UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
FORM
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REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the fiscal year ended
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OR |
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the transition period from ____________ to ____________ |
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OR |
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SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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Date of event requiring this shell company report ____________ |
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Commission file number
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(Exact name of Registrant as specified in its charter) |
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(Translation of Registrant’s name into English) |
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(Jurisdiction of incorporation or organization) |
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(Address of principal executive offices) |
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(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person) |
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Title of each class
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Trading Symbol(s)
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Name of each exchange
on which registered
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NONE
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(Title of class)
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NONE
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(Title of class)
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Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report.
As of December 31, 2023,
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
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Yes |
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If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
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Yes |
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Note – Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
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No |
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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Sec.232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
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No |
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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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Large accelerated filer ☐ |
Accelerated filer ☐ |
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Emerging growth company
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If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. ☐
† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its
internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.
Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:
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International Financial Reporting Standards as issued by the International Accounting Standards Board |
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Other |
If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow:
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Item 17 |
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Item 18 |
If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
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Yes |
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No |
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(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)
Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. N/A
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Yes |
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No |
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1
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ITEM 1.
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1
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ITEM 2.
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1
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ITEM 3.
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1
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ITEM 4.
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31
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ITEM 4A.
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51
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ITEM 5.
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51
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ITEM 6.
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63
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ITEM 7.
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66
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ITEM 8.
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69
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ITEM 9.
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69 | |
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ITEM 10.
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69 | |
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ITEM 11.
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87
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ITEM 12.
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88
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88
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ITEM 13.
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88 | |
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ITEM 14.
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89
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ITEM 15.
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89
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ITEM 16.
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90
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ITEM 16A.
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90
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ITEM 16B.
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90
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ITEM 16C.
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91 | |
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ITEM 16D.
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91 | |
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ITEM 16E.
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91 | |
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ITEM 16F.
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91 | |
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ITEM 16G.
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91
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ITEM 16H.
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92
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ITEM 16I.
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92 | |
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ITEM 16J.
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92 | |
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ITEM 16K.
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92 | |
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93
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ITEM 17.
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93
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ITEM 18.
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93
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ITEM 19.
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94
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our ability to maintain or develop new and existing customer relationships with major refined product importers and exporters, major crude oil companies and major commodity traders, including our ability to
enter into long-term charters for our vessels;
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our future operating and financial results;
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our future vessel acquisitions, our business strategy and expected and unexpected capital spending or operating expenses, including any dry-docking, crewing, bunker costs and insurance costs;
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our financial condition and liquidity, including our ability to obtain financing in the future to fund capital expenditures, acquisitions and other general corporate activities;
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oil and chemical tanker industry trends, including fluctuations in charter rates and vessel values and factors affecting vessel supply and demand;
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our ability to take delivery of, integrate into our fleet, and employ any newbuildings we may acquire or order in the future and the ability of shipyards to deliver vessels on a timely basis;
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the aging of our vessels and resultant increases in operation and dry-docking costs;
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the ability of our vessels to pass classification inspections and vetting inspections by oil majors and big chemical corporations;
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significant changes in vessel performance, including increased vessel breakdowns;
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the creditworthiness of our charterers and the ability of our contract counterparties to fulfill their obligations to us;
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our ability to repay outstanding indebtedness, to obtain additional financing and to obtain replacement charters for our vessels, in each case, at commercially acceptable rates or at all;
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changes to governmental rules and regulations or actions taken by regulatory authorities and the expected costs thereof;
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our ability to comply with additional costs and risks related to our environmental, social and governance policies;
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potential liability from litigation and our vessel operations, including discharge of pollutants;
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changes in general economic and business conditions;
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general domestic and international political conditions, potential disruption of shipping routes due to accidents, political events, including “trade wars,” piracy, acts by terrorists or other hostilities;
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changes in production of or demand for oil and petroleum products and chemicals, either globally or in particular regions;
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the strength of world economies and currencies, including fluctuations in charterhire rates and vessel values;
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potential liability from future litigation and potential costs due to any environmental damage and vessel collisions;
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the length and severity of public health threats, epidemics and pandemics, including the global outbreak of the novel coronavirus (“COVID-19”) (and various variants that may emerge), and other disease
outbreaks and their impact on the demand for commercial seaborne transportation and the condition of the financial markets and governmental responses thereto; and
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and other important factors discussed “Item 3. Key Information—D. Risk Factors” or described from time to time in the reports filed by us with the U.S. Securities and Exchange Commission, or the SEC.
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| ITEM 1. |
IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
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OFFER STATISTICS AND EXPECTED TIMETABLE
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KEY INFORMATION
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[Reserved
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Capitalization and Indebtedness
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Reasons for the Offer and Use of Proceeds
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Risk Factors
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The international tanker industry has historically been both cyclical and volatile.
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The current state of the world financial market and current economic conditions could have a material adverse impact on our results of operations, financial condition and cash flows.
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Our financial results may be adversely affected by the outbreak of epidemic and pandemic diseases, such as COVID-19, and the related governmental responses thereto.
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The market value of our vessels, and those we may acquire in the future, may fluctuate significantly, which could cause us to incur losses if we decide to sell them following a decline in their market values
or we may be required to write down their carrying value, which will adversely affect our earnings.
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An over-supply of tanker capacity may lead to reductions in asset prices, charter hire rates and profitability.
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Volatility of SOFR could affect our profitability, earnings and cash flows.
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We are subject to complex laws and regulations, including environmental regulations that can adversely affect the cost, manner or feasibility of doing business.
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Climate change and greenhouse gas restrictions may adversely impact our operations and markets.
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Increasing growth of electric vehicles and renewable fuels could lead to a decrease in trading and the movement of crude oil and petroleum products worldwide.
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Our vessels may suffer damage due to the inherent operational risks of the tanker industry.
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We are subject to international safety regulations and requirements imposed by classification societies 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.
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If our vessels call on ports located in countries or territories that are the subject of sanctions or embargoes imposed by the U.S. government or other governmental authorities, it could lead to monetary
fines or adversely affect our business, reputation and the market for our common shares.
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Political instability, terrorist or other attacks, war, international hostilities and public health threats can affect the tanker industry, which may adversely affect our business.
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Acts of piracy on ocean-going vessels could adversely affect our business.
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Increased inspection procedures and tighter import and export controls could increase costs and disrupt our business.
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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. Additionally, if these
systems fail or become unavailable for any significant period of time, our business could be harmed.
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Our financing facilities contain restrictive covenants that may limit our liquidity and corporate activities, and could have an adverse effect on our financial condition and results of operations.
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Servicing current and future debt (including SLBs) will limit funds available for other purposes and could impair our ability to react to changes in our business.
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Our President, Chief Executive Officer and Director has significant influence over us, and a trust established for the benefit of his family may be deemed to beneficially own, directly or indirectly, 100% of
our Series D Preferred Shares, and thereby to control the outcome of matters on which our shareholders are entitled to vote.
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We have been subject to litigation in the past and may be subject to similar or other litigation in the future.
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Any limitation in the availability or operation of our vessels could have a material adverse effect on our business, results of operations and financial condition.
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We expect to be dependent on a limited number of customers for a large part of our revenues, and failure of such counterparties to meet their obligations could cause us to suffer losses or negatively impact
our results of operations and cash flows.
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If we fail to manage our planned growth properly, we may not be able to successfully expand our market share.
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Delays or defaults by the shipyards in the construction of newbuildings could increase our expenses and diminish our net income and cash flows.
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Our ability to obtain additional debt financing may be dependent on our ability to charter our vessels, the performance of our charters and the creditworthiness of our charterers.
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The industry for the operation of tanker vessels and the transportation of oil, petroleum products and chemicals is highly competitive and we may not be able to compete for charters with new entrants or
established companies with greater resources.
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We maintain cash with a limited number of financial institutions, including financial institutions that may be located in Greece, which will subject us to credit risk.
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We may be unable to attract and retain key management personnel and other employees in the international tanker shipping industry, which may negatively impact the effectiveness of our management and our
results of operations.
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If labor interruptions are not resolved in a timely manner, they could have a material adverse effect on our business, results of operations, cash flows, financial condition and available cash.
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A drop in spot charter rates may provide an incentive for some charterers to default on their charters, which could affect our cash flow and financial condition.
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An increase in operating costs could decrease earnings and available cash.
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The aging of our fleet may result in increased operating costs in the future, which could adversely affect our earnings.
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Rising fuel prices may adversely affect our profits.
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Unless we set aside reserves or are able to borrow funds for vessel replacement, our revenue will decline at the end of a vessel’s useful life, which would adversely affect our business, results of operations
and financial condition.
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Purchasing and operating secondhand vessels may result in increased operating costs and vessels off-hire, which could adversely affect our earnings.
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| ● | Our anticipated acquisition of an interest in a megayacht entails certain risks and uncertainties associated with our entry into ownership of a new class of vessels, and we cannot assure you that we will complete the acquisition or manage such risks successfully. |
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We may not have adequate insurance to compensate us if we lose any vessels that we acquire.
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We may be subject to increased premium payments, or calls, as we obtain some of our insurance through protection and indemnity associations.
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Increasing regulation as well as 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.
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Technological innovation and quality and efficiency requirements from our customers could reduce our charter hire income and the value of our vessels.
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The smuggling of drugs or other contraband onto our vessels may lead to governmental claims against us.
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Maritime claimants could arrest our vessels or vessels we may acquire, which could interrupt our cash flow.
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Governments could requisition our vessels or vessels we acquire during a period of war or emergency, resulting in loss of earnings.
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U.S. federal tax authorities could treat us as a “passive foreign investment company,” which could have adverse U.S. federal income tax consequences to U.S. shareholders.
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We may be subject to U.S. federal income tax on our U.S. source income, which would reduce our earnings.
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We are a “foreign private issuer,” which could make our common shares less attractive to some investors or otherwise harm our stock price.
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The market price and trading volume of our common shares may continue to be highly volatile, which could lead to a loss of all or part of a shareholder’s investment.
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There is no guarantee of a continuing public market for you to resell our common shares.
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Nasdaq may delist our common shares from its exchange which could limit your ability to make transactions in our securities and subject us to additional trading restrictions.
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We have issued common shares in the past through various transactions and we may do so in the future without shareholder approval, which may dilute our existing shareholders, depress the trading price of our
securities and impair our ability to raise capital through subsequent equity offerings.
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| ● | We may be unable to successfully consummate a planned spin-off of certain of our assets or to achieve some or all of the benefits that we expect to achieve from the spin-off, and may incur significant risks associated with the spin-off. |
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We are incorporated in the Republic of the Marshall Islands, which does not have a well-developed body of corporate law and as a result, shareholders may have fewer rights and protections under Marshall
Islands law than under a typical jurisdiction in the United States.
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It may not be possible for investors to serve process on or enforce U.S. judgments against us.
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Our By-laws provide that the High Court of the Republic of Marshall Islands shall be the sole and exclusive forum for certain disputes between us and our shareholders, which could limit our shareholders’
ability to obtain a favorable judicial forum for disputes with us or our directors, officers, or employees.
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We may not achieve the intended benefits of having a forum selection provision if it is found to be unenforceable.
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Anti-takeover provisions in our organizational documents could have the effect of discouraging, delaying or preventing a merger, amalgamation or acquisition, which could reduce the market price of our common
shares.
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Our Fleet Manager, on whom we are dependent to perform the day-to-day management of our fleet, may have conflicts of interest between us and its other clients and is a privately held company and there may be
limited or no publicly available information about it.
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supply and demand for oil, petroleum products and chemicals carried;
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changes in oil production and refining capacity resulting in shifts in trade flows for oil products;
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oil prices;
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the distance oil, petroleum products and chemicals are to be moved by sea;
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any restrictions on crude oil production imposed by the OPEC and non-OPEC oil producing countries
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global and regional economic and political conditions, including “trade wars” and developments in international trade, national oil reserves policies, fluctuations in industrial and agricultural production,
armed conflicts and work stoppages;
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increases in the production of oil in areas linked by pipelines to consuming areas, the extension of existing, or the development of new pipeline systems in markets we may serve, or the conversion of existing
non-oil pipelines to oil pipelines in those markets;
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worldwide and regional availability of refining capacity and inventories
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environmental and other legal and regulatory developments;
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economic slowdowns caused by public health events such as the COVID-19 pandemic and its variants and efforts throughout the world to contain their spread, or inflationary pressures and resultant governmental
responses;
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currency exchange rates;
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weather, natural disasters and other acts of God;
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increased use of renewable and alternative sources of energy
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competition from alternative sources of energy, other shipping companies and other modes of transportation; and
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international sanctions, embargoes, import and export restrictions, nationalizations, piracy and wars or other conflicts, including the war in Ukraine, the war between Israel and Hamas or the Houthi crisis in
and around the Red Sea.
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the number of newbuilding deliveries;
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current and expected newbuilding orders for vessels;
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the scrapping rate of older vessels;
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the availability of financing for new or secondhand tankers;
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the price of steel;
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speed of vessel operation;
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vessel freight rates, which are affected by factors that may affect the rate of newbuilding, swapping and laying up of vessels;
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the price of steel and vessel equipment;
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technological advances in the
design, capacity, propulsion technology, and fuel consumption efficiency of vessels
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potential conversion of vessels for alternative use;
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changes in environmental and other regulations that may limit the useful lives of vessels;
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port or canal congestion;
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national or international regulations that may effectively cause reductions in the carrying capacity of vessels or early obsolescence of tonnage;
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environmental concerns and regulations, including ballast water management, low sulfur fuel consumption regulations, and reductions in CO2 emissions;
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the number of vessels that are out of service at a given time, namely those that are laid-up, drydocked, awaiting repairs or otherwise not available for hire, including those that are in drydock for the
purpose of installing exhaust gas cleaning systems, known as scrubbers; and
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changes in global petroleum and chemical production.
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general economic and market conditions affecting the shipping industry;
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prevailing level of charter rates;
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competition from other shipping companies;
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types, sizes and ages of vessels;
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the availability of other modes of transportation;
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supply and demand for vessels;
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shipyard capacity and slot availability;
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cost of newbuildings;
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price of steel;
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exchange rate levels;
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number of tankers scrapped;
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governmental or other regulations; and
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technological advances
and the development, availability, and cost of nuclear power, natural gas, coal, renewable energy, and other alternative sources of energy
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IMO Data Collection System (DCS)
: in October 2016, at MEPC 70, the IMO adopted a
mandatory data collection system, or the IMO DCS, which requires vessels above 5,000 gross tons to report consumption data for fuel oil, hours under way and distance travelled. This IMO DCS covers any maritime activity carried out by
ships, including dredging, pipeline laying, and offshore installations. Data is reported annually to the flag state, which issues to the vessel a statement of compliance.
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Amendments to MARPOL Annex VI
: MEPC 79 adopted amendments to MARPOL, Annex VI
regarding reporting requirements in connection with the implementation of the Energy Efficiency Existing Ship Index, or EEXI, and carbon intensity indicator, or CII, framework, which amendments are expected to become effective on May 1,
2024. Beginning in January 2023, Annex VI requires EEXI and CII certification. The first annual reporting was to be completed in 2023, with initial ratings given in 2024.
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Net zero greenhouse emissions in the EU by 2050
: in 2021, the EU adopted a
European Climate Law (Regulation (EU) 2021/1119), establishing the aim of reaching net zero greenhouse gas emissions in the EU by 2050, with an intermediate target of reducing greenhouse gas emissions by at least 55% by 2030, compared to
1990 levels. In July 2021, the European Commission launched the “Fit for 55” to support the climate policy agenda. As of January 2019, large ships calling at EU ports have been required to collect and publish data on carbon dioxide
emissions and other information.
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Maritime emissions trading scheme in force on January 1, 2024
: the maritime
emissions trading scheme, or ETS, is to apply gradually over the period from 2024 to 2026. 40% of allowances would have to be surrendered in 2025 for the year 2024; 70% of allowances would have to be surrendered in 2026 for the year 2025;
and 100% of allowances would have to be surrendered in 2027 for the year 2026. Compliance is to be on a companywide (rather than per ship) basis and “shipping company” is defined widely to capture both the ship owner and any contractually
appointed commercial operator/ship manager/bareboat charterer who not only assume full compliance for ETS but also under the ISM Code. If the latter contractual arrangement is entered into this needs to be reflected in a certified mandate
signed by both parties and presented to the administrator of the scheme. The cap under the ETS would be set by taking into account EU MRV system emissions data for the years 2018 and 2019, adjusted, from year 2021 and is to capture 100%
of the emissions from intra-EU maritime voyages; 100% of emissions from ships at berth in EU ports and 50% of emissions from voyages which start or end at EU ports (but the other destination is outside the EU). Furthermore, the newly
passed EU Emissions Trading Directive 2023/959/EC makes clear that all maritime allowances would be auctioned and there will be no free allocation. 78.4 million emissions allowances are to be allocated specifically to maritime. New
systems, personnel, data management systems, costs recovery mechanisms, revised service agreement terms and emissions reporting procedures will have to be put in place to prepare for and manage the administrative aspect of ETS
compliance. The cost of compliance, and of our future EU emissions and costs to purchase an allowance for emissions (if we must purchase in order to comply) are unknown and difficult to predict, and are based on a number of factors,
including the size of our fleet, our trips within and to and from the EU, and the prevailing cost of allowances.
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maintain a consolidated leverage ratio of not more than 75%;
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maintain minimum free liquidity of $0.5 million per operating vessel but not less than $4.0 million in aggregate; and
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assure no change of control of the company takes place, except with the lessor’s/lender’s prior written consent.
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● |
increase our vulnerability to general economic downturns and adverse competitive and industry conditions;
|
|
|
● |
require us to dedicate a substantial portion, if not all, of our cash flow from operations to payments on our indebtedness, thereby reducing the availability of our cash flow to fund working capital, capital
expenditures and other general corporate purposes;
|
|
|
● |
limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;
|
|
|
● |
place us at a competitive disadvantage compared to competitors that have less debt or better access to capital;
|
|
|
● |
limit our ability to raise additional financing on satisfactory terms or at all; and
|
|
|
● |
adversely impact our ability to comply with the financial and other restrictive covenants of our current or future financing arrangements, which could result in an event of default under such agreements.
|
|
|
● |
generate excess cash flow for investment without jeopardizing our ability to cover current and foreseeable working capital needs (including debt service);
|
|
|
● |
raise equity and obtain required financing for our existing and new operations;
|
|
|
● |
locate and acquire suitable vessels;
|
|
|
● |
identify and consummate acquisitions or joint ventures;
|
|
|
● |
integrate any acquired business successfully with our existing operations;
|
|
|
● |
our manager’s ability to hire, train and retain qualified personnel and crew to manage and operate our growing business and fleet;
|
|
|
● |
enhance our customer base; and
|
|
|
● |
manage expansion.
|
|
|
• |
fluctuations in interest rates;
|
|
|
• |
fluctuations in the availability or the price of oil and chemicals;
|
|
|
• |
fluctuations in foreign currency exchange rates;
|
|
|
• |
announcements by us or our competitors;
|
|
|
• |
changes in our relationships with customers or suppliers;
|
|
|
• |
actual or anticipated fluctuations in our semi-annual and annual results and those of other public companies in our industry;
|
|
|
• |
changes in United States or foreign tax laws;
|
|
|
• |
international sanctions, embargoes, import and export restrictions, nationalizations, piracy and wars or other conflicts, including the war in Ukraine.
|
|
|
• |
actual or anticipated fluctuations in our operating results from period to period;
|
|
|
• |
shortfalls in our operating results from levels forecast by securities analysts;
|
|
|
• |
market conditions in the shipping industry and the general state of the securities markets;
|
|
|
• |
business interruptions caused by the outbreak of COVID-19 or the war in Ukraine;
|
|
|
• |
mergers and strategic alliances in the shipping industry;
|
|
|
• |
changes in government regulation;
|
|
|
• |
a general or industry-specific decline in the demand for, and price of, shares of our common shares resulting from capital market conditions independent of our operating performance;
|
|
|
• |
the loss of any of our key management personnel;
|
|
|
• |
our failure to successfully implement our business plan;
|
|
|
• |
issuance of shares; and
|
|
|
• |
stock splits / reverse stock splits.
|
|
|
• |
actual or anticipated fluctuations in our results and those of other public companies in our industry;
|
|
|
• |
mergers and strategic alliances in the shipping industry;
|
|
|
• |
market conditions in the shipping industry and the general state of the securities markets;
|
|
|
• |
changes in government regulation;
|
|
|
• |
shortfalls in our operating results from levels forecast by securities analysts; and
|
|
|
• |
announcements concerning us or our competitors.
|
|
|
● |
our existing shareholders’ proportionate ownership interest in us will decrease;
|
|
|
● |
the amount of cash available for dividends payable on the shares of our common shares may decrease;
|
|
|
● |
the relative voting strength of each previously outstanding common share may be diminished; and
|
|
|
● |
the market price of the shares of our common shares may decline.
|
|
|
• |
authorizing our Board of Directors to issue “blank check” preferred stock without stockholder approval;
|
|
|
• |
providing for a classified Board of Directors with staggered, three-year terms;
|
|
|
• |
prohibiting cumulative voting in the election of directors;
|
|
|
• |
authorizing the removal of directors only for cause and only upon the affirmative vote of the holders of at least 80% of the outstanding shares of our capital stock entitled to vote for the directors;
|
|
|
• |
prohibiting shareholder action by written consent unless the written consent is signed by all shareholders entitled to vote on the action;
|
|
|
• |
limiting the persons who may call special meetings of shareholders;
|
|
|
• |
establishing advance notice requirements for nominations for election to our Board of Directors or for proposing matters that can be acted on by shareholders at shareholder meetings; and
|
|
|
• |
restricting business combinations with interested shareholders.
|
|
|
● |
continue to operate our vessels and service our customers;
|
|
|
● |
renew existing charters upon their expiration;
|
|
|
● |
obtain new charters;
|
|
|
● |
obtain financing on commercially acceptable terms;
|
|
|
● |
obtain insurance on commercially acceptable terms;
|
|
|
● |
maintain satisfactory relationships with our customers and suppliers; and
|
|
|
● |
successfully execute our growth strategy.
|
| A. |
History and Development of the Company
|
|
|
● |
$10.0 million in cash.
|
|
|
● |
100% ownership in a Marshall Islands company that was a party to a shipbuilding contract for a high specification scrubber fitted Suezmax Tanker (to be named M/T Eco Oceano CA) delivered from Hyundai Samho
shipyard in March 2022. The shipowning company was party to a time charter, starting from the vessel’s delivery, with Central Tankers Chartering, a company affiliated with Mr. Evangelos J. Pistiolis, for a firm duration of five years at a
gross daily rate of $32,450, with a charterer’s option to extend for two additional years at $33,950 and $35,450.
|
|
|
● |
35% ownership in one Marshall Islands company that was a party to a shipbuilding contract for a high specification scrubber fitted VLCC tanker (to be named M/T Julius Caesar) delivered from Hyundai Heavy
Industries shipyard in January 2022. The shipowning company was party to a time charter, starting from the vessel’s delivery, with Trafigura, for a firm duration of three years at a gross daily rate of $36,000, with a charterer’s option to
extend for two additional years at $39,000 and $41,500.
|
|
|
● |
35% ownership in one Marshall Islands company that was a party to a shipbuilding contract for a high specification scrubber fitted VLCC tanker (to be named M/T Legio X Equestris) delivered from Hyundai Heavy
Industries shipyard in March 2022. The shipowning company was party to a time charter, starting from the vessel’s delivery, with Trafigura, for a firm duration of three years at a gross daily rate of $35,750, with a charterer’s option to
extend for two additional years at $39,000 and $41,500.
|
|
|
● |
A forgiveness of $1.2 million in payables to the buyer.
|
| B. |
Business Overview
|
|
Name
|
Deadweight
|
Charterer
|
End of firm
period
|
Charterer
’
s
Optional Periods
|
Gross Rate fixed period/
options
|
|
M/T Eco Marina Del Rey
|
50,000
|
Cargill / WECO Tankers A/S
|
May 2024 / May 2027
|
- / 1 year
|
Cargill: $15,100 /
WECO Tankers A/S: $20,500 / $22,500
|
|
Name
|
Deadweight
|
Charterer
|
End of firm
period
|
Charterer
’
s
Optional Periods
|
Gross Rate fixed period/
options
|
|
M/T Eco Bel Air
|
157,000
|
Trafigura
|
December 10, 2025
|
-
|
$24,000
|
|
M/T Eco Beverly Hills
|
157,000
|
Trafigura
|
July 2024
|
16 months
|
$24,000 / $24,000
|
|
Name
|
Deadweight
|
Charterer
|
End of firm
period
|
Charterer
’
s
Optional Periods
|
Gross Rate fixed period/
options
|
|
M/T Eco Oceano CA
|
157,000
|
Central Tankers Chartering
|
March 2037
|
none
|
$24,500
|
|
Name
|
Deadweight
|
Charterer
|
End of firm
period
|
Charterer
’
s Optional Periods
|
Gross Rate fixed
period/ options
|
|
M/T Eco West Coast
|
157,000
|
Clearlake
|
January 2027
|
1+1 years
|
$32,850 / $34,750 / $36,750
|
|
M/T Eco Malibu
|
157,000
|
Clearlake
|
March 2027
|
1+1 years
|
$32,850 / $34,750 / $36,750
|
|
Name
|
Deadweight
|
Charterer
|
End of firm
period
|
Charterer
’
s Optional
Periods
|
Gross Rate fixed period/
options
|
|
M/T Julius Caesar
|
300,000
|
Trafigura
|
January 2028
|
1+1 years
|
$36,000 up to January 2025 and $41,500 afterwards / $44,000 / $46,000
|
|
M/T Legio X Equestris
|
300,000
|
Trafigura
|
March 2028
|
1+1 years
|
$35,750 up to March 2025 and $41,500 afterwards / $44,000 / $46,000
|
|
Name
|
Deadweight
|
Charterer
|
End of firm period
|
Charterer
’
s
Optional Periods
|
Gross Rate fixed period/
options
|
|
M/T Eco Yosemite Park
|
50,000
|
Clearlake
|
March 2025
|
5+1+1 years
|
$17,400 / $18,650 / $19,900
|
|
M/T Eco Joshua Park
|
50,000
|
Clearlake
|
March 2025
|
5+1+1 years
|
$17,400 / $18,650 / $19,900
|
|
|
(i) |
injury to, destruction or loss of, or loss of use of, natural resources and related assessment costs;
|
|
|
(ii) |
injury to, or economic losses resulting from, the destruction of real and personal property;
|
|
|
(iii) |
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;
|
|
|
(iv) |
loss of subsistence use of natural resources that are injured, destroyed or lost;
|
|
|
(v) |
lost profits or impairment of earning capacity due to injury, destruction or loss of real or personal property or natural resources; and
|
|
|
(vi) |
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.
|
| C. |
Organizational Structure
|
| D. |
Property, Plants and Equipment
|
| ITEM 4A. |
UNRESOLVED STAFF COMMENTS
|
| ITEM 5. |
OPERATING AND FINANCIAL REVIEW AND PROSPECTS
|
| A. |
Operating Results
|
|
2022
|
2023
|
|||||||
|
FLEET DATA
|
||||||||
|
Total number of vessels at end of period (including leased vessels)
|
8
|
8
|
||||||
|
Average number of vessels
(1)
|
8
|
8
|
||||||
|
Total calendar days for fleet
|
2,912
|
2,920
|
||||||
|
Total available days for fleet
|
2,901
|
2,920
|
||||||
|
Total operating days for fleet
|
2,893
|
2,920
|
||||||
|
Total time charter days for fleet
|
2,893
|
2,920
|
||||||
|
Total spot (voyage) days for fleet
|
-
|
-
|
||||||
|
Fleet utilization
|
99.72
|
%
|
100.00
|
%
|
||||
|
2022
|
2023
|
|||||||
|
AVERAGE DAILY RESULTS
|
||||||||
|
Time charter equivalent
(2)
|
$
|
27,310
|
$
|
27,856
|
||||
|
Vessel operating expenses
(3)
|
$
|
6,397
|
$
|
6,345
|
||||
|
General and administrative expenses
(4)
|
$
|
555
|
$
|
2,293
|
| (1) |
Average number of vessels is the number of vessels that constituted our fleet (including chartered in vessels) for the relevant period, as measured by the sum of the number of days each vessel was a part of our fleet during the
period divided by the number of calendar days in that period.
|
| (2) |
Time charter equivalent rate, or TCE rate, is a measure of the average daily revenue performance of a vessel. Our definition of TCE may not be the same as
reported by other companies in the shipping industry or other industries. Our method of calculating TCE rate is determined by dividing TCE revenues by operating days for the relevant time period. TCE revenues are revenues minus
voyage expenses. Voyage expenses primarily consist of port, canal and fuel costs that are unique to a particular voyage, which would otherwise be paid by the charterer under a time charter contract, but are payable by us in the case
of a voyage charter, as well as commissions. TCE revenues and TCE rate, non-U.S. GAAP measures, are standard shipping industry performance measures that provide additional supplemental information in conjunction with shipping
revenues, the most directly comparable U.S. GAAP measure. We use TCE rates and TCE revenues to compare period-to-period changes in our performance and it assists investors and our management in evaluating our financial performance.
The following table reconciles our net revenues from vessel to TCE rate.
|
| (3) |
Operating expenses include crew wages and related costs, insurance, repairs and maintenance, spares and consumable stores, tonnage taxes and value added tax, or VAT, and other miscellaneous expenses. Daily vessel operating expenses
are calculated by dividing vessel operating expenses by fleet calendar days for the relevant time period. Our ability to control our fixed and variable expenses, including our daily vessel operating expenses, also affects our financial
results.
|
| (4) |
Daily general and administrative expenses are calculated by dividing general and administrative expenses by fleet calendar days for the relevant time period.
|
|
U.S. dollars in thousands, except average daily time charter equivalent and total operating days
|
2022
|
2023
|
||||||
|
On a consolidated basis
|
||||||||
|
Total Revenues
|
80,656
|
82,949
|
||||||
|
Less:
|
||||||||
|
Voyage expenses
|
(1,648
|
)
|
(1,609
|
)
|
||||
|
Time charter equivalent revenues
|
79,008
|
81,340
|
||||||
|
Total operating days
|
2,893
|
2,920
|
||||||
|
Average Daily Time Charter Equivalent (TCE)
|
$
|
27,310
|
$
|
27,856
|
||||
|
EBITDA*
|
||||||||
|
U.S. dollars in thousands
|
2022
|
2023
|
||||||
|
EBITDA
|
46,554
|
43,058
|
||||||
|
(Expressed in thousands of U.S. Dollars)
|
2022
|
2023
|
||||||
|
Net income
|
18,948
|
6,066
|
||||||
|
Add: Vessel depreciation
|
13,289
|
14,349
|
||||||
|
Add: Interest and finance costs
|
14,365
|
22,989
|
||||||
|
Less: Interest income
|
(48
|
)
|
(346
|
)
|
||||
|
EBITDA
|
46,554
|
43,058
|
||||||
|
|
• |
management of our financial resources, including banking relationships, i.e., administration of bank loans and bank accounts;
|
|
|
• |
management of our accounting system and records and financial reporting;
|
|
|
• |
administration of the legal and regulatory requirements affecting our business and assets; and
|
|
|
• |
management of the relationships with our service providers and customers.
|
|
|
• |
charter rates and periods of charter hire for our tankers;
|
|
|
• |
utilization of our tankers (earnings efficiency);
|
|
|
• |
levels of our tanker’s operating expenses and dry-docking costs;
|
|
|
• |
depreciation and amortization expenses;
|
|
|
• |
financing costs; and
|
|
|
• |
fluctuations in foreign exchange rates.
|
|
(Expressed in thousands of U.S. Dollars)
|
Year Ended December 31,
|
change
|
||||||||||||||
|
2022
|
2023
|
YE23 v YE22
|
||||||||||||||
|
$
|
%
|
|||||||||||||||
|
Total charter revenues
|
80,656
|
82,949
|
2,293
|
3
|
%
|
|||||||||||
|
Voyage expenses
|
1,648
|
1,609
|
(39
|
)
|
-2
|
%
|
||||||||||
|
Operating lease Expense
|
10,840
|
10,840
|
-
|
0
|
%
|
|||||||||||
|
Vessel operating expenses
|
18,628
|
18,527
|
(101
|
)
|
-1
|
%
|
||||||||||
|
Vessel depreciation
|
13,289
|
14,349
|
1,060
|
8
|
%
|
|||||||||||
|
Management fees-related parties
|
2,093
|
2,200
|
107
|
5
|
%
|
|||||||||||
|
General and administrative expenses
|
1,617
|
6,697
|
5,080
|
314
|
%
|
|||||||||||
|
Gain on sale of vessels
|
(78
|
)
|
-
|
78
|
-100
|
%
|
||||||||||
|
Operating income
|
32,619
|
28,727
|
(3,892
|
)
|
-12
|
%
|
||||||||||
|
Interest and finance costs
|
(14,365
|
)
|
(22,989
|
)
|
(8,624
|
)
|
60
|
%
|
||||||||
|
Interest income
|
48
|
346
|
298
|
621
|
%
|
|||||||||||
|
Equity gain/(loss) in unconsolidated joint ventures
|
646
|
(18
|
)
|
(664
|
)
|
-103
|
%
|
|||||||||
|
Total other expenses, net
|
(13,671
|
)
|
(22,661
|
)
|
(8,990
|
)
|
66
|
%
|
||||||||
|
Net income
|
18,948
|
6,066
|
(12,882
|
)
|
-68
|
%
|
||||||||||
|
|
1. |
Vessel depreciation
|
|
|
2. |
General and administrative expenses
|
|
|
3. |
Interest and Finance Costs
|
|
|
• |
a $7.3 million increase in interest costs mainly due to a) the increase in the variable interest rate of our credit facilities (LIBOR and SOFR) which increased from 4.74% in January 2023 to 5.62% in December 2023, while LIBOR ranged
from 0.10% in January 2022 to 4.74% in December 2022, and b) the three new SLBs for M/Ts Eco Oceano CA, Julius Caesar and Legio X Equestris that we closed in March, January and March 2022 respectively for an aggregate amount of $156.2
million, that where incurring interest expense for the whole year ended December 31, 2023. These increases were offset by a $0.9 million decrease in interest and finance costs relating to M/Ts Eco Los Angeles and Eco City of Angels that
were sold on February 28 and March 15, 2022;
|
|
|
• |
$3.5 million of amortization of debt discount relating to the Cargill facility (please see “Item 18. Financial Statements—Note 7—Debt”) that commenced in 2023; and
|
|
|
• |
an offsetting $1.3 million decrease in amortization of deferred financing fees mainly due to the acceleration of the amortization of $1.9 million of unamortized balances of deferred financing fees relating to the sale of M/Ts Eco Los
Angeles and Eco City of Angels and the prepayment of our Unsecured Bridge Loan in 2022. By comparison, in 2023 we accelerated $0.6 million of deferred financing fees relating to the prepayment of the ABN and the Alpha Bank facilities
(see “—B. Liquidity and Capital Resources—Debt Facilities— Prepayments of senior secured loans)”.
|
|
|
4. |
Equity gain/(loss) in unconsolidated joint ventures
|
| B. |
Liquidity and Capital Resources
|
| C. |
Research and Development, Patents and Licenses, Etc.
|
| D. |
Trend Information
|
| E. |
Critical Accounting Estimates
|
| ITEM 6. |
DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
|
| A. |
Directors and Senior Management
|
|
Name
|
Age
|
Position
|
||
|
Evangelos J. Pistiolis
|
51
|
Director, President, Chief Executive Officer
|
||
|
Alexandros Tsirikos
|
49
|
Director, Chief Financial Officer
|
||
|
Konstantinos Patis
|
50
|
Chief Technical Officer
|
||
|
Vangelis G. Ikonomou
|
60
|
Chief Operating Officer
|
||
|
Konstantinos Karelas
|
51
|
Independent Non-Executive Director
|
||
|
Stavros Emmanuel
|
81
|
Independent Non-Executive Director
|
||
|
Paolo Javarone
|
50
|
Independent Non-Executive Director
|
| B. |
Compensation
|
| C. |
Board Practices
|
| D. |
Employees
|
| E. |
Share Ownership
|
| F. |
Disclosure of a registrant’s action to recover erroneously awarded compensation.
|
| ITEM 7. |
MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
|
| A. |
Major Shareholders
|
|
Name and Address of Beneficial Owner
|
Number of Shares Owned
|
Percentage of
Class
|
Percentage
of
Total
Voting
Power
|
||||||
|
Lax Trust
(1)
|
100,000 Series D Preferred Shares
(1)
|
100
|
%
|
95.58
|
%
|
||||
|
3 Sororibus Trust
(2)
|
2,930,718
Common Shares
|
63.35
|
%
|
2.80
|
%
|
||||
|
Evangelos J. Pistiolis
(3)
|
446,446 Common Shares
|
9.65
|
%
|
0.43
|
%
|
||||
|
Executive officers, directors and key employees
(4)
|
0 Common Shares
|
0
|
%
|
0.00
|
%
|
||||
| (1) |
The Lax Trust is an irrevocable trust established for the benefit of certain family members of Mr. Evangelos J. Pistiolis, our President, Chief Executive
Officer and Director. The business address of the Lax Trust is Level 3, 18 Stanley Street, Auckland 1010, New Zealand. As a prerequisite for the Navigare Lease, Mr. Evangelos J. Pistiolis personally guaranteed the performance of the
bareboat charters entered in connection with the lease, under certain circumstances, and in exchange, we amended the Certificate of Designations governing the terms of the Series D Preferred Shares, to adjust the voting rights per
share of Series D Preferred Shares such that during the term of the Navigare Lease, the combined voting power controlled by Mr. Evangelos J. Pistiolis and the Lax Trust does not fall below a majority of our total voting power,
irrespective of any new common or preferred stock issuances, and thereby complying with a relevant covenant of the bareboat charters entered in connection with the Navigare Lease. The above percentage of total voting power is based on
100,000,000 votes carried by the outstanding Series D Preferred Share (1,000 votes per Series D Preferred Share held).
|
| (2) |
The above information is derived, in part, from the Amendment No. 39 to the 13D/A filed with the SEC on February 14, 2024. 3 Sororibus Trust is an irrevocable trust established for the benefit of certain
family members of Mr. Evangelos J. Pistiolis. The business address of 3 Sororibus Trust is 31 Kitiou Kyprianou, 3036, Limassol, Cyprus. 3 Sororibus Trust is the sole shareholder of Family Trading Inc., or Family Trading, a Marshall
Islands corporation, and may be deemed to beneficially own all of the common shares beneficially owned by Family Trading.
|
| (3) |
The above information is derived, in part, from the Amendment No. 39 to the 13D/A filed with the SEC on February 14, 2024.
|
| (4) |
Excludes the shares held by Mr. Evangelos J. Pistiolis that are reported elsewhere in this table.
|
| B. |
Related Party Transactions
|
| C. |
Interests of Experts and Counsel
|
| ITEM 8. |
FINANCIAL INFORMATION
|
| A. |
Consolidated Statements and Other Financial Information
|
| B. |
Significant Changes
|
| ITEM 9. |
THE OFFER AND LISTING
|
| ITEM 10. |
ADDITIONAL INFORMATION
|
| A. |
Share Capital
|
| B. |
Memorandum and Articles of Association
|
|
|
● |
prior to the date of the transaction that resulted in the shareholder becoming an interested shareholder, the Board approved either the business combination or the transaction that resulted in the shareholder
becoming an interested shareholder;
|
|
|
● |
upon consummation of the transaction that resulted in the shareholder becoming an interested shareholder, the interested shareholder owned at least 85% of the voting stock of the corporation outstanding at the
time the transaction commenced;
|
|
|
● |
at or subsequent to the date of the transaction that resulted in the shareholder becoming an interested shareholder, the business combination is approved by the Board and authorized at an annual or special
meeting of shareholders by the affirmative vote of at least 66 2/3% of the outstanding voting stock that is not owned by the interested shareholder; and
|
|
|
● |
the shareholder became an interested shareholder prior to the consummation of the initial public offering.
|
|
|
● |
not be redeemable;
|
|
|
● |
entitle holders to quarterly dividend payments in an amount per share equal to the aggregate per share amount of all cash dividends, and the aggregate per share amount (payable in kind) of all non-cash
dividends or other distributions other than a dividend payable in our common shares or a subdivision of our outstanding common shares (by reclassification or otherwise), declared on our common shares since the immediately preceding
quarterly dividend payment date; and
|
|
|
● |
entitle holders to one vote on all matters submitted to a vote of our shareholders.
|
|
|
● |
Flip In.
If an Acquiring Person obtains beneficial ownership of 15% or more of our common shares, then each Right will entitle the holder thereof to purchase, for the
Exercise Price, a number of our common shares (or, in certain circumstances, cash, property or other of our securities) having a then-current market value of twice the Exercise Price. However, the Rights are not exercisable following
the occurrence of the foregoing event until such time as the Rights are no longer redeemable by us, as further described below.
|
|
|
● |
Flip Over
. If, after an Acquiring Person obtains 15% or more of our common shares, (i) we merge into another entity; (ii) an acquiring entity merges into us; or (iii)
we sell or transfer 50% or more of its assets, cash flow or earning power, then each Right (except for Rights that have previously been voided as set forth above) will entitle the holder thereof to purchase, for the Exercise Price, a
number of our common shares of the person engaging in the transaction having a then-current market value of twice the Exercise Price.
|
|
|
● |
Notional Shares
. Shares held by affiliates and associates of an Acquiring Person, including certain entities in which the Acquiring Person beneficially owns a majority
of the equity securities, and Notional Common Shares (as defined in the Rights Agreement) held by counterparties to a Derivatives Contract (as defined in the Rights Agreement) with an Acquiring Person, will be deemed to be beneficially
owned by the Acquiring Person.
|
| C. |
Material Contracts
|
| D. |
Exchange controls
|
| E. |
Taxation
|
|
|
(1) |
we are organized in a foreign country, or our country of organization, that grants an “equivalent exemption” to corporations organized in the United States; and
|
|
|
(2) |
either
|
|
|
A. |
more than 50% of the value of our stock is owned, directly or indirectly, by individuals who are “residents” of our country of organization or of another foreign country that grants an “equivalent exemption”
to corporations organized in the United States (each such individual a “qualified shareholder” and such individuals collectively, “qualified shareholders”), which we refer to as the “50% Ownership Test,” or
|
|
|
B. |
our stock is “primarily and regularly traded on an established securities market” in our country of organization, in another country that grants an “equivalent exemption” to U.S. corporations, or in the United
States, which we refer to as the “Publicly Traded Test.”
|
|
|
● |
We have, or are considered to have, a fixed place of business in the United States involved in the earning of shipping income; and
|
|
|
● |
substantially all of our U.S.-source shipping income is attributable to regularly scheduled transportation, such as the operation of a vessel that follows a published schedule with repeated sailings at regular
intervals between the same points for voyages that begin or end in the United States, or is leasing income that is attributable to such fixed place of business in the United States.
|
|
|
● |
is a U.S. citizen or resident, U.S. corporation or other U.S. entity taxable as a corporation, an estate the income of which is subject to U.S. federal income taxation regardless of its source, or a trust (i)
if a court within the United States is able to exercise primary jurisdiction over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust or (ii) the trust has in
effect a valid election to be treated as a United States person for U.S. federal income tax purposes;
|
|
|
● |
owns the common shares as a capital asset, generally, for investment purposes; and
|
|
|
● |
owns less than 10% of our common shares for U.S. federal income tax purposes.
|
|
|
● |
at least 75% of our gross income for such taxable year consists of passive income (e.g., dividends, interest, capital gains and rents derived other than in the active conduct of a rental business); or
|
|
|
● |
at least 50% of the average value of the assets held by the corporation during such taxable year produce, or are held for the production of, passive income.
|
|
|
● |
the excess distribution or gain would be allocated ratably over the Non-Electing Holder’s aggregate holding period for the common shares;
|
|
|
● |
the amount allocated to the current taxable year and any taxable year before we became a PFIC would be taxed as ordinary income; and
|
|
|
● |
the amount allocated to each of the other taxable years would be subject to tax at the highest rate of tax in effect for the applicable class of taxpayer for that year, and an interest charge for the deemed
tax deferral benefit would be imposed with respect to the resulting tax attributable to each such other taxable year.
|
|
|
● |
the gain is effectively connected with a trade or business conducted by the Non-U.S. Holder in the United States. If the Non-U.S. Holder is entitled to the benefits of a U.S. income tax treaty with respect to
that gain, that gain is taxable only if it is attributable to a permanent establishment maintained by the Non-U.S. Holder in the United States; or
|
|
|
● |
the Non-U.S. Holder is an individual who is present in the United States for 183 days or more during the taxable year of disposition and other conditions are met.
|
|
|
● |
fail to provide an accurate taxpayer identification number;
|
|
|
● |
are notified by the IRS that you have failed to report all interest or dividends required to be shown on your U.S. federal income tax returns; or
|
|
|
● |
in certain circumstances, fail to comply with applicable certification requirements.
|
| F. |
Dividends and Paying Agents
|
| G. |
Statement by Experts
|
| H. |
Documents on Display
|
| I. |
Subsidiary Information
|
| J. |
Annual Report to Security Holders
|
| ITEM 11. |
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
| ITEM 12. |
DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
|
| ITEM 13. |
DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
|
| ITEM 14. |
MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
|
| ITEM 15. |
CONTROLS AND PROCEDURES
|
| a) |
Disclosure Controls and Procedures
|
| b) |
Management
’
s Annual Report on Internal Control over Financial Reporting
|
|
|
● |
Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;
|
|
|
● |
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and
expenditures are being made only in accordance with authorizations of Company’s management and directors; and
|
|
|
● |
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.
|
| c) |
Attestation Report of the Registered Public Accounting Firm
|
| d) |
Changes in Internal Control over Financial Reporting
|
| ITEM 16. |
RESERVED
|
| ITEM 16A. |
AUDIT COMMITTEE FINANCIAL EXPERT
|
| ITEM 16B. |
CODE OF ETHICS
|
| ITEM 16C. |
PRINCIPAL ACCOUNTANT FEES AND SERVICES
|
|
U.S. dollars in thousands,
|
Year Ended
|
|||||||
|
2022
|
2023
|
|||||||
|
Audit Fees
|
379.5
|
410.3
|
||||||
| ITEM 16D. |
EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
|
| ITEM 16E. |
PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
|
| ITEM 16F. |
CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT
|
| ITEM 16G. |
CORPORATE GOVERNANCE
|
|
|
● |
Audit Committee
. Nasdaq requires, among other things, that a listed company has an audit committee with a minimum of three independent members, at least one of whom
meets certain standards of financial sophistication. As permitted under Marshall Islands law, our audit committee consists of three independent directors but we do not designate any one audit commit member as meeting the standards of
financial sophistication.
|
|
|
● |
As a foreign private issuer, we are not required to hold regularly scheduled board meetings at which only independent directors are present.
|
|
|
● |
In lieu of obtaining shareholder approval prior to the issuance of designated securities, we will comply with provisions of the BCA, which allows our Board of Directors to approve share issuances.
|
| ITEM 16H. |
MINE SAFETY DISCLOSURE
|
| ITEM 16I. |
DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
|
| ITEM 16J. |
INSIDER TRADING POLICIES
|
| ITEM 16K. |
CYBERSECURITY
|
| ITEM 17. |
FINANCIAL STATEMENTS
|
| ITEM 18. |
FINANCIAL STATEMENTS
|
| ITEM 19. |
EXHIBITS
|
|
Number
|
Description of Exhibits
|
|
1.1
|
|
|
|
|
|
1.2
|
|
|
|
|
|
1.3
|
|
|
|
|
|
1.4
|
|
|
|
|
|
1.5
|
|
|
|
|
|
1.6
|
|
|
|
|
|
1.7
|
|
|
|
|
|
1.8
|
|
|
|
|
|
1.9
|
|
|
|
|
|
1.10
|
|
|
|
|
|
1.11
|
|
|
|
|
|
1.12
|
|
|
|
|
|
1.13
|
|
|
|
|
|
1.14
|
|
|
|
|
|
2.1
|
|
|
|
|
|
2.2
|
|
|
|
|
|
2.3
|
|
2.4
|
|
|
|
|
|
2.5
|
|
2.6
|
|
|
|
|
|
2.7
|
|
|
|
|
|
2.8
|
|
|
|
|
|
4.1
|
|
|
|
|
|
4.2
|
|
|
|
|
|
4.3
|
|
|
|
|
|
4.4
|
|
|
|
|
|
4.5
|
|
|
|
|
|
4.6
|
|
|
|
|
|
4.7
|
|
|
|
|
|
4.8
|
|
|
|
|
|
4.9
|
|
|
|
|
|
4.10
|
|
|
|
|
|
4.11
|
|
|
|
|
|
4.12
|
|
4.13
|
|
|
|
|
|
4.14
|
|
|
|
|
|
4.15
|
|
|
|
|
|
4.16
|
|
|
|
|
|
4.17
|
|
|
|
|
|
4.18
|
|
4.19
|
|
|
|
|
|
4.20
|
|
|
4.21
|
|
|
4.22
|
|
|
4.23
|
|
|
4.24
|
|
|
4.25
|
|
|
4.26
|
|
|
4.27
|
|
|
4.28
|
|
|
|
|
|
4.29
|
|
|
|
|
|
4.30
|
|
|
|
|
|
4.31
|
|
|
|
|
|
4.32
|
|
4.33
|
|
|
|
|
|
4.34
|
|
|
|
|
|
8.1
|
|
|
|
|
|
11.1
|
|
|
|
|
|
12.1
|
|
|
|
|
|
12.2
|
|
|
|
|
|
13.1
|
|
|
|
|
|
13.2
|
|
|
|
|
|
15.1
|
|
|
|
|
|
97.1
|
|
|
|
|
|
101
|
The following materials from the Company’s Annual Report on Form 20-F for the fiscal year ended December 31, 2023, formatted in Inline
eXtensible Business Reporting Language (iXBRL): (i) Consolidated Balance Sheets as of December 31, 2022 and 2023; (ii) Consolidated Statements of Comprehensive Income/(Loss) for the years ended December 31, 2021, 2022 and 2023; (iii)
Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2021, 2022 and 2023; (iv) Consolidated Statements of Cash Flows for the years ended December 31, 2021, 2022 and 2023; and (v) Notes to Consolidated
Financial Statements
|
|
|
|
|
104
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101
|
|
TOP SHIPS INC.
|
||
|
(Registrant)
|
||
|
Date:
March 29
, 2024
|
By:
|
/s/ Evangelos J. Pistiolis
|
|
Evangelos J. Pistiolis
|
||
|
President, Chief Executive Officer, and Director
|
||
TOP SHIPS INC.
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
|
December 31, |
December 31, |
|||||||
|
2022
|
2023
|
|||||||
|
ASSETS |
||||||||
|
|
||||||||
|
CURRENT ASSETS: |
||||||||
|
|
||||||||
|
Cash and cash equivalents |
|
|
||||||
|
Trade accounts receivable |
|
|
||||||
|
Prepayments and other |
|
|
||||||
|
Inventories |
|
|
||||||
|
Total current assets |
|
|
||||||
|
FIXED ASSETS: |
||||||||
|
Vessels, net (Note 4) |
|
|
||||||
|
Right of use assets from operating leases (Note 6) |
|
|
||||||
|
Other fixed assets, net |
|
|
||||||
|
Total fixed assets |
|
|
||||||
|
OTHER NON CURRENT ASSETS: |
||||||||
|
Restricted cash (Note 6 and 7) |
|
|
||||||
|
Investments in unconsolidated joint ventures (Note 16) |
|
|
||||||
|
Deposit asset
|
|
|
||||||
|
Deferred Charges
|
|
|
||||||
|
Total non-current assets |
|
|
||||||
|
Total assets |
|
|
||||||
|
LIABILITIE S, MEZZANINE EQUITY AND STOCKHOLDERS ’ EQUITY |
||||||||
|
CURRENT LIABILITIES: |
||||||||
|
Current portion of long-term debt (Note 7) |
|
|
||||||
|
Due to (Note 5) |
|
|
||||||
|
Accounts payable |
|
|
||||||
|
Accrued liabilities |
|
|
||||||
|
Unearned revenue |
|
|
||||||
|
Current portion of Operating lease liabilities (Note 6) |
|
|
||||||
|
Current portion of Vessel fair value participation liability (Note 7)
|
|
|
||||||
|
Total current liabilities |
|
|
||||||
|
NON-CURRENT LIABILITIES: |
||||||||
|
Non-current portion of long term debt (Note 7) |
|
|
||||||
|
Non-current portion of Operating lease liabilities (Note 6) |
|
|
||||||
|
Other non-current liabilities |
|
|
||||||
|
Vessel fair value participation liability (Note 7)
|
|
|
||||||
|
Total non-current liabilities |
|
|
||||||
|
COMMITMENTS AND CONTINGENCIES (Note 8) |
|
|
||||||
|
Total liabilities |
|
|
||||||
|
MEZZANINE EQUITY: |
||||||||
|
Preferred stock, $
|
|
|
||||||
|
Preferred stock, Paid-in capital in excess of par
|
|
|
||||||
|
Total mezzanine equity |
|
|
||||||
|
STOCKHOLDERS ’ EQUITY: |
||||||||
|
Preferred stock, $
|
|
|
||||||
|
Common stock, $
|
|
|
||||||
|
Additional paid-in capital |
|
|
||||||
|
Accumulated deficit |
(
|
) |
(
|
) | ||||
|
Total stockholders ’ equity |
|
|
||||||
|
|
||||||||
|
Total liabilities, mezzanine equity and stockholders ’ equity |
|
|
||||||
The accompanying notes are an integral part of these consolidated financial statements.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE YEARS ENDED DECEMBER 31, 2021, 2022 and 2023
|
2021
|
2022
|
2023
|
||||||||||
|
Revenues
(including $
|
|
|
|
|||||||||
|
EXPENSES: |
||||||||||||
|
Voyage expenses (including $
|
|
|
|
|||||||||
|
Operating lease expense (Note 6) |
|
|
|
|||||||||
|
Vessel operating expenses (including $
|
|
|
|
|||||||||
|
Dry-docking costs |
|
|
|
|||||||||
|
Vessel depreciation (Note 4) |
|
|
|
|||||||||
|
Management fees-related parties (Note 5) |
|
|
|
|||||||||
|
General and administrative expenses (including $
|
|
|
|
|||||||||
|
Gain on sale of vessels |
|
(
|
) |
|
||||||||
|
Impairment of vessels |
|
|
|
|||||||||
|
Operating income |
|
|
|
|||||||||
|
|
||||||||||||
|
OTHER EXPENSES: |
||||||||||||
|
Interest and finance costs (including $
|
(
|
) |
(
|
) |
(
|
) | ||||||
|
Gain on derivative financial instruments (Note 14) |
|
|
|
|||||||||
|
Interest income |
|
|
|
|||||||||
|
Equity gain/(loss) in unconsolidated joint ventures |
|
|
(
|
) | ||||||||
|
Total other expenses, net |
(
|
) |
(
|
) |
(
|
) | ||||||
|
Net income and comprehensive income |
|
|
|
|||||||||
|
Less: Deemed dividend for beneficial conversion feature of Series E Shares (Note 15) |
(
|
) |
|
|
||||||||
|
Less: Deemed dividend equivalents on preferred shares related to redemption value (Note 15) |
(
|
) |
(
|
) |
|
|||||||
|
Less: Preferred shares dividend (Note 15) |
(
|
) |
(
|
) |
(
|
) | ||||||
|
Less: Deemed dividend
on warrant inducement (Note 9)
|
|
(
|
) |
|
||||||||
|
Less: Deemed dividend on Series E Shares conversion
|
|
|
(
|
) | ||||||||
|
Net income/ (loss) attributable to common shareholders |
|
(
|
) |
(
|
) | |||||||
|
Earnings/(Loss) per common share, basic and diluted (Note 10) |
|
(
|
) |
(
|
) | |||||||
The accompanying notes are an integral part of these consolidated financial statements.
TOP SHIPS INC.
CONSOLIDATED STATEMENTS OF MEZZANINE AND STOCKHOLDERS ’ EQUITY
FOR THE YEARS ENDED DECEMBER 31, 2021, 2022 and 2023
(Expressed in thousands of U.S. Dollars – except number of shares and per share data)
|
Mezzanine Equity
|
Preferred Stock
|
Common Stock
|
Additional |
Accumulated Deficit
attributable
|
||||||||||||||||||||||||||||||||||||
|
# of Shares |
Par
Value
|
Mezzanine Equity |
# of Shares |
Par Value |
# of Shares* |
Par Value* |
Paid-In Capital* |
to common stockholders |
Total |
|||||||||||||||||||||||||||||||
|
BALANCE, December 31, 2020 |
|
|
|
|
|
|
|
|
(
|
) |
|
|||||||||||||||||||||||||||||
|
Net Income |
|
|
||||||||||||||||||||||||||||||||||||||
|
Stock-based compensation |
(
|
) |
(
|
) | ||||||||||||||||||||||||||||||||||||
|
Issuance of Series E Shares (Note 15) |
|
|
|
- | ||||||||||||||||||||||||||||||||||||
|
Deemed dividend equivalents on Series E Shares issued during the period related to redemption value |
|
(
|
) |
(
|
) | |||||||||||||||||||||||||||||||||||
|
Dividends of Series E shares (Note 15) |
(
|
) |
(
|
) | ||||||||||||||||||||||||||||||||||||
|
Beneficial conversion feature related to the issuance of Series E Shares |
(
|
) |
|
|
||||||||||||||||||||||||||||||||||||
|
Deemed dividend related to beneficial conversion feature of Series E Shares |
|
(
|
) |
(
|
) | |||||||||||||||||||||||||||||||||||
|
Excess of consideration over carrying value of acquired assets (Note 1) |
(
|
) |
(
|
) | ||||||||||||||||||||||||||||||||||||
|
BALANCE, December 31, 2021 |
|
|
|
|
|
|
|
|
(
|
) |
|
|||||||||||||||||||||||||||||
|
Net Income |
|
|
||||||||||||||||||||||||||||||||||||||
|
Stock-based compensation |
(
|
) |
(
|
) | ||||||||||||||||||||||||||||||||||||
|
Redemption of fractional shares due to reverse stock split |
(
|
) |
(
|
) |
(
|
) | ||||||||||||||||||||||||||||||||||
|
Issuance of preferred shares (Note 15) |
|
|
|
- | ||||||||||||||||||||||||||||||||||||
|
Deemed dividend of Series F shares related to redemption value |
|
(
|
) |
(
|
) | |||||||||||||||||||||||||||||||||||
|
Dividends of preferred shares (Note 15) |
(
|
) |
(
|
) | ||||||||||||||||||||||||||||||||||||
|
Exercise of warrants, net of fees |
|
|
|
|
||||||||||||||||||||||||||||||||||||
|
Redemptions of preferred shares (Note 15) |
(
|
) |
(
|
) |
(
|
) | - | |||||||||||||||||||||||||||||||||
|
Issuance of common stock pursuant to equity offerings, net (Note 9)
|
|
|
|
|
||||||||||||||||||||||||||||||||||||
|
Deemed dividend on warrant inducement (Note 9)
|
(
|
) |
(
|
) | ||||||||||||||||||||||||||||||||||||
|
Incremental fair value of the October 2022 Warrants (Note 9)
|
|
|
||||||||||||||||||||||||||||||||||||||
|
BALANCE, December 31, 2022 |
|
|
|
|
|
|
|
|
(
|
) |
|
|||||||||||||||||||||||||||||
|
Net Income
|
|
|
||||||||||||||||||||||||||||||||||||||
|
Redemption of fractional shares due to reverse stock split
|
(
|
) |
|
|||||||||||||||||||||||||||||||||||||
|
Conversion of Series E Shares (Note 15)
|
(
|
) |
|
(
|
) |
|
|
|
|
|||||||||||||||||||||||||||||||
|
Deemed dividend on Series E Shares conversion (Note 15)
|
(
|
) |
(
|
) | ||||||||||||||||||||||||||||||||||||
|
Dividends of preferred shares (Note 15)
|
(
|
) |
(
|
) | ||||||||||||||||||||||||||||||||||||
|
Exercise of warrants, net of fees
|
|
|
|
|||||||||||||||||||||||||||||||||||||
|
Redemptions of preferred shares (Note 15)
|
(
|
) |
(
|
) |
(
|
) | - | |||||||||||||||||||||||||||||||||
|
Issuance of common stock pursuant to equity offerings, net (Note 9)
|
|
|
|
|
||||||||||||||||||||||||||||||||||||
| BALANCE, December 31, 2023 |
|
|
|
|
|
|
|
|
(
|
) |
|
|||||||||||||||||||||||||||||
The accompanying notes are an integral part of these consolidated financial statements.
*
TOP SHIPS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2021, 2022 and 2023
(Expressed in thousands of U.S. Dollars)
|
2021
|
2022
|
2023
|
||||||||||
|
Cash Flows from Operating Activities: |
||||||||||||
|
Net income |
|
|
|
|||||||||
|
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||||||
|
Vessel depreciation |
|
|
|
|||||||||
|
Other fixed assets depreciation |
|
|
|
|||||||||
|
Equity (gains)/losses in unconsolidated joint ventures |
(
|
) |
(
|
) |
|
|||||||
|
Dividends from cumulative earnings of joint venture |
|
|
|
|||||||||
|
Amortization and write off of deferred financing costs and debt discounts |
|
|
|
|||||||||
|
Stock-based compensation expense |
(
|
) |
(
|
) |
|
|||||||
|
Change in fair value of derivative financial instruments |
(
|
) |
|
|
||||||||
|
Amortization of Right of use assets from operating leases
|
|
|
|
|||||||||
|
Impairment on vessels |
|
|
|
|||||||||
|
Gain on sale of other fixed assets
|
|
(
|
) |
|
||||||||
|
Gain on sale of vessels
|
|
(
|
) |
|
||||||||
|
(Increase)/Decrease in: |
||||||||||||
|
Trade accounts receivable |
(
|
) |
|
(
|
) | |||||||
|
Inventories |
(
|
) |
(
|
) |
|
|||||||
|
Prepayments and other |
|
(
|
) |
(
|
) | |||||||
|
Increase/(Decrease) in: |
||||||||||||
|
Due to related parties |
(
|
) |
(
|
) |
|
|||||||
|
Accounts payable |
(
|
) |
(
|
) |
(
|
) | ||||||
|
Other non-current liabilities |
(
|
) |
(
|
) |
(
|
) | ||||||
|
Accrued liabilities |
(
|
) |
|
|
||||||||
|
Unearned revenue |
|
|
(
|
) | ||||||||
|
Operating lease liabilities
|
(
|
) |
(
|
) |
(
|
) | ||||||
|
Net Cash provided by Operating Activities |
|
|
|
|||||||||
|
Cash Flows used in Investing Activities: |
||||||||||||
|
Advances for vessels under construction and capitalized expenses |
(
|
) |
(
|
) |
|
|||||||
|
Returns of investments in unconsolidated joint ventures (2020 Joint Venture – see Note 16) |
|
|
|
|||||||||
|
Net proceeds from vessel sales |
|
|
|
|||||||||
|
Net proceeds from sales of other fixed assets, net
|
|
|
|
|||||||||
|
Net Cash (used in)/ provided by Investing Activities
|
(
|
) |
(
|
) |
|
|||||||
|
Cash Flows from Financing Activities: |
||||||||||||
|
Proceeds from debt |
|
|
|
|||||||||
|
Proceeds from related party debt
|
|
|
|
|||||||||
|
Principal payments and prepayments of related party debt
|
|
(
|
) |
|
||||||||
|
Principal payments and prepayments of debt |
(
|
) |
(
|
) |
(
|
) | ||||||
|
Redemption of preferred shares
|
|
(
|
) |
(
|
) | |||||||
|
Proceeds from issuance of common stock |
|
|
|
|||||||||
|
Proceeds from warrant exercises, net of fees
|
|
|
|
|||||||||
|
Equity offering issuance costs |
|
(
|
) |
(
|
) | |||||||
|
Payment of financing costs |
(
|
) |
(
|
) |
(
|
) | ||||||
|
Dividends of preferred shares
|
(
|
) |
(
|
) |
(
|
) | ||||||
|
Proceeds from issuance of preferred shares (Note 15)
|
|
|
|
|||||||||
|
Redemption of fractional shares due to reverse stock split
|
|
(
|
) |
|
||||||||
|
Net Cash provided by/(used in) Financing Activities |
|
|
(
|
) | ||||||||
|
Net (decrease)/increase in cash and cash equivalents and restricted cash |
(
|
) |
|
|
||||||||
|
Cash and cash equivalents and restricted cash at beginning of year |
|
|
|
|||||||||
|
Cash and cash equivalents and restricted cash at end of the year |
|
|
|
|||||||||
|
Cash breakdown |
||||||||||||
|
Cash and cash equivalents |
|
|
|
|||||||||
|
Restricted cash, current |
|
|
|
|||||||||
|
Restricted cash, non-current |
|
|
|
|||||||||
|
SUPPLEMENTAL CASH FLOW INFORMATION |
||||||||||||
|
Capital expenditures included in Accounts payable/Accrued liabilities/Due to related parties |
|
|
|
|||||||||
|
Interest paid, net of capitalized interest |
|
|
|
|||||||||
|
Finance fees included in Accounts payable/Accrued liabilities/Due to related parties |
|
|
|
|||||||||
|
Equity issuance costs and warrant related costs included in liabilities
|
|
|
|
|||||||||
|
Unpaid Excess of consideration over carrying value of acquired assets included in Due to Related Parties (Note 1) |
|
|
|
|||||||||
|
Beneficial conversion feature of Series E perpetual convertible preferred stock
|
|
|
|
|||||||||
|
Settlement of related party debt, interest, finance fees, Excess consideration over acquired assets,
capital expenditures and dividends with issuance of preferred shares (Note 15)
|
|
|
|
|||||||||
|
Dividends payable included in Due to related parties
|
|
|
|
|||||||||
|
Carrying value of net assets of companies acquired (Note 1) |
|
|
|
|||||||||
|
Deemed dividend equivalents on preferred shares related to redemption value (Note 15)
|
|
|
|
|||||||||
|
Deemed dividend on warrant inducement (Note 9)
|
|
|
|
|||||||||
|
Deemed dividend on Series E Shares conversion
|
|
|
|
|||||||||
The accompanying notes are an integral part of these consolidated financial statements.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2022 AND 2023
AND FOR THE YEARS ENDED DECEMBER 31, 2021, 2022 and 2023
(Expressed in thousands of United States Dollars
–
except share, per share earnings and rate per day, unless otherwise stated)
|
1. |
Basis of Presentation and General Information: |
The consolidated financial statements include the accounts of Top Ships Inc. (formerly Top Tankers Inc. and Ocean Holdings Inc.) and its wholly owned subsidiaries (collectively the “Company”). Ocean Holdings Inc. was formed on January 10, 2000, under the laws of Marshall Islands and was renamed to Top Tankers Inc. and Top Ships Inc. in May 2004 and December 2007, respectively. The Company is an international provider of worldwide oil, petroleum products and chemicals transportation services.
As of
December 31, 2023, the Company was the sole owner of all outstanding shares of the following subsidiary companies. The following list is not exhaustive as the Company has other subsidiaries relating to vessels that have been sold and that remain
dormant for the periods presented in these consolidated financial statements as well as intermediary companies that own shipowning companies that are
|
Companies |
Date of Incorporation |
Country of Incorporation |
Activity |
|
Top Tanker Management Inc. |
|
|
|
|
Wholly owned Shipowning Companies ( “ SPC ” ) with vessels in operation during years ended December 31, 2021, 2022 and 2023 |
Date of Incorporation |
Country of Incorporation |
Vessel |
Delivery Date |
|
|
1
|
Monte Carlo Lax Shipping Company Limited |
|
|
|
( sold in ) |
|
2
|
PCH Dreaming Inc. |
|
|
|
|
|
3
|
Roman Empire Inc. |
|
|
|
|
|
4
|
Athenean Empire Inc. |
|
|
|
|
|
5
|
Julius Caesar Inc.
|
|
|
|
|
|
6
|
Legio X Inc.
|
|
|
|
|
|
7
|
Eco Oceano CA Inc.
|
|
|
|
|
As of December 31, 2021, 2022 and 2023, the Company was the owner of
|
|
SPC |
Date of Incorporation |
Country of Incorporation |
Vessel |
Built Date |
|
1
|
California 19 Inc. |
|
|
|
|
|
2
|
California 20 Inc. |
|
|
|
|
On January
6, 2021 the Company sold to a related party affiliated with the Company’s Chief Executive Officer, President and director, Mr. Evangelos J. Pistiolis (the “Buyer”) the
|
● |
$
|
|
|
● |
|
|
|
● |
|
|
|
● |
|
|
|
● |
A settlement of $
|
The Buyer remained the guarantor on the shipbuilding contracts towards the shipyard and in addition, the Buyer provided the Company with an option for a credit line up to
On September
8, 2021 the Company purchased from the Buyer for a consideration of $
Due to the
abovementioned purchase of the remaining
Each of the abovementioned transactions were approved by a special committee of the Company’s board of directors (the “Special Committee”), of which all of the directors were independent and for each transaction the Special Committee obtained a fairness opinion relating to the consideration of each transaction from an independent financial advisor. The Company accounted for the abovementioned acquisitions as a transfer of assets between entities under common control and has recognized the vessels at their historical carrying amounts at the date of transfer.
The amount of the consideration given in excess of the historical carrying value of the net assets acquired is recognized as a reduction to the Company’s additional paid in capital and presented as Excess of consideration over the carrying value of acquired assets in the Company’s consolidated statement of stockholders’ equity for the twelve months ended December 31, 2021, 2022 and 2023 respectively. An analysis of the consideration paid is presented in the table below:
|
As of December 31, |
2021
|
2022
|
2023
|
|||||||||
|
Consideration |
|
|
|
|||||||||
|
Carrying value of net assets of companies sold |
|
|
|
|||||||||
|
Less: Carrying value of net assets of companies acquired |
(
|
) |
|
|
||||||||
|
Less: Consideration received in cash |
(
|
) |
|
|
||||||||
|
Less: Settlement of related party payables |
(
|
) |
|
|
||||||||
|
Excess of consideration over acquired assets |
|
|
|
|||||||||
On September 29, 2023 the Company effected a reverse stock split of its common stock. There was no change in the number of authorized common shares of the Company, or the floor price of the Company’s Series E Shares, or the number of votes of the Company’s Series D, E and F Shares. All numbers of common share and earnings per share amounts, as well as warrant shares eligible for purchase under the Company’s warrants, exercise price of said warrants and conversion prices of the Company’s Series E Shares, in these consolidated financial statements have been retroactively adjusted to reflect this reverse stock split.
|
2. |
Significant Accounting Policies: |
|
(a) |
Principles of Consolidation: The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and include the accounts and operating results of Top Ships Inc. and its subsidiaries referred to in Note 1. Intercompany balances and transactions have been eliminated on consolidation. Non-controlling interests are stated at the non-controlling interest’s proportion of the net assets of the subsidiaries where the Company has less than 100% interest. Subsequent to initial recognition the carrying amount of non-controlling interest is increased or decreased by the non-controlling interest’s share of subsequent changes in the equity of such subsidiaries. Total comprehensive income is attributed to a non-controlling interest even if this results in a deficit balance. Changes in the Company’s ownership interests in subsidiaries that do not result in the Company losing control over the subsidiaries are accounted for as equity transactions and the carrying amounts of the Company’s interests and the non-controlling interests are adjusted to reflect these changes in their relative interests in the subsidiaries. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity and attributed to owners of the Company. |
|
(b) |
Use of Estimates: The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates mainly include impairment of vessels, vessel useful lives and residual values and fair values of derivative instruments. Actual results may differ from these estimates. |
|
(c) |
Foreign Currency Translation: The Company’s functional currency is the U.S. Dollar because all vessels operate in international shipping markets, and therefore primarily transact business in U.S. Dollars. The Company’s books of account are maintained in U.S. Dollars. Transactions involving other currencies during the year are converted into U.S. Dollars using the exchange rates in effect at the time of the transactions. At the balance sheet dates, monetary assets and liabilities, which are denominated in other currencies are translated to U.S. Dollars based on the year-end exchange rates and any gains and losses are included in the statement of comprehensive income. |
|
(d) |
Cash and Cash Equivalents: The Company considers highly liquid investments such as time deposits and certificates of deposit with an original maturity of three months or less to be cash equivalents. |
|
(e) |
Restricted Cash: The Company considers amounts that are pledged, blocked, held as cash collateral, required to be maintained with a specific bank or be maintained by the Company as minimum cash under the terms of a loan agreement, as restricted and these amounts are presented separately on the balance sheets. In the event original maturities are shorter than twelve months, such deposits are presented as current assets while if original maturities are longer than twelve months, such deposits are presented as non-current assets. |
|
(f) |
Trade Accounts Receivable, net:
The amount shown as trade accounts receivable, net at each balance sheet date, includes estimated recoveries from charterers for
hire billings, net of a provision for doubtful accounts and also accrued revenue resulting from straight-line revenue recognition of charter agreements that provide for varying charter rates. At each balance sheet date, all potentially
uncollectible accounts are assessed individually, combined with the application of a historical recoverability ratio, for purposes of determining the appropriate provision for doubtful accounts. The Company assessed that it had
no
potentially uncollectible accounts and hence formed
|
|
(g) |
Inventories: Inventories consist of lubricants, bonded stores and spares on board the vessels. Inventories are stated at the lower of cost and net realizable value. Cost, which consists of the purchase price, is determined by the first in, first out method. |
|
(h) |
Vessel Cost: Vessels are stated at cost, which consists of the contract price, pre-delivery costs and capitalized interest incurred during the construction of new building vessels, and any material expenses incurred upon acquisition (improvements and delivery costs). Subsequent expenditures for conversions and major improvements are also capitalized when they appreciably extend the life, increase the earning capacity or improve the efficiency or safety of the vessels. Repairs and maintenance are charged to expense as incurred and are included in Vessel operating expenses in the consolidated statements of comprehensive income. |
|
(i) |
Impairment of Long-Lived Assets:
The Company evaluates the existence of impairment indicators whenever events or changes in circumstances indicate that the
carrying values of the Company’s long lived assets are
not
recoverable. Such indicators of potential impairment include, vessel sales and purchases,
business plans, declines in the fair market value of vessels and overall market conditions. If there are indications for impairment present, the Company determines undiscounted projected net operating cash flows for each vessel and compares
it to the vessel’s carrying value. If the carrying value of the related vessel exceeds its undiscounted future net cash flows, the carrying value is reduced to its fair value, and the difference is recognized as an impairment loss. The
impairment evaluation the Company conducted as of
December 31, 2022
and
2023
showed that there are
|
|
(j) |
Vessel Depreciation:
Depreciation is calculated using the straight-line method over the estimated useful life of the vessels, after deducting the estimated salvage
value. Each vessel’s salvage value is equal to the product of its lightweight tonnage and estimated scrap rate, of $
|
|
(k) |
Long Lived Assets Held for Sale: The Company classifies vessels as being held for sale when the following criteria are met: (a) management, having the authority to approve the action, commits to a plan to sell the asset, (b) the asset is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets, (c) an active program to locate a buyer and other actions required to complete the plan to sell the asset have been initiated, (d) the sale of the asset is probable and transfer of the asset is expected to qualify for recognition as a completed sale, within one year, (e) the asset is being actively marketed for sale at a price that is reasonable in relation to its current fair value, (f) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. |
|
|
Long-lived assets classified as held for sale are measured at the lower of their carrying amount or fair value less costs to sell. These vessels are
not
depreciated once they meet the criteria to be classified as held for sale.
|
|
|
Long-lived assets previously classified as held for sale that are classified as held and used are revalued at the lower of (a) the carrying amount of the asset before it was classified as held for sale, adjusted for any depreciation expense that would have been recognized had the asset been continuously classified as held and used and (b) the fair value of the asset at the date that the Company decided not to sell the asset. |
|
(l) |
Other Fixed Assets, Net: Other fixed assets, net, consist of furniture, office equipment, and cars, stated at cost, which consists of the purchase/contract price less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful life of the assets as presented below: |
|
Description |
Useful Life (years) |
|||
|
Cars |
|
|
||
|
Office equipment |
|
|||
|
Furniture and fittings |
|
|||
|
Computer equipment |
|
|||
|
Art works
|
∞
|
|||
| (m) |
Accounting for Dry-Docking Costs:
All dry-docking and special survey costs are expensed in the period incurred.
|
| (n) |
Financing Costs:
Fees incurred and paid to the lenders for obtaining new loans or refinancing existing ones are
recorded as a contra to debt and such fees are amortized to interest and finance costs over the life of the related debt using the effective interest method. Any unamortized balance of costs relating to debt repaid or refinanced that meet
the criteria for Debt Extinguishment (Subtopic 470-50), is expensed in interest and finance costs in the period in which the repayment is made or refinancing occurs. Any unamortized balance of costs relating to debt refinanced that do not
meet the criteria for Debt Extinguishment, are amortized over the term of the refinanced debt.
|
| (o) |
Accounting for Revenue and Expenses:
Revenues are generated from time charter arrangements. A time charter is a
contract for the use of a vessel for a specific period of time and a specified daily charter hire rate, which is generally payable monthly in advance. Revenue is shown net of address commissions, if applicable, payable directly to
charterers under the relevant charter agreements. Address commissions represent a common market practice discount (sales incentive) on services rendered by the Company and no identifiable benefit is received in exchange for the
consideration provided to the charterer. Commissions on time charter revenues are recognized on a pro rata basis over the duration of the period.
|
|
The Company based on ASC
842
determined that all time charter-out contracts are considered operating leases and therefore fall under
the scope of ASC
842
because: (i) the vessel is an identifiable asset; (ii) the Company as lessor, does
not
have substantive substitution rights; and (iii)
the charterer, as lessee, has the right to control the use of the vessel during the term of the contract and derives the economic benefits from such use.
|
|
Time charter revenue is recognized as earned on a straight-line basis over the term of the relevant time charter starting from the vessel’s delivery to the charterer until the
vessel is redelivered to the Company, except for any off-hire period. Revenue generated from variable lease payments is recognized in the period when changes in the facts and circumstances on which the variable lease payments are based
occur. The Company elected to not separate the lease and non-lease components included in the time charter revenue because (i) the pattern of revenue recognition for the lease and non-lease components (included in the daily hire rate) is
the same and (ii) the lease component would be classified as an operating lease. The daily hire rate represents the hire rate for a bare boat charter as well as the compensation for expenses incurred running the vessel such as crewing
expense, repairs, insurance, maintenance and lubes. Both the lease and non-lease components are earned by passage of time. Under a time charter agreement, vessel operating expenses such as management fees, crew wages, provisions and stores,
technical maintenance and insurance expenses and broker’s commissions are paid by the vessel owner, whereas voyage expenses such as bunkers, port expenses, agents’ fees, and extra war risk insurance are paid by the charterer. Vessel
operating expenses are expensed as incurred. Unearned revenue represents cash received prior to year-end related to revenue applicable to periods after December 31 of each year and also amounts resulting from straight-line revenue
recognition of charter agreements that provide for varying charter rates.
|
|
When vessels are acquired with time charters attached and the rates on such charters are below or above market on the acquisition date, the Company allocates the total cost
between the vessel and the fair value of the attached time charter based on the relative fair values of the vessel and time charter acquired. The fair value of the attached time charter is computed as the present value of the difference
between the contractual amount to be received over the term of the time charter and management’s estimates of the market time charter rate at the time of acquisition. The fair value of below or above market time charter is recognized as a
liability or an intangible asset respectively and is amortized over the remaining period of the time charter as an increase or decrease to revenues.
|
|
Where the time charter contains a profit or loss sharing arrangement, the profit or loss is recognized based on amounts earned or incurred as of the reporting date.
|
|
The Company pays commissions to ship brokers and to the Company’s fleet manager (Note 5), a related party affiliated with the family of Mr. Evangelos J. Pistiolis, associated
with arranging the Company’s charters. These brokers’ commissions are recognized over the related charter period and are included in voyage expenses.
|
| (p) |
Earnings / (Loss) per Share:
Basic earnings/(loss) per share are computed by dividing net income or loss available to common stockholders by the weighted average number of common shares outstanding during the
year. Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue common stock were exercised. For purposes of calculating diluted earnings per share the denominator of the
diluted earnings per share calculation includes the incremental shares assumed issued under the treasury stock method weighted for the period the non-vested shares were outstanding. The computation of diluted earnings per share also
reflects the potential dilution that could occur if warrants to issue common stock were exercised, to the extent that they are dilutive, using the treasury stock method, the potential dilution that could occur if convertible preferred
stock were converted, using the if-converted method as well as the potential dilution that could occur if the Company completed all sales pursuant to common stock purchase agreements, using the if-converted method. Finally net income
or loss available to common stockholders, when computing basic earnings/(loss) per share, is reduced to reflect any dividends or deemed dividends on preferred stock.
|
| (q) |
Derivatives and Hedging, Hedge Accounting
: The Company records every derivative instrument (including certain
derivative instruments embedded in other contracts) on the balance sheet as either an asset or liability measured at its fair value, with changes in the derivatives’ fair value recognized in earnings unless specific hedge accounting
criteria are met.
|
|
At the inception of a hedge relationship, the Company formally designates and documents the hedge relationship to which the Company wishes to apply hedge accounting and the
risk management objective and strategy undertaken for the hedge. The documentation includes identification of the hedging instrument, hedged item or transaction, the nature of the risk being hedged and how the entity will assess the
hedging instrument’s effectiveness in offsetting exposure to changes in the hedged item’s cash flows attributable to the hedged risk. Such hedges are expected to be highly effective in achieving offsetting changes in cash flows and are
assessed on an ongoing basis to determine whether they actually have been highly effective throughout the financial reporting periods for which they were designated. Contracts which meet the criteria for hedge accounting are accounted for
as cash flow hedges. A cash flow hedge is a hedge of the exposure to variability in cash flows that is attributable to a particular risk associated with a recognized asset or liability, or a highly probable forecasted transaction that
could affect profit or loss. The effective portion of the gain or loss on the hedging instrument is recognized directly as a component of “Accumulated other comprehensive income” in equity, while the ineffective portion, if any, is
recognized immediately in current period earnings. The Company discontinues cash flow hedge accounting if the hedging instrument expires and it
no
longer meets the criteria for hedge accounting or
designation is revoked by the Company. At that time, any cumulative gain or loss on the hedging instrument recognized in equity is kept in equity until the forecasted transaction occurs. When the forecasted transaction occurs, any
cumulative gain or loss on the hedging instrument is recognized in the statement of income. If a hedged transaction is
no
longer expected to occur, the net cumulative gain or loss recognized in
equity is transferred to net profit or loss for the year as a component of “Gain/(Loss) on derivatives”.
|
| (r) |
Financial liabilities:
Financial liabilities are classified as either
financial liabilities at ‘fair value through the profit and loss’ (“FVTPL”) or ‘other financial liabilities’. Financial instruments classified as FVTPL are recognized at fair value in the balance sheet when the Company has an obligation
to perform under the contractual provisions of those instruments. Financial instruments are classified as liabilities or equity in accordance with the substance of the contractual arrangement. Changes in the fair value of financial
instruments are recognized in earnings, except in the cases where these financial instruments fall under the guidance in ASC
815
-
40,
where they are
initially classified in equity and are initially measured at fair value in permanent equity and subsequent changes in fair value are
not
subsequently measured. Other financial liabilities
(including borrowings and trade and other payables) are subsequently measured at amortized cost using the effective interest rate method.
|
| (s) |
Segment Reporting:
The Chief Operating Decision Maker (“CODM”), Mr. Evangelos J. Pistiolis, receives financial
information and evaluates the Company’s operations by charter revenues and
not
by the length, type of vessel or type of ship employment for its customers or by geographical region as the
charterer is free to trade the vessel worldwide and as a result, the disclosure of geographic information is impracticable. The CODM does
not
use discrete financial information to evaluate the
operating results for each such type of charter or vessel. Although revenue can be identified for these types of charters or vessels, management cannot and does
not
identify expenses,
profitability or other financial information for these various types of charters or vessels. As a result, management, including the CODM, reviews operating results solely by revenue per day and operating results of the fleet, and thus
the Company has determined that it operates as
|
| (t) |
Leases:
|
|
|
● |
Sale-leaseback transactions:
In accordance with ASC
842,
the Company,
as seller-lessee, determines whether the transfer of an asset should be accounted for as a sale in accordance with ASC
606
(existence of a contract and satisfaction of performance obligation by
transferring of the control of the asset). The existence of an option for the seller-lessee to repurchase the asset precludes the accounting for the transfer of the asset as a sale unless both of the following criteria are met: (
1
) the exercise price of the option is the fair value of the asset at the time the option is exercised; and (
2
) there are alternative assets, substantially
the same as the transferred asset, readily available in the marketplace. If the transfer of the asset meets the criteria of sale, the Company, as seller-lessee recognizes the transaction price for the sale when the buyer-lessor obtains
control of the asset, derecognizes the carrying amount of the underlying asset and accounts for the lease in accordance with ASC
842.
If the transfer does
not
meet the criteria of sale, the Company does
not
derecognize the transferred asset, accounts for any amounts received as a financing arrangement and recognizes the difference between the amount
of consideration received and the amount of consideration to be paid as interest.
|
|
|
● |
Finance lease:
The Company classifies a lease as a finance lease when the lease meets any of the following
criteria at lease commencement:
|
|
|
i.
|
The lease transfers ownership of the underlying asset to the lessee by the end of the lease term.
|
|
|
ii.
|
The lease grants the lessee an option to purchase the underlying asset that the lessee is reasonably certain to exercise.
|
|
|
iii.
|
The lease term is for the major part of the remaining economic life of the underlying asset. However, if the commencement date falls at or near the end of the economic life
of the underlying asset, this criterion shall
not
be used for purposes of classifying the lease.
|
|
|
iv.
|
The present value of the sum of the lease payments and any residual value guaranteed by the lessee that is
not
already reflected in
the lease payments equals or exceeds substantially all of the fair value of the underlying asset.
|
|
|
v.
|
The underlying asset is of such a specialized nature that it is expected to have
no
alternative use to the lessor at the end of the
lease term.
|
|
● |
Operating lease- The Company as a lessee : The Company recognizes right-of-use assets (“ROU”) and corresponding lease liabilities for its operating leases. ROU assets and liabilities are recognized at the commencement date of an arrangement based on the present value of lease payments over the lease term. The operating lease ROU asset also includes any lease payments made to the lessor prior to lease commencement, less any lease incentives, and initial direct costs incurred. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term. |
| (u) |
Beneficial conversion feature:
A beneficial conversion feature is defined as a non-detachable conversion feature
that is in the money at the commitment date. The beneficial conversion feature guidance requires recognition of the intrinsic value of the option, which is the in-the- money portion of the conversion option, in equity, with an offsetting
reduction to the carrying amount of the instrument. The resulting discount is amortized as a deemed dividend over either the life of the instrument, if a stated maturity date exists, or to the earliest conversion date, if there is
no
stated maturity date. If the earliest conversion date is immediately upon issuance, the dividend must be recognized at inception.
|
| (v) |
Investments in unconsolidated joint ventures:
The Company’s investments in unconsolidated joint ventures are
accounted for using the equity method of accounting. Under the equity method of accounting, investments are stated at initial cost and are adjusted for subsequent additional investments and the Company’s proportionate share of earnings or
losses and distributions. The Company evaluates its investments in unconsolidated joint ventures for impairment when events or circumstances indicate that the carrying value of such investments
may
have
experienced other than temporary decline in value below their carrying value. If the estimated fair value is less than the carrying value and is considered other than a temporary decline, the carrying value is written down to its estimated
fair value and the resulting impairment is recorded in the Consolidated Statements of comprehensive income.
|
| (w) |
Other Comprehensive Income:
The Company follows the provisions of guidance regarding reporting comprehensive income
which requires separate presentation of certain transactions, such as unrealized gains and losses from effective portion of cash flow hedges, which are recorded directly as components of stockholders’ equity
|
| (x) |
Impairment of Right of use assets from operating leases:
The Company evaluates its Right of use assets from
operating leases for potential impairment when it determines a triggering event has occurred. When a triggering event has occurred, the Company performs a test of recoverability by comparing the expected undiscounted future cash flows
(including expected residual values) over the remaining lease terms to the carrying value of the Right of use asset. If the test of recoverability identifies a possible impairment, the Right of use asset’s fair value is measured in
accordance with the fair value measurement framework. An impairment charge is recognized for the amount by which the carrying value of the Right of use asset exceeds its estimated fair value and would be recorded in the Consolidated
Statements of comprehensive income. For the years ended December 31, 2022, and 2023 there was
|
| (y) |
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, updated in December 2022 by ASU No. 2022-06, Deferral of Sunset Date of Topic 848. The ASUs apply to all entities that have
contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The ASUs provide optional expedients and exceptions for applying GAAP to
contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The expedients and exceptions provided by the ASUs do not apply to contract modifications made and hedging
relationships entered into or evaluated after December 31, 2024, except for hedging relationships existing as of December 31, 2024, that an entity has elected certain optional expedients for and that are retained through the end of the
hedging relationship. ASU 2020-04, as updated by ASU 2022-06, is effective for all entities as of March 12, 2020, through December 31, 2024. The impact of the adoption in the second half of the year ended December 31, 2023 did not have a
material impact on the Company’s consolidated financial statements.
|
|
There are no
other recent accounting pronouncements the adoption of which is expected to have a material effect on the Company’s consolidated financial statements in the current period.
|
|
3. |
Going Concern: |
At December 31, 2023, the Company had a working
capital deficit of $
|
4 . |
Vessels, net: |
The amounts in the consolidated balance sheets are analyzed as follows:
|
Vessel Cost |
Accumulated Depreciation |
Net Book Value |
||||||||||
|
Balance, December 31, 2021 |
|
(
|
) |
|
||||||||
|
— Transferred from advances for vessels under construction |
|
- |
|
|||||||||
|
— Depreciation |
- |
(
|
) |
(
|
) | |||||||
|
Balance, December 31, 2022 |
|
(
|
) |
|
||||||||
|
— Depreciation |
- |
(
|
) |
(
|
) | |||||||
|
Balance, December 31, 2023 |
|
(
|
) |
|
||||||||
In 2022, the Company took delivery of the following vessels and hence advances paid and capitalized expenses relating to these vessels were transferred from Advances for vessels under construction to Vessels, net:
|
Vessel Name |
Delivery Date |
Yard Installments |
Capitalized Expenses |
Final Cost |
|||||||||
|
M/T Julius Caesar |
|
|
|
|
|||||||||
|
M/T Legio X Equestris |
|
|
|
|
|||||||||
|
M/T Eco Oceano CA
|
|
|
|
|
|||||||||
|
Total 2022 |
|
|
|
||||||||||
As of December 31, 2023 all the titles of ownership of our vessels are held by the respecting vessel lenders to secure the relevant sale and lease back financing transactions (see Note 7).
|
5. |
Transactions with Related Parties: |
As of December 31, 2022 and 2023 there are
The
fees charged by and expenses relating to Central Mare for the years ended December 31, 2021, 2022 and 2023 are as follows:
|
Year Ended December 31, |
|||||||||||||
|
2021
|
|
2022 |
|
2023 |
Presented in: |
||||||||
|
Executive officers and other personnel expenses |
|
|
|
General and administrative expenses – Statement of comprehensive income |
|||||||||
|
Amortization of awarded shares* |
(
|
)
|
(
|
)
|
|
|
Management fees – related parties – Statement of comprehensive income |
||||||
|
Total |
|
|
|
||||||||||
|
*
|
|
(b) Central
Shipping Inc (
“
CSI
”
)
–
Letter Agreement and Management Agreements:
On January 1, 2019, the Company entered into a letter agreement with CSI (“CSI Letter Agreement”), a related party affiliated with the family of
Evangelos J. Pistiolis and between January 1, 2019 and September 8, 2021 the Company entered into management agreements, or Management Agreements, between CSI and the Company’s vessel-owning subsidiaries. The CSI Letter Agreement can only be
terminated subject to an
Pursuant to the CSI Letter Agreement, as well
as the Management Agreements concluded between CSI and the Company’s vessel-owning subsidiaries, the Company pays a management fee of $
CSI provides, at cost, all accounting,
reporting and administrative services. Finally, the CSI Letter Agreement provides for a performance incentive fee for the provision of management services to be determined at the discretion of the Company’s Board of Directors. The management
agreements have an initial term of
As of December 31, 2022 and 2023, the amounts
due to/(from) CSI were $
The fees charged by and expenses relating to CSI for the years ended December 31, 2021, 2022 and 2023 are as follows:
|
Year Ended December 31,
|
|||||||||||||
|
2021
|
2022
|
2023
|
Presented in: |
||||||||||
|
Management fees |
|
|
|
|
Capitalized in Vessels, net – Balance sheet |
||||||||
|
|
|
|
Management fees – related parties –Statement of comprehensive income |
||||||||||
|
Supervision services fees |
|
|
|
Capitalized in Vessels, net – Balance sheet |
|||||||||
|
Superintendent fees |
|
|
|
Vessel operating expenses –Statement of comprehensive income |
|||||||||
|
|
|
|
Capitalized in Vessels, net – Balance sheet |
||||||||||
|
Accounting and reporting cost |
|
|
|
Management fees – related parties –Statement of comprehensive income |
|||||||||
|
Commission for sale and purchase of vessels |
|
|
|
Management fees – related parties –Statement of comprehensive income |
|||||||||
|
|
|
|
Gain from vessel sales –Statement of comprehensive income |
||||||||||
|
|
|
|
Impairment on vessels – Statement of comprehensive income |
||||||||||
|
Newbuilding vessels monitoring fee |
|
|
|
Capitalized in Vessels, net – Balance sheet
|
|||||||||
|
Financing fees |
|
|
|
Net in Current and Non-current portions of long-term debt – Balance sheet |
|||||||||
|
Commission on charter hire agreements |
|
|
|
Voyage expenses - Statement of comprehensive income |
|||||||||
|
Total |
|
|
|
||||||||||
For the years ended December 31, 2021, 2022 and
2023 CSI charged the Company newbuilding supervision related pass-through costs amounting to $
(c)
Issuance and conversion of Series E Shares:
On March 29, 2019 the Company entered into a stock purchase agreement with Family Trading Inc (“Family Trading”), a related party
owned by the Lax Trust, an irrevocable trust established for the benefit of certain family members of Mr. Evangelos J. Pistiolis, pursuant to which the Company exchanged the outstanding principal, fees and interest of the Further Amended Family
Trading Credit Facility with
(d)
Vessel
Acquisitions from affiliated entities:
From January 6, 2021 to September 8, 2021 the Company entered into a series of transactions with a number of entities affiliated with Mr. Evangelos J. Pistiolis (see Note 1). As of December 31,
2021, there were
(e)
Charter
Party with
Central Tankers Chartering Inc (
“
CTC
”
):
On January 6, 2021 the Company acquired a shipowning company from an entity affiliated with Mr. Evangelos J. Pistiolis that owned M/T Eco Oceano CA which was
party to a time charter, with CTC, for a firm duration of
(f)
Personal Guarantees by Mr. Evangelos J. Pistiolis and Related Amendments to the Series D Preferred Shares:
As a prerequisite for the Navigare Lease (defined below, see Note 6), Mr. Evangelos J. Pistiolis personally guaranteed the
performance of the bareboat charters connected to the lease and in exchange, the Company agreed to indemnify him for any losses suffered as a result of the guarantee provided, and the Company amended the Certificate of Designations governing the
terms of the Series D Preferred Shares (see Note 9), to adjust the voting rights per share of Series D Preferred Shares such that during the term of the Navigare Lease, the combined voting power controlled by Mr. Evangelos J. Pistiolis and the Lax
Trust does not fall below a majority of the Company’s total voting power, irrespective of any new common or preferred stock issuances, and thereby complying with a relevant covenant of the bareboat charters entered in connection with the Navigare
Lease. This personal guarantee comes into effect in the case
(g) Issuance of Series F Shares:
On January 17, 2022, the Company entered into a stock purchase agreement with Africanus Inc., an affiliate of Evangelos J. Pistiolis for the sale of up to
(h) Short-term loan from Central Mare (“Central Mare Bridge Loan”):
On January 5, 2022 the Company entered into an unsecured credit facility for up to $
(i) Executive bonus:
On
December 10, 2023 the Company’s compensation committee comprising of independent directors suggested and the board of directors granted to Mr. Evangelos J. Pistiolis a bonus of $
|
6. |
Leases |
A. Lease arrangements, under which the Company acts as the lessee
Bareboat Chartered-in Vessels:
The Company has treated the Navigare lease as an operating lease. An
operating lease ROU asset amounting to $
The Company’s future minimum operating lease payments required to be made after December 31, 2023, relating to the bareboat chartered-in vessels M/T Eco Beverly Hills and M/T Eco Bel Air are as follows:
|
Year ending December 31, |
Bareboat charter lease payments
|
|||
|
2024 |
|
|||
|
2025
|
|
|||
|
Total |
|
|||
|
Less imputed interest |
(
|
) | ||
|
Total Lease Liability |
|
|||
|
Presented as follows: |
||||
|
Short-term lease liability |
|
|||
|
Long-term lease liability |
|
|||
The average remaining lease term on our bareboat chartered-in contracts
greater than 12 months is
B. Lease arrangements, under which the Company acts as the lessor
Charter agreements:
During the year ended December 31, 2023, the Company operated
Future minimum time-charter receipts of the Company’s vessels in operation as of December
31, 2023, based on commitments relating to non-cancellable time charter contracts as of December 31, 2023, are as follows :
|
Year ending December 31, |
Time Charter receipts |
|||
|
2024 |
|
|||
|
2025 |
|
|||
|
2026 |
|
|||
|
2027
|
|
|||
|
2028
and thereafter
|
|
|||
|
Total |
|
|||
In arriving at the minimum future charter revenues, an estimated
|
7. |
Debt: |
The amounts in the consolidated balance sheets are analyzed as follows (facility names defined below):
|
Bank / Vessel(s) |
December 31, |
|||||||
|
|
2022
|
2023
|
||||||
|
Total long-term debt: |
||||||||
|
ABN Facility (
|
|
|
||||||
|
Alpha Bank Facility
(
|
|
|
||||||
|
Cargill Facility (
|
|
|
||||||
|
CMBFL Facility (
|
|
|
||||||
|
2
nd
AVIC Facility (
|
|
|
||||||
|
3
rd
AVIC Facility (
|
|
|
||||||
|
Huarong Facility (
|
|
|
||||||
|
Total long-term debt |
|
|
||||||
|
Less: Deferred finance fees |
(
|
)
|
(
|
)
|
||||
|
Less: Debt discount
relating to Vessel fair value participation liability
|
(
|
)
|
(
|
)
|
||||
|
Total long-term debt net of deferred finance fees and debt discounts
|
|
|
||||||
|
|
||||||||
|
Presented: |
||||||||
|
Current portion of long-term debt |
|
|
||||||
|
Long-term debt |
|
|
||||||
ABN Facility
On March 18,
2021, the Company entered into a credit facility with ABN Amro for $
The facility
contained various covenants, including (i) an asset cover ratio of
The facility was secured as follows:
|
|
● |
First priority mortgage over M/T Eco West Coast; |
|
|
● |
Assignment of insurance and earnings of the mortgaged vessel; |
|
|
● |
Specific assignment of any time charters with duration of more than
|
|
|
● |
Corporate guarantee of the Company; |
|
|
● |
Pledge of the shares of the shipowning subsidiary; |
|
|
● |
Pledge over the earnings account of the vessel. |
The facility
bore interest at LIBOR plus a margin of
Alpha Bank Facility
On May 6,
2021, the Company entered into a credit facility with Alpha Bank for $
The facility
contained various covenants, including (i) an asset cover ratio of
The facility was secured as follows:
|
|
● |
First priority mortgage over M/T Eco Malibu; |
|
|
● |
Assignment of insurance and earnings of the mortgaged vessel; |
|
|
● |
Specific assignment of any time charters with duration of more than
|
|
|
● |
Corporate guarantee of the Company; |
|
|
● |
Pledge of the shares of the shipowning subsidiary; |
|
|
● |
Pledge over the earnings account of the vessel. |
The facility
bore interest at LIBOR plus a margin of
FINANCINGS COMMITTED UNDER SALE AND LEASEBACK AGREEMENTS
The majority
of the below sale and leaseback agreements (“SLB”s) contain, customary covenants and event of default clauses, including cross-default provisions and restrictive covenants and performance requirements including (i) a ratio of total net debt to the
aggregate market value of the Company’s fleet, current or future, of no more than
Additionally, all the SLBs contain restrictions on the relative shipowning company incurring further indebtedness or guarantees and paying dividends when in default or if such dividend payment would result in an event of default or termination event under the SLB agreements . The same dividend restrictions apply to the Company as well. All the SLBs except the Cargill Facility have change of control provisions whereby there may not be a change of control of the Company, save with the prior written consent of the financier.
All the below SLBs are secured mainly by the following:
|
|
● |
Ownership of the vessel financed; |
|
|
● |
Assignment of insurances and earnings of the vessel financed; |
|
|
● |
Specific assignment of any time charters of the vessel financed with duration of more than
|
|
|
● |
Corporate guarantee of Top Ships Inc.; |
|
|
● |
Pledge of the shares of the relative shipowning subsidiary; |
|
|
● |
Pledge over the earnings account of the vessel financed. |
On June 29,
2018 the Company entered into an SLB and a
The Company
had also entered into a fair value appreciation sharing agreement with Cargill whereby it would share with the latter
The SLB with Cargill is accounted for as a financing transaction, as control remains with the Company and the M/T Eco Marina Del Rey will continue to be recorded as an asset on the Company’s balance sheet. In addition, the Company has an obligation to repurchase the vessel.
CMBFL Facility
On November
23, 2021 the Company entered into an SLB with CMBFL, for its newbuilding vessels M/T Julius Caesar and M/T Legio X Equestris. Consummation of the SLB took place on January 17 and March 2 2022, respectively. Following the sale, the Company has
bareboat chartered back the vessels for a period of
As part of
this transaction, the Company has continuous options to buy back the vessels at purchase prices stipulated in the bareboat agreements depending on when the option will be exercised and at the end of the
The CMBFL
facility was accounted for as a financing transaction, as control will remain with the Company and the
3 rd AVIC Facility
Scheduled Principal Repayments: The Company’s annual principal payments required to be made after December 31, 2023 on its loan obligations, are as follows (including the financings under sale and leaseback agreements):
|
Years |
||||
|
December 31, 2024 |
|
|||
|
December 31, 2025 |
|
|||
|
December 31, 2026 |
|
|||
|
December 31, 2027 |
|
|||
|
December 31, 2028 and thereafter |
|
|||
|
Total |
|
|||
As of December 31, 2022 and 2023, the Company was in compliance with all debt covenants with respect to its loans and credit facilities. The fair value of debt outstanding on December 31, 2023, after excluding unamortized financing fees and debt discounts, approximates its carrying amount.
Financing Costs
:
The net additions in deferred financing costs amounted to $
|
8.
|
Commitments and Contingencies:
|
Various claims, suits, and complaints, including those involving government regulations and product liability, arise in the ordinary course of the shipping business. As part of the normal course of operations, the Company’s customers may disagree on amounts due to the Company under the provision of the contracts which are normally settled through negotiations with the customer. Disputed amounts are normally reflected in revenues at such time as the Company reaches agreement with the customer on the amounts due.
Other than the cases mentioned above, the Company is not a party to any material litigation where claims or counterclaims have been filed against the Company other than routine legal proceedings incidental to its business.
On December 10, 2020, the Company entered into a corporate guarantee agreement with Alpha Bank of Greece (which was amended on February 2, 2022) in respect of the obligations of its
Environmental Liabilities:
The Company accrues for the cost of environmental liabilities when management becomes aware that a liability is probable and is able to reasonably estimate the probable exposure. Currently, management is not aware of any such claims or contingent liabilities, which should be disclosed, or for which a provision should be established in the consolidated financial statements.
|
9. |
Common and Preferred Stock, Additional Paid-In Capital and Dividends: |
Reverse stock split: On September 29, 2023 the Company effected a reverse stock split of its common stock. There was no change in the number of authorized common shares of the Company, or the floor price of the Company’s Series E Shares, or the number of votes of the Company’s Series D, E and F Shares. All numbers of common share and earnings per share amounts, as well as warrant shares eligible for purchase under the Company’s warrants, exercise price of said warrants and conversion prices of the Company’s Series E Shares, in these consolidated financial statements have been retroactively adjusted to reflect this reverse stock split.
Series D preferred
shares:
On
May 8, 2017,
the Company issued
Equity distribution agreement:
On April 15, 2022, the Company, entered into an equity distribution agreement, or as they are commonly known, at-the-market offering (“ATM”), with Maxim Group LLC
(“Maxim”). Under the ATM the Company could sell up to $
|
10. |
Earnings/ (Loss) Per Common Share: |
All shares issued are included in the Company’s common stock and have equal rights to vote and participate in dividends and in undistributed earnings.
The components of the calculation of basic and diluted earnings/(loss) per share for the years ended December 2021, 2022 and 2023 are as follows:
|
Year Ended December 31, |
||||||||||||
|
2021
|
2022
|
2023
|
||||||||||
|
Net Income |
|
|
|
|||||||||
|
Less: Deemed dividend for beneficial conversion feature of Series E Shares |
(
|
) |
|
|
||||||||
|
Less: Deemed dividend equivalents on preferred shares related to redemption value |
(
|
) |
(
|
) |
|
|||||||
|
Less: Dividends of preferred shares |
(
|
) |
(
|
) |
(
|
) | ||||||
|
Less: Deemed dividend on warrant inducement
|
|
(
|
) |
|
||||||||
| Less: Deemed dividend on Series E Shares conversion |
|
|
(
|
) | ||||||||
|
Net Income / (Loss) attributable to common shareholders |
|
(
|
) |
(
|
) | |||||||
|
Earnings / (Loss) per share: |
||||||||||||
|
Weighted average common shares outstanding, basic and dilutive |
|
|
|
|||||||||
|
Earnings / (Loss) per share, basic and diluted |
|
(
|
) |
(
|
) | |||||||
For the years ended December 31, 2021, 2022 and 2023,
|
11. |
Voyage and Vessel Operating Expenses: |
The amounts in the consolidated statements of comprehensive income are as follows:
|
Voyage Expenses |
Year Ended December 31, |
|||||||||||
|
2021
|
2022
|
2023
|
||||||||||
|
Bunkers |
|
|
|
|||||||||
|
Commissions (including $
|
|
|
|
|||||||||
|
Total |
|
|
|
|||||||||
|
Vessel Operating Expenses |
Year Ended December 31, |
|||||||||||
|
2021
|
2022
|
2023
|
||||||||||
|
Crew wages and related costs |
|
|
|
|
||||||||
|
Insurance |
|
|
|
|||||||||
|
Repairs and maintenance (including $
|
|
|
|
|||||||||
|
Spares and consumable stores |
|
|
|
|||||||||
|
Registration and taxes (Note 13) |
|
|
|
|||||||||
|
Total |
|
|
|
|||||||||
|
12. |
Interest and Finance Costs: |
The amounts in the consolidated statements of comprehensive income are analyzed as follows:
|
Interest and Finance Costs |
Year Ended December 31, |
|||||||||||
|
2021
|
2022
|
2023
|
||||||||||
|
Interest on debt (including $
|
|
|
|
|||||||||
|
Bank charges
|
|
|
|
|||||||||
|
Amortization and write-off of financing fees |
|
|
|
|||||||||
| Amortization of debt discount relating to Vessel fair value participation liability (Note 7) |
|
|
|
|||||||||
|
Total |
|
|
|
|||||||||
|
Less interest capitalized |
(
|
) |
(
|
) |
|
|||||||
|
Total |
|
|
|
|||||||||
|
13. |
Income Taxes: |
Marshall Islands and Greece does not impose a tax on international shipping income. Under the laws of Marshall Islands and Greece the countries of the companies’ incorporation and vessels’ registration, the companies are subject to registration and tonnage taxes, which have been included in Vessel operating expenses in the consolidated statements of comprehensive income.
Under the United States Internal Revenue Code of 1986, as amended (the “Code”), the U.S. source gross transportation income of a ship-owning or chartering corporation, such as the Company, is subject to a 4% U.S. Federal income tax without allowance for deduction, unless that corporation qualifies for exemption from tax under Section 883 of the Code and the Treasury Regulations promulgated thereunder. U.S. source gross transportation income consists of 50% of the gross shipping income that is attributable to transportation that begins or ends, but that does not both begin and end, in the United States.
Under Section 883 of the Code and the regulations thereunder, the Company will be exempt from U.S. federal income tax on our U.S.-source shipping income if:
( 1 ) the Company is organized in a foreign country, or its country of organization, grants an “equivalent exemption” to corporations organized in the United States; and
( 2 ) either
A. more than 50% of the value of the Company’s stock is owned, directly or indirectly, by individuals who are “residents” of the Company’s country of organization or of another foreign country that grants an “equivalent exemption” to corporations organized in the United States (each such individual a “qualified shareholder” and such individuals collectively, “qualified shareholders”), which the Company refers to as the “50% Ownership Test,” or
B. the Company’s stock is “primarily and regularly traded on an established securities market” in the Company’s country of organization, in another country that grants an “equivalent exemption” to U.S. corporations, or in the United States, which the Company refers to as the “Publicly-Traded Test.”
The Marshall Islands, the jurisdiction where the Company and the Company’s ship-owning subsidiaries are incorporated, grants an “equivalent exemption” to U.S. corporations. Therefore, the Company will be exempt from U.S. federal income tax with respect to the Company’s U.S.-source shipping income if either the 50% Ownership Test or the Publicly-Traded Test is met.
Treasury Regulations provide, in pertinent part, that stock of a foreign corporation will be considered to be “primarily traded” on an established securities market if the number of shares of each class of stock that are traded during any taxable year on all established securities markets in that country exceeds the number of shares in each such class that are traded during that year on established securities markets in any other single country. The Company’s common shares, which is the Company’s sole class of issued and outstanding stock that is traded, is and the Company anticipates will continue to be “primarily traded” on the Nasdaq Capital Market.
The Treasury Regulations also require that the Company’s stock be “regularly traded” on an established securities market. Under the Treasury Regulations, the Company’s stock will be considered to be “regularly traded” if one or more classes of the Company’s stock representing more than 50% of the Company’s outstanding shares, by total combined voting power of all classes of stock entitled to vote and by total combined value of all classes of stock, are listed on one or more established securities markets, which the Company refers to as the “listing threshold.” The Company’s common stock, which is listed on the Nasdaq Capital Market and is the Company’s only class of publicly-traded stock, did not constitute more than 50% of the Company’s outstanding shares by value for the 2021 taxable year, and accordingly, the Company didn’t satisfy the 50% Ownership Test for the 2021 taxable year and consequently the Company didn’t qualify for exemption from tax under Section 883 for the 2021 taxable year.
The Company for the
2021
taxable year was subject to an effective
|
14. |
Financial Instruments: |
The principal financial assets of the Company consist of cash on hand and at banks, restricted cash, prepaid expenses and other receivables and long term deposits. The principal financial
liabilities of the Company consist of long-term loans, accounts payable due to suppliers, amounts due to related parties and accrued liabilities.
|
a) |
Interest rate risk: The Company as of December 31, 2023 is subject to market risks relating to changes in interest rates, since all of its debt except the Cargill Facility is subject to floating interest rates. |
|
|
b) |
Credit risk: Financial instruments, which potentially subject the Company to significant concentrations of credit risk, consist principally of cash. The Company places its temporary cash investments, consisting mostly of deposits, with high credit qualified financial institutions. The Company performs periodic evaluations of the relative credit standing of those financial institutions with which it places its temporary cash investments. |
|
|
c) |
Fair value:
|
The following methods and assumptions were used to estimate the fair value of each class of financial instrument:
Cash and cash equivalents and restricted cash are considered Level 1 items as they represent liquid assets with short term maturities. The Company considers its creditworthiness when determining the fair value of its liquid assets.
The Company follows the accounting guidance for Fair Value Measurements. This guidance enables the reader of the financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. The guidance requires assets and liabilities carried at fair value to be classified and disclosed in one of the following three categories:
Level 1: Quoted market prices in active markets for identical assets or liabilities;
Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data;
Level 3: Unobservable inputs that are not corroborated by market data.
|
15. |
Mezzanine Equity |
On March 29,
2019, the Company entered into a Stock Purchase Agreement with Family Trading for the sale of
Each holder
of Series E Shares, at any time, had the right, subject to certain conditions, to convert all or any portion of the Series E Shares then held by such holder into the Company’s common shares at the conversion rate then in effect. Each Series E Share
was convertible into the number of the Company’s common shares equal to the quotient of
The Series E
Shares were not subject to redemption in cash at the option of the holders thereof under any circumstance. Finally, the holders of outstanding Series E Shares were entitled to receive, semi-annual dividends payable in cash on the last day of June
and December of each year (each such date being referred to herein as a “Semi Annual Dividend Payment Date”), commencing on the first Semi Annual Dividend Payment Date, being June 30, 2019 in an amount per share (rounded to the nearest cent) equal
to
The Company determined that the Series E shares were more akin to equity than debt and that the above identified conversion feature, subject to adjustments, was clearly and closely related to the host instrument, and accordingly bifurcation and classification of the conversion feature as a derivative liability was not required. Given that the Series D and Series E preferred stock’s holder (Lax Trust) controlled a majority of the Company votes, the preferred equity was in essence redeemable at the option of the holder and hence was classified in Mezzanine equity as per ASC 480-10-S99 “Distinguishing liabilities from Equity – SEC Materials”.
On February
17, 2020 the Company issued
At each
issuance of Series E Shares, the Company recognized the beneficial conversion feature by allocating the intrinsic value of the conversion option, which is the number of shares of common stock available upon conversion multiplied by the difference
between the effective conversion price per share and the fair value of the Company’s common stock per share on the commitment date, to additional paid-in capital. As the Company was in an accumulated deficit position, the offsetting amount was
amortized as a deemed dividend recorded against additional paid-in-capital. During the year ended December 31, 2021, pursuant to issuances of Series E Shares, the Company recognized the beneficial conversion feature to additional paid-in capital,
resulting in a discount of $
During the years ended December 31, 2021, 2022 and 2023 the Company redeem any Series E Shares.
After March
29, 2020 as per the original Series E Shares Statement of Designations all redemptions of Series E Shares would incur a redemption premium equal to
During the
years ended December 31, 2021, 2022 and 2023 the Company declared $
On December
6, 2023 the Company received a conversion notice for the conversion of all the outstanding Series E Shares (
The
Company, based on ASC 470-20-40-5, determined that the Series E Shares conversion feature is in essence a redemption, since such conversion was settled by a delivery of a variable number of shares of common stock with a fixed monetary amount and by
applying ASC 260-10-S99-2 has recognized the difference between the carrying amount of the Series E Shares at the date of conversion and the fair value of the common stock delivered on the same date as a deemed dividend.
SERIES F PREFERRED SHARES
On January 17, 2022, the Company entered
into a stock purchase agreement with Africanus Inc., an affiliate of Evangelos J. Pistiolis for the sale of up to
|
16. |
Investments in Unconsolidated Joint Ventures |
New 2020 Joint Venture
On April 24,
2020 the Company acquired from a company affiliated with Mr. Evangelos J. Pistiolis, or the MR Seller, a
Out of the
purchase price of $
On March 12,
2020, California 19 Inc. together with California 20 Inc. entered into a loan agreement with Alpha Bank for a senior debt facility of $
Each of the
two product tankers are on time charters that commenced in March 2020 with Clearlake Shipping Pte Ltd, a subsidiary of Gunvor Group Ltd for a firm term of
The Company’s exposure is limited to its
share of the net assets of California 19 Inc. and California 20 Inc., proportionate to its
California 19 Inc. and California 20 Inc. made the following disbursements to the Company in 2021, 2022 and 2023:
|
December 31, 2021 |
December 31, 2022 |
December 31, 2023
|
||||||||||||||||||||||
|
California 19 Inc. |
California 20 Inc. |
California 19 Inc. |
California 20 Inc. |
California 19
Inc.
|
California
20 Inc.
|
|||||||||||||||||||
|
Total disbursements
|
|
|
|
|
|
|
||||||||||||||||||
Recognition of Equity gain/(loss) in unconsolidated joint ventures of the 2020 Joint Venture for the years ended December 31, 2021, 2022 and 2023 are summarized below:
|
December 31, 2021 |
December 31, 2022 |
December 31, 2023 | ||||||||||||||||||||||
|
California 19 Inc. |
California 20 Inc. |
California 19 Inc. |
California 20 Inc. |
California 19
Inc.
|
California 20
Inc.
|
|||||||||||||||||||
|
Net profit attributable to the Company |
|
|
|
|
|
|
||||||||||||||||||
|
Amortization of Basis Differences |
(
|
) |
(
|
) |
(
|
) |
(
|
) |
(
|
) |
(
|
) | ||||||||||||
|
Equity gains in unconsolidated joint ventures (attributed to the 2020 Joint Venture) |
|
|
|
|
(
|
) |
(
|
) | ||||||||||||||||
|
17. |
Revenues |
Revenues are comprised of the following:
|
2021 |
2022 |
2023 |
||||||||||
|
Time charter revenues |
|
|
|
|
||||||||
|
Time charter revenues from related party (Note 5)
|
|
|
|
|||||||||
|
Total |
|
|
|
|||||||||
The Company
typically enters into time charters for periods ranging between
to
|
18. |
Subsequent Events |