What changed in this filing

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Item 1. Business

2025-03-18 compared with 2024-03-14 · 199 added, 141 removed, 959 unchanged (26% of the section changed)

Pangaea Logistics Solutions Ltd.

and its subsidiaries (collectively, “Pangaea” or the “Company”) provides seaborne drybulk logistics and transportation services as well as terminal and stevedoring services.

and its subsidiaries (collectively, “Pangaea” or the “Company”) provide seaborne drybulk logistics and transportation services as well as terminal and stevedoring services.

Pangaea utilizes its logistics expertise to service a broad base of industrial customers who require the transportation of a wide variety of drybulk cargoes, including grains, coal, iron ore, pig iron, hot briquetted iron, bauxite, alumina, cement clinker, dolomite and limestone.

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At any time, this fleet may be comprised of a total of 45-60 vessels that are owned or chartered-in on a short-term basis.

During 2023, the Company operated 26 vessels which were wholly-owned or partially-owned through joint ventures.

Following the Company’s acquisition of 15 handy size dry bulk carries on December 30, 2024 pursuant to its acquisition of Renaissance Holdings LLC, a wholly owned subsidiary of Strategic Shipping Inc.

(“SSI”), the Company owned 41 vessels as of December 31, 2024 which were wholly-owned or partially-owned through joint ventures.

The Company uses this fleet to transport approximately 22 million tons of cargo annually to nearly 225 ports around the world, averaging approximately 48 vessels in service daily in 2024 and 46 during 2023.

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Active risk management is an important part of our business model.

The Company believes its active risk management allows it to reduce the sensitivity of its revenues to market fluctuations and helps it to secure its long-term profitability and lower relative volatility of earnings.

We manage market risk by chartering in vessels for periods of less than nine months on average and

through a portfolio approach based upon owned vessels, chartered-in vessels, COAs, voyage charters, and time charters.

The Company believes its active risk management allows it to reduce the sensitivity of its revenues to market fluctuations and helps it to secure its long-term profitability and lower relative

volatility of earnings.

We manage market risk by chartering in vessels for periods of less than nine months on average and through a portfolio approach based upon owned vessels, chartered-in vessels, COAs, voyage charters, and time charters.

The Company tries to identify routes and ports for efficient bunkering to minimize its fuel expense.

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The Company employs the technical management services of Seamar Management S.A.

which is 51% owned by the Company, and Bernard Schulte Shipmanagment, a third party, for its ice class 1A fleet.

which is 51% owned by the Company, and Bernard Schulte Ship Managment, a third party, for its ice class 1A fleet and M.T.M Ship Management, a related party, for its Handysize fleet.

Business Strategy

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COA’s provide a consistent cargo base and revenue for our transportation services, around which we attempt to structure other logistics offerings.

• Expand capacity and flexibility by renewing its owned fleet and invest in ice class niche.

• Expand capacity and flexibility by renewing its owned fleet..

The Company is continually looking to acquire additional high-quality vessels suited for its business strategy, the needs of its customers and growth opportunities the Company identifies.

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The Company currently controls (owns or has an ownership interest in) a fleet of 41 bulk carriers as of March 17, 2025.

The current fleet includes six Ice-Class 1A Panamax, four Post Panamax Ice Class 1A, three Panamax, two Ultramax Ice Class 1C, two Ultramax and seven Supramax drybulk vessels.

The current fleet includes six Ice-Class 1A Panamax, four Post Panamax Ice Class 1A, three Panamax, two Ultramax Ice Class 1C, two Ultramax, nine Supramax drybulk vessels and fifteen Handysize vessels.

• Increase backhaul focus, expand and defend its presence in the niche ice trades and increase fleet efficiency.

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• Expertise in certain niche markets and routes.

The Company has developed expertise and a major presence in selected niche markets and less commoditized routes, especially the Baltic Sea in winter, the Northern Sea Route between Europe and Asia in summer, and the trade route between Jamaica and the United States, as well as selected ports, particularly in Newfoundland and Baffin Island.

The Company has developed expertise and a major presence in selected niche markets and less commoditized routes, especially the Baltic Sea in winter, ice laden northern atlantic ports in the summer, and the trade route between Jamaica and the United States, as well as selected ports, particularly in Newfoundland and Baffin Island.

The Company believes that there is less competition to carry “minor,” as compared to traditional “major,” bulk cargoes, and, similarly, that there is less competition on less commoditized routes.

The Company believes that its experience in carrying a wide range of cargoes and transiting less common routes and ports increases its likelihood of securing higher rates and margins than those available for more commoditized cargoes and routes.

The Company believes it operates assets well suited to certain of these routes, including its Ice-

Class 1A Panamax, Post Panamax Ice Class 1A and Ice-Class 1C Ultramax vessels.

The Company believes it operates assets well suited to certain of these routes, including its Ice-Class 1A Panamax, Post Panamax Ice Class 1A and Ice-Class 1C Ultramax vessels.

The ice-class fleet has historically produced margins that are superior to the average market rate.

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Other members of its management team, Mads Boye Petersen and Gianni Del Signore, also have extensive experience in the shipping industry.

The Company believes its management team and key employees are well respected in the drybulk sector of the shipping industry

and, over the years, has developed strong commercial relationships with industrial customers and lenders.

Company believes its management team and key employees are well respected in the drybulk sector of the shipping industry and, over the years, has developed strong commercial relationships with industrial customers and lenders.

The Company believes that the experience, reputation and background of its management team will continue to be key factors in its success.

The Company provides logistics services and commercially manages its fleet primarily from offices in Newport, Rhode Island, Copenhagen, Denmark and Singapore.

The Company provides logistics services and commercially manages its fleet primarily from offices in Newport, Rhode Island, Copenhagen, Denmark, South Port, Connecticut, and Singapore.

Logistics services and commercial management include identifying cargo for transportation, voyage planning, managing relationships, identifying vessels to charter in, and operating such vessels.

The Company’s Ice-Class 1A Panamax vessels are technically managed by a third-party manager.

The technical management of the remainder of the Company’s owned fleet is performed in-house by our 51% owned joint venture, Seamar Management, S.A..

The technical management of the Company’s non ice class Panamax vessels as well as our Supramax and Ultramax vessels are performed in-house by our 51% owned joint venture, Seamar Management, S.A..

The Company’s technical management personnel have experience in the complexities of oceangoing vessel operations, including the supervision of maintenance, repairs, improvements, drydocking and crewing.

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As a result, the Company spends significant time and resources to identify and retain customers and source potential cargoes in its areas of operation.

To further expand its customer base and potential cargoes, the Company has developed expertise in servicing ports and routes subject to severe ice conditions, including the Baltic Sea and the Northern Sea Route.

To further expand its customer base and potential cargoes, the Company has developed expertise in servicing ports and routes subject to severe ice conditions.

As of March 17, 2025, the Company operates its fleet of 41 owned or partially owned vessels, which are described in the table below:

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m/v Bulk Friendship Supramax 58,738 2011 Nantong Cosco Kawasaki HI

m/v Bulk Brenton Supramax 57,676 2016 Tsuneishi (Cebu)

m/v Bulk Friendship Supramax 57,676 2016 Tsuneishi (Cebu)

m/v Bulk Sachuest Supramax 55,618 2010 Hyundai Vinashin

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m/v Nordic Siku Post Panamax (Ice Class 1A) 95,000 2021 Guangzhou Shipyard International Company Limited

m/v Strategic fortitude Handysize 37,829 2016 Imabari Shipyard, Japan

m/v Strategic resolve Handysize 38,872 2015 CSIC:

Shanhaiguan Shipyard, China

m/v Strategic explorer Handysize 39,879 2015 CSIC:

Tianjin Xingang SB, China

m/v Strategic entity Handysize 39,880 2015 CSIC:

Tianjin Xingang SB, China

m/v Strategic synergy Handysize 39,865 2014 CSIC:

Tianjin Xingang SB, China

m/v Strategic alliance Handysize 39,848 2014 CSIC:

Tianjin Xingang SB, China

m/v Strategic unity Handysize 39,820 2014 CSIC:

Tianjin Xingang SB, China

m/v Strategic harmony Handysize 39,879 2014 CSIC:

Tianjin Xingang SB, China

m/v Strategic equity Handysize 39,839 2014 CSIC:

Tianjin Xingang SB, China

m/v Strategic venture Handysize 39,784 2014 CSIC:

Tianjin Xingang SB, China

m/v Strategic savannah Handysize 35,542 2013 Taizhou Maple Leaf, China

m/v Strategic spirit Handysize 37,190 2012 Hyundai Mipo, Korea

m/v Strategic vision Handysize 37,186 2012 Hyundai Mipo, Korea

m/v Strategic tenacity Handysize 36,851 2012 Hyundai Vinashin, Vietnam

m/v Strategic endeavor Handysize 33,013 2010 Zhejiang Zhenghe Shipbuilding, China

(1) Formerly known as m/v Bulk PODS

The Company owns its vessels through separate wholly-owned subsidiaries and through joint venture entities with other owners, which the Company consolidates as variable interest entities in its consolidated financial statements.

On September 28, 2020, the Company acquired an additional one-third equity interest in its partially-owned consolidated subsidiary Nordic Bulk Holding Company Ltd.

(“NBHC”) from one of NBHC’s shareholders.

The Company owns two-thirds of NBHC after the acquisition.

NBHC is a corporation that was duly organized under the laws of Bermuda in October 2012.

The m/v Nordic Orion (“Orion”), the m/v Nordic Odyssey (“Odyssey”), the m/v Nordic Oshima (“Oshima”), the m/v Nordic Olympic (“Olympic”), the m/v Nordic Odin (“Odin”) and the m/v Nordic Oasis (“Oasis”) are owned by wholly-owned subsidiaries of NBHC.

All of these vessels are time chartered to Pangaea Denmark, a wholly-owned subsidiary of the Company, at fixed rates and also have a profit share arrangement.

Pangaea Denmark commercially operates these vessels in spot and COA trades.

On September 23, 2024, the Company entered into a definitive Agreement and Plan of Merger (the “Merger Agreement”) with Strategic Shipping Inc.

(“SSI”), Renaissance Holdings LLC, a wholly-owned subsidiary of SSI (“Renaissance”), and Renaissance Merger Sub LLC, a wholly-owned subsidiary of the Company (“Merger Sub”), pursuant to which Renaissance merged with and into Merger Sub, after which the separate existence of Merger Sub ceased and Renaissance became a wholly-owned subsidiary of the Company (the “Merger”).

As a result of the Merger, on December 30, 2024, the Company acquired fifteen handy-size dry bulk vessels from SSI.

Prior to the consummation of the Merger, the Company and SSI entered into an Investor and Registration Rights Agreement (the “Investor Agreement”) pursuant to which the Company registered the

Common Shares issued to SSI in the Merger, together with other common shares held by SSI that were acquired after the Merger in open market transactions, for resale pursuant to a registration statement under the Securities Act which was declared effective on January 30, 2025.

The Investor Agreement also provides SSI with certain pre-emptive rights and the right to designate up to two members to the Company’s board of directors.

In connection with the Transaction and in accordance with the Merger Agreement, the Company issued to SSI an aggregate of 18,059,342 shares of its common stock.

For more information, please see our Merger Agreement filed as exhibit 10.16 hereto, and our Investor Agreement attached hereto as exhibit 10.17 to this annual report.

In September 2019, the Company entered into an LLC agreement for the formation of NBP, that, at inception is owned 75% by the Company and 25% by an independent third party.

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The independent third party made additional contribution which increased their ownership interest in NBP to 50% at December 31, 2023.

No change of control transactions occurred according to the NBP LLC agreement.

On October 3, 2024, Pangaea Logistics Solutions Ltd.

entered into a definitive agreement to purchase the remaining 50% equity of Nordic Bulk Partners LLC from HS Nordic LLC for $ 19.18 million in cash.

The transaction was finalized on November 6, 2024, giving Pangaea full ownership of Nordic Bulk Partners.

This acquisition grants Pangaea 100% control over Nordic Bulk Partners.

The Company operates a variety of chartered-in drybulk carriers in addition to its owned vessels.

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In 2023, the Company owned interests in 26 vessels and chartered in another 185 for one or more voyages.

The Company g enerally charters in third-party vessels for periods of less than nine months and, in most cases, less than six months.

The Company generally charters in third-party vessels for periods of less than nine months and, in most cases, less than six months.

Chartered-in contracts are negotiated through third-party brokers, who are paid commission on a percentage of charter cost.

The Company believes that shorter-term charters afford it flexibility to match its variable costs to its customers’ service requirements and to respond quickly to market

The Company believes that shorter-term charters afford it flexibility to match its variable costs to its customers’ service requirements and to respond quickly to market volatility.

The Company also believes that this combination of owned and chartered-in vessels helps it to more efficiently match its customer demand than the Company could with only owned vessels or an entirely chartered-in fleet.

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As of March 17, 2025, the Company’s significant subsidiaries are as follows:

Company Name Country of Organization Proportion of Ownership Interest

Company Name Country of Organization Proportion of Ownership Interest Footnote

Americas Bulk Transport (BVI) Limited British Virgin Islands 100% (A)

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Bulk Nordic Odyssey Corp.

(MI) Marshall Islands 67% (K)

(MI) ("Bulk Odyssey") Marshall Islands 67% (J)

Bulk Nordic Orion Corp.

(MI) Marshall Islands 67% (K)

(MI) ("Bulk Orion") Marshall Islands 67% (J)

Nordic Bulk Holding Company Ltd.

(“NBHC”) Bermuda 67% (L)

Company Name Country of Organization Proportion of Ownership Interest Footnote

Bulk Courageous Corp.

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(“Five”) Bermuda 100% (G)

Bulk Nordic Six Ltd.

(“Six”) Bermuda 100% (G)

Bulk Nordic Seven LLC (“Seven”) Marshall Islands 100% (G)

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Nordic Bulk Ventures Holding Company Ltd.

(“BVH”) Bermuda 100% (A)

(“BVH”) Bermuda 100% (K)

Bulk Freedom Corp.

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("Phoenix Bulk 25") Marshall Islands 100% (G)

Bulk Endurance (MI) Corp.

(“Bulk Endurance") Marshall Islands 100% (G)

Bulk Brenton (MI) Corp.

(“Bulk Brenton") Marshall Islands 100% (G)

Bulk Patience (MI) Corp.

(“Bulk Patience") Marshall Islands 100% (G)

Bulk Sachuest Corp.

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Pangaea Port Everglades LLC Delaware 100% (R)

Pangaea Florida LLC Delaware 100% (R)

Pangaea Texas LLC Texas 100% (R)

Renaissance Holdings LLC Marshall Islands 100% (A)

RHI Alliance Pte.

(“SBC Alliance”) Singapore 100% (G)

RHI Synergy Pte.

(“SBC Synergy”) Singapore 100% (G)

RHI Unity Pte.

(“SBC Unity”) Singapore 100% (G)

RHI Fortitude Pte.

(“SBC Fortitude”) Singapore 100% (G)

RHI Savannah Pte.

(“SBC Savannah”) Singapore 100% (G)

RHI Tenacity Pte.

(“SBC Tenacity”) Singapore 100% (G)

SBC Endeavor LLC ("SBC Endeavor") Marshall Islands 100% (G)

SBC Endeavor Pte.

("SBC Endeavor") Singapore 100% (G)

SBC Resolve LLC ("SBC Resolve") Marshall Islands 100% (G)

SBC Resolve Pte.

("SBC Resolve") Singapore 100% (G)

SBC Vision LLC ("SBC Vision") Marshall Islands 100% (G)

SBC Vision Pte.

("SBC Vision") Singapore 100% (G)

SBC Explorer LLC ("SBC Explorer") Marshall Islands 100% (G)

SBC Explorer Pte.

("SBC Explorer") Singapore 100% (G)

SBC Entity LLC ("SBC Entity") Marshall Islands 100% (G)

SBC Entity Pte.

("SBC Entity") Singapore 100% (G)

SBC Spirit LLC ("SBC Spirit") Marshall Islands 100% (G)

Company Name Country of Organization Proportion of Ownership Interest Footnote

SBC Spirit Pte.

("SBC Spirit") Singapore 100% (G)

SBC Venture Pte.

("SBC Venture") Singapore 100% (G)

SBC Equity Pte.

("SBC Equity") Singapore 100% (G)

SBC Harmony Pte.

("SBC Harmony") Singapore 100% (G)

(A) The primary purpose of this corporation is to manage and operate ocean going vessels.

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These companies are wholly-owned by NBHC, which is two-third owned by the Company.

(K) The primary purpose of this entity is to transfer ownership of the m/v Nordic Odyssey and m/v Nordic Orion.

(K) The primary purpose of this entity is to hold the Company's interest in vessel owning companies.

(L) The primary purpose of this entity is to own or lease bulk carriers through wholly-owned subsidiaries.

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The Company competes for COAs on the basis of service, price, route history, size, age and condition of the vessel and for charters on the basis of service, price, vessel availability, size, age and condition of the vessel, as well as on its reputation as an owner and operator.

The Company principally competes with owners and operators of Panamax, Supramax, Ultramax and Handymax bulk carriers.

The Company principally competes with owners and operators of Panamax, Supramax, Ultramax, Handymax and Handysize bulk carriers.

The Company attempts to differentiate itself from other owners and operators by extending its services to support more of its customers' supply chains and concentrates on established niche markets.

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The dry bulk carrier market is typically stronger in the fall months in anticipation of increased consumption of coal and other raw materials in the northern hemisphere during the winter months.

Seasonal fluctuation are also observed in harvest times in the Northern and Southern Atlantic trades.

Seasonal fluctuation are also observed in harvest times in the Northern and Southern

Atlantic trades.

In addition, unpredictable weather patterns in these months tend to disrupt vessel scheduling and supplies of certain commodities.

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The Company has been able to obtain all permits and certificates currently required to permit its vessels to operate.

Additional laws and

regulations, environmental or otherwise, may be adopted which could limit its ability to do business or increase the cost of doing business.

Additional laws and regulations, environmental or otherwise, may be adopted which could limit its ability to do business or increase the cost of doing business.

Environmental and Other Regulations

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In September of 1997, the IMO adopted Annex VI to MARPOL to address air pollution from vessels.

Effective May 2005, Annex VI sets limits on nitrogen oxide emissions from ships whose diesel engines were constructed (or underwent major conversions) on or after January 1, 2000.

It also prohibits “deliberate emissions” of “ozone depleting substances,” defined to include certain halons and chlorofluorocarbons.

Effective May 2005, Annex VI sets limits on sulfur oxide and nitrogen oxide emissions from all commercial vessel exhausts and prohibits “deliberate emissions” of “ozone depleting substances,” defined to include certain halons and chlorofluorocarbons.

Deliberate emissions are not limited to times when the ship is at sea;

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Annex VI also includes a global cap on the sulfur content of fuel oil (see below).

The IMO’s Marine Environment Protection Committee, or MEPC, adopted amendments to Annex VI on October 10, 2008, which amendments were entered into force on July 1, 2010.

The IMO’s Marine Environment Protection Committee, or MEPC, adopted amendments to Annex VI regarding emissions of sulfur oxide, nitrogen oxide, particulate matter and ozone depleting substances, which entered into force on July 1, 2010.

The Amended Annex VI seeks to further reduce air pollution by, among other things, implementing a progressive reduction of the amount of sulfur contained in any fuel oil used onboard ships.

On October 27, 2016, at its 70th session, the MEPC agreed to implement a global 0.5% m/m sulfur oxide emissions limit (reduced from 3.50%) starting from January 1, 2020.

On October 27, 2016, MEPC 70 agreed to implement a global 0.5% m/m sulfur oxide emissions limit (reduced from 3.50%) starting from January 1, 2020.

This limitation can be met by using low-sulfur compliant fuel oil, alternative fuels, or certain exhaust gas cleaning systems.

Ships are now required to obtain bunker delivery notes and International Air Pollution Prevention (“IAPP”) Certificates from their flag states that specify sulfur content.

Additionally, at MEPC 73, amendments to Annex VI to prohibit the carriage of bunkers above 0.5% sulfur on ships were adopted and will take effect March 1, 2020, with the exception of vessels fitted with exhaust gas cleaning equipment ("scrubbers") which can carry fuel of higher sulfur content.

Additionally, at MEPC 73, amendments to Annex VI to prohibit the carriage of bunkers above 0.5% sulfur on ships were adopted and took effect March 1, 2020, with the exception of vessels fitted with exhaust gas cleaning equipment ("scrubbers") which can carry fuel of higher sulfur content.

These regulations subject ocean-going vessels to stringent emissions controls, and may cause us to incur substantial costs, including those related to the purchase, installation and operation of scrubbers and the purchase of compliant fuel oil.

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As of January 1, 2015, ships operating within an ECA were not permitted to use fuel with sulfur content in excess of 0.1% m/m.

Amended Annex VI establishes procedures for designating new ECAs.

Currently, the IMO has designated four ECAs, including specified portions of the Baltic Sea area, North Sea area, North American area and United States Caribbean area.

The amended Annex VI establishes procedures for designating new ECAs.

Currently, the IMO has designated five ECAs, including specified portions of the Baltic Sea area, Mediterranean Sea area, North Sea area, North American area and United States Caribbean area.

Mediterranean Sea became an ECA on May 1, 2024, and compliance obligations will begin May 1, 2025.

Ocean-going vessels in these areas will be subject to stringent emission controls and may cause us to incur additional costs.

Certain ports in which our vessels call, including China and Singapore, are currently or may become subject to local regulations that impose stricter emission controls.

In December 2021, the member states of the Convention for the Protection of the Mediterranean Sea Against Pollution (the “Barcelona Convention”) agreed to support the designation of a new ECA in the Mediterranean.

On December 15, 2022, MEPC 79 adopted the designation of a new ECA in the Mediterranean, with an effective date of May 1, 2025.

In July 2023, MEPC 80 announced three new ECA proposals, including the Canadian Arctic waters and the North-East

Atlantic Ocean.

In July 2023, MEPC 80 announced three new ECA proposals, including the Canadian Arctic waters and the North-East Atlantic Ocean, which were adopted in draft amendments to Annex IV that will enter into force in March 2026.

If other ECAs are approved by the IMO, or other new or more stringent requirements relating to emissions from marine diesel engines or port operations by vessels are adopted by the U.S.

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Risk Factors for further details of our plan for compliance and potential costs.

Amended Annex VI also establishes new tiers of stringent nitrogen oxide emissions standards for marine diesel engines, depending on their date of installation.

At the MEPC meeting held from March to April 2014, amendments to Annex VI were adopted which address the date on which Tier III Nitrogen Oxide (NOx) standards in ECAs will go into effect.

Under the amendments, Tier III NOx standards apply to ships that operate in the North American and U.S.

Caribbean Sea ECAs designed for the control of NOx produced by vessels with a marine diesel engine installed and constructed on or after January 1, 2016.

Tier III requirements could apply to areas that will be designated for Tier III NOx in the future.

The amended Annex VI also established new tiers of stringent nitrogen oxide emissions standards for marine diesel engines, depending on their date of installation.

Tier III Nitrogen Oxide (NOx) standards were designed for the control of NOx produced by vessels and apply to ships that operate in the North American and U.S.

Caribbean Sea ECAs with marine diesel engine installed and constructed on or after January 1, 2016.

Tier III requirements could apply to additional areas designated for Tier III NOx in the future.

At MEPC 70 and MEPC 71, the MEPC approved the North Sea and Baltic Sea as ECAs for nitrogen oxide for ships built on or after January 1, 2021.

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As a result of these designations or similar future designations, we may be required to incur additional operating or other costs.

As determined at the MEPC 70, the new Regulation 22A of MARPOL Annex VI became effective as of March 1, 2018 and requires ships above 5,000 gross tonnage to collect and report annual data on fuel oil consumption to an IMO database, with the first year of data collection having commenced on January 1, 2019.

The IMO intends to use such data as the first step in its roadmap (through 2023) for developing its strategy to reduce greenhouse gas emissions from ships, as discussed further below.

At MEPC 70, Regulation 22A of MARPOL Annex VI became effective as of March 1, 2018 and requires ships above 5,000 gross tonnage to collect and report annual data on fuel oil consumption to an IMO database, with the first year of data collection having commenced on January 1, 2019.

The IMO used such data as part of its initial roadmap (through 2023) for developing its strategy to reduce greenhouse gas emissions from ships, as discussed further below.

As of January 1, 2013, MARPOL made mandatory certain measures relating to energy efficiency for ships.

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MEPC 75 adopted amendments to MARPOL Annex VI which brings forward the effective date of the EEDI’s “phase 3” requirements from January 1, 2025 to April 1, 2022 for several ship types, including gas carriers, general cargo ships, and LNG carriers.

Additionally, MEPC 75 introduced draft amendments to Annex VI which impose new regulations to reduce greenhouse gas emissions from ships.

Additionally, in 2022, MEPC amended Annex VI to impose new regulations to reduce greenhouse gas emissions from ships.

These amendments introduce requirements to assess and measure the energy efficiency of all ships and set the required attainment values, with the goal of reducing the carbon intensity of international shipping.

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With respect to the CII, the draft amendments would require ships of 5,000 gross tonnage to document and verify their actual annual operational CII achieved against a determined required annual operational CII.

Additionally, MEPC 75 proposed draft amendments requiring that, on or before January 1, 2023, all ships above 400 gross tonnage must have an approved SEEMP on board.

For ships above 5,000 gross tonnage, the SEEMP would need to include certain mandatory content.

MEPC 75 also approved draft amendments to MARPOL Annex I to prohibit the use and carriage for use as fuel of heavy fuel oil (“HFO”) by ships in Arctic waters on and after July 1, 2024.

The draft amendments introduced at MEPC 75 were adopted at the MEPC 76 session in June 2021 and entered into force in November 2022, with the requirements for EEXI and CII certification coming into effect from January 1, 2023.

MEPC 77 adopted a non-binding resolution which urges Member States and ship operators to voluntarily use distillate or other cleaner alternative fuels or methods of propulsion that are safe for ships and could contribute to the reduction of Black Carbon emissions from ships when operating in or near the Arctic.

All ships above 400 gross tonnage must also have an approved SEEMP on board.

For ships above 5,000 gross tonnage, the SEEMP needs to include certain mandatory content.

That same year, MEPC 75 amended MARPOL Annex I to prohibit the use and carriage for use as fuel of heavy fuel oil (“HFO”) by ships in Arctic waters on and after July 1, 2024.

In 2021, MEPC 77 adopted a non-binding resolution which urges Member States and ship operators to voluntarily use distillate or other cleaner alternative fuels or methods of propulsion that are safe for ships and could contribute to the reduction of Black Carbon emissions from ships when operating in or near the Arctic.

MEPC 79 adopted amendments to MARPOL Annex VI, Appendix IX to include the attained and required CII values, the CII rating and attained EEXI for existing ships in the required information to be submitted to the IMO Ship Fuel Oil Consumption Database.

MEPC 79 revised the EEDI calculation guidelines to include a CO2 conversion factor for ethane, a reference to the updated ITCC guidelines, and a clarification that in case of a ship with multiple load line certificates, the maximum certified summer draft should be used when determining the deadweight.

The amendments will enter into force on May 1, 2024.

MEPC 79 also revised the EEDI calculation guidelines to include a CO2 conversion factor for ethane, a reference to

the updated ITCC guidelines, and a clarification that in case of a ship with multiple load line certificates, the maximum certified summer draft should be used when determining the deadweight.

The amendments entered into force on May 1, 2024.

In July 2023, MEPC 80 approved the plan for reviewing CII regulations and guidelines, which must be completed at the latest by January 1, 2026.

There will be no immediate changes to the CII framework, including correction factors and voyage adjustments, before the review is completed.

This review commenced at MEPC 82 in Fall 2024, and there will be no immediate changes to the CII framework, including correction factors and voyage adjustments, before the review is completed.

We may incur costs to comply with these revised standards.

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Under Chapter IX of the SOLAS Convention, or the International Safety Management Code for the Safe Operation of Ships and for Pollution Prevention (the “ISM Code”), our operations are also subject to environmental standards and requirements.

The ISM Code requires the party with operational control of a vessel to develop an extensive safety management system that includes, among other things, the adoption of a safety and environmental protection policy setting forth instructions and procedures for operating its vessels safely and describing procedures for responding to emergencies.

We rely upon the safety management system that we and our technical management team have developed for compliance with the ISM Code.

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Amendments to the SOLAS Convention Chapter VII apply to vessels transporting dangerous goods and require those vessels be in compliance with the International Maritime Dangerous Goods Code (“IMDG Code”).

Effective January 1, 2018, the IMDG Code includes (1) updates to the provisions for radioactive material, reflecting the latest provisions from the International Atomic Energy Agency, (2) new marking, packing and classification requirements for dangerous goods, and (3) new mandatory training requirements.

Amendments that took effect on January 1, 2020, also reflect the latest material from the UN Recommendations on the Transport of Dangerous Goods, including (1) new provisions regarding IMO type 9 tank, (2) new abbreviations for segregation groups, and (3) special provisions for carriage of lithium batteries and of vehicles powered by flammable liquid or gas.

Effective January 1, 2018, the IMDG Code includes (1) the provisions for radioactive material, reflecting the latest provisions from the International Atomic Energy Agency, (2) marking, packing and classification requirements for dangerous goods, and (3) mandatory training requirements.

Amendments that took effect on January 1, 2020, also reflect the latest material from the UN Recommendations on the Transport of Dangerous Goods, including (1) provisions regarding IMO type 9 tank, (2) abbreviations for segregation groups, and (3) special provisions for carriage of lithium batteries and of vehicles powered by flammable liquid or gas.

Additional amendments, which came into force on June 1, 2022, include (1) addition of a definition of dosage rate, (2) additions to the list of high consequence dangerous goods, (3) new provisions for medical/clinical waste, (4) addition of various ISO standards for gas cylinders, (5) a new handling code, and (6) changes to stowage and segregation provisions.

The newest edition of the IMDG Code took effect on January 1, 2024, although the changes are largely incremental.

The IMO has also adopted the International Convention on Standards of Training, Certification and Watchkeeping for Seafarers (“STCW”).

As of February 2017, all seafarers are required to meet the STCW standards and be in possession of a valid STCW certificate.

As of February 2017, all seafarers are required to meet the STCW standards and be in possession of a valid STCW

Flag states that have ratified SOLAS and STCW generally employ the classification societies, which have incorporated SOLAS and STCW requirements into their class rules, to undertake surveys to confirm compliance.

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The Polar Code, which entered into force on January 1, 2017, covers design, construction, equipment, operational, training, search and rescue as well as environmental protection matters relevant to ships operating in the waters surrounding the two poles.

It also includes mandatory measures regarding safety and pollution

prevention as well as recommendatory provisions.

It also includes mandatory measures regarding safety and pollution prevention as well as recommendatory provisions.

The Polar Code applies to new ships constructed after January 1, 2017, and after January 1, 2018, ships constructed before January 1, 2017 are required to meet the relevant requirements by the earlier of their first intermediate or renewal survey.

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This, in effect, makes all vessels delivered before the entry into force date “existing vessels” and allows for the installation of ballast water management systems on such vessels at the first International Oil Pollution Prevention (IOPP) renewal survey following entry into force of the convention.

The MEPC adopted updated guidelines for approval of ballast water management systems (G8) at MEPC 70.

At MEPC 71, the schedule regarding the BWM Convention’s implementation dates was also discussed and amendments were introduced to extend the date existing vessels are subject to certain ballast water standards.

Those changes were adopted at MEPC 72.

The MEPC maintainsguidelines for approval of ballast water management systems (G8).

At MEPC 72, amendments were adopted to extend the date existing vessels are subject to certain ballast water standards.

Ships over 400 gross tons generally must comply with a “D-1 standard,” requiring the exchange of ballast water only in open seas and away from coastal waters.

The “D-2 standard” specifies the maximum amount of viable organisms allowed to be discharged, and compliance dates vary depending on the IOPP renewal dates.

Depending on the date of the IOPP renewal survey, existing vessels must comply with the D-2 standard on or after September 8, 2019.

For most ships, compliance with the D-2 standard will involve installing on-board systems to treat ballast water and eliminate unwanted organisms.

The standards have been in force since 2019, and for most ships, compliance with the D-2 standard involved installing on-board systems to treat ballast water and eliminate unwanted organisms.

Ballast water management systems, which include systems that make use of chemical, biocides, organisms or biological mechanisms, or which alter the chemical or physical characteristics of the ballast water, must be approved in accordance with IMO Guidelines (Regulation D-3).

As of October 13, 2019, MEPC 72’s amendments to the BWM Convention took effect, making the Code for Approval of Ballast Water Management Systems, which governs assessment of ballast water management systems, mandatory rather than permissive, and formalized an implementation schedule for the D-2 standard.

Under these amendments, all ships must meet the D-2 standard by September 8, 2024.

Since September 8, 2024, all ships have been required to meet the D-2 standard.

Costs of compliance with these regulations may be substantial.

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In December 2022, MEPC 79 agreed that it should be permitted to use ballast tanks for temporary storage of treated sewage and grey water.

MEPC 79 also established that ships are expected to return to D-2 compliance after experiencing challenging uptake water and bypassing a BWM system should only be used as a last resort.

established that ships are expected to return to D-2 compliance after experiencing challenging uptake water and bypassing a BWM system should only be used as a last resort.

In July 2023, MEPC 80 approved a plan for a comprehensive review of the BWM Convention over the next three years and the corresponding development of a package of amendments to the Convention.

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A protocol for ballast water compliance monitoring devices and unified interpretation of the form of the BWM Convention certificate were also adopted.

In March 2024, MEPC 81 adopted amendments to the BWM Convention concerning the use of Ballast Water Record Books in electronic form, which are expected to enter into force in October 2025.

Pursuant to the ongoing review, in Fall 2024, MEPC 82 approved the 2024 Guidance on ballast water record keeping and reporting and the 2024 Guidance for Administrations on the type approval process for ballast water management systems to support harmonized evaluation by Administrations.

Once mid-ocean exchange ballast water treatment requirements become mandatory under the BWM Convention, the cost of compliance could increase for ocean carriers and may have a material effect on our operations.

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In 2001, the IMO adopted the International Convention on the Control of Harmful Anti-fouling Systems on Ships, or the “Anti-fouling Convention.” The Anti-fouling Convention, which entered into force on September 17, 2008, prohibits the use of organotin compound coatings to prevent the attachment of mollusks and other sea life to the hulls of vessels.

The exteriors of vessels constructed prior to January 1, 2003 that have not been in drydock must, as of September 17, 2008, either not contain the prohibited compounds or have coatings applied to the vessel exterior that act as a barrier to the leaching of the prohibited compounds.

The exteriors of vessels constructed prior to January 1, 2003 that have not been in drydock must, as of September 17, 2008, either not contain

the prohibited compounds or have coatings applied to the vessel exterior that act as a barrier to the leaching of the prohibited compounds.

Vessels of over 400 gross tons engaged in international voyages will also be required to undergo an initial survey before the vessel is put into service or before an International Anti-fouling System Certificate, or the “IAFS Certificate,” is issued for the first time;

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Noncompliance with the ISM Code or other IMO regulations may subject the ship owner or bareboat charterer to increased liability, may lead to decreases in available insurance coverage for affected vessels and may result in the denial of access to, or detention in, some ports.

The USCG and European Union authorities have indicated that vessels not in compliance with the ISM Code by applicable deadlines will be prohibited from trading in U.S.

The USCG and European Union authorities prohibit vessels not in compliance with the ISM Code by applicable deadlines from trading in U.S.

and European Union ports, respectively.

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The IMO in November 2014 adopted the International Code for Ships Operating in Polar Waters (the “Polar Code”), and related amendments to the International Convention for the Safety of Life at Sea (“SOLAS”) to make it mandatory.

The Polar Code is mandatory under both SOLAS and MARPOL because it contains both safety and environment related provisions.

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The Oil Pollution Act of 1990, ("OPA"), established an extensive regulatory and liability regime for the protection and cleanup of the environment from oil spills.

OPA affects all “owners and operators” whose vessels trade with the United States, its territories and possessions or whose vessels operate in United States waters, which includes the United States’ territorial sea and its 200 nautical mile exclusive economic zone around the United States.

OPA affects all “owners and operators” whose vessels trade or operate within the United States, its territories and possessions or whose vessels operate in United States waters, which includes the United States’ territorial sea and its 200 nautical mile exclusive economic zone around the United States.

The United States has also enacted the Comprehensive Environmental Response, Compensation and Liability Act, or CERCLA, which applies to the discharge of hazardous substances other than oil, whether on land or at sea.

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federal safety, construction or operating regulation by a responsible party (or its agent, employee or a person acting pursuant to a contractual relationship), or a responsible party’s gross negligence or willful misconduct.

The limitation on liability similarly does not apply if the responsible party fails or refuses to (i) report the incident where the responsibility party knows or has reason to know of the incident;

(ii) reasonably cooperate and assist as requested in

connection with oil removal activities;

The limitation on liability similarly does not apply if the responsible party fails or refuses to (i) report the incident as required by law where the responsible party knows or has reason to know of the incident;

(ii) reasonably cooperate and assist as requested in connection with oil removal activities;

or (iii) without sufficient cause, comply with an order issued under the Federal Water Pollution Act (Section 311 (c), (e)) or the Intervention on the High Seas Act.

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The limitation on liability also does not apply if the responsible person fails or refused to provide all reasonable cooperation and assistance as requested in connection with response activities where the vessel is subject to OPA.

OPA and CERCLA each preserve the right to recover damages under existing law, including maritime tort law.

OPA and CERCLA both require owners and operators of vessels to establish and maintain with the U.S.

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If the damages from a catastrophic spill were to exceed the Company’s insurance coverage it could have an adverse effect on its business and results of operation.

OPA specifically permits individual states to impose their own liability regimes with regard to oil pollution incidents occurring within their boundaries, provided they accept, at a minimum, the levels of liability established under OPA and some states have enacted legislation providing for unlimited liability for oil spills.

In some cases, states which have enacted such legislation have not yet issued implementing regulations defining vessel owners’ responsibilities under these laws.

Some states have enacted legislation providing for unlimited liability for oil spills, and many U.S.

states that border a navigable waterway have enacted environmental pollution laws that impose strict liability on a person for removal costs and damages resulting from a discharge of oil or a release of a hazardous substance.

Moreover, some states have enacted legislation providing for unlimited liability for discharge of pollutants within their waters, although in some cases, states which have enacted such legislation have not yet issued implementing regulations defining vessel owners’ responsibilities under these laws.

These laws may be more stringent than U.S.

The Company intends to comply with all applicable state regulations in the ports where its vessels call.

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The CWA also imposes substantial liability for the costs of removal, remediation and damages, and complements the remedies available under OPA and CERCLA.

Furthermore, many U.S.

These laws may be more stringent than U.S.

The EPA and the USCG have also enacted rules relating to ballast water discharge, compliance with which requires the installation of equipment on our vessels to treat ballast water before it is discharged or the implementation of other port facility disposal arrangements or procedures at potentially substantial costs, and/or otherwise restrict our vessels from entering U.S.

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ports or entering U.S.

VIDA establishes a new framework for the regulation of vessel incidental discharges under Clean Water Act (CWA), requires the EPA to develop

performance standards for those discharges within two years of enactment, and requires the U.S.

VIDA establishes a new framework for the regulation of vessel incidental discharges under Clean Water Act (CWA), requires the EPA to develop performance standards for those discharges within two years of enactment, and requires the U.S.

Coast Guard to develop implementation, compliance, and enforcement regulations within two years of EPA’s promulgation of standards.

On September 24, 2024, the EPA finalized its rule on Vessel Incidental Discharge Standards of Performance, which means that the USCG must now develop corresponding regulations regarding ballast water within two years of that date.

Under VIDA, all provisions of the 2013 VGP and USCG regulations regarding ballast water treatment remain in force and effect until the EPA and U.S.

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We have submitted NOIs for our vessels where required.

On October 26, 2020, the EPA published a Notice of Proposed Rulemaking for Vessel Incidental Discharge National Standards of Performance under

Within two years after the EPA publishes its final Vessel Incidental Discharge National Standards of Performance, the U.S.

Coast Guard must develop corresponding implementation, compliance and enforcement regulations regarding ballast water.

Compliance with the EPA, U.S.

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The European Union has adopted several regulations and directives requiring, among other things, more frequent inspections of high-risk ships, as determined by type, age, and flag as well as the number of times the ship has been detained.

The European Union also adopted and extended a ban on substandard ships and enacted a minimum ban period and a definitive ban for repeated offenses.

The European Union also adopted and extended a ban on substandard ships and enacted a minimum ban period and a definitive ban for

repeated offenses.

The regulations also provided the European Union with greater authority and control over classification societies, by imposing more requirements on classification societies and providing for fines or penalty payments for organizations that failed to comply.

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On September 15, 2020, the European Parliament voted to include greenhouse gas emissions from the maritime sector in the European Union’s carbon market, the EU Emissions Trading System (“EU ETS”) as part of its “Fit-for-55” legislation to reduce net greenhouse gas emissions by at least 55% by 2030 as compared to 1990 levels.

On July 14, 2021, the European Parliament formally proposed its plan, which would involve gradually including the maritime sector from 2023 and phasing the sector in over a three-year period.

This will require shipowners to buy permits to cover these emissions.

The Environment Council adopted a general approach on the proposal in June 2022.

On December 18, 2022, the Environmental Council and European Parliament agreed to include maritime shipping emissions within the scope of the EU ETS on a gradual introduction of obligations for shipping companies to surrender allowances equivalent to a portion of their carbon emissions:

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Compliance with the Maritime EU ETS will result in additional compliance and administration costs to properly incorporate the provisions of the Directive into our business routines.

Additionally, on July 25, 2023, the European Council of the European Union adopted the Maritime Fuel Regulation under the Fuel EU Initiative of its “Fit-for-55” package which sets limitations on the acceptable yearly greenhouse gas intensity of the energy used by covered vessels.

Among other things, the Maritime Fuel Regulation requires that greenhouse gas emissions from covered vessels are reduced by 2% starting January 1, 2025, with additional reductions contemplated every five years (up to 80% from January 1, 2050).

Additional EU regulations which are part of the EU’s "Fit-for-55," could also affect our financial position in terms of compliance and administration costs when they take effect.

Additionally, on July 25, 2023, the European Council of the European Union adopted the Maritime Fuel Regulation under the FuelEU Initiative of its “Fit-for-55” package which sets limitations on the acceptable yearly greenhouse gas intensity of the energy used by covered vessels.

Among other things, the Maritime Fuel Regulation requires that greenhouse gas emissions

from covered vessels are reduced by 2% starting January 1, 2025, with additional reductions contemplated every five years (up to 80% from January 1, 2050).

Greenhouse Gas Regulation

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Our governance, strategy, risk management and performance monitoring efforts with respect to managing this challenge continue to evolve.

Currently, the emissions of greenhouse gases from international shipping are not subject to the Kyoto Protocol of the United Nations Framework Convention on Climate Change, which entered into force in 2005 and pursuant to which adopting countries have been required to implement national programs to reduce greenhouse gas emissions with targets extended through 2020.

International negotiations are continuing with respect to a successor to the Kyoto Protocol, and restrictions on shipping emissions may be included in any new treaty.

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The 2015 United Nations Climate Change Conference in Paris resulted in the Paris Agreement, which entered into force on November 4, 2016 and does not directly limit greenhouse gas emissions from ships.

initially entered into the agreement, but on June 1, 2017, former U.S.

President Trump announced that the United States intended to withdraw from the Paris Agreement, and the withdrawal became effective on November 4, 2020.

On January 20, 2021, U.S.

President Biden signed an executive order to rejoin the Paris Agreement, which the U.S.

initially entered into the agreement, but on June 1, 2017, the Trump administration announced that the United States intended to withdraw from the Paris Agreement, and the withdrawal became effective on November 4, 2020.

On January 20, 2021, the Biden administration issued an executive order to rejoin the Paris Agreement, which the U.S.

officially rejoined on February 19, 2021.

In January 2025, President Trump signed an executive order to begin the withdrawal of the United States from the Paris Agreement.

At MEPC 70 and MEPC 71, a draft outline of the structure of the initial strategy for developing a comprehensive IMO strategy on reduction of greenhouse gas emissions from ships was approved.

In accordance with this roadmap, in April 2018, nations at the MEPC 72 adopted an initial strategy to reduce greenhouse gas emissions from ships.

The initial strategy identifies “levels of ambition” to reducing greenhouse gas emissions, including (1) decreasing the carbon intensity from ships through implementation of further phases of the EEDI for new ships;

(2) reducing carbon dioxide emissions per transport work, as an average across international shipping, by at least 40% by 2030, pursuing efforts towards 70% by 2050, compared to 2008 emission levels;

and (3) reducing the total annual greenhouse emissions by at least 50% by 2050 compared to 2008 while pursuing efforts towards phasing them out entirely.

The initial strategy notes that technological innovation, alternative fuels and/or energy sources for international shipping will be integral to achieve the overall ambition.

The initial strategy identifies “levels of ambition” to reduce greenhouse gas emissions, and notes that technological innovation, alternative fuels and/or energy

sources for international shipping will be integral to achieve the ambitions.

At MEPC 77, the Member States agreed to initiate the revision of the Initial IMO Strategy on Reduction of GHG emissions from ships, recognizing the need to strengthen the “levels of ambition.” In July 2023, MEPC 80 adopted the 2023 IMO Strategy on Reduction of GHG Emissions from Ships, which builds upon the initial strategy’s levels of ambition.

The revised levels of ambition include (1) further decreasing the carbon intensity from ships through improvement of energy efficiency;

(2) reducing carbon intensity of international shipping;

(3) increasing adoption of zero or near-zero emissions technologies, fuels, and energy sources;

and (4) achieving net zero GHG.

Furthermore, the following indicative checkpoints were adopted in order to reach net zero GHG emissions from international shipping:

i) reduce the total annual greenhouse gas emissions from international shipping by at least 20%, striving for 30%, by 2030, compared to 2008 levels;

reduce the total annual greenhouse gas emissions from international shipping by at least 70%, striving for 80%, by 2040, compared to 2008 levels.

In March 2024, MEPC 81 further developed the goal-based marine fuel standard regulating the phased reduction of marine fuel's GHG intensity as part of its mid-term measures.

In Fall 2024, MEPC 82 made further progress on the development of these mid-term measures, and the Committee is expected to approve amendments at MEPC 83 (Spring 2025) for adoption in October 2025.

These regulations could cause us to incur additional substantial expenses.

At MEPC 77, the Member States agreed to initiate the revision of the Initial IMO Strategy on Reduction of GHG emissions from ships, recognizing the need to strengthen the ambition during the revision process.

In July 2023, MEPC 80 adopted a revised strategy, which includes an enhanced common ambition to reach net-zero greenhouse gas emissions from international shipping around or close to 2050, a commitment to ensure an uptake of alternative zero and near-zero greenhouse gas fuels by 2030, as well as i).

reducing the total annual greenhouse gas emissions from international shipping by at least 20%, striving for 30%, by 2030, compared to 2008;

reducing the total annual greenhouse gas emissions from international shipping by at least 70%, striving for 80%, by 2040, compared to 2008.

At MEPC 80, the IMO also announced its intention to develop and approve mid-term greenhouse gas reduction measures by Spring 2025, with entry into force of those measures in 2027.

These measures include (1) a goal-based marine fuel standard regulating the phased reduction of the marine fuel's GHG intensity, and (2) a global carbon pricing mechanism.

The EU made a unilateral commitment to reduce overall greenhouse gas emissions from its member states from 20% of 1990 levels by 2020.

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Under the European Climate Law, the EU committed to reduce its net greenhouse gas emissions by at least 55% by 2030 through its “Fit-for-55” legislation package.

As part of this initiative, regulations relating to the inclusion of greenhouse gas emissions from the maritime sector in the European Union’s carbon market, EU ETS, are also forthcoming.

As part of this initiative, the European Union’s carbon market, EU ETS has been extended to cover CO2 emissions from all large ships entering EU ports starting January 2024..

In the United States, the EPA issued a finding that greenhouse gases endanger the public health and safety, adopted regulations to limit greenhouse gas emissions from certain mobile sources, and proposed regulations to limit greenhouse gas emissions from large stationary sources.

However, in March 2017, former U.S.

President Trump signed an executive order to review and possibly eliminate the EPA’s plan to cut greenhouse gas emissions, and in August 2019, the Administration announced plans to weaken regulations for methane emissions.

Further, on August 13, 2020, the EPA released rules rolling back standards to control methane and volatile organic compound emissions from new oil and gas facilities.

However, U.S.

President Biden recently directed the EPA to publish a proposed rule suspending, revising, or rescinding certain of these rules.

On November 2, 2021, the EPA issued a proposed rule under the CAA designed to reduce methane emissions from oil and gas sources.

The proposed rule would reduce 41 million tons of methane emissions between 2023 and 2035 and cut methane emissions in the oil

and gas sector by approximately 74 percent compared to emissions from this sector in 2005.

EPA issued a supplemental proposed rule in November 2022 to include additional methane reduction measures.

On December 2, 2023, the Biden Administration announced the final rule that includes updated and strengthened standards for methane and other air pollutants from new, modified, and reconstructed sources, as well as Emissions Guidelines to assist states in developing plans to limit methane emissions from existing sources.

These new regulations could potentially affect our operations.

However, in March 2017, the Trump administration issued an executive order to review and possibly eliminate the EPA’s plan to cut greenhouse gas emissions, and on August 13, 2020, the EPA released rules rolling back standards to control methane and volatile organic compound emissions from new oil and gas facilities.

In early 2021, the Biden administration directed the EPA to publish a proposed rule suspending, revising, or rescinding certain of these rules.

The resulting final rule was issued in December 2023.

Such rules may be subject to revision or revocation following the change in federal administration beginning in 2025.

The EPA or individual states could enact these or other environmental regulations that could affect our operations.

Any passage of climate control legislation or other regulatory initiatives by the IMO, the EU, the U.S.

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If any defects are found, the classification surveyor will issue a recommendation which must be rectified by the ship owner within prescribed time limits.

The Company expects to perform two special surveys in 2024 at an aggregate total cost of approximately $2.0 million.

The Company expects to perform nine special surveys in 2025 at an aggregate total cost of approximately $13.0 million.

The Company expects to perform four intermediate surveys in 2025 at an aggregate total cost of approximately $1.5 million.

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In addition, there is an inherent possibility of marine disaster, including oil spills (e.g.

fuel oil) and other environmental incidents, and the liabilities

arising from owning and operating vessels in international trade.

fuel oil) and other environmental incidents, and the liabilities arising from owning and operating vessels in international trade.

OPA, which imposes virtually unlimited liability for certain oil pollution accidents upon owners, operators and demise charterers of vessels trading in the United States exclusive economic zone, has made liability insurance more expensive for ship owners and operators trading in the U.S.

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The Company’s current protection and indemnity insurance coverage for pollution is $1.0 billion per vessel per incident.

The thirteen P&I Associations that comprise the International Group insure approximately 90% of the world’s commercial tonnage and have entered into a pooling agreement to reinsure each association’s liabilities.

The 12 P&I Associations that comprise the International Group insure approximately 90% of the world’s commercial tonnage and have entered into a pooling agreement to reinsure each association’s liabilities.

As a member of a P&I Association, which is a member of the International Group, the Company is subject to calls payable to the associations based on the group’s claim records as well as the claim records of all other members of the individual associations and members of the pool of P&I Associations comprising the International Group.

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Internal Revenue Code of 1986, as amended, or the Code, existing and proposed U.S.

Treasury Department regulations, or the Treasury Regulations, administrative rulings and

pronouncements and judicial decisions, all as of the date of this annual report.

Treasury Department regulations, or the Treasury Regulations, administrative rulings and pronouncements and judicial decisions, all as of the date of this annual report.

Unless otherwise noted, references to the “Company” include the Company’s Subsidiaries.

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Under the Treasury Regulations, our common shares are considered to be “regularly traded” on an established securities market if shares representing more than 50% of our outstanding common shares, by both total combined voting power of all classes of stock entitled to vote and total value, are listed on the market, referred to as the “listing threshold”.

The Treasury Regulations further

require that with respect to each class of stock relied upon to meet the listing threshold (i) such class of stock is traded on the market, other than in minimal quantities, on at least 60 days during the taxable year or 1/6 of the days in a short taxable year, which is referred to as the “trading frequency test”, and (ii) the aggregate number of shares of such class of stock traded on such market during the taxable year is at least 10% of the average number of shares of such class of stock outstanding during such year (as appropriately adjusted in the case of a short taxable year), which is referred to as the “trading volume test”.

The Treasury Regulations further require that with respect to each class of stock relied upon to meet the listing threshold (i) such class of stock is traded on the market, other than in minimal quantities, on at least 60 days during the taxable year or 1/6 of the days in a short taxable year, which is referred to as the “trading frequency test”, and (ii) the aggregate number of shares of such class of stock traded on such market during the taxable year is at least 10% of the average number of shares of such class of stock outstanding during such year (as appropriately adjusted in the case of a short taxable year), which is referred to as the “trading volume test”.

Even if we do not satisfy both the trading frequency and trading volume tests, the Treasury Regulations provide that the trading frequency and trading volume tests will be deemed satisfied if our common shares are traded on an established securities market in the United States and such stock is regularly quoted by dealers making a market in our common shares, such the Nasdaq Capital Market, on which our common shares are listed.

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In the event the 5 Percent Override Rule is triggered, the 5 Percent Override Rule will nevertheless not apply if we can establish that among the closely-held group of 5% Shareholders, there are sufficient 5% Shareholders that are considered to be “qualified shareholders” for purposes of Section 883 to preclude non-qualified 5% Shareholders in the closely-held group from owning 50% or more of our common shares for more than half the number of days during the taxable year.

In any year that the 5 Percent Override Rule is triggered with respect to us, we are eligible for the exemption from tax under Section 883 only if we can nevertheless satisfy the Publicly-Traded Test (which requires, among other things, showing that the exception to the 5 Percent Override Rule applies) or if we can satisfy the 50% Ownership Test.

exception to the 5 Percent Override Rule applies) or if we can satisfy the 50% Ownership Test.

In either case, certain substantiation and reporting requirements regarding the identity of our shareholders must be satisfied in order to qualify for the Section 883 exemption.

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Distributions of earnings and profits that had been previously taxed will result in a corresponding reduction in the adjusted tax basis in the common shares and will not be taxed again once distributed.

Holder would make a QEF Election with respect to any

taxable year that we are a PFIC by filing one copy of IRS Form 8621 with its U.S.

Holder would make a QEF Election with respect to any taxable year that we are a PFIC by filing one copy of IRS Form 8621 with its U.S.

federal income tax return.

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office of a non-U.S.

broker and the sales proceeds are paid to you outside the United States, then information reporting and backup withholding generally will not apply to that payment.

broker and the sales proceeds are paid to you outside the United States, then information reporting and

backup withholding generally will not apply to that payment.

However, U.S.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business