay dividends.

Additional conventions, laws and regulations may be adopted that could limit our ability to do business or increase the cost of our doing business and may materially adversely affect our business, financial condition and results of operations. Because such conventions, laws and regulations are often revised, or the required additional measures for compliance are still under development, we cannot predict the ultimate cost of complying with such conventions, laws and regulations or the impact thereof on the resale prices or useful lives of our vessels. We are also required by various governmental and quasi-governmental agencies to obtain certain permits, licenses, certificates and financial assurances with respect to our operations.

These requirements can also affect the resale prices or useful lives of our vessels or require reductions in capacity, vessel modifications or operational changes or restrictions. Failure to comply with these requirements could lead to decreased availability of or more costly insurance coverage for environmental matters or result in the denial of access to certain jurisdictional waters or ports, or detention in certain ports. Under local, national and foreign laws, as well as international treaties and conventions, we could incur material liabilities, including cleanup obligations and claims for natural resource, personal injury and property damages in the event that there is a release of petroleum or other hazardous materials from our vessels or otherwise in connection with our operations. Violations of, or liabilities under, environmental regulations can result in substantial penalties, fines and other sanctions, including, in certain instances, seizure or detention of our vessels. Events of this nature would have a material adverse effect on our business, financial condition and results of operations.

The operation of our vessels is affected by the requirements set forth in the International Safety Management, or ISM, Code. The ISM Code requires shipowners, ship managers and bareboat charterers to develop and maintain an extensive “Safety Management System” that includes the adoption of a safety and environmental protection policy setting forth instructions and procedures for safe operation and describing procedures for dealing with emergencies. The failure of a shipowner or bareboat charterer to comply with the ISM Code may subject it to increased liability, may invalidate existing insurance or decrease available insurance coverage for the affected vessels and may result in a denial of access to, or detention in, certain ports. In addition, if we fail to maintain ISM Code certification for our vessels, we may also breach covenants in certain of our credit and loan facilities that require that our vessels be ISM-Code certified. If we breach such covenants due to failure to maintain ISM Code certification and are unable to remedy the relevant breach, our lenders could accelerate our indebtedness and foreclose on the vessels in our fleet securing those credit and loan facilities. As of the date of this ~~document,~~annual report on Form 20-F, each of our vessels is ISM Code-certified.

Climate change and greenhouse gas restrictions may be imposed.

Due to concern over the risk of climate change, a number of countries and the International Maritime Organization, or IMO, have adopted, or are considering the adoption of, regulatory frameworks to reduce greenhouse gas emissions. These regulatory measures may include, among others, adoption of cap and trade regimes, carbon taxes, increased efficiency standards and incentives or mandates for renewable energy. In addition, although the emissions of greenhouse gases from international shipping currently are not subject to the Kyoto Protocol to the United Nations Framework Convention on Climate Change, which required adopting countries to implement national programs to reduce emissions of certain gases, a new treaty may be adopted in the future that includes restrictions on shipping emissions. Compliance with changes in laws, regulations and obligations relating to climate change could increase our costs related to operating and maintaining our vessels and require us to install new emission controls, acquire allowances or pay taxes related to our greenhouse gas emissions, or administer and manage a greenhouse gas emissions program. Revenue generation and strategic growth opportunities may also be adversely affected.

Charterers have been placed under significant financial pressure, thereby increasing our charter counterparty risk.

The continuing weakness in demand for dry bulk shipping services and any future declines in such demand could result in financial challenges faced by our charterers and may increase the likelihood of one or more of our charterers being unable or unwilling to pay us contracted charter rates. We expect to generate most of our revenues from these charters and if our charterers fail to meet their obligations to us, we will sustain significant losses which could have a material adverse effect on our financial condition and results of operations.

Capital expenditures and other costs necessary to operate and maintain our vessels may increase.

Changes in safety or other equipment standards, as well as compliance with standards imposed by maritime self-regulatory organizations and customer requirements or competition, may require us to make additional expenditures. In order to satisfy these requirements, we may, from time to time, be required to take our vessels out of service for extended periods of time, with corresponding losses of revenues. In the future, market conditions may not justify these expenditures or enable us to operate some or all of our vessels profitably during the remainder of their economic lives.

There are inherent operational risks in the seaborne transportation industry.

The operation of any vessel includes risks such as mechanical failure, collision, fire, contact with floating objects, cargo or property loss or damage and business interruption due to political circumstances in foreign countries, piracy, terrorist attacks, armed hostilities and labor strikes. Such occurrences could result in death or injury to persons, loss of property or environmental damage, delays in the delivery of cargo, loss of revenues from or termination of charter contracts, governmental fines, penalties or restrictions on conducting business, higher insurance rates and damage to our reputation and customer relationships generally. In the past, political conflicts have also resulted in attacks on vessels, mining of waterways and other efforts to disrupt international shipping, particularly in the Arabian Gulf region. In addition, there is always the possibility of a marine disaster, including oil spills and other environmental damage.

If our vessels suffer damage, they may need to be repaired at a ~~drydocking~~dry-docking facility. The costs of ~~drydocking~~dry-docking repairs are unpredictable and may be substantial. We may have to pay ~~drydocking~~dry-docking costs that our insurance does not cover in full. The loss of earnings while these vessels are being repaired and repositioned, as well as the actual cost of these repairs, would decrease our earnings. In addition, space at ~~drydocking~~dry-docking facilities is sometimes limited and not all ~~drydocking~~dry-docking facilities are conveniently located. We may be unable to find space at a suitable ~~drydocking~~dry-docking facility or our vessels may be forced to travel to a ~~drydocking~~dry-docking facility that is not conveniently located to our vessels’ positions. The loss of earnings while these vessels are forced to wait for space or to travel to more distant ~~drydocking~~dry-docking facilities would decrease our earnings.

Our insurance may not be adequate to cover our losses that may result from our operations.

We carry insurance to protect us against most of the accident-related risks involved in the conduct of our business, including marine hull and machinery insurance, war risk insurance, protection and indemnity insurance, which includes pollution risks, crew insurance and war risk insurance. However, we may not be adequately insured to cover losses from our operational risks, which could have a material adverse effect on us. Additionally, our insurers may refuse to pay particular claims and our insurance may be voidable by the insurers if we take, or fail to take, certain action, such as failing to maintain certification of our vessels with applicable maritime regulatory organizations. Any significant uninsured or underinsured loss or liability could have a material adverse effect on our business, results of operations, cash flows and financial condition and our ability to pay dividends. It may also result in protracted legal litigation. In addition, we may not be able to obtain adequate insurance coverage at reasonable rates in the future during adverse insurance market conditions. We maintain, for each of our vessels, pollution liability coverage insurance for $1.0 billion per event. If damages from a catastrophic spill exceed our insurance coverage, it would have a materially adverse effect on our business, results of operations and financial condition and our ability to pay dividends to our shareholders.

Moreover, insurers have over the last few years increased premiums and reduced or restricted coverage for losses caused by terrorist acts generally.

In addition, we do not currently carry and may not carry loss-of-hire insurance, which covers the loss of revenue during extended vessel off-hire periods, such as those that occur during an unscheduled ~~drydocking~~dry-docking due to damage to the vessel from accidents. Accordingly, any loss of a vessel or extended vessel off-hire, due to an accident or otherwise, could have a material adverse effect on our business, results of operations, financial condition and our ability to pay dividends.

We may be subject to funding calls by our protection and indemnity clubs, and our clubs may not have enough resources to cover claims made against them.

We are indemnified for legal liabilities incurred while operating our vessels through membership of protection and indemnity, or P&I, associations, otherwise known as P&I clubs. P&I clubs are mutual insurance clubs whose members must contribute to cover losses sustained by other club members. The objective of a P&I club is to provide mutual insurance based on the aggregate tonnage of a member’s vessels entered into the club. Claims are paid through the aggregate premiums of all members of the club, although members remain subject to calls for additional funds if the aggregate premiums are insufficient to cover claims submitted to the club. Claims submitted to the club may include those incurred by members of the club, as well as claims submitted by other P&I clubs with which our club has entered into interclub agreements. We cannot assure you that the P&I club to which we belong will remain viable or that we will not become subject to additional funding calls, which could adversely affect us.

~~There are~~

We may be subject to increased inspection procedures, tighter import and export controls and new security regulations.

International shipping is subject to various security and customs inspection and related procedures in countries of origin and destination and trans-shipment points. Inspection procedures can result in the seizure of the cargo and contents of our vessels, delays in the loading, offloading or delivery and the levying of customs duties, fines or other penalties against us.

It is possible that changes to inspection procedures could impose additional financial and legal obligations on us. Furthermore, changes to inspection procedures could also impose additional costs and obligations on our customers and may, in certain cases, render the shipment of certain types of cargo impractical. Any such changes or developments may have a material adverse effect on our business, financial condition, results of operations and our ability to pay dividends.

Rising fuel prices may adversely affect our profits.

~~While we currently have no charters under which we are bearing the cost of fuel (bunkers), fuel~~

Fuel is a significant, if not the largest, expense if vessels are under voyage charter. Moreover, the cost of fuel will affect the profit we can earn on the spot market. Upon redelivery of vessels at the end of a time charter, we may be obliged to repurchase the fuel on board at prevailing market prices, which could be materially higher than fuel prices at the inception of the time charter period. As a result, an increase in the price of fuel may adversely affect our profitability. The price and supply of fuel is unpredictable and fluctuates based on events outside our control, including geopolitical events, supply and demand for oil and gas, actions by the Organization of the Petroleum Exporting Countries and other oil and gas producers, war and unrest in oil producing countries and regions, regional production patterns and environmental concerns. Further, fuel may become much more expensive in the future, which may reduce the profitability and competitiveness of our business versus other forms of transportation, such as truck or rail.

The operation of dry bulk vessels has certain unique operational risks.

The operation of certain vessel types, such as dry bulk vessels, has certain unique risks. With a dry bulk vessel, the cargo itself and its interaction with the vessel can be a risk factor. By their nature, dry bulk cargoes are often heavy, dense, easily shifted and react badly to water exposure. In addition, dry bulk vessels are often subjected to battering during unloading operations with grabs, jackhammers (to pry encrusted cargoes out of the hold) and small bulldozers. This may cause damage to the vessel. Vessels damaged due to treatment during unloading procedures may be more susceptible to breach while at sea. Hull breaches in dry bulk vessels may lead to the flooding of the vessels holds. If a dry bulk vessel suffers flooding in its forward holds, the bulk cargo may become so dense and waterlogged that its pressure may buckle the vessels bulkheads leading to the loss of a vessel. If we are unable to adequately maintain our vessels we may be unable to prevent these events. Any of these circumstances or events could negatively impact our business, financial condition, results of operations and ability to pay dividends. In addition, the loss of any of our vessels could harm our reputation as a safe and reliable vessel owner and operator.

Maritime claimants could arrest our ~~vessels, which would interrupt our business.~~

vessels.

Crew members, suppliers of goods and services to a vessel, shippers of cargo and other parties may be entitled to a maritime lien against a vessel, or other assets of the relevant vessel-owning company, for unsatisfied debts, claims or damages. In many jurisdictions, a claimant may seek to obtain security for its claim by arresting a vessel through foreclosure proceedings. The arrest or attachment of one or more of our vessels, ~~or other assets of the relevant vessel-owning company or companies,~~ could cause us to default on a charter, breach covenants in our ~~credit facility and loan agreement,~~Credit Facility, the Kelty Loan Agreement or the DVB Loan Agreement, interrupt our cash flow and require us to pay large sums of money to have the arrest or attachment lifted.

In addition, in some jurisdictions, such as South Africa, under the “sister ship” theory of liability, a claimant may arrest both the vessel which is subject to the claimant’s maritime lien and any “associated” vessel, which is any vessel owned or controlled by the same owner. Claimants could attempt to assert “sister ship” liability against one vessel in our fleet for claims relating to another of our vessels.

Governments could requisition our vessels during a period of war or emergency.

A government could requisition one or more of our vessels for title or for hire. Requisition for title occurs when a government takes control of a vessel and becomes the owner. Requisition for hire occurs when a government takes control of a vessel and effectively becomes the charterer at dictated charter rates. Generally, requisitions occur during a period of war or emergency, although governments may elect to requisition vessels in other circumstances. Even if we would be entitled to compensation in the event of a requisition of one or more of our vessels, the amount and timing of payment would be uncertain. Government requisition of one or more of our vessels may negatively impact our business, financial condition, results of operations and ability to pay dividends.

~~World~~

We may be affected by world events, ~~could affect our results of operations and financial condition~~.

such as terrorist attacks.

Terrorist attacks such as the attacks on the United States on September 11, 2001, in London on July 7, 2005 and in Mumbai on November 26, 2008, continuing conflicts and recent developments in the ~~continuing response of the United States~~Middle East and ~~others to these attacks,~~North Africa, including Egypt and Libya, as well as the threat of future terrorist attacks in the United States or elsewhere, continues to cause uncertainty in the world’s financial markets and may affect our business, operating results and financial condition. The continuing presence of United States and other armed forces in ~~Iraq and Afghanistan~~foreign countries may lead to additional acts of terrorism and armed conflict around the world, which may contribute to further economic instability in the ~~global~~world’s financial markets. These uncertainties could also adversely affect our ability to refinance our existence debt or obtain additional financing on terms acceptable to us or at all. In the past, political conflicts have also resulted in attacks on vessels, mining of waterways and other efforts to disrupt international shipping, particularly in the Arabian Gulf region. Acts of terrorism have also affected vessels. Any of these occurrences could have a material adverse impact on our operating results, revenues, costs and ability to pay dividends.

Terrorist attacks on vessels, such as the October 2002 attack on them.v. Limburg and the July 2010 alleged Al-Qaeda attack on theM. Star, both ~~very large crude carriers~~Very Large Crude Carriers not related to us, may in the future also negatively affect our operations and financial condition and directly impact our vessels or our customers. Future terrorist attacks could result in increased volatility and turmoil of the financial markets in the United States and globally. Any of these occurrences could have a material adverse impact on our operating results, revenues, costs and ability to pay dividends.

Acts of piracy on ocean-going vessels ~~have recently increased in frequency~~could adversely affect our business.

Acts of piracy have historically affected ocean-going vessels trading in regions of the world such as the South China Sea and in the Gulf of Aden off the coast of Somalia. Throughout 2008, 2009 and 2010 the frequency of piracy incidents ~~has~~ increased significantly, particularly in the Gulf of Aden off the coast of ~~Somalia.~~Somalia while declined during last half of 2011 and reaching in 2013 its lowest level since 2009. Although the frequency of sea piracy worldwide is decreasing, sea piracy incidents continue to occur, particularly in the Gulf of Aden off the coast of Somalia and increasingly in the Gulf of Guinea, with dry bulk vessels and tankers particularly vulnerable to such attacks. If these piracy attacks result in regions in which our vessels are deployed being characterized by insurers as “war risk” zones or Joint War Committee “war and strikes” listed areas, premiums payable for such coverage could increase significantly and such insurance coverage may be more difficult or impossible to obtain. One of our vessels was previously the subject of an attempted piracy attack, but it was able to evade such attack without damage to the vessel or its crew. In addition, crew costs, including employing onboard security guards, could increase in such circumstances. We may not be adequately insured to cover losses from these incidents, which could have a material adverse effect on us. In addition, detention hijacking as a result of an act of piracy against our vessels, or an increase in ~~cost,~~operating or voyage expenses, or unavailability of insurance for our vessels could have a material adverse impact on our business, financial condition, results of operations and ability to pay dividends.

~~Disruptions in world financial markets and the resulting governmental action in the United States and in other parts of the world could affect us~~.

The United States and other parts of the world are exhibiting deteriorating economic trends and have been in a recession. For example, the credit markets in the United States have experienced significant contraction, deleveraging and reduced liquidity, and the United States federal government and state governments have implemented and are considering a broad variety of governmental action and/or new regulation of the financial markets. Securities and futures markets and the credit markets are subject to comprehensive statutes, regulations and other requirements. The Securities and Exchange Commission, which we refer to as the SEC, other regulators, self-regulatory organizations and exchanges are authorized to take extraordinary actions in the event of market emergencies, and may effect changes in law or interpretations of existing laws.

A number of financial institutions have experienced serious financial difficulties and, in some cases, have entered bankruptcy proceedings or are in regulatory enforcement actions. The uncertainty surrounding the future of the credit markets in the United States and the rest of the world has resulted in reduced access to credit worldwide. As of December 31, 2010, we have total outstanding indebtedness of $96.7 million (of principal balance) under our credit facility and loan agreement.

We face risks attendant to changes in economic environments, changes in interest rates and instability in the banking and securities markets around the world, among other factors. Major market disruptions and the current adverse changes in market conditions and regulatory climate in the United States and worldwide may adversely affect our business or impair our ability to borrow amounts under our credit facility or any future financial arrangements. We cannot predict how long the current market conditions will last. However, these recent and developing economic and governmental factors, together with the concurrent decline in charter rates and vessel values, may have a material adverse effect on our results of operations, financial condition, cash flows and ability to pay dividends.

Compliance with safety and other vessel requirements imposed by classification societies may be costly.

The hull and machinery of every commercial vessel must be certified as safe and seaworthy in accordance with applicable rules and regulations, and accordingly vessels must undergo regular surveys. All of the vessels that we operate are classed by one of the major classification societies, including Nippon Kaiji Kyokai (Class NK), ~~American~~DNV GL and Bureau ~~of Shipping and Germanischer Lloyd.~~

Veritas.

Vessels must undergo annual surveys, immediate surveys and special surveys. In lieu of a special survey, a vessel’s machinery may be on a continuous survey cycle, under which the machinery would be surveyed over a five-year period. Our vessels are on special survey cycles for hull inspection and continuous survey cycles for machinery inspection. Every vessel is also required to be ~~drydocked~~dry-docked every two to three years for inspection of its underwater parts.

If any vessel does not maintain its class and/or fails any annual, intermediate or special survey, the vessel may be unable to trade between ports and may be unemployable which could trigger the violation of certain covenants in our ~~credit facility~~Credit Facility, the Kelty Loan Agreement and ~~loan agreement.~~the DVB Loan Agreement. Such an occurrence could have a material adverse impact on our business, financial condition, results of operations and ability to pay dividends.

~~We expect that a limited number of financial institutions will hold our cash including financial institutions that may be located in Greece.~~

We expect that a limited number of financial institutions will hold all of our cash, including some institutions located in Greece. Our bank accounts are with banks in Switzerland, Germany and Greece. Of the financial institutions located in Greece, some are subsidiaries of international banks and others are Greek financial institutions. We do not expect that these balances will be covered by insurance in the event of default by these financial institutions. The occurrence of such a default could have a material adverse effect on our business, financial condition, results of operations and cash flows, and we may lose part or all of our cash that we deposit with such banks.

~~Dividends paid by us may not constitute qualified dividend income eligible for a preferential rate of United States federal income taxation.~~

Unless Congress passes a law to extend the 15% preferential rate of tax on qualified dividend income, the rate of tax on qualified dividend income will increase after December 31, 2012. There can be no assurance as to whether the preferential rate of tax will be available generally if we pay a dividend before December 31, 2012, and even if the preferential rate is extended whether it would apply to dividends paid by a non-U.S. corporation such as the Company. Legislation has been previously introduced in the U.S. Congress that would deny the preferential rate of U.S. federal income tax currently imposed on qualified dividend income in certain circumstances. Some of these proposals, if enacted, may disqualify dividends from a non-U.S. corporation for the 15% preferential rate of tax on qualified dividend income.

Company Specific Risk Factors

The smuggling of drugs or other contraband onto our vessels may lead to governmental claims against us.

We expect that our vessels will call at ports where smugglers may attempt to hide drugs and other contraband on vessels, with or without the knowledge of crew members. To the extent that our vessels are found with contraband, whether inside or attached to the hull of our vessel, and whether with or without the knowledge of any of our crew, we may face governmental or other regulatory claims that could have an adverse effect on our business, results of operations, cash flows, financial condition and ability to pay dividends.

~~Risks relating to Globus~~

We may be unable to attract and retain key management personnel and other employees in the shipping industry.

Our success depends to a significant extent upon the abilities and efforts of our management team, and in particular on the experience, abilities, business relationships and efforts of our president, chief executive officer, ~~president~~chief financial officer and co-founder, George Karageorgiou. Although we have entered into an employment ~~agreements~~agreement in relation to the services of Mr. Karageorgiou, ~~and our chief financial officer, Elias Deftereos,~~ there is no guarantee that such ~~agreements~~agreement will be honored and will not be ~~terminated or honored.~~terminated. Our success will depend upon our ability to hire and retain key members of our management team and to hire new members as may be necessary. The loss of ~~any of these individuals, in particular~~ Mr. Karageorgiou could adversely affect our business prospects and financial condition. Difficulty in hiring and retaining replacement personnel could have a similar effect. We do not intend to maintain “key man” life insurance for ~~any of our senior management.~~

Mr. Karageorgiou.

Labor interruptions could disrupt our business.

Our vessels are manned by masters, officers and crews (totaling approximately 90134 as of December 31, ~~2010)~~2013). Seafarers ~~employed on~~manning the vessels in our fleet are covered by industry-wide collective bargaining agreements that set basic standards. Any labor interruptions or employment disagreements with our crew members could disrupt our operations and could have a material adverse effect on our business, results of operations, cash flows, financial condition and ability to pay dividends. We cannot assure you that collective bargaining agreements will prevent labor interruptions.

Restrictive covenants in our Credit Facility, the Kelty Loan Agreement and the DVB Loan Agreement may impose financial and other restrictions on us, and we cannot assure you that we will be able to borrow funds from future debt arrangements.

Our Credit Facility, the Kelty Loan Agreement and the DVB Loan Agreement impose operating and financial restrictions on us. These restrictions may limit our ability to, among other things:

create or permit liens on our assets;

engage in mergers or consolidations;

change the flag or classification society of our vessels;

pay dividends; and

change the management of our vessels.

These restrictions could limit our ability to finance our future operations or capital needs, make acquisitions or pursue available business opportunities. In addition, our Credit Facility, the Kelty Loan Agreement and the DVB Loan Agreement will, and future credit arrangements will likely,require us to maintain specified financial ratios and satisfy financial covenants during the remaining terms of such agreements, some of which are based upon the market value of our fleet. If the market value of our fleet declines sharply, we may not be in compliance with certain provisions of our Credit Facility, the Kelty Loan Agreement and the DVB Loan Agreement, and we may not be able to refinance our debt or obtain additional financing. The market value of dry bulk vessels is sensitive, among other things, to changes in the dry bulk charter market, with vessel values deteriorating in times when dry bulk charter rates are falling and improving when charter rates are anticipated to rise. The current low charter rates in the dry bulk market, along with the oversupply of dry bulk carriers and the prevailing difficulty in obtaining financing for vessel purchases, have adversely affected dry bulk vessel values, including the vessels in our fleet. As a result, we may not meet certain minimum asset coverage ratios and other financial ratios which are included in our loan arrangements.

In December 2012, Globus reached an agreement with Credit Suisse and DVB Bank on certain amendments and waivers to the terms of the Credit Facility and the DVB Loan Agreement, respectively, which were signed in April and March 2013, respectively. These agreements applied to the period commencing on December 28, 2012 (relating to our Credit Facility) and December 31, 2012 (relating to the DVB Loan Agreement) and ended on March 31, 2014. Please read “Item 5.B. Liquidity and Capital Resources—Indebtedness” for more information. As of December 31, 2013, we were in compliance with the covenants as amended and waived of the Credit Facility and the DVB Loan Agreement.

As of December 31, 2012, Globus was not in compliance with the security value ratio requirement of the Kelty Loan Agreement that requires the market value of the mortgaged vessel and any additional security provided, including the minimum liquidity maintained with Commerzbank, to equal or exceed 130% of the aggregate principal amount of debt outstanding under the Kelty Loan Agreement. On April 29, 2013 with reference to the Kelty Loan Agreement, the Company reached an agreement with Commerzbank and prepaid $3.0 million on June 28, 2013 to be fully compliant with the provisions of the Loan Agreement. As of December 31, 2013, we were fully compliant with the provisions of the Kelty Loan Agreement.

We expect that the market value of our fleet will be above the minimum market values required by both the covenants in effect before the waivers and the covenants as amended by the waivers of our Credit Facility and the DVB Loan Agreement and the covenants required by the Kelty Loan Agreement, in each case at least for the following twelve months. Should our time charter rate or vessel values materially decline in the future due to any of the reasons discussed in the risk factors set forth above or otherwise, we may be required to take action to reduce our debt or to act in a manner contrary to our business objectives to meet the ratios and satisfy these covenants.

Events beyond our control, including changes in the economic and business conditions in the shipping sectors in which we operate, may affect our ability to comply with these covenants. We cannot assure you that we will satisfy these requirements or that our lenders will waive any failure to do so.

If an event of default occurs under our Credit Facility, the Kelty Loan Agreement or the DVB Loan Agreement the respective lender could elect to declare the outstanding debt, together with accrued interest and other fees, to be immediately due and payable and proceed against the collateral securing that debt, which could constitute all or substantially all of our assets.

Furthermore, each of our loan arrangements contains a cross-default provision that may be triggered by a default under any of our other loans, including the unsecured credit facility with Firment Trading Limited, an affiliate of our chairman Mr. Feidakis, which we refer to as the Firment Credit Facility. A cross-default provision means that a default on one loan would result in a default on all of our other loans. Because of the presence of cross-default provisions in our secured loan arrangements, the refusal of any one lender to grant or extend a waiver could result in most of our indebtedness being accelerated even if our other secured lenders have waived covenant defaults under their respective loan arrangements. If our indebtedness is accelerated, it will be very difficult in the current financing environment for us to refinance our debt or obtain additional financing and we could lose our vessels if our lenders foreclose their liens, and our ability to conduct our business would be severely impaired.

Our discretion is limited because we may need to obtain consent from our lenders in order to engage in certain corporate actions. Our lenders’ interests may be different from ours, and we cannot guarantee that we will be able to obtain our lenders’ consent when needed. This may limit our ability to pay dividends to our shareholders, finance our future operations or pursue business opportunities.

As we expand our business, we may need to improve our operating and financial systems and will need to recruit suitable employees and crew for our vessels.

Our current operating and financial systems may not be adequate as we implement our plans to expand the size of our fleet, and our attempts to improve those systems may be ineffective. In addition, as we seek to expand our internal technical management capabilities and our fleet, we or our crewing agents may need to recruit suitable additional seafarers and shore based administrative and management personnel. We cannot guarantee that we or our crewing agents will be able to hire suitable employees or a sufficient number of employees as we expand our fleet. If we or our crewing agent encounter business or financial difficulties, we may not be able to adequately staff our vessels. If we are unable to develop and maintain effective financial and operating systems or to recruit suitable employees as we expand our fleet, our financial performance may be adversely affected and, among other things, the amount of cash available for distribution as dividends to our shareholders may be reduced or eliminated.

Recently, the limited supply of and increased demand for well-qualified crew, due to the increase in the size of the global shipping fleet, has created upward pressure on crewing costs, which we generally bear under our time and spot charters. Increases in crew costs may adversely affect our ~~profitability.~~

profitability, results of operations, cash flows, financial condition and ability to pay dividends.

We may be unable to successfully employ our vessels on long-term time charters or take advantage of favorable opportunities involving short-term or spot market charter rates.

Our strategy involves employing our vessels primarily on time charters generally with durations of between three months and ~~three~~five years. As of December 31, ~~2010, three~~2013, four of our dry bulk vessels were employed on time and bareboat charters with remaining terms of 22seven months on average (based on earliest charter expiration dates)., although currently two of our vessels are operating under time and bareboat charters. Although time charters with durations of ~~between~~ one to ~~three~~five years provide relatively steady streams of revenue, our vessels committed to such charters may not be available for rechartering or for spot market voyages when such employment would allow us to realize the benefits of comparably more favorable charter rates. In addition, in the future, we may not be able to enter into new time charters on favorable terms. The market is volatile, and in the past charter rates have declined below operating costs of vessels. If we are required to enter into a charter when charter rates are low, employ our vessels on the spot market during periods when charter rates have fallen or we are unable to take advantage of short-term opportunities on the spot or charter market, our earnings and profitability could be adversely affected. We cannot assure you that future charter rates will enable us to operate our vessels profitably or to pay dividends, or both.

Our charterers may renegotiate or default on their charters.

Our charters provide the charterer the right to terminate the charter on the occurrence of stated events or the existence of specified conditions. In addition, the ability and willingness of each of our charterers to perform its obligations under aits charter with us will depend on a number of factors that are beyond our control. These factors may include general economic conditions, the condition of the dry bulk shipping industry and the overall financial condition of the counterparties. The costs and delays associated with the default of a charterer of a vessel may be considerable and may adversely affect our business, results of operations, cash flows, financial condition and ability to pay dividends.

In the recent depressed dry bulk market conditions, there have been numerous reports of charterers renegotiating their charters or defaulting on their obligations ~~thereunder.~~under their charters. If our current charterers or a future charterer defaults on a charter, we will seek the remedies available to us, which may include arbitration or litigation to enforce the contract, although such efforts may not be successful. We cannot predict whether our charterers will, upon the expiration of their charters, recharter our vessels on favorable terms or at all. If our charterers decide not to recharter our vessels, we may not be able to recharter them on terms similar to the terms of our current charters or at all. In the future, we may also employ our dry bulk vessels on the spot charter market, which is subject to greater rate fluctuation than the time charter market. If we receive lower charter rates under replacement charters or are unable to recharter all of our vessels, this may adversely affect our business, results of operations, cash flows, financial condition and ability to pay dividends.

The aging of our fleet may result in increased operating costs in the future.

In general, the cost of maintaining a vessel in good operating condition increases with the age of the vessel. As of December 31, ~~2010,~~2013 and 2012, the weighted average age of the vessels in our current fleet was ~~4.0 years.~~7.1 and 6.1 years, respectively. As our fleet ages, we will incur increased costs. Older vessels are typically less fuel efficient and more costly to maintain than more recently constructed vessels due to improvements in engine technology. Cargo insurance rates, paid by charterers, increase with the age of a vessel, making older vessels less desirable to charterers. Governmental regulations, safety or other equipment standards related to the age of vessels may require expenditures for alterations or the addition of new equipment, to our vessels and may restrict the type of activities in which our vessels may engage. We cannot assure you that, as our vessels age, further market conditions will justify those expenditures or enable us to operate our vessels profitably during the remainder of their useful lives.

We may have difficulty managing our planned growth properly.

Any future acquisitions of additional vessels will impose additional responsibilities on our management and staff and may require us to increase the number of our personnel. In the event of a future acquisition of additional vessels, we will also have to increase our customer base to provide continued employment for the new vessels.

We intend to continue to grow our business through disciplined acquisitions of secondhand vessels that meet our selection criteria and ~~newly-built~~newly built vessels if we can negotiate attractive purchase prices. Our future growth will primarily depend on:

locating and acquiring suitable vessels;

identifying and consummating acquisitions;

enhancing our customer base;

managing our expansion; and

obtaining required financing on acceptable terms.

A delay in the delivery to us of any such vessel, or the failure of the shipyard to deliver a vessel at all, could cause us to breach our obligations under a related charter and could adversely affect our earnings. In addition, the delivery of any of these vessels with substantial defects could have similar consequences. A shipyard could fail to deliver a newbuilding on time or at all because of:

work stoppages or other hostilities or political or economic disturbances that disrupt the operations of the shipyard;

quality or engineering problems;

bankruptcy or other financial crisis of the shipyard;

a backlog of orders at the shipyard;

weather interference or catastrophic events, such as major earthquakes or fires;

our requests for changes to the original vessel specifications or disputes with the shipyard;

shortages of or delays in the receipt of necessary construction materials, such as steel; or

shortages of or delays in the receipt of necessary equipment, such as main engines, electricity generators and propellers.

In addition, if we enter a newbuilding or secondhand contract in the future, we may seek to terminate the contract due to market conditions, financing limitations or other reasons. The outcome of contract termination negotiations may require us to forego deposits on construction or purchase and pay additional cancellation fees. In addition, where we have already arranged a future charter with respect to the terminated newbuilding contract, we would need to provide an acceptable substitute vessel to the charterer to avoid breaching our charter agreement.

During periods in which charter rates are high, vessel values generally are high as well, and it may be difficult to consummate vessel acquisitions or enter into newbuilding contracts at favorable prices. During periods when charter rates are low, we may be unable to fund the acquisition of newbuildings, whether through lending or cash on hand. For these reasons, we may be unable to execute our growth plans or avoid significant expenses and losses in connection with our future growth efforts.

Growing any business by acquisition presents numerous risks, such as undisclosed liabilities and obligations, the possibility that indemnification agreements will be unenforceable or insufficient to cover potential losses and difficulties associated with imposing common standards, controls, procedures and policies, obtaining additional qualified personnel, managing relationships with customers and integrating newly acquired assets and operations into existing infrastructure. We cannot give any assurance that we will be successful in executing our growth plans or that we will not incur significant expenses and losses in connection with our future growth.

Possible new legislative or regulatory changes in Greece may adversely affect our results from operations.

Globus Shipmanagement Corp., our ship management subsidiary, who we refer to as our Manager, is regulated under Greek Law 89/67, and conducts its operations and those on our behalf primarily in Greece. Greece has been implementing new legislative measures to address financial difficulties, several of which as a response from oversight by the International Monetary Fund and by European regulatory bodies such as the European Central bank. Such legislative actions may impose new regulations on our operations in Greece that will require us to incur new or additional compliance or other administrative costs and may require that ~~Globus Shipmanagement~~our Manager or we pay to the Greek government new taxes or other fees. Any such taxes, fees or costs we incur could be in amounts that are significantly greater than those in the past and could adversely affect our results from operations.

In January 2013, a new tax law 4110/2013 amended the long-standing provisions of art. 26 of law 27/1975 by imposing a fixed annual tonnage tax on vessels flying a foreign (i.e., non-Greek) flag which are managed by a Law 89 company, establishing an identical tonnage tax regime as the one already in force for vessels flying the Greek flag. This tax varies depending on the size of the vessel, calculated in gross registered tonnage, as well as on the age of each vessel. Payment of this tonnage tax completely satisfies all income tax obligations of both the shipowning company and of all its shareholders up to the ultimate beneficial owners. Any tax payable to the state of the flag of each vessel as a result of its registration with a foreign flag registry (including the Marshall Islands) is subtracted from the amount of tonnage tax due to the Greek tax authorities.

We expect that a limited number of financial institutions will hold our cash including financial institutions that may be located in Greece.

Purchasing and operating secondhand vessels may result in increased operating costs and reduced fleet utilization.

While we have the right to inspect previously owned vessels prior to our purchase of them, such an inspection does not provide us with the same knowledge about their condition that we would have if these vessels had been built for and operated exclusively by us. A secondhand vessel may have conditions or defects that we are not aware of when we buy the vessel and which may require us to incur costly repairs to the vessel. These repairs may require us to put a vessel into ~~drydocking,~~dry-docking, which would ~~reduce~~increase cash outflows and related expenses, while reducing our fleet utilization. Furthermore, we usually do not receive the benefit of warranties on secondhand vessels.

The declaration and payment of dividends to holders of our common shares will depend on a number of factors and will always be subject to the discretion of our board of directors.

There can be no assurance that dividends will be paid to holders of our shares in any anticipated amounts and frequency at all. Our policy is, to the extent permitted by law and applicable contractual obligations, to declare and pay to holders of our shares a variable quarterly dividend in excess of 50% of the net income of the previous quarter subject to any reserves our board of directors may from time to time determine are required. However, we may incur other expenses or liabilities that would reduce or eliminate the cash available for distribution as dividends, including as a result of the risks described in this section of ~~the~~this annual report on Form 20-F. Our ~~credit facility~~Credit Facility, the Kelty Loan Agreement and ~~loan agreement~~the DVB Loan Agreement also prohibit our declaration and payment of dividends under some circumstances. Under each of our ~~credit facility~~Credit Facility, the Kelty Loan Agreement and ~~loan agreement~~the DVB Loan Agreement we will be prohibited from paying dividends if an event of default has occurred or any event has occurred or circumstance arisen which with the giving of notice or the lapse of time or the satisfaction of any other condition would constitute an event of default under our ~~credit facility~~Credit Facility, the Kelty Loan Agreement and ~~loan agreement.~~the DVB Loan Agreement. Under the terms of our agreed amendments to our Credit Facility and the DVB Loan Agreement, we were prohibited from paying dividends to our common shareholders until March 31, 2014. Please read “Item 5.B. Liquidity and Capital Resources—Indebtedness” for further information. We may also enter into new financing or other agreements that ~~will~~may restrict our ability to pay dividends.

In addition, we may pay dividends to the holders of our Series A Preferred Shares prior to the holders of our shares.

In addition, the declaration and payment of dividends to holders of our shares will be subject at all times to the discretion of our board of directors, and will be paid equally on a per-share basis between our common shares and our Class B ~~shares.~~shares, to the extent any are issued and outstanding. We can provide no assurance that dividends will be paid in the future.

There may be a high degree of variability from period to period in the amount of cash, if any, that is available for the payment of dividends based upon, among other things:

the rates we obtain from our charters as well as the rates obtained upon the expiration of our existing charters;

the level of our operating costs;

the number of unscheduled off-hire days and the timing of, and number of days required for, scheduled ~~drydocking~~dry-docking of our vessels;

vessel acquisitions and related financings;

restrictions in our ~~credit facility~~Credit Facility, Kelty Loan Agreement and ~~loan agreement~~DVB Loan Agreement and in any future debt arrangements;

our ability to obtain debt and equity financing on acceptable terms as contemplated by our growth strategy;

prevailing global and regional economic and political conditions;

the effect of governmental regulations and maritime self-regulatory organization standards on the conduct of our business;

our overall financial condition;

our cash requirements and availability;

the amount of cash reserves established by our board of directors; and

restrictions under Marshall Islands law.

Marshall Islands law generally prohibits the payment of dividends other than from surplus or net profits, or while a company is insolvent or would be rendered insolvent by the payment of such a dividend. We may not have sufficient funds, surplus or net profits to make ~~distributions available to us.~~

distributions.

We may incur expenses or liabilities or be subject to other circumstances in the future that reduce or eliminate the amount of cash that we have available for distribution as dividends, if any. Our growth strategy contemplates that we will finance the acquisition of our newbuildings or selective acquisitions of vessels through a combination of our operating cash flow and debt financing through our subsidiaries or equity financing. If financing is not available to us on acceptable terms, our board of directors may decide to finance or refinance acquisitions with a greater percentage of cash from operations to the extent available, which would reduce or even eliminate the amount of cash available for the payment of dividends. We may also enter into other agreements that will restrict our ability to pay dividends.

The amount of cash we generate from our operations may differ materially from our net income or loss for the period, which will be affected by non-cash items. We may incur other expenses or liabilities that could reduce or eliminate the cash available for distribution as dividends. As a result of these and the other factors mentioned above, we may pay dividends during periods when we record losses and may not pay dividends during periods when we record net income, if we pay dividends at all.

We may declare and pay dividends only to the holders of our Series A Preferred Shares or prior to declaring and paying any dividends to our common shareholders.

Our Series A Preferred Shares are entitled to receive dividends at the sole discretion of the Remuneration Committee. The declaration and payment of any dividend to holders of our common shares and Class B shares is also at the discretion of our board of directors. It is possible in the future that we will pay dividends only to holders of the Series A Preferred Shares or prior to the holders of our common shares and Class B shares. As a result of such potential dividend policy, the market price of our common shares could be adversely affected. Under the terms of our recently agreed amendment to our Credit Facility, we are prohibited under certain circumstances from paying dividends to the holders of our preferred shares in an amount that exceeds $500,000 per fiscal year. Please read “Item 5.B. Liquidity and Capital Resources—Indebtedness” for further information.

We are a holding company, and we will depend on the ability of our subsidiaries to distribute funds to us in order to satisfy our financial obligations or to make dividend payments.

We are a holding company and our subsidiaries, which are all directly and wholly owned by us, will conduct all of our operations and own all of our operating assets. We have no significant assets other than the equity interests in our wholly owned subsidiaries. As a result, our ability to make dividend payments depends on our subsidiaries and their ability to distribute funds to us. If we are unable to obtain funds from our subsidiaries, our board of directors may exercise its discretion not to declare or pay dividends. In addition, our subsidiaries are subject to limitations on the payment of dividends under Marshall Islands or Maltese law.

Management may be unable to provide reports as to the effectiveness of our internal control over financial reporting or our independent registered public accounting firm may be unable to provide us with unqualified attestation reports as to the effectiveness of our internal control over financial reporting.

Under Section 404 of the Sarbanes-Oxley Act of 2002, which we refer to as Sarbanes-Oxley, we ~~may be~~are required to include in each of our annual reports on Form 20-F ~~commencing for the year ended December 31, 2011~~ a report containing our management’s assessment of the effectiveness of our internal control over financial reporting and we may also be required to include, in our future annual reports, a related attestation of our independent registered public accounting firm. Our ~~manager,~~Manager, Globus Shipmanagement, will provide substantially all of our financial reporting, and we will depend on the procedures it has in place. If, in such ~~future~~ annual reports on Form 20-F, our management cannot provide a report as to the effectiveness of our internal control over financial reporting or our independent registered public accounting firm is unable to provide us with an unqualified attestation report as to the effectiveness of our internal control over financial reporting as required by Section 404, investors could lose confidence in the reliability of our financial statements, which could result in a decrease in the value of our common shares.

Unless we set aside reserves or are able to borrow funds for vessel replacement, at the end of a vessel’s useful life our revenues will decline.

As of December 31, ~~2009~~2013 and December 31, ~~2010,~~2012, the vessels in our current fleet had a weighted average age of ~~10.5~~7.1 and ~~4.0~~6.1 years, respectively. Unless we maintain reserves or are able to borrow or raise funds for vessel replacement, we will be unable to replace the vessels in our fleet upon the expiration of their remaining useful lives, which we expect to be 25 years from the date of their construction. Our cash flows and income are dependent on the revenues earned by the chartering of our vessels to customers. If we are unable to replace the vessels in our fleet upon the expiration of their useful lives, our business, results of operations, financial condition and ability to pay dividends will be materially adversely affected. Any reserves set aside for vessel replacement may not be available for dividends.

Investments in derivative instruments such as forward freight agreements could result in losses.

From time to time, we may take positions in derivative instruments including forward freight agreements, or FFAs. FFAs and other derivative instruments may be used to hedge a vessel owner’s exposure to the charter market by providing for the sale of a contracted charter rate along a specified route and period of time. Upon settlement, if the contracted charter rate is less than the average of the rates, as reported by an identified index, for the specified route and time period, the seller of the FFA is required to pay the buyer an amount equal to the difference between the contracted rate and the settlement rate, multiplied by the number of days in the specified period. Conversely, if the contracted rate is greater than the settlement rate, the buyer is required to pay the seller the settlement sum. If we take positions in FFAs or other derivative instruments and do not correctly anticipate charter rate movements over the specified route and time period, we could suffer losses in the settling or termination of the FFA. This could adversely affect our results of operations, cash flow and ability to pay dividends.

We depend upon a few significant customers for a large part of our revenues.

We derive a significant part of our revenue from a small number of customers. During the ~~year~~years ended December 31, ~~2010,~~2013, 2012 and 2011, we derived substantially all of our revenues from approximately 1518, 24 and 14 customers, respectively, and ~~a majority~~approximately 60%, 68% and 65%, respectively, of our revenues, were derived from ~~three~~four customers. If one or more of our customers that contribute to a significant part of our revenues is unable to perform under a charter with us and we are not able to find a replacement charter, or if such a customer exercises certain rights to terminate the charter, we could suffer a loss of revenues that could materially adversely affect our business, financial condition, results of operations and cash available for distribution as dividends to our shareholders.

We could lose a customer or the benefits of a time charter if, among other things:

the customer fails to make charter payments because of its financial inability, disagreements with us or otherwise;

the customer terminates the charter because of our non-performance, including failure fail to deliver the vessel within a fixed period of time, the vessel is lost or damaged beyond repair, serious deficiencies in the vessel, prolonged periods of off-hire or our default under the charter; or

the customer terminates the charter because the vessel has been subject to seizure for more than 30 days.

If we lose a key customer, we may be unable to obtain charters on comparable terms with charterers of comparable standing or we may have increased exposure to the volatile spot market, which is highly competitive and subject to significant price fluctuations. We would not receive any revenues from such a vessel while it remained unchartered, but we may be required to pay expenses necessary to maintain the vessel in proper operating condition, insure it and service any indebtedness secured by such vessel. The loss of any of our customers, time charters or vessels or a decline in payments under our charters could have a material adverse effect on our business, results of operations and financial condition and our ability to pay dividends.

We cannot assure you that we will be able to borrow amounts under our existing credit facility or future debt arrangements and restrictive covenants in our credit facility and loan agreement may impose financial and other restrictions on us.

~~Our credit facility and loan agreement impose operating and financial restrictions on us. These restrictions may limit our ability to, among other things:~~

~~create or permit liens on our assets;~~

~~engage in mergers or consolidations;~~

~~change the flag or classification society of our vessels;~~

~~pay dividends; and~~

~~change the management of our vessels.~~

These restrictions could limit our ability to finance our future operations or capital needs, make acquisitions or pursue available business opportunities. In addition, our credit facility and loan agreement will require us to maintain specified financial ratios and satisfy financial covenants during the remaining terms of such agreements, some of which are based upon the market value of our fleet. If the market value of our fleet declines sharply, we may not be in compliance with certain provisions of our credit facility and loan agreement and we may not be able to refinance our debt or obtain additional financing. We expect that the market value of our fleet will be above the minimum market values required by our credit facility and loan agreement. However, should our time charter rate or vessel values materially decline in the future due to any of the reasons discussed in the risk factors set forth above or otherwise, we may be required to take action to reduce our debt or to act in a manner contrary to our business objectives to meet these ratios and satisfy these provisions.

Events beyond our control, including changes in the economic and business conditions in the shipping sectors in which we operate, may affect our ability to comply with these covenants. We cannot assure you that we will satisfy this requirement or that our lenders will waive any failure to do so.

A breach of any of the covenants in, or our inability to maintain the required financial ratios under, our credit facility would prevent us from borrowing additional money under this facility and could result in a default under our credit facility. If a default occurs under our credit facility or loan agreement, the respective lender could elect to declare the outstanding debt, together with accrued interest and other fees, to be immediately due and payable and proceed against the collateral securing that debt, which could constitute all or substantially all of our assets.

Therefore, our discretion is limited because we may need to obtain consent from our lenders in order to engage in certain corporate actions. Our lenders’ interests may be different from ours, and we cannot guarantee that we will be able to obtain our lenders’ consent when needed. This may limit our ability to pay dividends to our shareholders, finance our future operations or pursue business opportunities.

We cannot assure you that we will be able to refinance any indebtedness incurred under our ~~credit facility and loan agreement~~Credit Facility, the Kelty Loan Agreement, the DVB Loan Agreement or the Firment Credit Facility or obtain additional debt financing.

We may finance future fleet expansion with additional secured indebtedness. While we may refinance amounts drawn under our ~~credit facility and loan agreement~~Credit Facility, the Kelty Loan Agreement, the DVB Loan Agreement or the Firment Credit Facility or secure new debt facilities with the net proceeds of future debt and equity offerings, we cannot assure you that we will be able to do so at an interest rate or on terms that are acceptable to us or at all. Our ability to obtain bank financing or to access the capital markets for future offerings may be limited by our financial condition at the time of any such financing or offering, including the actual or perceived credit quality of our charterers and the market value of our fleet, as well as by adverse market conditions resulting from, among other things, general economic conditions, weakness in the financial markets and contingencies and uncertainties that are beyond our control. Significant contraction, de-leveraging and reduced liquidity in credit markets worldwide is reducing the availability and increasing the cost of credit.

If we are not able to refinance our ~~current credit facility~~Credit Facility, the Kelty Loan Agreement, the DVB Loan Agreement and ~~loan agreement~~the Firment Credit Facility or obtain new debt financing on terms acceptable to us, we will have to dedicate a portion of our cash flow from operations to pay the principal and interest of this indebtedness. If we are not able to satisfy these obligations, we may have to undertake alternative financing plans. In addition, debt service payments under our ~~credit facility~~Credit Facility, the Kelty Loan Agreement, the DVB Loan Agreement, and ~~loan agreement~~the Firment Credit Facility or alternative financing may limit funds otherwise available for working capital, capital expenditures, the payment of dividends and other purposes. Our inability to obtain additional or replacement financing at anticipated costs or at all may materially affect our results of operation, our ability to implement our business strategy, ~~and~~ our payment of ~~dividends.~~

dividends and our ability to continue as a going concern.

The superior voting rights of our Class B shares, ~~when~~if issued, may limit our common shareholders’ ability to influence corporate matters.

Under our articles of incorporation, our Class B shares have 20 votes per share, and our common shares have one vote per share. We currently have no Class B shares outstanding, although we intend to issue in 2011 a special stock dividend of Class B shares to the holders of our common shares in a ratio of one Class B share for every number of common shares owned that we will determine in the future in connection with such dividend. We plan to issue this special stock dividend to protect the voting power of the current shareholders against future dilutions in the case of additional equity issuances.

outstanding.

Even after we issue or otherwise sell additional common shares after ~~we issue~~an issuance of Class B shares, holders of our Class B shares, depending on the number, may have substantial control and influence over our management and affairs and over all matters requiring shareholder approval, including the election of directors and significant corporate transactions, such as a merger or other sale of our company or its assets. It is possible that, because of this dual class stock structure, holders of our Class B shares will be able to control all matters submitted to our shareholders for approval even though they may own significantly less than 50% of the aggregate number of outstanding shares of our common shares and Class B shares. This potential concentrated control could limit our common shareholders’ ability to influence corporate matters and, as a result, we may take actions that our common shareholders do not view as beneficial. As a result, the market price of our common shares could be adversely affected.

Provisions of our articles of incorporation and bylaws may have anti-takeover effects.

Several provisions of our articles of incorporation, which are summarized below, may have anti-takeover effects. These provisions are intended to avoid costly takeover battles, lessen our vulnerability to a hostile change of control and enhance the ability of our board of directors to maximize shareholder value in connection with any unsolicited offer to acquire our company. However, these anti-takeover provisions could also discourage, delay or prevent the merger or acquisition of our company by means of a tender offer, a proxy contest or otherwise that a shareholder may consider in its best interest and the removal of incumbent officers and directors.

Dual Class Stock. Our dual class stock structure, which consists of common shares and Class B shares, can provide holders of our Class B shares a significant degree of control over all matters requiring shareholder approval, including the election of directors and significant corporate transactions, such as a merger or other sale of our company or its assets.

Blank Check Preferred Shares. Under the terms of our articles of incorporation, our board of directors ~~will have~~has authority, without any further vote or action by our shareholders, to issue up to 100 million shares of “blank check” preferred shares. Our board could authorize the issuance of preferred shares with voting or conversion rights that could dilute the voting power or rights of the holders of common shares. The issuance of preferred shares, while providing flexibility in connection with possible acquisitions and other corporate purposes, could, among other things, have the effect of delaying, deferring or preventing a change in control of us or the removal of our management and may harm the market price of our common shares. We intend to issue one preferred share to Mr. Feidakis or his affiliate that will provide the holder with the ability to appoint any one person to be a director, who may also be the chairman of our board of directors, for so long as such holder and his or its affiliates also hold in the aggregate at least 30% of the voting power of our shares. Such preferred share will have no voting or dividend rights.

Classified Board of Directors. Our articles of incorporation provide for the division of our board of directors into three classes of directors, with each class as nearly equal in number as possible, serving staggered, three-year terms beginning upon the expiration of the initial term for each class. Approximately one-third of our board of directors is elected each year. This classified board provision could discourage a third party from making a tender offer for our shares or attempting to obtain control of us. It could also delay shareholders who do not agree with the policies of our board of directors from removing a majority of our board of directors for up to two years.

Election of Directors. Our articles of incorporation do not provide for cumulative voting in the election of directors. Our bylaws require parties, other than the chairman of the board of directors, board of directors and shareholders holding 30% or more of the voting power of the aggregate number of our shares issued and outstanding and entitled to vote, to provide advance written notice of nominations for the election of directors. These provisions may discourage, delay or prevent the removal of incumbent officers and directors.

Advance Notice Requirements for Shareholder Proposals and Director Nominations. Our bylaws provide that shareholders, other than shareholders holding 30% or more of the voting power of the aggregate number of our shares issued and outstanding and entitled to vote, seeking to nominate candidates for election as directors or to bring business before an annual meeting of shareholders must provide timely notice of their proposal in writing to the corporate secretary. Generally, to be timely, a shareholder’s notice must be received at our principal executive offices not less than 150 days or more than 180 days prior to the first anniversary date of the immediately preceding annual meeting of shareholders. Our bylaws also specify requirements as to the form and content of a shareholder’s notice. These provisions may impede a shareholder’s ability to bring matters before an annual meeting of shareholders or make nominations for directors at an annual meeting of shareholders.

~~We may issue additional securities in the future.~~

The market price of our common shares could decline due to sales of a large number of our securities in the market, including sales of shares by our large shareholders, or the perception that these sales could occur. These sales could also make it more difficult or impossible for us to sell equity securities in the future at a time and price that we deem appropriate to raise funds through future offerings of shares.

We are subject to risk relating to exchange rate fluctuations as we generate revenues from the trading of our vessels in U.S. dollars but incur a portion of our expenses in other currencies.

We generate substantially all of our revenues from the trading of our vessels in U.S. dollars, but ~~in 2010~~during the years ended December 31, 2013 and 2012 we incurred approximately ~~22%~~15% and 23%, respectively, of our vessel operating expenses, and certain administrative expenses, in currencies other than the U.S. dollar. This difference could lead to fluctuations in net profit due to changes in the value of the U.S. dollar relative to the other currencies. Expenses incurred in foreign currencies against which the U.S. dollar falls in value can increase, decreasing our revenues. We have not hedged our currency exposure, and, as a result, our results of operations and financial condition, denominated in U.S. dollars, and our ability to pay dividends could suffer.

Increases in interest rates may cause the market price of our shares to decline.

An increase in interest rates may cause a corresponding decline in demand for equity investments in general. Any such increase in interest rates or reduction in demand for our shares resulting from other relatively more attractive investment opportunities may cause the trading price of our shares to decline.

The public market may not continue to be active and liquid enough for you to resell our common shares in the future.

The price of our common shares may be volatile and may fluctuate due to factors such as:

actual or anticipated fluctuations in our quarterly and annual results and those of other public companies in our industry;

mergers and strategic alliances in the dry bulk shipping industry;

market conditions in the ~~drybulk~~dry bulk shipping industry;

changes in government regulation;

shortfalls in our operating results from levels forecast by securities analysts;

announcements concerning us or our competitors; and

the general state of the securities market.

The dry bulk shipping industry has been highly unpredictable and volatile. The market for common shares in this industry may be equally volatile.

Our chairman of the board of directors ~~holds~~owns beneficially a majority of our total outstanding common shares, which provides control over matters on which our shareholders are entitled to vote.

As of December 31, ~~2010,~~2013, Mr. ~~Georgios~~George Feidakis, our chairman of the board of directors, beneficially owns a majority of our outstanding common shares. Please ~~see~~read “Item 7.A. Major Stockholders.” Until such time that we issue additional securities or Mr. Feidakis sells all or a portion of his common shares, Mr. Feidakis can control the outcome of matters on which our ~~shareholder~~shareholders are entitled to vote, including the election of directors and other significant corporate actions. The interests of Mr. Feidakis may be different from your interests.

We ~~or our vessel-owning subsidiaries~~ may have to pay tax on ~~United States~~U.S. source shipping income.

Under the ~~United States~~U.S. Internal Revenue Code of 1986, as amended, or the Code, 50% of the gross shipping income of a vessel-owning or chartering company that is attributable to transportation that begins or ends, but that does not both begin and end, in the United States is characterized as ~~United States~~U.S. source shipping income and such income is subject to a 4% ~~United States~~U.S. federal income tax without allowance for deductions, unless that corporation qualifies for exemption from tax under section 883 of the Code and the ~~United States~~U.S. Treasury regulations promulgated thereunder, which we refer to as the Section 883 Exemption. The eligibility of ~~our vessel-owning~~Globus Maritime and its subsidiaries to qualify for the Section 883 Exemption is determined each taxable year and is dependent on certain circumstances related to the ownership of our shares and on interpretations of existing ~~United States~~U.S. Treasury regulations, each of which could change. We can therefore give no assurance that ~~our vessel-owning subsidiaries~~we will in fact be eligible to qualify for the Section 883 Exemption for all taxable years. In addition, changes to the Code, the ~~United States~~U.S. Treasury regulations or the interpretation thereof by the ~~United States~~U.S. Internal Revenue Service, or IRS, or the courts could adversely affect the ability of ~~our~~Globus Maritime and its subsidiaries to take advantage of the Section 883 Exemption.

If ~~our subsidiaries~~we are not entitled to the Section 883 Exemption for any taxable year ~~our subsidiaries~~in which any company in the group earns U.S. source shipping income, any company earning such U.S. source shipping income, would be subject to a 4% ~~United States~~U.S. federal income tax on ~~any U.S.-source~~the gross amount of the U.S. source shipping income for the year (or an effective rate of 2% on shipping income attributable to the transportation of freight to or from the United States). The imposition of this taxation could have a negative effect on our business and ~~the business of our subsidiaries~~revenues and would result in decreased earnings available for distribution to our shareholders.

For a more complete discussion, please read the section entitled “Item 10.E. Taxation—United States Tax Considerations—United States Federal Income Taxation of the Company.”

~~United States~~

U.S. tax authorities could treat us as a “passive foreign investment ~~company.~~company,”

which could result in adverse U.S. federal income tax consequences to U.S. shareholders.

A foreign corporation will be treated as a “passive foreign investment company,” or PFIC, for U.S. federal income tax purposes if either at least 75% of its gross income for any taxable year consists of certain types of “passive income” or at least 50% of the average value of the corporation’s assets produce or are held for the production of those types of “passive income.” For purposes of these tests, “passive income” includes dividends, interest and gains from the sale or exchange of investment property and rents and royalties other than rents and royalties that are received from unrelated parties in connection with the active conduct of a trade or business. For purposes of these tests, income derived from the performance of services does not constitute “passive income.”

U.S. shareholders of a PFIC are subject to a disadvantageous U.S. federal income tax regime with respect to the income derived by the PFIC, the distributions they receive from the PFIC, and the gain, if any, they derive from the sale or other disposition of their shares in the PFIC, unless those shareholders make an election available under the Code (which election could itself have adverse consequences for such shareholders). In particular, U.S. ~~holders~~shareholders who are individuals would not be eligible for the ~~15%~~preferential tax rate on qualified ~~dividends that is in effect through December 31, 2010 (and possibly thereafter if Congress enacts legislation to extend the qualified dividend tax rate).~~dividends. Please read “Item 10.E. Taxation—United States Tax Considerations—United States Federal Income Taxation of United States Holders” for a more comprehensive discussion of the U.S. federal income tax consequences to U.S. shareholders if we are treated as a PFIC.

Based on our current operations and anticipated future operations, we believe that Globus Maritime ~~Limited will~~should not be treated as a PFIC. In this regard, we intend to treat gross income we derive or are deemed to derive from our time chartering activities as services income, rather than rental income. Accordingly, we believe that our income from our time chartering activities should not constitute “passive income,” and that the assets we own and operate in connection with the production of that income do not constitute ~~passive assets.~~

assets that produce or are held for the production of “passive income.”

There are legal uncertainties involved in this determination, because there is no direct legal authority under the PFIC rules addressing our current and projected future operations. Moreover, a ~~recent~~ case by the U.S. Court of Appeals for the Fifth Circuit held that, contrary to the position of the IRS in that case, and for purposes of a different set of rules under the Code, income received under a time charter of vessels should be treated as rental income rather than services income. If the reasoning of this case were extended to the PFIC context, the gross income we derive or are deemed to derive from our time chartering activities would be treated as rental income, and we would ~~probably~~ be a ~~PFIC.~~PFIC unless an active leasing exception applies. Although the IRS has announced that it will not follow the reasoning of this case, and that it intends to treat the income from standard industry time ~~charter~~charters as services income, no assurance can be given that a ~~United States~~U.S. court will not follow the aforementioned case. Moreover, no assurance can be given that we would not constitute a PFIC for any future taxable year if there were to be changes in our assets, income or operations.

If the IRS were to find that we are or have been a PFIC for any taxable year, our U.S. shareholders will face adverse U.S. tax consequences and information reporting obligations, as more fully described under “Item 10.E. Taxation—~~United States~~U.S. Tax Considerations—~~United States~~U.S. Federal Income Taxation of United States Holders.”

Our vessels may call on ports located in countries that are subject to sanctions and embargoes imposed by the United States or other governments.

From time to time on our charterers’ instructions, our vessels may call on ports located in countries subject to sanctions and embargoes imposed by the U.S. government and countries identified by the U.S. government as state sponsors of terrorism, such as Cuba, Iran, Sudan and Syria. The U.S. sanctions and embargo laws and regulations vary in their application, as they do not all apply to the same covered persons or proscribe the same activities, and such sanctions and embargo laws and regulations may be amended or strengthened over time. In 2010, the U.S. enacted the Comprehensive Iran Sanctions Accountability and Divestment Act, or CISADA, amended the Iran Sanctions Act. Among other things, CISADA introduces limits on the ability of companies and persons to do business or trade with Iran when such activities relate to the investment, supply or export of refined petroleum or petroleum products. In addition, in 2012, President Obama signed Executive Order 13608 which prohibits foreign persons from violating or attempting to violate, or causing a violation of any sanctions in effect against Iran or facilitating any deceptive transactions for or on behalf of any person subject to U.S. sanctions. Any persons found to be in violation of Executive Order 13608 will be deemed a foreign sanctions evader and will be banned from all contacts with the United States, including conducting business in U.S. dollars. Also in 2012, President Obama signed into law the Iran Threat Reduction and Syria Human Rights Act of 2012, or the Iran Threat Reduction Act, which created new sanctions and strengthened existing sanctions. Among other things, the Iran Threat Reduction Act intensifies existing sanctions regarding the provision of goods, services, infrastructure or technology to Iran’s petroleum or petrochemical sector. The Iran Threat Reduction Act also includes a provision requiring the President of the United States to impose five or more sanctions from Section 6(a) of the Iran Sanctions Act, as amended, on a person the President determines is a controlling beneficial owner of, or otherwise owns, operates, or controls or insures a vessel that was used to transport crude oil from Iran to another country and (1) if the person is a controlling beneficial owner of the vessel, the person had actual knowledge the vessel was so used or (2) if the person otherwise owns, operates, or controls, or insures the vessel, the person knew or should have known the vessel was so used. Such a person could be subject to a variety of sanctions, including exclusion from U.S. capital markets, exclusion from financial transactions subject to U.S. jurisdiction, and exclusion of that person’s vessels from U.S. ports for up to two years.

We are currently in compliance with these laws, and our charters contain prohibitions against our vessels calling on any ports including, among others, Cuba, Iran, Sudan, Syria or any countries in violation of United Nations or United States embargoes. There can be no assurance that we will be in compliance with these laws in the future, particularly as the scope of certain laws may be unclear and may be subject to changing interpretations. Any such violation could result in fines, penalties or other sanctions that could severely impact our ability to access U.S. capital markets and conduct our business, and could result in some investors deciding, or being required, to divest their interest, or not to invest, in us. In addition, certain institutional investors may have investment policies or restrictions that prevent them from holding securities of companies that have contracts with countries identified by the U.S. government as state sponsors of terrorism. The determination by these investors not to invest in, or to divest from, our common shares may adversely affect the price at which our common shares trade. Moreover, our charterers may violate applicable sanctions and embargo laws and regulations as a result of actions that do not involve us or our vessels, and those violations could in turn negatively affect our reputation. In addition, our reputation and the market for our securities may be adversely affected if we engage in certain other activities, such as entering into charters with individuals or entities in countries subject to U.S. sanctions and embargo laws that are not controlled by the governments of those countries, or engaging in operations associated with those countries pursuant to contracts with third parties that are unrelated to those countries or entities controlled by their governments.

We are subject to Marshall Islands corporation law, which is not well-developed.

Our corporate affairs are governed by our articles of incorporation, our bylaws and by the Marshall Islands Business Corporations Act, or the BCA. The provisions of the BCA resemble provisions of the corporation laws of a number of states in the United States. However, there have been few judicial cases in the Marshall Islands interpreting the BCA. The rights and fiduciary responsibilities of directors under the laws of the Marshall Islands are not as clearly established as the rights and fiduciary responsibilities of directors under statutes or judicial precedent in existence in certain United States jurisdictions. The rights of shareholders of companies incorporated in or redomiciled into the Marshall Islands may differ from the rights of shareholders of companies incorporated in the United States. While the BCA provides that it is to be ~~interpreted~~applied and construed according to the laws of the State of Delaware and other states with substantially similar legislative provisions, there have been few ~~if any,~~ court cases interpreting the BCA in the Marshall Islands and we cannot predict whether Marshall Islands courts would reach the same conclusions as United States courts. Thus, you may have more difficulty in protecting your interests in the face of actions by our management, directors or controlling shareholders than would shareholders of a corporation incorporated in a United States jurisdiction that has developed a more substantial body of case law in the corporate law area.

It may be difficult to serve us with legal process or enforce judgments against us, our directors or our management.

Our business is operated primarily from our offices in Greece. In addition, a majority of our directors and officers are non-residents of the United States, and all of our assets and a substantial portion of the assets of these non-residents are located outside the United States. As a result, it may be difficult or impossible for you to bring an action against us or against these individuals in the United States if you believe that your rights have been infringed under securities laws or otherwise. You may also have difficulty enforcing, both within and outside of the United States, judgments you may obtain in the United States courts against us or these persons in any action, including actions based upon the civil liability provisions of United States federal or state securities laws. There is also substantial doubt that the courts of the Marshall Islands or Greece would enter judgments in original actions brought in those courts predicated on United States federal or state securities laws.

The nature of our operations may make the outcome of any bankruptcy proceedings difficult to predict.

We redomiciled into the Marshall Islands ~~on November 24, 2010,~~ and our subsidiaries are incorporated under the laws of the Marshall Islands ~~and~~or Malta, we have limited operations in the United States and we maintain limited assets in the United States. Consequently, in the event of any bankruptcy, insolvency, liquidation, dissolution, reorganization or similar proceeding involving us or any of our subsidiaries, bankruptcy laws other than those of the United States could apply. Marshall Islands does not have a bankruptcy statute or general statutory mechanism for insolvency proceedings. If we become a debtor under U.S. bankruptcy law, bankruptcy courts in the United States may seek to assert jurisdiction over all of our assets, wherever located, including property situated in other countries. There can be no assurance, however, that we would become a debtor in the United States, or that a U.S. bankruptcy court would be entitled to, or accept, jurisdiction over such a bankruptcy case, or that courts in other countries that have jurisdiction over us and our operations would recognize a U.S. bankruptcy court’s jurisdiction if any other bankruptcy court would determine it had jurisdiction. These factors may delay or prevent us from entering bankruptcy in the United States and may affect the ability of our shareholders to receive any recovery following our bankruptcy.

The Public Company Accounting Oversight Board, or PCAOB, is currently unable to inspect the audit work and practices of auditors operating in Greece, including our auditor.

Auditors of public companies incorporated in states of the United States are required by law to undergo periodic PCAOB inspections that assess their compliance with U.S. law and professional standards in connection with performance of audits of financial statements filed with the SEC. Certain European Union, or EU, countries do not permit the PCAOB to conduct inspections of accounting firms established and operating in EU countries, even if they are part of major international firms. Accordingly, unlike for most U.S. public companies, the PCAOB is prevented from evaluating our auditor’s performance of audits and its quality control procedures, and, unlike the shareholders of most public companies incorporated in states of the United States, our shareholders are deprived of the possible benefits of such inspections.

We may be adversely affected by the introduction of new accounting rules for leasing.

International and U.S. accounting standard-setting boards (the International Accounting Standards Board IASB and the Financial Accounting Standards Board, or FASB) have issued new exposure drafts in their joint project that would require lessees to record most leases on their balance sheets as lease assets and liabilities. Entities would still class classify leases, but classification would be based on different criteria and would serve a different purpose than it does today. Lease classification would determine how entities recognize lease-related revenue and expense, as well as what lessor’s record on the balance sheet. Classification would be based on the portion of the economic benefits of the underlying asset expected to be consumed by the lessee over the lease term. Financial statement metrics such as leverage and capital ratios, as well as EBITDA (which is not a recognized measurement under IFRS), may also be affected, even when cash flow and business activity have not changed. This may in turn affect covenant calculations under various contracts (including loan agreements) unless the affected contracts are modified. The IASB’s and FASB’s redeliberation of certain topics is expected to extend through much of 2014 and an effective date has not yet been determined. Accordingly, the timing and ultimate effect of those proposals on the Company and its shareholders is uncertain.

We, or our large shareholders, may sell additional securities in the future.

We may issue additional common shares, including Class B shares, or other equity securities without your approval.

We may issue additional common shares, including Class B shares, or other equity securities of equal or senior rank in the future in connection with, among other things, future vessel acquisitions, repayment of outstanding indebtedness or our equity incentive plan, without shareholder approval, in a number of circumstances. For example, in April 2012, we issued 3,347 Series A Preferred Shares, and 2,567 of these shares remain outstanding.

Our issuance of additional common shares, including Class B shares, or other equity securities of equal or senior rank would have the following effects:

	Ø	our existing shareholders’ proportionate ownership interest in us will decrease;

	Ø	the amount of cash available for dividends payable on our common shares may decrease;

	Ø	the relative voting strength of each previously outstanding share may be diminished; and

	Ø	the market price of our common shares may decline.

Item 4. Information on the Company

A. History and Development of the Company

We originally incorporated as Globus Maritime Limited on July 26, 2006 pursuant to the Companies (Jersey) Law 1991 (as amended), and began operations in September 2006. Following the conclusion of our initial public offering on June 1, 2007, our common shares were listed on the London Stock Exchange’s Alternative Investment Market, or AIM, under the ticker “GLBS.L.” On July 29, 2010, we effected a one-for-four reverse stock split, with our issued share capital resulting in 7,240,852 common shares of $0.004 each.

On November 24, 2010, we redomiciled into the ~~Republic of The~~ Marshall Islands pursuant to the ~~Marshall Islands Business Corporations Act~~BCA and a resale registration statement for our common shares was declared effective by the SEC. Because of the number of U.S. publicly traded shipping companies that are incorporated, formed or redomiciled in the Marshall Islands, we believed that a redomiciliation into the Marshall Islands would facilitate investors’ understanding of our company and corporate governance. Once the resale registration statement was declared effective by the SEC, our common shares began trading on the Nasdaq Global Market under the ticker “GLBS.” Our common shares were suspended from trading on the AIM on November 24, 2010 and were delisted from the AIM on November 26, 2010.

On June 30, 2011, we completed a follow-on public offering in the United States under the Securities Act of 1933, as amended, which we refer to as the Securities Act, of 2,750,000 common shares at a price of $8.00 per share, the net proceeds of which amounted to approximately $20 million.

As of ~~March 25, 2011,~~December 31, 2013, our issued and outstanding capital stock consisted of ~~7,289,688~~10,227,358 common ~~shares.~~

shares and 2,567 Series A Preferred Shares.

Our executive office is located at the office of Globus Shipmanagement Corp., who we refer to as our Manager, at 128 Vouliagmenis Avenue, 3rd Floor, 166 74 Glyfada, Athens, Greece. Our telephone number is +30 210 960 8300. Our registered agent in the Marshall Islands is The Trust Company of the Marshall Islands, Inc. and our registered address in the Marshall Islands is Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH96960. We maintain our website at www.globusmaritime.gr. Information that is available on or accessed through our website does not constitute part of, and is not incorporated by reference into, this annual report on Form 20-F.

As of December 31, 2009, our fleet comprised a total of four dry bulk vessels, consisting of two Handymaxes, one Supramax and one Panamax, with a weighted average age of approximately 10.5 years and a total carrying capacity of 212,915 dwt.

In February 2010, we sold both Handymax vessels, them/v Sea Globe and them/v Coral Globe, for an aggregate total selling price of $34.0 million. In May 2010, we purchased two sister ships, them/v Sky Globe andm/v Star Globe, for a total purchase price of approximately $65.7 million. In June 2010, we purchased one Kamsarmax vessel, them/v Jin Star, for $41.1 million.

As of December 31, 2010, our fleet comprised a total of five dry bulk vessels, consisting of one Panamax, three Supramaxes and one Kamsarmax, with a weighted average age of approximately 4.0 years and a total carrying capacity of ~~319,913~~319,664 dwt.

In March 2011, we ~~entered into~~purchased a ~~memorandum of agreement with an unaffiliated third party~~2007-built Supramax vessel for ~~subject to certain conditions, the acquisition of a 58,790 dwt dry bulk carrier built in 2007 by the Tsuneishi Heavy Industries Cebu shipyard for a purchase price of~~ $30.3 million. The vessel ~~is expected to be~~was delivered ~~during the third quarter~~in September 2011 and was named “Sun Globe.” In May 2011, we purchased a 2005-built Panamax vessel for $31.4 million. The vessel was delivered in June 2011 and was named “Moon Globe.”

As of ~~2011. In addition, the vessel will be acquired~~December 31, 2013 and 2012 our fleet comprised a total of seven dry bulk vessels, consisting of two Panamax, four Supramaxes and one Kamsarmax, with a ~~time charter agreement attached at a gross daily rate~~weighted average age of ~~$16,000 that is expected to terminate in the first quarter of 2015. Upon completion of this acquisition, we expect that our fleet will have~~approximately 7.1 and 6.1 years, respectively, and a total carrying capacity of ~~378,703 dwt and a weighted average age of 4.6 years as of September 30, 2011.~~

~~All the vessels that we purchased and sold since we began our operations in 2006 were purchased from and sold to unaffiliated third parties.~~

452,886 dwt.

Our capital expenditures, which principally consist of purchasing, operating and maintaining dry bulk vessels, for the previous three fiscal years, consisted of ~~drydocking costs. We did not incur any drydocking costs in 2010. We paid drydocking~~deferred dry-docking costs of ~~$1.1~~$0.8 million in ~~2009~~2013, deferred dry-docking costs of $0.9 million and vessels improvement costs of ~~$2.8~~$0.3 million in ~~2008.~~

2012, and deferred dry-docking costs of $0.5 million and $62.0 million with reference to the acquisition ofm/v Sun Globe andm/v Moon Globe in 2011.

B. Business Overview

We are an integrated dry bulk shipping company, providing marine transportation services on a worldwide basis. We own, operate and manage a fleet of dry bulk vessels that transport iron ore, coal, grain, steel products, cement, alumina and other dry bulk cargoes internationally. We intend to grow our fleet through timely and selective acquisitions of modern vessels in a manner that we believe will provide an attractive return on equity and will be accretive to our earnings and cash flow based on anticipated market rates at the time of purchase. There is no guarantee however, that we will be able to find suitable vessels to purchase or that such vessels will provide an attractive return on equity or be accretive to our earnings and cash flow.

Our operations are managed by our Athens, Greece-based wholly owned subsidiary, Globus Shipmanagement ~~which~~Corp.,who we refer to as our Manager, who provides in-house commercial and technical management exclusively for our vessels. ~~Globus Shipmanagement~~Our Manager enters into a ship management agreement with each of our wholly owned vessel-owning subsidiaries to provide services that include managing day-to-day vessel operations, such as supervising the crewing, supplying, maintaining of vessels and other services.

The following table presents information concerning our vessels.

Vessel
Year
Built
Flag
Direct
Owner
Shipyard Vessel Type
Delivery
Date

Carrying
Capacity
(dwt)
m/v Tiara
Globe
1998 Marshall Islands Elysium Maritime Limited Hudong Zhonghua Panamax December 2007 72,928
m/v River Globe 2007 Marshall Islands Devocean Maritime Ltd. Yangzhou Dayang Supramax December 2007 53,627
m/v Sky Globe 2009 Marshall Islands Domina Maritime Ltd. Taizhou Kouan Supramax May 2010 56,785
m/v Star Globe 2010 Marshall Islands Dulac Maritime S.A. Taizhou Kouan Supramax May 2010 56,785
m/v Jin Star 2010 Panama Kelty Marine Ltd. Jiangsu Eastern Kamsarmax June 2010 79,788

Total: 319,913

Vessel

Year
Built

Flag

Direct
Owner

Shipyard

Vessel Type

Delivery
Date

Carrying
Capacity
(dwt)

m/v Tiara Globe

1998

Marshall Islands

Elysium Maritime Limited

Hudong Zhonghua

Panamax

December 2007

72,928

m/v River Globe

2007

Marshall Islands

Devocean Maritime Ltd.

Yangzhou Dayang

Supramax

December 2007

53,627

m/v Sky Globe

2009

Marshall Islands

Domina Maritime Ltd.

Taizhou Kouan

Supramax

May 2010

56,855

m/v Star Globe

2010

Marshall Islands

Dulac Maritime S.A.

Taizhou Kouan

Supramax

May 2010

56,867

m/v Jin Star

2010

Panama

Kelty Marine Ltd.

Jiangsu Eastern

Kamsarmax

June 2010

79,387

m/v Moon Globe

2005

Marshall Islands

Artfull Shipholding S.A.

Hudong-Zhonghua

Panamax

June 2011

74,432

m/v Sun Globe

2007

Malta

Longevity Maritime Limited

Tsuneishi Cebu

Supramax

September 2011

58,790

Total:

452,886

We own each of our vessels through separate, wholly owned subsidiaries, ~~all~~six of which are incorporated in the Marshall ~~Islands. The~~Islands, and one of which is incorporated in Malta. One of the Panamax ~~vessel~~vessels and all of our Supramax vessels are geared. Geared vessels can operate in ports with minimal shore-side infrastructure. Due to the ability to switch between various dry bulk cargo types and to service a wider variety of ports, the day rates for geared vessels tend to have a premium.

We budget 20 days per ~~drydocking~~dry-docking per vessel. Actual length will vary based on the condition of each vessel, shipyard schedules and other factors.

Employment of our Vessels

Our ~~policy~~strategy is to employ ~~the majority of~~ our vessels on ~~period~~a mix of all types of charter contracts, including bareboat charters, time charters ~~with durations of up to three years, while also employing a small number of our vessels on the~~and spot ~~market.~~charters. We believe ~~our chartering~~this strategy provides the cash flow stability, reduced exposure to market downturns and high utilization rates ~~while reducing our potential exposure to a~~of the charter market, ~~downturn, and~~while at the same time ~~exposing~~enabling us to ~~the potential revenues that can be generated on the~~benefit from periods of increasing spot ~~market.~~market rates. We may, however, seek to employ a greater portion of our fleet on the spot market or on time charters with longer durations, should we believe it to be in our best interests. In addition, we seek to stagger the expiration dates of our charters to reduce exposure to volatility in the shipping cycle when our vessels come off of charter. We also continually monitor developments in the dry bulk shipping industry and, subject to market demand, will adjust the number of vessels on charters and the charter periods for our vessels according to market conditions.

We and ~~Globus Shipmanagement~~our Manager have developed relationships with a number of international charterers, vessel brokers, financial institutions, insurers and shipbuilders. We have also developed a network of relationships with vessel brokers who help facilitate vessel charters and acquisitions.

The following table presents information concerning the current employment of our vessels.

Vessel Charterer
Date
Charter
Began
Term of Charter
Charter
Expiration
Date
(Earliest)

Charter
Type

Charter
Rate (per
day)(1)

m/v Tiara Globe Transgrain Shipping February 2010 Minimum of 24 months (maximum of 26 months) January 2012(2) Time charter $ 20,000
m/v River Globe Spot n/a n/a n/a Spot n/a
m/v Sky Globe Spot n/a n/a n/a Spot n/a
m/v Star Globe Transgrain Shipping May 2010 11 months (maximum 13 months) April 2011 Time charter $ 22,000
m/v Jin Star Eastern Media International and Far Eastern Silo & Shipping June 2010 Five years(3) Jan 2015 Bareboat $ 14,250

Vessel

Charterer

Date
Charter
Began

Term of Charter

Charter
Expiration
Date
(Earliest)

Charter
Type

Charter Rate (per
day)(1)

m/v Tiara Globe

Spot

n/a

Spot

n/a

m/v River Globe

Spot

n/a

Spot

n/a

m/v Sky Globe

Spot

n/a

Spot

n/a

m/v Star Globe

Spot

n/a

Spot

n/a

m/v Jin Star

Eastern Media International and Far Eastern Silo & Shipping

June 2010

56 months(2)

January 2015

Bareboat

14,250

m/v Moon Globe

Spot

n/a

Spot

n/a

m/v Sun Globe

COSCO Qingdao Ocean Shipping Co

September 2011

Minimum of 40 months (maximum of 42 months)

January 2015

Time

16,000

(1) This table shows gross rates and does not reflect any commissions ~~payable.~~

payable unless otherwise stated.

(2) ~~The time charter contains a provision that allows for redelivery plus or minus 15 days.~~

~~(3)~~ Upon ~~the~~ expiration, ~~of the five year term,~~ the charter can be extended for one year at the charterer’s option, and thereafter extended one additional year at our option.

Each of our vessels travels across the world and not on any particular route. The charterers of our vessels, whether time, bareboat or on the spot market, select the locations to which our vessels travel.

Time Charter

A time charter is a contract for the use of a vessel for a fixed period of time at a specified daily rate. Under a time charter, the vessel owner provides crewing, insuring, repairing and maintenance and other services related to the vessel’s operation, the cost of which is included in the daily rate, and the customer is responsible for substantially all of the vessel voyage costs, including the cost of bunkers (fuel oil) and canal and port charges. The owner also pays commissions typically ranging from 0% to 6.25% of the total daily charter hire rate of each charter to unaffiliated ship brokers and to in-house brokers associated with the charterer, depending on the number of brokers involved with arranging the charter. ~~Two~~One of the vessels in our fleet ~~are~~is hired out under time ~~charters,~~charter, and we intend to continue to hire out our vessels under time charters in the future.

Basic Hire Rate and Term

“Basic hire rate” refers to the basic payment from the customer for the use of the vessel. The hire rate is generally payable semi-monthly or 15 days, in advance, in U.S. dollars as specified in the charter. The following chart discloses when such vessels are contracted to be redelivered to us at the end of the charter period.

Vessel Name	Earliest Anticipated Redelivery Date
m/v ~~Tiara~~Sun Globe	January ~~2012(1)~~
~~m/v Star Globe~~	~~April 2011~~2015

~~(1) The time charter contains a provision that allows for redelivery plus or minus 15 days.~~

Off-hire

When the vessel is “off-hire,” the charterer generally is not required to pay the basic hire rate, and we are responsible for all costs. Prolonged off-hire may lead to vessel substitution or termination of the time charter. A vessel generally will be deemed off-hire if there is a loss of time due to, among other things, operational deficiencies; ~~drydocking~~dry-docking for examination or painting the bottom; equipment breakdowns; damages to the hull; or similar problems. ~~The charterers for the~~ ~~m/v Tiara Globe~~ ~~and the~~ ~~m/v Star Globe~~ ~~have the option to extend the charter for the number of days that the vessel was off-hire.~~

Ship Management and Maintenance

We are responsible for the technical management of the vessel and for maintaining the vessel, periodic ~~drydocking,~~dry-docking, cleaning and painting and performing work required by regulations. Globus Shipmanagement provides the technical, commercial and day-to-day operational management of our vessels. Technical management includes crewing, maintenance, repair and ~~drydockings.~~dry-dockings. We pay Globus Shipmanagement $700 per vessel per day. All fees payable to Globus Shipmanagement are eliminated upon consolidation of our accounts.

Termination

We are generally entitled to suspend performance under the time charter if the customer defaults in its payment obligations. Either party may terminate the charter in the event of war in specified countries.

Commissions

During ~~2010,~~the year ended December 31, 2013, we paid commissions ranging from 5%0% to 6.25% relevant to each time charter ~~agreement.~~

agreement then in effect.

Bareboat Charter

A bareboat charter is a contract pursuant to which the vessel owner provides the vessel to the charterer for a fixed period of time at a specified daily rate, and the charterer provides for all of the vessel’s operating expenses including crewing, repairs, maintenance, insurance, stores, lube oils and communication expenses in addition to the voyage costs, and generally assumes all risk of operation. The charterer undertakes to maintain the vessel in a good state of repair and efficient operating condition and ~~drydock~~dry-dock the vessel during this period as per the classification society requirements. We have bareboat chartered them/v Jin Star to Eastern Media International Corporation and Far Eastern Silo & Shipping (Panama) S.A.

Basic Hire Rate and Term

Our bareboat charter commenced upon the vessel’s delivery for a ~~five year~~56 month term at a rate of $14,250 per day. Our bareboat charter includes an option to extend the charter’s term for one additional year at the charterer’s option. After such one year extension, we can extend the charter for one additional year.

Redelivery

Upon the expiration of the bareboat charter, the charterer is required to redeliver the vessel in as good structure, state, condition and class as that in which the vessel was delivered, fair wear and tear not affecting class excepted.

Ship Management and Maintenance

Under the bareboat charter, the charterer is responsible for crewing, insuring, maintaining and repairing the vessel including any ~~drydocking~~dry-docking as well as for all other operating costs with respect to the vessel. The charterer will cover the costs associated with the vessel’s special surveys and related ~~drydocking~~dry-docking falling within the charter period.

Termination

We have the right to terminate the charter if the charterer fails (following a short grace period in which the charterer may have an opportunity to cure) to make punctual hire payments, to insure the vessel or to maintain and/or repair the vessel as agreed.

Either party may terminate the charter in the event of war. The charterer may also terminate the charter if the charterer is deprived of ownership of the vessel for 14 days. In addition, the bareboat charter terminates automatically upon a total or constructive loss of the vessel.

Commissions

We pay a 3.75% commission on our bareboat charter.

Our Customers

We seek to charter our vessels to customers who we perceive as creditworthy thereby minimizing the risk of default by our charterers. We also try to select charterers depending on the type of product they want to carry and the geographical areas in which they tend to trade.

Our assessment of a charterer’s financial condition and reliability is an important factor in negotiating employment for our vessels. We generally charter our vessels to operators, trading houses (including commodities traders), shipping companies and producers and government-owned entities and generally avoid chartering our vessels to companies we believe to be speculative or undercapitalized entities. Since our operations began in September 2006, our customers have included COSCO Bulk Carrier Co., Ltd, Dampskibsselskabet NORDEN A/S, ED & F Man Shipping Limited, ~~STX Pan Ocean~~Transgrain, Far Eastern Silo and Shipping (Panama) S.A., and Hyundai Merchant Marine Co.~~, Ltd, Transgrain, and Korea Line Corporation.~~ Ltd. In addition, during the periods when some of our vessels were trading on the spot market, they have been chartered to charterers such as Cargill International SA, Oldendorff Carriers GmbH & Co. KG, Western Bulk Carriers KS and others, thus expanding our customer base.

Competition

Our business fluctuates in line with the main patterns of trade of the major dry bulk cargoes and varies according to changes in the supply and demand for these items. We operate in markets that are highly competitive and based primarily on supply and demand. We compete for charters on the basis of price, vessel location, size, age and condition of the vessel, as well as on our reputation as an owner and operator. We compete with other owners of dry bulk vessels in the Panamax, Supramax and Kamsarmax dry bulk vessels, but we also compete with owners for the purchase and sale of vessels of all sizes.

Ownership of dry bulk vessels is highly fragmented. It is likely that we will face substantial competition for long-term charter business from a number of experienced companies. Many of these competitors will have larger dry bulk vessel fleets and greater financial resources than us, which may make them more competitive. It is also likely that we will face increased numbers of competitors entering into our transportation sectors, including in the dry bulk sector. Many of these competitors have strong reputations and extensive resources and experience. Increased competition may cause greater price competition, especially for long-term charters. We believe that no single competitor has a dominant position in the markets in which we compete.

The process for obtaining longer term time charters generally involves a lengthy and intensive screening and vetting process and the submission of competitive bids. In addition to the quality and suitability of the vessel, longer term shipping contracts may be awarded based upon a variety of other factors relating to the vessel operator, including:

environmental, health and safety record;

compliance with regulatory industry standards;

reputation for customer service, technical and operating expertise;

shipping experience and quality of vessel operations, including cost-effectiveness;

quality, experience and technical capability of crews;

the ability to finance vessels at competitive rates and overall financial stability;

relationships with shipyards and the ability to obtain suitable berths;

construction management experience, including the ability to procure on-time delivery of new vessels according to customer specifications;

willingness to accept operational risks pursuant to the charter, such as allowing termination of the charter for force majeure events; and

competitiveness of the bid in terms of overall price.

As a result of these factors, we may be unable to expand our relationships with existing customers or obtain new customers for long-term time charters on a profitable basis, if at all. However, even if we are successful in employing our vessels under longer term charters, our vessels will not be available for trading on the spot market during an upturn in the market cycle, when spot trading may be more profitable. If we cannot successfully employ our vessels in profitable charters, our results of operations and operating cash flow could be materially adversely affected.

The Dry Bulk Shipping Industry

The world dry bulk fleet is generally divided into six major categories, based on a vessel’s cargo carrying capacity. These categories consist of: Handysize, Handymax/Supramax, Panamax, ~~Post Panamax,~~Kamsarmax, Capesize and Very Large Ore Carrier.

ØHandysize.Handysize vessels have a carrying capacity of up to 39,999 dwt. These vessels are primarily involved in carrying minor bulk cargoes. Increasingly, vessels of this type operate on regional trading routes, and may serve as trans-shipment feeders for larger vessels. Handysize vessels are well suited for small ports with length and draft restrictions. Their cargo gear enables them to service ports lacking the infrastructure for cargo loading and unloading.

ØHandymax/Supramax. Handymax vessels have a carrying capacity of between 40,000 and 59,999 dwt. These vessels operate on a large number of geographically dispersed global trade routes, carrying primarily iron ore, coal, grains and minor bulks. Within the Handymax category there is also a sub-sector known asSupramax. Supramax bulk vessels are vessels between 50,000 to 59,999 dwt, normally offering cargo loading and unloading flexibility with on-board cranes, while at the same time possessing the cargo carrying capability approaching conventional Panamax bulk vessels. Hence, the earnings potential of a Supramax dry bulk vessel, when compared to a conventional Handymax vessel of 45,000 dwt, is greater.

ØPanamax. Panamax vessels have a carrying capacity of between 60,000 and 79,999 dwt. These vessels carry coal, grains, and, to a lesser extent, minor bulks, including steel products, forest products and fertilizers. Panamax vessels are able to pass through the Panama Canal, making them more versatile than larger vessels.

Ø~~Post Panamax~~. ~~(also~~Kamsarmax(also known as ~~Kamsarmax)~~Post Panamax). ~~Post Panamax~~Kamsarmax vessels typically have a carrying capacity of between 80,000 and 109,999 dwt. These vessels tend to be shallower and have a larger beam than a standard Panamax vessel with a higher cubic capacity. They have been designed specifically for loading high cubic cargoes from draught restricted ports. This type of vessel cannot transit the Panama Canal. The term Kamsarmax stems from Port Kamsar in Guinea, where large quantities of bauxite are exported from a port with only 13.5 meter draught and a 229 meter length overall restriction, but no beam restriction.

ØCapesize. Capesize vessels have carrying capacities of between 110,000 and 199,999 dwt. Only the largest ports around the world possess the infrastructure to accommodate vessels of this size. Capesize vessels are mainly used to transport iron ore or coal and, to a lesser extent, grains, primarily on long-haul routes.

ØVLOC. Very large ore carriers are in excess of 200,000 dwt and are a comparatively new sector of the dry bulk vessel fleet. VLOCs are built to exploit economies of scale on long-haul iron ore routes.

The supply of dry bulk shipping capacity, measured by the amount of suitable vessel tonnage available to carry cargo, is determined by the size of the existing worldwide dry bulk fleet, the number of new vessels on order, the scrapping of older vessels and the number of vessels out of active service (i.e., laid up or otherwise not available for hire). In addition to prevailing and anticipated freight rates, factors that affect the rate of newbuilding, scrapping and laying-up include newbuilding prices, secondhand vessel values in relation to scrap prices, costs of bunkers and other voyage expenses, costs associated with classification society surveys, normal maintenance and insurance coverage, the efficiency and age profile of the existing fleets in the market and government and industry regulation of marine transportation practices. The supply of dry bulk vessels is not only a result of the number of vessels in service, but also the operating efficiency of the fleet. Dry bulk trade is influenced by the underlying demand for the dry bulk commodities which, in turn, is influenced by the level of worldwide economic activity. Generally, growth in gross domestic product and industrial production correlate with peaks in demand for marine dry bulk transportation services.

Dry bulk vessels are one of the most versatile elements of the global shipping fleet in terms of employment alternatives. They seldom operate on round trip voyages with high ballasting times. Rather, they often participate in triangular or multi-leg voyages.

Charter Rates

In the time charter market, rates vary depending on the length of the charter period and vessel specific factors such as age, speed, size and fuel consumption. In the voyage charter market, rates are influenced by cargo size, commodity, port dues and canal transit fees, as well as delivery and redelivery regions. In general, a larger cargo size is quoted at a lower rate per ton than a smaller cargo size. Routes with costly ports or canals generally command higher rates. Voyages loading from a port where vessels usually discharge cargo, or discharging from a port where vessels usually load cargo, are generally quoted at lower rates. This is because such voyages generally increase vessel efficiency by reducing the unloaded portion (or ballast leg) that is included in the calculation of the return charter to a loading area.

Within the dry bulk shipping industry, the freight rate indices issued by the Baltic Exchange in London are the references most likely to be monitored. These references are based on actual charter hire rates under charters entered into by market participants as well as daily assessments provided to the Baltic Exchange by a panel of major shipbrokers. The Baltic Exchange, an independent organization comprised of shipbrokers, shipping companies and other shipping players, provides daily independent shipping market information and has created freight rate indices reflecting the average freight rates (that incorporate actual business concluded as well as daily assessments provided to the exchange by a panel of independent shipbrokers) for the major bulk vessel trading routes. These indices include the Baltic Panamax Index, the index with the longest history and, more recently, the Baltic Capesize Index.

Charter (or hire) rates paid for dry bulk vessels are generally a function of the underlying balance between vessel supply and demand. Over the past 25 years, dry bulk cargo charter rates have passed through cyclical phases and changes in vessel supply and demand have created a pattern of rate “peaks” and ~~“troughs,~~“troughs.” ~~which can been from the chart above.~~ Generally, spot/voyage charter rates will be more volatile than time charter rates, as they reflect short term movements in demand and market sentiment. The BDI declined from a high of 11,793 onin May ~~20,~~ 2008 to a low of 663 onin December 5, 2008, which represents a decline of ~~94%~~94.0% within a single calendar year. ~~The BDI fell over 70% during October 2008 alone.~~ During 2009, 2010 and ~~2010,~~2011, the BDI remained ~~volatile, reaching in~~volatile. During 2009, the BDI reached a low of 772 onin January 5, 2009 and a high of 4,661 onin November ~~19, 2009, and, in~~2009. During 2010, ~~reaching~~the BDI reached a high of 4,209 onin May ~~26,~~ 2010 and a low of 1,700 in July 2010. During 2011, the BDI remained volatile, ranging from a low of 1,042 on ~~July 15, 2010.~~February 4, 2011 to a high of 2,173 on October 14, 2011. The BDI continued to ~~decrease~~decline during the start of 2012 reaching a 26-year low of 647 on February 3, 2012 and thereafter increased to a high of 1,165 on May 8, 2012. During 2013, the BDI remained volatile reaching a low of 698 on January 2, 2013 and improved to 2,337 as of December 12, 2013. The BDI was 939 as of April 22, 2014.

Vessel Prices

Newbuilding prices have increased significantly since 2003, due to tightness in shipyard capacity, high steel prices, rising labor cost, high levels of new ordering and stronger freight rates. However, with the sudden and steep decline in freight rates after August 2008 and lack of new vessel ordering, newbuilding vessel values entered a downward trend and have continued to gradually decline. This trend however was reversed in the later part of the second half of 2013, as the increase in freight rates has led to a substantial amount of new orders being placed to shipyards in Japan, Korea and China taking up much of their available capacity for 2014 and therefore shifting the pricing power from buyers to shipbuilders.

In broad terms, the secondhand market is affected by both the newbuilding prices as well as the overall freight expectations and sentiment observed at any given time. The steep increase in newbuilding prices and the strength of the charter market have also affected values, to the extent that prices rose sharply in 2004 and 2005, before dipping in the early part of 2006, only to rise thereafter to new highs in the first ~~two months~~half of ~~2011.~~

~~Vessel Prices~~

~~Dry bulk vessel~~2008. However, the sudden and sharp downturn in freight rates since August 2008 has also had a very negative impact on secondhand values. Currently, newbuilding and secondhand values have ~~declined both as a result of a slowdown in~~recovered from the ~~availability of global credit and~~well below the significant deterioration in charter rates. Charter rates and vessel values have been affected in part by the lack of availability of credit to finance both vessel purchases and purchases of commodities carried by sea. Consistent with these trends, the market value of our dry bulk carriers has declined. Although charter rates and vessel values have increased from their low levels inlows reached during 2008 ~~there can be no assurance as to how long charter rates and vessel values will~~through 2012, although they still remain ~~at their current levels or whether they will decrease or improve to any significant degree.~~

below historical mean levels.

Seasonality

Our fleet consists of dry bulk vessels that operate in markets that have historically exhibited seasonal variations in demand and, as a result, in charter rates. The dry bulk sector is typically stronger in the fall and winter months in anticipation of increased consumption of coal and other raw materials in the northern hemisphere during the winter months. Such seasonality will affect the rates we obtain on the vessels in our fleet that operate on the spot market.

Permits and Authorizations

We are required by various governmental and quasi-governmental agencies to obtain certain permits, licenses and certificates with respect to our vessels. The kinds of permits, licenses and certificates required depend upon several factors, including the commodity transported, the waters in which the vessel operates, the nationality of the vessel’s crew and the age of a vessel. We have been able to obtain all permits, licenses and certificates currently required to permit our vessels to operate. Additional laws and regulations, environmental or otherwise, may be adopted which could limit our ability to do business or increase the cost of us doing business.

Inspection by Classification Societies

Every oceangoing vessel must be “classed” by a classification society. The classification society certifies that the vessel is “in class,” signifying that the vessel has been built and maintained in accordance with the rules of the classification society and complies with applicable rules and regulations of the vessel’s country of registry and the international conventions of which that country is a member. In addition, where surveys are required by international conventions and corresponding laws and ordinances of a flag state, the classification society will undertake them on application or by official order, acting on behalf of the authorities concerned.

The classification society also undertakes on request other surveys and checks that are required by regulations and requirements of the flag state. These surveys are subject to agreements made in each individual case and/or to the regulations of the country concerned. For maintenance of the class certification, regular and extraordinary surveys of hull, machinery, including the electrical plant, and any special equipment classed are required to be performed as follows:

Annual Surveys. For seagoing vessels, annual surveys are conducted for the hull and the machinery, including the electrical plant and where applicable for special equipment classed, at intervals of 12 months from the date of commencement of the class period indicated in the certificate.

Intermediate Surveys. Extended annual surveys are referred to as intermediate surveys and typically are conducted two and one-half years after commissioning and each class renewal. Intermediate surveys may be carried out on the occasion of the second or third annual survey.

Class Renewal Surveys. Class renewal surveys, also known as special surveys, are carried out for the vessel’s hull, machinery, including the electrical plant, and for any special equipment classed, at the intervals indicated by the character of classification for the hull. At the special survey the vessel is thoroughly examined, including audio-gauging to determine the thickness of the steel structures. Should the thickness be found to be less than class requirements, the classification society would prescribe steel renewals. The classification society may grant a one-year grace period for completion of the special survey. Substantial amounts of money may have to be spent for steel renewals to pass a special survey if the vessel experiences excessive wear and tear. In lieu of the special survey every four or five years, depending on whether a grace period was granted, a shipowner has the option of arranging with the classification society for the vessel’s hull or machinery to be on a continuous survey cycle, in which every part of the vessel would be surveyed within a five-year cycle. At an owner’s application, the surveys required for class renewal may be split according to an agreed schedule to extend over the entire period of class. This process is referred to as continuous class renewal.

All areas subject to survey as defined by the classification society are required to be surveyed at least once per class period, unless shorter intervals between surveys are prescribed elsewhere. The period between two subsequent surveys of each area must not exceed five years.

Most vessels are also drydocked every 30 to 36 months for inspection of the underwater parts and for repairs related to inspections. If any defects are found, the classification surveyor will issue a “recommendation” which must be rectified by the shipowner within prescribed time limits.

Most insurance underwriters make it a condition for insurance coverage that a vessel be certified as “in class” by a classification society that is a member of the International Association of Classification Societies. All ~~our~~the vessels that we own and operate are certified as being “in class” by Nippon Kaiji Kyokai (Class NK), ~~American~~DNV GL or Bureau ~~of Shipping or Germanischer Lloyd.~~Veritas. Typically, all new and secondhand vessels that we purchase must be certified prior to their delivery under our standard purchase contracts and ~~memorandum~~memoranda of agreement. Under our standard purchase contracts, unless negotiated otherwise, if the vessel is not certified on the date of closing, we would have no obligation to take delivery of the vessel. Although we may not have an obligation to accept any vessel that is not certified on the date of closing, we may determine nonetheless to purchase the vessel, should we determine it to be in our best interests. If we do so, we may be unable to charter such vessel after we purchase it until it obtains such certification, which could increase our costs and affect the earnings we anticipate from the employment of the vessel.

Vessels are dry-docked during intermediate and special surveys for repairs of their underwater parts. If “in water survey” notation is assigned, the vessel owner has the option of carrying out an underwater inspection of the vessel in lieu of dry-docking, subject to certain conditions. In the event that an “in water survey” notation is assigned as part of a particular intermediate survey, dry-docking would be required for the following special survey thereby generally achieving a higher utilization for the relevant vessel. Dry-docking can be undertaken as part of a special survey if the dry-docking occurs within 15 months prior to the special survey deadline.

The following table lists the dates by which we expect to carry out the next dry-dockings and special surveys for the vessels in our fleet excludingm/v Jin Star which is on a bareboat time charter until January 2015:

Vessel Name	Dry-docking	Special Survey	Classification Society
m/v Tiara Globe	May 2016	April 2018	Bureau Veritas
m/v River Globe	June 2015	December 2017	Class NK
m/v Sky Globe	November 2014	November 2014	DNV GL
m/v Star Globe	May 2015	May 2015	DNV GL
m/v Moon Globe	May 2014	November 2015	Class NK
m/vSun Globe	September 2015	August 2017	Bureau Veritas

Following an incident or a scheduled survey, if any defects are found, the classification surveyor will issue a “recommendation or condition of class” which must be rectified by the vessel owner within the prescribed time limits.

Risk Management and Insurance

General

The operation of any cargo vessel embraces a wide variety of risks, including the following:

mechanical failure or damage, for example by reason of the seizure of a main engine crankshaft;

cargo loss, for example arising from hull damage;

personal injury, for example arising from collision or piracy;

losses due to piracy, terrorist or war-like action between countries;

environmental damage, for example arising from marine disasters such as oil spills and other environmental mishaps;

physical damage to the vessel, for example by reason of collision;

damage to other property, for example by reason of cargo damage or oil pollution; and

business interruption, for example arising from strikes and political or regulatory change.

The value of such losses or damages may vary from modest sums, for example for a small cargo shortage damage claim, to catastrophic liabilities, for example arising out of a marine disaster, such as a serious oil or chemical spill, which may be virtually unlimited. While we maintain the traditional range of marine and liability insurance coverage for our fleet (hull and machinery insurance, war risks insurance and protection and indemnity coverage) in amounts and to extents that we believe are prudent to cover normal risks in our operations, we cannot insure against all risks, and we cannot be assured that all covered risks are adequately insured against. Furthermore, there can be no guarantee that any specific claim will be paid by the insurer or that it will always be possible to obtain insurance coverage at reasonable rates. Any uninsured or under-insured loss could harm our business and financial condition.

Hull and Machinery and War Risks

The principal coverages for marine risks (covering loss or damage to the vessels, rather than liabilities to third parties) are hull and machinery insurance and war risk insurance. These address the risks of the actual or constructive total loss of a vessel and accidental damage to a vessel’s hull and machinery, for example from running aground or colliding with another ship. These insurances provide coverage which is limited to an agreed “insured value” which, as a matter of policy, is never less than the particular vessel’s fair market value. Reimbursement of loss under such coverage is subject to policy deductibles ~~which~~that vary according to the vessel and the nature of the coverage. Hull and machinery deductibles may, for example, be between $75,000 and $150,000 per incident whereas the war risks insurance has a more modest incident deductible of, for example, $30,000.

Protection and Indemnity Insurance

Protection and indemnity insurance is a form of mutual indemnity insurance provided by mutual marine protection and indemnity associations, or “P&I Clubs,” formed by vessel owners to provide protection from large financial loss to one club member by contribution towards that loss by all members.

Each of ~~our~~the vessels that we operate is entered in the ~~Standard Steamship Owners’ Protection & Indemnity Association~~Gard P&I (Bermuda) ~~Limited,~~Ltd. which we refer to as the Club, for third party liability marine insurance coverage. The Club is a mutual insurance vehicle. As a member of the Club, we are insured, subject to agreed deductibles and our terms of entry, for our legal liabilities and expenses arising out of our interest in an entered ship, out of events occurring during the period of entry of the ship in the Club and in connection with the operation of the ship, against specified risks. These risks include liabilities arising from death of crew and passengers, loss or damage to cargo, collisions, property damage, oil pollution and wreck removal.

The Club ~~covers approximately 120 million gross tons of shipping. It~~ benefits from its membership in the International Group of P&I Clubs, or the International Group, for its main reinsurance program, ~~(see below), coupled with its own~~and maintains a separate complementary insurance program for additional risks.

The Club’s policy year commences each February. The mutual calls are levied by way of Estimated Total Premiums, or ETP, and the amount of the final installment of the ETP varies in accordance with the actual total premium ultimately required by the Club for a particular policy year. Members have a liability to pay supplementary calls which may be levied by the Club if the ETP is insufficient to cover the Club’s outgoings in a policy year.

Cover per claim is generally limited to an unspecified sum, being the amount available from reinsurance plus the maximum amount collectable from members of the International Group by way of overspill ~~calls, which is currently $6.9 billion.~~calls. Certain exceptions apply, including a $1$1.0 billion limit on claims in respect of oil pollution, a $3$3.0 billion limit on cover for passenger and crew claims and a sub-limit of $2$2.0 billion for passenger claims.

~~Our deductibles are currently $25,000 per vessel, accident or occurrence.~~

To the extent that we experience either a supplementary or an overspill call our policy is to expense such amounts.

Uninsured Risks

Not all risks are insured and not all risks are insurable. The principal insurable risks which nevertheless remain uninsured across our fleet are “loss of hire” and “strikes.” We will not insure these risks because we regard the costs as disproportionate. These insurances provide, subject to a deductible, a limited indemnity for hire that is not receivable by the shipowner for reasons set forth in the policy. For example, loss of hire risk may be covered on a 14/90/90 basis, with a 14 days deductible, 90 days cover per incident and a 90-day overall limit per vessel per year. Should a vessel on time charter, where the vessel is paid a fixed hire day by day, suffer a serious mechanical breakdown, the daily hire will no longer be payable by the charterer. The purpose of the loss of hire insurance is to secure the loss of hire during such periods.

Environmental ~~Regulation~~

and Other Regulations

Sources of Applicable Rules and Standards

Shipping is one of the world’s most heavily regulated industries, and it is subject to many industry standards. Government regulation significantly affects the ownership and operation of vessels. These regulations consist mainly of rules and standards established by international conventions, but they also include national, state and local laws and regulations in force in jurisdictions where vessels may operate or are registered, and which may be more stringent than international rules and standards. This is the case particularly in the United States and, increasingly, in Europe.

A variety of governmental and private entities subject vessels to both scheduled and unscheduled inspections. These entities include local port authorities (the U.S. Coast Guard, harbor masters or equivalent entities), classification societies, flag state administration (country vessel of registry), and charterers, particularly terminal operators. Certain of these entities require vessel owners to obtain permits, licenses and certificates for the operation of their vessels. Failure to maintain necessary permits or approvals could require a vessel owner to incur substantial costs or temporarily suspend operation of one or more of its vessels.

Heightened levels of environmental and quality concerns among insurance underwriters, regulators and charterers continue to lead to greater inspection and safety requirements on all vessels and may accelerate the scrapping of older vessels throughout the industry. Increasing environmental concerns have created a demand for vessels that conform to stricter environmental standards. Vessel owners are required to maintain operating standards for all vessels that will emphasize operational safety, quality maintenance, continuous training of officers and crews and compliance with U.S. and international regulations. Because laws and regulations are frequently changed and may impose increasingly stricter requirements, we cannot predict the ultimate cost of complying with these requirements, or the impact of these requirements on the resale value or useful lives of our vessels. In addition, a future serious marine incident that causes significant adverse environmental impact could result in additional legislation or regulation that could negatively affect our profitability.

The International Maritime Organization, or IMO, has negotiated a number of international conventions concerned with preventing, reducing or controlling pollution from vessels. These fall into two main categories, consisting firstly of those concerned generally with vessel safety standards, and secondly of those specifically concerned with measures to prevent pollution.

Ship Safety Regulation

A primary international safety instrument is the Safety of Life at Sea Convention of 1974, as amended, or SOLAS, together with the regulations and codes of practice that form part of its regime. Much of SOLAS is not directly concerned with preventing pollution, but some of its safety provisions are intended to prevent pollution as well as promote safety of life and preservation of property. These regulations have been and continue to be regularly amended as new and higher safety standards are introduced with which we are required to comply.

An amendment of SOLAS introduced the International Safety Management, or ISM, Code, which has been effective since July 1998. Under the ISM Code, the party with operational control of a vessel is required to develop an extensive safety management system that includes, among other things, the adoption of a safety and environmental protection policy setting forth instructions and procedures for operating its vessels safely and describing procedures for responding to emergencies. The ISM Code requires that vessel operators obtain a safety management certificate for each vessel they operate. This certificate evidences compliance by a vessel’s management with code requirements for a safety management system. No vessel can obtain a certificate unless its manager has been awarded a document of compliance, issued by the respective flag state for the vessel, under the ISM Code.

Another amendment of SOLAS, made after the terrorist attacks in the United States on September 11, 2001, introduced special measures to enhance maritime security, including the International Ship and Port ~~Facilities~~Facility Security Code, or ISPS Code.

The vessels that we operate maintain ISM and ISPS certifications for safety and security of operations.

Regulations to Prevent Pollution from Ships

In the secondary main category of international regulation, the primary instrument is the International Convention for the Prevention of Pollution from Ships, or MARPOL, which imposes environmental standards on the shipping industry set out in Annexes I-VI of MARPOL. These contain regulations for the prevention of pollution by oil (Annex I), by noxious liquid substances in bulk (Annex II), by harmful substances in packaged forms within the scope of the International Maritime Dangerous Goods Code (Annex III), by sewage (Annex IV), by garbage (Annex V) and by air emissions (Annex VI).

These regulations have been and continue to be regularly amended as new and higher standards of pollution prevention are introduced with which we are required to comply.

For example, MARPOL Annex VI sets limits on Sulphur Oxides (SOx) and Nitrogen Oxides (NOx) emissions from vessel exhausts, prohibits deliberate emissions of ozone depleting substances and limits the emission of ~~volotile~~volatile organic compound (VOC). Limiting worldwide SOx emissions will mean a cap on the content of sulphur in fuel oil ~~and such cap will be reduced from the current 4.5% to~~of 3.5% ~~on or after January 2012.~~. For special areas (SECAS) the cap is lower at currently at 1.0% and will reduce to 0.1% after January 1, 2015. In addition, within the EU Member States the current cap is now at 0.1%. Limiting NOx emissions is set on a three tier reduction, the final one of which comes into force on January 1, 2016. We anticipate incurring costs at each stage of implementation on all these areas. Currently we are compliant in all our vessels.

Greenhouse Gas Emissions

In February 2005, the Kyoto Protocol to the United Nations Framework Convention on Climate Change entered into force. Pursuant to the Kyoto Protocol, adopting countries are required to implement national programs to reduce emissions of certain gases, generally referred to as greenhouse gases, which are suspected of contributing to global warming. Currently, the greenhouse gas emissions from international shipping do not come under the Kyoto Protocol. The European Union confirmed in April 2007 that it plans to expand the European Union emissions trading scheme by adding vessels. In December 2009, more than 27 nations, including the United States, entered into the ~~California Attorney General~~Copenhagen Accord. The Copenhagen Accord is non-binding, but is intended to pave the way for a comprehensive, international treaty on climate change. The IMO is evaluating various mandatory measures to reduce greenhouse gas emissions from international shipping, which may include market-based instruments or a carbon tax. The EU also has indicated that it intends to propose an expansion of an existing EU emissions trading regime to include emissions of greenhouse gases from vessels, and ~~a coalition of environmental groups petitioned~~individual countries in the EU may impose additional requirements. In the United States, the U.S. Environmental Protection Agency, or EPA, ~~in October 2007 to regulate~~issued an “endangerment finding” regarding greenhouse ~~gas emissions from ocean-going vessels~~gases under the Clean Air Act. While this finding in itself does not impose any requirements on our industry, it authorizes the EPA to regulate directly greenhouse gas emissions through a rule-making process. Any passage of new climate control legislation or other regulatory initiatives by the IMO, ~~European Union~~EU, the United States or ~~individual~~other countries or states where we operate that restrict emissions of greenhouse gases ~~from vessels~~ could ~~require us to make~~have a significant financial ~~expenditures, which~~and operational impact on our business through increased compliance costs or additional operational restrictions that we cannot predict with certainty at this time.

Anti-Fouling Requirements

In 2001, the IMO adopted the International Convention on the Control of Harmful Anti-fouling Systems on Ships, or the Anti-fouling Convention. The Anti-fouling Convention prohibits the use of organotin compound coatings to prevent the attachment of mollusks and other sea life to the hulls of vessels after September 1, 2003. The exteriors of vessels constructed prior to January 1, 2003 that have not been in drydock must, as of September 17, 2008, either not contain the prohibited compounds or have coatings applied to the vessel exterior that act as a barrier to the leaching of the prohibited compounds.vessels. Vessels of over 400 gross tons engaged in international voyages must obtain an International Anti-Fouling System Certificate and undergo a survey before the vessel is put into service or when the anti-fouling systems are altered or replaced.

Other International Regulations to Prevent Pollution

In addition to MARPOL, other more specialized international instruments have been adopted to prevent different types of pollution or environmental harm from vessel. In February 2004, the IMO adopted an International Convention for the Control and Management of Ships’ Ballast Water and Sediments, or the BWM Convention. This Convention has not come into force. The BWM Convention’s implementing regulations call for a phased introduction of mandatory ballast water exchange ~~requirements, beginning in 2009, to be replaced in time with mandatory concentration limits.~~requirements. The BWM Convention will not enter into force until 12 months after it has been adopted by 30 states, the combined merchant fleets of which represent not less than 35.0% of the gross tonnage of the world’s merchant shipping. To date, there has not been sufficient adoption of this standard by governments that are members of the convention for it to take force. ~~Moreover, the IMO has supported deferring the requirements of this convention that would first come into effect until December 31, 2011, even if it were to be adopted earlier.~~

Although the United States is not a party to ~~these conventions,~~the International Convention on Civil Liability for Oil Pollution Damage of 1969, as amended, or the CLC, many countries have ratified and follow the liability plan adopted by the IMO and set out in the CLC and its Protocols. Under this convention and depending on whether the country in which the damage results is a party to the 1992 Protocol to the CLC, a vessel’s registered owner is strictly liable for pollution damage caused in the territorial waters of a contracting state by discharge of persistent oil, subject to certain defenses. The limits on liability outlined in the 1992 Protocol use the International Monetary Fund currency unit of Special Drawing Rights, or SDR. Under an amendment to the 1992 Protocol that became effective on November 1, 2003, for vessels between 5,000 and 140,000 gross tons (a unit of measurement for the total enclosed spaces within a vessel), liability is limited to approximately 4.51 million SDR plus 631 SDR for each additional gross ton over 5,000. For vessels of over 140,000 gross tons, liability is limited to 89.77 million SDR. The exchange rate between SDRs and U.S. dollars was ~~0.629596~~0.64557 SDR per U.S. dollar on ~~March 23, 2011.~~April 24, 2014. The right to limit liability is forfeited under the CLC where the spill is caused by the shipowner’s actual fault and under the 1992 Protocol where the spill is caused by the shipowner’s intentional or reckless conduct. Vessels trading with states that are parties to these conventions must provide evidence of insurance covering the liability of the owner. In jurisdictions where the CLC has not been adopted, various legislative schemes or common law govern, and liability is imposed either on the basis of fault or in a manner similar to that of the convention. We believe that our protection and indemnity insurance will cover the liability under the plan adopted by the IMO.

IMO regulations also require owners and operators of vessels to adopt Ship Oil Pollution Emergency Plans. Periodic training and drills for response personnel and for vessels and their crews are required.

European Regulations

European regulations in the maritime sector are in general based on international law most of which were promulgated by the IMO and then adopted by the Member States. However, since theErika incident in 1999, when theErika broke in two off the coast of France while carrying heavy fuel oil, the European Community has become increasingly active in the field of regulation of maritime safety and protection of the environment. It has been the driving force behind a number of amendments of MARPOL (including, for example, changes to accelerate the timetable for the phase-out of single hull tankers, and prohibiting the carriage in such tankers of heavy grades of oil), and if dissatisfied either with the extent of such amendments or with the timetable for their introduction it has been prepared to legislate on a unilateral basis. In some instances where it has done so, international regulations have subsequently been amended to the same level of stringency as that introduced in Europe, but the risk is well established that EU regulations (and other jurisdictions) may from time to time impose burdens and costs on shipowners and operators which are additional to those involved in complying with international rules and standards.

In some areas of regulation the EU has introduced new laws without attempting to procure a corresponding amendment of international law. Notably, it adopted in 2005 a directive on ship-source pollution, imposing criminal sanctions for pollution not only where this is caused by intent or recklessness (which would be an offense under MARPOL), but also where it is caused by “serious negligence.” The directive could therefore result in criminal liability being incurred in circumstances where it would not be incurred under international law. Experience has shown that in the emotive atmosphere often associated with pollution incidents, retributive attitudes towards vessel interests have found expression in negligence being alleged by prosecutors and found by courts on grounds which the international maritime community has found hard to understand. Moreover, there is skepticism that the notion of “serious negligence” is likely to prove any narrower in practice than ordinary negligence. Criminal liability for a pollution incident could not only result in us incurring substantial penalties or fines but may also, in some jurisdictions, facilitate civil liability claims for greater compensation than would otherwise have been payable.

Compliance Enforcement

The flag state, as defined by the United Nations Convention on Law of the Sea, has overall responsibility for the implementation and enforcement of international maritime regulations for all vessels granted the right to fly its flag. The “Shipping Industry Guidelines on Flag State Performance” evaluates flag states based on factors such as sufficiency of infrastructure, ratification of international maritime treaties, implementation and enforcement of international maritime regulations, supervision of surveys, casualty investigations and participation at IMO meetings. The vessels that we operate are flagged in the Marshall ~~Islands.~~Islands and Malta. Marshall ~~Islands-flagged~~Islands- and Malta-flagged vessels have historically received a good assessment in the shipping industry.

Noncompliance with the ISM Code or other IMO regulations may subject the shipowner or bareboat charterer to increased liability, may lead to decreases in available insurance coverage for affected vessels and may result in the denial of access to, or detention in, some ports. The U.S. Coast Guard and European Union authorities have, for example, indicated that vessels not in compliance with the ISM Code will be prohibited from trading in U.S. and European Union ports, respectively. As of the date of this annual report on Form 20-F, each of our vessels is ISM Code certified. However, there can be no assurance that such certificate will be maintained.

The IMO continues to review and introduce new regulations. It is impossible to predict what additional regulations, if any, may be passed by the IMO and what effect, if any, such regulations may have on our operations.

United States Environmental Regulations and Laws Governing Civil Liability for Pollution

Environmental legislation in the United States merits particular mention as it is in many respects more onerous than international laws, representing a high-water mark of regulation with which shipowners and operators must comply, and of liability likely to be incurred in the event of non-compliance or an incident causing pollution.

U.S. federal legislation, including notably the OPA, establishes an extensive regulatory and liability regime for the protection and cleanup of the environment from oil spills, including bunker oil spills from dry bulk vessels as well as cargo or bunker oil spills from tankers. The OPA affects all owners and operators whose vessels trade in the United States, its territories and possessions or whose vessels operate in United States waters, which includes the United States’ territorial sea and its 200 nautical mile exclusive economic zone. Under the OPA, vessel owners, operators and bareboat charterers are “responsible parties” and are jointly, severally and strictly liable (unless the spill results solely from the act or omission of a third party, an act of God or an act of war) for all containment and clean-up costs and other damages arising from discharges or substantial threats of discharges of oil from their vessels. In addition to potential liability under the OPA as the relevant federal legislation, vessel owners may in some instances incur liability on an even more stringent basis under state law in the particular state where the spillage occurred.

~~Title VII of the U.S. Coast Guard and Maritime Transportation Act of 2004 amended the~~

The OPA ~~to require~~requires the owner or operator of any non-tank vessel of 400 gross tons or more that carries oil of any kind as a fuel for main propulsion, including bunkers, to prepare and submit a response plan for each vessel. ~~Prior to this amendment, these provisions of the OPA applied only to vessels that carried oil in bulk as cargo.~~ The vessel response plans must include detailed information on actions to be taken by vessel personnel to prevent or mitigate any discharge or substantial threat of such a discharge of oil from the ~~vessel due to operational activities or casualties.~~ vessel.

The OPA limits the liability of responsible parties to the greater of $1,000 per gross ton or ~~approximately $855,000~~$854,400 per ~~containership that is over 300 gross tons~~non-tank vessel (subject to possible adjustment for inflation).

These limits of liability do not apply if an incident was proximately caused by violation of applicable United States federal safety, construction or operating regulations or by a responsible party’s gross negligence or willful misconduct, or if the responsible party fails or refuses to report the incident or to cooperate and assist in connection with oil removal activities.

In addition, the Comprehensive Environmental Response, Compensation, and Liability Act, or CERCLA, which applies to the discharge of hazardous substances (other than oil) whether on land or at sea, contains a similar liability regime and provides for cleanup, removal and natural resource damages. Liability under CERCLA is limited to the greater of $300 per gross ton or $0.5 million for vessels not carrying hazardous substances as cargo or residue ($5.0 million for vessels carrying hazardous substances) unless the incident is caused by gross negligence, willful misconduct or a violation of certain regulations, in which case liability is unlimited.

We maintain, for each of our ~~owned~~ vessels, insurance coverage against pollution liability risks in the amount of $1.0 billion per event. This insurance coverage is subject to exclusions, deductibles and other terms and conditions. If any liabilities or expenses fall within an exclusion from coverage, or if damages from a catastrophic incident exceed the $1.0 billion limitation of coverage per event, our cash flow, profitability and financial position could be adversely impacted.

The OPA requires owners and operators of all vessels over 300 gross tons, even those that do not carry petroleum or hazardous substances as cargo, to establish and maintain with the U.S. Coast Guard evidence of financial responsibility sufficient to meet their potential liabilities under the OPA. The U.S. Coast Guard has implemented regulations requiring evidence of financial responsibility for containerships in the amount of $1,300 per gross ton, which includes the OPA limitation on liability of $1,000 per gross ton and the CERCLA liability limit of $300 per gross ton for vessels not carrying hazardous substances as cargo or residue. Under the regulations, vessel owners and operators may evidence their financial responsibility by showing proof of insurance, surety bond, self-insurance or guaranty. We believe our insurance coverage as described above meets the requirements of the OPA.

Under the OPA, an owner or operator of a fleet of vessels is required only to demonstrate evidence of financial responsibility in an amount sufficient to cover the vessel in the fleet having the greatest ~~maximum~~limited liability under the OPA. Under the self-insurance provisions, the shipowner or operator must have a net worth and working capital, measured in assets located in the United States against liabilities located anywhere in the world, that exceeds the applicable amount of financial responsibility.

The U.S. Coast Guard’s regulations concerning certificates of financial responsibility provide, in accordance with the OPA, that claimants may bring suit directly against an insurer or guarantor that furnishes the guaranty that supports the certificates of financial responsibility. In the event that such insurer or guarantor is sued directly, it is prohibited from asserting any contractual defense that it may have had against the responsible party and is limited to asserting those defenses available to the responsible party and the defense that the incident was caused by the willful misconduct of the responsible party.

The OPA specifically permits individual states to impose their own liability regimes with regard to oil pollution incidents occurring within their boundaries, and some states have enacted legislation providing for unlimited liability for oil spills. In some cases, states that have enacted such legislation have not yet issued implementing regulations defining vessels owners’ responsibilities under these laws. We intend to comply with all applicable state regulations in the ports where our vessels call.

The United States Clean Water Act, or CWA, prohibits the discharge of oil or hazardous substances in U.S. navigable waters and imposes strict liability in the form of penalties for unauthorized discharges. The CWA also imposes substantial liability for the costs of removal, remediation and damages and complements the remedies available under CERCLA. Pursuant to regulations promulgated by the EPA in the early 1970s, the discharge of sewage and effluent from properly functioning marine engines was exempted from the permit requirements of the National Pollution Discharge Elimination System. This exemption allowed vessels in U.S. ports to discharge certain substances, including ballast water, without obtaining a permit to do so. However, on March 30, 2005, a U.S. District Court for the Northern District of California granted summary judgment to certain environmental groups and U.S. states that had challenged the EPA regulations, arguing that the EPA exceeded its authority in promulgating them. On September 18, 2006, the U.S. District Court issued an order invalidating the exemption in EPA’s regulations for all discharges incidental to the normal operation of a vessel as of September 30, 2008, and directing the EPA to develop a system for regulating all discharges from vessels by that date.

The EPA enacted rules governing the regulation of ballast water discharges and other discharges incidental to the normal operation of vessels within U.S. waters. Under the rules, commercial vessels 79 feet in length or longer (other than commercial fishing vessels), or Regulated Vessels, are required to obtain a CWA permit regulating and authorizing such normal discharges. This permit, which the EPA has designated as the Vessel General Permit for Discharges Incidental to the Normal Operation of Vessels, or VGP, incorporates the current U.S. Coast Guard requirements for ballast water management as well as supplemental ballast water requirements, and includes limits applicable to specific discharge streams, such as deck runoff, bilge water and gray water.

For each discharge type, among other things, the VGP establishes effluent limits pertaining to the constituents found in the effluent, including best management practices, or BMPs, designed to decrease the amount of constituents entering the waste stream. Unlike land-based discharges, which are deemed acceptable by meeting certain EPA-imposed numerical effluent limits, each of the VGP discharge limits is deemed to be met when a Regulated Vessel carries out the BMPs pertinent to that specific discharge stream. The VGP imposes additional requirements on certain Regulated Vessel types that emit discharges unique to those vessels. Administrative provisions, such as inspection, monitoring, recordkeeping and reporting requirements are also included for all Regulated Vessels.

The VGP application procedure, known as the Notice of Intent, or NOI, may be accomplished through the “eNOI” electronic filing interface, which became operational in June 2009. Owners and operators of Regulated Vessels must have filed their NOIs prior to September 19, 2009, or the Deadline. Any Regulated Vessel that did not file an NOI by the Deadline would, as of that date, no longer be covered by the VGP and would not be allowed to discharge into U.S. navigable waters until it has obtained a VGP. Any Regulated Vessel that was delivered on or before the Deadline will receive final VGP permit coverage on the date that the EPA receives such Regulated Vessel’s complete NOI. Regulated Vessels delivered after the Deadline would not receive VGP permit coverage until 30 days after their NOI submission. We submitted NOIs for all our vessels to which the CWA applies.

In March 2013, the EPA issued the 2013 Vessel General Permit which will become effective on December 19, 2013. The 2013 Vessel General Permit contains more specified and stringent limits on the effluents than the existing VGP, and specific measures with respect to ships operating on the Great Lakes.

In addition, pursuant to ~~section~~Section 401 of the CWA, which requires each state to certify federal discharge permits such as the VGP, certain states have enacted additional discharge standards as conditions to their certification of the VGP. These local standards bring the VGP into compliance with more stringent state requirements, such as those further restricting ballast water discharges and preventing the introduction of non-indigenous species considered to be invasive. The VGP and related state-specific regulations and any similar restrictions enacted in the future will increase the costs of operating in the relevant waters.

The U.S. National Invasive Species Act, or NISA, was enacted in 1996 in response to growing reports of harmful organisms being released into U.S. ports through ballast water taken on by vessels in foreign ports. NISA established a ballast water management program for vessels entering U.S. waters. Under NISA, mid-ocean ballast water exchange is voluntary, except for vessels heading to the Great Lakes or Hudson Bay, or vessels engaged in the foreign export of Alaskan North Slope crude oil. However, NISA’s reporting and record keeping requirements are mandatory for vessels bound for any port in the United States. Although ballast water exchange is the primary means of compliance with NISA’s guidelines, compliance can also be achieved through the retention of ballast water on board the ship, or the use of environmentally sound alternative ballast water management methods approved by the U.S. Coast Guard. If the mid-ocean ballast exchange is made mandatory throughout the United States, or if water treatment requirements or options are instituted, the cost of compliance could increase for ocean carriers. Although we do not believe that the costs of compliance with a mandatory mid-ocean ballast exchange would be material, it is difficult to predict the overall impact of such a requirement on the dry bulk shipping industry. In April 2008, the U.S. House of Representatives passed a bill that amends NISA by prohibiting the discharge of ballast water unless it has been treated with specified methods or acceptable alternatives. Similar bills have been introduced in the U.S. Senate, but we cannot predict whether a similar bill will be enacted into law by the current U.S. Congress. In the absence of federal standards, states have enacted legislation or regulations to address invasive species through ballast water and hull cleaning management and permitting requirements. For instance, in 2007 the state of California enacted legislation extending its ballast water management program to regulate the management of “hull fouling” organisms attached to vessels and adopted regulations limiting the number of organisms in ballast water discharges. In addition, in November 2008, the Sixth Circuit affirmed a District Court’s dismissal of challenges to the state of Michigan’s ballast water management legislation mandating the use of various techniques for ballast water treatment. ~~Other~~Individual states may proceed with the enactment of similar requirements that could increase the costs of operating in state waters.

Security Regulations

Since the terrorist attacks of September 11, 2001, there have been a variety of initiatives intended to enhance vessel security. In November 2002, the MTSA came into effect. To implement certain portions of the MTSA, in July 2003, the U.S. Coast Guard issued regulations requiring the implementation of certain security requirements aboard vessels operating in waters subject to the jurisdiction of the United States. Similarly, in December 2002, amendments to SOLAS created a new chapter of the convention dealing specifically with maritime security. The new chapter went into effect on July 1, 2004, and imposes various detailed security obligations on vessels and port authorities, most of which are contained in the newly created ISPS Code. Among the various requirements are:

on-board installation of automatic information systems to enhance vessel-to-vessel and vessel-to-shore communications;

on-board installation of ship security alert systems;

the development of vessel security plans; and

compliance with flag state security certification requirements.

The U.S. Coast Guard regulations, intended to be aligned with international maritime security standards, exempt non-U.S. vessels from MTSA vessel security measures, provided such vessels have on board ~~by July 1, 2004,~~ a valid International Ship Security Certificate that attests to the vessel’s compliance with SOLAS security requirements and the ISPS Code. The vessels in our fleet that we operate have on board valid International Ship Security Certificates and, therefore, will comply with the requirements of the MTSA.

International Laws Governing Civil Liability to Pay Compensation or Damages

In 2001, the IMO adopted the International Convention on Civil Liability for Bunker Oil Pollution Damage, or the Bunker Convention, which imposes strict liability on shipowners for pollution damage in jurisdictional waters of ratifying states caused by discharges of “bunker oil.” The Bunker Convention defines “bunker oil” as “any hydrocarbon mineral oil, including lubricating oil, used or intended to be used for the operation or propulsion of the ship, and any residues of such oil.” The Bunker Convention also requires registered owners of vessels over a certain size to maintain insurance for pollution damage in an amount equal to the limits of liability under the applicable national or international limitation regime (but not exceeding the amount calculated in accordance with the Convention on Limitation of Liability for Maritime Claims of 1976, as amended, or the 1976 Convention). The Bunker Convention entered into force in November ~~2008, and in early 2009 it was in effect in 22 states.~~2008. In other jurisdictions, liability for spills or releases of oil from vessels’ bunkers continues to be determined by the national or other domestic laws in the jurisdiction where the events or damages occur.

Outside the United States, national laws generally provide for the owner to bear strict liability for pollution, subject to a right to limit liability under applicable national or international regimes for limitation of liability. The most widely applicable international regime limiting maritime pollution liability is the 1976 Convention. Rights to limit liability under the 1976 Convention are forfeited where a spill is caused by a shipowners’ intentional or reckless conduct. Some states have ratified the 1996 LLMC Protocol to the 1976 Convention, which provides for liability limits substantially higher than those set forth in the 1976 Convention to apply in such states. Finally, some jurisdictions are not a party to either the 1976 Convention or the 1996 LLMC Protocol, and, therefore, shipowners’ rights to limit liability for maritime pollution in such jurisdictions may be uncertain.

The Maritime Labour Convention

The International Labour Organization’s Maritime Labour Convention was adopted in 2006 (“MLC 2006”). The basic aims of the MLC 2006 are to ensure comprehensive worldwide protection of the rights of seafarers and to establish a level playing field for countries and ship owners committed to providing decent working and living conditions for seafarers, protecting them from unfair competition on the part of substandard ships. The Convention was ratified on August 20, 2012, and all our vessels have been certified, as required. We do not expect that the MLC 2006 requirements will have a material effect on our operations.

C. Organizational Structure

Globus is a holding company. We own ~~six~~eight operational subsidiaries, ~~all~~seven of which are Marshall Islands ~~corporations. Five~~corporations and one of which is incorporated in Malta. Seven of our operational subsidiaries each own one vessel and our ~~sixth~~eighth operational subsidiary, ~~Globus Shipmanagement,~~our Manager, provides the technical and day-to-day commercial management of our fleet. ~~Globus Shipmanagement~~Our Manager maintains ship management agreements with each of our vessel-owning subsidiaries.

D. Property, Plants and Equipment

In August 2006, ~~Globus Shipmanagement~~our Manager entered into a rental agreement for 350 square meters of office space for our operations within a building owned by Cyberonica S.A., a company related to us through common control. Rental expense is currently €14,578 per month. The rental agreement provides for an annual increase in rent of 2% above the rate of inflation as set by the Bank of Greece. The contract runs for nine years and can be terminated by us with six ~~months~~months’ notice. We do not presently own any real estate.

Other than our vessels, we do not have any material property. Our vessels are subject to priority mortgages, which secure our obligations under our various loan and credit facilities.

For further details regarding our loan and credit facilities, please read “Item 5. Operating and Financial Review and Prospects — B. Liquidity and Capital Resources — Indebtedness.”

We have no manufacturing capacity, nor do we produce any products.

We believe that our existing facilities are adequate to meet our needs for the foreseeable future.

Item 4A. Unresolved Staff Comments

None.

Item 5. Operating and Financial Review and Prospects

The following discussion should be read in conjunction with our consolidated financial statements and the accompanying notes thereto included elsewhere in this annual report on Form 20-F. We believe that the following discussion contains forward-looking statements that involve risks and uncertainties. Actual results or plan of operations could differ materially from those anticipated by forward-looking information due to factors discussed under “Item 3.D. Risk Factors” and elsewhere in this annual report on Form 20-F.

Please see the section “Cautionary Note Regarding Forward- Looking Statements” at the beginning of this annual report on Form 20-F.

A. Operating Results

Overview

We are an integrated dry bulk shipping company, which began operations in September 2006, providing marine transportation services on a worldwide basis. We own, operate and manage a fleet of dry bulk vessels that transport iron ore, coal, grain, steel products, cement, alumina and other dry bulk cargoes internationally. Following the conclusion of our initial public offering on June 1, 2007, our common shares were listed on the AIM under the ticker “GLBS.L.” On July 29, 2010, we effected a one-for-four reverse stock split, with our issued share capital resulting in 7,240,852 common shares of $0.004 each. On November 24, 2010, we redomiciled into the Marshall Islands pursuant to the BCA and a resale registration statement for our common shares was declared effective by the SEC. Once the resale registration statement was declared effective by the SEC, our common shares began trading on the Nasdaq Global Market under the ticker “GLBS.” We delisted our common shares from the AIM on November 26, 2010.

~~The composition~~

On June 30, 2011, we completed a follow-on public offering in the United States under the Securities Act, of ~~our fleet has changed significantly since December 2009.~~2,750,000 common shares at a price of $8.00 per share, the net proceeds of which amounted to approximately $20 million. As of December 31, ~~2009,~~2013, our ~~fleet~~issued and outstanding capital stock consisted of ~~four dry bulk vessels (two Handymaxes, one Supramax~~10,227,358 common shares and one Panamax) with an aggregate carrying capacity of 212,915 dwt. As of March 31, 2010 our fleet consisted of two dry bulk vessels (one Supramax and one Panamax) with an aggregate carrying capacity of 126,555 dwt. 2,567 Series A Preferred Shares.

As of December 31, 2010, our fleet consisted of five dry bulk vessels (three Supramaxes, one Panamax and one Kamsarmax) with an aggregate carrying capacity of ~~319,913~~319,664 dwt.

In March 2011, we purchased from an unaffiliated third party a 2007-built Supramax vessel for $30.3 million. The vessel was delivered in September 2011 and was named “Sun Globe.” In May 2011, we purchased from an unaffiliated third party a 2005-built Panamax vessel for $31.4 million. The vessel was delivered in June 2011 and was named “Moon Globe.” As of December 31, 2013 and 2012, our fleet consisted of seven dry bulk vessels (four Supramaxes, two Panamax and one Kamsarmax) with an aggregate carrying capacity of 452,886 dwt.

We intend to grow our fleet through timely and selective acquisitions of modern vessels in a manner that we believe will provide an attractive return on equity and will be accretive to our earnings and cash flow based on anticipated market rates at the time of purchase. There is no guarantee however, that we will be able to find suitable vessels to purchase or that such vessels will provide an attractive return on equity or be accretive to our earnings and cash flow.

Our ~~policy~~strategy is to ~~charter~~employ our vessels on a mix of all types of charter contracts, including bareboat charters, ~~generally with durations of up to three years, while also engaging vessels on the~~time charters and spot ~~market.~~charters. We may, from time to time, enter into charters with longer durations depending on our assessment of market conditions.

We seek to manage our fleet in a manner that allows us to maintain profitability across the shipping cycle and thus maximize returns for our shareholders. To accomplish this objective we have deployed our vessels primarily on a mix of bareboat and time charters (with terms of between ~~six~~three months and ~~two~~five years) and spot charters. According to our assessment of market conditions, we have adjusted the mix of these charters to take advantage of the relatively stable cash flow and high utilization rates associated with time charters or to profit from attractive spot charter rates during periods of strong charter market conditions.

The average number of vessels in our fleet for the years ended December 31, ~~2010, 2009~~2013, 2012 and ~~2008~~2011 was ~~4.0, 6.3~~7.0, 7.0 and ~~7.9~~5.8, respectively.

Our operations are managed by our Athens, Greece-based wholly owned subsidiary, Globus Shipmanagement Corp., ~~which~~our Manager, who provides in-house commercial and technical management exclusively for our vessels. ~~Globus Shipmanagement~~Our Manager enters into a ship management agreement with each of our wholly owned vessel-owning subsidiaries to provide such services.

Factors Affecting Our Results of Operations

We believe that the important measures for analyzing trends in our results of operations consist of the following:

Ownership days. We define ownership days as the aggregate number of days in a period during which each vessel in our fleet has been owned by us. Ownership days are an indicator of the size of our fleet over a period and affect both the amount of revenues and the amount of expenses that we record during a period.

Available days. We define available days as the number of our ownership days less the aggregate number of days that our vessels are off-hire due to scheduled repairs or repairs under guarantee, vessel upgrades or special surveys. The shipping industry uses available days to measure the number of days in a period during which vessels should be capable of generating revenues.

Operating days. Operating days are the number of available days in a period less the aggregate number of days that the vessels are off-hire due to any reason, including unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels generate revenues.

Fleet utilization. We calculate fleet utilization by dividing the number of our operating days during a period by the number of our available days during the period. The shipping industry uses fleet utilization to measure a company’s efficiency in finding suitable employment for its vessels and minimizing the amount of days that its vessels are off-hire for reasons other than scheduled repairs or repairs under guarantee, vessel upgrades, special surveys or vessel positioning.

Average number of vessels. We measure average number of vessels by the sum of the number of days each vessel was part of our fleet during a relevant period divided by the number of calendar days in such period.

TCE rates. We define TCE rates as our revenue less net revenue from our bareboat charters less voyage expenses during a period divided by the number of our available days during the period excluding bareboat charter days, which is consistent with industry standards. TCE is a non-GAAP measure. TCE rate is a standard shipping industry performance measure used primarily to compare daily earnings generated by vessels on time charters with daily earnings generated by vessels on voyage charters, because charter hire rates for vessels on voyage charters are generally not expressed in per day amounts while charter hire rates for vessels on time charters generally are expressed in such amounts.

The following table reflects our ownership days, available days, operating days, average number of vessels and fleet utilization for the periods indicated.

Year Ended December 31,
2010 2009 2008 2007
Ownership days 1,458 2,314 2,878 2,017
Available days 1,458 2,277 2,808 1,965
Operating days 1,441 2,246 2,781 1,837
Bareboat charter days 186 - - -
Fleet utilization 98.8 % 98.6 % 99.0 % 93.5 %
Average number of vessels 4.0 6.3 7.9 5.5
Daily time charter equivalent (TCE) rate $ 18,996 $ 21,550 $ 32,736 $ 19,702

	Year Ended December 31,
	2013			2012			2011			2010			2009
Ownership days		2,555			2,562			2,125			1,458			2,314
Available days		2,527			2,498			2,111			1,458			2,277
Operating days		2,486			2,471			2,083			1,441			2,246
Bareboat charter days		365			366			365			186			-
Fleet utilization		98.4	%		98.9	%		98.7	%		98.8	%		98.6	%
Average number of vessels		7.0			7.0			5.8			4.0			6.3
Daily time charter equivalent (TCE) rate	$	9,961		$	10,660		$	15,619		$	18,996		$	21,550

We utilize TCE because we believe it is a meaningful measure to compare period-to-period changes in our performance despite changes in the mix of charter types (i.e., voyage charters, spot charters and time charters) under which our vessels may be employed between the periods. Our management also utilizes TCE to assist them in making decisions regarding employment of our vessels. We believe that our method of calculating TCE is consistent with industry standards and is determined by dividing revenue after deducting voyage expenses, and net revenue from our bareboat charters, by available days for the relevant period excluding bareboat charter days. Voyage expenses primarily consist of brokerage commissions and port, canal and fuel costs that are unique to a particular voyage, which would otherwise be paid by the charter under a time charter contract.

The following table reflects the calculation of our daily TCE rates for the periods indicated.

	Year ended December 31,
	(Expressed in Thousands of U.S. Dollars, except number of days and daily TCE rates)
	2013		2012		2011		2010		2009

Revenue		29,434		32,197		35,559		28,860		52,812
Less: Voyage expenses		2,892		4,450		3,283		2,152		3,742
Less: bareboat charter net revenue		5,006		5,020		5,006		2,545		-
Net revenue excluding bareboat charter net revenue		21,536		22,727		27,270		24,163		49,070
Available days net of bareboat charter days		2,162		2,132		1,746		1,272		2,277
Daily TCE rate		9,961		10,660		15,619		18,996		21,550

Lack of Historical Operating Data for Vessels Before their Acquisition

Consistent with shipping industry practice, we were not and have not been able obtain the historical operating data for the secondhand vessels we purchase, in part because that information is not material to our decision to acquire such vessels, nor do we believe such information would be helpful to potential investors in our common shares in assessing our business or profitability. We purchased our vessels under a standardized agreement commonly used in shipping practice, which, among other things, provides us with the right to inspect the vessel and the vessel’s classification society records. The standard agreement does not provide us the right to inspect, or receive copies of, the historical operating data of the vessel. Accordingly, such information was not available to us. Prior to the delivery of a purchased vessel, the seller typically removes from the vessel all records, including past financial records and accounts related to the vessel. Typically, the technical management agreement between a seller’s technical manager and the seller is automatically terminated and the vessel’s trading certificates are revoked by its flag state following a change in ownership.

In addition, and consistent with shipping industry practice, we treat the acquisition of vessels from unaffiliated third parties as the acquisition of an asset rather than a business. We believe that, under the applicable provisions of Rule 11-01(d) of Regulation S-X under the Securities Act, ~~of 1933, as amended, which we refer to as the Securities Act,~~ the acquisition of our vessels does not constitute the acquisition of a “business” for which historical or pro forma financial information would be provided pursuant to Rules 3-05 and 11-01 of Regulation S-X.

Although vessels are generally acquired free of charter, we may in the future acquire some vessels with charters. Where a vessel has been under a voyage charter, the vessel is usually delivered to the buyer free of charter. It is rare in the shipping industry for the last charterer of the vessel in the hands of the seller to continue as the first charterer of the vessel in the hands of the buyer. In most cases, when a vessel is under time charter and the buyer wishes to assume that charter, the vessel cannot be acquired without the charterer’s consent and the buyer entering into a separate direct agreement, called a novation agreement, with the charterer to assume the charter. The purchase of a vessel itself does not transfer the charter because it is a separate service agreement between the vessel owner and the charterer.

~~Where we identify any intangible assets or liabilities associated with~~

If the ~~acquisition of~~Company acquires a vessel ~~we record all identified assets~~subject to a time charter, it amortizes the amount of the component that is attributable to favorable or ~~liabilities at fair value. Fair value is determined by reference~~unfavorable terms relative to market ~~data. We value any asset or liability arising from~~terms and is included in the ~~market~~cost of that vessel, over the remaining term of the lease. The amortization is included in line “amortization of fair value of time charter attached to vessels” in the ~~time charters assumed when a vessel is acquired. The amount to be recorded as an asset or liability at the date of vessel delivery is based on the difference between the current fair market value~~income statement component of the ~~charter and the net present value~~consolidated statement of future contractual cash flows. When the present value of the time charter assumed is greater than the current fair market value of such charter, the difference is recorded as prepaid charter revenue. When the opposite situation occurs, any difference, capped to the vessel’s fair value on a charter free basis, is recorded as deferred revenue. Such assets and liabilities, respectively, are amortized as a reduction of, or an increase in, revenue over the period of the time charter assumed.

comprehensive income.

If we purchase a vessel and assume or renegotiate a related time charter, we must take the following steps before the vessel will be ready to commence operations:

obtain the charterer’s consent to us as the new owner;

obtain the charterer’s consent to a new technical manager;

in some cases, obtain the charterer’s consent to a new flag for the vessel;

arrange for a new crew for the vessel, and where the vessel is on charter, in some cases, the crew must be approved by the charterer;

replace all hired equipment on board, such as gas cylinders and communication equipment;

negotiate and enter into new insurance contracts for the vessel through our own insurance brokers;

register the vessel under a flag state and perform the related inspections in order to obtain new trading certificates from the flag state;

implement a new planned maintenance program for the vessel; and

ensure that the new technical manager obtains new certificates for compliance with the safety and vessel security regulations of the flag state.

The following discussion is intended to help you understand how acquisitions of vessels affect our business and results of operations.

Our business is comprised of the following main elements:

employment and operation of our dry bulk vessels; and


	Ø	management of the financial, general and administrative elements involved in the conduct of our business and ownership of our dry bulk vessels.

The employment and operation of our vessels require the following main components:

vessel maintenance and repair;

crew selection and training;

vessel spares and stores supply;

contingency response planning;

onboard safety procedures auditing;

accounting;

vessel insurance arrangement;

vessel chartering;

vessel security training and security response plans (ISPS);

obtaining ISM certification and audit for each vessel within the six months of taking over a vessel;

vessel hire management;

vessel surveying; and

vessel performance monitoring.

The management of financial, general and administrative elements involved in the conduct of our business and ownership of our vessels requires the following main components:

management of our financial resources, including banking relationships, i.e., administration of bank loans and bank accounts;

management of our accounting system and records and financial reporting;

administration of the legal and regulatory requirements affecting our business and assets; and

management of the relationships with our service providers and customers.

The principal factors that affect our profitability, cash flows and shareholders’ return on investment include:

rates and periods of hire;

levels of vessel operating expenses, including repairs and ~~drydocking;~~dry-docking;

purchase and sale of vessels;

depreciation expenses;

financing costs; and


	Ø	fluctuations in foreign exchange rates.

Revenue

Overview

We generate revenues by charging our customers for the use of our vessels to transport their dry bulk commodities. Under a time charter, the charterer pays us a fixed daily charter hire rate and bears all voyage expenses, including the cost of bunkers (fuel oil) and port and canal charges. We remain responsible for paying the chartered vessel’s operating expenses, including the cost of crewing, insuring, repairing and maintaining the vessel, the costs of spares and consumable stores, tonnage taxes and other miscellaneous expenses. Under a bareboat charter, the charterer pays us a fixed daily charter hire rate and bears all voyage expenses, as well as the vessel’s operating expenses.

Spot charters can be spot voyage charters or spot time charters. Spot voyage charters involve the carriage of a specific amount and type of cargo on a load-port to discharge-port basis, subject to various cargo handling terms, and the vessel owner is paid on a per-ton basis. Under a spot voyage charter, the vessel owner is responsible for the payment of all expenses including capital costs, voyage and expenses, such as port, canal and bunker costs. A spot time charter is a contract to charter a vessel for an agreed period of time at a set daily rate. Under spot time charters, the charterer pays the voyage expenses.

Revenues

Our revenues are driven primarily by the number of vessels in our fleet, the number of days during which our vessels operate and the amount of daily hire rates that our vessels earn under charters or on the spot market, which, in turn, are affected by a number of factors, including:

the duration of our charters;

the number of days our vessels are hired to operate on the spot market;

our decisions relating to vessel acquisitions and disposals;

the amount of time that we spend positioning our vessels for employment;

the amount of time that our vessels spend in ~~drydocking~~dry-docking undergoing repairs;

maintenance and upgrade work;

the age, condition and specifications of our vessels;

levels of supply and demand in the dry bulk shipping industry; and

other factors affecting spot market charter rates for dry bulk vessels.

Our revenues grew significantly in 2008 as a result of the enlargement of our fleet, which increased our ownership, available and operating days. Revenues also increased in 2008 due to high time charter rates negotiated on vessels before the drastic decline in the dry bulk market during the latter five months of 2008, although not all of our vessels were employed through time charters.

Our revenues in 2009 declined as we were exposed to the lower charter rates on the spot market and consequently a number of vessels were fixed to new employments at daily time charter rates considerably lower than their previous employments, in addition to the lower spot charter rates we earned. We also disposed of vessels in 2009, which led to2013 decreased ~~ownership, available and operating days.~~

~~Our revenues in 2010 declined as a result of the reduction of the size of our fleet, which decreased our ownership, available and operating days. Revenues also decreased in 2010~~mainly due to lower daily time charter and spot rates earned on average from our vessels compared to ~~2009.~~

2012.

Our revenues in 2012 decreased mainly due to lower daily time charter and spot rates earned on average from our vessels compared to 2011.

Our revenues in 2011 increased compared to 2010 as a result of the increase in the size of our fleet, which increased our ownership, available and operating days.

Employment of our Vessels

As of December 31, ~~2010,~~2013, we employed our vessels as follows:

m/v Tiara Globe – on a spot time charter with Milestone Shipping S.A. that began in December 2013 and expired in February 2014, at the gross rate of $23,000 per day.

m/v Star Globe – on a spot time charter with CCX Shipping Co. Ltd. that began in December 2013 and expired in January 2014, at the gross rate of $17,000 per day.

m/v River Globe– on a time charter with ~~Transgrain Shipping~~Global Maritime Trust (S) Pte Ltd. that began in ~~February 2010~~January 2013 and ~~is scheduled to expire~~expired in ~~a minimum of 24 months (maximum of 26 months) from such date,~~March 2014, at the gross rate of ~~$20,000~~$7,600 per day.

~~m/v Star Globe~~ ~~– on a time charter with Transgrain Shipping that began in May 2010 and is scheduled to expire in a minimum of 11 months (maximum of 13 months) from such date, at the gross rate of $22,000 per day.~~

~~m/v River Globe~~ ~~– on the spot market.~~

m/v Jin Star – on a bareboat charter with Eastern Media International Corporation and Far Eastern Silo & Shipping (Panama) S.A. that began in June 2010 for a period of ~~five years~~56 months (which can be extended for one year at the charterer’s option, and thereafter extended one additional year at our option), at the gross rate of $14,250 per day.

m/v Sky Globe– on a spot time charter with Sandchart Limited that began in December 2013 and expired in January 2014, at the ~~spot market.~~gross rate of $20,500 per day.

m/v Moon Globe – on a time charter with Noble Resources International S.A. that began in July 2013 and expired in February 2014, at the gross rate of $8,500 per day.

m/v Sun Globe – on a time charter with Qingdao Ocean Shipping Co that began in September 2011 and is scheduled to expire in a minimum of 40 months (maximum of 42 months) from such date, at the gross rate of $16,000 per day.

Our charter agreements subject us to counterparty risk. In depressed market conditions, charterers may seek to renegotiate the terms of their existing charter parties or avoid their obligations under those contracts. Should counterparties to one or more of our charters fail to honor their obligations under their agreements with us, we could sustain significant losses which could have a material adverse effect on our business, financial condition, results of operations, cash flows and ability to pay dividends.

Voyage Expenses

We charter our vessels primarily through time charters under which the charterer is responsible for most voyage expenses, such as the cost of bunkers (fuel oil), port expenses, agents’ fees, canal dues, extra war risks insurance and any other expenses related to the cargo.

Whenever we employ our vessels on a voyage basis (such as trips for the purpose of geographically repositioning a vessel or trip(s) after the end of one time charter and up to the beginning of the next time charter), we incur voyage expenses that include port expenses and canal charges and bunker (fuel oil) expenses.

If we charter our vessels on bareboat charters, the charterer will pay for most of the voyage expenses.

As is common in the shipping industry, we have historically paid commissions ranging from ~~3.75%~~0% to 6.25% of the total daily charter hire rate of each charter to unaffiliated ship brokers and in-house brokers associated with the charterers, depending on the number of brokers involved with arranging the charter.

For ~~2010, 2009~~2013, 2012 and ~~2008,~~2011, commissions amounted to ~~$1.5~~$1.3 million, ~~$2.7~~$1.3 million and ~~$4.8~~$1.6 million, respectively.

We believe that the amounts and the structures of our commissions are consistent with industry practices.

These commissions are directly related to our revenues. We therefore expect that the amount of total commissions will increase as the size of our fleet grows as a result of additional vessel acquisitions and employment of those vessels.

Net Revenue

We calculate our net revenue by subtracting our voyage expenses from our revenues. Net ~~Revenue~~revenue is not a recognized measurement under IFRS and should not be considered as an alternative or comparable to net income.

Vessel Operating Expenses

Vessel operating expenses include costs for crewing, insurance, repairs and maintenance, lubricants, spare parts and consumable stores, statutory and classification tonnage taxes and other miscellaneous expenses. We calculate daily vessel operating expenses by dividing vessel operating expenses by ownership days for the relevant time period excluding bareboat charter days.

Our vessel operating expenses have historically fluctuated as a result of changes in the size of our fleet. In addition, a portion of our vessel operating expenses is in currencies other than the U.S. dollar, such as costs related to repairs, spare parts and consumables. These expenses may increase or decrease as a result of fluctuation of the U.S. dollar against these currencies.

We expect that crewing costs will increase in the future due to the shortage in the supply of qualified sea-going personnel. In addition, we expect that maintenance costs will increase as our vessels age. Other factors that may affect the shipping industry in general, such as the cost of insurance, may also cause our expenses to increase. To the extent that we purchase additional vessels, we expect our vessel operating expenses to increase accordingly.

Depreciation

The cost of our vessels is depreciated on a straight-line basis over the expected useful life of each vessel. Depreciation is based on the cost of the vessel less its estimated residual value. We estimate the useful life of our vessels to be 25 years from the date of delivery from the shipyard. Furthermore, we estimate the residual values of our vessels as of December 31, 2013 to be ~~$200~~$335 per light-weight ton. We do not expect these assumptions to change significantly in the near future. ~~Our depreciation charges have decreased in recent periods due to the reduction of the size our fleet.~~ We expect that these charges will increase if we acquire additional vessels.

Depreciation of ~~Drydocking~~Dry-docking Costs

Vessels are required to be ~~drydocked~~dry-docked for major repairs and maintenance that cannot be performed while the vessels are operating. ~~Drydockings~~Dry-dockings occur approximately every 2.5 years. The costs associated with the ~~drydockings~~dry-dockings are capitalized and depreciated on a straight-line basis over the period between ~~drydockings,~~dry-dockings, to a maximum of 2.5 years. At the date of acquisition of a secondhand vessel, we estimate the component of the cost that corresponds to the economic benefit to be derived until the first scheduled ~~drydocking~~dry-docking of the vessel under our ownership and this component is depreciated on a straight-line basis over the remaining period through the estimated ~~drydocking~~dry-docking date. We expect that ~~drydocking~~dry-docking costs will increase as our vessels age and if we acquire additional vessels.

Amortization of Fair Value of Time Charter Attached to Vessels

If the Company acquires a vessel subject to a time charter, it amortizes the amount of the component that is attributable to favorable or unfavorable terms relative to market terms and is included in the cost of that vessel, over the remaining term of the lease. The amortization is included in line “amortization of fair value of time charter attached to vessels” in the income statement component of the consolidated statement of comprehensive income.

Administrative Expenses

Our administrative expenses include payroll expenses, traveling, promotional and other expenses associated with us being a public company, which include the preparation of disclosure documents, legal and accounting costs, director and officer liability insurance costs and costs related to compliance. We expect that our administrative expenses will increase as we enlarge our fleet.

Administrative Expenses Payable to Related Parties

Our administrative expenses payable to related parties include cash remuneration of our executive officers and directors and rental of our office space.

Share Based Payments

We operate an equity-settled, share based compensation plan. The value of the service received in exchange of the grant of shares is recognized as an expense. The total amount to be expensed over the vesting period is determined by reference to the fair value of the share awards at the grant date. The relevant expense is recognized in the income statement component of the consolidated statement of comprehensive income, with a corresponding impact in equity.

Impairment Loss

We assess at each reporting date whether there is an indication that a vessel may be impaired. The vessel’s recoverable amount is estimated when events or changes in circumstances indicate the carrying value may not be recoverable. If such indication exists and where the carrying value exceeds the estimated recoverable amounts, the vessel is written down to its recoverable amount. The recoverable amount is the greater of fair value less costs to sell and value-in-use. In assessing value-in-use, the estimated future cash flows are discounted to their present value using a discount rate that reflects current market assessments of the time value of money and the risks specific to the vessel. Impairment losses are recognized in the consolidated statement of comprehensive income. A previously recognized impairment loss is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognized. If that is the case, the carrying amount of the asset is increased to its recoverable amount. That increased amount cannot exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognized for the asset in prior years. Such reversal is recognized in the consolidated statement of comprehensive income. After such a reversal, the depreciation charge is adjusted in future periods to allocate the asset’s revised carrying amount, less any residual value, on a systematic basis over its remaining useful life.

Gain/(Loss) on Sale of Vessels

Gain or loss on the sale of vessels is the residual value remaining after deducting from the vessels’ sale proceeds, the carrying value of the vessels at the respective date of delivery to their new owners and the total expenses associated with the sale.

Other Income/ (Expenses)~~/Income,~~, Net

We include other operating expenses or income that is not classified otherwise. It mainly consists of provisions for insurance claims deductibles and refunds from insurance claims.

Interest Income from Bank Balances & Bank Deposits

We earn interest on the funds we have deposited with banks as well as from short-term certificates of deposit.

Interest Expense and Finance Costs

We incur interest expense and financing costs in connection with the indebtedness under our credit ~~facility~~arrangements, including our Credit Facility, the Kelty Loan Agreement, the DVB Loan Agreement and ~~loan agreement.~~the Firment Credit Facility. We also incurred financing costs in connection with establishing those arrangements, which is included in our finance costs and amortization and write-off of deferred finance charges. As of December 31, ~~2010, 2009~~2013, 2012 and ~~2008,~~2011, we had ~~$96.7~~$91.5 million, ~~$70.6~~$105.9 million and ~~$157.6~~$111.4 million of indebtedness outstanding under our then existing credit arrangements, respectively. We incur interest expense and financing costs relating to our outstanding debt as well as our available but undrawn ~~credit facility.~~Credit Facility, if any. We will incur additional interest expense in the future on our outstanding borrowings and under future borrowings to finance future acquisitions.

Gain/(Loss)~~/Gain~~ on Derivative Financial Instruments

We may enter into derivative financial instruments, which mainly consist of interest rate SWAP agreements. Derivative financial instruments are initially recognized at fair value on the date a derivative contract is entered into and are subsequently remeasured at fair value. Changes in the fair value of these derivative instruments are recognized immediately in the income statement component of the consolidated statement of comprehensive income.

Foreign Exchange (Losses)/Gains, Net

We generate substantially all of our revenues from the trading of our vessels in U.S. dollars but incur a portion of our expenses in currencies other than the U.S. dollar. While we were incorporated in Jersey, the majority of our general and administrative expenses as well as the dividends paid to shareholders were in U.K. pounds sterling. We have since redomiciled into the Marshall Islands and our common shares are listed on the Nasdaq Global Market. Therefore, we do not anticipate having any material expenses in U.K. pounds sterling, and ~~going forward~~since our redomiciliation our dividends ~~will be~~have been declared and paid in U.S. dollars.

For cash management, or treasury, purposes, we convert U.S. dollars into foreign currencies to pay for our non-U.S. dollar expenses, which we then hold on deposit until the date of each transaction. Fluctuations in foreign exchange rates create foreign exchange gains or losses when we mark-to-market these non-U.S. dollar deposits.

For accounting purposes, expenses incurred in all foreign currencies are converted into U.S. dollars at the exchange rate prevailing on the date of each transaction.

Because a portion of our expenses is payable in currencies other than the U.S. dollar, our expenses may from time to time increase relative to our revenues as a result of fluctuations in exchange rates, which could affect the amount of net income that we report in future periods.

Results of Operations

The following is a discussion of our operating results for the year ended December 31, ~~2010~~2013 compared to the year ended December 31, ~~2009~~2012 and for the year ended December 31, ~~2009~~2012 compared to the year ended December 31, ~~2008.~~

2011.

Year ended December 31, ~~2010~~2013 compared to the year ended December 31, ~~2009~~2012

As of December 31, 2013 and 2012, our fleet consisted of seven dry bulk vessels (four Supramaxes, two Panamax and one Kamsarmax) with an aggregate carrying capacity of 452,886 dwt. During the years ended December 31, 2013 and 2012 we had an average of 7.0 dry bulk vessels in our fleet.

During 2013, we had an operating profit of $8.5 million including a non-cash impairment gain from impairment reversal of $1.7 million. During 2012, we had an operating loss of $80.3 million including a non-cash impairment loss for the year of 2012 of $80.2 million.

Revenue. Revenue decreased by $2.8 million, or 9%, to $29.4 million in 2013, compared to $32.2 million in 2012 due to the lower average shipping rates achieved by our vessels during 2013 compared to 2012. Net revenues (Revenues minus Voyage expenses) decreased by $1.2 million, or 4%, to $26.5 million in 2013, from $27.7 million in 2012. The decrease is primarily attributable to a decrease in average TCE rates due to the lower average shipping rates achieved by the vessels in our fleet during 2013 compared to 2012, which effectively reduced our net revenues by approximately $1.5 million, assuming all other variables were held constant. The decrease in our net revenue was partly offset by a 1% increase in available days which effectively increased our net revenues by approximately $0.3 million assuming all other variables were held constant. In 2013, we had total operating days of 2,486 and fleet utilization of 98.4%, compared to 2,471 operating days and a fleet utilization of 98.9% in 2012.

Voyage expenses. Voyage expenses decreased by $1.6 million, or 36%, to $2.9 million in 2013, compared to $4.5 million in 2012. This decrease is primarily attributable to the one-time charge recognized in 2012 of approximately $1.5 million relating to the non-performance of one of our charterers, Allied Maritime Inc., with the terms of the charter of them/v Star Globe.

Vessel operating expenses. Vessel operating expenses decreased by $0.4 million, or 4%, to $10.0 million in 2013, compared to $10.4 million in 2012year due to our continued efforts towards operational efficiency. The breakdown of our operating expenses for the year 2013 was as follows:

Crew expenses	51	%
Repairs and spares	21	%
Insurance	10	%
Stores	9	%
Lubricants	7	%
Other	2	%

Daily vessel operating expenses were $4,580 in 2013 compared to $4,736 in 2012, representing a decrease of 3% due to our continued efforts towards cost efficiency.

Depreciation. Depreciation decreased by $5.7 million, or 50%, to $5.6 million in 2013, compared to $11.3 million in 2011. The decrease in depreciation is attributed to the lower depreciable book value of the vessels resulting after the impairment charge of $80.2 million and the classification ofm/v Tiara Globe as non-current asset held for sale, both of which occurred in December 2012.

Amortization of fair value of time charter attached to vessels. Amortization of fair value of time charter attached to vessels during the years ended December 31, 2013 and 2012 were $1.3 and $1.8 million, respectively. Amortization refers to the fair value of above market time charters attached to the vesselsm/v Moon Globe andm/v Sun Globe acquired during the second half of 2011, which is amortized on a straight line basis over the remaining period of the time charters. The time charter attached tom/v Moon Globe expired in June 2013.

Administrative expenses. Administrative expenses increased by $0.2 million, or 11% to $2.1 million in 2013 from $1.9 million in 2012 mainly due to the imposition of a Greek authorities tax that became effective in January 2013. Please read “Item 10. Additional Information — E. Taxation.”

Share based payments. Share based payments decreased by $1.2 million in 2013 compared to 2012. During the year ended December 31, ~~2009, we agreed~~2013, the Company revised its estimate of the number of shares that will be awarded at the end of the award period, which is December 31, 2014, with reference to ~~sell~~the long time incentive plan currently in effect based on the non-market and service vesting conditions of the award and reversed $0.2 million corresponding to ~~unaffiliated third parties five vessels, each of~~the expense that had accrued from February 22, 2012, which was ~~built~~the grant date of the award. In 2012 we recognised share based expenses of approximately $0.9 million directly attributable to the value of Series A Preferred Shares issued in April 2012, the ~~mid-1990s. Three~~amortized portion of ~~these vessels (the~~ ~~m/v Island Globe~~, ~~m/v Gulf Globe~~ ~~and~~ ~~m/v Lake Globe) were delivered~~the conditional share based award granted to ~~their new owners during 2009, and~~our two ~~vessels (the~~ ~~m/v Sea Globe~~ ~~and~~ ~~m/v Coral Globe) were delivered to their new owners~~executive officers in February ~~2010.~~2012, the value on the grant date of the common shares in Globus, which were issued to our two executive officers in February 2012 as a bonus payment for services rendered and the amortized portion of the share based award granted to various employees and members of senior management in December 2009.

Impairment gain/(loss). During the year ended December 31, ~~2010,~~2013 we ~~acquired three~~recognized an impairment gain of $1.7 million with reference to them/v Tiara Globe. As of December 31, 2013,m/v Tiara Globe, classified as held for sale, was re-measured at fair value of $11.8 million, less estimated cost to sell of $0.4 million, less deferred dry-docking costs of $0.8 million, which resulted in a gain of $1.7 million when compared to the fair value less costs to sell as of December 31, 2012. During 2012, the Company performed an impairment analysis for all the vessels ~~from unaffiliated third parties. The~~ ~~m/v Sky Globe~~ ~~and~~ ~~m/v Star Globe~~ ~~were delivered~~in its fleet by comparing projected discounted cash flows to ~~us in May 2010 and~~ the ~~m/v Jin Star~~ ~~was delivered to us in June 2010.~~

~~During 2010, we had an operating profit of $9.3 million.~~

~~At the time in 2009 when both parties executed each~~carrying values of the ~~five memoranda~~vessels. As a result of ~~agreement~~this analysis the Company recognised an impairment loss of $55.8 million to ~~sell these vessels,~~ the book value ~~(or carrying amount)~~ of ~~each of such vessels was higher than the agreed sale price. The mandatory adjustment~~six out of the ~~book values (or~~seven vessels in our fleet. In addition, on December 4, 2012 the Company decided that them/v Tiara Globe met the criteria to be classified as non-current assets held for sale and was subsequently measured at the lower of its carrying ~~amount)~~amount and its fair value less cost to sell. In this respect the company recognised an impairment loss of ~~these five vessels resulted~~$24.4 million.

Interest expense and finance costs. Interest expense increased by $0.2 million, or 6%, to $3.6 million in 2013, compared to $3.4 million in 2012. The increase is mainly attributed to the increase in our weighted average interest rate to 2.54% during 2013 from 2.12% during 2012. Total borrowings outstanding as of December 31, 2013 amounted to $91.5 million compared to $105.9 million as of December 31, 2012. All of our credit and loan facilities are denominated in U.S. dollars.

Gain/(loss) on derivative financial instruments. Both our interest rate swap agreements fixed at unfavourable terms compared to the market, reached their maturity during November 2013 resulting in a ~~$28.4 million impairment charge~~gain for the year ended December 31, ~~2009~~2013 of $0.7 million.

Year ended December 31, 2012 compared to the year ended December 31, 2011

As of December 31, 2010, our fleet consisted of five dry bulk vessels (three Supramaxes, one Panamax and one Kamsarmax) with an aggregate carrying capacity of 319,664 dwt. In March 2011, we ~~had~~purchased from an ~~operating loss~~unaffiliated third party a 2007-built Supramax vessel for $30.3 million. The vessel was delivered in September 2011 and was named “Sun Globe.” In May 2011, we purchased from an unaffiliated third party a 2005-built Panamax vessel for $31.4 million. The vessel was delivered in June 2011 and was named “Moon Globe.” As of ~~$8.2 million.~~

December 31, 2012 and 2011, our fleet consisted of seven dry bulk vessels (four Supramaxes, two Panamax and one Kamsarmax) with an aggregate carrying capacity of 452,886 dwt. During the year ended December 31, ~~2010,~~2012, we had an average of ~~4.0~~7.0 dry bulk vessels in our fleet. During the year ended December 31, ~~2009,~~2011, we had an average of ~~6.3~~5.8 dry bulk vessels in our fleet.

During the year ended December 31, 2012, we had an operating loss of $80.3 million including a non-cash impairment loss for the year of 2012 of $80.2 million. During 2011, we had an operating profit of $9.3 million.

Revenue. Revenue decreased by ~~$23.9~~$3.4 million, or ~~45%~~10%, to ~~$28.9~~$32.2 million in ~~2010,~~2012, compared to ~~$52.8~~$35.6 million in ~~2009.~~2011. Net ~~revenue~~revenues decreased by ~~$22.4~~$4.6 million, or ~~46%~~14%, to ~~$26.7~~$27.7 million in ~~2010,~~2012, from ~~$49.1~~$32.3 million in ~~2009.~~2011. The decrease is ~~partly~~primarily attributable to a decrease in the size of the fleet, which resulted in a 36% decrease in operating days and effectively reduced our net revenue by approximately $17.7 million, assuming all other variables were held constant. In addition, the decrease is partly attributable to a 12% decrease in average TCE rates due to the ~~unfavorable~~lower average shipping rates achieved by the vessels in our fleet in ~~2010~~2012 compared to ~~2009,~~2011, which effectively reduced our net ~~revenue~~revenues by approximately ~~$4.7~~$10.5 million, assuming all other variables were held constant. The decrease in our net revenue was partly offset by a 19% increase in total operating days which effectively increased our net revenues by approximately $5.9 million assuming all other variables were held constant. In ~~2010,~~2012, we had total operating days of ~~1,441~~2,471 and fleet utilization of ~~98.8%~~98.9%, compared to ~~2,246~~2,083 operating days and a fleet utilization of ~~98.6%~~98.7% in ~~2009.~~

2011.

Voyage ~~expenses~~.expenses. Voyage expenses ~~decreased~~increased by ~~$1.5~~$1.2 million, or ~~41%~~36%, to ~~$2.2~~$4.5 million in ~~2010,~~2012, compared to ~~$3.7~~$3.3 million in ~~2009.~~2011. This ~~decrease~~increase is primarily attributable to the ~~decrease in~~one-time charge of approximately $1.5 million relating to the non-performance of one of our ~~revenues and~~charterers, Allied Maritime Inc., with the ~~reduction~~terms of the ~~size~~charter of ~~our fleet.~~them/v Star Globe.

Vessel operating ~~expenses~~.expenses. Vessel operating expenses ~~decreased~~increased by ~~$4.2~~$2.4 million, or ~~42%~~30%, to ~~$5.9~~$10.4 million in ~~2010,~~2012, compared to ~~$10.1~~$8.0 million in ~~2009.~~2011. The ~~decrease~~increase in operating expenses is primarily attributable to the ~~37% decrease~~21% increase in ownership days resulting from the ~~decrease~~increase of the average number of vessels in our fleet from ~~6.3~~5.8 vessels in ~~2009~~2011 to ~~4.0~~7.0 vessels in ~~2010.~~2012. The breakdown of our operating expenses ~~for the year 2010~~during 2012 was as follows:

Crew expenses	5250	%
Repairs and spares	1721	%
Insurance	109	%
Stores	11	%
Lubricants	7	%
Other	2	%

Daily vessel operating expenses were ~~$4,628~~$4,736 in ~~2010~~2012 compared to ~~$4,381~~$4,527 in ~~2009,~~2011, representing an increase of 6%5%.

Depreciation. Depreciation increased by $1.1 million, or 11%, to $11.3 million in 2012, compared to $10.2 million in 2011. This increase ~~is mainly due to the initial supplies for our two new acquisitions, the~~ ~~m/v Sky Globe~~ ~~and~~ ~~m/v Star Globe~~ ~~that were delivered to us in May 2010.~~

~~Depreciation. Depreciation decreased by $3.8 million, or 34%, to $7.4 million in 2010, compared to $11.2 million in 2009. This decrease~~ is directly the result of the ~~decrease~~increase in the average number of vessels in our fleet.

~~Depreciation~~

Amortization of ~~drydocking costs~~fair value of time charter attached to vessels. ~~Depreciation~~Amortization amounted to $1.8 million in 2012 compared to $0.8 million in 2011. Amortization refers to the fair value of ~~drydocking costs~~above market time charters attached to the two vessels them/v Moon Globe andm/v Sun Globe acquired during the second half of 2011 which is amortized on a straight line basis over the remaining period of the time charters.

Administrative expenses. Administrative expenses decreased by ~~$1.1~~$0.2 million, or ~~73%~~10%, to $1.9 million in 2012, compared to $2.1 million in 2011. This decrease is primarily a result of our efforts to control administrative expenses and operate more efficiently.

Administrative expenses payable to related parties. Administrative expenses payable to related parties decreased by $0.6 million, or 50%, to $0.6 million in 2012, compared to $1.2 million in 2011. This decrease is primarily a result of the termination of the consultancy agreements effected from December 31, 2011, with the companies wholly owned by each of our executive officers that assisted and advised the Chief Executive Officer and Chief Financial Officer in respect of their duties performed outside of Greece.

Share based payments. Share based payments increased by $0.6 million, or 150%, to $1.0 million in 2012, compared to $0.4 million in ~~2010, compared to $1.5 million in 2009. This decrease is directly the result of the decrease in the average number of vessels in our fleet.~~

~~Administrative expenses. Administrative expenses increased by $0.3 million, or 15%, to $2.3 million in 2010, compared to $2.0 million in 2009.~~2011. This increase is directly attributable to the ~~result~~value of Series A Preferred Shares issued during April 2012 of $0.2 million, the amortized portion of the ~~additional costs incurred for listing~~conditional share based award granted to our two executive officers during February 2012 of $0.2 million and the value at grant date of the common shares ~~on the Nasdaq Global Market.~~

~~Share based payments. Share based payments decreased by $1.5~~in Globus that amounted to $0.2 million, or 83%, to $0.3 million in 2010, compared to $1.8 million in 2009. On April 21, 2009, our board of directors in agreement with our chief executive officer, decided to release the unvested 42,763 common shares awarded on March 4, 2008issued to our ~~chief~~two executive ~~officer under our long term incentive plan. We accounted~~officers during February 2012 as a bonus payment for the cancellation of the award as an acceleration of vesting and therefore recognized immediately the amount that otherwise would have been recognized over the remaining of the vesting period to March 4, 2011. The amount recognized in 2009 relating to such cancellation was $1.4 million. There was no such charge in 2010.

services rendered.

Impairment loss. ~~No impairment loss was recognized in 2010. In 2009, we entered into five memoranda of agreement for~~During the ~~sale of the~~ ~~m/v Sea Globe~~, ~~m/v Coral Globe~~, ~~m/v Island Globe~~, ~~m/v Gulf Globe~~ ~~and~~ ~~m/v Lake Globe~~. From the date each memorandum of agreement was executed until the delivery of each vessel to its respective new owner, the vessels were classified as held for sale and were measured at the lower of their carrying amount and fair value less cost to sale. As a result,year ended December 31, 2012, we recognized an impairment loss of ~~approximately $28.4 million~~$80.2 million. The Company tests for impairment of its long lived assets whenever events or changes in circumstances indicate that the ~~year ended December 31, 2009.~~

~~Interest income from bank balances & deposits. Interest income decreased~~carrying amount of the assets may not be recoverable. Due to the sustained decline in charter rates and vessel values during the last four years and because market expectations for future rates are low and are unlikely to increase to the high levels of 2008 in the foreseeable future, we performed an impairment analysis for all the vessels in our fleet by ~~$0.8 million, or 80%,~~comparing projected discounted cash flows to ~~$0.2 million in 2010, compared to $1.0 million in 2009. This decrease is directly~~ the carrying values of vessels. As a result of this analysis we recorded an impairment loss of $55.8 million to the ~~decrease in~~book value of six out of the seven vessels of our ~~average cash balances.~~

fleet. In addition, on December 4, 2012, we decided that them/v Tiara Globe met the criteria to be classified as non-current asset held for sale and was subsequently measured at the lower of its carrying amount and its fair value less cost to sell. In this respect we recognized an impairment loss of $24.4 million.

Interest expense and finance ~~costs~~.costs. Interest expense ~~decreased~~increased by ~~$0.8~~$0.6 million, or ~~28%~~21%, to ~~$2.1~~$3.4 million in ~~2010,~~2012, compared to ~~$2.9~~$2.8 million in ~~2009.~~2011. This ~~decrease~~increase is ~~directly~~mainly due to the ~~result of the decrease~~increase in our average level of debt during ~~2010~~2012 compared to ~~2009.~~2011 as well as due to the increase in our weighted average interest rate to 2.12% during 2012 from 1.69% during 2011. The total outstanding bank loans as of December 31, ~~2010~~2012 amounted to ~~$96.7~~$105.9 million compared to ~~$70.6~~$111.4 million as of December 31, ~~2009.~~2011. All of our bank loans are denominated in U.S. dollars.

Gain/(loss) on derivative financial ~~instruments~~.instruments. The valuation of our two interest rate swaps at the end of each period is affected by the prevailing interest rates at that time. At December 31, ~~2010,~~2012, the two interest rate SWAP agreements (for $25 million in total, or ~~26%~~24% of our total debt outstanding of ~~$96.7~~$105.9 million) were recorded at fair market value, which is the amount that would be paid by us or to us should those instruments be terminated. The change in the valuation of the SWAP agreements between December 31, ~~2010~~2012 and December 31, ~~2009~~2011 was recorded as a ~~$0.6 million non-cash unrealized loss for 2010.~~

~~Foreign exchange (losses)/gains, net~~. Foreign exchange losses were $0.9 million for 2010, compared to losses of $0.2 million in 2009. Foreign currency exchange losses resulted primarily from the change in fair value of cash deposits in the Euro, as well as currency exchanges, to pay for vessel operating expenses and general and administrative expenses, a portion of which were in currencies other than the U.S. dollar.

~~Year ended December 31, 2009 compared to the year ended December 31, 2008~~

~~During the year ended December 31, 2009, we agreed to sell to unaffiliated third parties five vessels, each of which was built in the mid-1990s. Three of these vessels (the~~ ~~m/v Island Globe~~, ~~m/v Gulf Globe~~ ~~and~~ ~~m/v Lake Globe) were delivered to their new owners during 2009, and two vessels (the~~ ~~m/v Sea Globe~~ ~~and~~ ~~m/v Coral Globe~~) were delivered to their new owners in February 2010. At the time in 2009 when both parties executed each of the five memoranda of agreement to sell these vessels, the book value (or carrying amount) of each of such vessels was higher than the agreed sale price. The mandatory adjustment of the book values (or carrying amount) of these five vessels resulted in a $28.4 million impairment charge for the year ended December 31, 2009 and we had an operating loss of $8.2 million, whereas during the year ended December 31, 2008, we had an operating profit of $51.6 million.

~~During the year ended December 31, 2008, we sold to an unaffiliated third party the~~ ~~m/v Ocean Globe, built in the mid-1990s, for a sale price that exceeded the book value (or carrying amount) of the vessel, which resulted in a $15.1 million profit on the sale.~~

~~During the year ended December 31, 2009, we had an average of 6.3 dry bulk vessels in our fleet. During the year ended December 31, 2008, we had an average of 7.9 dry bulk vessels in our fleet.~~

~~Revenue~~. Revenue decreased by $45.8 million, or 46%, to $52.8 million for 2009, compared to $98.6 million for 2008. Net revenue decreased by $42.8 million, or 47%, to $49.1 million for 2009, from $91.9 million for 2008. The decrease is partly attributable to a decrease in the size of the fleet, which resulted in a 19% decrease in operating days and effectively reduced our revenue by approximately $17.4 million, assuming all other variables were held constant. In addition, the decrease is partly attributable to a 34% decrease in average TCE rates due to the unfavorable shipping rates in 2009 compared to 2008, which effectively reduced our net revenue by approximately $25.4 million, assuming all other variables were held constant. In 2009, we had total operating days of 2,246 and fleet utilization of 98.6%, compared to 2,781 total operating days and a fleet utilization of 99.0% in 2008.

~~Voyage expenses~~. Voyage expenses decreased by $3.0 million, or 45%, to $3.7 million in 2009, compared to $6.7 million in 2008. This decrease is attributable to the decrease in our revenues and the reduction of the size of our fleet.

~~Vessel operating expenses~~. Vessel operating expenses decreased by $2.4 million, or 19%, to $10.1 million in 2009, compared to $12.5 million in 2008. The decrease in operating expenses is attributable to the 20% decrease in ownership days resulting from the sale of vessels in our fleet. The breakdown of our operating expenses for the year 2009 was as follows:

~~Crew expenses~~	52	%
~~Repairs and spares~~	17	%
~~Insurance~~	11	%
~~Stores~~	9	%
~~Lubricants~~	9	%
~~Other~~	2	%

Daily vessel operating expenses were $4,381 in 2009 compared to $4,356 in 2008, representing an increase of less than 1%. This increase is a result of a combination of lower insurance costs due to the lower values of our vessels, ~~higher crewing cost attributable to increased salaries paid to our crews and higher cost for lubricants due to increased lubricants prices.~~

~~Depreciation~~. Depreciation decreased by $6.2 million, or 36%, to $11.2 million for 2009, compared to $17.4 million for 2008. This decrease is directly the result of the decrease in the number of vessels in our fleet.

~~Depreciation of drydocking costs. Depreciation of drydocking costs decreased by $0.1 million, or 5%, to $1.5 million for 2009, compared to $1.6 million for 2008.~~

~~Administrative expenses. Administrative expenses for 2009 decreased by $0.1 million or 5% to $2.0 million, compared to $2.1 million in 2008. The decrease in administration expenses is due to our improved cost efficiency.~~

~~Share based payments~~. Share based payments for 2009 increased by $1 million or 125% to $1.8 million, compared to $0.8 million in 2008. On April 21, 2009, our board of directors in agreement with our chief executive officer, decided to release the unvested 171,052 common shares awarded on March 4, 2008 to our chief executive officer under our long term incentive plan. We accounted for the cancellation of the award as an acceleration of vesting and therefore recognized immediately the amount that otherwise would have been recognized over the remaining of the vesting period to March 4, 2011. The amount recognized was $1.4 million.

~~Impairment loss. In 2009, we entered into five memoranda of agreement for the sale of the~~ ~~m/v Sea Globe~~, ~~m/v Coral Globe~~, ~~m/v Island Globe~~, ~~m/v Gulf Globe~~ ~~and~~ ~~m/v Lake Globe~~. From the date each memorandum of agreement was executed until the delivery of each vessel to its respective new owner, the vessels were classified as held for sale and were measured at the lower of their carrying amount and fair value less cost to sale. As a result, we recognized an impairment loss of approximately $28.4 million for the year ended December 31, 2009. As of December 31, 2008, we assessed whether any of our vessels may have been impaired. We concluded that the recoverable amount for the ~~m/v Tiara Globe~~ ~~and~~ ~~m/v River Globe~~ ~~was lower than their carrying values. Subsequently, we recognized an impairment loss of approximately $20.2 million for the year ended December 31, 2008.~~

~~(Loss)/gain on sale of vessel~~. In 2009, we had a loss on sale of vessel of $0.8 million, compared to a gain on sale of vessel of $15.1 million in 2008. The loss is mainly attributable to a discount on the sale proceeds received due to late delivery of ~~m/v Island Globe~~ ~~to its new owners.~~

~~Interest income from bank balances & deposits. Interest income increased by $0.1 million, or 11%, to $1.0 million in 2009, compared to $0.9 million in 2008. The increase is attributable to the increased cash balances on average in our accounts.~~

~~Interest expense and finance costs~~. Interest expense decreased by $4.8 million, or 62%, to $2.9 million in 2009, compared to $7.7 million in 2008. The decrease is attributable to the lower prevailing LIBOR rates. The total outstanding bank loans as of December 31, 2009 amounted to $70.6 million, compared to $157.6 million as of December 31, 2008. All of our bank loans are denominated in U.S. dollars.

~~Gain/(loss) on derivative financial instruments~~. At December 31, 2009, the two interest rate SWAP agreements (for $25.0 million in total or 35% of our then-existing total debt outstanding of $70.6 million) were recorded at fair value, which resulted in a $0.1$0.7 million non-cash unrealized gain ~~in favor of us as compared to the valuation of the SWAP agreements as of December 31, 2008.~~

~~Foreign exchange (losses)/gains, net. Foreign exchange losses were $0.2 million~~ for 2009, compared to losses of $0.6 million in 2008. Foreign currency exchange losses resulted primarily from currency exchanges to pay for operating expenses of our fleet and general and administrative expenses, a material portion of which were in currencies other than the U.S. dollar.

2012.

Inflation

Inflation has only a moderate effect on our expenses given current economic conditions. In the event that significant global inflationary pressures appear, these pressures would increase our operating, voyage, administrative and financing costs.

Critical Accounting Policies

The discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with IFRS as issued by the IASB. The preparation of those financial statements requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses and related disclosure of contingent assets and liabilities at the date of our financial statements. Actual results may differ from these estimates under different assumptions and conditions.

Critical accounting policies are those that reflect significant judgments of uncertainties and potentially result in material different results under different assumptions and conditions. We have described below what we believe are our most critical accounting policies, because they generally involve a comparatively higher degree of judgment in their application. For a description of all our significant accounting policies, see Note 2 to our consolidated financial statements included in this annual report on Form 20-F.

Impairment of Long-Lived Assets: We assess at each reporting date whether there is an indication that a vessel may be impaired. The vessel’s recoverable amount is estimated when events or changes in circumstances indicate the carrying value may not be recoverable.

If such indication exists and where the carrying value exceeds the estimated recoverable amounts, the vessel is written down to its recoverable amount. The recoverable amount is the greater of fair value less costs to sell and value-in-use. In assessing value-in-use, the estimated future cash flows are discounted to their present value using a discount rate that reflects current market assessments of the time value of money and the risks specific to the vessel. This assessment is made at the individual vessel level as separately identifiable cash flow information for each vessel is available. We determine the fair value of our assets based on management estimates and assumptions and by making use of available market data and taking into consideration third party valuations.

The estimated future cash flows are determined by considering the charter revenues from existing time charters for the fixed fleet days and an estimated daily time charter equivalent for the unfixed days, based on the most recent 10 year historical average of ~~the six-month,~~ one-year ~~and three-year~~ time charter ~~rates~~replacing the extreme values observed in the years 2008 and 2007 with the values in 2003 and 2002 over the remaining estimated life of each vessel, assuming an annual growth rate as published by the International Monetary Fund, or IMF, net of brokerage commissions. Expected outflows for scheduled vessels’ maintenance and vessel operating expenses are based on historical rates, and adjusted annually assuming an average annual inflation rate as published by the IMF. Effective fleet utilization is assumed to be ~~92%~~90%, taking into account the period(s) each vessel is expected to undergo ~~drydocking~~dry-docking and estimated off-hire days during the year. We have assumed no change in the remaining estimated useful lives of the current fleet, and scrap values were based on ~~$200~~$335 per lightweight ton at disposal.

Although we believe that the assumptions used to evaluate potential impairment are reasonable and appropriate, these assumptions are highly subjective and we are not able to estimate the variability between the assumptions used and actual results that is reasonably likely to result in the future.

Impairment losses are recognized in the consolidated statement of comprehensive income. A previously recognized impairment loss is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognized. If that is the case, the carrying amount of the asset is increased to its recoverable amount. That increased amount cannot exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognized for the asset in prior years. Such reversal is recognized in the consolidated statement of comprehensive income. After such a reversal, the depreciation charge is adjusted in future periods to allocate the asset’s revised carrying amount, less any residual value, on a systematic basis over its remaining useful life.

During the year ended December 31, 2013, we recognized a gain from an impairment reversal of $1.7 million. As of December 31, 2013,m/v Tiara Globe, classified as held for sale, was re-measured at fair value of $11.8 million, less estimated cost to sell of $0.4 million, less deferred dry-docking costs incurred of $0.8 million, which resulted in a gain of $1.7 million when compared to the fair value less cost to sell as of December 31, 2012. As of December 31, 2013, no impairment loss was recognized as the vessels’ recoverable amounts, excludingm/v Tiara Globe, exceeded their carrying amounts.

During the year ended December 31, 2012, due to the sustained decline in charter rates and vessel values during the previous four years and because market expectations for future rates are low and were unlikely to increase to the high levels of 2008 and 2007 in the foreseeable future, we performed an impairment analysis for all the vessels in our fleet by comparing projected discounted cash flows to the carrying values of vessels. As a result of this analysis we recorded an impairment loss of $55.8 million to the book value of six out of the seven vessels of our fleet. In addition, on December 4, 2012, we decided that them/v TiaraGlobe met the criteria to be classified as non-current asset held for sale and was subsequently measured at the lower of its carrying amount and its fair value less cost to sell. In this respect we recognized an impairment loss of $24.4 million.

Although we believe that the assumptions used to evaluate impairment are reasonable and appropriate, these assumptions are highly subjective and we are not able to estimate the variability between the assumptions used and actual results that is reasonably likely to result in the future.

For the purpose of presenting to our shareholders additional information in order determine how our future results of operations may be impacted in the event that daily time charter rates do not improve from their current levels in future periods, we set forth below an analysis that shows the 1-year, 3-year and 5-year historical average of one year time charter rates and the effect the use of each of these rates would have on our impairment charge.

	1-year (period)		Impairment charge (in millions of U.S. Dollars)		3-year (period)		Impairment charge (in millions of U.S. Dollars)		5-year (period)		Impairment charge (in millions of U.S. Dollars)
Panamax	$	10,099		6.3	$	11,489		6.3	$	15,435		6.3
Supramax	$	10,034		2.4	$	11,424		2.4	$	13,959		2.1
Total				8.7				8.7				8.4

As of December 31, 2013, we owned and operated a fleet of seven vessels, with an aggregate carrying value of $144.9 million including the value of them/v Tiara Globe classified as held for sale. The carrying value of each of our vessels does not necessarily represent its fair market value or the amount that could be obtained if the vessel were sold. Our estimates of the market values assume that the vessels are in good and seaworthy condition without need for repair and, if inspected, would be certified as being in class without any recommendations of any kind. Because vessel values are highly volatile, these estimates may not be indicative of either current or future prices that we could achieve if we were to sell any of the vessels. As of December 31, 2013, we believe that for all our remaining vessels other than them/v Tiara Globe the basic charter-free market value less estimated costs to sell was lower than the vessel’s carrying value by approximately $8.7 million in the aggregate. As of December 31, 2012, we believe that for all our remaining vessels other than them/v Tiara Globe the basic charter-free market value less estimated costs to sell was lower than the vessel’s carrying value by approximately $33.6 million in aggregate.

A vessel-by-vessel carrying value summary as of December 31, 2013 and 2012 follows:

Dry bulk Vessels	Dwt		Year Built		Month and Year of Acquisition	Purchase Price (in millions of U.S. Dollars)		Carrying Value as of December 31, 2013 (in millions of U.S. Dollars)		Carrying Value as of December 31, 2012 (in millions of U.S. Dollars)
m/v River Globe		53,627		2007	December 2007		57.5		19.9		21.0
m/v Sky Globe		56,855		2009	May 2010		32.8		22.0		22.9
m/v Star Globe		56,867		2010	May 2010		32.8		21.6		22.5
m/v Sun Globe		58,790		2007	September 2011		30.3		22.9		24.8
m/v Tiara Globe		72,928		1998	December 2007		66.8		11.4		8.9
m/v Moon Globe		74,432		2005	June 2011		31.4		19.4		20.8
m/v Jin Star		79,387		2010	June 2010		41.1		27.7		28.8
									144.9		149.7

Vessels, net: Vessels are stated at cost, less accumulated depreciation (including depreciation of dry-docking costs and component attributable to favorable or unfavorable lease terms relative to market terms) and accumulated impairment losses. Vessel cost consists of the contract price for the vessel and any material expenses incurred upon acquisition (initial repairs, improvements and delivery expenses, interest and on-site supervision costs incurred during the construction periods). Any seller’s credit, ~~i.e.,~~which is the amounts received from the seller of the vessels until date of delivery, is deducted from the cost of the vessel. Subsequent expenditures for conversions and major improvements are also capitalized when the recognition criteria are met. Otherwise, these amounts are charged to expenses as incurred. When we acquire a vessel with a time charter agreement assumed, the cost of acquisition is allocated between the individual assets and/or liabilities assumed based on their relative fair values at the time of acquisition. The time charter agreement assumed can be assigned a positive value (asset) or a negative value (deferred revenue) or zero value.

Vessels, Depreciation:We depreciate our vessels based on a straight line basis over the expected useful life of each vessel, which is 25 years from the date of their initial delivery from the shipyard, which we believe is within industry standards and represents the most reasonable useful life for each of our vessels. Depreciation is based on the cost of the vessel less its estimated residual value, ~~at the date of the vessel’s acquisition,~~ which is estimated at ~~$200~~$335 per lightweight ~~ton, which we believe is common in the shipping industry.~~ton. Secondhand vessels are depreciated from the date of their acquisition through their remaining estimated useful lives. A decrease in the useful life of a vessel or in its residual value would have the effect of increasing the annual depreciation charge. When regulations place limitations over the ability of a vessel to trade on a worldwide basis, its useful life is adjusted to end at the date such regulations become effective.

~~Drydocking~~

Dry-docking costs: Vessels are required to be ~~drydocked~~dry-docked for major repairs and maintenance that cannot be performed while the vessels are operating. ~~Drydockings~~Dry-dockings occur approximately every 2.5 years. The costs associated with the ~~drydockings~~dry-dockings are capitalized and depreciated on a straight-line basis over the period between ~~drydockings,~~dry-dockings, to a maximum of 2.5 years. At the date of acquisition of a secondhand vessel, management estimates the component of the cost that corresponds to the economic benefit to be derived until the first scheduled ~~drydocking~~dry-docking of the vessel under our ownership and this component is depreciated on a straight-line basis over the remaining period through the estimated ~~drydocking~~dry-docking date.

Costs capitalized are limited to actual costs incurred, such as shipyard rent, paints and related works and surveyor fees in relation to obtaining the class certification. If a ~~drydocking~~dry-docking is performed prior to the scheduled date, the remaining unamortized balances of previous ~~drydockings~~dry-dockings are immediately written off. Unamortized balances of vessels that are sold are written off and included in the calculation of the resulting gain or loss in the period of the vessel’s sale.

Amortization of lease component: When we acquire a vessel subject to a time charter, we amortize the amount of the component attributable to the favorable or unfavorable terms of the time charter relative to market terms which is included in the cost of that vessel, over the remaining term of the time charter.

Non-current assets held for sale: Non-current assets and disposal groups classified as held for sale are measured at the lower of carrying amount and fair value less costs to sell. We determine the fair value of our assets based on management estimates and assumptions and by making use of available market data and taking into consideration third party valuations. If the carrying amount exceeds fair value less costs to sell, we recognize a loss under impairment loss in the income statement component of the consolidated statement of comprehensive income. Non-current assets and disposal groups are classified as held for sale if their carrying amounts will be recovered through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable and the asset or disposal group is available for immediate sale in its present condition. Management must be committed to the sale, which should be expected to qualify for recognition as a complete sale within one year from the date of classification. Events or circumstances may extend the period to complete the sale beyond one year. An extension of the period required to complete a sale does not preclude an asset from being classified as held for sale if the delay is caused by events or circumstances beyond the entity’s control and there is sufficient evidence that the entity remains committed to its plan to sell the asset. Property, plant and equipment and intangible assets once classified as held for sale are not depreciated or amortized.

Revenue: We generate our revenues from charterers for the charter hire of our vessels. Vessels are chartered using time charters, where a contract is entered into for the use of a vessel for a specific period of time and a specified daily charter hire rate. If a time charter agreement exists and collection of the related revenue is reasonably assured, revenue is recognized on a straight line basis over the period of the time charter. Such revenues are treated in accordance with IAS 17 as lease income. Associated voyage expenses, which primarily consist of commissions, are recognized on a pro rata basis over the duration of the period of the time charter. Deferred revenue relates to cash received prior to the financial position date and is related to revenue earned after such date. Deferred revenue also includes the value ascribed to time charter agreements assumed upon the purchase of a vessel, if any. This ascribed amount is amortized over the remaining term of the time charter and the amortized portion for the period is included in revenue for the period.

Voyage expense: Consisting primarily of port expenses and owner’s expenses paid by the charterer, canal and bunker expenses that are unique to a particular charter under time charter arrangements or by us under voyage charter arrangements. Furthermore, voyage expenses include commission on income paid by us. We defer bunker expenses under voyage charter agreements and amortize them over the related voyage.

Trade receivables, net: The amount shown as trade receivables at each financial position date includes estimated recoveries from charterers for hire, freight and demurrage billings, net of an allowance for doubtful accounts. Trade receivables are measured at amortized cost less impairment losses, which are recognized in the consolidated statement of comprehensive income. At each financial position date, all potentially uncollectible accounts are assessed individually for the purpose of determining the appropriate allowance for doubtful accounts. Although we may believe that our provisions are based on fair judgment at the time of their creation, it is possible that an amount under dispute will not be recovered and the estimated provision of doubtful accounts would be inadequate. If any of our revenues become uncollectible, these amounts would be written-off at that time.

Derivative financial instruments: Derivative financial instruments are initially recognized at fair value on the date a derivative contract is entered into and are subsequently remeasured at fair value. The fair value of these instruments at each reporting date is derived principally from or corroborated by observable market data. Inputs include quoted prices for similar assets, liabilities (risk adjusted) and market-corroborated inputs, such as market comparables, interest rates, yield curves and other items that allow value to be determined. Changes in the fair value of these derivative instruments are recognized immediately in the income statement component of the consolidated statement of comprehensive income.

Share based payments:

The Company measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. Estimating fair value for share-based payment transactions may require determination of the most appropriate valuation model, which is dependent on the terms and conditions of the grant. This estimate also requires determination of the most appropriate inputs to the valuation model, including expected volatility and dividend yield and making assumptions about them.

B. Liquidity and Capital Resources

As of December 31, ~~2010,~~2013, we had ~~$24.6~~$5.9 million of “cash and bank balances and bank deposits” that consisted of $3.9 million cash and short-term bank deposits with original maturities ~~shorter~~of three months or less, $1.0 million bank deposit with original maturity of more than three ~~months.~~

months and $1.0 million on pledge. In addition we had an amount of $2.0 million available to be drawn under our Firment Credit Facility.

As of December 31, ~~2010,~~2013, we had an aggregate ~~bank~~ debt outstanding of ~~$96.7~~$91.5 million, which includes ~~$71.0~~$44.0 million ~~drawn~~ from ~~a credit facility with~~our Credit ~~Suisse~~Facility, $17.6 million from the Kelty Loan Agreement, $27.9 million from the DVB Loan Agreement and ~~$25.7~~$2.0 million ~~owed on a loan~~ from ~~Deutsche Schiffsbank taken by Kelty Marine Ltd. Kelty Marine’s loan agreement with Deutsche Schiffsbank permits it to declare and pay dividends without prior written permission~~our Firment Credit Facility issued for the purpose of the lender so long as there is no event of default under the loan agreement. Please see “Item 8.A. Consolidated Statements and Other Financial Information—Our Dividend Policy and Restrictions on Dividends” and “Item 5.B. Liquidity and Capital Resources—Indebtedness.”

financing our general working capital needs.

As of December 31, ~~2009,~~2012, we had ~~$59.2~~$11.7 million inof “cash and bank balances and bank deposits” that consisted of $9.7 million cash short-term bank deposits with original maturities ~~shorter than~~of three ~~months.~~

months or less and $2.0 million of deposits on pledge.

As of December 31, ~~2009,~~2012, we had an aggregate bank debt outstanding of ~~$70.6~~$105.9 million, of which ~~$34.2~~includes $52.0 million ~~was payable within~~from our Credit Facility, $21.7 million from the ~~next 12 months, including~~Kelty Loan Agreement and $32.2 million from the ~~entire outstanding balance of $27.0 million for the loan secured by the~~ ~~m/v Sea Globe~~ ~~and the~~ ~~m/v Coral Globe~~, which were shown on our Statement of Financial Position as “held for sale” under memoranda of agreement signed in November 2009. We fully repaid this loan to Deutsche Schiffsbank in February 2010 upon the delivery of these two vessels to their new unaffiliated third party owners. In addition, at December 31, 2009, we had committed undrawn funds up to $36.4 million under the facility with Credit Suisse.

DVB Loan Agreement.

Our primary uses of funds have been capital expenditures for the acquisition of vessels, vessel operating expenses, general and administrative expenses, expenditures incurred in connection with ensuring that our vessels comply with international and regulatory standards, financing expenses and repayments of bank loans and payments of dividends to our shareholders. We do not have any commitments for newbuilding contracts.

Since our operations began in 2006, we have financed our capital requirements ~~with~~mainly through equity contributions from shareholders, long-term bank debt and cash from operations, including cash from sales of vessels. To finance further vessel acquisitions of either new or secondhand vessels, we anticipate that our primary sources of funds will be our current cash, cash from continuing operations, additional indebtedness to be raised and, possibly, future equity or debt financings.

Working capital, which is current assets, ~~including non-current assets held for sale~~ minus current liabilities, including the current portion of long-term debt and non-current assets and associated liabilities classified as held for sale, amounted to ~~$11.6 million and $56.5~~a working capital deficit of $0.6 million as of December 31, ~~2010~~2013 and to a working capital deficit of $7.0 million as of December 31, ~~2009, respectively.~~

2012.

Because of the global economic downturn that has affected the international dry bulk industry we may not be able to obtain financing either from our ~~credit facility~~Credit Facility or the equity or debt capital markets. Based on our planned expenditures and assuming no unanticipated expenses, we believe that our cash reserves, ~~and~~ expected cash from operations and our shareholders will be sufficient to meet our anticipated cash needs for working capital and capital expenditures for the next twelve months.

Cash Flows

Cash and bank balances and bank deposits decreased to ~~$24.6~~$5.9 million as of December 31, ~~2010,~~2013, compared to ~~$59.2~~$11.7 million as of December 31, ~~2009~~2012 and ~~$65.3~~$9.3 million as of December 31, ~~2008. While~~2011, while $1.0 million, or 4%17%, was pledged as collateral and $1.0 million was placed at a time deposit with original maturity of more than three months at the end of 2013, $2.0 million, or 17%, was pledged as collateral at the end of ~~2010, $6.0~~2012 and $2.0 million, or ~~10%~~22%, was pledged as collateral at the end of ~~2009.~~2011. We consider highly liquid investments such as bank time deposits with an original maturity of three months or less to be cash equivalents.

Net Cash Generated From Operating Activities

Net cash generated from operating activities decreased by ~~$17.4~~$2.0 million, or ~~52%~~14%, to ~~$16.2~~$12.4 million in ~~2010,~~2013, compared to ~~$33.6~~$14.4 million in ~~2009.~~2012. The decrease ~~was~~is primarily attributable to ~~the~~a decrease in ~~the number of operating days that we achieved during the year~~average TCE rates due to the ~~operation of a smaller~~lower average shipping rates achieved by the vessels in our fleet and ~~the decrease~~increased working capital needs in ~~time charter equivalent rate, which resulted in decreased revenues.~~ 2013 compared to 2012.

Net cash generated from operating activities decreased by ~~$36.8~~$5.4 million, or ~~52%~~27%, to ~~$33.6~~$14.4 million in ~~2009,~~2012, compared to ~~$70.4~~$19.8 million in ~~2008.~~2011. The decrease ~~was~~is primarily attributable to ~~the~~a decrease in ~~the number of operating days that we achieved during the year~~average TCE rates due to the ~~operation of a smaller~~lower average shipping rates achieved by the vessels in our fleet ~~and the decrease~~ in ~~time charter equivalent rate, which resulted in decreased revenues.~~

2012 compared to 2011.

Net Cash Used In Generated From ~~(Used In)~~ Investing Activities

Net cash used in investing activities was ~~$72.7~~$1.0 million during ~~2010,~~the year ended December 31, 2013, which was attributable to $1.0 million time deposit with original maturity of more than three months.

Net cash used in investing activities was $0.3 million during the year ended December 31, 2012, which was directly attributable to $0.3 million used on vessel improvements.

Net cash used in investing activities was $61.8 million during the year ended December 31, 2011, which was fully attributed to the net cash ~~of $106.1 million~~ used for the acquisition of them/v ~~Star~~Moon Globe, andm/v ~~Sky~~Sun Globe ~~and~~ ~~m/v Jin Star~~ ~~and $33.0 million generated from the sale of the~~ ~~m/v Sea Globe~~ ~~and~~ ~~m/v Coral Globe~~ ~~and $0.4 million interest received on our cash balances.~~

Net Cash (Used In) Generated From Financing Activities

Net cash generated from investing activities was $60.3 million for 2009, which consisted mainly of the $49.0 million received from the sale of three vessels during 2009, plus $10.0 million which was reclassified upon the maturity of a time deposit with original maturity of four months, and $1.2 million interest received on our cash balances, as compared to net cash from investing activitiesused in ~~2008 of $27.1 million that related mostly to $36.8 million proceeds from the sale of the~~ ~~m/v Ocean Globe~~, and $0.6 million interest received on our cash balances, reduced by $10.0 million which was invested on a time deposit with maturity of four months and $0.3 million payments for vessel improvements.

~~Net Cash Generated From (Used In) Financing Activities~~

~~Net cash generated from~~ financing activities ~~in 2010~~during the year ended December 31, 2013 amounted to ~~$27.0~~$17.1 million and consisted of ~~$62.2 million of proceeds drawn for the acquisition of the~~ ~~m/v Star Globe~~, ~~m/v Sky Globe~~ ~~and~~ ~~m/v Jin Star~~ ~~and $5.0 million of pledged cash, which was released by the bank, reduced by $0.2 million of loan fees paid, $36.1~~$16.4 million of indebtedness that we repaid under our ~~then-existing~~existing credit and loan facilities, ~~$1.9~~$0.2 million paid on our Series A Preferred Shares, $3.5 million of interest paid, ~~on our loans~~reduced by $1.0 million of pledged time deposit released, and proceeds of $2.0 million ~~of dividends paid in 2010.~~

from the Firment Credit Facility entered into for financing general working capital needs.

Net cash used in financing activities ~~in 2009~~during 2012 amounted to ~~$74.5~~$11.7 million and consisted of ~~$87.0~~$5.4 million of indebtedness that we repaid under our ~~then-existing~~existing credit and loan facilities, ~~plus $2.9~~$2.5 million of dividends paid on our common shares, $0.5 million paid on our Series A Preferred Shares and $3.2 million of interest ~~paid on our loans, reduced by $15.4 million of pledged cash, which was released by the bank.~~

paid.

Net cash ~~used in~~generated from financing activities in ~~2008~~2011 amounted to ~~$72.9~~$25.7 million and consisted of ~~$120.6~~$37.0 million of proceeds from the issuance of long-term debt drawn for the acquisition of them/v Moon Globe andm/v Sun Globe, $20.0 million of proceeds from the issuance of share capital, net of transaction costs, reduced by $22.3 million of indebtedness that we repaid under our ~~then-existing~~existing credit and loan facilities, ~~$21.4 million which was pledged in favor of the bank, $0.3~~$1.0 million of ~~loan fees paid, $18.5~~pledged cash, $5.1 million of dividends paid, ~~to shareholders and $7.8~~$2.7 million of interest paid ~~on our loans. Net cash generated by financing activities in 2008 consisted of $95.0~~and $0.2 million of ~~proceeds drawn under our then-existing credit and~~ loan ~~facilities and $0.7 million release of restricted cash.~~

fees.

Indebtedness

We operate in a capital intensive industry which requires significant amounts of investment, and we fund a portion of this investment through long-term bank debt.

As of December 31, ~~2010, 2009~~2013, 2012 and ~~2008,~~2011, we and our vessel-owning subsidiaries had outstanding borrowings under our ~~credit facility from~~ Credit ~~Suisse~~Facility, the Kelty Loan Agreement the DVB Loan Agreement and ~~a loan from Deutsche Schiffsbank~~our Firment Credit Facility of an aggregate of ~~$96.7~~$91.5 million, ~~$70.6~~$105.9 million and ~~$157.6~~$111.4 million, respectively.

~~Credit Suisse~~

Credit Facility

General

In November 2007, we entered into a $120.0 million secured reducing revolving ~~credit facility~~Credit Facility with Credit Suisse AG, which we have supplemented from time to time. Our ~~credit facility~~Credit Facility is available to us in connection with vessel acquisitions by our vessel-owning subsidiaries as well as for working capital purposes. Our ~~credit facility~~Credit Facility had an original term of eight years and has a remaining term as of December 31, ~~2010,~~2013, of approximately ~~4.9~~1.9 years.

Our ~~credit facility~~Credit Facility permits us to borrow funds up to the reducing facility limit which began at $120.0 million and which is reduced on “Reduction Dates” every six months (in May and November) according to the following agreed schedule: (1) by $10.0 million on each of the first to fourth Reduction Dates, inclusive, (2) by $4.5 million on each of the fifth to fifteenth Reduction Dates, inclusive, and (3) by $30.5 million on the sixteenth and final Reduction Date, which is November 2015. Consequently, on every Reduction Date that the outstanding balance exceeds the applicable reduced facility limit, we must pay a principal installment to the bank to ensure that the outstanding balance remains at or below the applicable facility limit. As of December 31, 2010, we had a $71.0 million outstanding balance under the credit facility, which was equal to the reduced facility limit. We therefore could not draw down any additional funds thereunder.

We can voluntarily prepay principal installments to the bank without penalty at any time between Reduction Dates. Such voluntarily prepaid principal amounts become undrawn amounts under the ~~credit facility~~Credit Facility and we can re-borrow such amounts, or parts thereof, subject to the reducing facility limit. Our ~~credit facility~~Credit Facility has commitment fees of 0.25% per annum on any undrawn amounts under the facility,other than undrawn amounts ~~currently~~ relating to approximately $14.9 million, in which the commitment fee is 0.5%. Interest on outstanding balances iswas payable at 0.95% per annum over LIBOR, except when the aggregate security value of the mortgaged vessels is more than 200% of the outstanding balances, in which case the interest iswas 0.75% per annum over LIBOR.

The interest rate, however, has changed as of March 31, 2014. Please see “–Revisions to Credit Facility” below.

Our ability to borrow amounts under our ~~credit facility~~Credit Facility is subject to satisfaction of certain customary conditions precedent and compliance with terms and conditions included in our ~~credit facility~~Credit Facility documentation. To the extent that the vessels in our fleet that secure our obligations under our ~~credit facility~~Credit Facility are insufficient to satisfy minimum security requirements, we will be required to grant additional security or obtain a waiver or consent from the lender.

Security

Our obligations under our ~~credit facility~~Credit Facility are currently secured by a first preferred mortgage on ~~one or more vessels in our fleet, currently on~~ four vessels (them/v Tiara Globe,m/v River Globe,m/v Sky Globe andm/v Star Globe), and such other vessels that we may from time to time include with the approval of our ~~lender, and~~lender. Our Credit Facility is also secured by a first priority assignment of any time charter or other contract of employment of any vessel that acts as security, a first priority account pledge over the operating account of the vessel-owning company and an assignment of the vessel’s insurances and earnings. We may grant additional security from time to time in the future. Each of the vessel-owning subsidiaries that owns a vessel pledged as security under our ~~credit facility~~Credit Facility has guaranteed our obligations under the facility.

Covenants

Our ~~credit facility~~Credit Facility contains financial and other covenants. During December 2012, we were in breach of certain covenants ~~requiring us, among other things,~~of our Credit Facility and therefore in December 2012 reached an agreement with Credit Suisse to ~~ensure~~amend our Credit Facility and waive certain covenants, which agreement was memorialized by a supplemental agreement in March 2013. The covenants as in effect and as amended for the period from December 28, 2012 to March 31, 2014 provided that:

the aggregate charter free- market value of the ~~four~~mortgaged vessels ~~in our fleet financed by our credit facility~~ at all times ismust equal or ~~exceeds~~exceed 110% (instead of 133%) of the outstanding balance under ~~our credit~~the facility, ~~plus the notional or actual cost of terminating any relating hedging arrangements~~ minus the aggregate amount, if any, standing to the credit of our operating accounts or any bank accounts opened with ~~Credit Suisse,~~the lender, which are subject to an encumbrance in favor of ~~Credit Suisse~~the lender and designated as a “security account” by ~~Credit Suisse~~the lender for purposes of the ~~credit facility;~~Credit Facility. As of December 31, 2013 and 2012, the ratio was 172% and 134%, respectively;

Credit Suisse fully waived during the waiver period the requirement that the ratio of our consolidated market adjusted net worth to our total assets to exceed 35% at all times. As of December 31, 2012, the ratio was 20%, corresponding to a $31.7 million shortfall in the fair market value of the Company’s fleet. As of December 31, 2013, the ratio was 37% corresponding to $5.3 million in excess of the required fair market value of the fleet;

Globus must maintain consolidated cash and cash equivalents, to be not less than the greater of (1) $5.0 million (instead of $10.0 million) and (2) the sum determined by the bank to be the aggregate of the total principal amount of all borrowed money and interest accruing thereon, payable by the Company and which falls due in the six-month period commencing on any relevant day;

Globus will not be ~~less than 0.35:1.0;~~permitted to pay dividends on its common shares during the waiver period;

during the waiver period, our Credit Facility will bear interest at LIBOR plus a margin of 2.10%; and

Mr. Feidakis maintains at least 35% of our total issued voting share capital; and

~~we maintain an aggregate of $10.0 million of consolidated cash and cash equivalents.~~

Our ~~credit facility~~Credit Facility also contains general covenants that require us to comply with the ISPS Code, carry all required licenses and provide financial statements to the bank. In addition, our ~~credit facility~~Credit Facility includes customary events of default, including those relating to a failure to pay principal or interest, a breach of covenant, representation and warranty, a cross-default to other indebtedness and non-compliance with security documents. We ~~are~~were permitted to pay dividends in respect of any of our financial quarters (other than during the waiver period described above) so long as we are not in default of our ~~credit facility~~Credit Facility at the time of the declaration or payment of the dividends nor would a default occur as a result of the declaration or payment of such dividends.

As of December 31, 2013, we had a $44.0 million outstanding balance under our Credit Facility which was equal to our Credit Facility. We therefore had no committed amount available to be drawn. The next scheduled semi-annual installment amounting to $4.5 million is due in May 2014.

As of December 31, 2013 and 2012, we were in compliance with the ~~dividends do not exceed 75%~~covenants of our ~~net profit~~Credit Facility, as amended and in effect. We expect that we will be able to comply with the covenants in our Credit Facility for ~~such period.~~

~~Deutsche Schiffsbank~~the next 12 months.

Revisions to Credit Facility

During March 2014, the Company reached an agreement with Credit Suisse on permanently revising certain terms of our Credit Facility as listed below. The Company agreed with Credit Suisse that:

The Company must maintain cash and cash equivalents of not less than $5.0 million conditional on the Company not declaring and paying dividends to common shareholders. In the event of dividend payment, the Company must maintain cash and cash equivalents of not less than $7.0 million and will have to maintain such amount during a continuous period of at least three months following the dividend payment, upon which the minimum amount will be reduced to the $5.0 million requirement.

From March 31, 2014 onwards the Credit Facility will bear interest at LIBOR plus a margin of 1.20%.

The Company is prohibited from paying dividends to the holders of preferred shares in an amount that will exceed $0.5 million per fiscal year when cash and cash equivalents of the Company are less than $7.0 million.

DVB Loan Agreement

In June ~~2010, Kelty Marine Ltd.,~~2011, through our ~~subsidiary that owns the~~ ~~m/v Jin Star~~,wholly owned subsidiaries, Artful Shipholding S.A. and Longevity Maritime Limited, we entered into ~~a $26.7~~the DVB Loan Agreement for an amount up to $40 million ~~loan agreement~~ with ~~Deutsche Schiffsbank~~DVB Bank SE and used ~~the~~ funds borrowed thereunder to ~~pay~~finance part of the purchase price for the ~~vessel.~~m/v Moon Globe andm/v Sun Globe. We act as guarantor for this loan.

In June 2011, $19 million was drawn (Tranche A) for the purpose of partly financing the acquisition of them/v Moon Globe. Tranche A is payable in 30 quarterly installments of $440,000 and a balloon payment of $5.3 million payable together with the 30^th and last installment payable in December 2018. As of December 31, 2013, the outstanding principal balance of Tranche A was $14.1 million. A quarterly installment of $440,000 was paid during March 2014, and the next quarterly installment is due in June 2014.

In September 2011, $18 million was drawn (Tranche B) for the purpose of partly financing the acquisition of them/v Sun Globe. Tranche B is payable in 30 quarterly installments of $416,250 and a balloon payment of $5.0 million payable together with the 30^th and last installment payable in March 2019. As of December 31, 2013, the outstanding principal balance of Tranche B was $13.8 million. A quarterly installment of $416,250 was paid during March 2014 and the next quarterly installment is due in June 2014.

Security

The obligations under the DVB Loan Agreement is secured by a first priority mortgage on them/v Sun Globe and them/v Moon Globe, as well as assignment of the time charters and assignments of earnings, insurances and requisition compensation.

Covenants

The DVB Loan Agreement contains the following provisions:

	Ø	interest on outstanding loan balances to be payable at LIBOR plus 2.5% per annum; and

	Ø	any outstanding amount under the DVB Loan Agreement may be prepaid in a multiple of $500,000 with five days business prior written notice. A variable prepayment fee applies in case of refinancing of the DVB loan agreement by another lender within the first three years of a new loan, but is not applicable in case of the sale of a vessel or repayment of such facility by equity.

During December 2012, we were in breach of certain covenants of the DVB Loan Agreement and therefore in December 2012 reached an agreement with DVB Bank to amend the DVB Loan Agreement and waive certain covenants, which agreement was memorialized by a supplemental agreement in April 2013. The covenants as in effect and as amended for the period from December 31, 2012 to March 31, 2014 provided that:

the aggregate charter free- market value of the mortgaged vessels must equal or exceed 107% (instead of 120% during the first two years and 130% thereafter) of the outstanding balance under the DVB Loan Agreement less any cash held in DVB Bank’s account and pledged to DVB Bank up to $1.0 million. As of December 31, 2012, the aggregate fair market value of the mortgaged vessels was 107% of the outstanding balance under the DVB Loan Agreement less any cash pledged to DVB Bank and subject to $1.0 million prepayment, paid in April 2013. As of December 31, 2013, the aggregate fair market value of the Mortgaged vessels was approximately 160% of the outstanding balance under the DVB Loan Agreement less any cash pledged to DVB Bank;

a quarterly cash sweep mechanism was put into effect in April 2013 and implemented on all vessels mortgaged under the DVB Loan Agreement on an individual vessel basis until the security value exceed 130% of the loan outstanding. Under this mechanism, all earnings of these vessels after operating expenses, dry-docking provision, general and administrative expenses and debt service, if any, are to be used as applied towards the balloon payment of the relevant tranche;

Globus must maintain a minimum market adjusted net worth of more than $20.0 million (instead of $50.0 million) and a minimum liquidity of $5.0 million (instead of the lesser of $10.0 million and $1.0 million per vessel owned by us). As of December 31, 2013 and 2012, the market adjusted net worth of Globus was $56.5 and $27.8, respectively;

the ratio of our market adjusted net worth to our total assets must be greater than 15% (instead of 35%). As of December 31, 2012, the ratio was 20% corresponding to a $31.7 million shortfall in the fair market value of the Company’s fleet when compared to the original minimum requirement of 35%. As of December 31, 2013, the ratio was 37% corresponding to $5.3 million in excess of the required fair market value of the fleet when compared to the original minimum requirement of 35%;

Globus is not permitted to pay dividends on its common shares during the period of the amendment, and is prohibited from paying dividends to the holders of preferred shares in an amount that will exceed $500,000 per fiscal year;

the vessel-owning subsidiaries that own a vessel pledged as security under the DVB Loan Agreement will each maintain a minimum liquidity of $500,000;

Mr. Feidakis and Mr. Karageorgiou maintain at least 35% of our total voting share capital; and

we maintain our listing on a major stock exchange in the United States, Europe or Asia.

The DVB Loan Agreement initially contained a covenant that Mr. Feidakis remain a member of our board of directors and Mr. Karageorgiou remain our chief executive officer. This covenant was waived by DVB Bank in November 2011.

The amendments to the DVB Loan Agreement were subject to $1.0 million prepayment, which was paid in April 2013.

As of December 31, 2013 and 2012, Globus was in compliance with the loan covenants of the DVB Loan Agreement, as amended and in effect. We expect that we will be able to comply with the covenants in the DVB Loan Agreement for the next 12 months.

Kelty Loan Agreement

In June 2010, through our wholly owned subsidiary, Kelty Marine Ltd., we entered into the $26.7 million Kelty Loan Agreement with Deutsche Schiffsbank Aktiengesellschaft (now Commerzbank) and used funds borrowed thereunder to finance part of the purchase price for them/v Jin Star. We act as guarantor for this loan.

The Kelty Loan Agreement has a term of seven years and is payable in 28 equal quarterly installments of $500,000 starting ~~three months after the draw down of the funds,~~in September 2010, as well as a balloon payment of $12.65 million ~~due~~payable together with the 28th28th and final installment ~~due~~payable in June 2017. Interest on outstanding balances under ~~our loan agreement~~the Kelty Loan Agreement is payable at LIBOR plus a variable margin. The applicable margin ~~depends~~is determined on the basis of the “loan to value ratio,” which is a fraction where the numerator is the principal amount outstanding under ~~our loan agreement~~the Kelty Loan Agreement and the denominator is the charter free market value of them/v Jin Star and any amount of free liquidity maintained with ~~Deutsche Schiffsbank.~~Commerzbank. Set forth below is the margin that will apply to the loan, depending on the applicable loan to value ratio in any given application period:

Loan to Value Ratio	Margin

Less than 45%		2.25	%

~~45%~~Equal or greater than 45% and less than or equal to 60%		2.40	%

Greater than 60% and less than or equal to 70%		2.50	%

Greater than 70%		2.75	%

Kelty Marine can prepay the loan in a minimum amount of $1 million and multiples thereof, up to $2 million per year ~~in minimum prepayment amounts of $1 million~~ without any penalty. ~~Our loan agreement~~The Kelty Loan Agreement had a commitment fee of 0.5% per annum on the amount of the undrawn balance of the agreement through September 30, 2010, and had a 0.75% flat management fee on the loan amount. On April 29, 2013, the Company prepaid $3.0 million together with the scheduled installment due on June 28, 2013 against its six following scheduled installment payments. As of December 31, ~~2010, the loan was fully drawn and~~2013, the outstanding principal balance was ~~$25.7 million. The~~$17.6 million and the next quarterly installment is due in March ~~2011.~~

2015.

Security

The loan is secured by a first preferred mortgage on them/v Jin Star, assignment of insurances, earnings and requisition compensation on the vessel and assignment of the bareboat charter.

Covenants

The ~~loan agreement with Deutsche Schiffsbank~~Kelty Loan Agreement contains financial and other covenants requiring Kelty Marine to, among other things, ensure that:

Kelty Marine does not undergo a change of control;

Kelty Marine and/or ~~Globus Maritime~~the Company maintain at least $1 million in minimum ~~liquidity;~~liquidity with Commerzbank;

the ratio of our shareholders’ equity to total assets is not less than 25%;

we must have a minimum equity of $50 million;

the market value of them/v Jin Star and any additional security provided, including the minimum liquidity with Commerzbank, is or exceeds 130% of the aggregate principal amount of debt outstanding under ~~our loan agreement;~~the Kelty Loan Agreement; and

Mr. Feidakis and Mr. Karageorgiou, our founders, maintain in the aggregate at least 37% of the shareholding in us.

~~Our loan agreement~~

The Kelty Loan Agreement permits us to declare and pay dividends without prior written permission of the lender so long as there is no event of default under ~~the loan~~such agreement.

As of March 25, 2011, we have a $71.0 million balance outstanding under our credit facility with Credit Suisse and $25.7 million outstanding under the loan agreement with Deutsche Schiffsbank, and we believe we are currently not in default of our covenants relating to our credit facility and loan agreement.

As of December 31, ~~2010,~~2012, we were not in ~~default~~compliance with the security value requirement that requires the market value of the ~~covenants relating~~m/v Jin Star and any additional security provided, including the minimum liquidity with the lender, to be equal or greater than 130% of the aggregate principal amount of debt outstanding under the Kelty Loan Agreement. In such circumstances, upon request from our ~~credit facility and loan agreement. In addition,~~lender, we had to either provide the lender acceptable additional security with a net realizable value at least equal to the shortfall, or prepay an amount that will eliminate the shortfall, which as of December 31, ~~2010:~~

the reduced facility limit of our credit facility with Credit Suisse was $71.0 million, which equals our debt outstanding under our credit facility as at December 31, 2010. We therefore cannot draw down any additional funds thereunder unless and until we prepay a portion of the debt.; and

~~$25.7 million remained outstanding on the loan agreement with Kelty Marine.~~

2012 amounted to $5.8 million. On April 29, 2013, the Company reached an agreement with Commerzbank and prepaid $3.0 million together with the next scheduled installment due on June 28, 2013 for the Company to be fully compliant with the provisions of the Kelty Loan Agreement.

As of December 31, ~~2008, we were~~2013, Globus was in ~~breach~~compliance with the loan covenants of the Kelty Loan Agreement. We expect that we will be able to comply with the covenants in the Kelty Loan Agreement for the next 12 months.

All our loan ~~to value ratio covenant~~arrangements contain a cross-default provision that provide that if we are in default under any of our loan arrangements, the lender of another loan arrangement can declare a default under its other loan arrangement, which could result in our ~~credit facility, for which we obtained~~default of all of our loan arrangements. Because of the presence of cross-default provisions in our loan arrangements, the refusal of any lender to grant or extend a waiver ~~from the bank~~could result in most of our indebtedness being accelerated, notwithstanding that ~~was valid until January 31, 2010.~~ other lenders have waived covenant defaults under their respective loan arrangements.

As of December 31, ~~2009 and December 31, 2010,~~2011, we were not in breach of any of the provisions of our Credit Facility, the Kelty Loan Agreement or the DVB Loan Agreement.

Firment Credit Facility

In December 2013, the Company entered into a revolving credit ~~facility.~~

Asfacility for up to $4.0 million with Firment Trading Limited, a company related through common control, for the purpose of financing its general working capital needs. The Firment Credit Facility is unsecured and will remain available for 24 months until its final maturity date of December ~~31, 2008, we had breached a loan~~2015, when the Company must repay all drawn and outstanding amounts at that time. The Company has the right to ~~value ratio covenant~~drawdown any amount up to $4.0 million or prepay any amount, during the availability period in multiples of $100,000. Any prepaid amount can be re-borrowed in accordance with the terms of the agreement. Interest on ~~a loan that has since been repaid. In order to rectify such breach, we had pledged an amount of $21.4~~drawn and outstanding amounts is charged at 5% per annum and no commitment fee is charged on the amounts remaining available and undrawn. The Company drew down $2.0 million in ~~favor of the lending bank.~~

December 2013.

Financial Instruments

The major trading currency of our business is the U.S. dollar. Movements in the U.S. dollar relative to other currencies can potentially impact our operating and administrative expenses and therefore our operating results.

In November 2008, in an effort to mitigate the exposure to interest rate movements, we entered into two interest rate swap agreements for a notional amount of $25 million in ~~total, which remain~~total. Both interest rate swap agreements reached maturity in ~~place on the date of this annual report on Form 20-F.~~

November 2013.

We believe that we have a low risk approach to treasury management. Cash balances are invested in term deposit accounts, with their maturity dates projected to coincide with our liquidity requirements. Credit risk is diluted by placing cash on deposit with a variety of institutions in Europe, including a small number of banks in Greece, which are selected based on their credit ratings. We have policies to limit the amount of credit exposure to any particular financial institution.

As of December 31, ~~2010, 2009~~2013, 2012 and ~~2008,~~2011, we did not use and have not used any financial instruments designated in our financial statements as those with hedging purposes.

Capital Expenditures

We make capital expenditures from time to time in connection with our vessel ~~acquisitions. Other than as set forth in this annual report on Form 20-F, we~~acquisitions or vessel improvements. We have no agreements to purchase any additional vessels, but may do so in the future. We expect that any purchases of vessels will be paid for with cash from operations, with funds from new credit facilities from banks with whom we currently transact business, with loans from banks with whom we do not have a banking relationship but will provide us funds at terms acceptable to us, with funds from equity or debt issuances or any combination thereof.

We incur additional capital expenditures when our vessels undergo surveys. This process of recertification may require us to reposition these vessels from a discharge port to shipyard facilities, which will reduce our operating days during the period. The loss of earnings associated with the decrease in operating days, together with the capital needs for repairs and upgrades, is expected to result in increased cash flow needs. We expect to fund these expenditures with cash on hand.

C. Research and Development, Patents and Licenses, etc.

We incur, from time to time, expenditures relating to inspections for acquiring new vessels that meet our standards. Such expenditures are insignificant and they are expensed as they incur.

D. Trend Information

~~Our results of operations depend primarily~~

Please read “Item 4.B. Information on the charter hire and spot market rates that we are able to realize. Charter hire and spot market rates paid for dry bulk vessels are primarily a function of the underlying balance between vessel supply and demand. To the extent that either supply or demand is significantly affected, we believe this would cause rates to fluctuate.

Company—Business Overview.”

E. Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements.

F. Tabular Disclosure of Contractual Obligations

The following table sets forth our contractual obligations and their maturity dates as of December 31, ~~2010:~~

Within
One Year

One to
Three
Years

Three to
Five
Years

More
than
Five
years
Total
(in thousands of U.S. Dollars)
Long term debt(1) $ 11,000 22,000 48,000 15,650 $
96,650
Operating lease obligations(2) 253 525 458 - 1,236

2013:

	Within One Year		One to Three Years		Three to Five Years		More than Five years		Total
	(in thousands of U.S. Dollars)
Long term debt	$	12,425		47,850		25,800		5,429		91,504
Interest on long term debt		1,977		2,475		997		37		5,486
Operating lease obligations(1)		251		170						421

(1) Our long term debt includes both our credit facility with Credit Suisse and Kelty Marine’s loan agreement with Deutsche Schiffsbank, each of which is described in “Item 5.B. Liquidity and Capital Resources—Indebtedness.”

~~(2)~~ We rent our office space from Cyberonica S.A. for an amount of €14,578 per month, which we expect will increase at a rate of 2.5% per year. We ~~expect that the~~assume an average Euro:U.S. dollar exchange rate isof 1.0:1.4.

G. Safe Harbor

See the section entitled “Cautionary Note Regarding Forward-Looking Statements” at the beginning of this annual report on Form 20-F.

Item 6. Directors, Senior Management and Employees

A. Directors and Senior Management

The following table sets forth information regarding our executive officers and our directors. Our articles of incorporation provide for a board of directors serving staggered, three-year terms, other than any members of our board of directors that may serve at the option of the holders of preferred shares, if ~~any.~~any are issued with relevant appointment powers. The term of our Class I directors expires at our annual general meeting of shareholders in ~~2011,~~2014, the term of our Class II directors expires at our annual general meeting of shareholders in ~~2012~~2015 and the term of our Class III directors expires at our annual general meeting of shareholders in ~~2013.~~2016. Officers are appointed from time to time by our board of directors and hold office until a successor is appointed or their employment is terminated. The business address of each of the directors and officers is c/o Globus Shipmanagement Corp., 128 Vouliagmenis Avenue, 3rd Floor, 166 74 Glyfada, Athens, Greece.

Name	~~Position~~	Position		Age
Georgios Feidakis		Chairman of the Board of Directors	60	63
Georgios Karageorgiou		Director, President, ~~and~~ Chief Executive Officer	45
~~Elias S. Deftereos~~	~~Director,~~ and Chief Financial Officer ~~and Secretary~~	50	49
Amir Eilon		Director	62	65
Jeffrey O. Parry		Director	51	54
Athanasios Feidakis		Director		27
Olga Lambrianidou		Secretary		58

Georgios (“George”) Feidakis, a Class III director, is our founder and principal shareholder and has served as chairman of the board of directors since inception. Mr. Feidakis is also the major shareholder and Chairman of FGF.G. Europe S.A., a company Mr. Feidakis has been involved with since 1994 and that has been listed on the Athens Stock Exchange since 1968, and acts as a director and executive for several of its subsidiaries. FG Europe is active in four lines of business and distributes ~~well known~~well-known brands in Greece, the Balkans, Turkey and Italy. FG Europe is in the air-conditioning and white/brown electric goods market in Greece and is active in power generation and mobile telephony. Mr. Feidakis is also the director and chief executive officer of R.F. Energy S.A., a company that plans, develops and controls the operation of energy projects, and acts as a director and executive for several of its subsidiaries.

Georgios (“George”) Karageorgiou, a Class I director, has served as our chief executive officer since our inception and was appointed our president in ~~2011.~~2011 and in January 2013, immediately after the resignation of Mr. Elias Deftereos, our Chief Financial Officer. From 1992 to March 2004, Mr. Karageorgiou worked as a director and corporate secretary for Stelmar Shipping Limited, a shipping company listed on the New York Stock Exchange between 2001 and 2004. Mr. Karageorgiou worked as a projects engineer for Kassos Maritime Enterprises from 1990 to 1992. Mr. Karageorgiou was also a director of easyGroup Ltd, easyJet Holdings Ltd, easyInternetCafe Ltd, easyCruise Ltd, Stelinvest Corp. and a number of other easyGroup subsidiaries from 1995 through March 2005. Mr. Karageorgiou holds a B.E. in Mechanical Engineering and an M.E. in Ocean Engineering from Stevens Institute of Technology and an M.Sc. in Shipping Trade and Finance from City University Business School.

~~Elias S. Deftereos~~, a Class II director, has served as our chief financial officer and a member of our board of directors since April 2007. Mr. Deftereos previously worked as a finance director at Astron Maritime from March 2005 to July 2006 and as the finance director of Konkar Shipping Agencies S.A. from January 2004 to February 2005, each of which company managed fleets of dry bulk vessels. Mr. Deftereos worked as the group treasurer of Mytilineos Holdings from 1999 to 2001, a company listed on the Athens Stock Exchange, and as an investment manager for Lehman Brothers from 1997 to 1998. Mr. Deftereos worked as an account officer for ship financing for ABN AMRO Bank from 1994 to 1996, and an analyst for Olympic Maritime of the Onassis Group from 1988 to 1991. Mr. Deftereos holds a B.A. in Economics from the State University of New York at Buffalo and an MBA in Finance from the University of Chicago.

Amir Eilon, a Class III director, has served as our director since June 2007. Mr. Eilon has been a director of Eilon & Associates Limited since February 1999, which provides general corporate advice. Mr. Eilon was previously a non-executive chairman of Spring plc, listed on the London Stock Exchange, from mid-2004 to August 2009 and a director of Flamingo Holdings, a venture capital backed private company, from March 2007 to April 2009. Mr. Eilon was the managing director of Credit Suisse First Boston Private Equity from 1998 to 1999, the managing director of BZW from 1990 to 1998, where he was head of global capital markets, and the managing director of Morgan Stanley, London from 1985 to 1990, where he was responsible for international equity capital markets.

Mr. Eilon is a Non-Executive Chairman of Intern Avenue, a company that matches companies offering paid intern opportunities to young talent looking for employment, and is a Non-Executive Director of Articheck, a company developing conservatory art software.

Jeffrey O. Parry, a Class II director, has served as our director since July 2010. Mr. Parry is currently the president of Mystic Marine Advisors LLC, a Connecticut-based advisory firm specializing in turnaround and emerging shipping companies, and has been affiliated with such company since August 1998. From July 2008 to October 2009, he was president and chief executive officer of Nasdaq-listed Aries Maritime Transport Limited (now named NewLead Holdings Ltd.). Mr. Parry has also served as the managing director of A.G. Pappadakis & Co. Ltd, an Athens-based shipowner from March 2007 to July 2008, and managing director of Poten Capital Services LLC, a U.S. broker/dealer firm specializing in shipping from February 2003 to March 2007. Mr. Parry holds a B.A. from Brown University and an MBA from Columbia University. Mr. Parry started his career as a stevedore on the New York waterfront.

~~There~~ Mr. Parry is a director of TBS International Ltd since April 2012, and acted as its interim chief executive officer from October 2012 to December 2012.

Athanasios (“Thanos”) Feidakis, was appointed to our board of directors on July 1, 2013 as a Class II director to fill the vacancy created in the Class II directorship and serve until the next election of the term which expires at our annual meeting in 2015. Mr A. Feidakis has worked for our operations and chartering departments from October 2011 to June 2013. Prior to that he trained in London with several shipbroking firms such as Clarksons Ltd. and ACM Shipping, acquiring experience in dry cargo commodities chartering, as well as in the sale and purchase of vessels. Since April 2011, Mr A. Feidakis has been a director of FG Europe. Mr A. Feidakis has been the president of Cyberonica S.A., a family owned company specializing in real estate development, since December 2008. Mr A. Feidakis holds a B.Sc. in Business Studies and a M.Sc. in Shipping Trade and Finance from the Cass Business School (City University London). In addition, he has professional qualifications in dry cargo chartering and operations from the Institute of Chartered Shipbrokers.

Olga Lambrianidou, our secretary, has been a corporate consultant to the Company since November 2010, and was appointed as secretary to the Company in December 2012. Prior to joining us, Ms. Lambrianidou was the Corporate Secretary and Investor Relations Officer of NewLeads Holdings Ltd., formerly known as Aries Maritime Limited from 2008 to 2010, and of DryShips Inc., a dry bulk publicly trading shipping company from 2006 to 2008. Ms. Lambrianidou was Corporate Secretary, Investor Relations Officer and Human Resources Manager with OSG Ship Management (GR) Ltd., formerly known as Stelmar Shipping Ltd. from 2000 to 2006. Prior to 2000, Ms. Lambrianidou worked in the banking and insurance fields in the United States. She holds a BBA Degree in Marketing/English Literature from Pace University and an MBA Degree in Banking/Finance from the Lubin School of Business of Pace University in New York.

Athanasios Feidakis is the son of our Chairman George Feidakis. Other than the aforementioned, there are no other family relationships between any of our directors or senior management. There are no arrangements or understandings with major shareholders, customers, suppliers or others, pursuant to which any person referred to above was selected as a director or member of senior management.

B. Compensation

~~Non-Executive Directors’ Fees~~

~~In 2010, 2009~~

The aggregate compensation, other than share based compensation paid to members of our senior management in 2013, 2012 and ~~2008, fees in cash to non-executive directors amounted to $124,000, $143,000~~2011, was approximately $0.2 million, $0.2 million and ~~$158,000,~~$0.8 million, respectively. In addition, ~~to that,~~our senior management received no shares in ~~2010, 2009 and 2008, non-executive directors~~2013, received an aggregate of ~~2,822 common shares, 8,477~~72,410 common shares and ~~3,100~~3,347 Series A Preferred Shares in 2012 and 33,563 common shares ~~respectively. We reimburse~~in 2011. The aggregate compensation other than share based compensation paid to our non-executive directors in 2013, 2012 and 2011 was approximately $165,000, $145,000 and $145,000, respectively, plus reimbursements for actual expenses incurred while acting in their capacity as a director.

~~Executives~~

~~Globus Shipmanagement has entered into employment agreements with each of Mr. Karageorgiou~~ In addition, in 2013, 2012 and Mr. Deftereos for work performed in Greece and we have entered into separate consulting agreements with companies wholly owned by each of them for them to assist and advise the chief executive officer and chief financial officer, respectively, in respect of his duties performed outside of Greece.

~~Compensation Philosophy and Objectives~~

We believe that our executive compensation program should reward executives for enhancing our long-term performance while delivering favorable annual operating results. The Remuneration Committee evaluates both performance and compensation so that we may attract and retain superior executives and maintain compensation competitive to that of our peer companies for similarly situated executives. The principal components of compensation for our executives currently are salary, annual cash bonuses and equity awards in the form of common shares issued pursuant to our long term incentive plan.

~~Annual Salary and Bonus~~

The salaries of our executive officers are reviewed on an annual basis. Adjustments in salary are based on the evaluation of individual performance, our overall performance during a given financial year and the individual’s contribution to our overall performance. With respect to determining bonuses, the Remuneration Committee considers the following factors:

~~average operating expenses per vessel per day;~~

~~overall fleet utilization;~~

~~average overhead burden per vessel per day (excluding corporate-related expenses);~~

~~unplanned incidents;~~

~~drydocking budget performance; and~~

~~growth in earnings before interest, taxes, depreciation and amortization (EBITDA).~~

~~An individual may not be granted a bonus in excess of 100% of his annual base salary in any fiscal year.~~

~~The aggregate compensation, excluding share based compensation, to our executive officers was $0.7 million for 2010, $0.9 million for 2009 and $0.8 million for 2008. They also~~2011, non-executive directors received an aggregate of ~~29,521~~19,841 common shares, ~~in 2010, 64,203~~15,780 common shares ~~in 2009~~ and ~~4,224~~7,800 common shares, ~~in 2008.~~

respectively.

Our Greek employees are bound by Greek labor law, which provides certain payments to these employees upon their dismissal or retirement. We have accrued as of December 31, 2013 a non-current liability of $64,000 for such payments.

We do not have a retirement plan for our officers or directors.

C. Board Practices

Our board of directors and executive officers will oversee and supervise our operations.

~~Mr. Parry has a letter of appointment, which contains a provision that the director may be terminated by us upon three months’ notice.~~

Each director holds office until his successor is elected or appointed, unless his office is earlier vacated in accordance with the articles of incorporation or with the provisions of the BCA. In addition to cash compensation, we ~~intend to~~ pay toeach of Mr. Eilon, ~~and the letter of appointment with~~ Mr. Parry ~~provides that we will pay to~~and Mr. ~~Parry,~~Athanasios Feidakis $20,000 in ~~our~~common shares annually. If Mr. Parry ceases to be a director as a result of a change of control in us, then he will immediately receive the number of shares that he would have otherwise received had his appointment been for two years. The members of our senior management are appointed to serve at the discretion of our board of directors. Our board of directors and committees of our board of directors schedule regular meetings over the course of the year. Under the Nasdaq rules, we believe that Mr. Eilon and Mr. Parry are independent.

We have an Audit Committee, a Remuneration Committee and a Nomination Committee.

The Audit Committee is comprised of Amir Eilon and Jeffrey O. Parry. It is responsible for ensuring that our financial performance is properly reported on and monitored, for reviewing internal control systems and the auditors’ reports relating to our accounts and for reviewing and approving all related party transactions. Our board of directors has determined that Amir Eilon is our audit committee financial expert. Each Audit Committee member has experience in reading and understanding financial statements, including statements of financial position, statements of comprehensive income and statements of cash flows.

The Remuneration Committee is comprised of Athanasios Feidakis (who succeeded George Feidakis on February 20, 2014), Amir Eilon and Jeffrey O. Parry. It is responsible for determining, subject to approval from our board of directors, the remuneration guidelines to apply to our executive officers, secretary and other members of the executive management as our board of directors designates the Remuneration Committee to consider. It is also responsible for ~~determining~~suggesting the total individual remuneration packages of each director including, where appropriate, bonuses, incentive payments and share options. The Remuneration Committee is responsible for declaring dividends on our Series A Preferred Shares, if any. The Remuneration Committee will also liaise with the Nomination Committee to ensure that the remuneration of newly appointed executives falls within our overall remuneration policies.

While Athanasios Feidakis is not an independent director, we believe that, as a family member of a significant shareholder, who has a substantial vested interest in our success, his particular input will significantly aid and assist us.

The Nomination Committee is comprised of George Feidakis, Amir Eilon and Jeffrey O. Parry. It is responsible for reviewing the structure, size and composition of our board of directors and identifying and nominating candidates to fill board ~~of directors’~~ positions as ~~and when they arise.~~

necessary.

D. Employees

As of December 31, ~~2010,~~2013, we had approximately ~~nine~~thirteen full-time employees and ~~six~~three consultants, ~~including the senior management,~~ all of whom were hired through ~~Globus Shipmanagement.~~our Manager. All of these employees are located in Greece and are engaged in the service and management of our fleet. None of our employees are covered by collective bargaining agreements, although certain crew members are parties to collective bargaining agreements. We do not employ a significant number of temporary employees.

E. Share Ownership

With respect to the total number of common shares owned by all of our officers and directors, individually and as a group, ~~see~~please read “Item 7. Major Shareholders and Related Party Transactions.”

~~Long Term Incentive Plan~~

Incentives program

We allocate a portion of annual compensation to awards of our common shares, or awards, under our long term incentive ~~plan,~~program, because we believe that equity awards are important to align our employees’ interests with those of our shareholders. Our long term incentive ~~plan~~program is administered by our Remuneration Committee.

The Remuneration Committee generally measures our performance in terms of total shareholder return, which is calculated based on changes in our share price and our dividends paid over a calendar year, which we refer to as TSR.

Our board of directors believes that these awards will keep our employees focused on our growth, as well as dividend growth and its impact on our share price, over an extended time period. In addition, our board of directors believes ~~the~~a gradual vesting schedule of ~~these~~ awards will help us retain both our executive officers and key employees. ~~The amount of awards we grant to any person under our long term incentive plan is subject to the performance condition as set out below.~~

~~Grant of Awards~~

Awards are generally granted on an annual basis. Awards may generally only be granted in the period of four weeks commencing on the day following any amendment to our long term incentive plan taking effect; or an announcement by us of our results for any period, or the issue by us of a prospectus or similar document. The grant of any awards under our long term incentive plan will be subject to performance conditions.

~~Performance Condition~~

The Remuneration Committee generally compares our performance in terms of total shareholder return, which is calculated based on changes in share price and dividends paid over a calendar year, and which we refer to as TSR, relative to a peer group of publicly listed dry bulk shipping companies. The current peer group that we use is comprised of the following companies, which is subject to change at the discretion of our Remuneration Committee:

~~United Kingdom: Hellenic Carriers Ltd. and Goldenport Holdings Inc.; and~~

United States: Diana Shipping Inc., Excel Maritime Carriers Ltd., Paragon Shipping Inc., DryShips Inc., Eagle Bulk Shipping Inc., Euroseas Ltd., FreeSeas Inc., Genco Shipping & Trading Limited, OceanFreight Inc. and Seanergy Maritime Holdings Corp.

~~We believe that TSR, measured relative to the performance of comparable companies, is the best way of evaluating our performance and measuring value creation for shareholders.~~

If, on the purported date of grant, we rank below the twentieth percentile within the peer group, then no awards may be granted. If we achieve or exceed the twentieth percentile, the number of common shares which may be made subject to an award to a particular individual on the date of grant shall be restricted to a percentage of the “individual limit” referred to below. This percentage shall be calculated on a straight-line basis from 17.5% of the individual limit (if we achieve the twentieth percentile) to the maximum value we are permitted to grant under our long term incentive plan (if we achieve the hundredth percentile and therefore rank first compared to our then existing peer group). These targets will be reviewed annually.

~~Individual Limit~~

In any fiscal year, no participant may be granted awards over common shares with a market value (on the relevant date(s) of grant) in excess of 200% of the aggregate of the participant’s annual salary and bonus.

~~Vesting of Awards~~

Subject to what is set out below, awards vest proportionally over a three-year period from their date of grant and vested common shares subject to awards will be delivered to participants within the 30 days that follow the first, second and third anniversaries of the date of grant of the relevant award. If the participant is summarily dismissed from his employment, his award in respect of vested and unvested common shares will lapse in its entirety. In all other circumstances of cessation of employment (unless the Remuneration Committee acting in its absolute discretion otherwise determines), the participant shall retain his vested award but any unvested award shall lapse. Vested common shares subject to awards in such circumstances will be delivered to participants within the 30 days that follow cessation of employment.

~~Lock In~~

~~After shares are issued under our long term incentive plan, they are subject to a one-year “lock-in” period pursuant to the terms of our long term incentive plan.~~

~~Overall Limit~~

Not more than 10% of our issued share capital (including shares held in treasury) may be made subject to awards or options granted under our long term incentive plan or any other share-based employee incentive plan established by us in any ten-year period.

~~2010~~

2013 Grants

No awards were granted ~~for~~during the year ended December 31, 2013.

2012 Grants

Our board of directors determined in February 2012 to grant two conditional equity settled awards to our then two executive officers.

A conditional equity settled award of 51,729 and 19,214 common shares of Globus was granted to our chief executive officer and chief financial officer, respectively, subject to the award holders continuing their employment until December 31, 2013. 100% of the shares granted would have vested at December 31, 2013 if the average TSR from January 1, 2011 to December 31, 2013 was equal to or greater than 10%, and the number of shares vested would have been prorated if TSR was calculated to be less than 10%. In addition, 100% of the shares granted would have vest if our average net income from January 1, 2011 through December 31, 2013 was 10 times the value of the shares granted (valued at a price of $9.06 per share) and prorated for average net income achieved below the target amount. The award lapsed on December 31, 2013 without any shares being vested.

A conditional equity settled award of 137,029 common shares and 50,896 common shares of Globus was granted to our chief executive officer and chief financial officer respectively, subject to the award holders continuing their employment until December 31, 2014. 100% of shares granted will vest at December 31, 2014 if the average TSR from January 1, 2012 to December 31, 2014 is equal to or greater than 10%, and the number of shares vesting will be prorated if TSR is calculated to be less than 10%. In addition, 100% of the shares granted will vest if our average net income from January 1, 2012 through December 31, 2014 is 10 times the value of the shares granted (valued at a price of $3.31 per share) and prorated for average net income achieved below the target amount.

2011 and 2010 Grants

No awards were granted during the years ended December 31, 2011 and 2010.

2009 Grants

On December 10, 2009, we granted to our two executive officers and a number of managers and staff of our ~~wholly owned subsidiary Globus Shipmanagement~~Manager a conditional award of 575,199 shares, which following our four-for-one reverse split of our common shares, became an effective award of 143,799, with a conditional right for the shares to be allotted and delivered to them in the future at no ~~cost.~~cost, subject to the employees continuing service. These shares were to vest on a daily basis over the next three years, and one third of these shares were to be allotted and delivered to them at nil cost on each of the first, second and third anniversaries of the grant date. If a cash dividend iswas paid during the vesting period, additional shares ~~will be~~were granted and calculated in accordance with the terms of our long term incentive plan. Due to the cash dividends declared and paid during ~~September and~~the three year vesting period from December ~~2010,~~10, 2009 to December 10, 2012, an additional ~~2,865~~14,118 common shares of the Company were added to the initially granted ~~shares.~~shares and 4,973 common shares were forfeited. On December 10, 2010, 2011 and 2012, the first, second and third anniversary of the ~~2009 grant,~~award, 47,823, 52,989 and 52,132 common shares, respectively, were issued and delivered to the relevant award holders. ~~The outstanding award, as of December 31, 2010, adjusted for the effects of dividends paid, award forfeitures, reverse split and common shares allotted and delivered became as follows:~~

255,536 ordinary shares were granted to George Karageorgiou, our president and chief executive officer, which following our four-for-one reverse split of our common shares, dividends paid and common shares vested and delivered, became an effective award remaining to be vested of 43,634;

94,679 ordinary shares were granted to Elias Deftereos, our chief financial officer, which following our four-for-one reverse split of our common shares, dividends paid and common shares vested and delivered, became an effective award remaining to be vested of 16,167; and

224,984 ordinary shares were granted to fourteen managers and staff of Globus Shipmanagement, which following our four-for-one reverse split of our common shares, dividend paid, award forfeitures and common shares vested and delivered, became an effective award remaining to be vested of 37,080.

Our long term incentive plan provides that these shares vest on a daily basis over a three year period starting from the date of grant, and one-third of these shares will be allotted and delivered to them at no cost on each of the first, second and third anniversaries, subject to their continuing employment.

There are no other outstanding awards.

Item 7. Major Shareholders and Related Party Transactions

A. Major Shareholders

The following table sets forth information concerning ownership of our common shares as of ~~March 25, 2011~~April 28, 2014 by persons who beneficially own more than 5.0% of our outstanding common shares, each person who is a director of our company, each executive officer named in this annual report on Form 20-F and all directors and executive officers as a group.

Beneficial ownership of shares is determined under rules of the SEC and generally includes any shares over which a person exercises sole or shared voting or investment power. Except as indicated in the footnotes to this table and subject to community property laws where applicable, the persons named in the table have sole voting and investment power with respect to all shares shown as beneficially owned by them.

The numbers of shares and percentages of beneficial ownership are based on approximately ~~7,289,688~~10,231,252 common shares ~~outstanding.~~outstanding on April 28, 2014. All common shares owned by the shareholders listed in the table below have the same voting rights as the other of our outstanding common shares.

The address for those individuals for which an address is not otherwise indicated is: c/o Globus Shipmanagement Corp., 128 Vouliagmenis Avenue, 3rd Floor, 166 74 Glyfada, Athens, Greece.

Name and address of beneficial owner
Number of common shares
beneficially owned as of
March 25, 2011

Percentage of common shares
beneficially owned as of
March 25, 2011

George Feidakis(1)
4,474,475 61.4 %
George Karageorgiou(2)
271,697 3.7 %
Ioannis Panayiotopoulos(3)
428,928 5.9 %
Commerzbank AG(4)
481,615 6.6 %
Elias S. Deftereos 22,981 *
Amir Eilon 10,401 *
Jeffrey O. Parry 472 *

All executive officers and directors as a group (five persons) 4,780,026 65.6 %

Name and address of beneficial owner	Number of common shares beneficially owned as of April 28, 2014		Percentage of common shares beneficially owned as of April 28, 2014
5% Beneficial Owners
Broadbill Investment Partners, LLC (1)		537,269		5.3	%
Officers and Directors
George Feidakis (2)		5,204,475		50.9	%
George Karageorgiou		354,184		3.4	%
Amir Eilon		32,698		*
Jeffrey O. Parry		21,769		*
Athanasios Feidakis		382,296		3.7	%
All executive officers and directors as a group (five persons)		5,995,422		58.6	%

*Less than 1.0% of the outstanding shares.

(1) Based on information obtained in a Schedule 13G/A, filled with the SEC on February 14, 2014. The Schedule 13G/A was jointly filed by Broadbill Investment Partners, LLC and Broadbill Partners GP, LLC (together with Broadbill Investment Partners, LLC, the “Reporting Persons”) with respect to our common shares owned by Broadbill Partners, L.P., a Delaware limited partnership and Broadbill Partners II, L.P., a limited partnership. The address of the principal business office of each of the Reporting Persons is Broadbill Investment Partners, LLC, 527 Madison Avenue, 6th Floor, New York, New York 10022.

(2) Mr. George Feidakis beneficially owns 4,724,475 of his common shares through Firment Trading Limited, a Cypriot company, for which he exercises sole voting and investment power through two companies that hold Firment Trading’s shares in trust for Mr. Feidakis. Mr. Feidakis beneficially owns 480,000 common shares through F.G. Europre S.A., a Greek company of which Mr. Feidakis is the majority shareholder. Mr. Feidakis andFirment Trading Limited disclaim beneficial ownership over such common shares except to the extent of ~~the voting and dispositive~~their pecuniary interests in such shares.

~~(2) Mr. George Karageorgiou beneficially owns his common shares through Kim Holdings S.A., a Marshall Islands company, for which we believe he exercisessole voting and investment power.~~

~~(3) Mr. Ioannis Panayiotopoulos beneficially owns his common shares through Lipati Shipping Company Limited, a Cypriot company, for which we believe he exercises~~sole voting and investment power. Its address is 56 Pindou Street, Halandri, 152 33 Athens, Greece. Mr. Panayiotopoulos and Lipati Shipping Company Limited disclaim beneficial ownership over such common shares except to the extent of the voting and dispositive interests in such shares.

~~(4) Commerzbank AG, a publicly traded company in Germany, maintains its address at P.O. Box 52715, 30 Gresham Street, London EC2P 2XY.~~

To the best of our knowledge, except as disclosed in the table above, we are not owned or controlled, directly or indirectly, by another corporation or by any foreign government. To the best of our knowledge, there are no agreements in place that could result in a change of control of us.

In the normal course of business, there have been institutional investors that buy and sell our shares. It is possible that significant changes in the percentage ownership of these investors will occur. ~~Kairos Fund Limited, a company unrelated to us other than by its ownership of our shares, held more than five percent of our shares in 2009 and no longer holds any of our shares.~~

B. Related Party Transactions

~~Consulting Agreements~~

We have entered into separate consulting agreements with companies wholly owned by each of our executive officers for them to assist and advise the chief executive officer and chief financial officer, respectively, in respect of his duties performed outside of Greece.

Lease

During the ~~2010, 2009~~2013, 2012 and ~~2008~~2011 fiscal years, we paid $232,000, ~~$239,000~~$226,000 and ~~$242,000,~~$243,000, respectively, to Cyberonica S.A., a company owned by Mr. George Feidakis, for the rental of 350 square meters of office space for our operations.

~~Brokerage Services~~

Employment of Relative of Mr. Feidakis

In ~~November 2009,~~October 2011, we entered into ~~memoranda~~an employment agreement with Athanasios Feidakis the son of ~~agreement for~~our chairman of the ~~sale of~~ ~~m/v Sea Globe~~ ~~and~~ ~~m/v Coral Globe~~ ~~for an aggregate price of $34 million, for which North South Maritime Ltd. provided brokerage services. The managing director of North South Maritime Ltd, Arjun Batra, was a member of our~~ board of directors ~~who resigned~~and largest beneficial shareholder, Mr. George Feidakis, to act in ~~2010 as~~ a ~~result~~non-managerial position. As of ~~his family’s relocation from the United Kingdom to Singapore. North South Maritime Ltd. received brokerage commission fees of 2.5% on the total sale price~~July 1, 2013, Athanasios Feidakis became a non-executive director of the ~~vessels, which amounted to $850,000.~~

~~Business Opportunities Agreement~~

Company.

Firment Credit Facility

In ~~November 2010, Mr. Feidakis~~December 2013, the Company entered into a ~~business opportunities arrangement with us. Under this agreement, Mr. Feidakis is required~~revolving credit facility for up to disclose to us any business opportunities relating to dry bulk shipping that may arise during his service to us as a member of our board of directors that could reasonably be expected to be a business opportunity that we may pursue. Mr. Feidakis agreed to disclose all such opportunities, and the material facts attendant thereto, to our board of directors for our consideration and if our board of directors fails to adopt a resolution regarding an opportunity within seven business days of disclosure, we will be deemed to have declined to pursue the opportunity, in which event Mr. Feidakis will be free to pursue it. Mr. Feidakis is also prohibited for six months after the termination of the agreement to solicit any of our or our subsidiaries’ senior employees or officers. Mr. Feidakis’ obligations under the business opportunities agreement will also terminate when he no longer beneficially owns our shares representing at least 30% of the combined voting power of all our outstanding shares or any other equity, or no longer serves as our director. Mr. Feidakis remains free to conduct his other businesses that are not related to dry bulk shipping.

~~Registration Rights Agreement~~

~~In November 2010, we entered into a registration rights agreement~~$4.0 million with Firment Trading Limited, a company related through common control, for the purpose of financing its general working capital needs. The Firment Credit Facility is unsecured and ~~Kim Holdings S.A., pursuant to which we granted to them~~will remain available for 24 months until its final maturity date of December 2015, when the Company must repay all drawn and their affiliates (including Mr. George Feidakis and Mr. George Karageorgiou) and certain of their transferees, the right, under certain circumstances and subject to certain restrictions to require us to register under the Securities Act our common shares held by them. Under the registration rights agreement, these persons haveoutstanding amounts at that time. The Company has the right to ~~request us~~drawdown any amount up to ~~register~~$4.0 million or prepay any amount, during the ~~sale~~availability period in multiples of shares held by them on their behalf and may require us to make available shelf registration statements permitting sales of shares into the market from time to time over an extended period. In addition, these persons have the ability to exercise certain piggyback registration rights$100,000. Any prepaid amount can be re-borrowed in ~~connection with registered offerings requested by shareholders or initiated by us.~~

~~Relationship Agreement~~

In May 2007, we, Firment Trading Limited and Mr. George Feidakis entered into a relationship agreement, which provided that Firment Trading is entitled to appoint the chairman of our board of directors for so long as Firment Trading and Mr. Feidakis held directly or indirectly at least 30% of our outstanding shares. The agreement also provided, among other things, that Firment Trading and Mr. Feidakis would not compete with us, and contained provisions relating to related party transactions. This agreement was terminated in November 2010. In connection with such termination, we intend to issue one preferred share to Mr. Feidakis or his affiliate that will provide the holderaccordance with the ~~ability to appoint any one person to be a director, who may also be the chairman of our board of directors, for so long as such holder and his or its affiliates also hold in the aggregate at least 30%~~terms of the ~~voting power of our shares. Such preferred share will have~~agreement. Interest on drawn and outstanding amounts is charged at 5% per annum and no ~~voting or dividend rights.~~

commitment fee is charged on the amounts remaining available and undrawn. The Company drew down $2.0 million in December 2013.

C. Interests of Experts and Counsel

Not Applicable.

Item 8. Financial Information

A. Consolidated Statements and Other Financial Information

See Item 18.

Legal Proceedings

We have not been involved in any other legal proceedings which may have, or have had, a significant effect on our business, financial position, results of operations or liquidity, nor are we aware of any other proceedings that are pending or threatened which may have a significant effect on our business, financial position, results of operations or liquidity. From time to time, we may be subject to legal proceedings and claims in the ordinary course of business, principally personal injury and property casualty claims. We expect that these claims would be covered by insurance, subject to customary deductibles. Those claims, even if lacking merit, could result in the expenditure of significant financial and managerial resources.

Our Dividend Policy and Restrictions on Dividends

Our dividend policy is to pay to holders of our shares a variable quarterly dividend in excess of 50% of the net income of the previous quarter subject to any reserves our board of directors may from time to time determine are required. We believe this policy maintains an appropriate level of dividend cover taking into account the likely effects of the shipping cycle and the need to retain cash to reinvest in vessel acquisitions.

In calculating our dividend to holders of our shares, we exclude any gain on the sale of vessels and any unrealized gains or losses on derivatives. Our board of directors, in its discretion, can determine in the future whether any capital surpluses arising from vessel sales are included in the calculation of a dividend. Dividends will be paid in U.S. dollars equally on a per-share basis between our common shares and our Class B shares, to the extent any are issued and outstanding.

Our Remuneration Committee will also determine by unanimous resolution, in its sole discretion, when and to the extent dividends are paid to the holders of our Series A Preferred Shares.

We are a holding company, with no material assets other than the shares of our subsidiaries. Therefore, our ability to pay dividends depends on the earnings and cash flow of those subsidiaries and their ability to pay dividends to us. Additionally, the declaration and payment of any dividend is subject at all times to the discretion of our board of directors and will depend on, among other things, our earnings, financial condition and anticipated cash requirements and availability, additional acquisitions of vessels, restrictions in our debt arrangements, the provisions of Marshall Islands law affecting the payment of distributions to shareholders, required capital and ~~drydocking~~dry-docking expenditures, reserves established by our board of directors, increased or unanticipated expenses, a change in our dividend policy, additional borrowings orand future issuances of securities, ~~and other factors,~~ many of which ~~will be~~are beyond our control.

Marshall Islands law generally prohibits the payment of dividends other than from surplus (retained earnings and the excess of consideration received from the sale of shares above the par value of the shares) or while a company is insolvent or would be rendered insolvent by the payment of such dividend.

~~As a company listed on the AIM, we~~

We historically paid dividends to our common shareholders in amounts ranging from $0.03 per share to $0.50 per share. ~~We did~~Historical dividend payments should not ~~declare~~provide any promise or ~~pay~~indication of future dividend payments.

No dividends ~~in 2009. In September 2010, we~~were declared or paid on our common shares during the year ended December 31, 2013.

Dividends declared and paid ~~a cash dividend of approximately U.S.$0.11 (GB 7.3 pence) per outstanding common share, and in~~on our Series A Preferred shares during the year ended December ~~2010 we~~31, 2013 are as follows:

2013

$ per share

$000’s

Date declared

Date Paid

1st Preferred dividend

63.46

163

May 30, 2013

July 12, 2013

2nd Preferred dividend

65.20

167

December 27, 2013

January 15, 2014

330

Dividends declared and paid ~~a cash dividend of $0.16 per share. In February 2011, a quarterly dividend of $0.16 per share relating to~~on our common shares during the ~~three months~~year ended December 31, ~~2010 was~~2012 are as follows:

2012

$ per share

$000’s

Date declared

Date Paid

Quarterly dividend for 2011

0.16

1,622

February 28, 2012

March 22, 2012

Quarterly dividend for 2012

0.085

862

May 8, 2012

May 31, 2012

2,484

Dividends declared byand paid on our ~~board~~Series A Preferred shares during the year ended December 31, 2012 are as follows:

2012

$ per share

$000’s

Date declared

Date Paid

1st Preferred dividend

80.00

268

May 8, 2012

2nd Preferred dividend

37.50

125

September 5, 2012

3rd Preferred dividend

39.75

133

December 4, 2012

526

From December 31, 2012 through March 31, 2014 we were prohibited from paying dividends to our common shareholders under our amended loan arrangements. Under the terms of ~~directors, which was paid~~our recently agreed amendment to our Credit Facility, we are prohibited under certain circumstances from paying dividends to the holders of our preferred shares in ~~March 2011.~~an amount that exceeds $500,000 per fiscal year. Please see “Item 5.B. Liquidity and Capital Resources—Indebtedness.”

B. Significant Changes

There have been no significant changes since the date of the annual consolidated financial statements included in this annual report on Form 20-F.

Item 9. The Offer and Listing

Our common shares began trading in the United Kingdom on the London Stock Exchange through the AIM on June 6, 2007 under the stock symbol “GLBS.L.” All such trades were conducted with pounds sterling. Our common shares were suspended from trading on the AIM as of November 24, 2010 and were delisted from the AIM on November 26, 2010.

On November 24, 2010, we redomiciled into the Marshall Islands pursuant to the BCA and a resale registration statement for our common shares was declared effective by the SEC. Once the resale registration statement was declared effective by the SEC, our common shares began trading on the Nasdaq Global Market under the ticker “GLBS.”

The following table lists the high and low sales prices on the AIM and the Nasdaq Global Market, as applicable, for our common shares for the last six months; the last ~~ten~~nine fiscal quarters; and the last ~~four~~five fiscal years (since we began trading on the AIM).

On July 29, 2010, we effected a four-for-one reverse split of our common shares. Prices indicated below with respect to our common share price include inter-dealer prices, without retail mark up, mark down or commission and may not necessarily represent actual transactions. All prices are quoted in U.S. dollars, using a using an exchange rate of U.K. pounds sterling:U.S. dollar of 1.0:1.6.

Period Ended High Low

Monthly
February 28, 2011 $ 9.53 $ 7.94
January 31, 2011 $ 10.50 $ 7.93
December 31, 2010 $ 13.59 $ 8.99
November 30, 2010 $ 13.00 $ 11.90
October 31, 2010 $ 10.16 $ 10.03
September 30, 2010 $ 10.32 $ 8.88

Quarterly
December 31, 2010 $ 13.59 $ 8.99
September 30, 2010 $ 10.32 $ 8.64
June 30, 2010 $ 8.96 $ 7.84
March 31, 2010 $ 8.00 $ 6.05
December 31, 2009 $ 6.21 $ 3.78
September 30, 2009 $ 4.93 $ 3.94
June 30, 2009 $ 6.98 $ 3.2
March 31, 2009 $ 5.25 $ 2.82

Yearly
December 31, 2010 $ 13.59 $ 6.05
December 31, 2009 $ 6.98 $ 2.82
December 31, 2008 $ 35.52 $ 4.16
December 31, 2007 $ 40.00 $ 19.20

Period Ended	High		Low

Monthly
March 2014	$	4.44	$	3.58
February 2014	$	3.71	$	2.98
January 2014	$	3.89	$	3.07
December 2013	$	4.21	$	2.79
November 2013	$	2.94	$	2.57
October 2013	$	3.24	$	2.57

Quarterly
First Quarter 2014	$	4.44	$	2.98
Fourth Quarter 2013	$	4.21	$	2.57
Third Quarter 2013	$	3.35	$	1.88
Second Quarter 2013	$	2.98	$	1.87
First Quarter 2013	$	2.51	$	1.70
Fourth Quarter 2012	$	2.54	$	1.48
Third Quarter 2012	$	3.19	$	2.15
Second Quarter 2012	$	5.29	$	2.81
First Quarter 2012	$	5.77	$	3.90

Yearly
2013	$	4.21	$	1.70
2012	$	5.77	$	1.48
2011	$	10.92	$	2.50
2010	$	13.59	$	6.05
2009	$	6.98	$	2.82

Item 10. Additional Information

A. Share Capital

Not Applicable.

B. Memorandum and Articles of Association

Purpose

Our objects and purposes, as provided in Section 1.3 of our articles of incorporation, are to engage in any lawful act or activity for which corporations may now or hereafter be organized under the BCA.

Common Shares and Class B Shares

Generally, Marshall Islands law provides that the holders of a class of stock of a Marshall Islands corporation are entitled to a separate class vote on any proposed amendment to the relevant articles of incorporation that would change the aggregate number of authorized shares or the par value of that class of shares or alter or change the powers, preferences or special rights of that class so as to affect it adversely. Except as described below, holders of our common shares and Class B shares will have equivalent economic rights, but holders of our common shares will be entitled to one vote per share and holders of our Class B shares will be entitled to 20 votes per share. Each holder of Class B shares (not including the Company and the Company’s subsidiaries) may convert, at its option, any or all of the Class B shares held by such holder into an equal number of common shares.

Except as otherwise provided by the BCA, holders of our common shares and Class B shares will vote together as a single class on all matters submitted to a vote of shareholders, including the election of directors.

The rights, preferences and privileges of holders of our shares are subject to the rights of the holders of any preferred shares that have been issued and which we may issue in the future.

Holders of our common shares do not have conversion, redemption or pre-emptive rights to subscribe to any of our securities.

There is no limitation on the right to own securities or the rights of non-resident shareholders to hold or exercise voting rights on our securities under Marshall Islands law or our articles of incorporation or bylaws.

Preferred Shares

Our articles of incorporation authorize our board of directors to establish and issue up to 100 million preferred shares and to determine, with respect to any series of preferred shares, the rights and preferences of that series, including:

the designation of the series;

the number of preferred shares in the series;

the preferences and relative participating option or other special rights, if any, and any qualifications, limitations or restrictions of such series; and

the voting rights, if any, of the holders of the series (subject to terms set forth below with regard to the policy of our board of directors regarding preferred shares).

Our board of directors may issue preferred shares on terms calculated to discourage, delay or prevent a change of control of us or the removal of management. We intend to issue one preferred share to Mr. Feidakis or his affiliate that will provide the holder with the ability to appoint any one person to be a director, who may also be the chairman of our board of directors, for so long as such holder and his or its affiliates also hold in the aggregate at least 30% of the voting power of our shares. Such preferred share will have no voting or dividend rights.

We issued in April 2012 an aggregate of 3,347 Series A Preferred Shares to our two executive officers, and 2,567 Series A Preferred Shares remain outstanding. The holders of our Series A Preferred Shares will be entitled to receive, if funds are legally available, dividends payable in cash in an amount per share to be determined by unanimous resolution of our Remuneration Committee, in its sole discretion. Our board of directors or Remuneration Committee will determine whether funds are legally available under the BCA for such dividend. Any accrued but unpaid dividends will not bear interest. Except as may be provided in the BCA, holders of our Series A Preferred Shares do not have any voting rights. Upon our liquidation, dissolution or winding up, the holders of our Series A Preferred Shares will be entitled to a preference in the amount of the declared and unpaid dividends, if any, as of the date of liquidation, dissolution or winding up. Our Series A Preferred Shares are not convertible into any of our other capital stock.

The Series A Preferred Shares are redeemable at the written request of the Remuneration Committee, at par value plus all declared and unpaid dividends as of the date of redemption plus any additional consideration determined by a unanimous resolution of the Remuneration Committee. We redeemed and cancelled 780 Series A Preferred Shares in January 2013.

Liquidation

In the event of our dissolution, liquidation or winding up, whether voluntary or involuntary, after payment in full of the amounts, if any, required to be paid to our creditors and the holders of preferred shares, our remaining assets and funds shall be distributed pro rata to the holders of our common shares and Class B shares, and the holders of common shares and the holders of Class B shares shall be entitled to receive the same amount per share in respect thereof.

Dividends

Declaration and payment of any dividend is subject to the discretion of our board of directors. The timing and amount of dividend payments to holders of our shares will depend on a series of factors and risks described under “Item 3.D. Risk Factors,” and includes risks relating to earnings, financial condition, cash requirements and availability, restrictions in our current and future loan arrangements, the provisions of the Marshall Islands law affecting the payment of dividends and other factors. The BCA generally prohibits the payment of dividends other than from paid-in capital in excess of par value and our earnings or while we are insolvent or if we would be rendered insolvent upon paying the dividend.

Subject to preferences that may apply to any shares of preferred stock outstanding at the time, the holders of our common shares and Class B shares will be entitled to share equally in any dividends that our board of directors may declare from time to time out of funds legally available for dividends.

Conversion

Our common shares will not be convertible into any other shares of our capital stock. Each of our Class B shares will be convertible at any time at the election of the holder thereof into one of our common shares. All conversions will be effected on a one-for-one basis. We will not reissue or resell any Class B shares that shall have been converted into common shares.

Directors

Our directors will be elected by the vote of the plurality of the votes cast by holders with voting power of our voting shares. Our articles of incorporation provide that our board of directors must consist of at least three members. Shareholders may change the number of directors only by the affirmative vote of holders of a majority of the total voting power of our outstanding capital stock (subject to the rights of any holders of preferred shares). The board of directors may change the number of directors only by a majority vote of the entire board of directors. We intend to issue one preferred share to Mr. Feidakis or his affiliate that will provide the holder with the ability to appoint any one person to be a director, who may also be the chairman of our board of directors, for so long as such holder and his or its affiliates also hold in the aggregate at least 30% of the voting power of our shares. Such preferred share will have no voting or dividend rights.

No contract or transaction between us and one or more of our directors or officers will be void or voidable solely for this reason, or solely because the director or officer is present at or participates in the meeting of our board of directors or committee thereof which authorizes the contract or transaction, or solely because his or her or their votes are counted for such purpose, if (1) the material facts as to ~~his~~such director’s interest in such contract or ~~her or their relationship or interest~~transaction and as to ~~the contract~~any such common directorship, officership or ~~transaction~~financial interest are disclosed in good faith or ~~are~~ known to ~~our~~the board of directors or ~~the~~ committee, and the board of directors or committee ~~in good faith authorizes the~~approves such contract or transaction by a vote sufficient for such purpose without counting the ~~affirmative votes~~vote of ~~a majority of the disinterested directors,~~such interested director, or, if the votes of the disinterested directors are insufficient to constitute an act of the board, ~~of directors,~~ by unanimous vote of the disinterested directors; or (2) the material facts as to ~~his~~such director’s interest in such contract or ~~her~~transaction and as to any such common directorship, officership or ~~their relationship~~financial interest are disclosed in good faith or ~~interest and as~~known to the shareholders entitled to vote thereon, and ~~the~~such contract or transaction is ~~specifically~~ approved ~~in good faith~~ by vote of such shareholders.

Our board of directors has the ~~shareholders.~~

authority to fix the compensation of directors for their services.

Classified Board of Directors

Our articles of incorporation provide for a board of directors serving staggered, three-year terms. Approximately one-third of our board of directors will be elected each year.

Removal of Directors; Vacancies

Our articles of incorporation provide that directors may be removed with or without cause upon the affirmative vote of holders of 66-2/3% of the total voting power of our outstanding capital stock. Our bylaws require parties to provide advance written notice of nominations for the election of directors other than the board of directors and shareholders holding 30% or more of the voting power of the aggregate number of our shares issued and outstanding and entitled to vote.

No Cumulative Voting

The BCA provides that shareholders are not entitled to the right to cumulate votes in the election of directors unless our articles of incorporation provide otherwise. Our articles of incorporation prohibit cumulative voting.

Shareholder Meetings

Under our bylaws, annual shareholder meetings will be held at a time and place selected by our board of directors. The meetings may be held in or outside of the Marshall Islands. Special meetings may be called by the chairman of our board of directors, by resolution of our board of directors or by holders of 30% or more of the voting power of the aggregate number of our shares issued and outstanding and entitled to vote at such meeting. Our board of directors may set a record date between 15 and 60 days before the date of any meeting to determine the shareholders that will be eligible to receive notice and vote at the meeting.

Dissenters’ Right of Appraisal and Payment

Under the BCA, our shareholders have the right to dissent from various corporate actions, including ~~any merger~~certain mergers or ~~consolidation~~consolidations or sale of all or substantially all of our assets not made in the usual course of our business, and receive payment of the fair value of their ~~shares.~~shares, subject to exceptions. For example, the right of a dissenting shareholder to receive payment of the fair value of his shares is not available if for the shares of any class or series of stock, which shares at the record date fixed to determine the shareholders entitled to receive notice of and vote at the meeting of shareholders to act upon the agreement of merger or consolidation, were either (1) listed on a securities exchange or admitted for trading on an interdealer quotation system or (2) held of record by more than 2,000 holders. In the event of any further amendment of our articles of incorporation, a shareholder also has the right to dissent and receive payment for his or her shares if the amendment alters certain rights in respect of those shares. The dissenting shareholder must follow the procedures set forth in the BCA to receive payment. In the event that we and any dissenting shareholder fail to agree on a price for the shares, the BCA procedures involve, among other things, the institution of proceedings in the high court of the Republic of the Marshall Islands or in any appropriate court in any jurisdiction in which our shares are primarily traded on a local or national securities exchange to fix the value of the shares.

Shareholders’ Derivative Actions

Under the BCA, any of our shareholders may bring an action in our name to procure a judgment in our favor, also known as a derivative action, provided that the shareholder bringing the action is a holder of common shares both at the time the derivative action is commenced and at the time of the transaction to which the action ~~relates.~~

relates or that the shares devolved upon the shareholder by operation of law.

Amendment to our Articles of Incorporation

Except as otherwise provided by law, any provision in our articles of incorporation requiring a vote of shareholders may only be amended by such a vote. Further, certain sections may only be amended by affirmative vote of the holders of at least a majority of the voting power of the voting shares.

Anti-Takeover Effects of Certain Provisions of our Articles of Incorporation and Bylaws

Certain provisions of our articles of incorporation and bylaws, which are summarized in the following paragraphs, may have an anti-takeover effect and may delay, defer or prevent a takeover attempt or hostile change of control that a shareholder may consider in its best interest, including those attempts that may result in a premium over the market price for our common shares held by shareholders.

Two Classes of Shares

Our Class B shares will have 20 votes per share, while our common shares, which ~~is the only class of shares that is currently outstanding and~~ is the only class of shares listed on an established U.S. securities exchange, will have one vote per share. Because of this share structure, any issuance of Class B shares may cause such holders to be able to significantly influence matters submitted to our shareholders for approval even if such holders and their affiliates come to own significantly less than 50% of the aggregate number of outstanding common shares and Class B shares. This control over shareholder voting could discourage others from initiating any potential merger, takeover or other change of control transaction that other shareholders may view as beneficial and which would require shareholder approval.

Blank Check Preferred Shares

Under the terms of our articles of incorporation, our board of directors has authority, without any further vote or action by our shareholders, to issue up to 100 million shares of blank check preferred shares.

We currently have outstanding 2,567 Series A Preferred Shares. Except as may be provided in the BCA, holders of our Series A Preferred Shares do not have any voting rights.

Classified Board of Directors

Our articles of incorporation provide for a board of directors serving staggered, three-year terms. Approximately one-third of our board of directors will be elected each year. This classified board of directors provision could discourage a third party from making a tender offer for our shares or attempting to obtain control of us. It could also delay shareholders who do not agree with the policies of the board of directors from removing a majority of the board of directors for two years.

No Cumulative Voting

Calling of Special Meetings of Shareholders

Our bylaws provide that special meetings of our shareholders may be called only by the chairman of our board of directors, by resolution of our board of directors or by holders of 30% or more of the voting power of the aggregate number of our shares issued and outstanding and entitled to vote at such meeting.

Advance Notice Requirements for Shareholder Proposals and Director Nominations

Our bylaws provide that, with a few exceptions, shareholders seeking to nominate candidates for election as directors or to bring business before an annual meeting of shareholders must provide timely notice of their proposal in writing to the corporate secretary.

Generally, to be timely, a shareholder’s notice must be received at our principal executive offices not less than 150 days nor more than 180 days prior to the first anniversary date of the immediately preceding annual meeting of shareholders. Our bylaws also specify requirements as to the form and content of a shareholder’s notice. These provisions may impede shareholders’ ability to bring matters before an annual meeting of shareholders or make nominations for directors at an annual meeting of shareholders.

Business Combinations

Although the BCA does not contain specific provisions regarding “business combinations” between companies organized under or redomiciled pursuant to the laws of the Marshall Islands and “interested shareholders,” these provisions are contained in our articles of incorporation. Specifically, our articles of incorporation contain provisions that prohibit us from engaging in a business combination with an interested shareholder for a period of three years following the date of the transaction in which the person became an interested shareholder, unless, in addition to any other approval that may be required by applicable law:

prior to the date of the transaction that resulted in the shareholder becoming an interested shareholder, our board of directors approved either the business combination or the transaction that resulted in the shareholder becoming an interested shareholder;

upon consummation of the transaction that resulted in the shareholder becoming an interested shareholder, the interested shareholder owned at least 85.0% of our voting shares outstanding at the time the transaction commenced, excluding for purposes of determining the number of shares outstanding those shares owned by (1) persons who are directors and officers and (2) employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or

at or after the date of the transaction that resulted in the shareholder becoming an interested shareholder, the business combination is approved by our board of directors and authorized at an annual or special meeting of shareholders, and not by written consent, by the affirmative vote of at least 66-2/3% of the voting power of the voting shares that are not owned by the interested shareholder.

Among other transactions, a “business combination” includes any merger or consolidation of us or any directly or indirectly majority-owned subsidiary of ours with (1) the interested shareholder or any of its affiliates or (2) with any corporation, partnership, unincorporated association or other entity if the merger or consolidation is caused by the interested shareholder. Generally, an “interested shareholder” is any person or entity (other than us and any direct or indirect majority-owned subsidiary of ours) that:

owns 15.0% or more of our outstanding voting shares;

is an affiliate or associate of ours and was the owner of 15.0% or more of our outstanding voting shares at any time within the three-year period immediately prior to the date on which it is sought to be determined whether such person is an interested shareholder; or

is an affiliate or associate of any person listed in the first two bullets, except that any person who owns 15.0% or more of our outstanding voting shares, as a result of action taken solely by us will not be an interested shareholder unless such person acquires additional voting shares, except as a result of further action by us and not caused, directly or indirectly, by such person.

Additionally, the restrictions regarding business combinations do not apply to persons that became interested shareholders prior to the effectiveness of our articles of incorporation.

Limitations on Liability and Indemnification of Directors and Officers

The BCA authorizes corporations to limit or eliminate the personal liability of directors ~~and officers~~ to corporations and their shareholders for monetary damages for breaches of certain directors’ fiduciary duties. Our articles of incorporation include a provision that eliminates the personal liability of directors for monetary damages for breach of fiduciary duty as a director to the fullest extent permitted by law and provides that we must indemnify our directors and officers to the fullest extent authorized by law. We are also expressly authorized to advance certain expenses to our directors and officers and expect to carry directors’ and officers’ insurance providing indemnification for our directors and officers for some liabilities. We believe that these indemnification provisions and the directors’ and officers’ insurance are useful to attract and retain qualified directors and executive officers.

The limitation of liability and indemnification provisions in our articles of incorporation may discourage shareholders from bringing a lawsuit against our directors for breach of their fiduciary duty. These provisions may also have the effect of reducing the likelihood of derivative litigation against directors and officers, even though such an action, if successful, may otherwise benefit us and our shareholders. In addition, an investor in our common shares may be adversely affected to the extent we pay the costs of settlement and damage awards against directors and officers pursuant to these indemnification provisions.

There is no pending material litigation or proceeding involving any of our directors, officers or employees for which indemnification is sought.

C. Material Contracts

We refer you to “Item 7.B. Related Party Transactions” for a discussion of our agreements with companies related to us. We also refer you to “Item 4. Information on the ~~Company”~~Company,” “Item 5.B. Liquidity and Capital Resources—Indebtedness” and “Item 6.E. Share Ownership—Long Term Incentive Plan” for a description of other material contracts.

Other than these agreements, we have no material contracts, other than contracts entered into in the ordinary course of business, to which the Company or any member of the group is a party.

D. Exchange Controls

Under Marshall Islands law, there are currently no restrictions on the export or import of capital, including foreign exchange controls or restrictions that affect the remittance of dividends, interest or other payments to non-resident holders of our common shares.

E. Taxation

Marshall Islands Tax Considerations

The following is applicable only to persons who do not reside in, maintain offices in or engage in business in the Marshall Islands.

Because we do not, and we do not expect that we or any of our future subsidiaries will, conduct business or operations in the Marshall Islands, and because we anticipate that all documentation related to any offerings of our securities will be executed outside of the Marshall Islands, under current Marshall Islands law our shareholders will not be subject to Marshall Islands taxation or withholding tax on our distributions. In addition, our shareholders will not be subject to Marshall Islands stamp, capital gains or other taxes on the purchase, ownership or disposition of our common shares, and our shareholders will not be required by the Marshall Islands to file a tax return related to our common shares.

Malta Tax Considerations

One of our subsidiaries is incorporated in Malta, which imposes taxes on us that are immaterial to our operations.

Greek Tax Considerations

United States Tax Considerations

This discussion of United States federal income taxes is based upon provisions of the Code, existing final, temporary and proposed regulations thereunder and current administrative rulings and court decisions, all as in effect on the effective date of this annual report on Form 20-F and all of which are subject to change, possibly with retroactive effect. Changes in these authorities may cause the tax consequences to vary substantially from the consequences described below. No rulings have been or are expected to be sought from the ~~Internal Revenue Service, or~~ IRS with respect to any of the United States federal income tax consequences discussed below, and no assurance can be given that the IRS will not take contrary positions.

Further, the following summary does not deal with all United States federal income tax consequences applicable to any given holder of our common shares, nor does it address the United States federal income tax considerations applicable to categories of investors subject to special taxing rules, such as expatriates, banks, real estate investment trusts, regulated investment companies, insurance companies, tax-exempt organizations, dealers or traders in securities or currencies, partnerships, S corporations, estates and trusts, investors that hold their common shares as part of a hedge, straddle or an integrated or conversion transaction, investors whose “functional currency” is not the United States dollar or investors that own, directly or indirectly 10% or more of our stock by vote or value. Furthermore, the discussion does not address alternative minimum tax consequences or estate or gift tax consequences, or any state tax consequences, and is ~~generally~~ limited to people that will hold their common shares as “capital assets” within the meaning of Section 1221 of the Code. Each shareholder is encouraged to consult, and discuss with his or her own tax advisor the United States federal, state, local and non-United States tax consequences particular to him or her of the acquisition, ownership or disposition of common shares. Further, it is the responsibility of each shareholder to file all state, local and non-U.S., as well as U.S. federal, tax returns that may be required of it.

Pursuant to U.S. Department of the Treasury regulations, the Company and its tax advisors hereby inform you that: (1) any tax advice contained in this annual report on Form 20-F is not intended and was not written to be used, and cannot be used by any taxpayer, for the purposes of avoiding penalties that may be imposed on the taxpayer; and (2) each taxpayer should seek advice based on the taxpayer’s particular circumstances from an independent tax advisor.

United States Federal Income Taxation of the Company

Taxation of Operating Income

Unless exempt from United States federal income taxation under the rules described below in “—The Section 883 Exemption,” a foreign corporation that earns only transportation income is generally subject to United States federal income taxation under one of two alternative tax regimes: (1) the 4% gross basis tax or (2) the net basis tax and branch profits tax. Since its redomiciliation, the Company is a Marshall Islands corporation and its subsidiaries are incorporated in the Marshall ~~Islands.~~Islands or Malta. There is no comprehensive income tax treaty between the Marshall Islands and the United States, so the Company and ~~such~~its Marshall Islands subsidiaries cannot claim an exemption from this tax under a treaty.

The 4% Gross Basis Tax

The United States imposes a 4% United States federal income tax (without allowance of any deductions) on a foreign corporation’s United States source gross transportation income to the extent such income is not treated as effectively connected with the conduct of a United States trade or business. For this purpose, transportation income includes income from the use, hiring or leasing of a vessel, or the performance of services directly related to the use of a vessel (and thus includes time charter, spot charter and bareboat charter income). The United States source portion of transportation income is 50% of the income attributable to voyages that begin or end, but not both begin and end, in the United States. As a result of this sourcing rule the effective tax rate is 2% of the gross income attributable to U.S. voyages. Generally, no amount of the income from voyages that begin and end outside the United States is treated as United States source, and consequently none of the transportation income attributable to such voyages is subject to this 4% tax. (Although the entire amount of transportation income from voyages that begin and end in the United States would be United States source, neither the Company nor any of its subsidiaries expects to have any transportation income from voyages that both begin and end in the United States.)

The Net Basis Tax and Branch Profits Tax

The Company and each of its subsidiaries do not expect to engage in any activities in the United States (other than port calls of its vessels) or otherwise have a fixed place of business in the United States. Consequently, the Company and its subsidiaries are not expected to be subject to the net basis or branch profits taxes. Nonetheless, if this situation were to change or if the Company or a subsidiary of the Company were to be treated as engaged in a United States trade or business, all or a portion of the Company’s or such subsidiary’s taxable income, including gain from the sale of vessels, could be treated as effectively connected with the conduct of this United States trade or business, or effectively connected income. Any effectively connected income, net of allowable deductions, would be subject to United States federal corporate income tax (with the highest statutory rate currently being 35%). In addition, an additional 30% branch profits tax would be imposed on the Company or such subsidiary at such time as the Company’s or such subsidiary’s after-tax effectively connected income is deemed to have been repatriated to the Company’s or subsidiary’s offshore office.

The 4% gross basis tax described above is inapplicable to income that is treated as effectively connected income. A non-United States corporation’s United States source transportation income would be considered to be effectively connected income only if the non-United States corporation has or is treated as having a fixed place of business in the United States involved in the earning of the transportation income and substantially all of its United States source transportation income is attributable to regularly scheduled transportation (such as a published schedule with repeated sailings at regular intervals between the same points for voyages that begin or end in the United States). The Company and its vessel-owning subsidiaries believe that their vessels will not operate to and from the United States on a regularly scheduled basis. Based on the intended mode of shipping operations and other activities, the Company and its vessel-owning subsidiaries do not expect to have any effectively connected income.

The Section 883 Exemption

Both the 4% gross basis tax and the net basis and branch profits taxes described above are inapplicable to transportation income that qualifies for the Section 883 Exemption. To qualify for the Section 883 Exemption a foreign corporation must, among other things:

be organized in a jurisdiction outside the United States that grants an equivalent exemption from tax to corporations organized in the United States (an “Equivalent Exemption”);

satisfy one of the following three ownership tests (discussed in more detail below): (1) the more than 50% ownership test, or 50% Ownership Test, (2) the controlled foreign corporation test, or CFC Test, or (3) the “Publicly Traded Test”; and

meet certain substantiation, reporting and other requirements (which include the filing of United States income tax returns).

The Company is a Marshall Islands corporation, and each of the vessels in its fleet is owned by a separate wholly owned subsidiary organized in the Marshall ~~Islands.~~Islands or Malta. The U.S. Department of the Treasury recognizes the Marshall Islands and Malta as ~~a jurisdiction that grants~~jurisdictions which grant an Equivalent Exemption; therefore, the Company and each of its vessel-owning subsidiaries meets the first requirement for the Section 883 Exemption for periods after November 24, 2010. Prior to November 24, 2010, the Company was a Jersey corporation, but the all of the ships were owned by subsidiaries who are Marshall Islands corporations treated for United States tax purposes as separate taxpayers. So each subsidiary meets the first requirement for the Section 883 Exemption for all of 2010. Each of the vessels in the Company’s fleet was owned by one of the Company’s Marshall Islands subsidiaries.

Exemption.

The 50%Ownership Test

In order to satisfy the 50% Ownership Test, a non-United States corporation must be able to substantiate that more than 50% of the value of its shares is owned, directly or indirectly, by “qualified shareholders.” For this purpose, qualified shareholders are: (1) individuals who are residents (as defined in the Treasury regulations promulgated under Section 883 of the Code, or Section 883 Regulations) of countries, other than the United States, that grant an Equivalent Exemption, (2) non-United States corporations that meet the Publicly Traded Test of the Section 883 Regulations and are organized in countries that grant an Equivalent Exemption, or (3) certain foreign governments, non-profit organizations, and certain beneficiaries of foreign pension funds. In order for a shareholder to be a qualified shareholder, there generally cannot be any bearer shares in the chain of ownership between the shareholder and the taxpayer claiming the exemption (unless such bearer shares are maintained in a dematerialized or immobilized book-entry system as permitted under the Section 883 Regulations). A corporation claiming the Section 883 ~~exemption~~Exemption based on the 50% Ownership Test must obtain all the facts necessary to satisfy the IRS that the 50% Ownership Test has been satisfied (as detailed in the Section 883 Regulations). For the taxable year ended December 31, ~~2010,~~2013, the Company believes that each of its vessel-owning subsidiaries satisfied the 50% Ownership Test based on the beneficial ownership of more than 50% of the value of its shares by a qualifying shareholder, assuming that such shareholder meets all of the substantiation and reporting requirements under Section 883 of the Code and the Section 883 Regulations for such taxable year, and that each such subsidiary should therefore qualify for the Section 883 Exemption for such taxable year.

The CFC Test

The CFC Test requires that a non-United States corporation be treated as a controlled foreign corporation, or a CFC, for United States federal income tax purposes for more than half of the days in the taxable year. A CFC is a foreign corporation, more than 50% of the vote or value of which is owned by significant U.S. shareholders (meaning U.S. persons who own at least 10% of the voting power of the foreign corporation). In addition, more than 50% of the value of the shares of the CFC must be owned by qualifying U.S. persons for more than half of the days during the taxable year concurrent with the period of time that the company qualifies as a CFC. For this purpose, a qualifying U.S. person is defined as a U.S. citizen or resident alien, a domestic corporation or domestic trust, in each case, if such U.S. person provides the company claiming the exemption with an ownership statement. ~~Please read “—United States Federal Income Taxation of the Company—The Publicly Traded Test.”~~ The Company does not believe that the requirements of the CFC Test will be met in the near future with respect to the Company or any of its subsidiaries.

The Publicly Traded Test

The Publicly Traded Test requires that one or more classes of equity representing more than 50% of the voting power and value in a non-United States corporation be “primarily and regularly traded” on an established securities market either in the United States or in a foreign country that grants an Equivalent Exemption. The Section 883 Regulations provide, in relevant part, that the shares of a non-United States corporation will be considered to be “primarily traded” on an established securities market in a country if the number of shares of each class of shares that are traded during any taxable year on all established securities markets in that country exceeds the number of shares in each such class that are traded during that year on established securities markets in any other single country. The Section 883 Regulations also generally provide that shares will be considered to be “regularly traded” on an established securities market if one or more classes of shares in the corporation representing in the aggregate more than 50% of the total combined voting power and value of all classes of shares of the corporation are listed on an established securities market. Also, with respect to each class relied upon to meet this requirement (1) such class of shares must be traded on the market, other than in minimal quantities, on at least 60 days during the taxable year or one-sixth of the days in a short taxable year, and (2) the aggregate number of shares of such class of shares traded on such market during the taxable year is at least 10% of the average number of shares of such class of shares outstanding during such year or as adjusted for a short taxable year. These two tests are deemed to be satisfied if such class of shares is traded on an established market in the United States and such shares are regularly quoted by dealers making a market in such shares.

Notwithstanding the foregoing, the Section 883 Regulations provide, in relevant part, that a class of shares will not be considered to be “regularly traded” on an established securities market for any taxable year in which 50% or more of the vote and value of the outstanding shares of such class are owned, actually or constructively under specified share attribution rules, on more than half the days during the taxable year by persons who each own 5% or more of the vote and value of such class of outstanding shares, to which we refer as the 5 Percent Override Rule.

For purposes of being able to determine the person who actually or constructively own 5% or more of the vote and value of the Company’s common shares, or 5% Shareholders, the Section 883 Regulations permit the Company to rely on those persons that are identified on Schedule 13G and Schedule 13D filings with the SEC, as owning 5% or more of the Company’s common shares.

In the event the 5 Percent Override Rule is triggered, the Section 883 Regulations provide that such rule will not apply if the Company can establish that within the group of 5% Shareholders, there are sufficient qualified shareholders within the meaning of Section 883 and the Section 883 Regulations to preclude non-qualified shareholders in such group from owning 50% or more of the total value of the Company’s common shares for more than half the number of days during the taxable year.

The Company and its vessel-owning subsidiaries should satisfy the 50% Ownership Test. The stock in the Company’s vessel-owning subsidiaries is not publicly traded, but if the Company meets the Publicly Traded Test described above, the Company also may be a qualifying shareholder for purposes of applying the 50% Ownership Test as to any subsidiary claiming the Section 883 Exemption. However, if for any period after the Company issues the Class B shares, the common shares represent less than 50% of the voting power of the Company, the Company would not be able to satisfy the Publicly Traded Test for such period because less than 50% of the stock of the Company, measured by voting power, would be listed on an established securities market.

A foreign corporation can only claim the Section 883 Exemption if it receives the ownership statements required under the Section 883 Regulations certifying as to the matters required to satisfy the relevant ownership ~~test, each an ownership statement.~~test. Each of our vessel-owning subsidiaries has received, or expects to receive, ownership statements, relating to the year ended December 31, ~~2010,~~2013, certifying the qualifying shareholder status of a shareholder beneficially owning more than 50% of the value of each such subsidiary’s stock and the status of intermediaries as required to support a claim by each vessel-owning subsidiary of the Section 883 Exemption.

Each of the Company’s vessel-owning subsidiaries has claimed the Section 883 Exemption on the basis that it satisfies the 50% Ownership Test and the Company intends to continue to comply with the substantiation, reporting and other requirements that are applicable under Section 883 of the Code to enable such subsidiaries to claim the exemption on this basis.

In the future, if the shareholders or the relative ownership in the Company changes, if the Company believes that it (or its subsidiaries) can qualify for the Section 883 Exemption, each shareholder who is or may be a qualifying person will be asked to provide to the Company an ownership statement for purposes of substantiating the relevant company’s entitlement for the exemption. An ownership statement is required to be signed by the shareholder under penalties of perjury and contains information regarding the residence of the shareholder and its ownership in the company claiming the Section 883 Exemption. If the Company or a subsidiary needs to obtain additional ownership statements in order to establish a Section 883 Exemption, there is no guarantee that shareholders representing a sufficient ownership interest in the Company or any of its subsidiaries will provide ownership statements to the relevant company so that it will satisfy any of the Section 883 ownership tests and the Section 883 Exemption would not apply to the Company. If in future years the shareholders fail to update or correct such statements, the Company and its subsidiaries may not continue to qualify for the Section 883 Exemption.

A corporation’s qualification for the Section 883 Exemption is determined for each taxable year. If the Company and/or its subsidiaries were not to qualify for the Section 883 Exemption in any year, the United States income taxes that become payable would have a negative effect on the business of the Company and its subsidiaries, and would result in decreased earnings available for distribution to the Company’s shareholders.

United States Taxation of Gain on Sale of Vessels

If the Company’s subsidiaries qualify for the Section 883 Exemption, then gain from the sale of any vessel would be exempt from tax under Section 883. If, however, the gain is not exempt from tax under Section 883, the Company will not be subject to United States federal income taxation with respect to such gain provided that the income from the vessel has never constituted effectively connected income and that the sale is considered to occur outside of the United States under United States federal income tax principles. In general, a sale of a vessel will be considered to occur outside of the United States for this purpose if title to the vessel, and risk of loss with respect to the vessel, pass to the buyer outside of the United States. To the extent possible, the Company will attempt to structure any sale of a vessel so that it is considered to occur outside of the United States.

United States Federal Income Taxation of United States Holders

As used herein, “United States Holder” means a beneficial owner of the Company’s common shares that is an individual citizen or resident of the United States for United States federal income tax purposes, a corporation or other entity taxable as a corporation created or organized in or under the laws of the United States or any state thereof (including the District of Columbia), an estate the income of which is subject to United States federal income taxation regardless of its source or a trust where a court within the United States is able to exercise primary supervision over the administration of the trust and one or more United States persons (as defined in the Code) have the authority to control all substantial decisions of the trust (or a trust that has made a valid election under U.S. Department of the Treasury regulations to be treated as a domestic trust). A “Non-United States Holder” generally means any owner (or beneficial owner) of common shares that is not a United States Holder, other than a partnership. If a partnership holds common shares, the tax treatment of a partner will generally depend upon the status of the partner and upon the activities of the partnership. Partners of partnerships holding common shares should consult their own tax advisors regarding the tax consequences of an investment in the common shares (including their status as United States Holders or Non-United States Holders).

Distributions

Subject to the discussion of PFICs below, any distributions made by the Company with respect to the common shares to a United States Holder will generally constitute dividends, which may be taxable as ordinary income or qualified dividend income as described in more detail below, to the extent of the Company’s current or accumulated earnings and profits as determined under United States federal income tax principles. Distributions in excess of the Company’s earnings and profits will be treated as a nontaxable return of capital to the extent of the United States Holder’s tax basis in its common shares and, thereafter, as capital gain. United States Holders that are corporations generally will not be entitled to claim a dividends received deduction with respect to any distributions they receive from us.

Dividends paid on the shares of a non-U.S. corporation to an individual generally will not be treated as qualified dividend income that is taxable at a maximum tax rate of 15% through 2012 The preferential rate of federal tax on qualified dividends will expire unless Congress enacts legislation to extend it beyond December 31, 2012. However, , dividends paid in respect of the Company’s common shares ~~paid prior to that date~~ may qualify asfor the preferential rate attributable to qualified dividend income if: (1) the common shares are readily tradable on an established securities market in the United States; (2) the Company is not a PFIC for the taxable year during which the dividend is paid or in the immediately preceding taxable year; (3) the United States Holder has owned the common shares for more than 60 days in the 121-day period beginning 60 days before the date on which the common shares become ex-dividend and (4) the United States Holder is not under an obligation to make related payments with respect to positions in substantially similar or related property. The first requirement is met as our common shares are listed on the Nasdaq Global Market. The second requirement is expected to be met as more fully described below under “—Consequences of Possible PFIC Classification.” Satisfaction of the final two requirements will depend on the particular circumstances of each United States Holder. Consequently, if any of these requirements are not met, the dividends paid to individual United States Holders in respect of the Company’s common shares would not to be treated as qualified dividend income and would be taxed as ordinary income at ordinary rates.

After December 31, 2012, dividend income will be taxed at ordinary interest rates and, therefore, the rate on such dividend income will increase, unless Congress enacts legislation to extend the preferential rates.

However, legislation has been proposed in the past and may again be proposed in the future that would have the effect of classifying dividends paid by the Company as other than qualified dividends, with the result that no United States Holder would be eligible for the preferential tax rates applicable to qualified dividend income even if the preferential rate is extended.

Amounts taxable as dividends generally will be treated as income from sources outside the United States and will, depending on your circumstances, be “passive” or “general” income which, in either case, is treated separately from other types of income for purposes of computing the foreign tax credit allowable to you. However, if (1) the Company is 50% or more owned, by vote or value, by United States persons and (2) at least 10% of the Company’s earnings and profits are attributable to sources within the United States, then for foreign tax credit purposes, a portion of our dividends would be treated as derived from sources within the United States. Under such circumstances, with respect to any dividend paid for any taxable year, the United States source ratio of the Company’s dividends for foreign tax credit purposes would be equal to the portion of the Company’s earnings and profits from sources within the United States for such taxable year, divided by the total amount of the Company’s earnings and profits for such taxable year.

Consequences of Possible PFIC Classification

A non-United States entity treated as a corporation for United States federal income tax purposes will be a PFIC in any taxable year in which, after taking into account the income and assets of the corporation and certain subsidiaries pursuant to a “look through” rule, either: (1) 75% or more of its gross income is “passive” income or (2) 50% or more of the average value of its assets is attributable to assets that produce passive income or are held for the production of passive income. If a corporation is a PFIC in any taxable year that a person holds shares in the corporation (and was not a qualified electing fund with respect to such year, as discussed below), the shares held by such person will be treated as shares in a PFIC for all future years (absent an election which, if made, may require the electing person to pay taxes in the year of the election). A United States Holder of shares in a PFIC would be required to file an annual information return on IRS Form 8621 containing information regarding the PFIC as required by U.S. Department of the Treasury regulations.

While there are legal uncertainties involved in this determination, including as a result of adverse ~~recent~~ case law described herein, based upon the Company’s and its subsidiaries’ expected operations as described herein and based upon the current and expected future activities and operations of the Company and its subsidiaries, the income of the Company and such subsidiaries from time charters should not constitute “passive income” for purposes of applying the PFIC rules, and the assets that the Company owns for the production of this time charter income should not constitute passive assets for purposes of applying the PFIC rules.

Although there is no legal authority directly on point, this view is based principally on the position that the gross income that the Company and its subsidiaries derive from time charters constitutes services income rather than passive rental income. ~~Recently, the~~The Fifth Circuit Court of Appeals decided inTidewater Inc. v. United States, 565 F.3d 299 (5th Cir., ~~April 13,~~ 2009), that a typical time charter is a lease, and not a contract for the provision of transportation services. In that case, the court was considering a tax issue that turned on whether the taxpayer was a lessor where a vessel was under a time charter, and the court did not address the definition of passive income or the PFIC rules; however, the reasoning of the case could have implications as to how the income from a time charter would be classified under such rules. If the reasoning of theTidewater case is applied to the Company’s situation and the Company’s or its subsidiaries’ time charters are treated as leases, the Company’s or its subsidiaries’ time charter income could be classified as rental income and the Company would be a PFIC unless more than 25% of the income of the Company (taking into account the subsidiary look through rule) is from spot charters plus other active income or an active leasing exception applies. The IRS has announced that it will not follow the reasoning of the Tidewater case and would have treated the income from the time charters at issue in that case as services income, including for other purposes of the Code. The Company intends to take the position that all of its time, voyage and spot chartering activities will generate active services income and not passive leasing income, but in the absence of direct legal authority specifically relating to the Code provisions governing PFICs, the IRS or a court could disagree with this position. Although the matter is not free from doubt as described herein, based on the current operations and activities of the Company and its subsidiaries and on the relative values of the vessels in the Company’s fleet and the charter income in respect of the vessels, Globus Maritime Limited should not be treated as a PFIC during the taxable year ended December 31, ~~2010.~~

2013.

Based on the Company’s intention and expectation that the Company’s subsidiaries’ income from spot, time and voyage chartering activities plus other active operating income will be greater than 25% of the Company’s total gross income at all relevant times and that the gross value of the vessels subject to such time, voyage or spot charters will exceed the gross value of all ~~other~~the passive assets the Company owns at all relevant times, Globus Maritime Limited does not expect that it will constitute a PFIC with respect to a taxable year in the near future.

The Company will try to manage its vessels and its business so as to avoid being classified as a PFIC for a future taxable year; however there can be no assurance that the nature of the Company’s assets, income and operations will remain the same in the future (notwithstanding the Company’s current expectations). Additionally, no assurance can be given that the IRS or a court of law will accept the Company’s position that the time charters that the Company’s subsidiaries have entered into or any other time charter that the Company or a subsidiary may enter into will give rise to active income rather than passive income for purposes of the PFIC rules, or that future changes of law will not adversely affect this position. The Company has not obtained a ruling from the IRS on its time charters or its PFIC status and does not intend to seek one. Any contest with the IRS may materially and adversely impact the market for the common shares and the prices at which they trade. In addition, the costs of any contest on the issue with the IRS will result in a reduction in cash available for distribution and thus will be borne indirectly by the Company’s shareholders.

If Globus Maritime Limited were to be classified as a PFIC in any year, each United States Holder of the Company’s shares will be subject (in that year and all subsequent years) to special rules with respect to: (1) any “excess distribution” (generally defined as any distribution received by a shareholder in a taxable year that is greater than 125% of the average annual distributions received by the shareholder in the three preceding taxable years or, if shorter, the shareholder’s holding period for the shares), and (2) any gain realized upon the sale or other disposition of the common shares. Under these rules:

the excess distribution or gain will be allocated ratably over the United States Holder’s holding period;

the amount allocated to the current taxable year and any year prior to the first year in which the Company was a PFIC will be taxed as ordinary income in the current year; and

the amount allocated to each of the other taxable years in the United States Holder’s holding period will be subject to United States federal income tax at the highest rate in effect for the applicable class of taxpayer for that year, and an interest charge will be added as though the amount of the taxes computed with respect to these other taxable years were overdue.

In order to avoid the application of the PFIC rules, United States Holders may make a qualified electing fund, or a QEF, election provided in Section 1295 of the Code in respect of their common shares. Even if a United States Holder makes a QEF election for a taxable year of the Company, if the Company was a PFIC for a prior taxable year during which such holder held the common shares and for which such holder did not make a timely QEF election, the United States Holder would also be subject to the more adverse rules described above. Additionally, to the extent any of the Company’s subsidiaries is a PFIC, an election by a United States Holder to treat Globus Maritime Limited as a ~~“Qualifying Electing Fund”~~QEF would not be effective with respect to such holder’s deemed ownership of the stock of such subsidiary and a separate QEF election with respect to such subsidiary is required. In lieu of the PFIC rules discussed above, a United States Holder that makes a timely, valid QEF election will, in very general terms, be required to include its pro rata share of the Company’s ordinary income and net capital gains, unreduced by any prior year losses, in income for each taxable year (as ordinary income and long-term capital gain, respectively) and to pay tax thereon, even if no actual distributions are received for that year in respect of the common shares and even if the amount of that income is not the same as the amount of actual distributions paid on the common shares during the year. If the Company later distributes the income or gain on which the United States Holder has already paid taxes under the QEF rules, the amounts so distributed will not again be subject to tax in the hands of the United States Holder. A United States Holder’s tax basis in any common shares as to which a QEF election has been validly made will be increased by the amount included in such United States Holder’s income as a result of the QEF election and decreased by the amount of nontaxable distributions received by the United States Holder. On the disposition of a common share, a United States Holder making the QEF election generally will recognize capital gain or loss equal to the difference, if any, between the amount realized upon such disposition and its adjusted tax basis in the common share. In general, a QEF election should be made by filing a Form 8621 with the United States Holder’s federal income tax return on or before the due date for filing such United States Holder’s federal income tax return for the first taxable year for which the Company is a PFIC or, if later, the first taxable year for which the United States Holder held common shares. In this regard, a QEF election is effective only if certain required information is made available by the PFIC. Subsequent to the date that the Company first determines that it is a PFIC, the Company will use commercially reasonable efforts to provide any United States Holder of common shares, upon request, with the information necessary for such United States Holder to make the QEF election.

In addition to the QEF election, Section 1296 of the Code permits United States Holders to make a “mark-to-market” election with respect to marketable shares in a PFIC, generally meaning shares regularly traded on a qualified exchange or market and certain other shares considered marketable under U.S. Department of the Treasury regulations. As the Company’s common shares are listed on an established securities market, such common shares are marketable for purposes of this election. If a United States Holder makes a mark-to-market election in respect of its common shares, such United States Holder generally would, in each taxable year: (1) include as ordinary income the excess, if any, of the fair market value of the common shares at the end of the taxable year over such United States Holder’s adjusted tax basis in the common shares, and (2) be permitted an ordinary loss in respect of the excess, if any, of such United States Holder’s adjusted tax basis in the common shares over their fair market value at the end of the taxable year, but only to the extent of the net amount previously included in income as a result of the mark-to-market election (with the United States Holder’s basis in the common shares being increased and decreased, respectively, by the amount of such ordinary income or ordinary loss). The consequences of this election are generally less favorable than those of a QEF election for United States Holders that are sensitive to the distinction between ordinary income and capital gain, although this is not necessarily the case.

United States Holders are urged to consult their tax advisors as to the consequences of making a mark-to-market or QEF election, as well as other United States federal income tax consequences of holding shares in a PFIC.

As previously indicated, if the Company were to be classified as a PFIC for a taxable year in which the Company pays a dividend or the immediately preceding taxable year, dividends paid by the Company would not constitute “qualified dividend income” and, hence, would not be eligible for the reduced rate of United States federal income ~~tax that is available through 2010.~~

tax.

Consequences of Controlled Foreign Corporation Classification of the Company

If more than 50% of either the total combined voting power of the shares of the Company entitled to vote or the total value of all of the Company’s outstanding shares were owned, directly, indirectly or constructively by (i) citizens or residents of the United States, (ii) U.S. partnerships or corporations, or U.S. estates or trusts (as defined for U.S. federal income tax purposes), each of which owned, directly, indirectly or constructively 10% or more of the total combined voting power of the Company shares entitled to vote (each a “U.S. Shareholder”), the Company and its wholly owned subsidiaries generally would be treated as CFCs. U.S. Shareholders of a CFC are treated as receiving current distributions of their shares of Subpart F Income of the CFC even if they do not receive actual distributions. The Company or its subsidiaries may have income that would be treated as Subpart F Income, such as interest income, services income of Globus Shipmanagement or passive leasing income in respect of vessel charters. ~~(Please read “—United States Federal Income Taxation of United States Holders—Consequences of Possible PFIC Classification”).~~ Consequently, any United States Holders who are also U.S. Shareholders may be required to include in their U.S. federal taxable income their pro rata share of the Subpart F income of the Company and its subsidiaries, regardless of the amount of cash distributions received. The Company believes that its time charter income will not be treated as passive rental income, but there can be no assurance that the IRS will accept this position. Please read “—United States Federal Income Taxation of United States Holders—Consequences of Possible PFIC Classification.”

In the case where the Company and its subsidiaries are CFCs, to the extent that the Company’s distributions to a United States Holder who is also a U.S. Shareholder are attributable to prior inclusions of Subpart F income of such United States Holder, such distributions are not required to be reported as additional income of such United States Holder.

Whether or not the Company or a subsidiary will be a CFC will depend on the identity of the shareholders of the Company during each taxable year of the Company. As of the date of this annual report on Form 20-F, the Company should not be a CFC based on the current shareholders in the Company.

If the Company or one of its subsidiaries is a CFC, certain burdensome U.S. federal income tax and administrative requirements would apply to United States Holders that are U.S. Shareholders, but such United States Holders generally would not also be subject to all of the requirements generally applicable to owners of a PFIC. For example, a United States Holder that is a U.S. Shareholder will be required to annually file IRS Form 5471 to report certain aspects of its indirect ownership of a CFC. United States Holders should consult with their own tax advisors as to the consequences to them of being a U.S. Shareholder in a CFC.

Sale, Exchange or Other Disposition of Common Shares

A United States Holder generally will recognize taxable gain or loss upon a sale, exchange or other disposition of common shares in an amount equal to the difference between the amount realized by the United States Holder from such sale, exchange or other disposition and the United States Holder’s tax basis in such common shares. Assuming the Company does not constitute a PFIC for any taxable year, this gain or loss will generally be treated as long-term capital gain or loss if the United States Holder’s holding period is greater than one year at the time of the sale, exchange or other disposition. A United States Holder’s ability to deduct capital losses is subject to ~~severe~~ limitations.

If a United States Holder’s holding period for the common shares is more than one year, the gain or loss will be long-term capital gain or loss assuming that the Company does not constitute a PFIC for any taxable year.

United States Federal Income Taxation of Non-United States Holders

A Non-United States Holder will generally not be subject to United States federal income tax on dividends paid in respect of the common shares or on gains recognized in connection with the sale or other disposition of the common shares provided that the Non-United States Holder makes certain tax representations regarding the identity of the beneficial owner of the common shares, that such dividends or gains are not effectively connected with the Non-United States Holder’s conduct of a United States trade or business and that, with respect to gain recognized in connection with the sale or other disposition of the common shares by a non-resident alien individual, such individual is not present in the United States for 183 days or more in the taxable year of the sale or other disposition and other conditions are met. If the Non-United States Holder is engaged in a United States trade or business for United States federal income tax purposes, the income from the common shares, including dividends and gain from the sale, exchange or other disposition of the common stock, that is effectively connected with the conduct of that trade or business will generally be subject to regular United States federal income tax in the same manner as discussed above relating to the taxation of United States Holders.

Net Investment Income Tax

A United States Holder that is an individual or estate, or a trust that does not fall into a special class of trusts that is exempt from such tax, is subject to a 3.8% tax on the lesser of (1) such United States Holder’s “net investment income” (or undistributed “net investment income” in the case of estates and trusts) for the relevant taxable year and (2) the excess of such United States Holder’s modified adjusted gross income for the taxable year over a certain threshold (which in the case of individuals will be between $125,000 and $250,000, depending on the individual’s circumstances). A United States Holder’s net investment income will generally include its gross dividend income and its net gains from the disposition of the common shares, unless such dividends or net gains are derived in the ordinary course of the conduct of a trade or business (other than a trade or business that consists of certain passive or trading activities). Net investment income generally will not include a United States Holder’s pro rata share of the Company’s income and gain (if we are a PFIC and that United States Holder makes a QEF election, as described above in “—United States Federal Income Taxation of United States Holders—Consequences of Possible PFIC Classification”) or Subpart F Income (if we are a CFC with respect to which a United States Holder is a “U.S. Shareholder,” as described above in “—United States Federal Income Taxation of United States Holders—Consequences of Controlled Foreign Corporation Classification of the Company”). However, a United States Holder may elect to treat inclusions of income and gain from a QEF election or Subpart F Income as net investment income. Failure to make this election could result in a mismatch between a United States Holder’s ordinary income and net investment income. If you are a United States Holder that is an individual, estate or trust, you are urged to consult your tax advisor regarding the applicability of the net investment income tax to your income and gains in respect of your investment in the common shares.

Backup Withholding and Information Reporting

Information reporting to the IRS may be required with respect to payments on the common shares and with respect to proceeds from the sale of the common shares. With respect to Non-United States Holders, copies of such information returns may be made available to the tax authorities in the country in which the Non-United States Holder resides under the provisions of any applicable income tax treaty or exchange of information agreement. A “backup” withholding tax may also apply to those payments if:

a holder of the common shares fails to provide certain identifying information (such as the holder’s taxpayer identification number or an attestation to the status of the holder as a Non-United States Holder);

such holder is notified by the IRS that he or she has failed to report all interest or dividends required to be shown on his or her federal income tax returns; or

in certain circumstances, such holder has failed to comply with applicable certification requirements.

Backup withholding is not an additional tax and may be refunded (or credited against the holder’s United States federal income tax liability, if any), provided that certain required information is furnished to the IRS in a timely manner.

United States Holders of common shares may be required to file forms with the IRS under the applicable reporting provisions of the Code. For example, such United States Holders may be required, under Sections 6038, 6038B, 6038D and/or 6046 of the Code, and the regulations thereunder, to supply the IRS with certain information regarding the United States Holder, other United States Holders and the Company if (1) such person owns at least 10% of the total value or 10% of the total combined voting power of all classes of shares entitled to vote or (2) the acquisition, when aggregated with certain other acquisitions that may be treated as related under applicable regulations, exceeds $100,000. United States Holders may also be required to report information relating to an interest in common shares that are not held in a financial account maintained by a U.S. or foreign financial institution. In the event a United States Holder fails to file a form when required to do so, the United States Holder could be subject to substantial tax penalties.

Non-United States Holders may be required to establish their exemption from information reporting and backup withholding by certifying their status on IRS Form W-8BEN, W-8ECI or W-8IMY, as applicable.

We encourage each United States Holder and Non-United States Holder to consult with his, her or its own tax advisor as to the particular tax consequences to him, her or it of holding and disposing of the Company’s common shares, including the applicability of any federal, state, local or foreign tax laws and any proposed changes in applicable law.

F. Dividends and Paying Agents

Not Applicable.

G. Statement by Experts

Not Applicable.

H. Documents on Display

We file reports and other information with the SEC. These materials, including this annual report on Form 20-F and the accompanying exhibits, may be inspected and copied at the public reference facilities maintained by the SEC at 100 F Street, N.E., Washington, D.C. 20549, or from the SEC’s website http://www.sec.gov. You may obtain information on the operation of the public reference room by calling 1 (800) SEC-0330 and you may obtain copies at prescribed rates.

I. Subsidiary Information

Not Applicable.

Item 11. Quantitative and Qualitative Disclosures About Market Risk

Interest Rates

We are exposed to market risks associated with changes in interest rates relating to our loan arrangements with Credit Suisse, Commerzbank and ~~Deutsche Schiffsbank.~~DVB Bank. As of December 31, ~~2010,~~2013, we had a ~~$71.0~~$44.0 million outstanding balance under our ~~credit facility~~Credit Facility with Credit ~~Suisse. As of December 31, 2010, Kelty Marine has~~Suisse, a ~~$25.7~~$17.6 million principal balance outstanding under ~~its loan agreement~~the Kelty Loan Agreement with ~~Deutsche Schiffsbank.~~ Commerzbank and a $27.9 million principal balance outstanding under the DVB Loan Agreement with DVB Bank.

In December 2013, we entered into a revolving credit facility for up to $4.0 million with Firment Trading Limited, a company related through common control, for the purpose of financing our general working capital needs. We are not exposed to market risk with respect to this credit facility because interest is charged at a fixed rate of 5% per annum.

Interest costs incurred under our loan arrangements are included in our consolidated statement of comprehensive income.

In ~~2010,~~2013, the weighted average interest rate for our then-outstanding facilities in total was ~~1.46%~~2.54% and the respective interest rates on our loan agreements, other than the Firment Credit Facility, ranged from ~~1.0%~~1.16% to ~~3.29%~~2.81%, including margins.

We will continue to have debt outstanding, which could impact our results of operations and financial condition. Although we may in the future prefer to generate funds through equity offerings on terms acceptable to us rather than through the use of debt arrangements, we may not be able to do so. We expect to manage any exposure in interest rates through our regular operating and financing activities and, when deemed appropriate, through the use of derivative financial instruments.

During 2008 we had entered into two interest rate swap agreements ~~as of December 31, 2010 and 2009~~ in order to manage ~~future interest costs and~~ the risk associated with changing interest rates.

Both swap agreements reached maturity in November 2013.

The total notional principal amount of these swaps ~~as of each of December 31, 2010 and 2009~~ was $25 million, which ~~have~~had specified rates and durations.

~~Through these swap transactions, we effectively hedged the interest rate exposure of 26% of our loans outstanding as of December 31, 2010.~~

The following table sets forth the sensitivity of our existing loans as of December 31, ~~2010~~2013 as to a 1%1.0% (100 basis points) increase in LIBOR, ~~taking into account our interest rate swap agreements that are currently in place,~~ during the next five years, and reflects the additional interest ~~expense.~~

expense that will be incurred.

Year	Amount
~~2011~~	$	~~0.5 million~~
~~2012~~	$	~~0.4 million~~
~~2013~~	$	~~0.3 million~~
2014	$	~~0.6~~0.9 million
2015	$	~~0.5~~0.7 million
2016	$	0.4 million
2017	$	0.2 million
2018	$	0.1 million

Currency and Exchange Rates

We generate revenues from the trading of our vessels in U.S. dollars but historically incur certain amounts of our operating expenses in currencies other than the U.S. dollar. While we were incorporated in Jersey, the majority of our general and administrative expenses (including stock exchange fees and advisor fees) were payable in U.K. pounds sterling. For cash management, or treasury, purposes, we convert U.S. dollars into foreign currencies which we then hold on deposit until the date of each transaction. Fluctuations in foreign exchange rates create foreign exchange gains or losses when we mark-to-market these non-U.S. dollar deposits.

For accounting purposes, expenses incurred in Euro and other foreign currencies are converted into U.S. dollars at the exchange rate prevailing on the date of each transaction. Because a portion of our expenses are incurred in currencies other than the U.S. ~~Dollar,~~dollar, our expenses may from time to time increase relative to our revenues as a result of fluctuations in exchange rates, which could affect the amount of net income that we report in future periods. While we historically have not mitigated the risk associated with exchange rate fluctuations through the use of financial derivatives, we may determine to employ such instruments from time to time in the future in order to minimize this risk. Our use of financial derivatives would involve certain risks, including the risk that losses on a hedged position could exceed the nominal amount invested in the instrument and the risk that the counterparty to the derivative transaction may be unable or unwilling to satisfy its contractual obligations, which could have an adverse effect on our results.

Commodity Risk Exposure

The price and supply of fuel is unpredictable and fluctuates as a result of events outside our control, including geo-political developments, supply and demand for oil and gas, actions by members of the Organization of Petroleum Exporting Countries and other oil and gas producers, war and unrest in oil producing countries and regions, regional production patterns and environmental concerns and regulations. Because we do not intend to hedge our fuel costs, an increase in the price of fuel beyond our expectations may adversely affect our profitability, cash flows and ability to pay dividends.

Inflation

We do not expect inflation to be a significant risk to us in the current and foreseeable economic environment. In the event that inflation becomes a significant factor in the global economy, inflationary pressures would result in increased operating, voyage and finance costs.

Item 12. Description of Securities Other than Equity Securities

Not Applicable.

PART II

Item 13. Defaults, Dividend Arrearages and Delinquencies

None.

Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds

~~None.~~

In April 2012, we filed a Certificate of Designation, Preferences and Rights of Series A Preferred Stock with the Marshall Islands, setting forth the preferences and rights of our Series A Preferred Shares, which are described in “Item 10.B. Memorandum and Articles of Association—Preferred Shares.” In April 2012, we issued to our two executive officers, an aggregate of 3,347 Series A Preferred Shares. In January 2013, we redeemed 780 of these Series A Preferred Shares. Holders of Series A Preferred Shares may receive dividends prior to the holders of our shares, and also have a liquidation preference.

Item 15. Controls and Procedures

(a) Disclosure Controls and Procedures

Management, including our chief executive officer and chief financial officer, has conducted an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of ~~1934)~~1934, as amended, which we refer to as the Exchange Act) as of the end of the period covered by this annual report on Form 20-F. Disclosure controls and procedures are defined under SEC rules as controls and other procedures that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within required time periods. Disclosure controls and procedures include controls and procedures designed to ensure that information is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosures.

There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives.

Based upon that evaluation, our chief executive officer and chief financial officer ~~have~~has concluded that our disclosure controls and procedures are effective as of the evaluation date.

(b) Management’s Annual Report on Internal Control over Financial Reporting

~~This annual report does not include a report of management’s assessment regarding~~

Management is responsible for establishing and maintaining adequate internal control over financial reporting, ~~or an attestation report~~as such term is defined in Rule 13a-15(f) of the ~~company’s registered public accounting firm due to~~Exchange Act. The Company’s internal control over financial reporting is a ~~transition period established by rules~~process designed under the supervision of the ~~Securities~~Company’s chief executive officer and ~~Exchange~~chief financial officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company’s financial statements for external reporting purposes in accordance with IFRS as issued by the IASB.

Management has conducted an assessment of the effectiveness of the Company’s internal control over financial reporting based on the framework established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission ~~for newly public companies.~~

of 1992. Based on this assessment, management has determined that the Company’s internal control over financial reporting as of December 31, 2013 is effective.

(c) Attestation Report of the Registered Public Accounting Firm

This annual report does not include aan attestation report of ~~management’s assessment~~the Company’s registered public accounting firm regarding internal control over financial ~~reporting or an~~reporting. Management’s report was not subject to attestation ~~report of~~by the ~~company’s~~Company’s registered public accounting firm ~~due~~pursuant to ~~a transition period established by~~the rules of the ~~Securities and Exchange Commission for newly public companies.~~

SEC that permit the Company to provide only management’s report in this annual report on Form 20-F.

(d) Changes in Internal Control over Financial Reporting

~~There was no change in~~

None.

Inherent Limitations on Effectiveness of Controls

Our management, including our chief executive officer and our chief financial officer, do not expect that our disclosure controls or our internal control over financial reporting will prevent or detect all error and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that ~~occurred during~~ the ~~period covered~~control system’s objectives will be met. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by ~~this annual report~~the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part on ~~Form 20-F~~certain assumptions about the likelihood of future events, and there can be no assurance that ~~has materially affected,~~any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls effectiveness to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or ~~is reasonably likely to materially affect, our internal control over financial reporting.~~

deterioration in the degree of compliance with policies or procedures.

Item 16A. Audit Committee Financial Expert

Our board of directors has determined that Amir Eilon is our audit committee financial expert and he is considered to be “independent” according to the SEC rules.

Item 16B. Code of Ethics

We have adopted a code of ethics that applies to our directors, officers and employees. Our code of ethics is posted on our website and is available upon written request by our shareholders at no cost to Globus Shipmanagement Corp., 128 Vouliagmenis Avenue, 3rd Floor, 166 74 Glyfada, Athens, Greece. We intend to satisfy any disclosure requirements regarding any amendment to, or waiver from, a provision of this Code of Ethics by posting such information on our website.

Item 16C. Principal Accountant Fees and Services

Our principal accountants, Ernst & Young (Hellas) Certified Auditors Accountants S.A., an independent registered public accounting firm, have billed us for audit, audit-related and non-audit services as follows:

2010 2009

Audit Fees $ 188,838 $78,368
Audit-Related Fees - -
Tax Fees 3,500 4,300
All Other Fees - -

Total $ 192,338 $82,668

	2013		2012

Audit Fees	$	136,000		130,000
Audit-Related Fees		-		-
Tax Fees		4,500		9,400
All Other Fees		-		-

Total	$	140,500		139,400

Audit fees for the years ended December 31, ~~2010~~2013 and ~~2009~~2012 were paid in ~~Euro.~~

Euros.

Audit fees represent compensation for professional services rendered for the audit of the consolidated financial statements and for the review of the quarterly financial information as well as services in connection with the registration statements and related consents and comfort letters and any other audit services required for SEC or other regulatory filings.

Tax fees relate to services for assisting the Company in submitting tax declarations for those subsidiaries whose vessels performed voyages to the United States within 2012 and 2011.

The Audit Committee is responsible for the appointment, replacement, compensation, evaluation and oversight of the work of the independent auditors. As part of this responsibility, the Audit Committee pre-approves the audit and non-audit services performed by the independent auditors in order to assure that they do not impair the auditor’s independence from the Company. The Audit Committee has adopted a policy which sets forth the procedures and the conditions pursuant to which services proposed to be performed by the independent auditors may be pre-approved.

Item 16D. Exemptions from the Listing Standards for Audit Committees

Our audit committee is comprised of two independent members of our board of directors. Otherwise, our Audit Committee conforms to each other requirement applicable to audit committees as required by the applicable corporate governance standards of Nasdaq.

Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers

None.

Item 16F. Change in Registrant’s Certifying Accountant

None.

Item 16G. Corporate Governance

While a number of the Nasdaq’s corporate governance standards do not apply to us as a foreign private issuer, we intend to comply with a number of those rules. The practices that we will follow in lieu of Nasdaq’s corporate governance rules are as follows:

in lieu of a nomination committee and remuneration committee comprised entirely of independent directors, our nomination and remuneration committees are and will be comprised of a majority of independent directors. Each of these committees will be comprised of a minimum of two individuals. There is nothing to prohibit shareholders identifying and recommending potential candidates to become board members;

in lieu of holding regularly scheduled meetings of the board of directors at which only independent directors are present, we will not be holding such regularly scheduled meetings;

in lieu of a board of directors that is comprised by a majority of independent directors, our board of directors is not comprised of a majority of independent directors; ~~and~~

in lieu of an audit committee comprised of three independent directors, our audit committee has two ~~members.~~members;

in lieu of having a remuneration committee with the authorities and responsibilities set forth in the Nasdaq rules, our remuneration committee is not required to have such authorities and responsibilities; and

in lieu of obtaining shareholder approval prior to the issuance of designated securities (including adoption of any equity incentive plan), we will comply with provisions of the BCA, which allows the board of directors to approve share issuances.

Item 16H. Mining Safety Disclosure

Not Applicable.

PART III

Item 17. Financial Statements

See Item 18.

Item 18. Financial Statements

The following financial statements beginning on page F-1 are filed as a part of this annual report on Form 20-F.

Item 19. Exhibits

1.1	Articles of Incorporation of Globus Maritime Limited (incorporated by reference to Exhibit 3.1 to Amendment No. 1 to Globus Maritime Limited’s Registration Statement on Form F-1 (Reg. No. 333-170755) filed on November 24, 2010)

1.2	Bylaws of Globus Maritime Limited (incorporated by reference to Exhibit 3.2 to Amendment No. 1 to Globus Maritime Limited’s Registration Statement on Form F-1 (Reg. No. 333-170755) filed on November 24, 2010)

1.3	Certificate of Designation for Series A Preferred Stock of Globus Maritime Limited (incorporated by reference to Exhibit 1.3 to Globus Maritime Limited’s Annual Report on Form 20-F (Reg. No. 001-34985) filed on April 27, 2012)

4.1	Credit Facility between Credit Suisse and Global Maritime Limited, as supplemented (incorporated by reference to Exhibit 10.1 to Globus Maritime Limited’s Registration Statement on Form F-1 (Reg. No. 333-170755) filed on November 22, 2010)

~~100~~


4.2	Loan Agreement between Deutsche Schiffsbank Aktiengesellschaft and Kelty Marine Ltd. (incorporated by reference to Exhibit 10.2 to Globus Maritime Limited’s Registration Statement on Form F-1 (Reg. No. 333-170755) filed on November 22, 2010)

4.3	Long Term Incentive Plan of Globus Maritime Limited (incorporated by reference to Exhibit 10.3 to Globus Maritime Limited’s Registration Statement on Form F-1 (Reg. No. 333-170755) filed on November 22, 2010)

~~4.4~~	Business Opportunities Agreement between Globus Maritime Limited and Georgios Feidakis (incorporated by reference to Exhibit 10.4 to Globus Maritime Limited’s Registration Statement on Form F-1 (Reg. No. 333-170755) filed on November 22, 2010)

~~4.5~~4.4	Registration Rights Agreement between Globus Maritime Limited, Firment Trading Limited and Kim Holdings S.A. (incorporated by reference to Exhibit 10.5 to Globus Maritime Limited’s Registration Statement on Form F-1 (Reg. No. 333-170755) filed on November 22, 2010)

4.6*4.5	~~Memorandum of~~Sixth Supplemental Agreement to Facility Agreement, dated May 5, 2011 (incorporated by reference to Exhibit 99.1 to Globus Maritime Limited’s Current Report on Form 6-K (Reg. No. 001-34985) filed on May 9, 2011)

8.1*4.6	~~Subsidiaries~~Memorandum of ~~Globus~~Agreement, dated May 2, 2011 and Addendum No. 1 to the Memorandum of Agreement, dated May 6, 2011 (previously filed as Exhibit 10.8 to the Registration Statement on Form F-1 (Reg. No. 333-174290) filed on May 17, 2011)

4.7	Loan Agreement among DVB Bank SE, Artful Shipping S.A. and Longevity Maritime Limited (previously filed as Exhibit 10.10 to Amendment No. 3 to the Registration Statement on Form F-1 (Reg. No. 333-174290) filed on June 22, 2011)

11.1*4.8	First Supplemental Agreement to Loan Agreement dated March 1, 2012 (incorporated by reference to Exhibit 4.10 to Globus Maritime Limited’s Annual Report on Form 20-F (Reg. No. 001-34985) filed on April 30, 2013)

4.9	Second Supplemental Agreement to Loan Agreement among DVB Bank SE, Artful Shipping S.A. and Longevity Maritime Limited, dated April 10, 2013 (incorporated by reference to Exhibit 4.11 to Globus Maritime Limited’s Annual Report on Form 20-F (Reg. No. 001-34985) filed on April 30, 2013)

4.10	Seventh Supplemental Agreement to Facility Agreement, dated March 26, 2013 (incorporated by reference to Exhibit 4.12 to Globus Maritime Limited’s Annual Report on Form 20-F (Reg. No. 001-34985) filed on April 30, 2013)

4.11*	Revolving Credit Facility between Globus Maritime Limited and Firment Trading Limited, dated as of December 16, 2013

8.1	Subsidiaries of Globus Maritime Limited (incorporated by reference to Exhibit 8.1 to Globus Maritime Limited’s Annual Report on Form 20-F (Reg. No. 001-34985) filed on April 30, 2013)

11.1	Code of Ethics & Conduct of Globus Maritime Limited (incorporated by reference to Exhibit 11.1 to Globus Maritime Limited’s Annual Report on Form 20-F (Reg. No. 001-34985) filed on March 28, 2011)

12.112.1/12.2	Certification pursuant to section 302 of the Sarbanes-Oxley Act of 2002 of the President, ~~and~~ Chief Executive Officer

12.2*	~~Certification pursuant to section 302 of the Sarbanes-Oxley Act of 2002 of the~~ and Chief Financial Officer

13.1*	~~Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of the Chief Executive Officer~~

13.1/13.2*	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of the President, Chief Executive Officer and Chief Financial Officer

* Filed herewith.

~~101~~

Filed herewith.

SIGNATURES

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.

	GLOBUS MARITIME LIMITED

	By:	~~/s/~~/s/ Georgios Karageorgiou
		Name: Georgios Karageorgiou
		Title: President, Chief Executive
		Officer and Chief ~~Executive~~Financial Officer

Date: April 29, 2014

GLOBUS MARITIME LIMITED

CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED DECEMBER 31, 2013

~~Date: March 28, 2011~~

INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS

	Page

Report of Independent Registered Public Accounting Firm		F-2

Consolidated Statement of Financial Position		F-3

Consolidated Statement of Comprehensive Income		F-4

Consolidated Statement of Changes in Equity		F-5

Consolidated Statement of Cash Flows		F-6

Notes to the Consolidated Financial Statements		F-7	to 35

~~F-1~~

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders of Globus Maritime Limited

We have audited the accompanying consolidated statements of financial position of Globus Maritime Limited (“Globus”) as of December 31, ~~2010~~2013 and ~~2009,~~2012, and the related consolidated statements of comprehensive income, changes in equity and cash flows for each of the three years in the period ended December 31, ~~2010.~~2013 These financial statements are the responsibility of Globus’ management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of Globus’ internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of ~~the~~ Globus’ internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Globus Maritime Limited at December 31, ~~2010~~2013 and ~~2009,~~2012, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, ~~2010,~~2013, in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board (IASB).

/s/ Ernst & Young

Ernst & Young (Hellas) Certified Auditors Accountants S.A.

Athens, Greece

April 29, 2014

F-2

~~March 28, 2011~~

~~F-2~~

GLOBUS MARITIME LIMITED

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

(Expressed in thousands of U.S. Dollars)

December 31,
Notes 2010 2009
ASSETS

NON-CURRENT ASSETS
Vessels, net 5 191,506 93,166
Office furniture and equipment 40 28
Other non-current assets 10 10
Total non-current assets 191,556 93,204
CURRENT ASSETS
Cash and bank balances and bank deposits 3 24,618 59,157
Trade receivables, net 281 336
Inventories 6 467 355
Prepayments and other assets 7 1,530 1,488
Total current assets 26,896 61,336
Non-current assets classified as held for sale 5 - 33,030

26,896 94,366

TOTAL ASSETS 218,452 187,570

EQUITY AND LIABILITIES

EQUITY ATTRIBUTABLE TO SHAREHOLDERS
Share capital 10 29 29
Share premium 10 88,817 88,516
Retained earnings 28,942 24,913
Total equity 117,788 113,458
NON-CURRENT LIABILITIES
Long-term borrowings, net of current portion 12 85,332 36,175
Provision for staff retirement indemnities 2.19 56 43
Total non-current liabilities 85,388 36,218
CURRENT LIABILITIES
Current portion of long-term borrowings 12 10,906 33,900
Trade accounts payable 8 1,346 1,158
Accrued liabilities and other payables 9 698 1,095
Derivative financial instruments 18 1,800 1,230
Deferred revenue 526 511
Total current liabilities 15,276 37,894

TOTAL LIABILITIES 100,664 74,112
TOTAL EQUITY AND LIABILITIES 218,452 187,570

~~F-3~~

~~GLOBUS MARITIME LIMITED~~

~~CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME~~

~~(Expressed in thousands of U.S. Dollars, except per share data)~~

For the year ended December 31,
Notes 2010 2009 2008
REVENUE:
Time charter revenue 28,860 52,812 98,597

EXPENSES & OTHER OPERATING INCOME:
Voyage expenses 14 (2,152 ) (3,742 ) (6,674 )
Vessel operating expenses 14 (5,887 ) (10,137 ) (12,537 )
Depreciation 5 (7,367 ) (11,204 ) (17,407 )
Depreciation of drydocking costs 5 (410 ) (1,512 ) (1,572 )
Administrative expenses 15 (2,310 ) (2,004 ) (2,122 )
Administrative expenses payable to related parties 4 (1,066 ) (1,272 ) (1,216 )
Share based payments 13 (311 ) (1,754 ) (770 )
Impairment loss 5 - (28,429 ) (20,224 )
Gain/(loss) on sale of vessels 19 7 (802 ) 15,095
Other expenses, net (35 ) (106 ) 408

Operating profit/(loss) before financing activities 9,329 (8,150 ) 51,578

Interest income from bank balances and bank deposits 247 1,032 946
Interest expense and finance costs 16 (2,133 ) (2,926 ) (7,707 )
(Loss)/gain on derivative financial instruments 18 (570 ) 143 (1,373 )
Foreign exchange losses, net (870 ) (178 ) (626 )
Total finance costs, net (3,326 ) (1,929 ) (8,760 )

TOTAL PROFIT/(LOSS) FOR THE YEAR 6,003 (10,079 ) 42,818
Other Comprehensive Income/(loss) - - -
TOTAL COMPREHENSIVE INCOME/(LOSS) FOR THE YEAR 6,003 (10,079 ) 42,818

Earnings/(loss) per share:
- Basic earnings/(loss) per share for the year 11 0.83 (1.40 ) 5.98
- Diluted earnings/(loss) per share for the year 11 0.82 (1.40 ) 5.93

			December 31,
	Notes		2013			2012
ASSETS

NON-CURRENT ASSETS
Vessels, net		5		133,577			140,860
Office furniture and equipment				120			96
Other non-current assets				10			10
Total non-current assets				133,707			140,966
CURRENT ASSETS
Cash and bank balances and bank deposits		3		5,889			11,653
Trade receivables, net		2.7		846			728
Inventories		6		633			658
Prepayments and other assets		7		3,221			2,841
Total current assets				10,589			15,880
Vessel classified as held for sale		2.29,5		11,366			8,876
				21,955			24,756
TOTAL ASSETS				155,662			165,722

EQUITY AND LIABILITIES

EQUITY ATTRIBUTABLE TO SHAREHOLDERS
Share capital		10		41			41
Share premium		10		109,803			109,753
Accumulated deficit				(49,504	)		(54,612	)
Total equity				60,340			55,182
NON-CURRENT LIABILITIES
Long-term borrowings, net of current portion		4,12		72,737			78,735
Provision for staff retirement indemnities		2.19		64			77
Total non-current liabilities				72,801			78,812
CURRENT LIABILITIES
Current portion of long-term borrowings		12		12,323			20,074
Trade accounts payable		8		2,097			1,720
Accrued liabilities and other payables		9		1,417			1,099
Derivative financial instruments		18		-			738
Deferred revenue		2.4		534			1,387
Total current liabilities				16,371			25,018
Long-term borrowings associated with Vessel classified as held for sale		12		6,150			6,710
				22,521			31,728
TOTAL LIABILITIES				95,322			110,540
TOTAL EQUITY AND LIABILITIES				155,662			165,722

The accompanying notes form an integral part of these financial statements.

F-3

~~F-4~~

GLOBUS MARITIME LIMITED

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(Expressed in thousands of U.S. Dollars, except per share data)

			For the year ended December 31,
	Notes		2013			2012			2011
REVENUE:
Time charter revenue				29,434			32,197			35,559

EXPENSES & OTHER OPERATING INCOME:
Voyage expenses		14		(2,892	)		(4,450	)		(3,283	)
Vessel operating expenses		14		(10,031	)		(10,400	)		(7,967	)
Depreciation		5		(5,622	)		(11,255	)		(10,180	)
Depreciation of dry docking costs		5		(434	)		(763	)		(318	)
Amortization of fair value of time charter attached to vessels		5		(1,261	)		(1,823	)		(779	)
Administrative expenses		15		(2,092	)		(1,869	)		(2,078	)
Administrative expenses payable to related parties		4		(620	)		(598	)		(1,150	)
Share based payments		13		189			(977	)		(364	)
Impairment gain/(loss)		5		1,679			(80,244	)		-
Other income/(expenses), net				127			(68	)		(124	)

Operating profit/(loss) before financing activities				8,477			(80,250	)		9,316

Interest income from bank balances and bank deposits				41			47			52
Interest expense and finance costs		16		(3,571	)		(3,358	)		(2,821	)
Gain on derivative financial instruments		18		738			693			369
Foreign exchange (losses)/gains, net				(8	)		64			9
Total finance costs, net				(2,800	)		(2,554	)		(2,391	)

TOTAL PROFIT/(LOSS) FOR THE YEAR				5,677			(82,804	)		6,925
Other Comprehensive Income				-			-			-
TOTAL COMPREHENSIVE INCOME/(LOSS) FOR THE YEAR				5,677			(82,804	)		6,925

Earnings/(loss) per share (U.S.$):
- Basic earnings/(loss) per share for the year		11		0.52			(8.22	)		0.80
- Diluted earnings/(loss) per share for the year		11		0.52			(8.22	)		0.79

The accompanying notes form an integral part of these financial statements.

F-4

GLOBUS MARITIME LIMITED

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

(Expressed in thousands of U.S. Dollars, except share and per share data)

Common Stock
Pre-reverse split equivalent
Number of Par Number of Par
Issued
share
Share Retained Total
Shares Value Shares Value Capital Premium Earnings Equity

Balance at January 1, 2008 28,636,153 0.001 7,159,039 0.004 29 87,411 9,237 96,677
Profit for the year - - - - - - 42,818 42,818
Other comprehensive income/(loss) - - - - - - - -
Total comprehensive income for the year - - - - - - 42,818 42,818
Share based payment (note 13) 29,297 0.001 7,324 0.004 - 189 581 770
Dividends paid (note 17) - - - - - - (18,482 ) (18,482 )
Balance at December 31, 2008 28,665,450 0.001 7,166,363 0.004 29 87,600 34,154 121,783
Loss for the year - - - - - - (10,079 ) (10,079 )
Other comprehensive income/(loss) - - - - - - - -
Total comprehensive loss for the year - - - - - - (10,079 ) (10,079 )
Share based payment (note 13) 290,722 0.001 72,680 0.004 - 916 838 1,754
Dividends paid (note 17) - - - - - - - -
Balance at December 31,2009 28,956,172 0.001 7,239,043 0.004 29 88,516 24,913 113,458
Profit for the year - - - - - - 6,003 6,003
Other comprehensive income/(loss) - - - - - - - -
Total comprehensive income for the year - - - - - - 6,003 6,003
Share based payment (note 13) 202,580 0.001 50,645 0.004 - 301 10 311
Dividends paid (note 17) - - - - - - (1,984 ) (1,984 )
Balance at December 31, 2010 29,158,752 0.001 7,289,688 0.004 29 88,817 28,942 117,788

	Issued share		Share			(Accumulated Deficit)/
	Capital		Premium			Retained			Total
	(note 10)		(note 10)			Earnings			Equity
Balance at January 1, 2011		29		88,817			28,942			117,788
Profit for the year		-		-			6,925			6,925
Other comprehensive income		-		-			-			-
Total comprehensive income for the year		-		-			6,925			6,925
Proceeds from public offering (note 10)		11		21,989			-			22,000
Transaction costs (note 10)		-		(1,952	)		-			(1,952	)
Share based payment (note 13)		-		375			(11	)		364
Dividends paid (note 17)		-		-			(5,106	)		(5,106	)
Balance at December 31, 2011		40		109,229			30,750			140,019
Loss for the year		-		-			(82,804	)		(82,804	)
Other comprehensive income		-		-			-			-
Total comprehensive loss for the year		-		-			(82,804	)		(82,804	)
Share based payment (note 13)		1		524			452			977
Dividends paid (note 17)		-		-			(3,010	)		(3,010	)
Balance at December 31, 2012		41		109,753			(54,612	)		55,182
Profit for the year		-		-			5,677			5,677
Other comprehensive income		-		-			-			-
Total comprehensive income for the year		-		-			5,677			5,677
Share based payment (note 13)		-		50			(239	)		(189	)
Dividends paid (note 17)		-		-			(330	)		(330	)
Balance at December 31, 2013		41		109,803			(49,504	)		60,340

The accompanying notes form an integral part of these financial statements.

F-5

~~F-5~~

GLOBUS MARITIME LIMITED

CONSOLIDATED STATEMENT OF CASH FLOWS

(Expressed in thousands of U.S. Dollars)

For the year ended December 31,
Notes 2010 2009 2008
Cash flows from operating activities:
Profit/(loss) for the year 6,003 (10,079 ) 42,818
Adjustments for:
Depreciation 5 7,367 11,204 17,407
Depreciation of drydocking costs 5 410 1,512 1,572
Payment of drydocking costs 5 (19 ) (1,135 ) (2,823 )
(Gain)/loss on sale of vessels 19 (7 ) 802 (15,095 )
Impairment loss 5 - 28,429 20,224
Provision for staff retirement indemnities 2.19 13 13 -
Loss/(gain) on derivative financial instruments 18 570 (143 ) 1,373
Interest expense and finance costs 16 2,133 2,926 7,707
Interest income (247 ) (1,032 ) (946 )
Foreign exchange losses, net 36 178 626
Share based payment 13 311 1,754 770
(Increase)/decrease in:
Trade receivables, net 55 494 (795 )
Inventories (112 ) 210 (12 )
Prepayments and other assets (149 ) (46 ) (591 )
Increase/(decrease) in:
Trade accounts payable 188 (1,054 ) (881 )
Accrued liabilities and other payables (385 ) 380 110
Deferred revenue 15 (847 ) (1,081 )
Net cash generated from operating activities 16,182 33,566 70,383

Cash flows from investing activities:
Vessel acquisitions 5 (106,084 ) - -
Vessels improvements 5 - - (307 )
Time deposits with maturity of three months or more - 10,000 (10,000 )
Net proceeds from sale of vessels 5,19 33,037 49,031 36,752
Purchases of office furniture and equipment (26 ) (2 ) (24 )
Interest received 354 1,224 656
Net cash (used in)/generated from investing activities (72,719 ) 60,253 27,077

Cash flows from financing activities:
Proceeds from issuance of long-term debt 12 62,170 - 95,000
Repayment of long-term debt 12 (36,082 ) (87,038 ) (120,635 )
Pledged bank deposits 5,000 15,400 (21,400 )
Restricted cash - - 732
Payment of financing costs (200 ) - (284 )
Dividends paid 17 (1,984 ) - (18,482 )
Interest paid (1,870 ) (2,858 ) (7,788 )
Net cash generated from/(used in) financing activities 27,034 (74,496 ) (72,857 )

Net (decrease)/increase in cash and cash equivalents (29,503 ) 19,323 24,603
Foreign exchange losses on cash and bank deposits (36 ) (108 ) (2 )
Cash and cash equivalents at the beginning of the year 3 53,157 33,942 9,341
Cash and cash equivalents at the end of the year 3 23,618 53,157 33,942

			For the year ended December 31,
	Notes		2013			2012			2011
Cash flows from operating activities:
Profit/(loss) for the year				5,677			(82,804	)		6,925
Adjustments for:
Depreciation		5		5,622			11,255			10,180
Depreciation of deferred dry docking costs		5		434			763			318
Amortization of fair value of time charter attached to vessels		5		1,261			1,823			779
Payment of deferred dry docking costs		5		(811	)		(941	)		(485	)
Impairment (gain)/loss		5		(1,679	)		80,244			-
Provision for staff retirement indemnities				(13	)		11			10
Gain on derivative financial instruments		18		(738	)		(693	)		(369	)
Interest expense and finance costs		16		3,571			3,358			2,821
Interest income				(41	)		(47	)		(52	)
Foreign exchange gains, net				(18	)		(3	)		(10	)
Share based payment		13		(189	)		977			364
(Increase)/decrease in:
Trade receivables, net				(118	)		658			(1,105	)
Inventories				25			(104	)		(87	)
Prepayments and other assets				(381	)		(621	)		(689	)
Increase/(decrease) in:
Trade accounts payable				377			775			(401	)
Accrued liabilities and other payables				231			(91	)		524
Deferred revenue				(853	)		(190	)		1,051
Net cash generated from operating activities				12,357			14,370			19,774
Cash flows from investing activities:
Vessel acquisitions		5		-			-			(61,774	)
Vessel improvements		5		-			(345	)		-
Time deposits with maturities of three months or more				(1,000	)		-			-
Purchases of office furniture and equipment				(58	)		(49	)		(53	)
Interest received				42			53			45
Net cash used in investing activities				(1,016	)		(341	)		(61,782	)
Cash flows from financing activities:
Proceeds from issuance of long-term debt		12		2,000			-			37,000
Repayment of long-term debt				(16,425	)		(5,425	)		(22,296	)
Pledged bank deposits		3		1,000			-			(1,000	)
Proceeds from issuance of share capital net of transaction costs				-			-			20,048
Payment of financing costs				-			-			(240	)
Dividends paid		17		(163	)		(3,010	)		(5,106	)
Interest paid				(3,535	)		(3,245	)		(2,725	)
Net cash (used in)/generated from financing activities				(17,123	)		(11,680	)		25,681
Net (decrease)/increase in cash and cash equivalents				(5,782	)		2,349			(16,327	)
Foreign exchange gains on cash and bank deposits				18			3			10
Cash and cash equivalents at the beginning of the year		3		9,653			7,301			23,618
Cash and cash equivalents at the end of the year		3		3,889			9,653			7,301

The accompanying notes form an integral part of these financial statements.

F-6

~~F-6~~

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. ~~Dollars -~~Dollars- except for share and per share data, unless otherwise stated)

Basis of presentation and general information

The accompanying consolidated financial statements include the financial statements ofGlobus Maritime Limited (“Globus”) and its wholly owned subsidiaries (collectively the “Company”). Globus was formed on July 26, 2006 under the laws of Jersey. On June 1, 2007, Globus concluded its initial public offering in the United Kingdom and its shares were admitted for trading on the Alternative Investment Market ~~on the London Stock Exchange~~ (“AIM”). On November 24, 2010 Globus was redomiciled ~~into~~to the Marshall Islands and its shares were admitted for trading in the United States ~~on the NASDAQ~~(NASDAQ Global ~~Market pursuant to a registration statement filed~~Market) under the Securities Act of 1933, as amended. On November 26, 2010 ~~Globus’~~Globus shares were effectively delisted from AIM.

On June 30, 2011 Globus completed its first follow-on public offering in the United States under the Securities Act of 1933, as amended, the net proceeds of which amounted to $20,048 (note 10).

The address of the registered office of Globus isis: Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH96960.

The principal business of the Company is the ownership and operation of a fleet of dry bulk motor vessels (“m/v”), providing maritime services for the transportation of dry cargo products on a worldwide basis. The Company conducts its operations through its ~~vessel-owning~~vessel owning subsidiaries.

The consolidated financial statements of ~~the Company~~Globus and its subsidiaries include the financial statements of the following companies:

Company	Country of ~~Incorporation/Redomiciliation~~ Incorporation	Date of Incorporation/Redomiciliation	Activity

Globus Maritime Limited	Marshall Islands	November 24, 2010	Holding Co.

Globus Shipmanagement Corp.	Marshall Islands	July 26, 2006	Management Co.

The operations of the vessels are managed by Globus Shipmanagement Corp. (the “Manager”), a wholly owned Marshall Islands corporation. The Manager has an office in Greece, located at 128 Vouliagmenis Avenue, 166 74 Glyfada, Greece and provides the commercial, technical, cash management and accounting services necessary for the operation of the fleet in exchange for a management fee. The management fee is eliminated on consolidation.

The consolidated financial statements also include the financial statements of the following vessel-owning subsidiaries, all wholly owned by ~~Globus~~the Company as of December 31, ~~2010, 2009~~2013, 2012 and ~~2008:~~

2011:

Company	Country of Incorporation	Vessel Delivery Date	Vessel Owned

~~Chantal Maritime Co.~~Sibelle Marine Inc. (The company was dissolved on ~~February 19, 2010)~~	~~Marshall Islands~~	~~September 15, 2006~~	~~m/v Ocean Globe (sold~~ ~~in November 2008)~~
~~Sibelle Marine Inc.~~October 14, 2011)	Marshall Islands	September 26, 2006	m/v Sea Globe (Sold in February 2010)

Supreme Navigation Co. (The company was dissolved on October 18, 2013)	Marshall Islands	November 14, 2006	m/v Coral Globe (Sold in February 2010)

~~F-7~~

~~GLOBUS MARITIME LIMITED~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Amounts presented in thousands of U.S. Dollars - except for share and per share data, unless otherwise stated)~~

1.	~~Basis of presentation and general information (continued)~~

~~Company~~	~~Country of~~ ~~Incorporation~~	~~Vessel Delivery~~ ~~Date~~	~~Vessel Owned~~

Adagio Marine S.A. (The company was dissolved on October 14, 2011)	Marshall Islands	December 6, 2006	m/v Lake Globe (sold in November 2009)

Abrosa Shipping Inc. (The company was dissolved on May 16, 2011)	Marshall Islands	January 11, 2007	m/v Gulf Globe (sold in October 2009)

Eleanor Maritime Limited ~~(the~~(The company was dissolved on January 25, 2011)	Marshall Islands	July 9, 2007	m/v Island Globe (sold in September 2009)

Devocean Maritime Ltd.	Marshall Islands	December 18, 2007	m/v River Globe

Elysium Maritime Limited	Marshall Islands	December 18, 2007	m/v Tiara Globe

Domina Maritime Ltd.	Marshall Islands	May 19, 2010	m/v Sky Globe

Dulac Maritime S.A.	Marshall Islands	May 25, 2010	m/v Star Globe

Kelty Marine Ltd.	Marshall Islands	June 29, 2010	m/v Jin Star

Artful Shipholding S.A.	Marshall Islands	June 22, 2011	m/v Moon Globe

Longevity Maritime Limited	Malta	September 15, 2011	m/v Sun Globe

Rosario Maritime Inc.	Marshall Islands	-	Dormant

F-7

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. Dollars- except for share and per share data, unless otherwise stated)

Basis of presentation and general information (continued)

The consolidated financial statements as of December 31, ~~2010~~2013 and ~~2009~~2012 and for the three years in the period ended December 31, ~~2010,~~2013, were approved for issuance by the Board of Directors on ~~March~~April 24, ~~2011.~~

2014.

Basis of Preparation and Significant Accounting Policies

2.1

Basis of Preparation:The consolidated financial statements have been prepared on a historical cost basis, except for vessel classified as held for sale and derivative financial instruments that have been measured at fair value. The consolidated financial statements are presented in U.S. dollars and all values are rounded to the nearest thousand ($ 000s) except when otherwise indicated.

Statement of Compliance:These consolidated financial statements of the Company have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). The Company also previously prepared consolidated financial statements as of December 31, 2009 and for the years ended December 31, 2009 and 2008, in accordance with IFRS as endorsed by the European Union (“EU”). There are no significant differences between the Company’s consolidated financial statements prepared in accordance with IFRS as issued by the IASB and the Company’s consolidated financial statements prepared in accordance with IFRS as endorsed by the EU.

Basis of Consolidation:The consolidated financial statements comprise the financial statements of Globus and its subsidiaries listed in note 1. The financial statements of the subsidiaries are prepared for the same reporting period as ~~Globus,~~the Company, using consistent accounting policies.

All inter-company balances and transactions have been eliminated upon consolidation. Subsidiaries are fully consolidated from the date on which control is transferred to the Company and cease to be consolidated from the date on which control is transferred out of the Company.

2.2

Standards amendments and interpretations:

The ~~Company has~~accounting policies adopted are consistent with those of previous financial year except for the following ~~new and~~ amended IFRS ~~and IFRIC interpretations~~which have been adopted by the Company as of January 1, ~~2010:~~

2013.

~~IFRIC 17, “Distributions~~IAS 1 Financial Statement Presentation (Amended) – Presentation of ~~Non-cash~~items of Other Comprehensive Income (“OCI”): The amendments to IAS 1 change the grouping of items presented in OCI. Items that could be reclassified (or ‘recycled’) to profit or loss at a future point in time (for example, net gain on hedge of net investment, exchange differences on translation of foreign operations, net movement on cash flow hedges and net loss or gain on available-for-sale financial assets) would be presented separately from items that will never be reclassified for example, actuarial gains and losses on defined benefit plans and revaluation of land and buildings). The amendment affects presentation only and it has no impact on the Company’s financial position or performance.

IAS 19 Employee Benefits (Revised): IAS 19 initiates a number of amendments to the accounting for defined benefit plans, including actuarial gains and losses that are now recognised in other comprehensive income (OCI) and permanently excluded from profit and loss; expected returns on plan assets that are no longer recognised in profit or loss, instead, there is a requirement to recognise interest on the net defined benefit liability (asset) in profit or loss, calculated using the discount rate used to measure the defined benefit obligation, and; unvested past service costs are now recognised in profit or loss at the earlier of when the amendment occurs or when the related restructuring or termination costs are recognised. Other amendments include new disclosures, such as, quantitative sensitivity disclosures. In case of the Company, the amendment had not materially affected the financial position or performance of the Company.

IAS 28 Investments in Associates and Joint Ventures (as revised in 2011). As a consequence of the new IFRS 11 and IFRS 12, IAS 28 has been renamedIAS 28 Investments in Associates and Joint Ventures, and describes the application of the equity method to investments in joint ventures in additions to associates. The amendment had no impact on the Company’s financial position or performance.

IFRS 7 Financial Instruments: Disclosures (Amended) - Offsetting Financial Assets and Financial Liabilities: This amendment requires an entity to ~~Owners”~~disclose information about rights to set-off and related arrangements (e.g. collateral agreements). The disclosures would provide users with information that is useful in evaluating the effect of netting arrangements on an entity’s financial position. The new disclosures are required for all recognized financial instruments that are set off in accordance with IAS 32 Financial Instruments: Presentation. The disclosures also apply to recognized financial instruments that are subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are set off in accordance with IAS 32. The amendment affects presentation only and it has no impact on the Company’s financial position or performance.

IFRS 10 Consolidated Financial Statements, IAS 27 Separate Financial Statements: IFRS 10 replaces the portion ofIAS 27 Consolidated and Separate FinancialStatements that addresses the accounting for consolidated financial statements. It also includes the issues raised in SIC-12 Consolidation-Special Purpose Entities. IFRS 10 establishes a single control model that applies to all entities including special purpose entities.

F-8

~~IAS 39, “Financial Instruments: Recognition and Measurement (Amended)” – eligible hedged items~~

~~F-8~~

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. ~~Dollars -~~Dollars- except for share and per share data, unless otherwise stated)

Basis of Preparation and Significant Accounting Policies (continued)

2.2

Standards amendments and ~~interpretations:~~interpretations (continued):

The changes introduced by IFRS 10 will require management to exercise significant judgment to determine which entities are controlled, and therefore, are required to be consolidated by a parent, compared with the requirements that were in IAS 27. The application of this new standard had no impact on the Company’s financial position or performance since the new definition of control did not change the status of the subsidiaries.

IFRS ~~2, “Group Cash-settled Share-based Payment Transactions”(Amended)~~11 Joint Arrangements: IFRS 11 replacesIAS 31 Interest in Joint Ventures andSIC- 13 Jointly-Controlled Entities- Non-monetary Contributions by Venturers.IFRS 11 removes the option to account for jointly controlled entities (‘JCEs’) using proportionate consolidation. Instead, JCE’s that meet the definition of joint venture must be accounted for using the equity method. The application of this new standard had no impact on the Company’s financial position or performance as the Company has no interest in JCE’s.

IFRS ~~3, “Business Combinations (Revised)~~12 Disclosure of Involvement with Other Entities:IFRS 12 includes all of the disclosures that were previously in IAS 27 related to consolidated financial statements, as well as all of the disclosures that were previously included in IAS 31 and IAS ~~27 Consolidated~~28. These disclosures relate to an entity’s interests in subsidiaries, joint arrangements, associates and ~~Separate Financial Statements” (Amended)~~structured entities. A number of new disclosures are also required. The application of this new standard had no impact on the Company’s financial position or performance.

~~Improvements~~Transition Guidance (Amendments to IFRS ~~(May 2008) All~~10, IFRS 11 and IFRS 12):The IASB issued amendments ~~issued are effective~~to IFRS 10 Consolidated Financial Statements, IFRS 11 Joint Arrangements and IFRS 12 Disclosure of Interests in Other Entities. The amendments change the transition guidance to provide further relief from full retrospective application. The date of initial application in IFRS 10 is defined as ~~at December 31, 2009, apart from~~‘the beginning of the ~~following:~~annual reporting period in which IFRS 5 Non-current Assets Held for Sale and Discontinued Operations: clarifies when a subsidiary is classified as held for sale, all its assets and liabilities are classified as held for sale, even when the entity remains a non-controlling interest after the sale transaction. The amendment10 is applied ~~prospectively.~~

~~Improvements~~for the first time’. The assessment of whether control exists is made at ‘the date of initial application’ rather than at the beginning of the comparative period. If the control assessment is different between IFRS 10 and IAS 27/SIC-12, retrospective adjustments should be determined. However, if the control assessment is the same, no retrospective application is required. If more than one comparative period is presented, additional relief is given to require only one period to be restated. For the same reasons IASB has also amended IFRS ~~(April 2009)~~

~~Amendments resulting from improvements~~11 Joint Arrangements and IFRS 12 Disclosure of Interests in Other Entities to ~~IFRS (April 2009) to the following standards did not have an effect~~provide transition relief. The application of this amendment had no impact on the ~~accounting policies,~~ financial position or performance of the ~~Company:~~Company.

IFRS ~~2, “Share-based Payment”~~13 Fair Value Measurement: IFRS 13establishes a single source of guidance under IFRS for all fair value measurements. IFRS 13 does not change when an entity is required to use fair value, but rather provides guidance on how to measure fair value under IFRS when fair value is required or permitted. The application of this new standard has not impacted the fair value measurements of the Company. IFRS 13 also requires specific disclosures on fair values, some of which replace existing disclosure requirements in other standards, including IFRS 7 Financial Instruments: Disclosures Additional disclosure is provided by the Company were required.

~~IFRS 5, “Non-current Assets Held~~TheIASB has issued the Annual Improvements to IFRSs – 2009 – 2011 Cycle, which contains amendments to its standards and the related Basis for ~~Sale~~Conclusions. The annual improvements project provides a mechanism for making necessary, but non-urgent, amendments to IFRS. The below stated improvements had no impact on the presentation of the financial statements or the financial position and ~~Discontinued Operations”~~performance of the Company.

·Ø

~~IFRS 8, “Operating Segment Information”~~

IAS 1 ~~“Presentation~~Presentation of Financial ~~Statements”~~Statements:This improvement clarifies the difference between voluntary additional comparative information and the minimum required comparative information. Generally, the minimum required comparative period is the previous period.

·Ø

IAS ~~7, “Statement~~16 Property, Plant and Equipment:This improvement clarifies that major spare parts and servicing equipment that meet the definition of ~~Cash Flows”~~property, plant and equipment are not inventory.

·Ø

IAS ~~17, “Leases”~~32 Financial Instruments, Presentation:This improvement clarifies that income taxes arising from distributions to equity holders are accounted for in accordance with IAS 12 Income Taxes.

·Ø

IAS ~~18, “Revenue”~~34 Interim Financial Reporting:The amendment aligns the disclosure requirements for total segment assets with total segment liabilities in interim financial statements. This clarification also ensures that interim disclosures are aligned with annual disclosures.

~~IAS 36, “Impairment of Assets”~~

~~IAS 38, “Intangible Assets”~~

~~IAS 39, “Financial Instruments: Recognition and Measurement”~~

~~IFRIC 9, “Reassessment of Embedded Derivatives”~~

~~IFRIC 16, “Hedges of a Net Investment in a Foreign Operation”~~

Standards issued but not yet effective and not early adopted:

IAS 32 Financial Instruments: Presentation (Amended) - Offsetting Financial Assets and Financial Liabilities:The amendment is effective for annual periods beginning on or after January 1, 2014. This amendment clarifies the meaning of “currently has a legally enforceable right to set-off” and also clarifies the application of the IAS 32 offsetting criteria to settlement systems (such as central clearing house systems) which apply gross settlement mechanisms that are not simultaneous. This amendment affects presentation only and has no impact on financial position or performance of the Company.

F-9

·	~~IFRIC 19, “Extinguishing Financial Liabilities with Equity Instruments”~~

The interpretation is effective for annual periods beginning on or after July 1, 2010. This interpretation addresses the accounting treatment when there is a renegotiation between the entity and the creditor regarding the terms of a financial liability and the creditor agrees to accept the entity’s equity instruments to settle the financial liability fully or partially. IFRIC 19 clarifies such equity instruments are “consideration paid” in accordance with paragraph 41 of IAS 39. As a result, the financial liability is derecognized and the equity instruments issued are treated as consideration paid to extinguish that financial liability. The Company does not expect that the amendment will have impact on the financial position or performance of the Company, as the Company does not expect to settle any of its financial liabilities by the use of an equity instrument.

·	~~IFRIC 14, “Prepayments of a Minimum Funding Requirement” (Amended)~~

The amendment is effective for annual periods beginning on or after January 1, 2011. The purpose of this amendment was to permit entities to recognize as an asset some voluntary prepayments for minimum funding contributions. Earlier application is permitted and must be applied retrospectively. The Company does not expect that the amendment will have impact on the financial position or performance of the Company, as the Company did not have or expect to have any such voluntary prepayments.

~~F-9~~

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. ~~Dollars -~~Dollars- except for share and per share data, unless otherwise stated)

Basis of Preparation and Significant Accounting Policies (continued)

2.2

Standards amendments and ~~interpretations:~~interpretations (continued):

IFRS 9 Financial Instruments – Classification and Measurement and subsequent amendments to IFRS 9 and IFRS 7-Mandatory Effective Date and Transition Disclosures; Hedge Accounting and amendments to IFRS 9, IFRS 7 and IAS 39:IFRS 9, as issued, reflects the first phase of the IASBs work on the replacement of IAS 39 and applies to classification and measurement of financial assets and financial liabilities as defined in IAS 39. The adoption of the first phase of IFRS 9 will have an effect on the classification and measurement of financial assets, but will not have an impact on classification and measurements of financial liabilities. In subsequent phases, the IASB will address hedge accounting and impairment of financial assets. The subsequent package of amendments issued in November 2013 initiate further accounting requirements for financial instruments. These amendments a) bring into effect a substantial overhaul of hedge accounting that will allow entities to better reflect their risk management activities in the financial statements; b) allow the changes to address the so-called ‘own credit’ issue that were already included in IFRS 9 Financial Instruments to be applied in isolation without the need to change any other accounting for financial instruments; and c) remove the 1 January 2015 mandatory effective date of IFRS 9, to provide sufficient time for preparers of financial statements to make the transition to the new requirements. The Company is in the process of assessing the impact of the new standard on the financial position or performance of the Company.

Investment Entities (Amendments to IFRS 10, IFRS 12 and IAS 27):The amendment is effective for annual periods beginning on or after 1 January 2014. The amendment applies to a particular class of business that qualify as investment entities. The IASB uses the term ‘investment entity’ to refer to an entity whose business purpose is to invest funds solely for returns from capital appreciation, investment income or both. An investment entity must also evaluate the performance of its investments on a fair value basis. Such entities could include private equity organisations, venture capital organisations, pension funds, sovereign wealth funds and other investment funds. Under IFRS 10 Consolidated Financial Statements, reporting entities were required to consolidate all investees that they control (i.e. all subsidiaries). The Investment Entities amendment provides an exception to the consolidation requirements in IFRS 10 and requires investment entities to measure particular subsidiaries at fair value through profit or loss, rather than consolidate them. The amendment also sets out disclosure requirements for investment entities. The application of this amendment is not expected to have an impact on the financial position or performance of the Company since the Company is not an investment entity.

IFRS 14 Regulatory Deferral Accounts: The standard is effective for annual periods beginning on or after 1 January 2016. The IASB has a project to consider the broad issues of rate regulation and plans to publish a Discussion Paper on this subject in 2014. Pending the outcome of this comprehensive Rate-regulated Activities project, the IASB decided to develop IFRS 14 as an interim measure. IFRS 14 permits first-time adopters to continue to recognise amounts related to rate regulation in accordance with their previous GAAP requirements when they adopt IFRS. However, to enhance comparability with entities that already apply IFRS and do not recognise such amounts, the standard requires that the effect of rate regulation must be presented separately from other items. An entity that already presents IFRS financial statements is not eligible to apply the standard. The new standard is not expected to have an impact on the Company’s financial position or performance as the Company does not operate in a rate regulated industry.

IAS 36 Impairment of Assets (Amended) – Recoverable Amount Disclosures for Non-Financial Assets: This amendment is effective for annual periods beginning on or after 1 January 2014. These amendments remove the unintended consequences of IFRS 13 on the disclosures required under IAS 36. In addition, these amendments require disclosure of the recoverable amounts for the assets or CGUs for which impairment loss has been recognised or reversed during the period. This amendment is not expected to have an impact on the Company’s financial position or performance.

IAS 39 Financial Instruments (Amended): Recognition and Measurement - Novation of Derivatives and Continuation of Hedge Accounting: This amendment is effective for annual periods beginning on or after 1 January 2014. Under the amendment there would be no need to discontinue hedge accounting if a hedging derivative was novated, provided certain criteria are met. The IASB made a narrow-scope amendment to IAS 39 to permit the continuation of hedge accounting in certain circumstances in which the counterparty to a hedging instrument changes in order to achieve clearing for that instrument. This amendment is not expected to have an impact on the Company’s financial position or performance.

IAS 19 Defined Benefit Plans (Amended): Employee Contributions: The amendment is effective from 1 July 2014. The amendment applies to contributions from employees or third parties to defined benefit plans. The objective of the amendment is to simplify the accounting for contributions that are independent of the number of years of employee service, for example, employee contributions that are calculated according to a fixed percentage of salary. The Company is in the process of assessing the impact of the new standard on the financial position or performance of the Company.

F-10

·	~~IFRS 9, “Financial Instruments” – Phase 1 financial assets, classification and measurement~~

The new standard is effective for annual periods beginning on or after January 1, 2013. Phase 1 of this new IFRS introduces new requirements for classifying and measuring financial assets. Early adoption is permitted. The Company is in the process of assessing the impact of the new standard on the financial position or performance of the Company.

·	~~IAS 32, “Classification on Rights Issues” (Amended)~~

The amendment is effective for annual periods beginning on or after February 1, 2010. This amendment relates to the rights issues offered for a fixed amount of foreign currency which were treated as derivative liabilities by the existing standard. The amendment states that if certain criteria are met, these should be classified as equity regardless of the currency in which the exercise price is denominated. The amendment is to be applied retrospectively. The Company does not expect that this amendment will have an impact on the financial position or performance of the Company.

·	~~IAS 24, “Related Party Disclosures” (Revised)~~

The revision is effective for annual periods beginning on or after January 1, 2011. This revision relates to the judgment which is required so as to assess whether a government and entities known to the reporting entity to be under the control of that government are considered a single customer. In assessing this, the reporting entity shall consider the extent of economic integration between those entities. Early application is permitted and adoption shall be applied retrospectively. The Company does not expect that this amendment will have an impact on the financial position or performance of the Company.

In May 2010, the IASB issued its third omnibus of amendments to its standards, primarily with a view to removing inconsistencies and clarifying wording. The effective dates of the improvements are various and the earliest is for the financial year beginning July 1, 2010. Early application is permitted in all cases.

· IFRS 1, “First-time Adoption of International Financial Reporting Standards” is effective for annual periods beginning on or after January 1, 2011. This improvement clarifies the treatment of accounting policy changes in the year of adoption after publishing an interim financial report in accordance with IAS 34 Interim Financial Reporting, allows first-time adopters to use an event-driven fair value as deemed cost and expands the scope of ‘deemed cost’ for property, plant and equipment or intangible assets to include items used subject to rate regulated activities.

· IFRS 3, “Business Combinations” is effective for annual periods beginning on or after July 1, 2010. This improvement clarifies that the amendments to IFRS 7 Financial Instruments: Disclosures, IAS 32 Financial Instruments: Presentation and IAS 39 Financial Instruments: Recognition and Measurement, that eliminate the exemption for contingent consideration, do not apply to contingent consideration that arose from business combinations whose acquisition dates precede the application of IFRS 3 (as revised in 2008). Moreover, this improvement limits the scope of the measurement choices (fair value or at the present ownership instruments’ proportionate share of the acquiree’s identifiable net assets) only to the components of non-controlling interest that are present ownership interests that entitle their holders to a proportionate share of the entity’s net assets. Finally, it requires an entity (in a business combination) to account for the replacement of the acquiree’s share-based payment transactions (whether obliged or voluntarily), i.e., split between consideration and post combination expenses.

· IFRS 7, “Financial Instruments: Disclosures” is effective for annual periods beginning on or after January 1, 2011. This improvement gives clarifications of disclosures required by IFRS 7 and emphasizes the interaction between quantitative and qualitative disclosures and the nature and extent of risks associated with financial instruments.

~~F-10~~

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. ~~Dollars -~~Dollars- except for share and per share data, unless otherwise stated)

Basis of Preparation and Significant Accounting Policies (continued)

2.2

Standards amendments and ~~interpretations:~~interpretations (continued):

· ~~IAS 1, “Presentation of Financial Statements” is effective for annual periods beginning on or after January 1, 2011~~. This amendment clarifies that an entity will present an analysis of other comprehensive income for each component of equity, either in the statement of changes in equity or in the notes to the financial statements.

· IAS 27, “Consolidated and Separate Financial Statements” is effective for annual periods beginning on or after July 1, 2010. This improvement clarifies that the consequential amendments from IAS 27 made to IAS 21. The Effect of Changes in Foreign Exchange Rates, IAS 28 Investments in Associates and IAS 31. Interests in Joint Ventures apply prospectively for annual periods beginning on or after July 1, 2009 or earlier when IAS 27 is applied earlier.

· IAS 34, “Interim Financial Reporting” is effective for annual periods beginning on or after January 1, 2011. This improvement provides guidance to illustrate how to apply disclosure principles in IAS 34 and adds disclosure requirements.

· IFRIC 13, “Customer Loyalty Programmes” is effective for annual periods beginning on or after January 1, 2011. This improvement clarifies that when the fair value of award credits is measured based on the value of the awards for which they could be redeemed, the amount of discounts or incentives otherwise granted to customers not participating in the award credit scheme is to be taken into account.

~~IFRS 7, “Financial Instruments: Disclosures” as part of its comprehensive review of off balance sheet activities (Amended)~~IFRIC Interpretation 21: Levies. The ~~amendment~~interpretation is effective for annual periods beginning on or after ~~July~~ 1 ~~2011.~~January 2014. The ~~purpose~~Interpretations Committee was asked to consider how an entity should account for liabilities to pay levies imposed by governments, other than income taxes, in its financial statements. This Interpretation is an interpretation of ~~this amendment~~IAS 37 Provisions, Contingent Liabilities and Contingent Assets. IAS 37 sets out criteria for the recognition of a liability, one of which is ~~to allow users of financial statements to improve their understanding of transfer transactions of financial assets (e.g., securitizations), including understanding~~ the ~~possible effects of any risks that may remain with~~requirement for the entity ~~that transferred the assets. The amendment also requires additional disclosures if~~to have a ~~disproportionate amount of transfer transactions are undertaken around the end~~present obligation as a result of a ~~reporting period.~~past event (known as an obligating event). The ~~amendments broadly align~~Interpretation clarifies that the obligating event that gives rise to a liability to pay a levy is the activity described in the relevant ~~disclosure requirements~~legislation that triggers the payment of ~~IFRSs and U.S. GAAP.~~the levy. The Company ~~does not expect that this amendment will have an~~is in the process of assessing the impact of the new standard on the financial position or performance ~~however additional disclosures may be required.~~

of the Company.

~~IAS 12, “Deferred tax: Recovery~~The IASB has issued the Annual Improvements to IFRSs 2010 – 2012 Cycle, which is a collection of ~~Underlying Assets” (Amended)~~amendments to IFRSs. The amendments are effective for annual periods beginning on or after 1 July 2014. The below stated improvements are not expected to have a material impact on the presentation of the financial statements or the financial position and performance of the Company.

IFRS 2 Share-based Payment: This improvement amends the definitions of 'vesting condition' and 'market condition' and adds definitions for 'performance condition' and 'service condition' (which were previously part of the definition of 'vesting condition').

The amendment is effective for annual periods beginning on or after January 1, 2012. This amendment concerns the determination of deferred tax on investment property measured at fair value and also incorporates SIC-21 Income Taxes — Recovery of Revalued Non-Depreciable Assets into IAS 12 for non-depreciable assets measured using the revaluation model in IAS 16.

The aim of this amendment is to include (a) a rebuttable presumption that deferred tax on investment property measured using the fair value model in IAS 40 should be determined on the basis that its carrying amount will be recovered through sale and (b) a requirement that deferred tax on non-depreciable assets, measured using the revaluation model in IAS 16, should always be measured on a sale basis. The Company does not expect that this amendment will have an impact on the financial position or performance of the Company.

IFRS 3 Business combinations: This improvement clarifies that contingent consideration in a business acquisition that is not classified as equity is subsequently measured at fair value through profit or loss whether or not it falls within the scope of IFRS 9 Financial Instruments.

IFRS 8 Operating Segments: This improvement requires an entity to disclose the judgments made by management in applying the aggregation criteria to operating segments and clarifies that an entity shall only provide reconciliations of the total of the reportable segments' assets to the entity's assets if the segment assets are reported regularly.

IFRS 13 Fair Value Measurement: This improvement in the Basis of Conclusion of IFRS 13 clarifies that issuing IFRS 13 and amending IFRS 9 and IAS 39 did not remove the ability to measure short-term receivables and payables with no stated interest rate at their invoice amounts without discounting if the effect of not discounting is immaterial.

IAS 16 Property Plant & Equipment: The amendment clarifies that when an item of property, plant and equipment is revalued, the gross carrying amount is adjusted in a manner that is consistent with the revaluation of the carrying amount.

IAS 24 Related Party Disclosures: The amendment clarifies that an entity providing key management personnel services to the reporting entity or to the parent of the reporting entity is a related party of the reporting entity.

IAS 38 Intangible Assets: The amendment clarifies that when an intangible asset is revalued the gross carrying amount is adjusted in a manner that is consistent with the revaluation of the carrying amount.

The IASB has issued the Annual Improvements to IFRSs 2011 – 2013 Cycle, which is a collection of amendments to IFRSs. The amendments are effective for annual periods beginning on or after 1 July 2014. The below stated improvements are not expected to have an impact on the presentation of the financial statements or the financial position and performance of the Company.

IFRS 3 Business Combinations: This improvement clarifies that IFRS 3 excludes from its scope the accounting for the formation of a joint arrangement in the financial statements of the joint arrangement itself.

IFRS 13 Fair Value Measurement: This improvement clarifies that the scope of the portfolio exception defined in paragraph 52 of IFRS 13 includes all contracts accounted for within the scope of IAS 39 Financial Instruments: Recognition and Measurement or IFRS 9 Financial Instruments, regardless of whether they meet the definition of financial assets or financial liabilities as defined in IAS 32 Financial Instruments: Presentation.

IAS 40 Investment Properties:This improvement clarifies that determining whether a specific transaction meets the definition of both a business combination as defined in IFRS 3 Business Combinations and investment property as defined in IAS 40 Investment Property requires the separate application of both standards independently of each other.

2.3

Significant accounting judgments, estimates and assumptions:The preparation of consolidated financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the amounts of revenues and expenses ~~recognized~~recognised during the reporting period. However, uncertainty about these assumptions and estimates could result in outcomes that could require a material adjustment to the carrying amount of the asset or liability affected in the future.

~~F-11~~

~~GLOBUS MARITIME LIMITED~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Amounts presented in thousands of U.S. Dollars - except for share and per share data, unless otherwise stated)~~

2.	~~Basis of Preparation and Significant Accounting Policies (continued)~~

~~2.3~~

~~Significant accounting judgments, estimates and assumptions (continued)~~

Judgments:In the process of applying the Company’s accounting policies, management has made the following judgments that had a significant effect on the amounts ~~recognized~~recognised in the financial statements.

F-11

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. Dollars- except for share and per share data, unless otherwise stated)

Basis of Preparation and Significant Accounting Policies (continued)

2.3

Significant accounting judgments, estimates and assumptions (continued)

Judgments (continued)

Non-current assets classified as held for sale:~~On November 11, 2009,~~By a board of directors’ resolutionon December 4, 2012, the Company ~~entered into a memorandum of agreement~~decided to actively market for sale the ~~sale of two vessels, namely~~vessel m/v ~~Sea Globe and m/v Coral~~Tiara Globe. The Company considered that the ~~vessels~~vessel met the criteria to be classified as held for sale at that date for the following reasons:

o·

The sale was considered to be highly probable and ~~the vessels were~~

The vessel was available for immediate sale in ~~their~~its present condition.

By a board of directors’ resolutionon November 20, 2013, the Company decided to continue to actively market for sale the vessel m/v Tiara Globe and extend the period that the vessel is classified as held for sale beyond a financial year.

oØ

~~The delivery was expected to take place during February 2010. The actual delivery of the vessels took place~~Allowance for doubtful trade receivables:Provisionsfor doubtful trade receivables are recorded based on ~~February 17, 2010.~~management’s expectations on future trade receivables recoveries.

Estimates and assumptions:The key assumptions concerning the future and other key sources of estimation uncertainty at the financial position date ~~which~~that have a significant risk of causing a significant adjustment to the carrying amount of assets and liabilities within the next financial year are discussed below.

·Ø

Carrying amount of vessels, net: Vessels are stated at cost, less accumulated depreciation (including depreciation of dry-docking costs and the amortization of the component attributable to favourable or unfavourable lease terms relative to market terms) and accumulated impairment losses. The estimates and assumptions that have the most significant effect on the vessels carrying amount are estimations in relation to useful lives of vessels, their salvage value and estimated ~~drydocking~~dry docking dates. The key assumptions used are further explained in notes ~~2.10~~2.9 to 2.13.

·Ø

Impairment of Non-Financial Assets: The Company’s impairment test for non-financial assets is based on the assets’ recoverable amount, where the recoverable amount is the greater of fair value less costs to sell and value in use. The Company engaged independent valuation specialists to determine the fair value of non-financial assets as at December 31, ~~2010.~~2013. The value in use calculation is based on a discounted cash flow model. The value in use calculation is most sensitive to the discount rate used for the discounted cash flow model as well as the expected net cash flows and the growth rate used for ~~extrapolation (refer~~extrapolation. See notes 2.13 and 5.

Share based payments:TheCompany measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. Estimating fair value for share-based payment transactions may require determination of the most appropriate valuation model, which is depended on the terms and conditions of the grant. This estimate also requires determination of the most appropriate inputs to the valuation model including, expected volatility and dividend yield and making assumptions about them. The assumptions and models used for estimating fair value for share-based payment transactions are disclosed in note ~~5).~~13.

2.4

Accounting for revenue and related expenses:The Company generates its revenues from charterers for the charter hire of its vessels. Vessels are chartered using time charters, bareboat charter and spot charters, where a contract is entered into for the use of a vessel for a specific period of time and a specified daily charter hire rate. If a time charter agreement exists and collection of the related revenue is reasonably assured, revenue is ~~recognized~~recognised on a straight line basis over the period of the time charter. Such revenues are treated in accordance with IAS 17 as lease income as explained in note 2.23 below. Associated voyage expenses, which primarily consist of commissions, are ~~recognized~~recognised on a pro-rata basis over the duration of the period of the time charter. Deferred revenue relates to cash received prior to the financial position date and is related to revenue earned after such date. Deferred revenue also includes the value ascribed to time charter agreements assumed upon the purchase of a vessel, if any. This ascribed amount is amortized over the remaining term of the time charter and the amortized portion for the period is included in revenue for the period.

Interest ~~income:~~income: Revenue is ~~recognized~~recognised as interest accrues (using the effective interest method).

Voyage ~~expenses:~~expenses: Voyage expenses primarily consist of port expenses and owners’ expenses paid by the charterer, canal and bunker expenses that are unique to a particular charter under time charter arrangements or by the Company under voyage charter arrangements. Furthermore, voyage expenses include commission on income paid by the Company. The Company defers bunker expenses under voyage charter agreements and amortizes them over the related voyage.

~~F-12~~

~~GLOBUS MARITIME LIMITED~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Amounts presented in thousands of U.S. Dollars - except for share and per share data, unless otherwise stated)~~

2.	~~Basis of Preparation and Significant Accounting Policies (continued)~~

~~2.4~~

~~Accounting for revenue and related expenses (continued)~~

Vessel operating expenses:Vessel operating expenses are accounted for on an accruals basis.

2.5

Foreign currency translation:The functional currency of Globus and its subsidiaries is the U.S. dollar, which is also the presentation currency of the Company, because the Company’s vessels operate in international shipping markets, whereby the U.S. dollar is the currency used for transactions. Transactions involving other currencies during the period are converted into U.S. dollars using the exchange rates in effect at the time of the transactions. At the financial position dates, monetary assets and liabilities, which are denominated in currencies other than the U.S. dollar, are translated into the functional currency using the period-end exchange rate. Gains or losses resulting from foreign currency transactions are included in foreign currency gain or loss in the consolidated statement of comprehensive income.

F-12

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. Dollars- except for share and per share data, unless otherwise stated)

Basis of Preparation and Significant Accounting Policies (continued)

2.5

Foreign currency translation (continued)

Transactions involving other currencies during the period are converted into U.S. dollars using the exchange rates in effect at the time of the transactions. At the financial position dates, monetary assets and liabilities, which are denominated in currencies other than the U.S. dollar, are translated into the functional currency using the period-end exchange rate. Gains or losses resulting from foreign currency transactions are included in foreign exchange gains/ (losses), net in the consolidated statement of comprehensive income.

2.6

Cash and cash equivalents:The Company considers highly liquid investments such as time deposits and certificates of deposit with original maturity of three months or less to be cash and cash equivalents.

2.7

~~Restricted cash:~~ Restricted cash refers to retention accounts that can only be used to fund the loan installments coming due. Under a loan facility, the Company was required to hold bank deposits, which were used to fund the loan installments coming due. These funds could only be used for the purpose of loan repayment and are shown as “Restricted cash” under current assets that as of December 31, 2010 and 2009 amounted to nil in the accompanying consolidated statement of financial position. The relevant loan facility was repaid during March 2008.

~~2.8~~

Trade receivables, net:The amount shown as trade receivables at each financial position date includes estimated recoveries from charterers for hire, freight and demurrage billings, net of an allowance for doubtful accounts. Trade receivables are measured at amortized cost less impairment losses, which are recognized in the consolidated statement of comprehensive income. At each financial position date, all potentially uncollectible accounts are assessed individually for the purpose of determining the appropriate allowance for doubtful accounts. ~~There is no~~The provision for doubtful accounts at December 31, ~~2010 and 2009.~~

2013 was $358 (2012:$331).

~~2.9~~

2.8

Inventories: Inventories consist of lubricants and gas cylinders and are stated at the lower of cost or net ~~realizable~~realisable value. The cost is determined by the first-in, first-out method.

~~2.10~~

2.9

Vessels, net: Vessels are stated at cost, less accumulated depreciation (including depreciation of dry-docking costs and components attributable to favourable or unfavourable lease terms relative to market terms) and accumulated impairment losses. Vessel cost consists of the contract price for the vessel and any material expenses incurred upon acquisition (initial repairs, improvements and delivery expenses, interest, commissions paid and on-site supervision costs incurred during the construction periods). Any seller’s credit, i.e., amounts received from the seller of the vessels until date of delivery is deducted from the cost of the vessel. Subsequent expenditures for conversions and major improvements are also ~~capitalized~~capitalised when the recognition criteria are met. Otherwise these amounts are charged to expenses as incurred. When the Company acquires a vessel with a time charter agreement assumed, the cost of acquisition is allocated between the individual assets and / or liabilities assumed based on their relative fair values at the time of acquisition. The time charter agreement assumed can be assigned a positive value (asset) or a negative value (deferred revenue) or zero value. During the year ended December 31, 2010, the Company acquired m/v Jin Star with a bareboat time charter assumed. The bareboat time charter agreement assumed was assigned a zero value since the terms of the agreement were considered to be at fair (market) value. During the years ended December 31, 2009 and 2008, no vessels were purchased with a time charter agreement attached.

~~F-13~~

~~GLOBUS MARITIME LIMITED~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Amounts presented in thousands of U.S. Dollars - except for share and per share data, unless otherwise stated)~~

2.	~~Basis of Preparation and Significant Accounting Policies (continued)~~

~~2.11~~2.10

Deferred dry-docking costs:~~Drydocking costs:~~ Vessels are required to be ~~drydocked~~dry-docked for major repairs and maintenance that cannot be performed while the vessels are operating. ~~Drydockings~~Dry-dockings occur approximately every 2.5 years. The costs associated with the ~~drydockings~~dry-dockings are ~~capitalized~~capitalised and depreciated on a straight-line basis over the period between ~~drydockings,~~dry-dockings, to a maximum of 2.5 ~~years. At~~years.At the date of acquisition of a ~~secondhand~~ vessel, management estimates the component of the cost that corresponds to the economic benefit to be derived until the first scheduled ~~drydocking~~dry-docking of the vessel under the ownership of the Company and this component is depreciated on a straight-line basis over the remaining period through the estimated ~~drydocking~~dry-docking date.

~~2.12~~

2.11

Depreciation: The cost of each of the Company’s vessels is depreciated on a straight-line basis over each vessel’s remaining useful economic life, after considering the estimated ~~salvage~~residual value of each vessel, beginning when the vessel is ready for its intended use. Management estimates that the useful life of new vessels is 25 years, which is consistent with industry practice. The ~~salvage~~residual value of a vessel is the product of its lightweight tonnage and estimated scrap value per lightweight ton. The residual values and useful lives are reviewed at each reporting date and adjusted prospectively, if appropriate. Historically changes in residual values have not resulted in material changes to the Company’s depreciation charge.

2.12

Amortization of lease component: When the Company acquires a vessel subject to an operating lease, it amortizes the amount reflected in the cost of that vessel that is attributable to favourable or unfavourable lease terms relevant to market terms, over the remaining term of the lease. The amortization is included in line “amortization of fair value of time charter attached to vessels” in the income statement component of the consolidated statement of comprehensive income.

2.13

Impairment of long-lived assets: The Company assesses at each reporting date whether there is an indication that a vessel may be impaired. The vessel’s recoverable amount is estimated when events or changes in circumstances indicate the carrying value may not be recoverable. If such indication exists and where the carrying value exceeds the estimated recoverable amounts, the vessel is written down to its recoverable amount. The recoverable amount is the greater of fair value less costs to sell and value-in-use. In assessing value-in-use, the estimated future cash flows are discounted to their present value using a discount rate that reflects current market assessments of the time value of money and the risks specific to the vessel. Impairment losses are ~~recognized~~recognised in the consolidated statement of comprehensive income. A previously ~~recognized~~recognised impairment loss is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was ~~recognized.~~recognised. If that is the case, the carrying amount of the asset is increased to its recoverable amount. That increased amount cannot exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been ~~recognized~~recognised for the asset in prior years. Such reversal is ~~recognized~~recognised in the consolidated statement of comprehensive income. After such a reversal, the depreciation charge is adjusted in future periods to allocate the asset’s revised carrying amount, less any residual value, on a systematic basis over its remaining useful life.

See note 5

F-13

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. Dollars- except for share and per share data, unless otherwise stated)

Basis of Preparation and Significant Accounting Policies (continued)

2.14

Long-term debt: Long-term debt is initially ~~recognized~~recognised at the fair value of the consideration received net of financing costs directly attributable to the borrowing. After initial recognition, long-term debt is subsequently measured at amortized cost using the effective interest rate method. Amortized cost is calculated by taking into account any financing costs and any discount or premium on settlement. Gains and losses are ~~recognized~~recognised in net profit or loss when the liabilities are ~~derecognized~~derecognised or impaired, as well as through the amortization process.

2.15

Financing costs: Fees incurred for obtaining new loans or refinancing existing loans are deferred and amortized over the life of the related debt, using the effective interest rate method. Any unamortized balance of costs relating to loans repaid or refinanced is expensed in the period the repayment or refinancing is made.

2.16

Borrowing costs:Borrowing costs consist of interest and other costs that the Company incurs in connection with the borrowing of funds.Borrowing costs are expensed to the income statement component of the consolidated statement of comprehensive income as incurred except borrowing costs that relate to a qualifying asset. A qualifying asset is an asset that necessarily takes a substantial period of time to get ready for its intended use. Borrowing costs that relate to qualifying assets are ~~capitalized.~~capitalised. For the years ended December 31, ~~2010, 2009~~2013, 2012 and ~~2008,~~2011, the Company had no qualifying assets.

~~F-14~~

~~GLOBUS MARITIME LIMITED~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Amounts presented in thousands of U.S. Dollars - except for share and per share data, unless otherwise stated)~~

2.	~~Basis of Preparation and Significant Accounting Policies (continued)~~

2.17

Operating segment: The Company reports financial information and evaluates its operations by charter revenues and not by length of ship employment for its customers i.e., spot or time charters. The Company does not use discrete financial information to evaluate the operating results for each such type of charter. Although revenue can be identified for these types of charters, management cannot and does not identify expenses, profitability or other financial information for these charters. As a result, management, ~~including the chief operating decision maker,~~ reviews operating results solely by revenue per day and operating results of the fleet and thus the Company has determined that it operates ~~under~~as one operating segment. Furthermore, when the Company charters a vessel to a charterer, the charterer is free to trade the vessel worldwide and, as a result, the disclosure of geographical information is impracticable.

2.18

Provisions and contingencies:Provisions are recognized when ~~(1)~~ the Company has a present legal or constructive obligation as a result of past events, ~~(2)~~ it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and, ~~(3)~~ a reliable estimate of the amount of the obligation can be made. Provisions are reviewed at each financial position date and adjusted to reflect the present value of the expenditure expected to be required to settle the obligation. Contingent liabilities are not recognized in the financial statements but are disclosed unless the possibility of an outflow of resources embodying economic benefits is remote, in which case there is no disclosure. Contingent assets are not recognized in the financial statements but are disclosed when an inflow of economic benefits is probable.

2.19

Pension and retirement benefit obligations:The crew on board the vessels owned by the ship-owning companies owned by Globus is under short-term contracts (usually up to nine months) and, accordingly, no one is liable for any pension or ~~post retirement~~post-retirement benefits payable to the crew.

Provision for employees’ severance compensation:The Greek employees, of the Company ~~located in Greece~~ are bound by the Greek Labour law. Accordingly, compensation is payable to such employees upon dismissal or retirement. The amount of compensation is based on the number of years of service and the amount of remuneration at the date of dismissal or retirement. If the ~~employees~~employees’ remain in the employment of the Company until normal retirement age, they are entitled to retirement compensation which is equal to 40% of the compensation amount that would be payable if they were dismissed at that time.

The number of employees that will remain with the Company until retirement age is not known. The Company has provided for the employees’ retirement compensation liability, an amount of ~~$56~~$64 as at December 31, ~~2010 (2009:~~2013 (2012:$~~43)~~77), calculated by using the Projected Unit Credit Method and disclosed under non-current liabilities in the consolidated statement of financial position.

2.20

Offsetting of financial assets and liabilities:Financial assets and liabilities are offset and the net amount is presented in the consolidated financial position only when the Company has a legally enforceable right to set off the ~~recognized~~recognised amounts and intend either to settle such asset and liability on a net basis or to realize the asset and settle the liability simultaneously.

2.21

Derecognition of financial assets and liabilities:

(i)

Financial assets: A financial asset (or, where applicable a part of a financial asset or part of a group of similar financial assets) is ~~derecognized~~derecognised where:

the rights to receive cash flows from the asset have expired;

the Company retains the right to receive cash flows from the asset, but has assumed an obligation to pay them in full without material delay to a third party under a “pass-through” arrangement; or

the Company has transferred its rights to receive cash flows from the asset and either (a) has transferred substantially all the risks and rewards of the assets, or (b) has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

F-14

~~F-15~~

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. ~~Dollars -~~Dollars- except for share and per share data, unless otherwise stated)

Basis of Preparation and Significant Accounting Policies (continued)

2.21

Derecognition of ~~Financial Assets~~financial assets and ~~Liabilities~~liabilities (continued)

Where the Company has transferred its rights to receive cash flows from an asset and has neither transferred nor retained substantially all the risks and rewards of the asset nor transferred control of the asset, the asset is ~~recognized~~recognised to the extent of the ~~Company~~Company’s continuing involvement in the asset.

Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Company could be required to repay.

(ii)

Financial liabilities: A financial liability is ~~derecognized~~derecognised when the obligation under the liability is discharged or cancelled or expires.

Where an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and, the difference in the respective carrying amounts is ~~recognized~~recognised in profit or loss.

2.22

Leases – where the Company is the lessee:Leases where a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to the income statement component of the consolidated statement of comprehensive income on a straight-line basis over the period of the lease.

2.23

Leases – where an entity is the lessor:Leases of vessels where the entity does not transfer substantially all the risks and benefits of ownership of the vessel are classified as operating leases. Lease income on operating leases is ~~recognized~~recognised on a straight-line basis over the lease term. Contingent rents are ~~recognized~~recognised as revenue in the period in which they are earned.

2.24

Insurance:The Company recognizes insurance claim recoveries for insured losses incurred on damage to vessels. Insurance claim recoveries are recorded, net of any deductible amounts, at the time the Company’s vessels suffer insured damages. They include the recoveries from the insurance companies for the claims, provided there is evidence the amounts are virtually certain to be received.

2.25

Share based compensation:~~The Company~~Globus operates an equity-settled, ~~share based~~share-based compensation ~~plan.~~plans. The value of the service received in exchange of the grant of shares is recognized as an expense. The total amount to be expensed over the vesting period is determined by reference to the fair value of the share awards at the grant date. The relevant expense is recognized in the income statement component of the consolidated statement of comprehensive income, with a corresponding impact in equity.

2.26

Share capital:Common shares and preferred shares are classified as equity. Incremental costs directly attributable to the issue of new shares are ~~recognized~~recognised in equity as a deduction from the proceeds.

2.27

Dividends:Dividends to shareholders are ~~recognized~~recognised in the period in which the dividends are declared and appropriately ~~authorized~~authorised and are accounted for as dividends payable until paid.

2.28

Derivative financial instruments at fair value through profit and loss: Derivative financial instruments are initially ~~recognized~~recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured at fair value. Historically, the Company’s derivative financial instruments have not qualified for hedge accounting, therefore changes in the fair value of these instruments are ~~recognized~~recognised immediately in the income statement component of the consolidated statement of comprehensive income.

~~F-16~~

~~GLOBUS MARITIME LIMITED~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Amounts presented in thousands of U.S. Dollars - except for share and per share data, unless otherwise stated)~~

2.	~~Basis of Preparation and Significant Accounting Policies (continued)~~

2.29

Non-current assets held for sale:Non-current assets and disposal groups classified as held for sale are measured at the lower of carrying amount and fair value less costs to sell. If the carrying amount exceeds fair value less costs to sell, the Company ~~recognizes~~recognises a loss under impairment ~~loss~~gain/ (loss) in the income statement component of the consolidated statement of comprehensive income, if the non-current asset or disposal group is subsequently remeasured at fair value less costs to sell, any difference with the carrying amount is recognised under impairment gain/ (loss) in the income statement component of the consolidated statement of comprehensive income. Non-current assets and disposal groups are classified as held for sale if their carrying amounts will be recovered through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable and the asset or disposal group is available for immediate sale in its present condition. Management must be committed to the sale, which should be expected to qualify for recognition as a complete sale within one year from the date of classification. ~~Property, plant~~Events or circumstances may extend the period to complete the sale beyond one year.

F-15

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. Dollars- except for share and per share data, unless otherwise stated)

Basis of Preparation and ~~equipment and intangible assets once classified as~~Significant Accounting Policies (continued)

2.29

Non-current asset held for sale (continued)

An extension of the period required to complete a sale does not preclude an asset from being classified as held for sale if the delay is caused by events or circumstances beyond the entity’s control and there is sufficient evidence that the entity remains committed to its plan to sell the asset. Property, plant and equipment and intangible assets once classified as held for sale are not depreciated or amortized. Refer to note 5.

2.30

Fair value measurement: The Company measures financial instruments, such as, derivatives, and non-financial assets such as vessels held for sale, at fair value at each reporting date. In addition fair values of financial instruments measured at amortised cost are ~~not depreciated~~disclosed in note 24. Fair value is the price that would be received to sell an asset or ~~amortized.~~paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either, a) in the principal market for the asset or the liability or b) in the absence of a principal market, in the most advantageous market for the asset or liability both being accessible by the Company. The fair value of an asset or a liability is measured using the assumptions that the market participants would use when pricing the asset or liability, assuming that the market participants act in their best economic interest. A fair value measurement of a non-financial asset takes into account the a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use. The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.

The Company uses the following hierarchy for determining and disclosing the fair value of assets and liabilities by valuation technique:

Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: techniques which use inputs which have a significant effect on the recorded fair value that are not based on observable market data.

For assets and liabilities that are recognised in the consolidated financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by reassessing categorization at the end of each reporting period.

The Company engaged independent valuation specialists to determine the fair value of non-financial assets

2.31

Current versus non-current classification: The Company presents assets and liabilities in the statement of financial position based on current/non-current classification.

An asset as current when it is:

Expected to be realised or intended to be sold or consumed in a normal operating cycle

Held primarily for the purpose of trading

Expected to be realised within twelve months after the reporting period

Cash or cash equivalent

All other assets are classified as non-current.

A liability is current:

It is expected to be settled in a normal operating cycle

It is held primarily for the purpose of trading

It is due to be settled within twelve months after the reporting period

There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.

All other liabilities are classified as non-current

F-16

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. Dollars- except for share and per share data, unless otherwise stated)

Cash and bank balances and bank deposits

For the purpose of the consolidated statement of financial position, cash and bank balances and bank deposits comprise the following:

December 31,
2010 2009
Cash on hand 6 8
Bank balances 686 1,315
Bank deposits 23,926 57,834
Total 24,618 59,157

	December 31,
	2013		2012
Cash on hand		7		13
Bank balances		1,982		1,278
Bank deposits		3,900		10,362
Total		5,889		11,653

The fair value of cash and bank balances and bank deposits as at December 31, 2013 and 2012 was $5,889 and $11,653 respectively. In addition as of December 31, 2013, the Company had available $2,000 (2012:$nil) of undrawn borrowing facilities (note 12)

As at December 31, 2013 and 2012, the Company had pledged a part of its bank deposits in order to fulfil collateral requirements. Refer to notes 12 and 18 for further details.

For the purpose of the consolidated statement of cash flows, cash and cash equivalents comprise the following:

	December 31,
	2013			2012
Cash and bank balances and bank deposits		5,889			11,653
Time deposits with maturities of three months or more		(1,000	)		-
Less: pledged bank deposits		(1,000	)		(2,000	)
Cash and cash equivalents		3,889			9,653

Cash held in banks earns interest at floating rates based on daily bank deposit rates. Bank deposits are made for varying periods of between one day and three months, depending on the immediate cash requirements of the Company and earn interest at the respective bank deposit rates. The fair value of cash and bank balances and bank deposits as at December 31, 2010 and 2009 was $24,618 and $59,157, respectively.

~~As at December 31, 2010 and 2009, the Company had pledged a part of its bank deposits in order to fulfill collateral requirements. Refer to note 18 for further details.~~

~~For the purpose of the consolidated statement of cash flow, the following reconciliation with cash and cash equivalents at December 31, 2010 and 2009 is provided as follows:~~

December 31,
2010 2009
Cash and bank balances and bank deposits 24,618 59,157
Less: pledged bank deposits (1,000 ) (6,000 )
Cash and cash equivalents 23,618 53,157

4. 4	Transactions with Related Parties

The Company is controlled by Firment Trading Limited (incorporated in Cyprus), which as at December 31, 2010 and 2009 owned 61.4% and 61.8% respectively of the Globus shares. The remaining percentage of the shares is widely held.

The ultimate controlling party of the Company is Mr. George ~~Feidakis.~~Feidakis who beneficially owns 4,724,475 common shares through Firment Trading Limited, a Cypriot company controlled by Mr Feidakis, and 480,000 common shares through F.G. Europe S.A. a Greek company listed on the Athens Exchange in which Mr Feidakis acts as the chairman of the Board of Directors and holds the majority of the outstanding shares. As at December 31, 2013 and 2012, Mr Feidakis beneficially owned 50.9% and 51.0%, respectively, of Globus’ shares. The remaining percentage of shares is widely held. The following are the major transactions which have been entered into with related parties during the years ended December 31, ~~2010, 2009~~2013, 2012 and ~~2008:~~

~~F-17~~

~~GLOBUS MARITIME LIMITED~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Amounts presented in thousands of U.S. Dollars - except for share and per share data, unless otherwise stated)~~

4.	~~Transactions with Related Parties (continued)~~

2011:

On August 20, 2006, Globus Shipmanagement Corp. entered into a rental agreement for 350 square ~~meters~~metres of office space for its operations within a building owned by Cyberonica S.A. (a company related through common control). Rental expense is Euro 14,578 ($20) per month up to August 20, 2015. The rental agreement provides for ~~a yearly~~an annual increase in rent of 2% above the rate of inflation as set by the Bank of Greece. The ~~contract~~rental agreement runs for 9 years and can be terminated by the Company with 6 ~~months~~months’ notice. During the years ended December 31, ~~2010, 2009~~2013, 2012 and ~~2008,~~2011, rent expense was $232, ~~$239~~$226 and ~~$242,~~$243, respectively. The expense is ~~recognized in the income statement component of the statement of comprehensive income under administrative expenses payable to related parties.~~

In November 2009, the Company entered into memoranda of agreements for the sale of m/v Sea Globe and m/v Coral Globe for an aggregate price of $34,000. North South Maritime Ltd. offered brokerage services on the aforementioned agreements. The managing director of North South Maritime Ltd. was a non-executive director of Globus’ Board of Directors. On the completion of the sale that took place in February 2010, the related party company received brokerage commission fees of 2.5% on the total sale price, which was $850. The brokerage commission was recognizedrecognised in the income statement component of the consolidated statement of comprehensive income under ~~gain/(loss) on sale~~administrative expenses payable to related parties.

In October 2011 Globus Shipmanagement Corp. hired Athanasios Feidakis a close family member of ~~vessels.~~

the Company’s ultimate controlling party. Athanasios Feidakis annual gross compensation was approximately Euro38,000 ($52). As of July 1, 2013 Athanasios Feidakis became a non-executive director of the Company. During the period and years ended June 30, 2013 and December 31, 2012 and 2011 total gross compensation of Athanasios Feidakis were $26, $48 and $10 respectively. The expense was recognised in the income statement component of the consolidated statement of comprehensive income under administrative expenses payable to related parties.

In ~~November 2010, Mr. Feidakis~~December 2013, the Company entered into a ~~business opportunities agreement with Globus. Under this agreement, Mr. Feidakis is required~~revolving credit facility for up to disclose to Globus any business opportunities relating to dry bulk shipping that may arise during his service to Globus as a member of the board of directors that could reasonably be expected to be a business opportunity that Globus may pursue.

Mr. Feidakis agreed to disclose all such opportunities, and the material facts attendant thereto, to the board of directors of Globus for consideration and if the board of directors fails to adopt a resolution regarding an opportunity within seven business days of disclosure, Globus will be deemed to have declined to pursue the opportunity, in which event Mr. Feidakis will be free to pursue it. Mr. Feidakis is also prohibited for six months after the termination of the agreement to solicit any of the Company’s senior employees or officers. Mr. Feidakis’ obligations under the business opportunities agreement will also terminate when he no longer beneficially owns Globus shares representing at least 30% of the combined voting power of all of Globus’ outstanding shares, or no longer serves as a director. Mr. Feidakis remains free to conduct his other businesses that are not related to dry bulk shipping.

In May 2007, Globus, Firment Trading Limited and Mr. George Feidakis entered into a relationship agreement, which provided that Firment Trading is entitled to appoint the chairman of our board of directors for so long as Firment Trading and Mr. Feidakis held directly or indirectly at least 30% of our outstanding shares. The agreement also provided, among other things, that Firment Trading and Mr. Feidakis would not compete with us, and contained provisions relating to related party transactions. This agreement was terminated in November 2010.

~~In November 2010, Globus entered into a registration rights agreement~~$4,000 with Firment Trading Limited, a company related through common control, for the purpose of financing its general working capital needs. The Firment Credit Facility is unsecured and ~~Kim Holdings S.A., pursuant to which it granted to them~~will remain available for 24 months until its final maturity date of December 2015, when the Company must repay all drawn and their affiliates (including Mr. George Feidakis and Globus’ chief executive officer) and certain of their transferees, the right, under certain circumstances and subject to certain restrictions to require Globus to register under the Securities Act of 1933, as amended, common shares held by them. Under the registration rights agreement, these persons haveoutstanding amounts at that time. The Company has the right to ~~request Globus~~drawdown any amount up to ~~register~~$4,000 or prepay any amount, during the ~~sale~~availability period in multiples of ~~shares held by them on their behalf and may require to make available shelf registration statements permitting sales of shares into the market from time to time over an extended period.~~$100.

F-17

~~In addition, these persons have the ability to exercise certain piggyback registration rights in connection with registered offerings requested by shareholders or initiated by Globus.~~

~~F-18~~

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. ~~Dollars -~~Dollars- except for share and per share data, unless otherwise stated)

Transactions with Related Parties (continued)

Any prepaid amount can be re-borrowed in accordance with the terms of the agreement. Interest on drawn and outstanding amounts is charged at 5% per annum and no commitment fee is charged on the amounts remaining available and undrawn. The Company drew down $2,000 in December 2013. As of December 31, 2013 the Company recognised interest expense of $3. The expense was recognised in the income statement component of the consolidated statement of comprehensive income under interest expense and finance costs.

Compensation of Key Management Personnel of the Company:

Compensation to Globus non-executive directors is ~~analyzed~~analysed as follows:

For the year ended December 31,
2010 2009 2008
Cash 124 143 158
Share based payments (note 13) 31 38 44
Total 155 181 202

	For the year ended December 31,
	2013		2012		2011
Short-term employee benefits		165		145		145
Share based payments (note 13)		50		40		41
Total		215		185		186

Compensation to the Company’s executive directors is ~~analyzed~~analysed as follows:

For the year ended December 31,
2010 2009 2008
Executive directors’ remuneration 674 849 752
Executive directors employer’s contributions 27 33 30
Share based payments (note 13) 173 307 726
Other benefits 9 8 34
Total 883 1,197 1,542

	For the year ended December 31,
	2013			2012		2011
Short-term employee benefits		197			179		752
Share based payments (note 13)		(239	)		834		205
Total		(42	)		1,013		957

Short-term employee benefits are recognised in the income statement component of the consolidated statement of comprehensive income under administrative expenses payable to related parties

Vessels, net

The amounts in the consolidated statement of financial position are ~~analyzed~~analysed as follows:

Vessel Cost Cost Accumulated Depreciation Net Book Value
Balance as of January 1, 2008 283,455 (11,449 ) 272,006
Vessel improvements 307 - 307
Vessel disposals (24,817 ) 3,319 (21,498 )
Impairment loss - (20,224 ) (20,224 )
Depreciation for the year - (17,390 ) (17,390 )
Balance at December 31, 2008 258,945 (45,744 ) 213,201
Vessel disposals (63,032 ) 14,545 (48,487 )
Impairment loss - (28,429 ) (28,429 )
Depreciation for the year - (11,172 ) (11,172 )
Vessels held for sale (42,761 ) 10,404 (32,357 )
Balance at December 31, 2009 153,152 (60,396 ) 92,756
Vessels additions, net 106,084 - 106,084
Depreciation for the year - (7,353 ) (7,353 )
Balance at December 31, 2010 259,236 (67,749 ) 191,487

~~F-19~~

~~GLOBUS MARITIME LIMITED~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Amounts presented in thousands of U.S. Dollars - except for share and per share data, unless otherwise stated)~~

5.	~~Vessels, net (continued)~~

Drydocking Cost Cost Accumulated Depreciation Net Book Value
Balance at January 1, 2008 2,880 (1,166 ) 1,714
Drydocking additions 2,823 - 2,823
Disposals (406 ) 247 (159 )
Depreciation for the year - (1,572 ) (1,572 )
Balance at December 31, 2008 5,297 (2,491 ) 2,806
Drydocking additions 1,135 - 1,135
Disposals (3,104 ) 1,758 (1,346 )
Depreciation for the year - (1,512 ) (1,512 )
Vessels held for sale (1,947 ) 1,274 (673 )
Balance at December 31, 2009 1,381 (971 ) 410
Drydocking additions 19 - 19
Depreciation for the year - (410 ) (410 )
Balance at December 31, 2010 1,400 (1,381 ) 19

Vessel net book value at December 31, 2008 264,242 (48,235 ) 216,007
Vessel net book value at December 31, 2009 154,533 (61,367 ) 93,166
Vessel net book value at December 31, 2010 260,636 (69,130 ) 191,506

	Vessel cost			Vessel depreciation			Dry docking costs			Depreciation of dry docking costs			Fair value of time charter attached		Amortization of fair value of time charter attached			Net Book Value
Balance as of January 1, 2011		259,236			(67,749	)		1,400			(1,381	)		-		-			191,506
Additions		56,574			-			1,035			-			4,650		-			62,259
Depreciation & Amortization		-			(10,161	)		-			(318	)		-		(779	)		(11,258	)
Balance at December 31, 2011		315,810			(77,910	)		2,435			(1,699	)		4,650		(779	)		242,507
Additions/Vessel improvements		345			-			941			-			-		-			1,286
Impairment loss		(80,244	)		-			-			-			-		-			(80,244	)
Vessels classified as held for sale		(8,784	)		-			(92	)		-			-		-			(8,876	)
Depreciation & Amortization		-			(11,227	)		-			(763	)		-		(1,823	)		(13,813	)
Balance at December 31, 2012		227,127			(89,137	)		3,284			(2,462	)		4,650		(2,602	)		140,860
Depreciation & Amortization		-			(5,588	)		-			(434	)		-		(1,261	)		(7,283	)
Balance at December 31, 2013		227,127			(94,725	)		3,284			(2,896	)		4,650		(3,863	)		133,577

For the purpose of the consolidated statement of comprehensive income, depreciation, as ~~statement~~stated in the income statement component, comprises the following:

For the year ended December 31,
2010 2009 2008
Depreciation on vessel cost 7,353 11,172 17,390
Depreciation on office furniture and equipment 14 32 17
Total 7,367 11,204 17,407

~~During the year ended~~

	For the year ended December 31,
	2013		2012		2011
Depreciation on vessel cost		5,588		11,227		10,161
Depreciation on office furniture and equipment		34		28		19
Total		5,622		11,255		10,180

Pursuant to a board of director’s resolutionon December ~~31, 2010,~~4, 2012, the Company ~~acquired~~decided to actively market for sale the vessel m/v ~~Star Globe and m/v Sky Globe for a purchase price of $32,825 each and m/v Jin Star (with a bareboat time charter attached) for a purchase price of $41,112.~~

~~During~~Tiara Globe. The Company considered that the ~~year ended December 31, 2009,~~vessel met the Company sold and delivered to their new owners the vessels, m/v Island Globe, m/v Gulf Globe and m/v Lake Globe for a selling price of $19,100, $15,500 and $16,500, respectively. These vessels were measured at the lower of carrying amount and fair value less costs to sell, since the conditionscriteria described in note 2.29 ~~were satisfied. In this respect, the Company recognized an impairment loss of $22,325.~~

During November 2009, the Company entered into memoranda of agreement for the sale of m/v Sea Globe and m/v Coral Globe for a selling price of $17,500 and $16,500, respectively. The conditions described in Note 2.29 were satisfied and the vessels wereto be classified as held for sale and measured at the lower of ~~their~~its carrying amount and fair value less ~~costs~~cost to sell.

F-18

The Company recognized an impairment loss of $6,104. At December 31, 2009 these vessels were shown in the consolidated statement of financial position as ‘non-current assets classified as held for sale’ and amounted to $33,030. Both vessels were delivered to their new owners in February 2010.

~~F-20~~

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. ~~Dollars -~~Dollars- except for share and per share data, unless otherwise stated)

Vessels, net (continued)

~~During~~

In this respect, the ~~year ended~~Company recognized an impairment loss of $24,443 at that time. By a board of directors’ resolutionon November 20, 2013, the Company decided to continue to actively market for sale the vessel m/v Tiara Globe and extend the period that the vessel is classified as held for sale beyond a financial year. As of December 31, ~~2008,~~2013 the ~~Group sold the m/v Ocean Globe for a selling price of $37,000. The~~ vessel was ~~delivered~~measured at fair value of $11,767, less estimated cost to sell of $401, less deferred dry docking costs of $811 resulting in an impairment gain of $1,679 when compared to the fair value less cost to sell as of December 31, 2012 of $8,876. As of December 31, 2013 the Company performed an assessment on ~~November 12, 2008.~~

~~The Company’s vessels have been pledged as collateral to secure the bank loans discussed in note 12.~~

~~The Company assesses at each reporting date~~ whether there is an indication that ~~its vessels~~a vessel may be impaired. The vessels’ recoverable amount is estimated when events or changes in circumstances indicate the carrying value may not be recoverable. If such indication exists and where the carrying value exceeds the estimated recoverable amounts, the vessel is written down to its recoverable amount. The recoverable amount is the greater of fair value less costs to sell and value-in-use. In assessing value-in-use, the estimated future cash flows are discounted to their present value using a discount rate that reflects current market assessments of the time value of money and the risks specific to the vessel. Impairment losses are recognized in the consolidated statement of comprehensive income. Discounted future cash flows for each vessel were determined and compared to the vessel’s carrying value. The projected net discounted future cash flows were determined by considering an estimate daily time charter equivalent (based on the most recent blended (for modern and older vessels) average historical one-year time charter ~~rates~~rate available for each type of vessel) assuming an annual growth rate as published by the International Monetary Fund, over the remaining estimated life of each vessel, net of brokerage commissions, expected outflows for scheduled vessels maintenance and vessel operating expenses assuming an average annual inflation rate of approximately 4%. ~~Historical~~In the impairment test exercise conducted at year end we used historical ten-year blended average one-year time charter rates ~~used in~~substituting for the ~~impairment test exercise~~years 2007 and 2008 that were considered as extreme values, with the years 2002 and 2003. The average time charter rates used were in line with the overall chartering strategy, especially in periods/years of depressed charter rates; reflecting the full operating history of vessels of the same type and particulars with the Company’s operating fleet (Supramax and Panamax vessels with a ~~dwt~~deadweight (“dwt”) of over 50,000 and 70,000, respectively) and they covered at least one full business cycle. The average annual inflation rate applied on vessels’ maintenance and operating costs approximated current projections for global inflation rate for the remaining useful life of the Company’s vessels. Effective fleet utilization was assumed at ~~92%~~90% (including ballast days), taking into account the period(s) each vessel is expected to undergo her scheduled maintenance ~~(drydocking~~(dry-docking and special surveys), as well as an estimate of the period(s) needed for finding suitable employment and off-hire for reasons other than scheduled maintenance, assumptions in line with the Company’s expectations for future fleet utilization under the current fleet deployment strategy. ~~During the year ended~~As of December 31, ~~2008,~~2013, no impairment loss was recognized as the vessels’ recoverable amounts exceeded their carrying amounts. As of December 31, 2012, the Company concluded that the recoverable amount ~~for two~~ of the following vessels, ~~namely, the~~excluding m/v Tiara ~~Globe and m/v River~~ Globe, was lower than their carrying ~~values. Subsequently, the Company~~amounts and recognized an impairment loss of ~~$20,224 in 2008. As of~~$55,801.

	Impairment gain/(loss)
	For the year ended December 31,
Vessels	2013		2012			2011
m/v Tiara Globe (vessel classified as held for sale)		1,679		(24,443	)		-
m/v River Globe		-		(23,978	)		-
m/v Star Globe		-		(7,439	)		-
m/v Sky Globe		-		(6,820	)		-
m/v Jin Star		-		(7,921	)		-
m/v Sun Globe		-		(2,902	)		-
m/v Moon Globe		-		(6,741	)		-
Total		1,679		(80,244	)		-

During the year ended December 31, ~~2010~~2011, the Company acquired m/v Moon Globe for a purchase price of $31,400 and ~~2009, none~~m/v Sun Globe for a purchase price of $30,300. Both vessels were acquired subject to time charters with favourable terms relative to the market. The Company estimated, as of the date of acquisition, the amount included in the cost of the aforementioned ~~assumptions have changed significantly, however, no impairment losses were recognized as~~vessels that was attributable to the ~~value in use for all the vessels~~favourable terms of the ~~fleet exceeded their~~time charters, relative to market terms to be $2,150 for m/v Moon Globe and $2,500 for m/v Sun Globe. These amounts are amortized on a straight line basis over the remaining term of the respective ~~carrying values.~~

time charters which is June 2013, for m/v Moon Globe and January 2015, for m/v Sun Globe. Amortization for the year is included in the income statement component of the consolidated statement of comprehensive income under amortization of fair value of time charter attached to vessels. The Company estimated, as of the date of acquisition of the vessels’ an aggregate amount of $300 for m/v Moon Globe and $250 for m/v Sun Globe, representing the component of the cost of the purchase price of the vessel that relates to regular major inspections. These amounts were included in dry-docking costs. The Company’s vessels have been pledged as collateral to secure the bank loans discussed in note 12.

Inventories

Inventories in the consolidated statement of financial position are ~~analyzed~~analysed as follows:

December 31,
2010 2009
Lubricants (at cost) 417 314
Gas cylinders (at cost) 50 41
Total 467 355

~~F-21~~

	December 31,
	2013		2012
Lubricants (at cost)		580		594
Gas cylinders (at cost)		53		64
Total		633		658

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. ~~Dollars -~~Dollars- except for share and per share data, unless
otherwise stated)

Prepayments and other assets

Prepayments and other assets in the consolidated statement of financial position are ~~analyzed~~analysed as follows:

December 31,
2010 2009
Insurance claims 46 26
Interest receivable 1 106
Bunkers 1,169 1,155
Other prepayments 314 201
Total 1,530 1,488

	December 31,
	2013		2012
Insurance claims		-		225
Interest receivable		1		2
Bunkers		2,889		2,141
Other prepayments and other assets		331		473
Total		3,221		2,841

Trade accounts payable

Trade accounts payable in the consolidated statement of financial position as at December 31, ~~2010~~2013 and ~~2009,~~2012, amounted to ~~$1,346~~$2,097 and ~~$1,158,~~$1,720, respectively. Trade accounts payable are non-interest bearing and are normally settled on 60-day terms.

Accrued liabilities and other payables

Accrued liabilities and other payables in the consolidated statement of financial position are ~~analyzed~~analysed as follows:

December 31,
2010 2009
Accrued interest 149 161
Accrued audit fees 72 80
Other accruals 389 739
Other payables 88 115
Total 698 1,095

	December 31,
	2013		2012
Accrued interest		37		118
Accrued audit fees		95		93
Other accruals		808		687
Insurance deductibles		128		117
Dividend payable on Preferred Shares (note 17)		167		-
Other payables		182		84
Total		1,417		1,099

Interest is normally settled quarterly throughout the year.

Other payables are non-interest bearing and are normally settled on monthly terms.

~~10.~~

Share Capital and Share Premium

The authorised share capital of Globus consisted of the following:

December 31,
2010 2009 2008
Authorized share capital:
100,000,000 Common Shares of par value $0.001 each - 100 100
500,000,000 Common Shares of par value $0.004 each 2,000 - -
100,000,000 Class B common shares of par value $0.001 each 100 - -
100,000,000 Preferred shares of par value $0.001 each 100 - -
Total authorized share capital 2,200 100 100

~~F-22~~

	December 31,
	2013		2012		2011
Authorised share capital:
500,000,000 Common Shares of par value $0.004 each		2,000		2,000		2,000
100,000,000 Class B common shares of par value $0.001 each		100		100		100
100,000,000 Preferred shares of par value $0.001 each		100		100		100
Total authorised share capital		2,200		2,200		2,200

Holders of the Company’s common shares and Class B shares have equivalent economic rights, but holders of Company’s common shares are entitled to one vote per share and holders of the Company’s Class B shares are entitled to twenty votes per share. Each holder of Class B shares may convert, at its option, any or all of the Class B shares held by such holder into an equal number of common shares.

Common Shares issued and fully paid	Number of shares		USD
At January 1, 2011		7,289,688		29,159
Issued during the year – follow-on public offering		2,750,000		11,000
Issued during the year (share based compensation note 13)		60,789		243
At December 31, 2011		10,100,477		40,402
Issued during the year (share based compensation note 13)		107,040		428
At December 31, 2012		10,207,517		40,830
Issued during the year (share based compensation note 13)		19,841		79
At December 31, 2013		10,227,358		40,909

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. ~~Dollars -~~Dollars- except for share and per share data, unless
otherwise stated)

~~10.~~

Share Capital and Share Premium (continued)

Common shares issued and fully paid
Number of
shares pre-
reverse split

Number of
shares
USD
At January 1, 2008 28,636,153 7,159,039 28,636
Issued during the year (share based compensation note 13) 29,297 7,324 29
At December 31, 2008 28,665,450 7,166,363 28,665
Issued during the year (share based compensation note 13) 290,722 72,680 291
At December 31, 2009 28,956,172 7,239,043 28,956
Issued during the year (share based compensation note 13) 202,580 50,645 203
At December 31, 2010 29,158,752 7,289,688 29,159

~~At the annual general shareholders meeting that took place on July 28, 2010, the shareholders of~~

On June 30, 2011 Globus ~~approved a reverse split of four ordinary shares of $0.001 each,~~completed its first follow-on public offering in the ~~capital~~United States under the Securities Act of ~~Globus into one ordinary share of $0.004 each. Such reverse split occurred on July 29, 2010. As a consequence, authorized~~1933, as amended, and issued 2,750,000 common shares ~~after~~ the ~~reverse split~~net proceeds of which amounted to ~~25,000,000~~$20,048 (gross proceeds of ~~$0.004 each~~

~~At the annual general shareholders meeting that took place on July 28, 2010, the shareholders~~$22,000 less transaction costs of Globus approved the transfer of Globus’ place of domicile to the Marshall Islands and the filing of its new articles of incorporation in the Marshall Islands. On November 24, 2010, upon the redomiciliation into the Marshall Islands, Globus’ authorized share capital amounted to 700,000,000 shares analyzed as follows: (i) 500,000,000 common shares of par value $0.004 each, (ii) 100,000,000 class B common shares of par value $0.001 each and (iii) 100,000,000 preferred shares of par value $0.001 each.

$1,952).

During the years ended December 31, ~~2010, 2009~~2013, 2012 and ~~2008,~~2011, Globus issued ~~50,645, 72,680~~19,841, 107,040 and ~~7,324~~60,789 common shares ~~(202,580, 290,722 and 29,297 pre-reverse split equivalent)~~ respectively as share based payments (note 13).

Series A Preferred Shares issued	Number of shares			USD
At January 1, 2012		-			-
Issued during the year (share based compensation note 13)		3,347			3
At December 31, 2012		3,347			3
Shares redeemed by the issuer		(780	)		(1	)
At December 31, 2013		2,567			2

By a board of directors resolution dated April 20, 2012, 3,347 series A preferred shares were issued to Company’s two executive officers as share based payment (note 13).

The holders of Company’s series A preferred shares are entitled to receive, if funds are legally available, dividends payable in cash in an amount per share to be determined by unanimous resolution of Company’s Remuneration Committee, in its sole discretion. Company’s board of directors or Remuneration Committee will determine whether funds are legally available under the Marshall Islands Business Corporations Act (“BCA”) for such dividend. Any accrued but unpaid dividends will not bear interest. Except as may be provided in the BCA, holders of our series A preferred shares do not have any voting rights. Upon our liquidation, dissolution or winding up, the holders of our series A preferred shares will be entitled to a preference in the amount of the declared and unpaid dividends, if any, as of the date of liquidation, dissolution or winding up. Our series A preferred shares are not convertible into any of our other capital stock.

On January 8, 2013 the Company’s Chief Financial Officer stepped down from his position. Upon his resignation 780 preferred shares of series A, granted to him on April 20, 2012 were redeemed.

As of December 31, ~~2010,~~2013, 2012 and 2011 no Class B shares ~~or preferred shares have been~~were issued.

Share premium includes the contribution of ~~the Company’s~~Globus’ shareholders to the acquisition of the Company’s vessels. Additionally, share premium includes the effects of the acquisition of non-controlling interest, the effects of the ~~Globus’~~Globus initial and follow-on public ~~offering~~offerings and the effects of the share based payments described in note 13. Accordingly at December 31, ~~2010, 2009~~2013, 2012 and ~~2008, Globus’~~2011, Globus share premium amounted to ~~$88,817, $88,516~~$109,803, $109,753 and ~~$87,600,~~$109,229, respectively.

~~11.~~

Earnings/(loss) per Share

Basic earnings/(loss) per share (“EPS”/~~”LPS”~~ ‘‘LPS’’) is calculated by dividing the net profit/(loss) for the year attributable to ~~Globus’~~Globus shareholders by the weighted average number of shares issued, paid and outstanding.

Diluted earnings/(loss) per share is calculated by dividing the net profit/(loss) attributable to common equity holders of the parent by the weighted average shares outstanding during the year plus the weighted average number of common shares that would be issued on the conversion of all the dilutive potential common shares into common shares.

~~F-23~~

~~GLOBUS MARITIME LIMITED~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Amounts presented in thousands of U.S. Dollars - except for share and per share data, unless otherwise stated)~~

~~11.~~

~~Earnings/(loss) per Share (continued)~~

The following reflects the ~~profit/~~(loss)/ earnings and share data used in the basic and diluted ~~earnings~~loss per share computations:

For the year ended December 31,
2010 2009 2008
Net profit/(loss) attributable to common equity holders 6,003 (10,079 ) 42,818
Weighted average number of shares for basic EPS 7,243,340 7,192,369 7,162,564
Effect of dilution:
Effect of shares awarded treated as options “LTIP” (note 13) 96,881 - 64,203
Weighted average number of shares adjusted for the effect of dilution 7,340,221 7,192,369 7,226,767

	For the year ended December 31,
	2013			2012			2011
Net profit/(loss) for the year		5,677			(82,804	)		6,925
Less: Dividends on preferred shares (note 17)		(330	)		(526	)		-
Net profit/(loss) attributable to common equity holders		5,347			(83,330	)		6,925
Weighted average number of shares for basic EPS		10,215,997			10,142,979			8,688,543
Effect of dilution:
Effect of shares awarded treated as options “LTIP” (note 13)		-			-			49,901
Weighted average number of shares adjusted for the effect of dilution		10,215,997			10,142,979			8,738,444

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. Dollars- except for share and per share data, unless
otherwise stated)

~~12.~~

Long-Term Debt, net

Long-term debt in the consolidated statement of financial position is ~~analyzed~~analysed as follows:

Borrower Loan Balance
Unamortized Debt
Discount
Total Borrowings
(a) Globus Maritime Limited 71,000 (230 ) 70,770
(b) Kelty Marine Ltd. 25,650 (182 ) 25,468

Total at December 31, 2010 96,650 (412 ) 96,238
Less: Current Portion 11,000 (94 ) 10,906
Long-Term Portion 85,650 (318 ) 85,332

Total at December 31, 2009 70,562 (487 ) 70,075
Less: Current Portion 34,157 (257 ) 33,900
Long-Term Portion 36,405 (230 ) 36,175

	Borrower	Loan Balance		Unamortized Debt Discount			Total Borrowings
(a)	Globus Maritime Limited		44,000		(70	)		43,930
(b)	Kelty Marine Ltd.		17,650		(86	)		17,564
(c)	Artful Shipholding S.A. & Longevity Maritime Limited		27,854		(138	)		27,716
(d)	Shareholder’s loan		2,000		-			2,000

	Total at December 31, 2013		91,504		(294	)		91,210
	Less: Portion associated with vessel classified as held for sale		6,150		-			6,150
	Less: Current Portion		12,425		(102	)		12,323
	Long-Term Portion		72,929		(192	)		72,737

	Total at December 31, 2012		105,929		(410	)		105,519
	Less: Portion associated with vessel classified as held for sale		6,710		-			6,710
	Less: Current Portion		20,190		(116	)		20,074
	Long-Term Portion		79,029		(294	)		78,735

(a)

In November 2007, ~~Globus~~the Company entered into a secured reducing revolving credit facility for $120,000 with a bank for the purpose of financing vessel acquisitions as well as for working capital purposes. The facility is in ~~order to: (i) refinance~~ the ~~then existing indebtedness on m/v Island Globe, (ii) finance part~~name of Globus Maritime Limited as borrower and is guaranteed by the ~~purchase price~~vessel owning subsidiaries of m/v Tiara Globe, ~~and~~ m/v River Globe, m/v Star Globe and ~~(iii)~~m/v Sky Globe collateralized by first preferred mortgages over their vessels. This reducing revolving credit facility bears interest at LIBOR plus a margin of 0.95% per annum if the market values of the mortgaged vessels are less than 200% of the outstanding loan balance and 0.75% per annum if the market values of the mortgaged vessels are more than 200% of the outstanding loan balance. The balance outstanding as of December 31, 2013 was $44,000 payable in 4 semi-annual installments, of $4,500 starting May 2014, as well as a balloon payment of $26,000 due together with the 4th and final installment due in November 2015. As of December 31, 2013 there was no amount available to ~~provide general working capital to~~be drawn under the ~~Company.~~revolving credit facility.

~~The $120,000 facility is in~~

On December 4, 2012, the ~~name of Globus Maritime Limited as borrower and, at~~Company decided to actively market for sale the ~~time of execution, was guaranteed by the vessel-owning subsidiaries of m/v Island Globe,~~vessel m/v Tiara Globe and considered that the vessel met the criteria to be classified as held for sale. By a board of directors’ resolution on November 20, 2013, the Company decided to continue to actively market for sale the vessel m/v ~~River~~Tiara Globe ~~collateralized by first preferred mortgages over their vessels.~~

~~This reducing revolving credit facility bears interest at LIBOR plus~~and extend the period that the vessel is classified as held for sale beyond a ~~margin of 0.95% per annum if the market values~~financial year. The portion of the mortgaged vessels are less than 200% of the outstanding loan balance and 0.75% per annum if the market values of the mortgaged vessels are more than 200% of the outstanding loan balance. On September 2, 2009, following the sale of m/v Island Globe, an amount of $18,500 was repaid. During May 2010, following the acquisition of m/v Star Globe and m/v Sky Globe, an amount of $35,520 was drawn down. The balance outstanding as of December 31, 2010 was $71,000 payable in 10 equal semi-annual installments of $4,500 starting May 2011, as well as a balloon payment of $26,000 due togetherlong-term debt associated with the ~~10th~~vessel classified as held for sale amounts to $6,150 (2012: $6,710) and ~~final installment due~~is classified as current liability included in ~~November 2015.~~

~~Following~~ the ~~sale~~consolidated statement of ~~m/v Island Globe in September 2009 and the acquisition of m/v Star Globe and m/v Sky Globe in May 2010, the~~financial position under long-term borrowings associated with vessel classified as held for sale.

The loan is secured as follows:

~~F-24~~

~~GLOBUS MARITIME LIMITED~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Amounts presented in thousands of U.S. Dollars - except for share and per share data, unless otherwise stated)~~

~~12.~~

~~Long-Term Debt, net (continued)~~

First preferred mortgage over: m/v Tiara Globe, m/v River Globe, m/v Star Globe and m/v Sky Globe.

Guarantees from the owning companies of these vessels.

First preferred assignment of all insurances and earnings of the mortgaged vessels.

General pledge of earnings account or any other accounts to be held with the lender.

The credit facility contains various covenants ~~including, amongst others, restrictions (a) that prohibit changes~~requiring us among other things to ensure that:

the aggregate market value of the mortgaged vessels at all times is or exceeds 133% of the outstanding balance under the facility, minus the aggregate amount, if any, standing to the credit of Company’s operating accounts or any bank accounts opened with the lender, which are subject to an encumbrance in favor of the lender and designated as a “security account” by the lender for purposes of the credit facility;

the ratio of Company’s consolidated market adjusted net worth to Company’s total assets will not be less than 35%;

Globus maintain consolidated cash and cash equivalents, including any undrawn commitments so long as such undrawn amount would not trigger an event of default not less than the greater of (1) $10.0 million; and (2) the sum determined by the bank to be the aggregate of the total principal amount of all borrowed money and interest accruing thereon, payable by the Company and which falls due in the six-month period commencing on any relevant day;

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in ~~management~~thousands of U.S. Dollars- except for share and ~~ownership~~per share data, unless
otherwise stated)

Long-Term Debt, net (continued)

Mr. Feidakis maintains at least 35% of Company’s total issued voting share capital; and

Globus will be permitted to pay dividends on its common shares in respect of any of our financial quarters so long as Globus is not in default on the credit facility at the time of the declaration or payment of the dividends and nor would a default occur as a result of the declaration or payment of such dividend.

During December 2012, Globus reached an agreement with the lender on certain amendments and waivers to the terms of the mortgaged vessel without prior written consent of the lender, (b) that prohibit the incurrence of additional indebtedness other than in the normal course of business without the prior written consent of the lender, (c) relating to mortgaging the vessel, (d) that prohibit payment of dividends that exceed 75% of the net income recordedcredit facility signed on March 26^th 2013, valid for the ~~preceding financial year without~~ period from December 28, 2012 to March 31, 2014 (“the bank’s prior consent, (e) that set forth minimum requirements for the vessels’ market value and insured value in relation to the loan’s outstanding balance and (f) that set forth the requirement to maintain at the end of each accounting period and all other times during the security period, cash and bank balances and bank deposits of at least $10,000.

waiver period”) as listed below:

~~(b)~~Ø

the aggregate market value of the mortgaged vessels at all times is or exceeds 110% of the outstanding balance under the facility, minus the aggregate amount, if any, standing to the credit of the Company’s operating accounts or any bank accounts opened with the lender, which are subject to an encumbrance in favor of the lender and designated as a “security account” by the lender for purposes of the credit facility.

fully waive during the waiver period the requirement that the ratio of the Company’s consolidated market adjusted net worth to its total assets not being less than 35%.

Globus to maintain consolidated cash and cash equivalents, to be not less than the greater of (1) $5.0 million; and (2) the sum determined by the bank to be the aggregate of the total principal amount of all borrowed money and interest accruing thereon, payable by the Company and which falls due in the six-month period commencing on any relevant day.

Globus is not permitted to pay dividends on its common shares during the waiver period.

During the waiver period the facility to bear interest at LIBOR plus a margin of 2.10%.

As of December 31, 2013, Globus was in compliance with the amended loan covenants.

(b)

In June 2010, Kelty Marine ~~Ltd.~~Ltd entered into a ~~$26,650~~ loan agreement for $26,650 with a bank ~~to partially finance~~for the purpose of part financing the acquisition of m/v Jin Star. The loan facility is in the name of Kelty Marine ~~Ltd.~~Ltd as the borrower and is guaranteed by Globus ~~Maritime Limited~~ (“Guarantor”). The loan facility bears interest at LIBOR plus a margin of 2.25% if the ratio of the outstanding loan to the market value of m/v Jin Star and any additional security provided at the time being, plus any amount of minimum free liquidity maintained with the bank (Loan to Value ratio, “LtV”) is less than 45%, a margin of 2.40% if the LtV is equal to or exceeds 45% but is less than or equal to 60%, a margin of 2.50% if the LtV exceeds 60% but is less than or equal to 70% and a margin of 2.75% if the LtV exceeds 70%. The balance outstanding at December 31, ~~2010~~2013, was $ ~~25,650~~17,650 payable in 2610 equal quarterly ~~installments~~instalments of $500 starting March ~~2011,~~2015, as well as a balloon payment of $12,650 due together with the ~~26th~~10th and final installment due in June 2017.

The loan is secured as follows:

First preferred mortgage over m/v Jin Star.

Guarantees from the vessel owning company and from ~~Globus Maritime Limited.~~Globus.

First preferred assignment of all insurances and earnings of the mortgaged vessel as well as of the bareboat charter agreement attached to the vessel.

The loan agreement contains various covenants requiring Kelty Marine ~~Ltd.~~Ltd to, amongst others things, ensure that ~~(a) Kelty Marine Ltd.~~

Kelty Marine Ltd does not undergo a change of control.

the ratio of the Company’s shareholders’ equity to total assets is not less than 25%.

the Guarantor must have a minimum equity of $50 million.

the market value of each vessel and any additional security provided, including the minimum liquidity of $1,000 with the bank, is or exceeds 130% of the loan balance outstanding.

the Borrower and or the Guarantor to maintain at the end of each accounting period and all other times during the security period, cash and bank balances and bank deposits of at least $1,000 with the bank.

As of December 31, 2012, the Company was not ~~undergo a change of control, (b)~~in compliance with the ~~ratio~~security value requirement that requires the market value of the ~~Company’s shareholders’ equity~~m/v Jin Star and any additional security provided, including the minimum liquidity with the lender, to ~~total assets is not less~~be equal or greater than ~~25% (c)~~130% of the ~~Guarantor must~~aggregate principal amount of debt outstanding under the loan agreement. In such circumstances upon request from the lender, the Company have to either provide the lender acceptable additional security with a ~~minimum equity of $50 million (d) it maintains minimum requirements for the vessel’s market~~net realizable value ~~in relation~~at least equal to the ~~loan’s outstanding balance and (e) Kelty Marine Ltd. and/~~shortfall, or prepay an amount that will eliminate the ~~Guarantor maintain at the end of each accounting period and all other times during the security period, cash and bank balances and bank deposits of at least $1,000.~~

~~(c)~~

In March 2008, the Company entered into a credit facility of up to $85,000 with a bank in order to: (i) refinance the existing indebtedness on m/v Coral Globe, m/v Gulf Globe, m/v Lake Globe, m/v Ocean Globe, and m/v Sea Globe and (ii) to provide general working capital to the Company. The balance outstanding as of December 31, 2009, was $27,007 and was fully repaid during February 2010 following the sale of m/v Sea Globe and m/v Coral Globe.

~~F-25~~

shortfall, which amounted to $5,765.

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. ~~Dollars -~~Dollars- except for share and per share data, unless
otherwise stated)

~~12.~~

Long-Term Debt, net (continued)

The amount was classified in the consolidated statement of financial position under current portion of long term borrowings. On April 29, 2013, the Company reached an agreement with the lender to prepay $3,000 for the company to be fully compliant with the provisions of the loan agreement. The amount was paid on June 28, 2013.

As of December 31, 2013, Globus was in compliance with the loan covenants.

(c)

In June 2011, Artful Shipholding S.A. and Longevity Maritime Limited entered into a loan agreement for up to $40,000 with a bank for the purpose of part financing the acquisition of m/v Moon Globe and m/v Sun Globe. The loan facility is in the names of Artful Shipholding S.A. and Longevity Maritime Limited as the borrowers and is guaranteed by Globus (“Guarantor”). The loan facility bears interest at LIBOR plus a margin of 2.5%.

On June 22, 2011, Artful Shipholding S.A. drew down $19,000 (“tranche” (A)), for the purpose of part financing the acquisition of m/v Moon Globe. The balance outstanding of tranche (A) at December 31, 2013, was $14,100 payable in 20 equal quarterly installments of $440 starting, March 2014, as well as a balloon payment of $5,300 due together with the 20th and final installment due in December 2018.

On September 14, 2011, Longevity Maritime Limited drew down $18,000 (“tranche” (B)) for the purpose of part financing the acquisition of m/v Sun Globe. The balance outstanding of tranche (B) at December 31, 2013, was $13,754 payable in 21 equal quarterly installments of $416 starting March 2014, as well as a balloon payment of $5,013 due together with the 21st and final installment due in March 2019.

The loan is secured as follows:

First preferred mortgage over m/v Moon Globe and m/v Sun Globe.

Guarantees from the vessel owning companies and from Globus Maritime Limited.

First preferred assignment of all insurances and earnings of the mortgaged vessels.

The loan agreement contains various covenants requiring the vessels owning companies to, amongst others things, ensure that

the aggregate fair market value of the m/v Sun Globe and the m/v Moon Globe must equal or exceed 120% of the outstanding balance under the loan agreement less any cash up to $1,000 held in the operating accounts pledged to the lender during the first two years and 130% thereafter.

the ratio of the Company’s market adjusted net worth to total assets must be greater than 35%.

the company maintain a minimum market adjusted net worth of more than $50,000.

the vessel owning subsidiaries must each maintain a minimum liquidity of $500 in an account pledged to the Bank, and

a minimum liquidity of the lesser of $10,000 and $1,000 per vessel owned by the Company.

During December 2012, Globus reached an agreement with the lender on certain amendments and waivers to the terms of the loan agreement signed on April 10, 2013 valid for the period from December 31, 2012 to March 31, 2014 (“the waiver period”) as listed below:

the aggregate fair market value of the m/v Sun Globe and the m/v Moon Globe must equal or exceed 107% of the outstanding balance under the loan agreement less any cash up to $1,000 held in the operating accounts pledged to the lender.

a quarterly cash sweep mechanism with effect from April 12, 2013 will be implemented on all vessels mortgaged under this loan agreement on an individual vessel basis until the security value exceeds 130% of the loan outstanding. Under this mechanism all earnings of these vessels after operating expenses, dry docking provision, general and administrative expenses and debt service, if any, are to be used as applied to the balloon payment of the relevant tranche.

the company to maintain a minimum market adjusted net worth of more than $20,000.

The Company to maintain minimum liquidity of $5,000.

the ratio of the Company’s market adjusted net worth to total assets must be greater than 15%.

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. Dollars- except for share and per share data, unless

otherwise stated)

Long-Term Debt, net (continued)

The above amendments were subject to $1,000 prepayment, paid on April 9, 2013, which was classified in the consolidated statement of financial position as of December 31, 2012 under current portion of long-term debt, as upon the execution of the supplemental agreement to be applied to the balloon.

As of December 31, 2013 Globus was in compliance with the amended loan covenants.

(d)

In December 2013, the Company entered into a revolving credit facility for up to $4,000 with Firment Trading Limited, a company related through common control, for the purpose of financing its general working capital needs. The Firment Credit Facility is unsecured and will remain available for 24 months until its final maturity date of December 2015, when the Company must repay all drawn and outstanding amounts at that time. The Company has the right to drawdown any amount up to $4,000 or prepay any amount, during the availability period in multiples of $100. Any prepaid amount can be re-borrowed in accordance with the terms of the agreement. Interest on drawn and outstanding amounts is charged at 5% per annum and no commitment fee is charged on the amounts remaining available and undrawn. The Company drew down $2,000 in December 2013. (note 4)

The contractual annual loan principal payments per bank loan to be made subsequent to December 31, ~~2010~~2013 are as follows:

Bank Loan
December 31

(a)

(b)

Total

2011 9,000 2,000 11,000
2012 9,000 2,000 11,000
2013 9,000 2,000 11,000
2014 9,000 2,000 11,000
2015 35,000 2,000 37,000
2016 and thereafter - 15,650 15,650
Total 71,000 25,650 96,650

	(a)		(b)		(c)				(d)
									Shareholders		Total
December 31					Tranche (A)		Tranche (B)		Loan
2014		9,000		-		1,760		1,665		-		12,425
2015		35,000		2,000		1,760		1,665		2,000		42,425
2016		-		2,000		1,760		1,665		-		5,425
2017		-		13,650		1,760		1,665		-		17,075
2018 and thereafter		-		-		7,060		7,094		-		14,154
Total		44,000		17,650		14,100		13,754		2,000		91,504

The contractual annual loan principal payments per bank loan to be made subsequent to December 31, ~~2009,~~2012 were as follows:

Bank Loan
December 31

(a)

(c)

Total

2010 7,150 3,510 10,660
2011 7,150 3,510 10,660
2012 7,150 3,510 10,660
2013 7,150 3,510 10,660
2014 7,150 3,510 10,660
2015 and thereafter 7,805 9,457 17,262
Total 43,555 27,007 70,562

~~13.~~

~~Share Based Payment~~

~~Share based payment comprise~~

	(a)		(b)		(c)
December 31					Tranche (A)		Tranche (B)		Total
2013		8,000		7,765		2,260		2,165		20,190
2014		9,000		2,000		1,760		1,665		14,425
2015		35,000		2,000		1,760		1,665		40,425
2016		-		2,000		1,760		1,665		5,425
2017		-		7,885		1,760		1,665		11,310
2018 and thereafter		-		-		7,060		7,094		14,154
Total		52,000		21,650		16,360		15,919		105,929

The weighted average interest rate for the ~~following:~~

For the year ended December 31, 2010

Common Shares
pre-reverse split
Common shares
Share
premium

Retained
earnings

Non executive directors payment (note 4) 11,288 2,822 22 9
“LTIP” shares issued 191,292 47,823 279 (17 )
“LTIP” accrued current year - - - 17
“LTIP” portion forfeited - - - 1
Total 202,580 50,645 301 10

~~F-26~~

years ended December 31, 2013, 2012 and 2011 was 2.54%, 2.12% and 1.69%, respectively.

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. ~~Dollars -~~Dollars- except for share and per share data, unless
otherwise stated)

~~13.~~

Share Based Payment

Share ~~Based Payment (continued)~~

For the year ended December 31, 2009

Common Shares
pre-reverse split
Common shares
Share
premium

Retained
earnings

Non executive directors payment (note 4) 33,910 8,477 38 -
Extra payment 171,052 42,763 175 -
“LTIP” shares issued 85,760 21,440 703 (581 )
“LTIP” accrued current year - - - 17
“LTIP” portion cancelled - - - 1,402
Total 290,722 72,680 916 838

For the year ended December 31, 2008

Common Shares
pre-reverse split
Common shares
Share
premium

Retained
earnings

Non executive directors payment (note 4) 12,400 3,100 44 -
Extra payment 16,897 4,224 145 -
“LTIP” accrued current year - - - 581
Total 29,297 7,324 189 581

based payment comprise the following:

	Common shares		Preferred shares			Share premium		Retained earnings
Year 2013
Non-executive directors payment		19,841		-			50		-
Preferred shares redeemed		-		(780	)		-		-
“2012 LTIP” reversed		-		-			-		(239	)
Balance at December 31, 2013		19,841		(780	)		50		(239	)

Year 2012	Common shares		Preferred shares		Share premium		Retained earnings
Non-executive directors payment		15,780		-		40		-
Share bonus to executive directors		39,128		-		181		-
Series A Preferred shares issued		-		3,347		-		230
“2009 LTIP” shares issued		52,132		-		303		(17	)
“2012 LTIP” accrued current year		-		-		-		239
Balance at December 31, 2012		107,040		3,347		524		452

Year 2011
Non-executive directors payment		7,800		-		51		(10	)
“2009 LTIP” shares issued		52,989		-		324		(17	)
“2009 LTIP” accrued current year		-		-		-		16
Balance at December 31, 2011		60,789		-		375		(11	)

For the year ended December 31, ~~2010:~~

2013:

Non-executive director’s payments:

Refers to the common shares issued or accrued during the year to our non-executive directors pursuant to their letters of appointment.

Series A Preferred shares:

On January 8, 2013 the company’s Chief Financial Officer stepped down from his position. Upon his resignation 780 preferred shares of series A, granted to him on April 20, 2012, were redeemed.

Long Time Incentive Plan (“2012 LTIP”):

The board of directors on December 10, 2009 decided to grant a conditional award totaling 143,800 (575,199 pre-reverse split equivalent) common shares of Globus to all employees of the Company existing at that date under the LTIP. According to the rules of the LTIP, subject to the employees continuing service, these shares will vest on a daily basis over the next three years, and one third of these shares will be allotted and delivered to them at nil cost on each of the first, second and third anniversaries of the grant date subject to (i) the employee remaining in employment on the date of vesting (vesting-service condition) and (ii) Globus being listed on NASDAQ or have raised more than $30,000 from third parties or both (non-vesting conditions) by

During the year ended December 31, ~~2010. On November 24, 2010,~~2013, the company revised its estimate on the number of shares that will be awarded at the end of ~~Globus were admitted for trading~~the award period with reference to the ~~NASDAQ Global Market~~“2012 LTIP” currently in effect, based on the non-market and ~~thus condition (ii) was satisfied. On December 10, 2010, the first anniversary~~service vesting conditions of the ~~LTIP, 47,823 (191,292 pre-reverse split equivalent) common shares~~award and reversed $239 of ~~Globus were issued and allotted to~~share based payment expense recognised during the ~~relevant award holders. The fair (market) value as at December 10, 2009, (grant date) of the common shares issued and allotted on December 10, 2010 was $279. From December 10, 2010 to~~year ended December 31, ~~2010, the Company recognized an accrued expense of $17 (2009:$17) in the consolidated statement of comprehensive income with a corresponding increase in equity under retained earnings.~~

2012.

For the year ended December 31, ~~2009:~~

~~Extra payment:~~

~~The remuneration committee on November 12, 2009~~2012:

Non-executive director’s payments:

Refers to the common shares issued or accrued during the year to our non-executive directors pursuant to their letters of appointment.

Share Bonus to executive directors

By a board of directors resolution dated February 22, 2012 it was decided to allot ~~42,763 (171,052, pre-reverse split equivalent)~~39,128 common shares of Globus to ~~the chief~~our two executive ~~officer~~officers as ~~an extra~~bonus payment for services rendered. The Company recorded an expense of ~~$175~~$181 equal to the fair (market) value of the shares as at ~~November 12, 2009 (the~~February 22, 2012 (“the grant ~~date)~~date”), which ~~amount~~ is included in the consolidated statement of comprehensive income, under share based payments, with a corresponding increase in equity under share capital and share premium. All shares were issued and allotted on ~~November 19, 2009.~~

~~F-27~~

February 22, 2012.

Series A Preferred shares:

Pursuant to a board of directors resolution dated April 20, 2012, 3,347 shares of Series A Preferred shares were granted to Globus’s two executive officers. The holders of Globus’s shares of Series A Preferred shares are entitled to receive dividends payable in cash in an amount per share to be determined by a unanimous resolution of Globus’s Remuneration Committee, in its sole discretion. The Company considers that the issuance of Series A Preferred shares to its executive officers falls under the scope of “IFRS 2 share-based payments” and is considered to be an equity settled share based transaction with employees. The fair value of the Series A Preferred shares was calculated using a discounted cash flow model based on the expectation of future cash dividends.

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. ~~Dollars -~~Dollars- except for share and per share data, unless
otherwise stated)

~~13. Share Based Payment (continued)~~

~~LTIP:~~

~~For the year ended December 31, 2009, the~~

Share Based Payment (continued)

The Company ~~recorded~~recognised an expense of ~~$122 relating~~$230 equal to the ~~LTIP in the consolidated statement of comprehensive income with a corresponding increase in equity under retained earnings. On March 5, 2009, on the first anniversary~~estimated fair value of the ~~LTIP, 21,440 (85,760 pre-reverse split equivalent) common shares of Globus were issued and allotted to~~Series A Preferred stock at the chief executive officer pursuant to the terms of this grant. The fair (market) value as at March 4, 2008 (grant date) of the shares issued and allotted to the director on March 5, 2009 was $703. On April 21, 2009, the board of directors in agreement with the chief executive officer of Globus, decided to release the unvested 42,763 (171,052 pre-reverse split equivalent) common shares awarded to him under the LTIP on March 4, 2008. The Company accounted for the cancellation of the award as an acceleration of vesting conditions and therefore recognized immediately the amount that otherwise would have been recognized for services received over the remaining vesting period to March 4, 2011. The amount recognized due to the cancellation of the unvested award was $1,402 and wasgrant date which is included in ~~the income statement component of~~ the consolidated statement of comprehensive income, under share based payments, with a corresponding increase in equity under retained earnings.

~~For~~ All Series A Preferred shares were issued during April 2012.

Long Time Incentive Plan (“2009 LTIP”):

On December 10, 2012, the ~~year ended December 31, 2008:~~

~~Extra payment:~~

~~The remuneration committee on April 15, 2008 decided to allot 4,224 (equivalent to 16,897 pre- reverse split) ordinary~~third and last anniversary of the “ 2009 LTIP”, 52,132 common shares of Globus were issued and allotted to the ~~chief financial officer of Globus as an extra payment for services rendered.~~relevant award holders. The ~~Company recorded an expense of $145 equal to the~~ fair (market) value of the common shares issued and allotted on April 21, 2008 (the grant date), the amount of which is included in the consolidated statement of comprehensive income, under share-based payments, with a corresponding increase in equity under share capital and share premium. All shares were issued on May 1, 2008.

December 10, 2012, was $303.

Long Time Incentive Plan (“2012 LTIP”):

By a ~~remuneration committee~~board of directors resolution dated ~~March 4, 2008,~~February 22, 2012 it was decided to ~~grant a~~grand two conditional ~~award~~equity settled awards to the ~~chief~~Globus’s two executive ~~officer~~officers:

a) A conditional equity settled award of ~~Globus of 59,335 (237,342 pre-reverse split equivalent)~~51,729 and 19,214 common shares of Globus ~~under the LTIP, with the conditional right for the shares~~was granted to be allotted and delivered to him in the future at no cost. According to the rules of the LTIP, subject to the executive’s continuing service, these shares were to vest on a daily basis over a three year period and, one third of these shares would be allotted and delivered to the executive at nil cost on each of the first, second and third anniversaries of the grant date. If a cash dividend was paid during the vesting period, additional shares would be granted calculated in accordance with the rules of the LTIP. Due to the payment of cash dividends to the Globus’ shareholders after the date of grant of the conditional award of theGlobus’s chief executive officer and chief financial officer respectively subject to i) the award holders continuing service until the end of ~~Globus, an additional 4,867 (19,469 pre-reverse split equivalent) common shares of Globus were added~~the award period which is defined to ~~the initially granted shares.~~

~~For the year ended~~be from January 1, 2011 to December 31, ~~2008, Globus~~2013, (service vesting condition) ii) 100% of the shares granted will vest at the end of the award period if the average total shareholders return (TSR) during the award period is calculated to be equal or over 10% and prorated if TSR is calculated to be less than 10%, (market vesting condition) iii) 100% of the shares granted will vest if the average net profit of the Company during the award period is 10 times the value of the shares granted valued at the starting price of $9.06 per share (the target amount) and prorated for average net profit achieved below the target amount (non-market vesting condition). From February 22, 2012 to December 31, 2012 the Company recognised an accrued an expense of ~~$581 relating to~~$48 in the ~~LTIP in~~income statement component of the consolidated statement of comprehensive income with a corresponding increase in equity under retained earnings.

~~F-28~~

b) A conditional equity settled award of 137,029 common shares and 50,896 common shares of Globus was granted to its chief executive officer and chief financial officer respectively subject to i) the award holders continuing service until the end of the award period which is defined to be from January 1, 2012 to December 31, 2014, (service vesting condition) ii) 100% of the shares granted will vest at the end of the award period if the average total shareholders return (TSR) during the award period is calculated to be equal or over 10% and prorated if TSR is calculated to be less than 10%, (market vesting condition) iii) 100% of the shares granted will vest if the average net profit of the Company during the award period is 10 times the value of the shares granted valued at the starting price of $3.31 per share (the target amount) and prorated for average net profit achieved below the target amount (non-market vesting condition). From February 22, 2012 to December 31, 2012 the Company recognised an accrued expense of $191 in the income statement component of the consolidated statement of comprehensive income with a corresponding increase in equity under retained earnings.

The fair value of the conditional share based awards described above was estimated at grant date using a Monte Carlo simulation model taking into account the terms and conditions upon which the awards were granted. The following table lists the inputs to the model used for the valuation of the awards under consideration:

	Award (a)	Award (b)
Measurement date	February 22,2012	February 22, 2012
Vesting date	December 31, 2013	December 31, 2014
Share price at measurement date	$4.63 per share	$4.63 per share
Start price	$9.06 per share	$3.31 per share
Risk free rate	0.70%	0.70%
Dividends	$0,885 per share	$0.245 per share
Annual volatility	65.0%	65.0%
Model used	Monte Carlo	Monte Carlo
Fair value	$1,46 per share	$3,40 per share

For the year ended December 31, 2011:

Non-executive director’s payments:

Refers to the common shares issued or accrued during the year to our non-executive directors pursuant to their letters of appointment.

Long Time Incentive Plan (“2009 LTIP”):

On December 10, 2011, the second anniversary of the “LTIP”, 52,989 common shares of Globus were issued and allotted to the relevant award holders. The fair (market) value of the common shares issued and allotted on December 10, 2011, was $324. From December 10, 2011 to December 31, 2011, the Company recognised an accrued expense of $16 (2010:$17) in the income statement component of the consolidated statement of comprehensive income with a corresponding increase in equity under retained earnings.

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. ~~Dollars -~~Dollars- except for share and per share data, unless
otherwise stated)

~~14. Voyage Expenses and Vessel Operating Expenses~~

Voyage Expenses and Vessel Operating Expenses

Voyage expenses and vessel operating expenses in the consolidated statement of comprehensive income ~~consist~~consisted of the following:

Voyage expenses ~~consist~~consisted of:

For the year ended December 31,
2010 2009 2008
Commissions 1,496 2,717 4,788
Bunkers expenses 382 521 1,597
Other voyage expenses 274 504 289
Total 2,152 3,742 6,674

	For the year ended December 31,
	2013		2012		2011
Commissions		1,257		1,268		1,580
Bunkers expenses		1,429		2,374		1,065
Other voyage expenses		206		808		638
Total		2,892		4,450		3,283

Vessel operating expenses ~~consist~~consisted of:

For the year ended December 31,
2010 2009 2008
Crew wages and related costs 3,078 5,268 5,930
Insurance 597 1,114 1,523
Spares, repairs and maintenance 1,005 1,753 2,080
Lubricants 429 949 1,174
Stores 662 868 1,595
Other 116 185 235
Total 5,887 10,137 12,537

~~15. Administrative Expenses~~

	For the year ended December 31,
	2013		2012			2011
Crew wages and related costs		5,107		5,212			4,119
Insurance		1,026		912			871
Spares, repairs and maintenance		2,072		2,192			1,322
Lubricants		711		746			510
Stores		858		1,094	��		951
Other		257		244			194
Total		10,031		10,400			7,967

Administrative Expenses

The amount shown in the consolidated statement of comprehensive income is ~~analyzed~~analysed as follows:

For the year ended December 31,
2010 2009 2008
Personnel expenses 1,249 1,556 1,435
Audit fees 189 78 96
Travelling expenses 12 12 44
Consulting fees 76 89 149
Communication 50 74 70
Stationery 7 7 14
NASDAQ registration related expenses 456 - -
Other 271 188 314
Total 2,310 2,004 2,122

~~F-29~~

~~GLOBUS MARITIME LIMITED~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Amounts presented in thousands of U.S. Dollars - except for share and per share data, unless otherwise stated)~~

~~16. Interest Expense and Finance Costs~~

	For the year ended December 31,
	2013		2012		2011
Personnel expenses		1,210		1,207		1,284
Audit fees		136		130		134
Travelling expenses		19		41		47
Consulting fees		109		149		228
Communication		25		27		37
Stationery		3		4		5
Greek authorities tax (note 21)		224		-		-
Other		366		311		343
Total		2,092		1,869		2,078

Interest Expense and Finance Costs

The amounts in the consolidated statement of comprehensive income are ~~analyzed~~analysed as follows:

	For the year ended December 31,
	2013		2012		2011
Interest payable on long-term borrowings		3,310		3,130		2,562
Commitment fees payable on long-term borrowings		-		15		44
Bank charges		45		41		36
Amortization of debt discount		116		129		112
Other finance expenses		100		43		67
Total		3,571		3,358		2,821

For the year ended December 31,
2010 2009 2008
Interest payable on long-term borrowings 1,712 2,669 6,872
Commitment fees payable on long-term borrowings 50 71 37
Bank charges 34 40 38
Amortization of debt discount 275 130 386
Other finance expenses 62 16 374
Total 2,133 2,926 7,707

F-28

~~17.~~

~~Dividends paid~~

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. Dollars- except for share and per share data, unless
otherwise stated)

Dividends

Dividends declared and paid during the years ended December 31, ~~2010, 2009~~2013, 2012 and ~~2008~~2011 are as follows:

US cents per share $ Date declared Date Paid
Final dividend for 2007 14.50(GBp 7.31) 4,154 February 29,2008 May 9, 2008
Interim dividend for 2008 50.00(GBp 26.9) 14,328 August 26, 2008 September 18, 2008
Interim dividend for 2010 11.29(GBp 7.3) 818 September 6, 2010 September 24, 2010
Quarterly dividend for 2010 16.00 1,166 December 2, 2010 December 28, 2010

~~18. Derivative financial instruments~~

December 31,
2010 2009
Assets Liabilities Assets Liabilities
Interest rate swaps - 1,800 - 1,220
Foreign exchange forward contracts - - - 10
Total - 1,800 - 1,230

No dividends declared or paid on common shares during the year ended December 31, 2013. Dividends declared or paid on Series A Preferred shares during the year ended December 31, 2013:

2013

$ per share

$000’s

Date declared

Date Paid

1st Preferred dividend

63.46

163

May 30, 2013

July 12, 2013

2nd Preferred dividend

65.20

167

December 27, 2013

January 15, 2014

330

Dividends declared and paid on common shares during the year ended December 31, 2012:

2012

$ per share

$000’s

Date declared

Date Paid

Quarterly dividend for 2011

0.16

1,622

February 28, 2012

March 22, 2012

Quarterly dividend for 2012

0.085

862

May 8, 2012

May 31, 2012

2,484

Dividends declared and paid on Series A Preferred shares during the year ended December 31, 2012:

2012

$ per share

$000’s

Date declared

Date Paid

1st Preferred dividend

80.00

268

May 8, 2012

2nd Preferred dividend

37.50

125

September 5, 2012

3rd Preferred dividend

39.75

133

December 4, 2012

526

Dividends declared and paid on common shares during the year ended December 31, 2011:

2011

$ per share

$000’s

Date declared

Date Paid

Quarterly dividend for 2010

0.16

1,166

February 24, 2011

March 17, 2011

Quarterly dividend for 2011

0.16

1,166

May 5, 2011

May 31, 2011

Quarterly dividend for 2011

0.16

1,166

June 4, 2011

July 28, 2011

Quarterly dividend for 2011

0.16

1,608

October 20, 2011

November 9, 2011

5,106

Derivative financial instruments

	December 31,
	2013				2012
	Assets		Liabilities		Assets		Liabilities
Interest rate swaps		-		-		-		738
Total		-		-		-		738

During November 2008, the Company entered into an interest rate swap agreement of a notional amount of $10,000 effective from November 28, 2008 to November 29, 2013. For the period from November 28, 2008 to November 23, 2010 the Company exchanged 6 month ~~LIBOR~~Libor interest rate with a fixed interest rate of 2.40%. On November 23, 2010, the swap counterparty had the option to select either (a) to exchange 6 month ~~LIBOR~~Libor interest rate with a fixed interest rate of 3.60%, or (b) to exchange 6 month ~~LIBOR~~Libor interest rate with 6 month ~~LIBOR~~Libor interest rate minus 20 basis points for the remaining period to maturity. On November 23, 2010, the swap counterparty selected option (a). As ~~at December 31, 2010 and 2009,~~of November 29, 2013 the ~~aforementioned~~ interest rate swap ~~had a~~agreement reached its maturity. As at that date its fair value was $nil, as of ~~$715 and $430, respectively,~~December 31, 2012 its fair value was $283 in favor of the swap ~~counterparty.~~

counterparty

On June 17, 2010, ~~Globus~~the Company and the aforementioned swap counterparty entered into a deed of pledge for an amount of $1,000 against all existing, future and contingent claims of the swap counterparty under the interest rate swap agreement.

~~F-30~~

As of November 29, 2013 when the interest rate swap agreement reached its maturity the deed of pledge expired.

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. ~~Dollars -~~Dollars- except for share and per share data, unless
otherwise stated)

~~18. Derivative financial instruments (continued)~~

Derivative financial instruments (continued)

During November 2008, the Company entered into an interest rate swap agreement of a notional amount of $15,000 effective from November 28, 2008 to November 28, 2013. For the period from November 28, 2008 to November 29, 2010, the Company, exchanged 3 month ~~LIBOR~~Libor interest rate with a fixed interest rate of 2.45%. AtOn November 29, 2010 and for the remaining period to maturity the swap counterparty has the option to select either (a) to exchange 3 month ~~LIBOR~~Libor interest rate with a fixed interest rate of 3.64%, or (b) to exchange 3 month ~~LIBOR~~Libor interest rate with 3 month ~~LIBOR~~Libor interest rate minus 20 basis points. On November 29, 2010, the swap counterparty selected option (a). As ~~at December 31, 2010 and 2009,~~of November 28, 2013 the ~~aforementioned~~ interest rate swap ~~had a~~agreement reached its maturity. As at that date its fair value was $nil, as of ~~$1,085 and $790, respectively,~~December 31, 2012 its fair value was $455 in favor of the swap counterparty.

~~Gains~~

Gain on the fair value of interest rate swap contracts for the years ended December 31, 2013, 2012 and 2011 amounted to $738, $ 693 and $369 respectively. The Company recognizes gains and losses on interest rate swap contracts, ~~are recognized~~ in the income statement component of the consolidated statement of comprehensive income in finance costs.

~~19. Gain/(loss) on sale of vessels~~

~~During the year ended December 31, 2008, the Group sold m/v Ocean Globe for $37,000.~~

~~During the year ended December 31, 2009, the Company sold m/v Island Globe, m/v Gulf Globe and m/v Lake Globe for a selling price of $19,100, $15,500 and $16,500 respectively.~~

~~During the year ended December 31, 2010, the Company sold m/v Sea Globe and m/v Coral Globe for a selling price of $17,500 and $16,500 respectively.~~

~~The gain/(loss) on the sale of the vessels were calculated as follows:~~

For the year ended December 31,
2010 2009 2008
Proceeds (note 5) 34,000 51,100 37,000
Carrying amount of vessel sold (note 5) (33,030 ) (49,833 ) (21,657 )
Other selling expenses (963 ) (2,069 ) (248 )
Net gain/(loss) on sale 7 (802 ) 15,095

~~20. Contingencies~~

Contingencies

Various claims, suits and complaints, including those involving government regulations, arise in the ordinary course of the shipping business. In addition, losses may arise from disputes with charterers, environmental claims, agents, and insurers and from claims with suppliers relating to the operations of the Company’s vessels. Currently, management is not aware of any such claims or contingent liabilities, ~~that~~which are material for disclosure.

~~21. Commitments~~

Commitments

The Company enters into time charter and bareboat charter arrangements on its vessels. These non-cancellable arrangements had remaining terms between 6six days ~~(spot charter)~~ to 49thirteen months ~~(time charter)~~ as of December 31, ~~2010~~2013 and between ~~ten~~eight days totwenty five months as of December 31, ~~2009~~2012, assuming redelivery at the earliest possible date.

Future gross minimum lease revenues receivable under non-cancellable operating leases as of December 31, ~~2010~~2013 and ~~2009~~2012, are as follows (vessel off-hires and dry-docking days that could occur but are not currently known are not taken into consideration; in addition early delivery of the vessels by the charterers is not ~~taken into account)~~accounted for):

~~F-31~~

~~GLOBUS MARITIME LIMITED~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Amounts presented in thousands of U.S. Dollars - except for share and per share data, unless otherwise stated)~~

~~21. Commitments (continued)~~

2010 2009
Within one year 14,492 2,925
After one year but not more than five years 16,017 -
More than five years - -
Total 30,509 2,925

	2013		2012
Within one year		12,341		17,567
After one year but not more than five years		550		11,123
Total		12,891		28,690

These amounts include consideration for other elements of the arrangement apart from the right to use the vessel such as maintenance and crewing and its related costs.

At December 31, ~~2010~~2013 and ~~2009,~~2012, the Company was a party to an operating lease agreement as ~~lessee.~~lessee (note 4). The operating lease relates to the office premises of the Manager (expiring in August 2015).

The future minimum lease payments under this agreement as of December 31, ~~2010~~2013 and ~~2009~~2012 assuming a Euro:~~U.S.~~ US dollar exchange rate of 1:1.4, were as follows:

2010 2009
Within one year 253 247
After one year but not more than five years 983 1,051
More than five years - 185
Total 1,236 1,483

	2013		2012
Within one year		251		247
After one year but not more than five years		170		425
Total		421		672

Total rent expense under operating leases for the years ended December 31, ~~2010~~2013 and ~~2009~~2012, amounted to $232 and ~~$239,~~$226, respectively.

~~22.~~

Income Tax

Under the laws of the countries of the ~~Company’s domestication/~~companies’ incorporation ~~and/~~and / or vessels’ registration, the ~~Company is~~companies are not subject to tax on international shipping ~~income. However, it is~~income; however, they are subject to registration and tonnage taxes, which are included in vessel operating expenses in the accompanying consolidated statements of income.

Greek Authorities Tax

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. Dollars- except for share and per share data, unless

otherwise stated)

Income Tax (continued)

Greek Authorities Tax (continued)

establishing an identical tonnage tax regime as the one already in force for vessels flying the Greek flag. This tax varies depending on the size of the vessel, calculated in gross registered tonnage, as well as on the age of each vessel. Payment of this tonnage tax completely satisfies all income tax obligations of both the shipowning company and of all its shareholders up to the ultimate beneficial owners. Any tax payable to the state of the flag of each vessel as a result of its registration with a foreign flag registry (including the Marshall Islands) is subtracted from the amount of tonnage tax due to the Greek tax authorities. As of December 31, 2013, the tax expense under the new law amounted to $224 and is included in administrative expenses in the consolidated statement of comprehensive income.

U.S. Federal Income Tax

Globus is a foreign corporation with wholly owned subsidiaries that are foreign corporations, which derive income from the international operation of a ship or ships from sources within the United States (“U.S”) for U.S. federal income tax purposes.

Globus believes that to the best of its knowledge, under ~~§883~~§ 883 of the Internal Revenue Code, its income and the income of its ship-owning subsidiaries, to the extent derived from the international operation of a ship or ships, isare currently exempt from U.S. federal income tax.

The following is a summary, discussing the application of the U.S. federal income tax laws to the Company relating to income derived from the international operation of a ship or ships. The discussion and its conclusion is based upon existing U.S. federal income tax law, including the Internal Revenue Code (the “Code”) and final U.S. Treasury Regulations (the “Regs”) as currently in effect, all of which are subject to change, possibly with retroactive effect.

Application of ~~§883~~§ 883 of the Code for the year ended December 31, ~~2010~~

2013

In general, under ~~§883,~~§ 883, certain non-U.S. corporations are not subject to U.S. federal income tax on their U.S. source income derived from the international operation of a ship or ships.

~~F-32~~

~~GLOBUS MARITIME LIMITED~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Amounts presented in thousands of U.S. Dollars - except for share and per share data, unless otherwise stated)~~

~~22.~~

~~Income Tax (continued)~~

Effective for any tax year ending on September 25, 2004 and thereafter, the Regs provide that a foreign corporation will qualify for the benefits of ~~§883~~§ 883 if, in relevant part, the foreign country in which the foreign corporation is organized grants an equivalent exemption to corporations organized in the U.S. and the foreign corporation meets the qualified shareholder test described below.

A foreign corporation having more than 50 percent of the value of its outstanding shares owned, directly or indirectly by application of specific attribution rules, for at least half of the number of days in the foreign ~~corporation’s~~corporation's taxable year by one or more qualified shareholders will meet the qualified shareholder test. In part, an individual who is a shareholder will be considered a qualified shareholder if ~~such shareholder is~~they are a resident of a qualified foreign country and ~~does~~do not own ~~his, her or its~~their interest in the foreign corporation through bearer shares, either directly or indirectly by application of the attribution rules.

For the ~~period~~year ended December 31, ~~2010,~~2013, Globus and ~~Globus’~~its wholly owned subsidiaries deriving income from the operation of international ships are organized in foreign countries that grant equivalent exemptions to corporations organized in the ~~United States.~~U.S. Globus and its relevant subsidiaries have more than 50% of the value of their stock for at least half of the number days of their taxable year indirectly owned in the form of registered shares by one individual residing in a qualified foreign country. Accordingly, all of Globus’ and its ship-owning or operating subsidiaries that rely on ~~§883~~§ 883 for exempting U.S. source income from the international operation of ships would not be subject to U.S. federal income tax for the ~~period~~year ended December 31, ~~2010.~~2013. Globus anticipates it and its relevant subsidiaries income will continue to be exempt in the future from U.S. federal income tax. However, in the future, Globus or its subsidiaries may not continue to satisfy certain criteria in the U.S. tax laws and as such, may become subject to the U.S. federal income tax on future U.S. source shipping income.

~~23. Financial risk management objectives and policies~~

Financial risk management objectives and policies

The Company’s financial liabilities are bank loans, trade and other payables. The main purpose of these financial liabilities is to assist in the financing of Company’s operations and the acquisition of vessels. The Company has various financial assets such as trade receivables and cash and short-term deposits, which arise directly from its operations. The main risks arising from the Company’s financial instruments are cash flow interest rate risk, credit risk, liquidity risk and foreign currency risk.

F-31

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. Dollars- except for share and per share data, unless

otherwise stated)

Financial risk management objectives and policies (continued)

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s long-term debt obligations with floating interest rates. To manage this, the Company usually enters into interest rate swaps, in which the Company agrees to exchange, at specific intervals, the difference between fixed and variable interest rate.

Interest amounts are calculated by reference to an agreed upon notional principal amount. ~~After taking into account~~As of December 31, 2013 the ~~effect of~~Company had no interest rate ~~swaps, approximately 26%~~swap agreements in place. As of December 31, 2012, 24% of the Company’s bank borrowings ~~as at December 31, 2010 and 35% as of December 31, 2009~~ were at a fixed rate of interest.

~~F-33~~

~~GLOBUS MARITIME LIMITED~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Amounts presented in thousands of U.S. Dollars - except for share and per share data, unless otherwise stated)~~

~~23. Financial risk management objectives and policies (continued)~~

Interest rate risk table

The following table demonstrates the sensitivity to a reasonably possible change in interest rates, with all other variables held constant, of the Company’s profit. There is no impact on the Company’s equity.

Increase/Decrease in basis
points
Effect on profit

2010
LIBOR +15 (83 )
-20 111
2009
LIBOR +15 (219 )
-20 292

	Increase/Decrease in basis points		Effect on profit

2013
$ Libor		+15		(116	)
		-20		155
2012
$ Libor		+15		(128	)
		-20		171

Foreign currency risk

The following table demonstrates the sensitivity to a reasonably possible change in the Euro exchange rate, with all other variables held constant, to the Company’s profit due to changes in the fair value of monetary assets and liabilities. The Company’s exposure to foreign currency changes for all other currencies as of December 31, ~~2010~~2013 and ~~2009~~2012 was not material.

Change in rate Effect on profit

2010 +10 % $ 60
-10 % (60 )

2009 +10 % $ 404
-10 % (404 )

	Change in rate			Effect on profit

2013		+10%			(75	)
		-10	%		75

2012		+10%			16
		-10	%		(16	)

Credit risk

The Company operates only with ~~recognized,~~recognised, creditworthy third parties including major charterers, commodity traders and government owned entities. Receivable balances are monitored on an ongoing basis with the result that the Company’s exposure to impairment on trade receivable is not significant. The maximum exposure is the carrying value of trade receivable as indicated in the consolidated statement of financial position. With respect to the credit risk arising from other financial assets of the Company such as cash and cash equivalents, the Company’s exposure to credit risk arises from default of the counter parties, which are ~~recognized~~recognised financial institutions.

The Company performs annual evaluations of the relative credit standing of these counter parties. The exposure of these financial instruments is equal to their carrying amount as indicated in the consolidated statement of financial position.

~~F-34~~

~~GLOBUS MARITIME LIMITED~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Amounts presented in thousands of U.S. Dollars - except for share and per share data, unless otherwise stated)~~

~~23. Financial risk management objectives and policies (continued)~~

Concentration of credit risk table:

The following table provides information with respect to charterers who individually, accounted for approximately more than 10% of the Company’s revenue for the years ended December 31, ~~2010, 2009~~2013, 2012 and ~~2008:~~2011:

	2013		%			2012		%			2011		%
A		2,838		10	%		6,574		20	%		3,430		10	%
B		5,860		20	%		5,644		18	%		1,705		5	%
C		5,201		18	%		5,216		16	%		5,201		15	%
D		3,637		12	%		4,503		14	%		1,547		4	%
E		2,628		9	%		-		-			-		-
F		-		-			1,753		5	%		5,150		14	%
G		-		-			1,283		4	%		9,338		26	%
Other		9,270		31	%		7,224		22	%		9,188		26	%
Total		29,434		100	%		32,197		100	%		35,559		100	%

F-32

2010 % 2009 % 2008 %
A 11,239 39 % - - - -
B 4,195 15 % - - - -
C 2,723 9 % - - - -
D 631 2 % 7,373 14 % 10,371 11 %
E - - 23,162 44 % 21,553 22 %
F - - - - 15,756 16 %
Other 10,072 35 % 22,277 42 % 50,917 51 %
Total 28,860 100 % 52,812 100 % 98,597 100 %

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. Dollars- except for share and per share data, unless

otherwise stated)

Financial risk management objectives and policies (continued)

Liquidity risk

The Company mitigates liquidity risk by managing cash generated by its operations, ~~and~~ applying cash collection targets appropriately. The vessels are normally chartered under ~~time charter~~time-charter, bareboat and spot agreements where, as per the industry practice, the charterer pays for the transportation service 15 days in advance, supporting the management of cash generation. Vessel acquisitions are carefully controlled, with ~~authorization~~authorisation limits operating up to board level and cash payback periods applied as part of the investment appraisal process. In this way, the Company maintains a good credit rating to facilitate fund raising. In its funding strategy, the Company’s objective is to maintain a balance between continuity of funding and flexibility through the use of bank loans. Excess cash used in managing liquidity is only invested in financial instruments exposed to insignificant risk of changes in market value or are being placed on interest bearing deposits with maturities fixed atusually for no more than 3 months. The Company monitors its risk relating to the shortage of funds by considering the maturity of its financial liabilities and its projected cash flows from operations.

The table below ~~summarizes~~summarises the maturity profile of the Company’s financial liabilities at December 31, ~~2010~~2013 and ~~2009,~~2012, based on contractual undiscounted cash flows.

Year ended December 31, 2010
On
demand

Less than 3
months

3 to 12
months

1 to 5
years

More
than 5
years
Total
Long-term debt - 791 11,563 73,978 16,210 102,542
Interest rate swap, net - 127 699 1,659 - 2,485
Accrued liabilities and other payables - 698 - - - 698
Trade payables - 1,346 - - - 1,346
Total - 2,962 12,262 75,637 16,210 107,071

Year ended December 31, 2009
On
demand

Less than 3
months

3 to 12
months

1 to 5
years

More
than 5
years
Total
Long-term debt - 949 10,522 56,222 5,964 73,657
Interest rate swap, net - 44 615 2,340 - 2,999
Accrued liabilities and other payables - 1,095 - - - 1,095
Trade payables - 1,158 - - - 1,158
Total - 3,246 11,137 58,562 5,964 78,909

~~F-35~~

~~GLOBUS MARITIME LIMITED~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Amounts presented in thousands of U.S. Dollars - except for share and per share data, unless otherwise stated)~~

~~23. Financial risk management objectives and policies (continued)~~

Year ended December 31, 2013	On demand		Less than 3 months		3 to 12 months		1 to 5 years		More than 5 years		Total
Long-term debt		-		1,534		12,868		77,122		5,466		96,990
Accrued liabilities and other payables		-		1,417		-		-		-		1,417
Trade payables		-		2,097		-		-		-		2,097
Total		-		5,048		12,868		77,122		5,466		100,504

Year ended December 31, 2012	On demand		Less than 3 months		3 to 12 months		1 to 5 years		More than 5 years		Total
Long-term debt		5,765		2,029		14,923		76,706		14,558		113,981
Interest rate swap, net		-		80		665		-		-		745
Accrued liabilities and other payables		-		1,099		-		-		-		1,099
Trade payables		-		1,720		-		-		-		1,720
Total		5,765		4,928		15,588		76,706		14,558		117,545

Capital management

The primary objective of the Company’s capital management is to ensure that it maintains a strong credit rating and healthy capital ratios in order to support its business and ~~maximize~~maximise shareholder value. The Company manages its capital structure and makes adjustments to it, in light of changes in economic conditions. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares as well as managing the outstanding level of debt. Lenders may impose capital structure or solvency ratios, refer to note 12. No changes were made in the objectives, policies or processes during the years ended December 31, ~~2010~~2013 and ~~2009.~~

2012. The Company monitors capital using the ratio of net debt to book ~~capitalization~~capitalisation adjusted for the market value of the Company’s vessels plus net debt. The Company includes within net debt, interest bearing loans gross of unamortized debt discount, less cash and bank balances and bank ~~deposits and restricted cash.~~

deposits.

Adjusted book capitalization refers to total equity adjusted for the market value of the Company’s ~~vessels plus net debt.~~vessels. The Company’s policy is to keep the ratio described above ~~below~~between the range of 60% to 80%.

	December 31,
	2013			2012
Interest bearing loans		91,504			105,929
Cash and bank balances and bank deposits		(5,889	)		(11,653	)
Net debt		85,615			94,276

Equity		60,339			55,182
Adjustment for the market value of vessels (charter-free)		(4,261	)		(29,961	)
Adjusted book capitalization		56,078			25,221

Adjusted book capitalization plus net debt		141,693			119,497
Ratio		60.4	%		78.9	%

The improvement in the ratio of net debt to adjusted capitalization plus net debt resulted from the increase in the market value of the Company’s vessels coupled with the reduction in the Company’s long term debt.

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. Dollars- except for share and per share data, unless

December 31,
2010 2009
Interest bearing loans 96,650 70,562
Cash and bank balances and bank deposits (24,618 ) (59,157 )
Net debt 72,032 11,405

Equity 117,788 113,458
Adjustment for the market value of vessels (charter-free) (37,926 ) (36,696 )
Book capitalization 79,862 76,762

Adjusted book capitalization plus net debt 151,894 88,167
Ratio 47 % 13 %

otherwise stated)

Financial risk management objectives and policies (continued)

Capital management (continued)

Net debt as calculated above is not consistent with the ~~IFRS~~International Financial Reporting Standards (‘IFRS”) definition of debt. The following reconciliation is provided:

December 31,
2010 2009
Debt in accordance with IFRS (long & short-term borrowings) 96,238 70,075
Add: Unamortized debt discount 412 487
96,650 70,562
Less: Cash and bank balances and bank deposits 24,618 59,157
Net debt 72,032 11,405

	December 31,
	2013		2012
Debt in accordance with IFRS (long & short-term borrowings)		91,210		105,519
Add: Unamortized debt discount		294		410
		91,504		105,929
Less: Cash and bank balances and bank deposits		5,889		11,653
Net debt		85,615		94,276

~~24.~~

~~Financial Instruments~~23

Fair values

~~Fair~~

The carrying values

of financial instruments such as cash and bank balances, trade receivables and trade payables are reasonable estimates of their fair value due to the short term nature of these financial instruments. The fair values of the credit and loan facilities as of December 31, 2013 and 2012 was $90,739 and 103,183 respectively while their carrying value measured at amortised cost as of December 31, 2013 and 2012 was $91,210 and $105,519 respectively. Derivative financial instruments are ~~recorded~~stated at fair value.

Interest rate swap agreements are valued using valuation techniques with market observable inputs. The most frequently applied valuation technique includes swap models, using present value ~~while all other financial~~calculations incorporating forward interest rate curves.

Fair value of the Company’s long term debt is estimated by discounting future cash flows using rates currently available for debt on similar terms, credit risk and remaining maturities.

Fair value measurement

The following table provides the fair value measurement hierarchy (as defined in note 2.30) of the Company’s assets and ~~financial liabilities are recorded at amortized cost which approximates fair value at December 31, 2010 and 2009.~~

~~Fair value hierarchy~~

Liabilities

As at December 31, ~~2010~~2013 and ~~2009,~~2012, the Company held the following ~~financial instruments~~assets and liabilities measured at or disclose their fair value:

Assets measured at fair value	December 31, 2013		Level 1		Level 2		Level 3
Vessel classified as held for sale		11,767		-		11,767		-
Liabilities measured at fair value
Interest rate swaps		-		-		-		-
Liabilities for which fair values are disclosed
Long term debt		90,739		-		90,739		-

Assets measured at fair value	December 31, 2012		Level 1		Level 2		Level 3
Vessel classified as held for sale		9,200		-		9,200		-
Liabilities measured at fair value
Interest rate swaps		738		-		738		-
Liabilities for which fair values are disclosed
Long term debt		103,183		-		103,183		-

There have been no transfers between Level 1 and Level 2 during the years

As of December 31, 2013 the vessel classified as held for sale was measured at fair ~~value:~~

~~F-36~~

value of $11,767, less estimated cost to sell of $401, less deferred dry docking costs of $811 resulting in a gain of $1,679 when compared to the fair value less cost to sell as of December 31, 2012 which was included in the income statement component of the consolidated statement of comprehensive income under impairment gain/ (loss) for the year.

As of December 31, 2012 the vessel classified as held for sale with a carrying amount of $33,319 was written down to its fair value of $9,200, less estimated costs to sell of $324, resulting in a loss of $24,443 which was included in the income statement component of the consolidated statement of comprehensive income under impairment gain/ (loss) for the year.

GLOBUS MARITIME LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amounts presented in thousands of U.S. ~~Dollars -~~Dollars- except for share and per share data, unless
otherwise stated)

~~24. Financial Instruments (continued)~~

Liabilities at fair value December 31, 2010 Level 1 Level 2 Level 3
Interest rate swaps 1,800 - 1,800 -
Total 1,800 - 1,800 -

Liabilities at fair value December 31, 2009 Level 1 Level 2 Level 3
Interest rate swaps 1,220 - 1,220 -
Foreign exchange forward contracts 10 - 10 -
Total 1,230 - 1,230 -

Events after the reporting date

Revisions to Credit Facility

During March 2014, the Company reached an agreement with Credit Suisse on permanently revising certain terms of our Credit Facility as listed below. The Company ~~uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:~~

agreed with Credit Suisse that:

The Company must maintain cash and cash equivalents of not less than $5,000 conditional on the Company not declaring and paying dividends to common shareholders. In the event of dividend payment, the Company must maintain cash and cash equivalents of not less than $7,000 and will have to maintain such amount during a continuous period of at least three months following the dividend payment, upon which the minimum amount will be reduced to the $5,000 requirement.

From March 31, 2014 onwards the Credit Facility will bear interest at LIBOR plus a margin of 1.20%.

The Company is prohibited from paying dividends to the holders of preferred shares in an amount that will exceed $500 per fiscal year when cash and cash equivalents of the Company are less than $7,000.

~~Level 1:~~

~~quoted (unadjusted) prices in active markets for identical assets or liabilities.~~F-35

~~Level 2:~~

~~other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.~~

~~Level 3:~~

~~techniques that use inputs that have a significant effect on the recorded fair value that are not based on observable market data.~~

~~25. Events after the reporting date~~

~~Quarterly dividend declared~~

By a board of directors resolution dated February 24, 2011, a quarterly dividend of $0.16 per share relating to the three months ended December 31, 2010 was declared. The quarterly dividend was paid in March 2011.

~~Vessel Acquisition~~

In March 2011, the Company entered into a memorandum of agreement with an unaffiliated third party for, subject to certain conditions, the acquisition of a 58,790 dwt dry bulk carrier built in 2007 for a purchase price of $30,300. The vessel is expected to be delivered during the third quarter of 2011. In addition, the vessel will be acquired with a time charter agreement attached at a gross daily rate of $16 that is expected to terminate in the first quarter of 2015.

~~F-37~~

Title of Each Class	Name of Each Exchange On Which Registered
Common Shares, par value $0.004 per share	Nasdaq Global Market

U.S. GAAP ¨	International Financial Reporting Standards as issued	Other ¨
	by the International Accounting Standards Board x

	Within One Year		One to Three Years		Three to Five Years		More than Five years		Total
	(in thousands of U.S. Dollars)
Long term debt(1)	$	11,000		22,000		48,000		15,650	$	96,650
Operating lease obligations(2)		253		525		458		-		1,236

Name and address of beneficial owner	Number of common shares beneficially owned as of March 25, 2011		Percentage of common shares beneficially owned as of March 25, 2011
George Feidakis(1)		4,474,475		61.4	%
George Karageorgiou(2)		271,697		3.7	%
Ioannis Panayiotopoulos(3)		428,928		5.9	%
Commerzbank AG(4)		481,615		6.6	%
Elias S. Deftereos		22,981		*
Amir Eilon		10,401		*
Jeffrey O. Parry		472		*

All executive officers and directors as a group (five persons)		4,780,026		65.6	%

	Common Stock
	Pre-reverse split equivalent
	Number of		Par		Number of		Par		Issued share		Share		Retained			Total
	Shares		Value		Shares		Value		Capital		Premium		Earnings			Equity

Balance at January 1, 2008		28,636,153		0.001		7,159,039		0.004		29		87,411		9,237			96,677
Profit for the year		-		-		-		-		-		-		42,818			42,818
Other comprehensive income/(loss)		-		-		-		-		-		-		-			-
Total comprehensive income for the year		-		-		-		-		-		-		42,818			42,818
Share based payment (note 13)		29,297		0.001		7,324		0.004		-		189		581			770
Dividends paid (note 17)		-		-		-		-		-		-		(18,482	)		(18,482	)
Balance at December 31, 2008		28,665,450		0.001		7,166,363		0.004		29		87,600		34,154			121,783
Loss for the year		-		-		-		-		-		-		(10,079	)		(10,079	)
Other comprehensive income/(loss)		-		-		-		-		-		-		-			-
Total comprehensive loss for the year		-		-		-		-		-		-		(10,079	)		(10,079	)
Share based payment (note 13)		290,722		0.001		72,680		0.004		-		916		838			1,754
Dividends paid (note 17)		-		-		-		-		-		-		-			-
Balance at December 31,2009		28,956,172		0.001		7,239,043		0.004		29		88,516		24,913			113,458
Profit for the year		-		-		-		-		-		-		6,003			6,003
Other comprehensive income/(loss)		-		-		-		-		-		-		-			-
Total comprehensive income for the year		-		-		-		-		-		-		6,003			6,003
Share based payment (note 13)		202,580		0.001		50,645		0.004		-		301		10			311
Dividends paid (note 17)		-		-		-		-		-		-		(1,984	)		(1,984	)
Balance at December 31, 2010		29,158,752		0.001		7,289,688		0.004		29		88,817		28,942			117,788

Vessel Cost	Cost			Accumulated Depreciation			Net Book Value
Balance as of January 1, 2008		283,455			(11,449	)		272,006
Vessel improvements		307			-			307
Vessel disposals		(24,817	)		3,319			(21,498	)
Impairment loss		-			(20,224	)		(20,224	)
Depreciation for the year		-			(17,390	)		(17,390	)
Balance at December 31, 2008		258,945			(45,744	)		213,201
Vessel disposals		(63,032	)		14,545			(48,487	)
Impairment loss		-			(28,429	)		(28,429	)
Depreciation for the year		-			(11,172	)		(11,172	)
Vessels held for sale		(42,761	)		10,404			(32,357	)
Balance at December 31, 2009		153,152			(60,396	)		92,756
Vessels additions, net		106,084			-			106,084
Depreciation for the year		-			(7,353	)		(7,353	)
Balance at December 31, 2010		259,236			(67,749	)		191,487

Drydocking Cost	Cost			Accumulated Depreciation			Net Book Value
Balance at January 1, 2008		2,880			(1,166	)		1,714
Drydocking additions		2,823			-			2,823
Disposals		(406	)		247			(159	)
Depreciation for the year		-			(1,572	)		(1,572	)
Balance at December 31, 2008		5,297			(2,491	)		2,806
Drydocking additions		1,135			-			1,135
Disposals		(3,104	)		1,758			(1,346	)
Depreciation for the year		-			(1,512	)		(1,512	)
Vessels held for sale		(1,947	)		1,274			(673	)
Balance at December 31, 2009		1,381			(971	)		410
Drydocking additions		19			-			19
Depreciation for the year		-			(410	)		(410	)
Balance at December 31, 2010		1,400			(1,381	)		19

Vessel net book value at December 31, 2008	264,242	(48,235	)	216,007
Vessel net book value at December 31, 2009	154,533	(61,367	)	93,166
Vessel net book value at December 31, 2010	260,636	(69,130	)	191,506

Common shares issued and fully paid	Number of shares pre- reverse split		Number of shares		USD
At January 1, 2008		28,636,153		7,159,039		28,636
Issued during the year (share based compensation note 13)		29,297		7,324		29
At December 31, 2008		28,665,450		7,166,363		28,665
Issued during the year (share based compensation note 13)		290,722		72,680		291
At December 31, 2009		28,956,172		7,239,043		28,956
Issued during the year (share based compensation note 13)		202,580		50,645		203
At December 31, 2010		29,158,752		7,289,688		29,159

	Borrower	Loan Balance		Unamortized Debt Discount			Total Borrowings
(a)	Globus Maritime Limited		71,000		(230	)		70,770
(b)	Kelty Marine Ltd.		25,650		(182	)		25,468

	Total at December 31, 2010		96,650		(412	)		96,238
	Less: Current Portion		11,000		(94	)		10,906
	Long-Term Portion		85,650		(318	)		85,332

	Total at December 31, 2009		70,562		(487	)		70,075
	Less: Current Portion		34,157		(257	)		33,900
	Long-Term Portion		36,405		(230	)		36,175

	Bank Loan
December 31	(a)		(b)		Total
2011		9,000		2,000		11,000
2012		9,000		2,000		11,000
2013		9,000		2,000		11,000
2014		9,000		2,000		11,000
2015		35,000		2,000		37,000
2016 and thereafter		-		15,650		15,650
Total		71,000		25,650		96,650

	For the year ended December 31, 2010
	Common Shares pre-reverse split		Common shares		Share premium		Retained earnings
Non executive directors payment (note 4)		11,288		2,822		22		9
“LTIP” shares issued		191,292		47,823		279		(17	)
“LTIP” accrued current year		-		-		-		17
“LTIP” portion forfeited		-		-		-		1
Total		202,580		50,645		301		10

	For the year ended December 31, 2009
	Common Shares pre-reverse split		Common shares		Share premium		Retained earnings
Non executive directors payment (note 4)		33,910		8,477		38		-
Extra payment		171,052		42,763		175		-
“LTIP” shares issued		85,760		21,440		703		(581	)
“LTIP” accrued current year		-		-		-		17
“LTIP” portion cancelled		-		-		-		1,402
Total		290,722		72,680		916		838

	For the year ended December 31, 2008
	Common Shares pre-reverse split		Common shares		Share premium		Retained earnings
Non executive directors payment (note 4)		12,400		3,100		44		-
Extra payment		16,897		4,224		145		-
“LTIP” accrued current year		-		-		-		581
Total		29,297		7,324		189		581

	US cents per share	$		Date declared	Date Paid
Final dividend for 2007	14.50(GBp 7.31)		4,154	February 29,2008	May 9, 2008
Interim dividend for 2008	50.00(GBp 26.9)		14,328	August 26, 2008	September 18, 2008
Interim dividend for 2010	11.29(GBp 7.3)		818	September 6, 2010	September 24, 2010
Quarterly dividend for 2010	16.00		1,166	December 2, 2010	December 28, 2010

	2010		%			2009		%			2008		%
A		11,239		39	%		-		-			-		-
B		4,195		15	%		-		-			-		-
C		2,723		9	%		-		-			-		-
D		631		2	%		7,373		14	%		10,371		11	%
E		-		-			23,162		44	%		21,553		22	%
F		-		-			-		-			15,756		16	%
Other		10,072		35	%		22,277		42	%		50,917		51	%
Total		28,860		100	%		52,812		100	%		98,597		100	%

Year ended December 31, 2010	On demand		Less than 3 months		3 to 12 months		1 to 5 years		More than 5 years		Total
Long-term debt		-		791		11,563		73,978		16,210		102,542
Interest rate swap, net		-		127		699		1,659		-		2,485
Accrued liabilities and other payables		-		698		-		-		-		698
Trade payables		-		1,346		-		-		-		1,346
Total		-		2,962		12,262		75,637		16,210		107,071

Year ended December 31, 2009	On demand		Less than 3 months		3 to 12 months		1 to 5 years		More than 5 years		Total
Long-term debt		-		949		10,522		56,222		5,964		73,657
Interest rate swap, net		-		44		615		2,340		-		2,999
Accrued liabilities and other payables		-		1,095		-		-		-		1,095
Trade payables		-		1,158		-		-		-		1,158
Total		-		3,246		11,137		58,562		5,964		78,909

Liabilities at fair value	December 31, 2010		Level 1		Level 2		Level 3
Interest rate swaps		1,800		-		1,800		-
Total		1,800		-		1,800		-

Liabilities at fair value	December 31, 2009		Level 1		Level 2		Level 3
Interest rate swaps		1,220		-		1,220		-
Foreign exchange forward contracts		10		-		10		-
Total		1,230		-		1,230		-