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What changed in Pangaea Logistics Solutions Ltd.'s 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of Pangaea Logistics Solutions Ltd.'s 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+519 added−332 removedSource: 10-K (2024-03-14) vs 10-K (2023-03-15)

Top changes in Pangaea Logistics Solutions Ltd.'s 2023 10-K

519 paragraphs added · 332 removed · 268 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

98 edited+204 added−27 removed163 unchanged
Biggest changeAny passage of climate control legislation or other regulatory initiatives by the IMO, European Union, the U.S. or other countries where the Company operates, or any treaty adopted at the international level to succeed the Kyoto Protocol, that restrict emissions of greenhouse gases could require the Company to make significant financial expenditures which the Company cannot predict with certainty at this time. 18 Vessel Security Regulations Since the terrorist attacks of September 11, 2001 in the United States, there have been a variety of initiatives intended to enhance vessel security such as the Maritime Transportation Security Act of 2002, or MTSA.
Biggest changeAny passage of climate control legislation or other regulatory initiatives by the IMO, the EU, the U.S. or other countries where we operate, or any treaty adopted at the international level to succeed the Kyoto Protocol or Paris Agreement, that restricts emissions of greenhouse gases could require us to make significant financial expenditures which we cannot predict with certainty at this time.
OPA defines these other damages broadly to include: 15 • injury to, destruction or loss of, or loss of use of, natural resources and related assessment costs; • injury to, or economic losses resulting from, the destruction of real and personal property; • net loss of taxes, royalties, rents, fees or net profit revenues resulting from injury, destruction or loss of real or personal property, or natural resources; • loss of subsistence use of natural resources that are injured, destroyed or lost; • lost profits or impairment of earning capacity due to injury, destruction or loss of real or personal property or natural resources; and • net cost of increased or additional public services necessitated by removal activities following a discharge of oil, such as protection from fire, safety or health hazards, and loss of subsistence use of natural resources.
OPA defines these other damages broadly to include: • injury to, destruction or loss of, or loss of use of, natural resources and related assessment costs; • injury to, or economic losses resulting from, the destruction of real and personal property; • net loss of taxes, royalties, rents, fees or net profit revenues resulting from injury, destruction or loss of real or personal property, or natural resources; • loss of subsistence use of natural resources that are injured, destroyed or lost; • lost profits or impairment of earning capacity due to injury, destruction or loss of real or personal property or natural resources; and • net cost of increased or additional public services necessitated by removal activities following a discharge of oil, such as protection from fire, safety or health hazards, and loss of subsistence use of natural resources.
The limitation on liability similarly does not apply if the responsible party fails or refuses to (i) report the incident where the responsibility party knows or has reason to know of the incident; (ii) reasonably cooperate and assist as requested in connection with oil removal activities; or (iii) without sufficient cause, comply with an order issued under the Federal Water Pollution Act (Section 311 (c), (e)) or the Intervention on the High Seas Act.
The limitation on liability similarly does not apply if the responsible party fails or refuses to (i) report the incident where the responsibility party knows or has reason to know of the incident; (ii) reasonably cooperate and assist as requested in 19 connection with oil removal activities; or (iii) without sufficient cause, comply with an order issued under the Federal Water Pollution Act (Section 311 (c), (e)) or the Intervention on the High Seas Act.
The Company also believes that this combination of owned and chartered-in vessels helps it to more efficiently match its customer demand than the Company could with only owned vessels or an entirely chartered-in fleet. 8 Corporate Structure The Company is a holding company incorporated under the laws of Bermuda as an exempted company on April 29, 2014.
The Company also believes that this combination of owned and chartered-in vessels helps it to more efficiently match its customer demand than the Company could with only owned vessels or an entirely chartered-in fleet. Corporate Structure The Company is a holding company incorporated under the laws of Bermuda as an exempted company on April 29, 2014.
We manage market risk by chartering in vessels for periods of less than nine months on average and through a portfolio approach based upon owned vessels, chartered-in vessels, COAs, voyage charters, and time charters. The Company tries to identify routes and ports for efficient bunkering to minimize its fuel expense.
We manage market risk by chartering in vessels for periods of less than nine months on average and 5 through a portfolio approach based upon owned vessels, chartered-in vessels, COAs, voyage charters, and time charters. The Company tries to identify routes and ports for efficient bunkering to minimize its fuel expense.
VIDA establishes a new framework for the regulation of vessel incidental discharges under Clean Water Act (CWA), requires the EPA to develop performance standards for those discharges within two years of enactment, and requires the U.S. Coast Guard to develop implementation, compliance, and enforcement regulations within two years of EPA’s promulgation of standards.
VIDA establishes a new framework for the regulation of vessel incidental discharges under Clean Water Act (CWA), requires the EPA to develop 20 performance standards for those discharges within two years of enactment, and requires the U.S. Coast Guard to develop implementation, compliance, and enforcement regulations within two years of EPA’s promulgation of standards.
OPA, which imposes virtually unlimited liability for certain oil 20 pollution accidents upon owners, operators and demise charterers of vessels trading in the United States exclusive economic zone, has made liability insurance more expensive for ship owners and operators trading in the U.S. market.
OPA, which imposes virtually unlimited liability for certain oil pollution accidents upon owners, operators and demise charterers of vessels trading in the United States exclusive economic zone, has made liability insurance more expensive for ship owners and operators trading in the U.S. market.
MEPC 75 also approved draft amendments to MARPOL Annex I to prohibit the use and carriage for use as fuel of heavy fuel oil by ships in Arctic waters on and after July 1, 2024.
MEPC 75 also approved draft amendments to MARPOL Annex I to prohibit the use and carriage for use as fuel of heavy fuel oil (“HFO”) by ships in Arctic waters on and after July 1, 2024.
Under time charters, including trip charters, the charterer pays all voyage expenses including port, canal and bunker (fuel) costs. • Trip Charter. A time charter for a trip to carry a specific cargo from a load port to a discharge port at a set daily rate. • Voyage Charter .
Under time charters, including trip charters, the charterer pays all voyage expenses including port, canal and bunker (fuel) costs. 26 • Trip Charter. A time charter for a trip to carry a specific cargo from a load port to a discharge port at a set daily rate. • Voyage Charter .
As the Company expands its operations to ports and terminals, it becomes more exposed to environmental requirements and regulations ashore. 12 International Maritime Organization The United Nations’ International Maritime Organization, or the IMO, has adopted the International Convention for the Prevention of Marine Pollution from Ships, 1973, as modified by the Protocol of 1978 relating thereto, collectively referred to as MARPOL 73/78 and herein as “MARPOL,” the International Convention for the Safety of Life at Sea of 1974 ("SOLAS Convention"), and the International Convention on Load Lines of 1966 (the "LL Convention").
As the Company expands its operations to ports and terminals, it becomes more exposed to environmental requirements and regulations ashore. 13 International Maritime Organization The United Nations’ International Maritime Organization, or the IMO, has adopted the International Convention for the Prevention of Marine Pollution from Ships, 1973, as modified by the Protocol of 1978 relating thereto, collectively referred to as MARPOL 73/78 and herein as “MARPOL,” the International Convention for the Safety of Life at Sea of 1974 ("SOLAS Convention"), and the International Convention on Load Lines of 1966 (the "LL Convention").
The ship operator receives payment based on a price per ton of cargo loaded on board the 22 vessel. The ship operator is responsible for the payment of all voyage expenses, as well as the costs of owning or hiring the vessel. • Contract of Affreightment.
The ship operator receives payment based on a price per ton of cargo loaded on board the vessel. The ship operator is responsible for the payment of all voyage expenses, as well as the costs of owning or hiring the vessel. • Contract of Affreightment.
In addition, there is an inherent possibility of marine disaster, including oil spills (e.g. fuel oil) and other environmental incidents, and the liabilities arising from owning and operating vessels in international trade.
In addition, there is an inherent possibility of marine disaster, including oil spills (e.g. fuel oil) and other environmental incidents, and the liabilities 24 arising from owning and operating vessels in international trade.
The Company believes its active risk management allows it to reduce the sensitivity of its revenues to market fluctuations and helps it to secure its long-term profitability and lower relative 4 volatility of earnings.
The Company believes its active risk management allows it to reduce the sensitivity of its revenues to market fluctuations and helps it to secure its long-term profitability and lower relative volatility of earnings.
The amendments include (1) a technical requirement to reduce carbon intensity based on a new Energy Efficiency Existing Ship Index (“EEXI”), and (2) operational carbon intensity reduction requirements, based on a new operational carbon intensity indicator (“CII”).
The requirements include (1) a technical requirement to reduce carbon intensity based on a new Energy Efficiency Existing Ship Index (“EEXI”), and (2) operational carbon intensity reduction requirements, based on a new operational carbon intensity indicator (“CII”).
Business overview and Recent Developments The Company provides logistics and transportation services to clients utilizing an ocean-going fleet of motor vessels ("m/v") in the Handymax, Supramax, Ultramax and Panamax segments. At any time, this fleet may be comprised of a total of 45-60 vessels that are owned or chartered-in on a short-term basis.
Business overview and Recent Developments The Company provides ocean transportation services to clients utilizing an ocean-going fleet of motor vessels ("m/v") in the Handymax, Supramax, Ultramax and Panamax and Post-Panamax segments. At any time, this fleet may be comprised of a total of 45-60 vessels that are owned or chartered-in on a short-term basis.
The Company believes that shorter-term charters afford it flexibility to match its variable costs to its customers’ service requirements and to respond quickly to market volatility.
The Company believes that shorter-term charters afford it flexibility to match its variable costs to its customers’ service requirements and to respond quickly to market 9 volatility.
The Company believes it operates assets well suited to certain of these routes, including its Ice- 5 Class 1A Panamax, Post Panamax Ice Class 1A and Ice-Class 1C Ultramax vessels. The ice-class fleet has historically produced margins that are superior to the average market rate. • Enhanced vessel utilization and profitability through strategic backhaul and triangulation methods.
The Company believes it operates assets well suited to certain of these routes, including its Ice- 6 Class 1A Panamax, Post Panamax Ice Class 1A and Ice-Class 1C Ultramax vessels. The ice-class fleet has historically produced margins that are superior to the average market rate. • Enhanced vessel utilization and profitability through strategic backhaul and triangulation methods.
Other members of its management team, Mads Boye Petersen and Gianni Del Signore, also have extensive experience in the shipping industry. The Company believes its management team and key employees are well respected in the drybulk sector of the shipping industry 6 and, over the years, has developed strong commercial relationships with industrial customers and lenders.
Other members of its management team, Mads Boye Petersen and Gianni Del Signore, also have extensive experience in the shipping industry. The Company believes its management team and key employees are well respected in the drybulk sector of the shipping industry 7 and, over the years, has developed strong commercial relationships with industrial customers and lenders.
The Company typically has more crew members on board than are required by the country of the vessel’s flag in order to allow for the performance of routine maintenance duties. The Company employs approximately 70 shore-based personnel and has approximately 500 independently contracted seagoing personnel on its owned vessels.
The Company typically has more crew members on board than are required by the country of the vessel’s flag in order to allow for the performance of routine maintenance duties. The Company employs approximately 151 shore-based personnel and has approximately 500 independently contracted seagoing personnel on its owned vessels.
Additional laws and regulations, environmental or otherwise, may be adopted which could limit its ability to do business or increase the cost of doing business. 11 Environmental and Other Regulations Government regulation and laws significantly affect the ownership and operation of the Company's vessels.
Additional laws and 12 regulations, environmental or otherwise, may be adopted which could limit its ability to do business or increase the cost of doing business. Environmental and Other Regulations Government regulation and laws significantly affect the ownership and operation of the Company's vessels.
Most vessels undergo regulatory inspection of the underwater parts every 30 to 36 months. If any defects are found, the classification surveyor will issue a recommendation which must be rectified by the ship owner within prescribed time limits. The Company expects to perform two special surveys in 2023 at an aggregate total cost of approximately $2.7 million.
Most vessels undergo regulatory inspection of the underwater parts every 30 to 36 months. If any defects are found, the classification surveyor will issue a recommendation which must be rectified by the ship owner within prescribed time limits. The Company expects to perform two special surveys in 2024 at an aggregate total cost of approximately $2.0 million.
Transparency is an important step toward sustainability in our industry and we were pleased to present our second concise Environmental, Social and Governance (ESG) report based on the Marine Transportation framework developed by the Sustainability Accounting Standards Board (SASB) during 2022. More specifically over the past several years we have taken steps to integrate ESG into operations, including: 1.
Transparency is an important step toward sustainability in our industry and we were pleased to present our third concise Environmental, Social and Governance (ESG) report based on the Marine Transportation framework developed by the Sustainability Accounting Standards Board (SASB) during 2023. More specifically over the past several years we have taken steps to integrate ESG into operations, including: 1.
Among the various requirements are: • on-board installation of automatic identification systems to provide a means for the automatic transmission of safety-related information from among similarly equipped ships and shore stations, including information on a ship’s identity, position, course, speed and navigational status; • on-board installation of ship security alert systems, which do not sound on the vessel but only alert the authorities on shore; • the development of vessel security plans; • ship identification number to be permanently marked on a vessel’s hull; • a continuous synopsis record kept onboard showing a vessel’s history including the name of the ship, the state whose flag the ship is entitled to fly, the date on which the ship was registered with that state, the ship’s identification number, the port at which the ship is registered and the name of the registered owner(s) and their registered address; and • compliance with flag state security certification requirements.
The various requirements, some of which are found in the SOLAS Convention, include, for example, on-board installation of automatic identification systems to provide a means for the automatic transmission of safety-related information from among similarly equipped ships and shore stations, including information on a ship’s identity, position, course, speed and navigational status; on-board installation of ship security alert systems, which do not sound on the vessel but only alert the authorities on shore; the development of vessel security plans; ship identification number to be permanently marked on a vessel’s hull; a continuous synopsis record kept onboard showing a vessel's history including the name of the ship, the state whose flag the ship is entitled to fly, the date on which the ship was registered with that state, the ship's identification number, the port at which the ship is registered and the name of the registered owner(s) and their registered address; and compliance with flag state security certification requirements.
In addition, the Company intends to comply with all future applicable state regulations in the ports where its vessels call. Other Environmental Initiatives The U.S.
In addition, the Company intends to comply with all future applicable state regulations in the ports where its vessels call. Other United States Environmental Initiatives The U.S.
In December 2021, the member states of the Convention for the Protection of the Mediterranean Sea Against Pollution (the "Barcelona Convention") agreed to support the designation of a new ECA in the Mediterranean Sea. On December 15, 2022, MEPC 79 adopted the designation of a new ECA in the Mediterranean Sea, with an effective date of May 1, 2025.
In December 2021, the member states of the Convention for the Protection of the Mediterranean Sea Against Pollution (the “Barcelona Convention”) agreed to support the designation of a new ECA in the Mediterranean. On December 15, 2022, MEPC 79 adopted the designation of a new ECA in the Mediterranean, with an effective date of May 1, 2025.
The current fleet includes six Ice-Class 1A Panamax, four Post Panamax Ice Class 1A, three Panamax, two Ultramax Ice Class 1C, one Ultramax and eight Supramax drybulk vessels. • Increase backhaul focus, expand and defend its presence in the niche ice trades and increase fleet efficiency.
The current fleet includes six Ice-Class 1A Panamax, four Post Panamax Ice Class 1A, three Panamax, two Ultramax Ice Class 1C, two Ultramax and seven Supramax drybulk vessels. • Increase backhaul focus, expand and defend its presence in the niche ice trades and increase fleet efficiency.
All of these vessels are time chartered to NBC, a wholly-owned subsidiary of the Company, at fixed rates and also have a profit share arrangement. NBC commercially operates these vessels in spot and COA trades.
All of these vessels are time chartered to Pangaea Denmark, a wholly-owned subsidiary of the Company, at fixed rates and also have a profit share arrangement. Pangaea Denmark commercially operates these vessels in spot and COA trades.
On December 18, 2022, the Environmental Council and European Parliament agreed to include maritime shipping emissions within the scope of the EU ETS on a gradual introduction of obligations for shipping companies to surrender allowances: 40% for verified emissions from 2024, 70% for 2025 and 100% for 2026.
On December 18, 2022, the Environmental Council and European Parliament agreed to include maritime shipping emissions within the scope of the EU ETS on a gradual introduction of obligations for shipping companies to surrender allowances equivalent to a portion of their carbon emissions: 40% for verified emissions from 2024, 70% for 2025 and 100% for 2026.
The Company addresses the logistics needs of its customers by undertaking a comprehensive set of services and activities, including cargo loading, cargo discharge, vessel chartering, voyage planning, and vessel technical management.
The Company addresses the logistics needs of its customers by undertaking a comprehensive set of services and activities, including cargo loading, cargo discharge, port and terminal operations, vessel chartering, voyage planning, and vessel technical management.
To further expand its customer base and potential cargoes, the Company has developed expertise in servicing ports and routes subject to severe ice conditions, including the Baltic Sea and the Northern Sea Route. 7 As of March 15, 2023, the Company operates its fleet of 24 owned or partially owned vessels, which are described in the table below: Vessel Name Type DWT Year Built Yard m/v Bulk Endurance Ultramax (Ice Class 1C) 59,450 2017 Oshima Shipbuilding m/v Bulk Destiny Ultramax (Ice Class 1C) 59,450 2017 Oshima Shipbuilding m/v Nordic Oasis Panamax (Ice Class 1A) 76,180 2016 Oshima Shipbuilding m/v Nordic Olympic Panamax (Ice Class 1A) 76,180 2015 Oshima Shipbuilding m/v Nordic Odin Panamax (Ice Class 1A) 76,180 2015 Oshima Shipbuilding m/v Nordic Oshima Panamax (Ice Class 1A) 76,180 2014 Oshima Shipbuilding m/v Nordic Orion Panamax (Ice Class 1A) 75,603 2011 Oshima Shipbuilding m/v Nordic Odyssey Panamax (Ice Class 1A) 75,603 2010 Oshima Shipbuilding m/v Bulk Friendship Supramax 58,738 2011 Nantong Cosco Kawasaki HI m/v Bulk Sachuest Supramax 55,618 2010 Hyundai Vinashin m/v Bulk Independence Supramax 56,548 2008 Yokohama m/v Bulk Pride Supramax 58,749 2008 Tsuneishi Group (Zhoushan) Shipbuilding Inc. m/v Bulk Trident Supramax 52,514 2006 Tsuneishi Heavy Industries (Cebu) m/v Bulk Freedom Supramax 52,454 2005 Tsuneishi Shipbuilding Co.
To further expand its customer base and potential cargoes, the Company has developed expertise in servicing ports and routes subject to severe ice conditions, including the Baltic Sea and the Northern Sea Route. 8 As of March 14, 2024, the Company operates its fleet of 24 owned or partially owned vessels, which are described in the table below: Vessel Name Type DWT Year Built Yard m/v Bulk Endurance Ultramax (Ice Class 1C) 59,450 2017 Oshima Shipbuilding m/v Bulk Destiny Ultramax (Ice Class 1C) 59,450 2017 Oshima Shipbuilding m/v Nordic Oasis Panamax (Ice Class 1A) 76,180 2016 Oshima Shipbuilding m/v Nordic Olympic Panamax (Ice Class 1A) 76,180 2015 Oshima Shipbuilding m/v Nordic Odin Panamax (Ice Class 1A) 76,180 2015 Oshima Shipbuilding m/v Nordic Oshima Panamax (Ice Class 1A) 76,180 2014 Oshima Shipbuilding m/v Nordic Orion Panamax (Ice Class 1A) 75,603 2011 Oshima Shipbuilding m/v Nordic Odyssey Panamax (Ice Class 1A) 75,603 2010 Oshima Shipbuilding m/v Bulk Valor Supramax 58,105 2013 Tsuneishi Heavy Industries (Cebu) m/v Bulk Friendship Supramax 58,738 2011 Nantong Cosco Kawasaki HI m/v Bulk Sachuest Supramax 55,618 2010 Hyundai Vinashin m/v Bulk Spirit Supramax 52,950 2009 Oshima Shipbuilding m/v Bulk Independence Supramax 56,548 2008 Yokohama m/v Bulk Pride Supramax 58,749 2008 Tsuneishi Group (Zhoushan) Shipbuilding Inc. m/v Bulk Freedom Supramax 52,454 2005 Tsuneishi Shipbuilding Co.
Additionally, MEPC 75 proposed draft amendments requiring that, on or before January 1, 2023, all ships above 400 gross tonnage must have an approved Ship Energy Efficiency Management Plan, or SEEMP, on board. For ships above 5,000 gross tonnage, the SEEMP would need to include certain mandatory content.
Additionally, MEPC 75 proposed draft amendments requiring that, on or before January 1, 2023, all ships above 400 gross tonnage must have an approved SEEMP on board. For ships above 5,000 gross tonnage, the SEEMP would need to include certain mandatory content.
Ltd m/v Bulk Xaymaca (1) Panamax 76,561 2006 Imabari SB Marugame m/v Bulk Promise Panamax 78,228 2013 Shin Kurushima Toyohashi Shipbuilding Company Limited Nordic Nuluujaak Post Panamax (Ice Class 1A) 95,000 2021 Guangzhou Shipyard International Company Limited Nordic Qinngua Post Panamax (Ice Class 1A) 95,000 2021 Guangzhou Shipyard International Company Limited Nordic Sanngijuq Post Panamax (Ice Class 1A) 95,000 2021 Guangzhou Shipyard International Company Limited Nordic Siku Post Panamax (Ice Class 1A) 95,000 2021 Guangzhou Shipyard International Company Limited (1) Formerly known as m/v Bulk PODS The Company owns its vessels through separate wholly-owned subsidiaries and through joint venture entities with other owners, which the Company consolidates as variable interest entities in its consolidated financial statements.
Ltd m/v Bulk Xaymaca (1) Panamax 76,561 2006 Imabari SB Marugame m/v Nordic Nuluujaak Post Panamax (Ice Class 1A) 95,000 2021 Guangzhou Shipyard International Company Limited m/v Nordic Qinngua Post Panamax (Ice Class 1A) 95,000 2021 Guangzhou Shipyard International Company Limited m/v Nordic Sanngijuq Post Panamax (Ice Class 1A) 95,000 2021 Guangzhou Shipyard International Company Limited m/v Nordic Siku Post Panamax (Ice Class 1A) 95,000 2021 Guangzhou Shipyard International Company Limited (1) Formerly known as m/v Bulk PODS The Company owns its vessels through separate wholly-owned subsidiaries and through joint venture entities with other owners, which the Company consolidates as variable interest entities in its consolidated financial statements.
(P) This entity is the technical manager of 14 vessels owned and operated by the Company. (Q) The primary purpose of the company is to manage and operate the Brayton Point Commerce Center Marine Terminal. (R) The primary purpose of the company is to manage and operate a port terminal in Louisiana.
(P) This entity is the technical manager of 14 vessels owned and operated by the Company. (Q) The primary purpose of the company is to manage and operate the Brayton Point Commerce Center Marine Terminal. (R) The primary purpose of the company is to manage and operate port terminals.
The most common are time charters, spot charters, and voyage charters. Historically, charter rates have been volatile as they are driven by the underlying balance between vessel supply and demand. Ice class vessels, when operating in ice-bound areas, usually command a rate premium to conventional trades.
Historically, charter rates have been volatile as they are driven by the underlying balance between vessel supply and demand. Ice class vessels, when operating in ice-bound areas, usually command a rate premium to conventional trades.
The Company expects to perform three intermediate surveys in 2023 at an aggregate total cost of approximately $0.4 million. The Company estimates that offhire related to the surveys and related repair work is ten to twenty days per vessel, depending on the size and condition of the vessel.
The Company expects to perform four intermediate surveys in 2024 at an aggregate total cost of approximately $0.3 million. The Company estimates that offhire related to the surveys and related repair work is ten to twenty days per vessel, depending on the size and condition of the vessel.
The Bunker Convention requires registered owners of ships over 1,000 gross tons 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).
The Bunker Convention requires registered owners of ships over 1,000 gross tons 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 LLMC).
The Company is a leader in the high ice class sector, secured by its control of a majority of the world's large (over 60,000 DWT) dry bulk vessels with Ice-Class 1A designation. High ice class trading includes service in ice-restricted areas in the Northern Hemisphere during both the winter (Baltic Sea and Gulf of St. Lawrence) and summer (Arctic Ocean).
The Company is a leader in the high ice class sector, supported by its operation of the world's largest fleet of dry bulk vessels over 60,000 dwt with Ice-Class 1A designation. High ice class trading includes service in ice-restricted areas in the Northern Hemisphere during both the winter (Baltic Sea and Gulf of St. Lawrence) and summer (Arctic Ocean).
("Bulk Sachuest") Marshall Islands 100% (G) Venture Logistics NL Inc. ("VLNL") Canada 50% (N) Flintstone Ventures Limited ("FVL") Newfoundland and Labrador 100% (O) Seamar Management S.A. Greece 51% (P) Bulk PODS Ltd. ("Bulk PODS") Marshall Islands 100% (G) Bulk Spirit Ltd. ("Bulk Spirit") Marshall Islands 100% (G) Nordic Bulk Carriers Singapore Pte. Ltd.
("Bulk Sachuest") Marshall Islands 100% (G) Bulk Prudence Corp. ("Bulk Prudence") Marshall Islands 100% (G) Venture Logistics NL Inc. ("VLNL") Canada 50% (N) Flintstone Ventures Limited ("FVL") Newfoundland and Labrador 100% (O) Seamar Management S.A. Greece 51% (P) Bulk PODS Ltd. ("Bulk PODS") Marshall Islands 100% (G) Bulk Spirit Ltd.
ITEM 1. BUSINESS Introduction Pangaea Logistics Solutions Ltd. and its subsidiaries (collectively, “Pangaea” or the “Company”) provides seaborne drybulk logistics and transportation services.
ITEM 1. BUSINESS Introduction Pangaea Logistics Solutions Ltd. and its subsidiaries (collectively, “Pangaea” or the “Company”) provides seaborne drybulk logistics and transportation services as well as terminal and stevedoring services.
The Company currently controls (owns or has an ownership interest in) a fleet of 24 bulk carriers as of March 15, 2023.
The Company currently controls (owns or has an ownership interest in) a fleet of 24 bulk carriers as of March 14, 2024.
During 2022, the Company operated 26 vessels which were wholly-owned or partially-owned through joint ventures. The Company uses this fleet to transport approximately 23 million tons of cargo annually to nearly 250 ports around the world, averaging approximately 49 vessels in service daily in 2022 and 55 during 2021.
During 2023, the Company operated 26 vessels which were wholly-owned or partially-owned through joint ventures. The Company uses this fleet to transport approximately 22 million tons of cargo annually to nearly 225 ports around the world, averaging approximately 46 vessels in service daily in 2023 and 49 during 2022.
The ISM Code requires that vessel operators obtain a safety management certificate, or SMC, for each vessel they operate. This certificate evidences compliance by a vessel’s operators with the ISM Code requirements for an SMS.
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 the ISM Code requirements for a safety management system.
In addition, the Company focuses on fixing cargo and cargo contracts for transportation on backhaul routes. Backhaul routes position vessels for cargo discharge in typical loading areas. Backhaul routes allow us to reduce ballast days and instead earn revenues at times and on routes that are typically traveled without paying cargo.
Backhaul routes position vessels for cargo discharge in typical loading areas. Backhaul routes allow us to reduce ballast days and instead earn revenues at times and on routes that are typically traveled without paying cargo.
Singapore 100% (H) Narragansett Bulk Carriers (US) Corp. Rhode Island 100% (H) Patriot Stevedoring & Logistics, LLC Massachusetts 50% (Q) Bay Stevedoring LLC Delaware 100% (R) Pangaea Logistics Solutions (US) LLC Delaware 100% (S) (A) The primary purpose of this corporation is to manage and operate ocean going vessels.
Rhode Island 100% (H) Patriot Stevedoring & Logistics, LLC Massachusetts 50% (Q) Bay Stevedoring LLC Delaware 100% (R) Pangaea Logistics Solutions (US) LLC ("PANL US") Delaware 100% (S) Pangaea Baltimore LLC Delaware 100% (R) Pangaea Port Everglades LLC Delaware 100% (R) (A) The primary purpose of this corporation is to manage and operate ocean going vessels.
MEPC 79 also adopted amendments to MARPOL Annex VI, Appendix IX to include the attained and required CII values, the CII rating and attained EEXI for existing ships in the required information to be submitted to the IMO Ship Fuel Oil Consumption Database. The amendments will enter into force on May 1, 2024.
MEPC 79 adopted amendments to MARPOL Annex VI, Appendix IX to include the attained and required CII values, the CII rating and attained EEXI for existing ships in the required information to be submitted to the IMO Ship Fuel Oil Consumption Database.
This might cause companies to create additional procedures for monitoring cybersecurity, which could require additional expenses and/or capital expenditures. The impact of such regulations is hard to predict at this time. 14 The IMO continues to review and introduce new regulations.
This might cause companies to create additional procedures for monitoring cybersecurity, which could require additional expenses and/or capital expenditures. The impact of future regulations is hard to predict at this time.
The Company’s core offering is the safe, reliable, and timely loading, carriage, and discharge of cargoes for customers. This offering requires identifying customers, agreeing on the terms of service, selecting a vessel to undertake the voyage, working with port personnel to load and discharge cargo, and documenting the transfers of title upon loading or discharge of the cargo.
This offering requires identifying customers, agreeing on the terms of service, selecting a vessel to undertake the voyage, working with port personnel to load and discharge cargo, and documenting the transfers of title upon loading or discharge of the cargo.
The Company’s corporate website address is http://www.pangaeals.com . 9 As of March 15, 2023, the Company’s significant subsidiaries are as follows: Company Name Country of Organization Proportion of Ownership Interest Americas Bulk Transport (BVI) Limited British Virgin Islands 100% (A) Phoenix Bulk Management Bermuda Limited Bermuda 100% (B) Phoenix Bulk Carriers (BVI) Limited (“PBC”) British Virgin Islands 100% (C) Bulk Ocean Shipping Company (Bermuda) Ltd.
The Company’s corporate website address is http://www.pangaeals.com . 10 As of March 14, 2024, the Company’s significant subsidiaries are as follows: Company Name Country of Organization Proportion of Ownership Interest Americas Bulk Transport (BVI) Limited British Virgin Islands 100% (A) Phoenix Bulk Management Bermuda Limited Bermuda 100% (B) Pangaea Logistics Solutions (BVI) Limited (“Pangaea BVI”) British Virgin Islands 100% (C) Bulk Ocean Shipping Company (Bermuda) Ltd.
(E) The primary purpose of this corporation is to act as the U.S. administrative agent for the Company. (F) The primary purpose of this corporation is to act as the treasury agent for the Company.
(D) The primary purpose of this corporation is to manage the fuel procurement for all vessels. (E) The primary purpose of this corporation is to act as the U.S. administrative agent for the Company. (F) The primary purpose of this corporation is to act as the treasury agent for the Company.
The Company’s ocean logistics services provide cargo loading, cargo discharge, vessel chartering, voyage planning, and technical vessel management to vessel and cargo owners. Our logistics capabilities provide a wide array of services which allow our customers to extend their own services, to more efficiently transport their cargo, and to extend relationships with their own suppliers and customers.
The Company’s port, projects, and logistics services include cargo loading, cargo discharge, and port and terminal services to vessel and cargo owners. Our logistics capabilities provide a wide array of services which allow our customers to extend their own services, to more efficiently transport their cargo, and to extend relationships with their own suppliers and customers.
(“NBHC”) Bermuda 67% (L) Bulk Courageous Corp. ("Bulk Courageous") Marshall Islands 100% (G) Bulk Phoenix Ltd. ("Bulk Newport") Bermuda 100% (G) Bulk Valor Corp. ("Bulk Valor") Marshall Islands 100% (G) Bulk Promise Corp. ("Bulk Promise") Marshall Islands 100% (G) Bulk Nordic Five Ltd. (“Five”) Bermuda 100% (G) Bulk Nordic Six Ltd.
("Bulk Newport") Bermuda 100% (G) Bulk Valor Corp. ("Bulk Valor") Marshall Islands 100% (G) Bulk Promise Corp. ("Bulk Promise") Marshall Islands 100% (G) Bulk Nordic Five Ltd. (“Five”) Bermuda 100% (G) Bulk Nordic Six Ltd.
Furthermore, recent action by the IMO’s Maritime Safety Committee and United States agencies indicates that cybersecurity regulations for the maritime industry are likely to be further developed in the near future in an attempt to combat cybersecurity threats. For example, cyber-risk management systems must be incorporated by ship-owners and managers by 2021.
Furthermore, recent action by the IMO’s Maritime Safety Committee and United States agencies indicates that cybersecurity regulations for the maritime industry are likely to be further developed in the near future in an attempt to combat cybersecurity threats.
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 a valid ISSC that attests to the vessel's compliance with SOLAS security requirements and the ISPS Code.
The USCG regulations, intended to align with international maritime security standards, exempt non-U.S. vessels from MTSA vessel security measures, provided such vessels have on board a valid ISSC that attests to the vessel’s compliance with the SOLAS Convention security requirements and the ISPS Code. Future security measures could have a significant financial impact on us.
The failure of a ship owner to comply with the ISM Code may subject such party to increased liability, may decrease available insurance coverage for the affected vessels and may result in a denial of access to, or detention in, certain ports. As of the date of this filing, each of its vessels is ISM code-certified.
The failure of a vessel owner or bareboat charterer to comply with the ISM Code may subject such party to increased liability, may decrease available insurance coverage for the affected vessels and may result in a denial of access to, or detention in, certain ports.
However, there can be no assurance that such certificate will be maintained. International Code for Ships Operating in Polar Waters The IMO in November 2014 adopted the International Code for Ships Operating in Polar Waters (the “Polar Code”), and related amendments to the International Convention for the Safety of Life at Sea (“SOLAS”) to make it mandatory.
International Code for Ships Operating in Polar Waters The IMO in November 2014 adopted the International Code for Ships Operating in Polar Waters (the “Polar Code”), and related amendments to the International Convention for the Safety of Life at Sea (“SOLAS”) to make it mandatory.
The proposed rule would reduce 41 million tons of methane emissions between 2023 and 2035 and cut methane emissions in the oil and gas sector by approximately 74 percent compared to emissions from this sector in 2005.
The proposed rule would reduce 41 million tons of methane emissions between 2023 and 2035 and cut methane emissions in the oil 22 and gas sector by approximately 74 percent compared to emissions from this sector in 2005. EPA issued a supplemental proposed rule in November 2022 to include additional methane reduction measures.
For some customers, the Company acts as their ocean logistics department, providing scheduling, terminal operations, port services, and marketing functions. For other customers, the Company transports supplies used in mining or processing in addition to cargo transport. The Company has worked with other customers on design, construction, and operation of loading and discharge facilities.
For some customers, the Company acts as their ocean logistics department, providing scheduling, terminal operations, port services, and marketing functions. The Company has worked with other customers on design, construction, and operation of loading and discharge facilities. In addition, the Company focuses on fixing cargo and cargo contracts for transportation on backhaul routes.
In 2021, the Company owned interests in 24 vessels and chartered in another 213 for one or more voyages. The Company generally charters in third-party vessels for periods of less than nine months and, in most cases, less than six months. Chartered-in contracts are negotiated through third-party brokers, who are paid commission on a percentage of charter cost.
The Company g enerally charters in third-party vessels for periods of less than nine months and, in most cases, less than six months. Chartered-in contracts are negotiated through third-party brokers, who are paid commission on a percentage of charter cost.
(G) The primary purpose of these entities is owning bulk carriers. 10 (H) The primary purpose of these entities is to provide logistics services to customers by chartering, managing and operating ships. NBV is the holding company of NBC.
(G) The primary purpose of these entities is owning bulk carriers. (H) The primary purpose of these entities is to provide logistics services to customers by chartering, managing and operating ships. NBV is the holding company of Pangaea Denmark. F ormerly known as Nordic Bulk Carriers A/S.
With respect to non-ratifying states, liability for spills or releases of oil carried as fuel in ship’s bunkers typically is determined by the national or other domestic laws in the jurisdiction where the events or damages occur.
With respect to non-ratifying states, liability for spills or releases of oil carried as fuel in ship’s bunkers typically is determined by the national or other domestic laws in the jurisdiction where the events or damages occur. Ships are required to maintain a certificate attesting that they maintain adequate insurance to cover an incident.
Notwithstanding the recording of any such special capacity, the Company is not bound to investigate or incur any responsibility in respect of the proper administration of any such estate or trust. The Company will take no notice of any trust applicable to any of its shares or other securities whether or not the Company had notice of such trust.
Notwithstanding the recording of any such special capacity, the Company is not bound to investigate or incur any responsibility in respect of the proper administration of any such estate or trust.
The directive applies to all types of vessels, irrespective of their flag, but certain exceptions apply to warships or where human safety or that of the ship is in danger.
Aiding and abetting the discharge of a polluting substance may also lead to criminal penalties. The directive applies to all types of vessels, irrespective of their flag, but certain exceptions apply to warships or where human safety or that of the ship is in danger.
These regulations subject ocean-going vessels to stringent emissions controls, and may cause us to incur substantial costs, including those related to the purchase, installation and operation of scrubbers and the purchase of compliant fuel oil.
These regulations subject ocean-going vessels to stringent emissions controls, and may cause us to incur substantial costs, including those related to the purchase, installation and operation of scrubbers and the purchase of compliant fuel oil. Sulfur content standards are even stricter within certain “Emission Control Areas,” or (“ECAs”).
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. The regulations also impose requirements on certain ports and facilities, some of which are regulated by the U.S. Environmental Protection Agency, or the EPA.
To implement certain portions of the MTSA, the USCG issued regulations requiring the implementation of certain security requirements aboard vessels operating in waters subject to the jurisdiction of the United States and at certain ports and facilities, some of which are regulated by the EPA.
(B) The primary purpose of this entity is to perform certain administrative management functions that have been assigned by PBC. (C) The primary purpose of this corporation is to provide logistics services to customers by chartering, managing and operating ships. (D) The primary purpose of this corporation is to manage the fuel procurement for all vessels.
(B) The primary purpose of this entity is to perform certain administrative management functions that have been assigned by PBC. 11 (C) The primary purpose of this corporation is to provide logistics services to customers by chartering, managing and operating ships. Formerly known as Phoenix Bulk Carriers (BVI) Limited.
(“Bulk Oshima”) Bermuda 67% (J) Bulk Nordic Odin (MI) Corp. (“Bulk Odin”) Bermuda 67% (J) Bulk Nordic Olympic (MI) Corp. (“Bulk Olympic”) Bermuda 67% (J) Bulk Nordic Oasis (MI) Corp.. (“Bulk Oasis”) Bermuda 67% (J) Bulk Nordic Odyssey Corp. (MI) Marshall Islands 67% (K) Bulk Nordic Orion Corp. (MI) Marshall Islands 67% (K) Nordic Bulk Holding Company Ltd.
(“Bulk Olympic”) Marshall Islands 67% (J) Bulk Nordic Oasis (MI) Corp.. (“Bulk Oasis”) Marshall Islands 67% (J) Bulk Nordic Odyssey Corp. (MI) Marshall Islands 67% (K) Bulk Nordic Orion Corp. (MI) Marshall Islands 67% (K) Nordic Bulk Holding Company Ltd. (“NBHC”) Bermuda 67% (L) Bulk Courageous Corp. ("Bulk Courageous") Marshall Islands 100% (G) Bulk Phoenix Ltd.
The Company relies upon the safety management system that the Company and its technical managers have developed for compliance with the ISM Code.
We rely upon the safety management system that we and our technical management team have developed for compliance with the ISM Code.
If the damages from a catastrophic spill were to exceed the Company’s insurance coverage it could have an adverse effect on its business and results of operation. 16 OPA specifically permits individual states to impose their own liability regimes with regard to oil pollution incidents occurring within their boundaries, provided they accept, at a minimum, the levels of liability established under OPA and some states have enacted legislation providing for unlimited liability for oil spills.
OPA specifically permits individual states to impose their own liability regimes with regard to oil pollution incidents occurring within their boundaries, provided they accept, at a minimum, the levels of liability established under OPA and some states have enacted legislation providing for unlimited liability for oil spills.
In the United States, the EPA has issued a finding that greenhouse gases endanger the public health and safety and has adopted regulations to limit greenhouse gas emissions from certain mobile sources and large stationary sources. On November 2, 2021, the EPA issued a proposed rule under the CAA designed to reduce methane emissions from oil and gas sources.
In the United States, the EPA issued a finding that greenhouse gases endanger the public health and safety, adopted regulations to limit greenhouse gas emissions from certain mobile sources, and proposed regulations to limit greenhouse gas emissions from large stationary sources. However, in March 2017, former U.S.
These amendments introduce requirements to assess and measure the energy efficiency of all ships and set the required attainment values, with the goal of reducing the carbon intensity of international shipping.
Additionally, MEPC 75 introduced draft amendments to Annex VI which impose new regulations to reduce greenhouse gas emissions from ships. These amendments introduce requirements to assess and measure the energy efficiency of all ships and set the required attainment values, with the goal of reducing the carbon intensity of international shipping.
The Company's current fleet of vessels are equipped with these systems. The IMO adopted the International Convention on Civil Liability for Bunker Oil Pollution Damage, or the Bunker Convention, to impose strict liability on ship owners for pollution damage in jurisdictional waters of ratifying states caused by discharges of bunker fuel.
The IMO also adopted the International Convention on Civil Liability for Bunker Oil Pollution Damage (the “Bunker Convention”) to impose strict liability on ship owners (including the registered owner, bareboat charterer, manager or operator) for pollution damage in jurisdictional waters of ratifying states caused by discharges of bunker fuel.
As of January 2020, EU member states must also ensure that ships in all EU waters, except the Emission Control Area, use fuels with a 0.5% maximum sulfur content. The Company does not expect that it will be required to modify any of its vessels to meet any of the foregoing low sulfur fuel requirements.
As of January 2020, EU member states must also ensure that ships in all EU waters, except the SOx-Emission Control Area, use fuels with a 0.5% maximum sulfur content.
For example, the IMO adopted the International Convention for the Control and Management of Ships’ Ballast Water and Sediments, or the BWM Convention, in February 2004. The BWM Convention's implementing regulations call for a phased introduction of mandatory ballast water exchange requirements, to be replaced in time with mandatory concentration limits.
The BWM Convention’s implementing regulations call for a phased introduction of mandatory ballast water exchange requirements, to be replaced in time with mandatory concentration limits, and require all ships to carry a ballast water record book and an international ballast water management certificate.
The ISM Code requires ship owners and ship managers to develop and maintain an extensive Safety Management System ("SMS"), 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 ISM Code requires the party with operational control of a vessel 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.
Beginning January 1, 2015, ships operating within an emission control area ("ECA") were not permitted to use fuel with sulfur content in excess of 0.1% (from 1.0%). Amended Annex VI establishes procedures for designating new ECAs.
As of January 1, 2015, ships operating within an ECA were not permitted to use fuel with sulfur content in excess of 0.1% m/m. Amended Annex VI establishes procedures for designating new ECAs. Currently, the IMO has designated four ECAs, including specified portions of the Baltic Sea area, North Sea area, North American area and United States Caribbean area.
These categories are: Handysize, Supramax, Ultramax, Panamax, Capesize and Very Large Ore Carrier. Certain routes and geographies are less accessible to certain vessel sizes. For example, Panamax and Supramax vessels are the main dry bulk vessel types deployed in the Baltic due to draft restrictions. Dry bulk vessels are employed through a number of different chartering options.
For example, Panamax and Supramax vessels are the main dry bulk vessel types deployed in the Baltic due to draft restrictions. Dry bulk vessels are employed through a number of different chartering options. The most common are time charters, spot charters, and voyage charters.
In addition to its owned fleet, the Company operates chartered-in Panamax, including post-Panamax and Kamsarmax, Supramax, including Ultramax, Handymax and Handysize drybulk carriers. The Company employed an average of 49 vessels at any one time during 2022 and 55 in 2021. In 2022, the Company owned interests in 26 vessels and chartered in another 183 for one or more voyages.
The Company operates a variety of chartered-in drybulk carriers in addition to its owned vessels. These chartered-in vessels, including Panamax, Supramax, Ultramax, Handymax, and Handysize vessels, play a significant role in the Company's operations. The Company employed an average of 46 vessels at any one time during 2023 and 49 in 2022.
Another example of value-added services is the formation of a new port in Newfoundland, Canada to load aggregate cargo for export and a temporary port used in Greenland to load the northernmost dry bulk cargo ever carried. As a result of efforts such as these, in some cases the Company is the de facto logistics department for certain clients.
The Company works with certain customers to review their contractual delivery terms and conditions, permitting those customers to reduce costs and certain risks. Another example of value-added services is the formation of a new port in Newfoundland, Canada to load aggregate cargo for export and a temporary port used in Greenland to load the northernmost dry bulk cargo ever carried.
Bermuda 100% (D) Phoenix Bulk Carriers (US) LLC Delaware 100% (E) Allseas Logistics Bermuda Ltd. Bermuda 100% (F) Bulk Trident Ltd. (“Bulk Trident”) Bermuda 100% (G) Nordic Bulk Carriers A/S (“NBC”) Denmark 100% (H) Nordic Bulk Ventures (Cyprus) Limited ("NBV") Cyprus 100% (H) 109 Long Wharf LLC (“Long Wharf”) Delaware 100% (I) Bulk Nordic Oshima (MI) Corp.
Bermuda 100% (D) Phoenix Bulk Carriers (US) LLC Delaware 100% (E) Allseas Logistics Bermuda Ltd. Bermuda 100% (F) Bulk Trident Ltd. (“Bulk Trident”) Bermuda 100% (G) Pangaea Logistics Solutions Denmark A/S.
A vessel’s attained EEXI must be less than the vessel’s required EEXI. Non-compliant vessels will have to upgrade their engine to continue to travel. With respect to the CII, the draft amendments would require ships of 5,000 gross tonnage to document and verify their actual annual operational CII achieved against a determined required annual operational CII.
The attained EEXI is required to be calculated for ships of 400 gross tonnage and above, in accordance with different values set for ship types and categories. With respect to the CII, the draft amendments would require ships of 5,000 gross tonnage to document and verify their actual annual operational CII achieved against a determined required annual operational CII.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIn connection with such forward looking statements, you should also carefully review the cautionary statements referred to under “Special Note Regarding Forward Looking Statements.” Our actual results could differ materially from those anticipated in the forward-looking statements as a result of specific factors, including the risks described below. 23 Summary of Risk Factors • The cyclical and volatile nature of the seaborne drybulk transportation industry may lead to significant decreases in charter and freight rates, which may have an adverse effect on our revenues, earnings and profitability and our ability to comply with our loan covenants. • Further increases in interest rates could adversely affect our cash flow and financial condition. • Any change in drybulk carrier capacity in the future may result in lower charter and freight rates which, in turn, will adversely affect our profitability. • The continuing conflict in Ukraine and resulting sanctions by the United States, European Union and other countries have adversely impact global economic conditions and contribute to inflation and volatility in commodity prices. • The market values of our owned vessels may decrease, which could limit the amount of funds that we can borrow or cause us to breach certain covenants in our credit facilities and we may incur impairment or a loss if we sell vessels following a decline in their market value. • The state of the global financial markets and economic conditions may adversely impact our ability to obtain additional financing on acceptable terms and otherwise negatively impact our business. • Changes in the economic and political environment in China and policies adopted by the government to regulate its economy may have a material adverse effect on our business, financial condition and results of operations. • Our financial results and operations may be adversely affected by the continuing impacts of the outbreak of COVID-19, and continuing governmental responses thereto in certain jurisdictions, including China. • Our revenues are subject to seasonal fluctuations, which could affect our operating results and our ability to pay dividends, if any, in the future. • If our vessels call on ports located in countries or territories or carry cargo that is the subject of sanctions or embargoes imposed by the U.S., the European Union, the United Nations, or other governmental authorities, it could lead to monetary fines or penalties and may adversely affect our reputation and the market for our securities. • We are subject to complex laws and regulations, including environmental regulations that can adversely affect the cost, manner or feasibility of doing business. • Changes in fuel prices, that may result from increased oil prices, may adversely affect our profitability. • In the highly competitive international shipping industry, we may not be able to compete successfully for chartered-in vessels or for vessel employment and, as a result, we may be unable to charter-in vessels at reasonable rates or employ our vessels profitably. • Increasing scrutiny and changing expectations from investors, lenders and other market participants with respect to our Environmental, Social and Governance (“ESG”) policies may impose additional costs on us or expose us to additional risks. • We depend upon a few significant customers for a large part of our revenues and cash flow, and the loss of one or more of these customers could adversely affect our financial performance. • We are subject to certain risks with counterparties on contracts and the failure of such counterparties to meet their obligations could cause us to suffer losses or otherwise adversely affect our business and ability to comply with covenants in our loan agreements, which could impose operating and financial restrictions on us. • Obligations associated with being a public company require significant company resources and management attention, and we incur increased costs as a result of being a public company. • Because we purchase and operate secondhand vessels, we may be exposed to increased operating costs which could adversely affect our earnings and, as our fleet ages, the risks associated with older vessels could adversely affect our ability to obtain profitable charters. • Our ability to obtain additional debt financing, or to refinance existing indebtedness, may be dependent on the performance and length of our charter contracts and the creditworthiness of our contract counterparties. • We depend on our Chief Executive Officer, Chief Operating Officer, Chief Financial Officer and other key employees, and the loss of their services would have a material adverse effect on our business, results and financial condition. • Exposure to currency exchange rate fluctuations will result in fluctuations in our cash flows and operating results. 24 • United States tax authorities could treat us as a “passive foreign investment company,” which could have adverse United States federal income tax consequences to U.S. holders. • We rely on our information systems to conduct our business, and failure to protect these systems against security breaches could adversely affect our business and results of operations, including on our vessels.
Biggest changeSummary of Risk Factors • The cyclical and volatile nature of the seaborne drybulk transportation industry may lead to significant decreases in charter and freight rates, which may have an adverse effect on our revenues, earnings and profitability and our ability to comply with our loan covenants. • Further increases in interest rates could adversely affect our cash flow and financial condition. • Any change in drybulk carrier capacity in the future may result in lower charter and freight rates which, in turn, will adversely affect our profitability. • The continuing conflict in Ukraine and the Middle East and resulting sanctions by the United States, European Union and other countries have adversely impact global economic conditions and contribute to inflation and volatility in commodity prices. • The market values of our owned vessels may decrease, which could limit the amount of funds that we can borrow or cause us to breach certain covenants in our credit facilities and we may incur impairment or a loss if we sell vessels following a decline in their market value. • The state of the global financial markets and economic conditions may adversely impact our ability to obtain additional financing on acceptable terms and otherwise negatively impact our business. • Changes in the economic and political environment in China and policies adopted by the government to regulate its economy may have a material adverse effect on our business, financial condition and results of operations. • Our financial results and operations may be adversely affected by the continuing impacts of the outbreak of COVID-19, and other epidemic and pandemic diseases and continuing governmental responses in certain jurisdictions, including China. • Our revenues are subject to seasonal fluctuations, which could affect our operating results and our ability to pay dividends, if any, in the future. • If our vessels call on ports located in countries or territories or carry cargo that is the subject of sanctions or embargoes imposed by the U.S., the European Union, the United Nations, or other governmental authorities, it could lead to monetary fines or penalties and may adversely affect our reputation and the market for our securities. • We are subject to complex laws and regulations, including environmental regulations that can adversely affect the cost, manner or feasibility of doing business. • Changes in fuel prices, that may result from increased oil prices, may adversely affect our profitability. 34 • In the highly competitive international shipping industry, we may not be able to compete successfully for chartered-in vessels or for vessel employment and, as a result, we may be unable to charter-in vessels at reasonable rates or employ our vessels profitably. • Increasing scrutiny and changing expectations from investors, lenders and other market participants with respect to our Environmental, Social and Governance (“ESG”) policies may impose additional costs on us or expose us to additional risks. • We depend upon a few significant customers for a large part of our revenues and cash flow, and the loss of one or more of these customers could adversely affect our financial performance. • We are subject to certain risks with counterparties on contracts and the failure of such counterparties to meet their obligations could cause us to suffer losses or otherwise adversely affect our business and ability to comply with covenants in our loan agreements, which could impose operating and financial restrictions on us. • Obligations associated with being a public company require significant company resources and management attention, and we incur increased costs as a result of being a public company. • Because we purchase and operate secondhand vessels, we may be exposed to increased operating costs which could adversely affect our earnings and, as our fleet ages, the risks associated with older vessels could adversely affect our ability to obtain profitable charters. • Our ability to obtain additional debt financing, or to refinance existing indebtedness, may be dependent on the performance and length of our charter contracts and the creditworthiness of our contract counterparties. • We depend on our Chief Executive Officer, Chief Operating Officer, Chief Financial Officer and other key employees, and the loss of their services would have a material adverse effect on our business, results and financial condition. • Exposure to currency exchange rate fluctuations will result in fluctuations in our cash flows and operating results. • United States tax authorities could treat us as a “passive foreign investment company,” which could have adverse United States federal income tax consequences to U.S. holders. • We rely on our information systems to conduct our business, and failure to protect these systems against security breaches could adversely affect our business and results of operations, including on our vessels.
In recent years China and India have been among the world’s fastest growing economies in terms of gross domestic product, and any economic slowdown in the Asia Pacific region particularly in China or India may adversely affect demand for seaborne transportation of our products and our results of operations.
In recent years China and India have been among the world’s fastest growing economies in terms of gross domestic product, and any economic slowdown in the Asia Pacific region particularly in China or India may adversely affect demand for seaborne transportation of our products and our results of operations.
Moreover, any deterioration in the economy of the United States or the European Union, may further adversely affect economic growth in Asia.
Moreover, any deterioration in the economy of the United States or the European Union, may further adversely affect economic growth in Asia.
United States tax authorities could treat us as a “passive foreign investment company,” which could have adverse United States federal income tax consequences to U.S. holders 44 A foreign corporation will be treated as a “passive foreign investment company,” or a PFIC, for United States federal income tax purposes if either (1) at least 75% of its gross income for any taxable year consists of certain types of “passive income” or (2) 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 which are received from unrelated parties in connection with the active conduct of a trade or business.
United States tax authorities could treat us as a “passive foreign investment company,” which could have adverse United States federal income tax consequences to U.S. holders A foreign corporation will be treated as a “passive foreign investment company,” or a PFIC, for United States federal income tax purposes if either (1) at least 75% of its gross income for any taxable year consists of certain types of “passive income” or (2) 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 which are received from unrelated parties in connection with the active conduct of a trade or business.
These factors include our ability to: • enter into new contracts for the transportation of cargoes; • develop customized logistics solutions within targeted dry bulk trades; • locate and acquire suitable vessels for acquisitions at attractive prices; • obtain required financing for our existing and new operations; • integrate any acquired vessels successfully with our existing operations, including obtaining any approvals and qualifications necessary to operate vessels that we acquire; • enhance our customer base; • hire, train and retain qualified personnel and crew to manage and operate our growing business and fleet; • identify additional new markets; and • improve our operating, financial and accounting systems and controls.
These factors include our ability to: • enter into new contracts for the transportation of cargoes; 50 • develop customized logistics solutions within targeted dry bulk trades; • locate and acquire suitable vessels for acquisitions at attractive prices; • obtain required financing for our existing and new operations; • integrate any acquired vessels successfully with our existing operations, including obtaining any approvals and qualifications necessary to operate vessels that we acquire; • enhance our customer base; • hire, train and retain qualified personnel and crew to manage and operate our growing business and fleet; • identify additional new markets; and • improve our operating, financial and accounting systems and controls.
Under the PFIC rules, unless those shareholders make an election available under the Code (which election could itself have adverse consequences for such shareholders, such shareholders would be liable to pay United States federal income tax at the then prevailing income tax rates on ordinary income plus interest upon excess distributions and upon any gain from the disposition of our common shares, as if the excess distribution or gain had been recognized ratably over the shareholder’s holding period of our common shares.
Under the PFIC rules, unless those shareholders make an election available under the Code (which election could itself have adverse consequences for such shareholders, such shareholders would be liable to pay United 54 States federal income tax at the then prevailing income tax rates on ordinary income plus interest upon excess distributions and upon any gain from the disposition of our common shares, as if the excess distribution or gain had been recognized ratably over the shareholder’s holding period of our common shares.
In addition, our reputation and the market for our securities may be adversely affected if we engage in certain other activities, such as lawfully entering into charters with individuals or entities that are not 34 controlled by the governments of countries or territories that are the subject of certain U.S. sanctions or embargo laws, or engaging in operations associated with those countries or territories pursuant to contracts with third parties that are unrelated to those countries or territories or entities controlled by their governments.
In addition, our reputation and the market for our securities may be adversely affected if we engage in certain other activities, such as lawfully entering into charters with individuals or entities that are not controlled by the governments of countries or territories that are the subject of certain U.S. sanctions or embargo laws, or engaging in operations associated with those countries or territories pursuant to contracts with third parties that are unrelated to those countries or territories or entities controlled by their governments.
If we are unable to meet our debt obligations, or if we otherwise default under our credit facilities or alternative financing arrangements, our lenders could declare the debt, together with accrued interest and fees, to be immediately due and payable and foreclose on our fleet, which could result in the acceleration of other indebtedness that we may have at such time and the commencement of similar foreclosure proceedings by other lenders.
If we are unable to meet our debt obligations, or if we otherwise default under our credit facilities or alternative financing arrangements, our lenders could declare the debt, together with accrued interest and fees, to be immediately due and payable and foreclose on our fleet, which 53 could result in the acceleration of other indebtedness that we may have at such time and the commencement of similar foreclosure proceedings by other lenders.
In addition, detention hijacking as a result of an act of piracy against our vessels, or an increase in cost, or unavailability of insurance for our vessels, could have a material adverse impact on our business, results of operations, cash flows and financial condition, and this may result in loss of revenues, increased costs and decreased cash flows to our customers, which could impair their ability to make payments to us under our charters.
In addition, detention hijacking as a result of an act of piracy against our vessels, or an increase in cost, or unavailability of insurance for our vessels, could have a material adverse impact on our business, results of operations, cash flows and financial condition, and 41 this may result in loss of revenues, increased costs and decreased cash flows to our customers, which could impair their ability to make payments to us under our charters.
Moreover, we operate in a sector of the economy that is likely to be adversely impacted by the effects of political conflicts, including the current political instability Ukraine, in the Middle East and the South China Sea region and other geographic countries and areas, geopolitical events such as terrorist or other attacks, and war (or threatened war) or international hostilities, such as those between the United States and North Korea.
Moreover, we operate in a sector of the economy that is likely to be adversely impacted by the effects of political conflicts, including the current political instability in Ukraine, in the Middle East and the South China Sea region and other geographic countries and areas, geopolitical events such as terrorist or other attacks, and war (or threatened war) or international hostilities, such as those between the United States and Iran or North Korea.
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 may increase if lenders increase interest rates, enact tighter lending standards, refuse to refinance existing debt at all or on terms similar to current debt, and reduce, or cease to provide funding to borrowers.
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 may increase if lenders increase interest rates, enact tighter lending 39 standards, refuse to refinance existing debt at all or on terms similar to current debt, and reduce, or cease to provide funding to borrowers.
To the extent that our existing capital and borrowing capabilities are insufficient to 46 meet these requirements and cover any losses, we will need to raise additional funds through debt or equity financings, including offerings of our common shares, securities convertible into our common shares, or rights to acquire our common shares, or curtail our growth and reduce our assets or restructure arrangements with existing security holders.
To the extent that our existing capital and borrowing capabilities are insufficient to meet these requirements and cover any losses, we will need to raise additional funds through debt or equity financings, including offerings of our common shares, securities convertible into our common shares, or rights to acquire our common shares, or curtail our growth and reduce our assets or restructure arrangements with existing security holders.
Despite our efforts to ensure the integrity of our systems and prevent future cybersecurity attacks, it is possible that our business, financial and other systems could be compromised, especially because such attacks can originate from a wide variety of sources including persons involved in organized crime or associated with external service providers.
Despite our efforts to ensure the integrity of our systems and prevent future cybersecurity attacks, it is possible that our business, financial and other systems could be compromised, especially because such attacks can originate from a wide variety 55 of sources including persons involved in organized crime or associated with external service providers.
Once we have entered into a COA, if we have not correctly anticipated vessel rates, location and availability for our owned or chartered-in fleet to fulfill the COA, we could suffer losses. Moreover, factors beyond our control may cause a COA to become unprofitable. Nevertheless, we would be obligated to continue to perform for the term of the COA.
Once we have entered into a COA, if we have not correctly anticipated vessel rates, location and availability for our owned or chartered-in fleet to fulfill the COA, we could 51 suffer losses. Moreover, factors beyond our control may cause a COA to become unprofitable. Nevertheless, we would be obligated to continue to perform for the term of the COA.
Global economic conditions may continue to negatively impact the drybulk shipping industry. 26 Major market disruptions and adverse changes in market conditions and regulatory climate in China, the United States, the European Union and worldwide may adversely affect our business or impair our ability to borrow amounts under credit facilities or any future financial arrangements.
Global economic conditions may continue to negatively impact the drybulk shipping industry. Major market disruptions and adverse changes in market conditions and regulatory climate in China, the United States, the European Union and worldwide may adversely affect our business or impair our ability to borrow amounts under credit facilities or any future financial arrangements.
The price and supply of fuel can be unpredictable and fluctuates based on events outside our control, including geopolitical developments, supply and demand for oil and gas, actions by the Organization of the Petroleum Exporting Countries, or OPEC, and other oil and gas producers, war and unrest in oil producing countries and regions, regional production patterns and environmental concerns.
The price and supply of fuel can be unpredictable and fluctuates based on events outside our control, including geopolitical developments, supply and demand for oil and gas, actions by the Organization of the Petroleum Exporting Countries, or OPEC, and other oil and gas producers, war and unrest in oil producing countries and regions, regional 46 production patterns and environmental concerns.
There is a 47 statutory remedy under Section 111 of the Companies Act which provides that a shareholder may seek redress in the courts as long as such shareholder can establish that our affairs are being conducted, or have been conducted, in a manner oppressive or prejudicial to the interests of some part of the shareholders, including such shareholder.
There is a statutory remedy under Section 111 of the Companies Act which provides that a shareholder may seek redress in the courts as long as such shareholder can establish that our affairs are being conducted, or have been conducted, in a manner oppressive or prejudicial to the interests of some part of the shareholders, including such shareholder.
Furthermore, detecting, investigating and resolving actual or alleged violations is expensive and can consume significant time and attention of our senior management. Risks Relating to Our Company 38 Our business strategy includes chartering-in vessels, and we may not be able to charter-in suitable vessels. Our business strategy depends, in large part, on our ability to charter-in vessels.
Furthermore, detecting, investigating and resolving actual or alleged violations is expensive and can consume significant time and attention of our senior management. Risks Relating to Our Company Our business strategy includes chartering-in vessels, and we may not be able to charter-in suitable vessels. Our business strategy depends, in large part, on our ability to charter-in vessels.
In addition, drybulk carriers are often subjected to battering treatment during unloading operations with grabs, jackhammers (to pry encrusted cargoes out of the hold), and small bulldozers. This treatment may cause damage to the vessel. Vessels damaged due to treatment during unloading procedures may be more susceptible to breach at sea.
In addition, drybulk carriers are often subjected to battering treatment during unloading 43 operations with grabs, jackhammers (to pry encrusted cargoes out of the hold), and small bulldozers. This treatment may cause damage to the vessel. Vessels damaged due to treatment during unloading procedures may be more susceptible to breach at sea.
In addition, we normally do not designate our FFAs for special hedge accounting and, as such, our use of such derivatives may lead to material fluctuations in our results of operations. 41 We also seek to manage our exposure to volatility in the market price of bunkers by entering into bunker hedging contracts.
In addition, we normally do not designate our FFAs for special hedge accounting and, as such, our use of such derivatives may lead to material fluctuations in our results of operations. We also seek to manage our exposure to volatility in the market price of bunkers by entering into bunker hedging contracts.
The loss of earnings while these vessels are forced to wait for space or to travel to more distant drydocking facilities may adversely affect our business and financial condition. The operation of drybulk carriers entails certain unique operational risks. 33 The operation of certain ship types, such as drybulk carriers, has certain unique risks.
The loss of earnings while these vessels are forced to wait for space or to travel to more distant drydocking facilities may adversely affect our business and financial condition. The operation of drybulk carriers entails certain unique operational risks. The operation of certain ship types, such as drybulk carriers, has certain unique risks.
In recent years, operating businesses in the global economy have faced weakening demand for goods and services, deteriorating 29 international liquidity conditions, and declining markets which lead to a general decline in the willingness of banks and other financial institutions to extend credit, particularly in the shipping industry.
In recent years, operating businesses in the global economy have faced weakening demand for goods and services, deteriorating international liquidity conditions, and declining markets which lead to a general decline in the willingness of banks and other financial institutions to extend credit, particularly in the shipping industry.
These reporting and other obligations place significant demands on our management, administrative, operational and accounting resources and we incur significant legal, accounting and other expenses as a result. The expenses incurred by public companies, generally, for reporting and corporate governance purposes have been increasing and the costs we incur for such purposes may 42 strain our resources.
These reporting and other obligations place significant demands on our management, administrative, operational and accounting resources and we incur significant legal, accounting and other expenses as a result. The expenses incurred by public companies, generally, for reporting and corporate governance purposes have been increasing and the costs we incur for such purposes may strain our resources.
If we are unable to replace the vessels in our fleet at the end of their useful 43 lives, our business, results of operations, financial condition and ability to pay dividends could be materially and adversely affected. We currently do not maintain reserves for vessel replacements.
If we are unable to replace the vessels in our fleet at the end of their useful lives, our business, results of operations, financial condition and ability to pay dividends could be materially and adversely affected. We currently do not maintain reserves for vessel replacements.
In addition, we may offer extended payment terms to our customers in order to secure contracts, which may lead to more frequent collection issues and adversely affect our financial results and liquidity. Additionally, we are subject to certain risks as a result of using our vessels as collateral.
In addition, we may offer extended 49 payment terms to our customers in order to secure contracts, which may lead to more frequent collection issues and adversely affect our financial results and liquidity. Additionally, we are subject to certain risks as a result of using our vessels as collateral.
A vessel must undergo annual surveys, intermediate 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 periodically over a five-year period. Our vessels are on special survey cycles for hull inspection and continuous survey cycles for machinery inspection.
A vessel must undergo annual surveys, intermediate 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 periodically over a five-year 52 period. Our vessels are on special survey cycles for hull inspection and continuous survey cycles for machinery inspection.
Please read “ Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources - Borrowing Activities .” 40 Furthermore, certain of our credit facilities contain a cross-default provision that may be triggered by a default under one of our other credit facilities.
Please read “ Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources - Borrowing Activities .” Furthermore, certain of our credit facilities contain a cross-default provision that may be triggered by a default under one of our other credit facilities.
If we do not meet these standards, our business and/or our ability to access capital could be harmed. These limitations in both the debt and equity capital markets may affect our ability to grow as our plans for growth may include accessing the equity and debt capital markets.
If we do not meet these standards, our business and/or our ability to access capital could be harmed. 47 These limitations in both the debt and equity capital markets may affect our ability to grow as our plans for growth may include accessing the equity and debt capital markets.
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.
Although state-owned enterprises still account for a substantial portion of the Chinese industrial output, in general, the Chinese 40 government is reducing the level of direct control that it exercises over the economy through State Plans and other measures.
To the extent that an existing shareholder does not purchase additional shares that we issue, that shareholder’s interest in our company will be diluted, which means that its percentage of ownership in our company will be reduced.
To the extent that an existing shareholder does not purchase additional shares that we issue, that shareholder’s interest in our company will be diluted, which 56 means that its percentage of ownership in our company will be reduced.
If our vessels call on ports located in countries or territories that is the subject of sanctions or embargoes imposed by the U.S., the European Union, the United Nations, or other governmental authorities, it could lead to monetary fines or other penalties and may adversely affect our reputation and the market for our securities.
If our vessels call on ports located in countries or territories that are the subject of sanctions or embargoes imposed by the U.S., the European Union, the United Nations, or other governmental authorities, it could lead to monetary fines or other penalties and may adversely affect our reputation and the market for our securities.
The Task Force’s goal is to develop initiatives to proactively identify ESG-related misconduct consistent with increased investor reliance on climate and ESG-related disclosure and investment. To implement the Task Force’s purpose, the SEC has taken several enforcement actions, with the first enforcement action taking place in May 2022, and promulgated new rules.
The Task Force’s goal is to develop initiatives to proactively identify ESG-related misconduct consistent with increased investor reliance on climate and ESG-related disclosure and investment. To implement the Task Force’s purpose, the SEC has taken several enforcement actions, with the first enforcement action taking place in May 2022, and proposed new rules.
The impact of such a scenario on dry bulk shipping will be negative, leading to lower spot rates and as a result lower freight futures prices. 28 Any change in drybulk carrier capacity in the future may result in lower charter and freight rates which, in turn, will adversely affect our profitability.
The impact of such a scenario on dry bulk shipping will be negative, leading to lower spot rates and as a result lower freight futures prices. 38 Any change in drybulk carrier capacity in the future may result in lower charter and freight rates which, in turn, will adversely affect our profitability.
These risks include the possibility of: • marine disaster; • environmental accidents; • cargo and property losses or damage; • damage to the environment, including through spillage of fuel, lubricants or other chemicals and substances used in operations; • business interruptions caused by mechanical failure, human error, war, terrorism, political action in various countries, labor strikes or adverse weather conditions; and • piracy.
These risks include the possibility of: • a marine accident or disaster; • environmental accidents and pollution; • cargo and property losses or damage; • damage to the environment, including through spillage of fuel, lubricants or other chemicals and substances used in operations; • business interruptions caused by mechanical failure, human error, war, terrorism, political action in various countries, labor strikes or adverse weather conditions; and • piracy.
Another extended downturn in the drybulk carrier market may have adverse consequences. The value of our common shares could be substantially reduced under these circumstances. We employ our vessels under a mix of voyage charters and time charters and COA’s which typically extend for varying lengths of time, from one month to ten years.
An extended downturn in the drybulk carrier market may have adverse consequences. The value of our common shares could be substantially reduced under these circumstances. 35 We employ our vessels under a mix of voyage charters and time charters and COA’s which typically extend for varying lengths of time, from one month to ten years.
We estimate the useful life of our vessels to be 25 or 30 years from the date of initial delivery from the shipyard. The remaining estimated useful lives of our vessels range from 11 to 24 years, depending on the age and type of vessel.
We estimate the useful life of our vessels to be 25 or 30 years from the date of initial delivery from the shipyard. The remaining estimated useful lives of our vessels range from 11 to 23 years, depending on the age and type of vessel.
The average age of our owned drybulk carriers at the time of this filing is approximately 9 years. A portion of our cash flows and income are dependent on the revenues earned by employing our vessels.
The average age of our owned drybulk carriers at the time of this filing is approximately 10 years. A portion of our cash flows and income are dependent on the revenues earned by employing our vessels.
In particular, beginning in February of 2022, President Biden and several European leaders also announced various economic sanctions against Russia in connection with the aforementioned conflicts in the Ukraine region, which have continued to expand over the past year and which may adversely impact our business.
In particular, beginning in February of 2022, President Biden and several European leaders also announced various economic sanctions against Russia in connection with the aforementioned conflicts in the Ukraine region, which have continued to expand over the past two years and which may adversely impact our business.
We may be adversely affected by developments in the SOFR market, changes in the methods by which SOFR is determined or the use of alternative reference rates. 27 In 2017, the U.K.
We may be adversely affected by developments in the SOFR market, changes in the methods by which SOFR is determined or the use of alternative reference rates. 37 In 2017, the U.K.
Risks Relating to our Industry The seaborne drybulk transportation industry is cyclical and volatile, and this may lead to reductions in our charter hire rates, vessel values and results of operations. The international seaborne drybulk transportation industry is cyclical and volatile, and a lengthy downturn in the drybulk charter market severely affected the entire drybulk shipping industry.
Risks Relating to our Industry The seaborne drybulk transportation industry is cyclical and volatile, and this may lead to reductions in our charter hire rates, vessel values and results of operations. The international seaborne drybulk transportation industry is cyclical and volatile, and a lengthy downturn in the drybulk charter market could severely affect the entire drybulk shipping industry.
Economic growth is uncertain but any slowdown, including due to supply-chain disruption, the recent surge in inflation and related actions by central banks and geopolitical conditions, could result in a significant risk of recession in many parts of the world in the near term.
Economic growth is uncertain but any slowdown, including due to supply-chain disruption, high energy process and the surge in inflation and related actions by central banks and geopolitical conditions, could result in a significant risk of recession in many parts of the world in the near term.
We were in compliance with all covenants for the years ended December 31, 2022 and 2021.
We were in compliance with all covenants for the years ended December 31, 2023 and 2022.
As of December 31, 2022, we are in compliance with covenants contained in our debt agreements.
As of December 31, 2023, we are in compliance with covenants contained in our debt agreements.
We may have to pay tax on United States source income, which would reduce our earnings Under sections 863(c)(3) and 887(a) of the Code, 50% of the gross shipping income of a vessel owning or chartering corporation, such as ourselves and our subsidiaries, that is attributable to transportation that begins or ends, but that does not both begin and end, in the United States may be subject to a 4% United States federal income tax without allowance for deduction, unless that corporation qualifies for exemption from tax under section 883 of the Code and the applicable Treasury Regulations promulgated thereunder.
Under sections 863(c)(3) and 887(a) of the Code, 50% of the gross shipping income of a vessel owning or chartering corporation, such as ourselves and our subsidiaries, that is attributable to transportation that begins or ends, but that does not both begin and end, in the United States may be subject to a 4% United States federal income tax without allowance for deduction, unless that corporation qualifies for exemption from tax under section 883 of the Code and the applicable Treasury Regulations promulgated thereunder.
Continuing conflicts, instability and other recent developments in Ukraine, the Middle East and elsewhere, and the presence of U.S. or other armed forces in Afghanistan and Syria, may lead to additional acts of terrorism and armed conflict around the world, which may contribute to further economic instability in the global financial markets.
Continuing conflicts, instability and other recent developments in Ukraine, the Middle East and elsewhere, and the presence and continuing military actions of U.S. or other armed forces in these regions may lead to additional acts of terrorism and armed conflict around the world, which may contribute to further economic instability in the global financial markets.
Risks Related To Our Common Shares Future sales of our common shares could cause the market price of our common shares to decline. The market price of our common shares could decline due to sales of a large number of shares in the market, including sales of shares by our large shareholders, or the perception that these sales could occur.
The market price of our common shares could decline due to sales of a large number of shares in the market, including sales of shares by our large shareholders, or the perception that these sales could occur.
The factors that influence the supply of vessel capacity include: • the number of newbuilding deliveries; • port and canal congestion; • bunker prices; • the scrapping rate of older vessels; • vessel casualties; • speed of vessels being operated; • the number of vessels that are out of service, namely those that are laid-up, dry-docked, awaiting repairs or otherwise not available for hire; • availability of financing for new vessels; • changes in national or international regulations that may effectively cause reductions in the carrying capacity of vessels or early obsolescence of tonnage; and • changes in environmental and other regulations that may limit the useful lives of vessels or requires technological developments not yet perfected for commercialization.
The factors that influence the supply of vessel capacity include: • the number and size of newbuilding orders and deliveries; • port and canal congestion, including as the result of restrictions or reductions in the capacity of the Panama and Suez Canals due to environmental or geopolitical factors, • bunker prices; • the scrapping rate of older vessels; • vessel casualties; • speed of vessels being operated; • the number of vessels that are out of service, namely those that are laid-up, dry-docked, awaiting repairs or otherwise not available for hire; • availability of financing for new vessels; • changes in national or international regulations that may effectively cause reductions in the carrying capacity of vessels or early obsolescence of tonnage; and • changes in environmental and other regulations that may limit the useful lives of vessels or requires technological developments not yet perfected for commercialization.
If our customers fail to meet their obligations to us or attempt to renegotiate our agreements, it may be difficult to secure suitable substitute employment for the vessel, and any new charter arrangements we secure may be at lower rates or, if our counterparties fail to deliver a vessel we have agreed to charter-in, or if a counterparty otherwise fails to honor its obligations to us under a contract, we could sustain significant losses, which could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends to holders of our common shares in the amounts anticipated or at all and compliance with covenants in our secured loan agreements. 39 Charterers are sensitive to the commodity markets and may be impacted by market forces affecting commodities and/or uncertain industry conditions.
If our customers fail to meet their obligations to us or attempt to renegotiate our agreements, it may be difficult to secure suitable substitute employment for the vessel, and any new charter arrangements we secure may be at lower rates or, if our counterparties fail to deliver a vessel we have agreed to charter-in, or if a counterparty otherwise fails to honor its obligations to us under a contract, we could sustain significant losses, which could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends to holders of our common shares in the amounts anticipated or at all and compliance with covenants in our secured loan agreements.
Although we have arranged insurance to cover certain environmental risks, there can be no assurance that such insurance will be sufficient to cover all such risks or that any claims will not have a material adverse effect on our business, results of operations, cash flows and financial condition and our ability to pay dividends.
Although we have arranged insurance to cover certain environmental risks, there can be no assurance that such insurance will be sufficient to cover all such risks or that any claims will not have a material adverse effect on our business, results of operations, cash flows and financial condition and our ability to pay dividends. 45 Regulations relating to ballast water discharge may adversely affect our revenues and profitability.
Factors that influence demand for vessel capacity include: • supply of and demand for energy resources, commodities, semi-finished and finished consumer and industrial products; • changes in the exploration or production of energy resources, commodities, semi-finished and finished consumer and industrial products; • the location of regional and global exploration, production and manufacturing facilities; 25 • 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, including armed conflicts, terrorist activities, sanctions, embargoes and strikes; • natural disasters and other disruptions in international trade; • developments in international trade; • changes in seaborne and other transportation patterns, including the distance cargo is transported by sea; • environmental and other regulatory developments; • currency exchange rates; • pandemics, such as the ongoing COVID-19 pandemic; • bunker (fuel) prices; and • weather.
Factors that influence demand for vessel capacity include: • supply of and demand for energy resources, commodities, semi-finished and finished consumer and industrial products; • changes in the exploration or production of energy resources, commodities, semi-finished and finished consumer and industrial products; • the location of regional and global exploration, 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, including armed conflicts, terrorist activities, sanctions, embargoes and strikes; • natural disasters and other disruptions in international trade; • disruptions and developments in international trade; • changes in seaborne and other transportation patterns, including the distance cargo is transported by sea; • environmental and other regulatory developments; • currency exchange rates; • international sanctions, embargoes, import and export restrictions, nationalizations, piracy, terrorist attacks and armed conflicts, including the ongoing Ukrainian-Russian and Israeli-Hamas conflicts; • economic slowdowns caused by public health pandemics; • bunker (fuel) prices; and • weather.
In addition, public health threats, such as COVID-19, influenza and other highly communicable diseases or viruses, outbreaks of which have from time to time occurred in various parts of the world in which we operate, including China, could adversely impact our operations, the timing of completion of scheduled dry-dockings and ballast water treatment system installation projects, as well as the operations of our customers. 32 Any of these occurrences could have a material adverse impact on our future performance, results of operations, cash flows and financial position.
In addition, public health threats, such as COVID-19, influenza and other highly communicable diseases or viruses, outbreaks of which have from time to time occurred in various parts of the world in which we operate, including China, could adversely impact our operations, the timing of completion of scheduled dry-dockings and ballast water treatment system installation projects, as well as the operations of our customers.
We continually monitor the market volatility associated with bunker prices and seek to hedge our exposure to changes in the price of marine fuels with our bunker hedging program. [Please see “ The Company’s Management and Discussion Analysis of Financial Condition and Results of Operations - Quantitative and Qualitative Disclosures about Market Risks - Fuel Swap Contracts .”] In the highly competitive international shipping industry, we may not be able to compete successfully for chartered-in vessels or for vessel employment and, as a result, we may be unable to charter-in vessels at reasonable rates or employ our vessels profitably.
Please see “ The Company’s Management and Discussion Analysis of Financial Condition and Results of Operations - Quantitative and Qualitative Disclosures about Market Risks - Fuel Swap Contracts .” In the highly competitive international shipping industry, we may not be able to compete successfully for chartered-in vessels or for vessel employment and, as a result, we may be unable to charter-in vessels at reasonable rates or employ our vessels profitably.
Accordingly, there can be no assurances regarding our status as a PFIC for the current taxable year or any future taxable year. United States Shareholders are urged to consult with their own tax advisors regarding the possible application of the PFIC rules.
Accordingly, there can be no assurances regarding our status as a PFIC for the current taxable year or any future taxable year. United States Shareholders are urged to consult with their own tax advisors regarding the possible application of the PFIC rules. We may have to pay tax on United States source income, which would reduce our earnings.
The perception that our vessels are a potential piracy or terrorist target could have a material adverse impact on our business, financial condition and results of operations. 31 Further, if these piracy attacks occur in regions in which our vessels are deployed that insurers characterize as “war risk” zones or by the Joint War Committee as “war and strikes” listed areas, premiums payable for such coverage could increase significantly and such insurance coverage may be more difficult to obtain, if available at all.
Further, if these piracy attacks occur in regions in which our vessels are deployed that insurers characterize as “war risk” zones or by the Joint War Committee as “war and strikes” listed areas, premiums payable for such coverage could increase significantly and such insurance coverage may be more difficult to obtain, if available at all.
As of December 31, 2022, we had total outstanding indebtedness of $116.0 million under our various credit facilities and a further $187.9 million of finance lease obligations. World events could affect our operations and financial results.
As of December 31, 2023, we had total outstanding indebtedness of $ 100.3 million under our various credit facilities and a further $167.7 million of finance lease obligations. World events could affect our operations and financial results.
The new regulations could require the installation of new equipment, which may cause us to incur substantial costs. Increased inspection procedures and tighter import and export controls could increase costs and disrupt our business. International shipping is subject to various security and customs inspections and related procedures in countries of origin, destination and trans-shipment points.
Increased inspection procedures and tighter import and export controls could increase costs and disrupt our business. International shipping is subject to various security and customs inspections and related procedures in countries of origin, destination and trans-shipment points.
Companies which do not adapt to or comply with investor, lender or other industry shareholder expectations and standards, which are evolving, or which are perceived to have not responded appropriately to the growing concern for ESG issues, regardless of whether there is a legal requirement to do so, may suffer from reputational damage and the business, financial condition, and/or stock price of such a company could be materially and adversely affected. 37 We may face increasing pressures from investors, lenders and other market participants, who are increasingly focused on climate change, to prioritize sustainable energy practices, reduce our carbon footprint and promote sustainability.
Companies which do not adapt to or comply with investor, lender or other industry shareholder expectations and standards, which are evolving, or which are perceived to have not responded appropriately to the growing concern for ESG issues, regardless of whether there is a legal requirement to do so, may suffer from reputational damage and the business, financial condition, and/or stock price of such a company could be materially and adversely affected.
These sanctions adversely affect our ability to operate in the region and also restrict parties whose cargo we may carry. Sanctions against Russia have also placed significant prohibitions on the maritime transportation of seaborne Russian oil, the importation of certain Russian energy products and other goods, and new investments in the Russian Federation.
Sanctions against Russia have also placed significant prohibitions on the maritime transportation of seaborne Russian oil, the importation of certain Russian energy products and other goods, and new investments in the Russian Federation. These sanctions further limit the scope of permissible operations and cargo we may carry.
In addition, if we charter-in a vessel and shipping rates subsequently decrease, or we are unable to secure employment for such a vessel, our obligation under the charter may adversely affect our financial condition and results of operations.
In addition, if we charter-in a vessel and shipping rates subsequently decrease, or we are unable to secure employment for such a vessel, our obligation under the charter may adversely affect our financial condition and results of operations. 48 We depend upon a few significant customers for a large part of our revenues and cash flow, and the loss of one or more of these customers could adversely affect our financial performance.
Major economic sanctions against Russia are having a considerable impact on oil and gas prices, given the dependence of the EU on oil and gas exports out of Russia combined with limited spare capacity of such commodities globally.
The ongoing conflict between Russia in Ukraine has developed into a war, posing an increasing risk for global economic growth. Major economic sanctions against Russia are having a considerable impact on oil and gas prices, given the dependence of the EU on oil and gas exports out of Russia combined with limited spare capacity of such commodities globally.
In particular, an adverse change in economic conditions affecting China, Japan, India or Southeast Asia generally could have a negative effect on the drybulk market. Volatility of LIBOR and potential changes of the use of LIBOR as a benchmark could affect our profitability, earnings and cash flow.
In particular, an adverse change in economic conditions affecting China, Japan, India or Southeast Asia generally could have a negative effect on the drybulk market.
We are subject to international safety regulations and the failure to comply with these regulations may subject us to increased liability, may adversely affect our insurance coverage and may result in a denial of access to, or detention in, certain ports.
Investor perception of the value of our common shares may be adversely affected by the consequences of war, the effects of terrorism, civil unrest and governmental actions in the countries or territories that we operate in. 44 We are subject to international safety regulations and the failure to comply with these regulations may subject us to increased liability, may adversely affect our insurance coverage and may result in a denial of access to, or detention in, certain ports.
Sea piracy incidents continue to occur, increasingly in the Sulu Sea and the Gulf of Guinea, with drybulk vessels particularly vulnerable to such attacks. In the past, political conflicts have also resulted in attacks on vessels, mining of waterways and other efforts to disrupt international shipping.
Sea piracy incidents continue to occur, increasingly in the Sulu Sea and the Gulf of Guinea, with drybulk vessels particularly vulnerable to such attacks.
Our vessels rely on information systems for a significant part of their operations, including navigation, provision of services, propulsion, machinery management, power 45 control, communications and cargo management.
The safety and security of our vessels and efficient operation of our business, including processing, transmitting and storing electronic and financial information, are dependent on computer hardware and software systems. Our vessels rely on information systems for a significant part of their operations, including navigation, provision of services, propulsion, machinery management, power control, communications and cargo management.
Global vaccination rates and effectiveness, together with the development of COVID-19 variants, could impact sustainability of this recovery, in addition to dry-bulk-specific seasonality. 30 Changes in the economic and political environment in China and policies adopted by the government to regulate its economy may have a material adverse effect on our business, financial condition and results of operations.
Changes in the economic and political environment in China and policies adopted by the government to regulate its economy may have a material adverse effect on our business, financial condition and results of operations.
Depending on the date of the IOPP renewal survey, existing vessels constructed before September 8, 2017 must comply with the updated D-2 standard on or after September 8, 2019. For most vessels, compliance with the D-2 standard will involve installing on-board systems to treat ballast water and eliminate unwanted organisms.
For most vessels, compliance with the D-2 standard will involve installing on-board systems to treat ballast water and eliminate unwanted organisms. Ships constructed on or after September 8, 2017 are to comply with the D-2 standards on or after September 8, 2017 and the costs of compliance may be substantial and adversely affect our revenues and profitability.
In addition, the conflict in Ukraine is disrupting energy production and trade patterns, including shipping in the Black Sea and elsewhere, and its impact on energy prices and charter rates, which initially have increased, is uncertain.
In addition, the conflict in Ukraine has continued disrupting energy production grain exports and trade patterns, including shipping in the Black Sea and elsewhere, and its impact on such markets remains uncertain.
The imposition of this taxation would have a negative effect on our business and would result in decreased earnings available for distribution to our shareholders. Information technology failures and data security breaches, including as a result of cybersecurity attacks, could negatively impact our results of operations and financial condition, subject us to increased operating costs, and expose us to litigation.
Information technology failures and data security breaches, including as a result of cybersecurity attacks, could negatively impact our results of operations and financial condition, subject us to increased operating costs, and expose us to litigation. We rely on our computer systems and network infrastructure across our operations, including on our vessels.
In addition, in depressed market conditions, charterers may have incentive to renegotiate their charters or default on their obligations under charters.
Charterers are sensitive to the commodity markets and may be impacted by market forces affecting commodities and/or uncertain industry conditions. In depressed market conditions, charterers may have incentive to renegotiate their charters or default on their obligations under charters.
For the year ended December 31, 2022, 1 customer accounted for more than 10% of total revenue and all of our top ten customers, representing 45% of total revenue, are repeat customers.
We expect to derive a significant part of our revenue and cash flow from a relatively small number of repeat customers. For the year ended December 31, 2023, two customers accounted for more than 10% of total revenue and all of our top ten customers, representing 57% of total revenue, are repeat customers.
On October 26, 2020, the EPA published a Notice of Proposed Rulemaking for Vessel Incidental Discharge National Standards of Performance under VIDA. Within two years after the EPA publishes its final Vessel Incidental Discharge National Standards of Performance, the U.S. Coast Guard must develop corresponding implementation, compliance and enforcement regulations regarding ballast water.
On October 26, 2020, the EPA published a Notice of Proposed Rulemaking for Vessel Incidental Discharge National Standards of Performance under VIDA. On October 18, 2023, the EPA published a supplemental notice of the proposed rule sharing new ballast water data received from the U.S. Coast Guard (“USCG”) and providing clarification on the proposed rule.
Moreover, cyberattacks against the Ukrainian government and other countries in the region have been reported in connection with the recent conflicts between Russia and Ukraine. To the extent such attacks have collateral effects on global critical infrastructure or financial institutions, such developments could adversely affect our business, operating results and financial condition.
Moreover, our risk of cyber-attack and other sources of security breaches and incidents may be elevated as a result of the ongoing conflicts between Russia and Ukraine and the Israel-Hamas conflict. To the extent such attacks have collateral effects on global critical infrastructure or financial institutions, such developments could adversely affect our business, operating results and financial condition.
Variable rate indebtedness could subject us to interest rate risk, which could cause our debt service obligations to increase significantly. Our credit facilities use variable interest rates and expose us to interest rate risk.
In particular, an adverse change in economic conditions affecting China, Japan, India or Southeast Asia generally could have a negative effect on the drybulk market. Variable rate indebtedness could subject us to interest rate risk, which could cause our debt service obligations to increase significantly. Our credit facilities use variable interest rates and expose us to interest rate risk.
Regulations relating to ballast water discharge may adversely affect our revenues and profitability. 35 The UN International Maritime Organization has imposed updated guidelines for ballast water management systems specifying the maximum amount of viable organisms allowed to be discharged from a vessel’s ballast water.
The UN International Maritime Organization has imposed updated guidelines for ballast water management systems specifying the maximum amount of viable organisms allowed to be discharged from a vessel’s ballast water. Depending on the date of the IOPP renewal survey, existing vessels constructed before September 8, 2017 must comply with the updated D-2 standard on or after September 8, 2019.
Ships constructed on or after September 8, 2017 are to comply with the D-2 standards on or after September 8, 2017 and the costs of compliance may be substantial and adversely affect our revenues and profitability. Furthermore, United States regulations are currently changing. Although the 2013 Vessel General Permit (“VGP”) program and U.S.
Furthermore, United States regulations are currently changing. Although the 2013 Vessel General Permit (“VGP”) program and U.S.
As a result of Russia’s actions in Ukraine, the U.S., EU and United Kingdom, together with numerous other countries, have imposed significant sanctions on persons and entities associated with Russia and Belarus, as well as comprehensive sanctions on certain areas within the Donbas region of Ukraine, and such sanctions apply to entities owned or controlled by such designated persons or entities.
As a result of Russia’s actions in Ukraine and the war between Israel and Hamas, the U.S., EU and United Kingdom, together with numerous other countries, have imposed significant economic sanctions which may adversely affect our ability to operate in the region and also restrict parties whose cargo we may carry.
Furthermore, fuel may become significantly more expensive in the future, 36 which may reduce our profitability.
Furthermore, fuel may become significantly more expensive in the future, which may reduce our profitability. We continually monitor the market volatility associated with bunker prices and seek to hedge our exposure to changes in the price of marine fuels with our bunker hedging program.
The COVID-19 pandemic and the resulting disruptions to the international shipping industry may continue to adversely affect our business, financial performance, and our results of operations, including the ability to obtain charters and financing.
Any of these occurrences could have a material adverse impact on our future performance, results of operations, cash flows and financial position. Outbreaks of epidemic and pandemic diseases and governmental responses thereto could adversely affect our business, financial performance, and our results of operations, including the ability to obtain charters and financing.
Removed
This Form 10-K also contains forward-looking statements that involve risks and uncertainties.
Added
This Form 10-K also contains forward-looking statements that involve risks and uncertainties. In connection with such forward looking statements, you should also carefully review the cautionary statements referred to under “Special Note Regarding Forward Looking Statements.” Our actual results could differ materially from those anticipated in the forward-looking statements as a result of specific factors, including the risks described below.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe Company leases office space in Copenhagen, Athens and Singapore.
Biggest changeThe Company leases office space in Copenhagen, Athens, Singapore and Port Everglades.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeMINE SAFETY DISCLOSURES Not applicable. 48 PART II
Biggest changeMINE SAFETY DISCLOSURES 58 Not applicable. 59 PART II

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeITEM 4. MINE SAFETY DISCLOSURES 48 PART II 49 ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES 49 ITEM 6. SELECTED FINANCIAL DATA 50 ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 52
Biggest changeITEM 4. MINE SAFETY DISCLOSURES 58 PART II 60 ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES 60 ITEM 6. SELECTED FINANCIAL DATA 60 ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 63

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe Company paid a quarterly cash dividend ranging from $0.035 to $0.10 per common share commencing in May 2019. In March 2020 the Company suspended its dividend due to the uncertainty caused by COVID-19 global pandemic and resumed its quarterly cash dividends payouts in December 2020.
Biggest changeThe Company paid a quarterly cash dividend ranging from $0.035 to $0.10 per common share commencing in May 2019.
Use of Proceeds Not applicable Purchases of Equity Securities by Issuer and Affiliates Not applicable Securities Authorized for Issuance Under Equity Compensation Plan See Part III, Item 12 for information regarding securities authorized for issuance under our equity compensation plan. 49
Use of Proceeds Not applicable Purchases of Equity Securities by Issuer and Affiliates Not applicable Securities Authorized for Issuance Under Equity Compensation Plan See Part III, Item 12 for information regarding securities authorized for issuance under our equity compensation plan.
Holders of Record As of the close of business on March 14, 2023, there were approximately 14 stockholders of record of our common stock. The actual number of stockholders is greater than this number of record holders, and includes stockholders who are beneficial owners, but whose shares are held in street name by brokers and other nominees.
Holders of Record As of the close of business on March 14, 2024, there were approximately 14 stockholders of record of our common stock. The actual number of stockholders is greater than this number of record holders, and includes stockholders who are beneficial owners, but whose shares are held in street name by brokers and other nominees.
On February 15, 2023, the Company's Board of Directors declared a quarterly cash dividend of $0.10 per common share, to be paid on March 15, 2023, to all shareholders of record as of March 1, 2023.
On February 15, 2024, the Company's Board of Directors declared a quarterly cash dividend of $0.10 per common share, to be paid on March 15, 2024, to all shareholders of record as of March 1, 2024.
We cannot assure you that we will be able to pay regular quarterly dividends, and our ability to pay dividends will be subject to the limitations set forth above and in the section of this Form 10-K titled “Risk Factors.” The Company has dividends payable of $0.6 million at December 31, 2022.
We cannot assure you that we will be able to pay regular quarterly dividends, and our ability to pay dividends will be subject to the limitations set forth above and in the section of this Form 10-K titled “Risk Factors.” The Company has dividends payable of $1.1 million at December 31, 2023.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeSELECTED FINANCIAL DATA (in thousands, except shipping days data) As of and for the years ended December 31, 2022 2021 Selected Data from the Consolidated Statements of Income Voyage revenue $ 640,034 $ 614,482 Charter revenue 59,673 103,622 Total revenue 699,707 718,104 Voyage expense 262,089 219,623 Charter hire expense 222,332 334,953 Vessel operating expenses 56,859 42,715 Total cost of transportation and service revenue 541,280 597,291 Vessel depreciation and amortization 29,377 22,874 Gross Profit 129,050 97,939 Other operating expenses 20,216 19,067 Loss on impairment of vessels 3,008 — Loss on sale of vessels 318 — Income from operations 105,508 78,872 Total other expense, net (20,000) (6,499) Net income 85,508 72,374 Income attributable to noncontrolling interests (6,016) (5,147) Net income attributable to Pangaea Logistics Solutions Ltd. $ 79,491 $ 67,227 Net income from continuing operations per common share information Basic income per share $ 1.79 $ 1.53 Diluted income per share $ 1.76 $ 1.50 Weighted-average common shares Outstanding - basic 44,399 43,997 Weighted-average common shares Outstanding - diluted 45,060 44,849 Cash dividends declared per share $ 0.30 $ 0.11 Adjusted EBITDA (1) 140,898 105,079 Shipping Days (2) Voyage days 15,237 15,932 Time charter days 2,478 3,963 Total shipping days 17,715 19,895 TCE Rates ($/day) $ 24,434 $ 25,056 Selected Data from the Consolidated Balance Sheets Cash and cash equivalents $ 128,385 $ 56,209 Total assets $ 748,241 $ 707,024 Total secured debt, including obligations under finance leases $ 299,481 $ 306,719 Total shareholders' equity $ 368,722 $ 300,681 Selected Data from the Consolidated Statements of Cash Flows Net cash provided by operating activities $ 134,801 $ 61,745 Net cash used in investing activities $ (28,509) $ (197,792) Net cash (used in) provided by financing activities $ (34,117) $ 143,859 Amounts in the table above have been calculated based on unrounded numbers.
Biggest changeSELECTED FINANCIAL DATA 60 (in thousands, except shipping days data) As of and for the years ended December 31, 2023 2022 Selected Data from the Consolidated Statements of Income Voyage revenue $ 468,581 $ 640,034 Charter revenue 23,716 59,673 Terminal & stevedore revenue 6,971 — Total revenue 499,268 699,707 Voyage expense 227,435 262,089 Charter hire expense 111,034 222,332 Vessel operating expenses 55,784 56,859 Terminal Expenses 5,809 — Total cost of transportation and service revenue 400,061 541,280 Vessel depreciation and amortization 29,339 29,377 Gross Profit 69,868 129,050 Other operating expenses 23,512 20,216 Loss on impairment of vessels — 3,008 Loss on sale of vessels 1,739 318 Income from operations 44,617 105,508 Total other expense, net (16,079) (20,000) Net income 28,538 85,508 Income attributable to noncontrolling interests (2,214) (6,016) Net income attributable to Pangaea Logistics Solutions Ltd. $ 26,323 $ 79,490 Net income from continuing operations per common share information Basic income per share $ 0.59 $ 1.79 Diluted income per share $ 0.58 $ 1.76 Weighted-average common shares Outstanding - basic 44,774 44,399 Weighted-average common shares Outstanding - diluted 45,475 45,060 Cash dividends declared per share $ 0.40 $ 0.30 Adjusted EBITDA (1) 79,724 140,898 Shipping Days (2) Voyage days 14,922 15,237 Time charter days 1,789 2,478 Total shipping days 16,711 17,715 TCE Rates ($/day) $ 15,849 $ 24,434 Selected Data from the Consolidated Balance Sheets Cash and cash equivalents $ 99,038 $ 128,385 Total assets $ 705,180 $ 748,241 Total secured debt, including obligations under finance leases $ 264,435 $ 299,481 Total shareholders' equity $ 370,196 $ 368,722 Selected Data from the Consolidated Statements of Cash Flows Net cash provided by operating activities $ 53,787 $ 134,801 Net cash used in investing activities $ (15,982) $ (28,509) Net cash used in by financing activities $ (67,152) $ (34,117) 61 Amounts in the table above have been calculated based on unrounded numbers.
Accordingly, certain amounts may not appear to recalculate due to the effect of rounding. (3) Net transportation and service revenue represents total revenue less the total direct costs of transportation and services, which includes charter hire, voyage and vessel operating expenses.
Accordingly, certain amounts may not appear to recalculate due to the effect of rounding. (3) Net transportation and service revenue represents total revenue less the total direct costs of transportation and services, which includes charter hire, voyage and vessel operating expenses, and terminal & stevedore expenses.
Accordingly, certain amounts may not appear to recalculate due to the effect of rounding. 50 (1) Adjusted EBITDA represents operating earnings before interest expense, income taxes, depreciation and amortization, loss on sale and leaseback of vessels, share-based compensation and other non-operating income and/or expense, if any.
Accordingly, certain amounts may not appear to recalculate due to the effect of rounding. (1) Adjusted EBITDA represents operating earnings before interest expense, interest income, income taxes, depreciation and amortization, loss on sale of vessels, share-based compensation and other non-operating income and/or expense, and other non-recurring items, if any.
(4) Gross profit represents total revenue less total cost of transportation and service revenue and less vessel depreciation and amortization. 51
(4) Gross profit represents total revenue less total cost of transportation and service revenue and less vessel depreciation and amortization. 62
The reconciliation of gross profit to net transportation and service revenue and income from operations to Adjusted EBITDA is as follows: (in thousands) Years Ended December 31, 2022 2021 Net Transportation and Service Revenue (3) Gross Profit (4) $ 129,050 $ 97,939 Add: Vessel Depreciation and Amortization 29,377 22,874 Net transportation and service revenue $ 158,427 $ 120,813 Adjusted EBITDA Net Income $ 85,508 $ 72,374 Interest expense, net 21,490 11,514 Depreciation and amortization 29,490 22,974 EBITDA $ 136,487 $ 106,862 Loss on sale of vessel 318 — Loss on impairment of vessels 3,008 — Share-based compensation 1,768 2,103 Unrealized gain on derivative instruments, net (682) (3,886) Adjusted EBITDA $ 140,898 $ 105,079 Amounts in the table above have been calculated based on unrounded numbers.
The reconciliation of gross profit to net transportation and service revenue and income from operations to Adjusted EBITDA is as follows: (in thousands) Years Ended December 31, 2023 2022 Net Transportation and Service Revenue (3) Gross Profit (4) $ 69,868 $ 129,050 Add: Vessel Depreciation and Amortization 29,339 29,377 Net transportation and service revenue $ 99,207 $ 158,427 Adjusted EBITDA Net Income $ 28,538 $ 85,508 Interest expense, net 13,916 21,490 Depreciation and amortization 30,070 29,490 EBITDA $ 72,524 $ 136,487 Loss on sale of vessel 1,739 318 Loss on impairment of vessels — 3,008 Share-based compensation 2,088 1,768 Unrealized gain on derivative instruments, net 2,925 (682) Other non-recurring items 448 — Adjusted EBITDA $ 79,724 $ 140,898 Amounts in the table above have been calculated based on unrounded numbers.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeConsiderations made by management in assessing the Company’s ability to continue as a going concern are its ability to consistently generate positive cash flows from operations, which were approximately $134.8 million in 2022, and $61.7 million in 2021; its excess of cash and cash restricted by facility agents over the current portion of secured long-term debt and finance lease obligations, and its focus on contract employment (COAs).
Biggest changeThe decrease in working capital was primarily driven by (i) $34.5 million of cash acquisitions, including the m/v Bulk Prudence and the port and terminal operation in June of 2023, (ii) $20.4 million reclassifications of long-term debt to current portion of long-term debt, and (iii) partially offset by proceeds from the sale of vessels and operating income generated during the twelve months ended December 31, 2023. 69 Considerations made by management in assessing the Company’s ability to continue as a going concern are its ability to consistently generate positive cash flows from operations, which were approximately $53.8 million in 2023, and $134.8 million in 2022; its excess of cash and cash restricted by facility agents over the current portion of secured long-term debt and finance lease obligations, and its focus on contract employment (COAs).
The Company used a portion of the proceeds of the loan to repay the outstanding balance of $51.5 million for the Nordic Oshima, Nordic Odin, Nordic Olympic and Nordic Oasis loan facilities which was set to mature on October 1, 2021. As of December 31, 2022 and 2021 the Company was in compliance with its financial covenants.
The Company used a portion of the proceeds of the loan to repay the outstanding balance of $51.5 million for the Nordic Oshima, Nordic Odin, Nordic Olympic and Nordic Oasis loan facilities which was set to mature on October 1, 2021. As of December 31, 2023 and 2022 the Company was in compliance with its financial covenants.
As of December 31, 2022 and 2021 the Company was in compliance with its financial covenants. The Bulk Sachuest Corp. Loan Agreement -- Dated October 13, 2022 The agreement advanced $8,500,000 in respect of the m/v Bulk Sachuest on October 13, 2022. The agreement requires repayment of the loan in 27 quarterly installments commencing on January 13, 2023.
As of December 31, 2023 and 2022 the Company was in compliance with its financial covenants. The Bulk Sachuest Corp. Loan Agreement -- Dated October 13, 2022 The agreement advanced $8,500,000 in respect of the m/v Bulk Sachuest on October 13, 2022. The agreement requires repayment of the loan in 27 quarterly installments commencing on January 13, 2023.
TCE rate is a common 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 rates for vessels on voyage charters are generally not expressed in per-day amounts while rates for vessels on time charters generally are expressed in per-day amounts.
TCE rate is a common shipping industry performance measure used primarily to compare daily earnings generated by vessels on time charters with daily earnings generated by vessels on 66 voyage charters, because rates for vessels on voyage charters are generally not expressed in per-day amounts while rates for vessels on time charters generally are expressed in per-day amounts.
This assessment is made at the assets group level, which 52 represents the lowest level for which identifiable cash flows are largely independent of other groups of assets. The asset groups established by the Company are defined by vessel size and major characteristic or trade.
This assessment is made at the assets group level, which represents the lowest level for which identifiable cash flows are largely independent of other groups of assets. The asset groups established by the Company are defined by vessel size and major characteristic or trade.
In such instances, an impairment charge would be recognized if the estimate of the undiscounted future cash flows expected to result from the use of the group and its eventual disposition is less than its carrying value.
In such instances, an 63 impairment charge would be recognized if the estimate of the undiscounted future cash flows expected to result from the use of the group and its eventual disposition is less than its carrying value.
Additionally, the agreement contains a minimum liquidity requirement, positive working capital of the borrower and a collateral maintenance ratio clause which requires the fair market value of the vessel plus the net realizable value of any additional collateral previously provided, to remain above defined ratios. At December 31, 2022 and 2021, the Company was in compliance with these covenants.
Additionally, the agreement contains a minimum liquidity requirement, positive working capital of the borrower and a collateral maintenance ratio clause which requires the fair market value 73 of the vessel plus the net realizable value of any additional collateral previously provided, to remain above defined ratios. At December 31, 2023 and 2022, the Company was in compliance with these covenants.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Results of Operations. 58 The table below summarizes our primary sources and uses of cash for the fiscal years ended December 31, 2022 and 2021. We have derived these summarized statements of cash flows from the consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Results of Operations. The table below summarizes our primary sources and uses of cash for the fiscal years ended December 31, 2023 and 2022. We have derived these summarized statements of cash flows from the consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
This includes installation of BWTS required under 59 new regulations, the cost of which will be $0.5 million to $0.7 million per vessel. The Company has some flexibility regarding the timing of drydocking, but the total cost is unpredictable. The Company expects to perform two special surveys in 2023 at an aggregate total cost of approximately $2.7 million.
This includes installation of BWTS required under new regulations, the cost of which will be $0.5 million to $0.7 million per vessel. The Company has some flexibility regarding the timing of drydocking, but the total cost is unpredictable. The Company expects to perform two special surveys in 2024 at an aggregate total cost of approximately $2.0 million.
The Company anticipates that this process of recertification will require it to reposition these vessels from a discharge port to shipyard facilities, which will reduce the Company’s available days and operating days during that period. 60 Borrowing Activities Long-term debt consists of the following: December 31, 2022 December 31, 2021 Interest Rate (%) (1) Maturity Date Bulk Nordic Odyssey (MI) Corp., Bulk Nordic Orion (MI) Corp.
The Company anticipates that this process of recertification will require it to reposition these vessels from a discharge port to shipyard facilities, which will reduce the Company’s available days and operating days during that period. 71 Borrowing Activities Long-term debt consists of the following: December 31, 2023 December 31, 2022 Interest Rate (%) (1) Maturity Date Bulk Nordic Odyssey (MI) Corp., Bulk Nordic Orion (MI) Corp.
The loan is secured by a first preferred mortgage on the m/v 63 Bulk Valor, the assignment of earnings, insurances and requisite compensation of the entity, and by guarantees of its shareholders. As of December 31, 2022 and 2021 the Company was in compliance with its financial covenants. The Bulk Promise Corp.
The loan is secured by a first preferred mortgage on the m/v Bulk Valor, the assignment of earnings, insurances and requisite compensation of the entity, and by guarantees of its shareholders. As of December 31, 2023 and 2022 the Company was in compliance with its financial covenants. The Bulk Promise Corp.
These include revenue recognition, deferred revenue, allowance for doubtful accounts, vessels and depreciation and long-lived assets impairment considerations, as defined above as well as the following: Voyage Expenses. The Company incurs expenses for voyage charters, including bunkers (fuel), port charges, canal tolls, brokerage commissions and cargo handling operations, which are expensed as incurred. Charter Expenses.
These include revenue recognition, deferred revenue, allowance for credit losses, vessels and depreciation and long-lived assets impairment considerations, as defined above as well as the following: Voyage Expenses. The Company incurs expenses for voyage charters, including bunkers (fuel), port charges, canal tolls, brokerage commissions and cargo handling operations, which are expensed as incurred. Charter Expenses.
We estimate the useful life of our vessels ranging between 25 years to 30 year from the date of initial delivery from the shipyard to the original owner. We estimate the scrap rate to be $300/lwt to compute each vessel's residual value. Depreciation and amortization expense increased $6.5 million or 28%.
We estimate the useful life of our vessels ranging between 25 years to 30 year from the date of initial delivery from the shipyard to the original owner. We estimate the scrap rate to be $300/lwt to compute each vessel's residual value. Depreciation and amortization expense increased $0.6 million or 2%.
The Company’s owned or partially owned and controlled fleet at December 31, 2022 includes: nine Panamax drybulk carriers (six of which are Ice-Class 1A); nine Supramax drybulk carriers, two Ultramax Ice-Class IC, one Ultramax and four Post Panamax Ice Class 1A drybulk vessels.
The Company’s owned or partially owned and controlled fleet at December 31, 2023 includes: nine Panamax drybulk carriers (six of which are Ice-Class 1A); seven Supramax drybulk carriers, two Ultramax Ice-Class IC, two Ultramax and four Post Panamax Ice Class 1A drybulk vessels.
The usage of such derivatives can lead to fluctuations in the Company’s reported results from operations on a period-to-period basis. The Company recorded an unrealized gain on derivative instruments of $0.7 million and $3.9 million in the year ended December 31, 2022 and 2021, respectively.
The usage of such derivatives can lead to fluctuations in the Company’s reported results from operations on a period-to-period basis. The Company recorded an unrealized loss on derivative instruments of $2.9 million in the year ended December 31, 2023 and an unrealized gain on derivative instruments of $0.7 million in the year ended December 31, 2022, respectively.
The decrease in charter revenues was due to a decrease in time charter days as well as a decrease in charter hire rates evidenced by the decrease in index rates for Panamax and Supramax vessels of approximately 20% compared to the same period of 2021.
The decrease in charter revenues was due to a decrease in time charter days as well as a decrease in charter hire rates evidenced by the decrease in index rates for Panamax and Supramax vessels of approximately 43% compared to the same period of 2022.
As of December 31, 2022 the Company was in compliance with its financial covenants.
As of December 31, 2023 and 2022 the Company was in compliance with its financial covenants.
The Company also paid $5.5 million of common stock cash dividends and $3.3 million cash dividends to non-controlling interests. Capital Expenditures The Company’s capital expenditures relate to the purchase of vessels and interests in vessels, and to capital improvements to its vessels which are expected to enhance the revenue earning capabilities and safety of these vessels.
The Company also paid $13.4 million of common stock cash dividends and $5.0 million cash dividends to non-controlling interests. 70 Capital Expenditures The Company’s capital expenditures relate to the purchase of vessels and interests in vessels, and to capital improvements to its vessels which are expected to enhance the revenue earning capabilities and safety of these vessels.
(2) Vessel was sold on March 3, 2023 Recent Accounting Pronouncements In March 2020, the FASB issued ASU No. 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting,” which provides optional expedients and exceptions for applying generally accepted accounting principles (“GAAP”) to contracts, hedging relationships and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform.
In March 2020, the FASB issued ASU No. 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting,” which provides optional expedients and exceptions for applying generally accepted accounting principles (“GAAP”) to contracts, hedging relationships and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform.
The cash flows from operating activities increased compared to the same period in the prior year primarily due to the increase in income from operations, and timing of customer receipts and supplier payments.
The cash flows from operating activities decreased compared to the same period in the prior year primarily due to the decrease in income from operations, and timing of customer receipts and supplier payments.
Results of Operations Fiscal Year Ended December 31, 2022 Compared to Fiscal Year Ended December 31, 2021 Revenues Pangaea’s revenues are derived predominantly from voyage charters and time charters. Total revenue for the fiscal year ended December 31, 2022, was $699.7 million compared to $718.1 million, for the same period in 2021, a 3% decrease.
Results of Operations Fiscal Year Ended December 31, 2023 Compared to Fiscal Year Ended December 31, 2022 Revenues Pangaea’s revenues are derived predominantly from voyage charters and time charters. Total revenue for the fiscal year ended December 31, 2023, was $499.3 million compared to $699.7 million, for the same period in 2022, a 29% decrease.
The Company expects to perform five intermediate surveys in 2023 at an aggregate total cost of approximately $0.4 million. The Company estimates that offhire related to the surveys and related repair work is ten to twenty days per vessel, depending on the size and condition of the vessel.
The Company expects to perform four intermediate surveys in 2024 at an aggregate total cost of approximately $0.3 million. The Company estimates that offhire related to the surveys and related repair work is ten to twenty days per vessel, depending on the size and condition of the vessel.
More specifically, and reflecting the composition of the Company's fleet, the average published market rates for Supramax and Panamax vessels decreased approximately 20% from an average of $25,146 in 2021 to $20,012 in 2022. We have historically experienced fluctuations in our results of operations on a 55 quarterly and annual basis due to the volatility of the dry bulk sector.
More specifically, and reflecting the composition of the Company's fleet, the average published market rates for Supramax and Panamax vessels decreased approximately 43% from an average of $20,012 in 2022 to $11,391 in 2023. We have historically experienced fluctuations in our results of operations on a quarterly and annual basis due to the volatility of the dry bulk sector.
The agreement advanced $18,000,000 in respect of the m/v Nordic Odyssey and m/v Nordic Orion. The agreement requires repayment of the advance in 28 equal quarterly principal and interest installments of $571,821 beginning on March 23, 2021 and a balloon payment of $4,400,000 due with the final installment in December 2027. Interest on this advance is fixed at 2.95%.
The agreement requires repayment of the advance in 28 equal quarterly principal and interest installments of $571,821 beginning on March 23, 2021 and a balloon payment of $4,400,000 due with the final installment in December 2027. Interest on this advance is fixed at 2.95%.
The decrease in charter hire expenses was primarily due to a decrease in market rates to charter-in vessels and a decrease in the number of chartered-in days from 12,859 days in the twelve months ended December 31, 2021 to 8,971 days for the twelve months ended December 31, 2022.
The decrease in charter hire expenses was primarily due to a decrease in market rates to charter-in vessels and a decrease in the number of chartered-in days from 8,971 days in the twelve months ended December 31, 2022 to 7,933 days for the twelve months ended December 31, 2023.
As a result, the Company may be unable to pursue opportunities to expand its business. At December 31, 2022 and 2021, the Company had working capital of $130.3 million and $72.2 million, respectively.
As a result, the Company may be unable to pursue opportunities to expand its business. At December 31, 2023 and 2022, the Company had working capital of $86.5 million and $130.3 million, respectively.
Effect of Inflation High inflation in the United States and in many of the global economies where the Company operates is beginning to impact vessel operating costs, including crew travel, transportation of equipment and spares, and drydocking costs.
Effect of Inflation High inflation in the United States and in many of the global economies where the Company operates has impacted vessel operating costs, including crew travel, transportation of equipment and spares, and drydocking costs.
The Company's achieved TCE rate for the year ended December 31, 2022 outperformed the average of the Baltic Panamax and Supramax market indexes and exceeded the average market rates by approximately 22% due to its long-term contracts of affreightment, ("COAs"), its specialized fleet and its cargo-focused strategy. 2022 Highlights • Net income attributable to Pangaea Logistics Solutions Ltd. was $79.5 million for twelve months ended December 31, 2022 as compared to $67.2 million for the same period of 2021. • Diluted net income per share was $1.76 for twelve months ended December 31, 2022, as compared to $1.50 for the same period of 2021. • Time Charter Equivalent ("TCE") rates earned by Pangaea was $24,434 per day for twelve months ended December 31, 2022 and $25,056 per day for the same period of 2021. • Adjusted EBITDA was $140.9 million for twelve months ended December 31, 2022, as compared to $105.1 million for the same period of 2021. • At the end of the year, Pangaea had $128.4 million in cash, and cash equivalents.
The Company's achieved TCE rate for the year ended December 31, 2023 outperformed the average of the Baltic Panamax and Supramax market indexes and exceeded the average market rates by approximately 39% due to its long-term contracts of affreightment, ("COAs"), its specialized fleet and its cargo-focused strategy. 2023 Highlights • Net income attributable to Pangaea Logistics Solutions Ltd. was $26.3 million for twelve months ended December 31, 2023 as compared to $79.5 million for the same period of 2022. • Diluted net income per share was $0.58 for twelve months ended December 31, 2023, as compared to $1.76 for the same period of 2022. • Time Charter Equivalent ("TCE") rates earned by Pangaea was $15,849 per day for twelve months ended December 31, 2023 and $24,434 per day for the same period of 2022. • Adjusted EBITDA was $79.7 million for twelve months ended December 31, 2023, as compared to $140.9 million for the same period of 2022. • At the end of the year, Pangaea had $99.0 million in cash, and cash equivalents.
Charter hire expenses paid to third party shipowners were $222.3 million for the year ended December 31, 2022, compared to $335.0 million for the year ended December 31, 2021, a 34% decrease.
Charter hire expenses paid to third party shipowners were $111.0 million for the year ended December 31, 2023, compared to $222.3 million for the year ended December 31, 2022, a 50% decrease.
(5) This facility is cross-collateralized by the vessels m/v Bulk Endurance, m/v Bulk Pride, and m/v Bulk Independence and is guaranteed by the Company. (6) A portion of unamortized debt issuance costs were reclassified as a reduction of the finance leases liabilities. Refer to Note 12 "Commitments and Contingencies" for additional information. Bulk Nordic Odin Ltd., Bulk Nordic Olympic Ltd.
(4) This facility is cross-collateralized by the vessels m/v Bulk Endurance, m/v Bulk Pride, and m/v Bulk Independence and is guaranteed by the Company. (5) A portion of unamortized debt issuance costs were reclassified as a reduction of the finance leases liabilities. Refer to Note 10 "Finance Leases" for additional information.
The Company's flexible charter-in strategy allows it to supplement its owned fleet with short term chartered-in tonnage at prevailing market prices, when needed, to meet cargo demand. Vessel Operating Expenses Vessel operating expenses for the year ended December 31, 2022 were $56.9 million, compared to $42.7 million for the same period in 2021, an increase of approximately 33%.
The Company's flexible charter-in strategy allows it to supplement its owned fleet with short term chartered-in tonnage at prevailing market prices, when needed, to meet cargo demand. Vessel Operating Expenses Vessel operating expenses for the year ended December 31, 2023 were $55.8 million, compared to $56.9 million for the same period in 2022, a decrease of approximately 2%.
The Company concluded that no triggering event had occurred during the twelve months ended December 31, 2021 which would require impairment testing. 53 The table set forth below indicates the purchase price of the Company’s vessels and the net carrying amount of each vessel as of December 31, 2022.
Also the Company concluded that no triggering event had occurred during the remaining period of the 2022 which would require impairment testing. 64 The table set forth below indicates the purchase price of the Company’s vessels and the net carrying amount of each vessel as of December 31, 2023.
Senior Secured Term Loan Facility (2) (3) 14,395,409 16,224,189 2.95 % December 2027 Bulk Nordic Oshima (MI) Corp., Bulk Nordic Odin (MI) Corp., Bulk Nordic Olympic (MI) Corp., Bulk Nordic Oasis (MI) Corp.
Senior Secured Term Loan Facility (2) (3) 12,512,080 14,395,409 2.95 % December 2027 Bulk Nordic Oshima (MI) Corp., Bulk Nordic Odin (MI) Corp., Bulk Nordic Olympic (MI) Corp., Bulk Nordic Oasis (MI) Corp.
The increase is primarily due to an increase in bunker consumption expense of $48.5 million driven by an increase in bunker fuel prices, partially offset by a decrease in port charges and canal tolls of $3.6 million. Total costs of bunkers consumed increased by 42% for the twelve months ended December 31, 2022 compared to the same period in 2021.
The decrease is primarily due to a decrease in bunker consumption expense of $40.7 million driven by a decrease in bunker fuel prices, partially offset by an increase in port charges and canal tolls of $2.3 million. Total costs of bunkers consumed decreased by 25% for the twelve months ended December 31, 2023 compared to the same period in 2022.
The Baltic Dry Index (“BDI”), a measure of dry bulk market performance, averaged 1,832 for 2022, compared to an average of 2,956 for 2021, down approximately 38%.
The Baltic Dry Index (“BDI”), a measure of dry bulk market performance, averaged 1,426 for 2023, compared to an average of 1,832 for 2022, down approximately 22%.
Impairment of vessels During the twelve months ended December 31, 2022, the Company recorded $3.0 million of impairment of vessel assets. On April 20, 2022 the Company entered into an agreement to sell the Bulk Pangaea for $8.8 million, the sale was finalized and the vessel delivered to its new owner on June 23, 2022.
On April 20, 2022 the Company entered into an agreement to sell the Bulk Pangaea for $8.8 million, the sale was finalized and the vessel delivered to its new owner on June 23, 2022. No loss on impairment of vessels were recorded in the year ended December 31, 2023.
After reaching levels not seen in over a decade in 2021, the dry bulk freight market remained strong in historical terms in the first half of 2022 before slowing down in the second half of the year due to decreased freight demand.
After reaching levels not seen in over a decade in 2021, the dry bulk freight market remained strong in historical terms in the first half of 2022 before slowing down in the second half of the year due to decreased freight demand. This slowdown continued through the first quarter of 2023, with signs of improvement throughout the remainder of 2023.
Loan Agreement -- Dated June 17, 2021 The agreement advanced $13,350,000 in respect of the m/v Bulk Valor on June 17, 2021. The agreement requires repayment of the loan in 28 quarterly installments commencing on September 17, 2021. A balloon payment is due on June 17, 2028. Interest on this advance is fixed at 3.29%.
The agreement requires repayment of the loan in 28 quarterly installments commencing on September 17, 2021. A balloon payment is due on June 17, 2028. Interest on this advance is fixed at 3.29%.
Charter revenues decreased to $59.7 million from $103.6 million, or 42%, for the year ended December 31, 2022 compared to the same period in 2021.
Charter revenues decreased to $23.7 million from $59.7 million, or 60%, for the year ended December 31, 2023 compared to the same period in 2022.
The loan is payable in 120 equal monthly installments of $9,133. Interest is floating at the 30 day LIBOR plus 2.00% (6.39% at December 31, 2022). The loan is collateralized by all real estate located at 109 Long Wharf, Newport, RI, and a corporate guarantee of the Company.
The loan is payable in 120 equal monthly installments of $9,133. Interest is floating at the 30 day LIBOR plus 2.00%. The loan is collateralized by all real estate located at 109 Long Wharf, Newport, RI, and a corporate guarantee of the Company. The loan contains a maximum loan to value covenant and a debt service coverage ratio.
The number of shipping days decreased 11% to 17,715 in the fiscal year ended December 31, 2022, from 19,895 for the same period in 2021.
The number of shipping days decreased 6% to 16,711 in the fiscal year ended December 31, 2023, from 17,715 for the same period in 2022.
The time charter days were down 37% to 2,478 in the twelve months ended December 31, 2022 from 3,963 in the twelve months ended December 31, 2021. The time charter revenue per day was $24,078 for the twelve months ended December 31, 2022 compared to $26,147 for the same period of 2021.
The time charter days were down 28% to 1,789 in the twelve months ended December 31, 2023 from 2,478 in the twelve months ended December 31, 2022. The time charter revenue per day was $13,258 for the twelve months ended December 31, 2023 compared to $24,078 for the same period of 2022.
Interest on this advance was fixed at 3.69% through March 2021, fixed at 4.39% through December 2021, and fixed at 3.46% thereafter. 62 The agreement also advanced $3,500,000 under Tranche B, which is payable in 28 equal quarterly installments of $65,000 beginning on September 27, 2017, and a balloon payment of $1,745,000 due with the final installment in May 2024.
The agreement also advanced $3,500,000 under Tranche B, which is payable in 28 equal quarterly installments of $65,000 beginning on September 27, 2017, and a balloon payment of $1,745,000 due with the final installment in May 2024.
TCE Performance For the year ended December 31, 2022, the Company's TCE rates were down only 2% to $24,434 from $25,056 for the year ended December 31, 2021, while the overall dry bulk market rates declined by approximately 20% for the year ended December 31, 2022.
TCE Performance For the year ended December 31, 2023, the Company's TCE rates were down 35% to $15,849 from $24,434 for the year ended December 31, 2022, while the overall dry bulk market rates declined by approximately 43% for the year ended December 31, 2023.
Financing Activities Net cash used in financing activities in 2022 was $34.1 million compared to net cash provided by financing activities of $143.9 million for the same period of 2021. During the twelve months ended December 31, 2022, the Company received $8.5 million in proceeds from long-term debt and $15.0 million in finance leases.
Financing Activities Net cash used in financing activities in 2023 was $67.2 million compared to net cash used in financing activities of $34.1 million for the same period of 2022. During the twelve months ended December 31, 2023, the Company repaid $15.8 million of long term debt, and $20.2 million of finance leases.
(In thousands of U.S. dollars) Vessel Name Date Acquired Size Year Build Purchase Price Net Carrying Amount m/v Bulk Endurance January 2017 UMX - 1C 2017 $ 28,000 $ 23,106 m/v Bulk Destiny January 2017 UMX - 1C 2017 24,000 19,815 m/v Bulk Courageous April 2021 UMX 2013 16,798 15,756 m/v Nordic Oasis January 2016 PMX-1A 2016 32,600 26,233 m/v Nordic Olympic February 2015 PMX-1A 2015 32,600 24,628 m/v Nordic Odin February 2015 PMX-1A 2015 32,625 24,726 m/v Nordic Oshima September 2014 PMX-1A 2014 33,709 24,292 m/v Nordic Orion April 2012 PMX-1A 2011 32,363 21,406 m/v Nordic Odyssey April 2012 PMX-1A 2010 32,691 20,685 m/v Bulk Valor June 2021 SMX 2013 18,182 17,106 m/v Bulk Friendship September 2019 SMX 2011 14,447 13,681 m/v Bulk Sachuest October 13 2022 SMX 2010 17,364 17,188 m/v Bulk Independence May 2019 SMX 2008 14,393 14,880 m/v Bulk Pride December 2017 SMX 2008 14,023 12,175 m/v Bulk Trident September 2012 SMX 2006 17,010 11,024 m/v Bulk Freedom June 2017 SMX 2005 9,016 7,464 m/v Bulk Newport (2) September 2013 SMX 2003 15,546 10,212 m/v Bulk Spirit February 2019 SMX 2009 13,000 11,703 m/v Bulk Xaymaca (1) August 2018 PMX 2006 14,010 13,083 m/v Bulk Concord February 2022 PMX 2009 19,900 19,395 m/v Bulk Promise July 2021 PMX 2013 18,633 17,619 m/v Nordic Nuluujaak May 2021 Post Panamax 1A 2021 38,424 37,519 m/v Nordic Qinngua June 2021 Post Panamax 1A 2021 38,471 37,428 m/v Nordic Sanngijuq September 2021 Post Panamax 1A 2021 37,920 37,000 m/v Nordic Siku November 2021 Post Panamax 1A 2021 37,935 37,393 Miss Nora G.
(In thousands of U.S. dollars) Vessel Name Date Acquired Size Year Build Purchase Price Net Carrying Amount m/v Bulk Endurance January 2017 UMX - 1C 2017 $ 28,000 $ 21,859 m/v Bulk Destiny January 2017 UMX - 1C 2017 24,000 18,770 m/v Bulk Prudence June 2023 UMX 2014 26,650 26,534 m/v Bulk Courageous April 2021 UMX 2013 16,798 15,145 m/v Nordic Oasis January 2016 PMX-1A 2016 32,600 24,854 m/v Nordic Olympic February 2015 PMX-1A 2015 32,600 23,306 m/v Nordic Odin February 2015 PMX-1A 2015 32,625 23,412 m/v Nordic Oshima September 2014 PMX-1A 2014 33,709 22,938 m/v Nordic Orion April 2012 PMX-1A 2011 32,363 19,790 m/v Nordic Odyssey April 2012 PMX-1A 2010 32,691 18,950 m/v Bulk Valor June 2021 SMX 2013 18,182 16,434 m/v Bulk Friendship September 2019 SMX 2011 14,447 12,811 m/v Bulk Sachuest October 2022 SMX 2010 17,364 16,487 m/v Bulk Independence May 2019 SMX 2008 14,393 13,753 m/v Bulk Pride December 2017 SMX 2008 14,023 11,194 m/v Bulk Freedom June 2017 SMX 2005 9,016 8,150 m/v Bulk Spirit February 2019 SMX 2009 13,000 12,970 m/v Bulk Xaymaca August 2018 PMX 2006 14,010 11,624 m/v Bulk Concord February 2022 PMX 2009 19,900 18,966 m/v Bulk Promise July 2021 PMX 2013 18,633 16,970 m/v Nordic Nuluujaak May 2021 Post Panamax 1A 2021 38,424 36,088 m/v Nordic Qinngua June 2021 Post Panamax 1A 2021 38,471 36,019 m/v Nordic Sanngijuq September 2021 Post Panamax 1A 2021 37,920 35,623 m/v Nordic Siku November 2021 Post Panamax 1A 2021 37,935 36,010 Miss Nora G.
Secured Term Loan Facility (2) (3) (4) 44,600,000 49,400,000 3.38 % June 2027 The Amended Senior Facility - Dated May 13, 2019 (formerly The Amended Senior Facility - Dated December 21, 2017) (5) – Bulk Nordic Six Ltd. - Tranche A (2) 10,099,993 11,166,661 4.39 % May 2024 – Bulk Nordic Six Ltd. - Tranche B 2,070,000 2,330,000 6.03 % May 2024 – Bulk Pride - Tranche C (2) 3,000,000 4,100,000 5.39 % May 2024 – Bulk Independence - Tranche E (2) 10,500,000 11,500,000 3.54 % May 2024 Bulk Freedom Loan Agreement — 2,600,000 June 2022 Bulk Valor Corp.
Secured Term Loan Facility (2) (3) (4) 39,800,000 44,600,000 3.38 % June 2027 The Amended Senior Facility - Dated May 13, 2019 (formerly The Amended Senior Facility - Dated December 21, 2017) (4) – Bulk Nordic Six Ltd. - Tranche A (2) 9,033,325 10,099,993 4.39 % May 2024 – Bulk Nordic Six Ltd. - Tranche B — 2,070,000 — % Paid in full in January 10, 2023 – Bulk Pride - Tranche C (2) 1,900,000 3,000,000 5.39 % May 2024 – Bulk Independence - Tranche E (2) 9,500,000 10,500,000 3.54 % May 2024 Bulk Valor Corp.
NBHC is consolidated in accordance with ASC 810-10 and as such, amounts pertaining to the non-controlling ownership held by the third parties in the financial position of NBHC are reported as non-controlling interest in the accompanying balance sheets. (4) On April 26, 2021, NBHC entered into a new Senior Secured Term Loan Facility with two new lenders.
NBHC is consolidated in accordance with ASC 810-10 and as such, amounts pertaining to the non-controlling ownership held by the third parties in the financial position of NBHC are reported as non-controlling interest in the accompanying balance sheets.
Additionally, the agreement contains a collateral maintenance ratio clause which requires the fair market value of the vessel plus the net realizable value of any additional collateral previously provided, to remain above defined ratios. As of December 31, 2022 and 2021 the Company was in compliance with its financial covenants.
Additionally, the agreement contains a collateral maintenance ratio clause which requires the fair market value of the vessel plus the net realizable value of any additional collateral previously provided, to remain above defined ratios.
(in millions) 2022 2021 Net cash provided by/(used in): Operating activities: Net income adjusted for non-cash items $ 127.1 $ 94.1 Changes in operating assets and liabilities, net 7.7 (32.4) Operating activities 134.8 61.7 Investing activities (28.5) (197.8) Financing activities (34.1) 143.9 Net change $ 72.2 $ 7.8 Operating Activities Net cash provided by operating activities during the year ended December 31, 2022 was $134.8 million, compared to net cash provided by operating activities of $61.7 million during the year ended December 31, 2021.
(in millions) 2023 2022 Net cash provided by/(used in): Operating activities: Net income adjusted for non-cash items $ 65.0 $ 122.8 Changes in operating assets and liabilities, net (11.2) 12.0 Operating activities 53.8 134.8 Investing activities (16.0) (28.5) Financing activities (67.2) (34.1) Net change $ (29.3) $ 72.2 Operating Activities Net cash provided by operating activities during the year ended December 31, 2023 was $53.8 million, compared to net cash provided by operating activities of $134.8 million during the year ended December 31, 2022.
Bulk Nordic Oshima (MI) Corp., Bulk Nordic Odin (MI) Corp., Bulk Nordic Olympic (MI) Corp., and Bulk Nordic Oasis (MI) Corp. Facility Agreement dated April 26, 2021 On April 26, 2021, NBHC entered into a new Senior Secured Term Loan Facility with two new lenders.
Facility Agreement dated April 26, 2021 On April 26, 2021, NBHC entered into a new Senior Secured Term Loan Facility with two new lenders. The agreement advanced $53.0 million in respect of the m/v Nordic Oshima, m/v Nordic Olympic, m/v Nordic Odin and m/v Nordic Oasis.
Excluding technical management fees, vessel operating expenses on a per day basis were $5,805 for the twelve months ended December 31, 2022 and $5,260 for the same period in 2021. Technical management fees were approximately $4.8 million and $3.9 million for the twelve months ended December 31, 2022 and 2021, respectively.
Ownership days for the twelve months ended December 31, 2023 and 2022 were 8,988 and 8,962, respectively. Excluding technical management fees, vessel operating expenses on a per day basis were $5,703 for the twelve months ended December 31, 2023 and $5,804 for the same period in 2022.
Investing Activities Net cash used in investing activities during the twelve months ended December 31, 2022 was $28.5 million compared to net cash used in investing activities of was $197.8 million for the same period in 2021. The Company purchased two vessels for $35.7 million in 2022.
Investing Activities Net cash used in investing activities during the twelve months ended December 31, 2023 was $16.0 million compared to net cash used in investing activities was $28.5 million for the same period in 2022.
Depreciation and Amortization We depreciate the cost of our vessels 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.
The increase was primarily due to an increase in costs associated with the acquisition of port and terminal operations in June of 2023. Depreciation and Amortization We depreciate the cost of our vessels 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.
The increase in voyage revenues was primarily due to higher average TCE rates earned throughout the first half of 2022 and partially offset by declined market rates in the second half of the 2022. The number of voyage days decreased 4% to 15,237 for the twelve months ended December 31, 2022 from 15,932 for the same period in 2021.
The decrease in voyage revenues was primarily due to lower average TCE rates earned throughout 2023 due to declined market rates. The number of voyage days decreased 2% to 14,922 for the twelve months ended December 31, 2023 from 15,237 for the same period in 2022.
As a result, we recorded an impairment charge of $3.0 million in the first quarter of 2022. The impairment analysis did not indicate any impairment on the remaining fleet. Also the Company concluded that no triggering event had occurred during the remaining period of the 2022 which would require impairment testing.
As a result, we recorded an impairment charge of $3.0 million in the first quarter of 2022. The impairment analysis did not indicate any impairment on the remaining fleet.
Interest on this advance is fixed at 3.38% effective May 5, 2021. The Loan is secured by a first lien on m/v Nordic Bulk Oshima, m/v Nordic Bulk Odin, m/v Nordic Bulk Olympic and m/v Nordic Bulk Oasis.
The Loan is secured by a first lien on m/v Nordic Bulk Oshima, m/v Nordic Bulk Odin, m/v Nordic Bulk Olympic and m/v Nordic Bulk Oasis.
The future minimum annual payments under the debt agreements are as follows: Years ending December 31, 2023 $ 15,782,530 2024 30,751,725 2025 10,476,019 2026 10,638,024 2027 39,955,014 Thereafter 8,430,693 $ 116,034,005 Related Party Transactions Amounts and notes payable to related parties consist of the following: December 31, 2021 Activity December 31, 2022 Included in accounts payable and accrued expenses on the consolidated balance sheets: Trade payables due to Seamar (i) $ 2,847,910 $ (1,204,104) $ 1,643,806 Commissions payable (trade payables) (ii) 38,896 (38,896) — Included in current related party notes payable on the consolidated balance sheets: Interest payable – 2011 Founders Note 242,852 (242,852) — Total current related party notes payable $ 242,852 $ (242,852) $ — i.
The future minimum annual payments under the debt agreements are as follows: Years ending December 31, 2024 $ 30,751,726 2025 10,476,019 2026 10,638,024 2027 39,955,014 2028 5,322,454 Thereafter 3,108,240 $ 100,251,477 Related Party Transactions 74 Amounts and notes payable to related parties consist of the following: December 31, 2022 Activity December 31, 2023 Included in accounts payable and accrued expenses on the consolidated balance sheets: Trade payables due to Seamar (i) $ 1,643,806 $ (153,746) $ 1,490,060 i.
Five drydockings were completed in 2021 and four drydockings were completed in 2022. Loss on sale of vessels 57 The Company recorded a loss of $0.3 million on the sale of the m/v Bulk Pangaea in the year ended December 31, 2022. No loss on sales of vessels were recorded in the year ended December 31, 2021.
The Company recorded a loss of $0.3 million on the sale of the m/v Bulk Pangaea in the year ended December 31, 2022. Impairment of vessels During the twelve months ended December 31, 2022, the Company recorded $3.0 million of impairment of vessel assets.
This use of cash was partially offset by the proceeds from the sale of one vessel for $8.4 million. Net cash used in investing activities of $197.8 million in 2021 primarily consists of $196.6 million for vessel acquisitions and investments in non-consolidated subsidiaries for $1.1 million.
Net cash used in investing activities of $28.5 million in 2022 primarily consists of $35.7 million for vessel acquisitions partially offset by the proceeds from the sale of one vessel for $8.4 million.
The port charges and canal tolls decreased primarily due to a decrease in voyage days of 4% to 15,237 days in the twelve months ended December 31, 2022 from 15,932 days for the same period in 2021 . Charter Hire Expenses The Company charters in vessels, typically on short term basis, from other shipowners to supplement its owned fleet.
The port charges and canal tolls increased primarily due to an increase in the market cost of canal tolls over the period. Charter Hire Expenses The Company charters in vessels, typically on short term basis, from other shipowners to supplement its owned fleet.
The agreement advanced $53.0 million in respect of the m/v Nordic Oshima, m/v Nordic Olympic, m/v Nordic Odin and m/v Nordic Oasis. The agreement requires repayment of the advance in 24 equal quarterly principal installments of $1,200,000 beginning on June 15, 2021 and a balloon payment of $24,200,000 due in March 2027.
The agreement requires repayment of the advance in 24 equal quarterly principal installments of $1,200,000 beginning on June 15, 2021 and a balloon payment of $24,200,000 due in March 2027. Interest on this advance is fixed at 3.38% effective May 5, 2021.
The Company repaid $15.4 million of long term debt, $15.8 million of finance leases and $5.0 million of other long term liabilities. The Company also paid $13.4 million of common stock cash dividends and $5.0 million cash dividends to non-controlling interests. Net cash provided by financing activities was $143.9 million for 2021.
The Company also paid $18.1 million of common stock cash dividends and $10.4 million cash dividends to non-controlling interests. Net cash used in financing activities was $34.1 million for 2022. During the twelve months ended December 31, 2022, the Company received $8.5 million in proceeds from long-term debt, $15.0 million in proceeds from finance leases.
The total amounts payable 64 to Seamar at December 31, 2022 and 2021, (including amounts due for vessel operating expenses), were $1,643,806 and $2,847,910, respectively. Off-Balance Sheet Arrangements We do not have any off-balance sheet arrangements as of December 31, 2022 or 2021. ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES Not applicable for a smaller reporting company.
Off-Balance Sheet Arrangements We do not have any off-balance sheet arrangements as of December 31, 2023 or 2022. ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES Not applicable for a smaller reporting company.
The adoption of ASU 2016-13 is currently not expected to have a material impact on the Company's consolidated financial statements. Important Financial and Operational Terms and Concepts The Company uses a variety of financial and operational terms and concepts when analyzing its performance.
The Company is currently evaluating the impact of our pending adoption of this standard on its financial statement disclosures. Important Financial and Operational Terms and Concepts The Company uses a variety of financial and operational terms and concepts when analyzing its performance.
The increase was primarily due to the 21% increase in ownership days to 8,962 days in 2022 from 7,382 days in 2021. The increase in ownership days is due to the acquisition of vessels, as noted above, which was part of a fleet renewal plan. The increase in depreciation and amortization expense was due to an increase in drydocking amortization.
The increase was primarily due to the increase in ownership days to 8,988 days in 2023 from 8,962 days in 2022. The increase in ownership days is due to the acquisition of vessels, offset by vessel sales in the current year, which was part of a fleet renewal plan.
(Seamar), an equity method investee, Seamar is responsible for the day-to-day operation of some of the Company’s owned vessels. During the years ended December 31, 2022 and 2021, the Company incurred technical management fees of $3,280,920 and $2,847,120 under this arrangement, which is included in vessel operating expenses in the consolidated statements of income.
During the years ended December 31, 2023 and 2022, the Company incurred technical management fees of $3,328,800 and $3,280,920 under this arrangement, which is included in vessel operating expenses in the consolidated statements of income. The total amounts payable to Seamar at December 31, 2023 and 2022, (including amounts due for vessel operating expenses), were $1,490,060 and $1,643,806, respectively.
Technical management services include day-to-day vessel operations, performing general vessel maintenance, ensuring regulatory and classification society compliance, arranging the hire of crew, and purchasing stores, supplies, and spare parts. Fleet Data. The Company believes that the measures for analyzing future trends in its results of operations consist of the following: • Shipping days.
Technical management services include day-to-day vessel operations, performing general vessel maintenance, ensuring regulatory and classification society compliance, arranging the hire of crew, and purchasing stores, supplies, and spare parts. Terminal & Stevedore Expenses . Terminal & Stevedore expenses represent the cost to provide the Company's cargo handling services.
The loan contains a maximum loan to value covenant and a debt service coverage ratio. The loan was repaid in full on January 25, 2023. At December 31, 2022 and 2021, the Company was in compliance with these covenants. The Bulk Valor Corp.
The loan was repaid in full on January 25, 2023. At December 31, 2022, the Company was in compliance with these covenants. The Bulk Valor Corp. Loan Agreement -- Dated June 17, 2021 The agreement advanced $13,350,000 in respect of the m/v Bulk Valor on June 17, 2021.
The revenue decrease was due to a 2% decrease in the average TCE rate, which was $24,434 per day for the twelve months ended December 31, 2022, compared to $25,056 per day for the same period in 2021.
The revenue decrease was primarily due to a 35% decrease in the average TCE rate, which was $15,849 per day for the twelve months ended December 31, 2023, compared to $24,434 per day for the same period in 2022. 67 Components of revenue are as follows: Voyage revenues decreased by 27% for the fiscal year ended December 31, 2023 to $468.6 million from $640.0 million for the same period in 2022.
Seamar Management S.A. ("Seamar") is a joint venture of which the Company owns 51% at December 31, 2022 and 2021 . ii. Phoenix Bulk Carriers (Brasil) Intermediacoes Maritimas Ltda. - a wholly-owned Company of a member of the Board of Directors Under the terms of a technical management agreement between the Company and Seamar Management S.A.
Seamar Management S.A. ("Seamar") is a joint venture of which the Company owns 51% at December 31, 2023 and 2022 . Under the terms of a technical management agreement between the Company and Seamar Management S.A. (Seamar), an equity method investee, Seamar is responsible for the day-to-day operation of some of the Company’s owned vessels.
Loan and Security Agreement (2) 11,424,507 12,718,279 3.29 % June 2028 Bulk Promise Corp. 11,069,630 12,453,926 5.45 % October 2027 Bulk Sachuest (2) $ 8,500,000 $ — 6.19 % October 2029 109 Long Wharf Commercial Term Loan 374,466 484,066 6.39 % April 2026 Total $ 116,034,005 $ 122,977,121 Less: unamortized bank fees (6) (1,431,736) (1,697,209) $ 114,602,269 $ 121,279,912 Less: current portion (15,782,530) (15,443,115) Secured long-term debt, net $ 98,819,739 $ 105,836,797 (1) As of December 31, 2022.
(2) 9,685,334 11,069,630 5.45 % October 2027 Bulk Sachuest (2) $ 7,733,094 $ 8,500,000 6.19 % October 2029 109 Long Wharf Commercial Term Loan — 374,466 — % Paid in full in January 24, 2023 Total $ 100,251,475 $ 116,034,005 Less: unamortized bank fees (5) (1,053,440) (1,431,736) $ 99,198,035 $ 114,602,269 Less: current portion (30,751,726) (15,782,530) Secured long-term debt, net $ 68,446,309 $ 98,819,739 (1) As of December 31, 2023.
A balloon payment of $8,766,658 is due with the final installment in May 2024.
A balloon payment of $8,766,658 is due with the final installment in May 2024. Interest on this advance was fixed at 3.69% through March 2021, fixed at 4.39% through December 2021, and fixed at 3.46% thereafter.
The agreement requires repayment of the advance in 24 equal quarterly installments of $375,000 beginning on March 28, 2016 and the loan was repaid in full on April 26, 2021. The Bulk Nordic Odyssey (MI) Corp., Bulk Nordic Orion (MI) Corp. Senior Secured Term Loan Facility - Dated December 23, 2020.
The Bulk Nordic Odyssey (MI) Corp., Bulk Nordic Orion (MI) Corp. Senior Secured Term Loan Facility - Dated December 23, 2020. The agreement advanced $18,000,000 in respect of the m/v Nordic Odyssey and m/v Nordic Orion.
The increase in vessel operating expenses was also attributable an increase in crew expenses due to an increase in crewing costs, crew changes and expenses related to COVID-19 and the war in Ukraine. The Company also continues to face general inflationary pressures particularly impacting the cost of lubes, stores and spares.
The Company continues to face general inflationary pressures particularly impacting the cost of lubes, stores and spares.
The average published market rates for Supramax and Panamax vessels decreased approximately 20% from an average of $25,146 in 2021 to $20,012 in the same period of 2022. The Company benefited for the full year in 2022 from the acquisition of vessels over 2021 and 2022.
Charter hire expenses on a per day basis were $13,996 for the twelve months ended December 31, 2023 and $24,783 for the same period in 2022. The average published market rates for Supramax and Panamax vessels decreased approximately 43% from an average of $20,012 in 2022 to $11,391 in the same period of 2023 .
The optionality 56 of our chartering strategy allows the Company to selectively release excess ship days, if any, into the market under time charter arrangements. Voyage Expenses Voyage expenses for the fiscal year ended December 31, 2022 were $262.1 million compared to $219.6 million for the year ended 2021, an increase of approximately 19%.
The optionality of our chartering strategy, in which the Company charters vessels in on short term periods with market available days during the charter period, allows the Company to selectively release excess ship days, if any, into the market under time charter arrangements.
General and Administrative Expenses General and administrative expenses increased from $19.0 million for the year ended December 31, 2021 to $20.1 million for the year ended December 31, 2022. The increase was primarily due to an increase in employee incentive compensation.
Terminal & Stevedore Expenses Terminal & Stevedore expenses increased to $5.8 million for the twelve months ended December 31, 2023, as a result of the company's acquisition of port and terminal operations in June 2023. 68 General and Administrative Expenses General and administrative expenses increased from $20.1 million for the year ended December 31, 2022 to $22.8 million for the year ended December 31, 2023.
During the twelve months ended December 31, 2021, the Company received $79.2 million in proceeds from long-term debt, $141.17 million in proceeds from finance leases and $9.2 million in proceeds from non-controlling interest recorded as a long-term liability. The Company repaid $62.0 million of long term debt, $9.9 million of finance leases and $2.5 million of other long term liabilities.
The Company repaid $15.4 million of long term debt, $15.8 million of finance leases and $5.0 million of other long term liabilities.
Removed
Revenue is not earned when vessels are offhire.

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