Comments from Management

Mr. Ion Varouxakis, Chairman and CEO, stated, "We are pleased to report solid operating results for the fourth quarter of 2010 and for the year ended in December 31, 2010, which included significant deleveraging for the Company along with strong cash generation. 2010 was the beginning of our fleet renewal process with the ordering of two high-specification newbuilding Handysize vessels expected to be delivered in the second and third quarters of 2012. The financing of these vessels has already been arranged on favorable terms, subject to customary loan documentation for up to an amount of $32.4 million. As such, we expect to replace some of our older tonnage with our newbuildings, making timely sales depending on market conditions. We believe that this strategy will allow the Company to take advantage of pricing arbitrage opportunities in our sector between second-hand and newbuilding vessels, a trend that has persisted so far throughout the volatility of chartering rates. We believe that the strong demand for commodities, which is evidenced from stable or increasing prices among iron ore, coal, steel, and grain coupled with increased ton-mile demand from pockets of strong growth such as US Gulf, South America and India will improve vessels utilization and substantially increase rates. We feel that we are well positioned to take advantage of the current volatile dry bulk market."

Discussion on Recent Market Conditions

Mr. Varouxakis continued, "While the fourth quarter of the year saw weakened rates in the dry bulk sector due to an unprecedented combination of floods in Australian leading to the closure of most exporting ports there, a strong dollar caused by Eurozone weakness, temporary subdued demand from China, and the stalling of iron ore exports out of India due to local regulatory issues, we saw throughout the year overall healthy rates for Handysize and Handymax vessels. We expect to see continued volatility in rates throughout the coming year and, using our spot strategy, expect to take advantage of seasonal peaks such as, for example, the grain season in the spring which is expected to lead to increased demand for our vessels. In the last couple of years, Handysize vessels have been outperforming other asset classes during most periods of rate weakness, a trend we expect to continue."

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