Pangaea Logistics Solutions Ltd. 10-K

ITEM 9A. CONTROLS AND PROCEDURES. Evaluation of Disclosure Controls and Procedures Management, with the participation of our Chief Executive Officer (“CEO”) and our Chief Financial Officer (“CFO”), evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2024. The term “disclosure controls and procedures,” as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls 74 and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Based on the evaluation performed as of December 31, 2024, as a result of the material weakness in internal control over financial reporting that is described below in Management's Report on Internal Control Over Financial Reporting, our Chief Executive Officer and Chief Financial Officer determined that the Company's disclosure controls and procedures were not effective as of such date. Notwithstanding our material weakness described below, we have concluded that the consolidated financial statements and other financial information included in this Form 10-K fairly present in all material respects our financial condition, results of operations and cash flows for the periods presented in conformity with accounting principles generally accepted in the U.S. ("U.S. GAAP"). Inherent Limitations over Internal Controls and Procedures Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud due to inherent limitations of internal controls. Because of such limitations, there is a risk that material misstatements will not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk. Management's Report on Internal Controls Over Financial Reporting Management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f) and 15d-15(f). Management, with the participation of our Chief Executive Officer and Chief Financial Officer, has conducted an evaluation of the effectiveness of the Company's internal control over financial reporting as of December 31, 2024, based on the framework set forth in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on that evaluation, management has concluded that the Company did not maintain effective internal control over financial reporting as of December 31, 2024 due to the material weakness described below. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of a company's annual or interim consolidated financial statements will not be prevented or detected on a timely basis. As of December 31, 2024, management identified a material weakness regarding the application of ASC 606, Revenue from Contracts with Customers (“ASC 606”), as it relates to certain reimbursements received from its customers for expenses incurred in servicing customer contracts. Consequently, this error resulted in an understatement, in identical amounts, of both voyage and charter revenue and voyage expenses. Management determined that review controls over the application of ASC 606 were not designed and implemented appropriately during the current year. Therefore, we concluded that the deficiency represents a material weakness in the Company’s internal control over financial reporting, and our internal control over financial reporting was not effective as of December 31, 2024. Notwithstanding our material weakness described above, there were no material misstatements of the consolidated financial statements and other financial information included in this Form 10-K and it fairly presents in all material respects our financial condition, results of operations and cash flows for the periods presented in conformity with accounting principles generally accepted in the U.S. ("U.S. GAAP") for all periods presented and it did not require any changes to previously issued financial results. Remediation Efforts Management is committed to remediating the material weakness described above. The Company has initiated efforts to design and implement effective internal controls to enhance financial reporting. These remediation efforts include: • Enhancing review and approval procedures for revenue recognition, including the implementation of additional validation controls within the voyage accounting system. • Strengthening supervisory review processes to ensure revenue transactions are properly classified in compliance with ASC 606. 75 • Implementing controls to align general ledger account mapping with the presentation of amounts in the consolidated financial statements. The Company expects that the actions described above and resulting improvements in controls will strengthen its internal control over financial reporting and will address the identified material weakness. We plan to fully implement and operate the redesigned processes and procedures in the upcoming fiscal year. The material weaknesses will not be considered formally remediated until these controls have operated effectively for a sufficient period of time and management has concluded, through testing, that the controls are operating effectively. Attestation Report of the Registered Public Accounting Firm on Internal Control over Financial Reporting The Company’s internal control over financial reporting as of December 31, 2024 has been audited by Grant Thornton LLP, an independent registered public accounting firm. As stated in their report, which is included herein, the firm issued an adverse opinion. Changes in Internal Control over Financial Reporting Other than the material weakness and on-going remediation efforts described above, there have been no changes in the Company's internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act), during the year ended December 31, 2024, that have materially affected, or are reasonably likely to materially affect our internal control over financial reporting. 76 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Board of Directors and Stockholders Pangaea Logistics Solutions Ltd. Opinion on internal control over financial reporting We have audited the internal control over financial reporting of Pangaea Logistics Solutions Ltd. (a Bermuda corporation) and subsidiaries (the “Company”) as of December 31, 2024, based on criteria established in the 2013 Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). In our opinion, because of the effect of the material weakness described in the following paragraphs on the achievement of the objectives of the control criteria, the Company has not maintained effective internal control over financial reporting as of December 31, 2024, based on criteria established in the 2013 Internal Control—Integrated Framework issued by COSO. A material weakness is a deficiency, or combination of control deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis. The following material weakness has been identified and included in management’s assessment. The Company did not design and maintain sufficient controls to ensure the appropriate classification of revenue transactions with certain expense reimbursements received from customers. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated financial statements of the Company as of and for the year ended December 31, 2024. The material weakness identified above was considered in determining the nature, timing, and extent of audit tests applied in our audit of the 2024 consolidated financial statements, and this report does not affect our report dated March 17, 2025 , which expressed an unqualified opinion on those financial statements. Basis for opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Controls Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and limitations of internal control over financial reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. 77 Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Other information We do not express an opinion or any other form of assurance on the remediation efforts described in the Management’s Report on Internal Control Over Financial Reporting. /s/ GRANT THORNTON LLP Boston, Massachusetts March 17, 2025 78 ITEM 9B. OTHER INFORMATION. None . 79 ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS. None. 80 PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE The information required to be disclosed under this Item 10 is incorporated herein by reference to the Company’s definitive proxy statement, which will be filed with the Commission pursuant to Regulation 14A within 120 days following the end of the Company’s most recent fiscal year (the “2025 Proxy Statement”). Information relating to our Code of Ethics and our Insider Trading Policy and Procedures is included as Exhibit 19.1 to this Report. We intend to satisfy the disclosure requirements under Item 5.05 of Form 8-K regarding amendment to, or waiver from, a provision of the Code of Ethics for our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions by posting such information on our website, https://www.pangaeals.com. ITEM 11. EXECUTIVE COMPENSATION Information regarding compensation of our executive officers is incorporated by reference to the text set forth in the 2025 Proxy Statement under the heading “Executive Compensation.” 81 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT, AND RELATED STOCKHOLDER MATTERS Information regarding the beneficial ownership of shares of our common stock by certain persons is incorporated by reference to the text set forth in the 2025 Proxy Statement under the heading “Security Ownership of Certain Beneficial Owners and Management.” ITEM 13. CERTAIN RELATIONSHIPS, RELATED PARTY TRANSACTIONS AND DIRECTOR INDEPENDENCE Information regarding certain of our transactions and director independence is incorporated by reference to the text set forth in the 2025 Proxy Statement under the heading “Certain Relationships and Related Transactions” and “Director Independence.” ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES Information regarding our accountant fees and services is incorporated by reference to the text set forth in the 2025 Proxy Statement under the heading “Ratification of Appointment of Independent Auditors.” 82 ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES Contents Page Report of Independent Registered Public Accounting Firm (PCAOB ID: 248 ) F- 2 Consolidated Financial Statements: Consolidated Balance Sheets F- 4 Consolidated Statements of Income F- 5 Consolidated Statements of Changes in Stockholders' Equity F- 6 Consolidated Statements of Cash Flows F- 7 Notes to Consolidated Financial Statements F- 8 F-1 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Board of Directors and Stockholders Pangaea Logistic Solutions Ltd. Opinion on the financial statements We have audited the accompanying consolidated balance sheets of Pangaea Logistics Solutions Ltd. (a Bermuda corporation) and subsidiaries (the “Company”) as of December 31, 2024 and 2023, the related consolidated statements of income, changes in stockholders’ equity, and cash flows for each of the two years in the period ended December 31, 2024, and the related notes collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in the 2013 Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”), and our report dated March 17, 2025 expressed an adverse opinion. Basis for opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical audit matter The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relate. Valuation of a Customer Receivable As described further in Note 3 to the financial statements, the Company had a significant customer who accounted for 35% of the accounts receivable balance as of December 31, 2024. We identified the analysis of the allowance for credit losses on this customer’s accounts receivable balance as a critical audit matter. The principal considerations for our determination that the analysis of the allowance for credit losses of the customer receivable is a critical audit matter is that there is a high degree of estimation uncertainty resulting from management's judgments around the customer’s ability to meet its remaining payment obligation under the contract. Auditing these judgements and estimates requires a high degree of auditor judgment and an increased extent of effort to assess the appropriateness of management’s estimates and assumptions used. F-2 Our audit procedures related to the recoverability of the customer receivable included the following, among others. • We tested the design and operating effectiveness of the Company’s internal controls over the recoverability of the customer receivable. • Evaluated management’s assessment on the expected recoverability. • Confirmed the outstanding balance and the completeness of the agreements with the customer. • Evaluated the financial statements and forecasts provided by the customer, analyzing the forecast in comparison to historical performance and industry outlook trends. • Inspected the application of cash collections during and subsequent to the year ended December 31, 2024. /s/ GRANT THORNTON LLP We have served as the Company’s auditor since 2013 . Boston, Massachusetts March 17, 2025 F-3 Pangaea Logistics Solutions Ltd. Consolidated Balance Sheets December 31, 2024 December 31, 2023 Assets Current Assets Cash and cash equivalents $ 86,805,470 $ 99,037,866 Accounts receivable (net of allowance of $ 5,492,901 and $ 5,657,837 at December 31, 2024 and 2023, respectively) 42,370,830 47,891,501 Inventories 32,848,241 16,556,266 Advance hire, prepaid expenses and other current assets 29,969,352 28,340,246 Total current assets 191,993,893 191,825,879 Fixed assets, at cost, net of accumulated depreciation of $ 151,951,990 and $ 127,015,253 , at December 31, 2024 and 2023, respectively 707,826,328 474,265,171 Finance lease right of use assets, at cost, net of accumulated depreciation of $ 10,697,881 and $ 10,539,384 at December 31, 2024 and 2023, respectively 28,771,531 30,393,823 Goodwill 3,104,800 3,104,800 Other Non-current Assets 4,760,529 5,590,295 Total assets $ 936,457,081 $ 705,179,968 Liabilities and stockholders' equity Current liabilities Accounts payable, accrued expenses and other current liabilities $ 46,581,567 $ 34,346,202 Related party payable 1,181,015 1,490,060 Deferred revenue 15,447,488 15,629,886 Current portion of long-term debt 16,576,195 30,751,726 Current portion of financing obligations 25,267,105 18,980,512 Current portion of finance lease liabilities 2,843,750 2,989,612 Dividends payable 1,210,991 1,146,321 Total current liabilities 109,108,111 105,334,319 Secured long-term debt, net 112,720,545 68,446,309 Financing Obligations, net 229,529,792 130,037,711 Finance lease liabilities, net 10,434,298 13,229,156 Long-term liabilities - other - Note 11 — 17,936,540 Commitments and contingencies - Note 12 Stockholders' equity: Preferred stock, $ 0.0001 par value, 1,000,000 shares authorized and no shares issued or outstanding — — Common stock, $ 0.0001 par value, 100,000,000 shares authorized, 64,961,433 and 46,466,622 shares issued and outstanding at December 31, 2024 and 2023, respectively 6,498 4,648 Additional paid-in capital 258,659,972 164,854,546 Retained Earnings 169,155,149 159,026,799 Total Pangaea Logistics Solutions Ltd. equity 427,821,619 323,885,993 Non-controlling interests 46,842,716 46,309,940 Total stockholders' equity 474,664,335 370,195,933 Total liabilities and stockholders' equity $ 936,457,081 $ 705,179,968 The accompanying notes are an integral part of these consolidated financial statements 4 Pangaea Logistics Solutions Ltd. Consolidated Statements of Income Years ended December 31, 2024 2023 Revenues: Voyage revenue $ 494,106,763 $ 468,580,914 Charter revenue 30,326,291 23,715,895 Terminal & stevedore revenue 12,103,192 6,971,025 Total revenue 536,536,246 499,267,834 Operating expenses: Voyage expense 237,478,669 227,434,670 Charter hire expense 130,763,801 111,033,537 Terminal & stevedore expenses 9,299,425 5,809,025 Vessel operating expenses 55,543,547 55,783,562 General and administrative 24,626,469 22,780,937 Depreciation and amortization 30,375,721 30,070,395 Loss on sale of vessels — 1,738,511 Total operating expenses 488,087,632 454,650,637 Income from operations 48,448,614 44,617,197 Other (expense) income: Interest expense ( 17,073,184 ) ( 17,025,547 ) Interest income 3,022,593 3,572,134 Income attributable to Non-controlling interest recorded as long-term liability interest expense ( 3,103,018 ) ( 462,150 ) Unrealized (loss) gain on derivative instruments ( 953,042 ) ( 2,925,347 ) Other income 1,427,530 761,485 Total other expense, net ( 16,679,121 ) ( 16,079,425 ) Net income 31,769,493 28,537,772 Income attributable to noncontrolling interests ( 2,866,110 ) ( 2,214,472 ) Net income attributable to Pangaea Logistics Solutions Ltd. $ 28,903,383 $ 26,323,300 Earnings per common share: Basic $ 0.64 $ 0.59 Diluted $ 0.63 $ 0.58 Weighted average shares used to compute earnings per common share Basic 45,391,855 44,773,899 Diluted 46,046,044 45,475,453 The accompanying notes are an integral part of these consolidated financial statements 5 Pangaea Logistics Solutions Ltd. Consolidated Statements of Changes in Stockholders' Equity Common Stock Additional Paid-in Capital Retained Earnings Total Pangaea Logistics Solutions Ltd. Equity Non-Controlling Interest Total Stockholders' Equity Shares Amount Balance at December 31, 2022 45,898,395 $ 4,590 $ 162,894,080 $ 151,327,392 $ 314,226,062 $ 54,495,468 $ 368,721,530 Share-based compensation — — 2,087,807 — 2,087,807 — 2,087,807 Issuance of restricted shares, net of forfeitures 568,227 58 ( 127,341 ) — ( 127,283 ) — ( 127,283 ) Distribution to Non-Controlling Interests — — — — — ( 10,400,000 ) ( 10,400,000 ) Common Stock Dividend — — — ( 18,623,893 ) ( 18,623,893 ) — ( 18,623,893 ) Net income — — — 26,323,300 26,323,300 2,214,472 28,537,772 Balance at December 31, 2023 46,466,622 $ 4,648 $ 164,854,546 $ 159,026,799 $ 323,885,993 $ 46,309,940 $ 370,195,933 Share-based compensation — — 2,788,190 — 2,788,190 — 2,788,190 Equity Consideration for Strategic Shipping Inc. Acquisition 18,059,342 1,806 91,017,280 — 91,019,086 — 91,019,086 Issuance of restricted shares, net of forfeitures 435,469 44 ( 44 ) — — — — Distribution to Non-Controlling interests — — — — — ( 2,333,334 ) ( 2,333,334 ) Common Stock Dividend — — — ( 18,775,033 ) ( 18,775,033 ) — ( 18,775,033 ) Net income — — — 28,903,383 28,903,383 2,866,110 31,769,493 Balance at December 31, 2024 64,961,433 $ 6,498 $ 258,659,972 $ 169,155,149 $ 427,821,619 $ 46,842,716 $ 474,664,335 The accompanying notes are an integral part of these consolidated financial statements 6 Pangaea Logistics Solutions, Ltd. Consolidated Statements of Cash Flows Years ended December 31, 2024 2023 Operating activities Net income $ 31,769,493 $ 28,537,772 Adjustments to reconcile net income to net cash provided by operations: Depreciation and amortization expense 30,375,721 30,070,395 Amortization of deferred financing costs 1,033,735 946,593 Amortization of prepaid rent 121,865 121,532 Unrealized loss on derivative instruments 953,042 2,925,347 Income from equity method investee ( 1,709,593 ) ( 684,470 ) Earnings attributable to non-controlling interest recorded as interest expense 3,103,018 462,150 Provision for doubtful accounts 1,835,064 2,938,879 Loss on sales of vessels — 1,738,511 Drydocking costs ( 6,202,093 ) ( 4,154,283 ) Share-based compensation 2,788,190 2,087,807 Change in operating assets and liabilities: Accounts receivable 3,685,607 ( 14,075,231 ) Inventories ( 11,030,458 ) 12,548,170 Advance hire, prepaid expenses and other current assets ( 2,688,870 ) ( 342,776 ) Accounts payable, accrued expenses, other current liabilities and related party payable 11,839,070 ( 4,079,047 ) Deferred revenue ( 182,398 ) ( 5,254,072 ) Net cash provided by operating activities 65,691,393 53,787,277 Investing activities Purchase of vessels and vessel improvements ( 69,264,985 ) ( 27,264,044 ) Proceeds from sale of vessels — 17,271,489 Acquisitions, net of cash acquired — ( 7,200,000 ) Purchase of equipment and internal use software ( 167,481 ) — Contribution to non-consolidated subsidiaries and other investments ( 171,699 ) ( 427,270 ) Dividends received from equity method investments 1,910,000 1,637,500 Net cash used in investing activities ( 67,694,165 ) ( 15,982,325 ) Financing activities Proceeds from long-term debt 64,150,000 — Payments of financing and issuance costs ( 2,043,785 ) — Payments of long-term debt ( 33,082,460 ) ( 15,782,528 ) Proceeds from financing obligations 25,000,000 — Payments on financing obligations ( 19,180,510 ) ( 11,295,522 ) Payments of finance leases ( 2,989,613 ) ( 8,942,609 ) Dividends paid to non-controlling interests ( 2,333,334 ) ( 10,400,000 ) Common stock accrued dividends paid ( 18,710,364 ) ( 18,103,750 ) Cash paid for incentive compensation shares relinquished — ( 127,283 ) Payments to non-controlling interest recorded as long-term liability ( 21,039,558 ) ( 2,500,000 ) Net cash used in financing activities ( 10,229,624 ) ( 67,151,692 ) Net (decrease) increase in cash and cash equivalents ( 12,232,396 ) ( 29,346,740 ) Cash and cash equivalents at beginning of period $ 99,037,866 $ 128,384,606 Cash and cash equivalents at end of period $ 86,805,470 $ 99,037,866 Supplemental cash flow items: Cash paid for interest $ 17,983,252 $ 18,850,078 Acquisition of Strategic Shipping Inc. through issuance of 18,059,342 shares of common stock, with a value of $ 91,019,086 , as non-cash consideration. $ 91,019,086 $ — Fair value of loans and lease liabilities (ASC 842) assumed $ 100,049,292 $ — The accompanying notes are an integral part of these consolidated financial statements F-7 NOTE 1 - GENERAL INFORMATION Pangaea Logistics Solutions Ltd. and its subsidiaries (collectively, the “Company” or “Pangaea”) provides seaborne drybulk logistics and transportation 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, pig iron, hot briquetted iron, bauxite, alumina, cement clinker, dolomite and limestone. The Company addresses the logistics needs of its customers by undertaking a comprehensive set of services and activities, including cargo loading, cargo discharge, vessel chartering, voyage planning, and technical vessel management. As of December 31, 2024, the Company owned three Panamax, two Ultramax Ice Class 1C, two Ultramax and nine Supramax vessels. The Company owns two-thirds of its consolidated subsidiary Nordic Bulk Holding Company Ltd. (“NBHC”) which owns a fleet of six Panamax Ice Class 1A drybulk vessels. The Company owned 50 % of Nordic Bulk Partners LLC. ("NBP") which owns a fleet of four Post Panamax Ice Class 1A drybulk vessels. On November 6, 2024, Pangaea Logistics Solutions Ltd. completed the acquisition of the remaining 50 % equity ownership in Nordic Bulk Partners LLC from HS Nordic LLC for $ 19.0 million in cash, thereby securing full ownership of Nordic Bulk Partners. Refer to "Note 11, Other Long-Term Liabilities". The Company owns fifteen Handysize vessels acquired through the Strategic Shipping Inc. merger. The Company also has a 50 % interest in the owner of a deck barge. Additionally, the Company owns port and terminal operations located in Fort Lauderdale, Florida, and Baltimore, Maryland. NOTE 2 – NATURE OF ORGANIZATION The consolidated financial statements include the operations of Pangaea Logistics Solutions Ltd. and its wholly-owned subsidiaries (collectively referred to as “the Company”), as well as other entities consolidated pursuant to Accounting Standards Codification (“ASC”) 810, Consolidation . A summary of the Company’s consolidation policy is provided in Note 3. A summary of the Company’s variable interest entities is provided at Note 5. At December 31, 2024 and 2023, entities that are consolidated pursuant to ASC 810-10, but which are not wholly-owned, include the following: • Nordic Bulk Holding Company Ltd. (“NBHC”) - a corporation that was duly organized under the laws of Bermuda. NBHC was established in October 2012, for the purpose of owning Bulk Nordic Odyssey Ltd. (“Bulk Odyssey”) and Bulk Nordic Orion Ltd. (“Bulk Orion”) and to invest in additional vessels through its wholly-owned subsidiaries. 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 equity interest of NBHC after the acquisition and the remainder one-third equity interest is owned by a third-party at December 31, 2024. The Company determined that NBHC is a VIE and that it is the primary beneficiary of NBHC, as it has the power to direct its activities through time charter arrangements with Pangaea Denmark covering all of its owned vessels. Accordingly, the Company has consolidated NBHC for the years ended December 31, 2024 and 2023. Bulk Odyssey, Bulk Orion, Bulk Nordic Oshima Ltd. (“Bulk Oshima”), Bulk Nordic Olympic Ltd. (“Bulk Olympic”), Bulk Nordic Odin Ltd. (“Bulk Odin”) and Bulk Nordic Oasis Ltd. (“Bulk Oasis”), corporations duly organized under the laws of Bermuda between March 2012 and February 2015, are owned by NBHC. These entities were established for the purpose of owning m/v Nordic Odyssey, m/v Nordic Orion, m/v Nordic Oshima, m/v Nordic Olympic, m/v Nordic Odin and m/v Nordic Oasis, respectively. On December 23, 2020 NBHC formed two new wholly owned subsidiaries, Bulk Nordic Odyssey (MI) Corp., and Bulk Nordic Orion (MI) Corp. for the purpose of transferring ownership of the m/v Nordic Odyssey and m/v Nordic Orion to these companies respectively. On January 21, 2021 NBHC formed four new wholly owned subsidiaries, Bulk Nordic Oasis (MI) Corp., Bulk Nordic Odin (MI) Corp., Bulk Nordic Olympic (MI) Corp., and Bulk Nordic Oshima (MI) Corp. for the purpose of transferring ownership of the m/v Nordic Oasis, m/v Nordic Odin, m/v Nordic Olympic and m/v Nordic Oshima to these companies respectively. • Venture Logistics NL Inc. ("VLNL") - a corporation that was duly organized m/v in Newfoundland and Labrador, Canada on October 19, 2018. VLNL was established for the purpose of owning and operating a deck barge. At December 31, 2024 the Company had a 50 % ownership interest in VLNL with the other 50 % ownership interest owned by the independent third-party. 8 • Nordic Bulk Partners LLC. (“NBP”) – a corporation that was duly organized under the laws of the Marshall Island. NBP was established in September 2019 for the purpose of providing funding to Bulk Seven, Bulk Eight, Bulk Nine, and Bulk Ten for the construction of four newbuilding vessels and subsequently at completion and delivery of the newbuilding vessels owning Bulk Seven, Bulk Eight, Bulk Nine, and Bulk Ten. Bulk Seven, Bulk Eight, Bulk Nine and Bulk Ten are corporations that were duly organized under the laws of the Marshall Islands in September 2019 for the purpose of constructing and owning Post-Panamax newbuilding vessels named m/v Nordic Nuluujaak, m/v Nordic Qinngua, m/v Nordic Sanngijuq and m/v Nordic Siku, respectively, the four newbuilding vessels were delivered in 2021. On November 6, 2024, Pangaea Logistics Solutions Ltd. completed the purchase of the 50 % equity ownership of Nordic Bulk Partners LLC from HS Nordic LLC for $ 19.0 million in cash, resulting in Pangaea owning 100 % of Nordic Bulk Partners. At December 31, 2024 the Company had a 100 % ownership interest in NBP. NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES This summary of significant accounting policies of the Company and its subsidiaries is presented to assist in understanding the Company’s consolidated financial statements. These accounting policies conform to accounting principles generally accepted in the United States, and have been applied in the preparation of the consolidated financial statements. Basis of Presentatio n The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP"). The accompanying consolidated financial statements present separately our financial position, results of operations, cash flows, and changes in shareholders’ equity. All intercompany balances and transactions have been eliminated. Certain reclassifications have been made to prior periods to conform to current period presentation. Principles of Consolidation The purpose of consolidated financial statements is to present the financial position and results of operations of a company and its subsidiaries as if the group were a single company. The first step in the Company’s consolidation policy is to determine whether an entity is to be evaluated for potential consolidation based on its outstanding voting interests or its variable interests. Accordingly, the Company first determines whether the entity is a Variable Interest Entity (“VIE”) pursuant to the provisions of ASC 810-10. If the entity is a VIE, consolidation is based on the entity’s variable interests and not its outstanding voting shares. If the entity is not determined to be a VIE, the Company evaluates the entity based on its outstanding voting interests. Amounts pertaining to the non-controlling interests and redeemable noncontrolling interests held by third parties in the financial position and operating results of the Company’s subsidiaries and/or consolidated VIEs are reported as non-controlling interest and redeemable noncontrolling interests in the accompanying consolidated balance sheets. As part of the Company’s consolidation process, all intercompany balances and transactions are eliminated in the consolidated financial statements. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include: • The fair value of assets and liabilities acquired in business combinations, including assumptions used in purchase price allocations. • The assessment of long-lived assets for impairment under ASC 360, which involves assumptions about future cash flows, discount rates, and other relevant factors. • The percentage completion of spot voyages. • The establishment of the allowance for credit losses. • The estimate of salvage value used in determining vessel depreciation expense. 9 Management reviews these estimates periodically and reflects the effects of revisions in the period in which they are determined. Revenue Recognition Voyage revenues represent revenues earned by the Company, principally from providing transportation services under voyage charters. A voyage charter involves the carriage of a specific amount and type of cargo on a load port to discharge port basis, subject to various cargo handling terms. Under a voyage charter, the service revenues are earned and recognized ratably over the duration of the voyage. The voyage contract generally has standard payment terms of 95% freight paid within three days after completion of loading. The Company acts as the principal in these contracts. Demurrage, which is included in voyage revenues, represents payments by the charterer to the vessel owner when loading and discharging time exceed the stipulated time in the voyage charter. The voyage charter party generally has a “demurrage” or “despatch” clause. As per this clause, the charterer reimburses the Company for any potential delays exceeding the allowed laytime as per the charter party clause at the ports visited which is recorded as demurrage revenue. Conversely, the charterer is given credit if the loading/discharging activities happen within the allowed laytime known as despatch resulting in a reduction in revenue. In a voyage charter contract, the performance obligations begin to be satisfied once the vessel begins loading the cargo. The demurrage and despatch represent variable consideration which is estimated at contract inception. Such estimates are updated and constrained. Voyage revenue recognized is presented net of address commissions. Charter revenues relate to a time charter arrangement under which the Company is paid to provide transportation services on a per day basis for a specified period of time. Revenues from time charters are earned and recognized on a straight-line basis over the term of the charter, as the charters do not fall under the scope of ASC 606. Revenue is not earned when vessels are offhire. The Company acts as the principal in these contracts. Costs incurred in fulfillment of a contract that meet certain criteria are deferred and recognized when or as the related performance obligations are satisfied. The contract fulfillment costs consist primarily of the fuel consumption that is incurred by the Company from the latter of the end of the previous vessel employment and the contract date until the arrival at the loading port in addition to any port expenses incurred prior to arrival at the load port, as well as any charter hire expenses for third party vessels that are chartered-in. The fuel consumption and any port expenses incurred prior to arrival at the load port during this period are capitalized and recorded in Bunker inventory and Advance hire, prepaid expenses and other current assets, respectively in the Consolidated Balance Sheets and are amortized ratably over the total transit time of the voyage from arrival at the loading port until the vessel departs from the discharge port and expensed as part of Voyage expense. As of December 31, 2024 and 2023, the Company recognized $ 2.2 million and $ 2.3 million , respectively, of deferred costs which represents bunker expenses and charter hire expenses incurred prior to commencement of loading. These costs are recorded in Advance hire, prepaid expenses and other current assets in the Consolidated Balance Sheet and are expensed as part of Voyage expense and Charter hire expense. Similarly, for any third party vessels that are chartered-in, the charter hire expenses during this period are capitalized and recorded in Advance hire, prepaid expenses and other current assets in the Consolidated Balance Sheets and are expensed as part of Charter hire expense. The performance obligations under our contracts are transportation services, which are received and consumed by our customers over time, as we perform the services. Revenues are recognized using the input method, proportionate to the days elapsed since the service commencement compared to the total days anticipated to complete the service. Under the ASC 606 revenue recognition standard, voyage revenue is recognized over the period between load port and discharge port. Costs to fulfill contracts for voyages for which loading has not commenced are recognized as assets and amortized pro rata over the period between load and discharge. Costs to obtain a contract are expensed as incurred, as provided by a practical expedient, since all such costs are expected to be amortized over less than one year. Assets and liabilities related to our voyage contracts with customers are reported on a contract-by-contract basis at the end of each reporting period. Contract assets also include accounts receivable for amounts billed and currently due from customers, which are reported at their net estimated realizable value. The Company maintains reserves against its accounts receivable for potential credit losses, which were immaterial for the years ended December 31, 2024 and 2023, respectively. Other contract assets include accrued receivables which arise when revenue is recognized in advance of billing for certain voyage contracts and hire paid to ship-owners in advance. Contract liabilities consist of deferred revenue which arises when amounts are billed to or collected from customers in advance of revenue recognition and are recognized within twelve months of the balance sheet date. The Company’s revenue recognition includes variable consideration in certain contracts, which is assessed based on the terms of each agreement. 10 • In a stevedoring service contract the Company is paid to provide cargo handling services on a per unit basis for a specified quantity of cargo. The consideration in such a contract is determined on the basis of a rate per unit of cargo handled. T he contract may contain minimum quantities. The contract transaction price is allocated to each performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The Company allocates the transaction price to each obligation at contract inception based on expected cost plus margin. • In a terminal service contract the Company is paid to perform a broad range of activities at port terminals. This includes labor, storage, handling, and transfer of cargo within the terminal area. We recognize revenue over time or at a point in time, depending on the nature of the performance obligation contained in the respective contract with our customer. The Company acts as an agent in certain performance obligations. The Company evaluates variable consideration at contract inception and updates estimates as necessary, ensuring that recognized revenue reflects the expected amount, subject to constraints to avoid significant reversals. The transaction price is allocated based on the relative stand-alone selling price of each performance obligation. As a practical expedient, the Company has elected not to disclose the aggregate amount of the transaction price allocated to unsatisfied performance obligations for our contracts that had an original expected duration of less than one year. Deferred Revenue Billings for services for which revenue is not recognized in the current period are recorded as deferred revenue. Deferred revenue recognized in the accompanying consolidated balance sheets is expected to be realized within twelve months of the balance sheet date. Deferred revenue as of December 31, 2022 was $20.9 million. All deferred revenue recorded on the consolidated balance sheets as of December 31, 2023 and December 31, 2022 was recognized during 2024 and 2023, respectively. Voyage Expenses The Company incurs expenses for voyage charters that include bunkers (fuel), port charges, canal tolls, broker commissions and cargo handling operations, which are expensed as incurred. Charter Expenses The Company charters in vessels to supplement its owned fleet to support its voyage charter operations. The Company hires vessels under time charters with third party vessel owners, and recognizes the charter hire payments as an expense on a straight-line basis over the term of the charter. Charter hire payments are typically made in advance, and the unrecognized portion is reflected as advance hire in the accompanying consolidated balance sheets. Under time charters, the vessel owner is responsible for the vessel operating costs such as crews, maintenance and repairs, insurance, and stores. Vessel Operating Expenses Vessel operating expenses (“VOE”) represent the cost to operate the Company’s owned vessels. VOE include crew wages and related costs, the cost of insurance, expenses relating to repairs and maintenance, the cost of spares and consumables, other miscellaneous expenses, and technical management fees. Technical management services include day-to-day vessel operations, performing general vessel maintenance, ensuring regulatory and classification society compliance, arranging the hire of crew and purchasing stores, supplies and spare parts. These expenses are recognized as incurred. Terminal & Stevedore Expenses Terminal & Stevedore expenses represent the cost to provide the Company's cargo handling services. Terminal & Stevedore expenses include direct labor and related costs, the cost of insurance, expenses relating to repairs and maintenance of shore based equipment, trucking, and other direct miscellaneous expenses. Concentrations of Credit Risk The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash equivalents, trade receivables and derivative instruments. The Company has certain domestic and foreign cash balance that exceed the insured limits set by the Federal Deposit Insurance Corporation (FDIC) in the United States and equivalent regulatory agencies in countries. The Company maintains its cash accounts with various high-quality financial institutions in the United States, 11 Germany, and Bermuda. The Company performs periodic evaluations of the relative credit standing of these financial institutions. The Company does not believe that significant concentration of credit risk exists with respect to these cash equivalents. Trade accounts receivable are recorded at the invoiced amount, and do not bear interest. The Company performs ongoing credit evaluations of its customers’ financial condition, but does not require collateral. Historically, credit risk with respect to trade accounts receivable has been considered minimal due to the long-standing relationships with significant customers, and their relative financial stability. However, current economic conditions could impact the collectability of certain customers' trade receivables, which could have a material effect on the Company's results of operations. Derivative instruments are recorded at fair value. The Company does not have any off-balance sheet credit exposure related to its customers. At December 31, 2024, two customers collectively represented 49 % of the Company’s trade accounts receivable, one accounted for 35 % and the other accounted for 14 %. At December 31, 2023, there were two customers that accounted for 57 % of the Company’s trade accounts receivable, one accounted for 35 % and the other accounted for 22 %. At December 31, 2024, the United States and Canada accounted for 67 % of accounts receivable. At December 31, 2023, the United States and Canada accounted for 70 % of accounts receivable. For the year ended December 31, 2024, the Company had two countries that accounted for at least 10% of revenue; the United States represents 32 % and Canada represents 14 %. F or the year ended December 31, 2023, the Company had three countries that accounted for at least 10% of revenue; the United States represents 29 %, Canada represents 15 %, and The United Kingdom represents 12 %. For the year ended December 31, 2024, one customer accounted for 10 % or more of total revenue. For the year ended December 31, 2023, two customers accounted for 10 % or more of total revenue. Cash and Cash Equivalents Cash comprises cash on hand. Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash, are subject to an insignificant risk of change in value, and have original maturities of three months or less. Allowance for Credit Losses The Company maintains a specific reserve for outstanding accounts that are considered partially or fully uncollectible. Additionally, reserves for accounts receivable are established based on account aging and historical collection trends. These reserves are adjusted as new information becomes available or payments are received. At December 31, 2022, the allowance for credit losses was $ 4,367,848 . At December 31, 2024, and 2023, the Company provided an allowance for credit losses of $ 5,492,901 and $ 5,657,837 respectively, for amounts that are not expected to be fully collected. The provision for credit losses was $ 1,835,064 in 2024 and $ 2,938,879 in 2023. Write-offs totaled $ 2,000,000 in 2024 and $ 1,648,890 in 2023, reflecting amounts determined to be uncollectible. Bunker Inventory Inventory is primarily comprised of fuel oil purchased and stored onboard a vessel. Inventory is measured at the lower of cost under the first-in, first-out method or net realizable value. Advance Hire, Prepaid Expenses and Other Current Assets Advance hire represents payment to ship owners under time-charters for days subsequent to the balance sheet date. Hire is typically paid in advance for the following fifteen days, but intervals vary by time-charter contract. Prepaid expenses include advance funding to the technical manager for vessel operating expenses, lubricating oils and stores kept on board owned vessels, certain voyage expenses paid in advance and direct costs incurred to fulfill a COA ("Contract of Affreightment"). These specifically identified costs are used to satisfy the contract and are expected to be recovered over the term of the COA. Such costs are amortized on a straight-line basis and charged equally to each of the voyages under the contract. Accrued receivables include accrued demurrage and balance of freight receivable. Other assets include deposits held by counterparties to various derivative instruments and the fair value of derivative instruments when it exceeds the settlement price of the instrument. 12 At December 31, advance hire, prepaid expenses and other current assets were comprised of the following: 2024 2023 Advance hire $ 3,348,104 $ 2,509,313 Prepaid expenses 9,517,482 7,072,634 Accrued receivables 7,352,376 5,777,596 Cash margin on deposit 3,268,455 3,751,257 Derivative assets 2,047,196 3,384,137 Other current assets 4,435,739 5,845,309 Total $ 29,969,352 $ 28,340,246 Other Non-current Assets At December 31, other non-current assets were comprised of the following: Name 2024 2023 Intangible Assets, net - Note 15: Acquisitions (1) $ 1,008,669 $ 1,777,063 Investment in Seamar Managements S.A. 236,219 706,655 Investment in Bay Stevedoring 1,894,927 1,667,093 Investment in Narragansett Bulk Carriers (US) Corp 519,975 519,975 Other investments 1,100,739 919,509 Total $ 4,760,529 $ 5,590,295 (1) Intangible assets represent acquired assets, including licenses, contracts, and other rights, net of accumulated amortization totaling $ 1,242,431 . Vessels and Depreciation Vessels are stated at cost, which includes contract price and acquisition costs. Significant improvements to vessels are capitalized; maintenance and repairs that do not improve or extend the lives of the vessels are expensed as incurred. Depreciation is provided using the straight-line method over the remaining estimated useful lives of the vessels (excluding the time a vessel is in dry dock), based on cost less salvage value. Each vessel’s salvage value is equal to the product of its lightweight tonnage and an estimated scrap rate of $ 300 per ton, which was determined by reference to quoted rates and is reviewed annually. The Company estimates the useful life of its vessels to be 25 years to 30 years from the date of initial delivery from the shipyard. The remaining estimated useful lives of the current fleet are 8 - 22 years. The Company does not incur depreciation expense when vessels are taken out of service for dry docking. Vessels held for sale are carried at estimated fair value less cost to sell. No additional depreciation expense is recorded for vessels categorized as held for sale. Deferred Drydock Cost Significant upgrades made to the vessels during dry docking are capitalized when incurred and amortized on a straight-line basis over the 5 year period until the next dry docking for vessels younger than 15 years, and over the 2.5 years period until next dry docking for vessels older than 15 years at time of dry docking. Costs capitalized as part of the dry docking include direct costs incurred to meet regulatory requirements that add economic life to the vessel, that increase the vessel’s earnings capacity or which improve the vessel’s efficiency. Direct costs include the shipyard costs, parts, inspection fees, steel, blasting and painting. These costs are recorded in Fixed assets, net or Finance lease right of use assets, net on the Consolidated Balance Sheets. Expenditures for normal maintenance and repairs, whether incurred as part of the dry docking or not, are expensed as incurred. Unamortized dry-docking costs of vessels that are sold are written off and included in the calculation of the resulting gain or loss on sale. 13 Long-lived Assets Impairment Considerations The Company evaluates the recoverability of its fixed assets and other assets in accordance with ASC 360-10-15, Impairment or Disposal of Long-Lived Assets, which requires impairment losses to be recorded on long-lived assets used in operations when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than their carrying amounts. If indicators of impairment are present, we perform an analysis of the anticipated undiscounted future net cash flows to be derived from the related long-lived assets. Our assessment is made at the asset group level, which represents the lowest level for which identifiable cash flows are largely independent of other groups of assets. The asset groups established by the Company are defined by vessel size and major characteristic or trade. The significant factors and assumptions used in the undiscounted projected net operating cash flow analysis include the Company’s estimate of future time charter equivalent "TCE" rates based on current rates under existing charters and contracts. When existing contracts expire, the Company uses an estimated TCE based on actual results and extends these rates out to the end of the vessel’s useful life. TCE rates can be highly volatile, may affect the fair value of the Company’s vessels and may have a significant impact on the Company’s ability to recover the carrying amount of its fleet. Accordingly, the volatility is contemplated in the undiscounted projected net operating cash flow by using a sensitivity analysis based on percent changes in the TCE rates. The Company prepares a series of scenarios in an attempt to capture the range of possible trends and outcomes. Projected net operating cash flows are net of brokerage and address commissions and assume no revenue on scheduled offhire days. The Company uses the current vessel operating expense budget, estimated costs of drydocking and historical general and administrative expenses as the basis for its expected outflows, and applies an inflation factor it considers appropriate. The net of these inflows and outflows, plus an estimated salvage value, constitutes the projected undiscounted future cash flows. If these projected cash flows do not exceed the carrying value of the asset group, an impairment charge would be calculated. Measurement of the impairment loss is based on the fair value of the asset as provided by third parties. The Company concluded that no triggering event occurred during the twelve months ended December 31, 2024, which would require impairment testing. In both the first and fourth quarters of 2023, the Company identified triggering events associated with the sale of vessels, where the carrying value exceeded their fair value. On January 18, 2023, the Company entered into a memorandum of agreement to sell the m/v Bulk Newport for $ 8.9 million in net consideration after brokerage commissions, resulting in a recorded loss on sale of $ 1.2 million in the first quarter of 2023. Similarly, on October 17, 2023, the Company signed a memorandum of agreement to sell the m/v Bulk Trident for $ 9.5 million in net consideration after brokerage commissions, resulting in a loss on sale of $ 0.6 million in the fourth quarter of 2023. The Company conducted an impairment analysis on each asset group and determined that the estimated undiscounted future cash flows exceeded their carrying amounts. Therefore, no additional loss on impairment was recognized. Also the Company concluded that no other triggering event had occurred during the remaining period of 2023 which would require impairment testing. Financing Costs Qualifying expenses associated with commercial financing and fees paid to financial institutions to obtain financing are carried as a reduction of the outstanding debt and amortized over the term of the arrangement using the effective interest method. The unamortized portion is included as a reduction of secured long-term debt on the consolidated balance sheets. The components of net debt issuance costs and bank fees, which are included in secured long-term debt on the consolidated balance sheets are as follows: December 31, 2024 2023 Debt issuance costs and bank fees paid to financial institutions $ 7,599,543 $ 7,599,543 Additional debt issuance costs 2,043,785 — Less: accumulated amortization ( 5,142,820 ) ( 4,109,086 ) Unamortized debt issuance costs and bank fees $ 4,500,508 $ 3,490,457 Amortization included in interest expense $ 1,033,735 $ 946,593 14 Accounts Payable and Accrued Expenses The components of accounts payable and accrued expenses are as follows: December 31, 2024 2023 Accounts payable $ 14,817,287 $ 6,277,693 Accrued expenses 11,530,275 14,038,418 Bunkers suppliers 7,700,506 4,393,533 Charter hire payable 10,420,101 8,112,701 Other accrued liabilities 2,916,393 3,013,917 Total $ 47,384,562 $ 35,836,262 Taxation Changes to Bermuda tax policies may impact our financial position. Under current Bermuda law, we are not subject to tax on income, profits, withholding, capital gains or capital transfers. Furthermore, we obtained from the Minister of Finance of Bermuda under the Exempted Undertakings Tax Protection Act 1966 (as amended) (the “EUTP Act”) an assurance that, in the event Bermuda enacts legislation imposing tax computed on profits, income, any capital asset, gain or appreciation, or any tax in the nature of estate duty or inheritance tax, then the imposition of the tax will not be applicable to us or our operations or to our ordinary shares, debentures or other obligations except insofar as such tax applies to persons ordinarily resident in Bermuda or to any taxes payable by us in respect of real property owned or leased by us in Bermuda until March 31, 2035. As a result of changes made to the EUTP Act by the CIT Act (as defined below), this assurance has been made subject to the application of any taxes pursuant to the CIT Act, as described further below. In the 2023 Budget, the Bermuda government announced the formation of an International Tax Working Group consisting of specialists in international tax matters and representatives of various bodies whose members may be directly impacted by such to examine how Bermuda can appropriately implement the Global Minimum Tax initiative. The Working Group reported its findings and provided recommendations to the Bermuda Government in July 2023. The Bermuda Government subsequently issued three public consultation papers as part of its considerations on the introduction of a corporate income tax in Bermuda, on August 8, 2023, October 5, 2023 and November 10, 2023. On December 15, 2023, the Bermuda House of Assembly passed the Corporate Income Tax Act, 2023 (the “CIT Act”) which was also passed by the Senate on December 18, 2023 and will become fully operative with respect to the imposition of corporate income tax on January 1, 2025. Under the CIT Act, Bermuda corporate income tax will be chargeable in respect of fiscal years beginning on or after January 1, 2025 and will apply only to Bermuda entities that are part of MNE groups with EUR 750 million or more in annual revenues in at least two of the four fiscal years immediately preceding the fiscal year in question (“Bermuda Constituent Entity Group”). Where corporate income tax is chargeable to a Bermuda Constituent Entity Group, the amount of corporate income tax chargeable for a fiscal year shall be (1) 15% of the net taxable income of the Bermuda Constituent Entity Group less (2) tax credits applicable to the Bermuda Constituent Entity Group under Part 4 of the CIT Act, or as prescribed. The CIT Act introduces certain “qualified refundable tax credits” which are set to be developed during 2024 to incentivize companies to support Bermuda residents through investments in key areas such as education, healthcare, housing, and other projects to help develop Bermuda’s workforce. Bermuda will continue to monitor further developments around the world as other jurisdictions address the OECD’s standards. The imposition of a Bermuda corporate income tax could, if applicable to the Company (or any Bermuda incorporated subsidiary of the Company), have a material adverse effect on the Company’s financial condition and results of operations. Pangaea Denmark, a wholly-owned subsidiary of the Company, is subject to a Danish tonnage tax. Pangaea Denmark is not taxed on the basis of their actual income derived from their business but on an alternative income determination based on the net tons carrying capability of their fleet. As the tax is not determined based on taxable income, Pangaea Denmark’s tax expense of approximately $ 389,000 and $ 417,000 is included within voyage expenses in the accompanying consolidated statements of income as of December 31, 2024 and 2023, respectively. Shipping income derived from sources outside the United States is not subject to any United States federal income tax. U.S. sourced income from the international operation of ships that is considered qualified income and earned by a qualified foreign corporation can also be considered exempt from U.S. federal income taxation. The exemption requires a number of tests be met including qualifying income earned subject to an equivalent exemption in a qualified country and a qualified foreign corporation meeting the qualified foreign country, qualified income, stock ownership tests and substantiation requirements. The 15 Company believes it meets all of the tests to qualify for an exemption from income under Internal Revenue Code section 883. To the extent the Company is unable to qualify for the exemption, the Company would be subject to U.S. federal income taxation of 4% of its U.S. shipping income on a gross basis without deductions. If certain other conditions are present, as defined in the Code, U.S. source shipping income, net of applicable deductions, may be subject to federal income tax of up to 21% and a 30% branch profits tax. The company believes that none of its U.S. source shipping income is effectively connected with the conduct of a U.S. trade or business. The earnings from shipping operations of the Company are not subject to U.S. or foreign income taxation. However, due to the U.S. based terminal acquisitions that occurred in June 2023, the company's operations within these terminals is subjected to U.S. income taxation from its US-based operations. On June 1, 2023, the Company acquired two port terminal operations, one in Baltimore, Maryland and the other in Ft. Lauderdale, Florida. These acquisitions expanded the Company's income that is subject to United States taxes on fully consolidated companies. Consequently, the Company continues to record income tax benefit or expense and deferred tax assets or liabilities for the year ended December 31, 2024 and December 31, 2023, which were immaterial for both periods. Where required, the Company complies with income tax filings in its various jurisdictions of operations. As of December 31, 2024 and 2023, the Company is not subject to U.S. federal or foreign examinations by tax authorities for years before 2019. Restricted Common Share Awards Compensation cost of restricted share awards is measured using the grant date fair value of the Company's common shares, as quoted on the Nasdaq Capital Market, multiplied by the total number of shares granted with no forfeiture rate applied. Compensation cost is amortized according to the vesting period indicated in the grant agreement. Total compensation cost recognized during the years ended December 31, 2024 and 2023 is $ 2,788,190 a nd $ 2,087,807 , respectively, which is included in general and administrative expenses in the consolidated statements of income. Dividends Dividends on common stock are recorded when declared by the Board of Directors. While there are no specific restrictions at the parent company level, certain subsidiaries are subject to restrictions under credit agreements that may limit their ability to declare and distribute dividends to the parent company. For more information on common stock dividends, refer to Note 14, "Stock Incentive Plans and Non-controlling interest." Noncontrolling Interests Noncontrolling interests represent ownership interests attributable to third parties in certain consolidated subsidiaries and VIEs. The portion of equity not owned by us in such entities is reflected as Noncontrolling interests within the equity section of the Consolidated Balance Sheets and, in the case of Redeemable noncontrolling interests, within the long-term liabilities section of the Consolidated Balance Sheets. Earnings per Common Share Basic earnings per share ("EPS") is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted EPS is computed using the treasury stock method. Under this method, the amount of unrecognized compensation cost related to future services by employees who were awarded restricted shares is assumed to be used to repurchase common stock at the average market price during the period. The incremental shares (nonvested less repurchased) are considered to be outstanding for diluted EPS. The Company does not have any anti-Dilutive Securities. Foreign Exchange The Company conducts all of its business in U.S. dollars; the functional currency of the Company is the US dollar. Accordingly, transactions denominated in currencies other than the functional currency are measured and recorded in the functional currency at the exchange rate in effect on the date of the transactions. There are no foreign exchange transaction gains or losses reflected in the consolidated statements of income. 16 Derivatives and Hedging Activities The Company accounts for derivatives in accordance with the provisions of ASC 815, Derivatives and Hedging. The Company uses interest rate swaps to reduce market risks associated with its operations, principally changes in variable interest rates on its bank debt. Additionally, the Company uses forward freight agreements to protect against changes in charter rates and bunker (fuel) swaps to protect against changes in fuel prices. The Company’s interest rate swaps, forward freight agreements (FFAs) and bunker swaps have not qualified for hedge accounting treatment. As such, unrealized gains or losses are recognized as a component of Other expense in the Consolidated Statements of Income. Derivative instruments are measured at fair value and are recorded as assets or liabilities. The Company is exposed to credit loss in the event of nonperformance by the counterparty to the interest rate swaps, forward freight agreements and bunker hedges. Segment Reporting Operating segments are components of a business that engage in revenue-generating activities and incur expenses. Additionally, discrete financial information must be available for these segments. Their operating results are regularly reviewed by the chief operating decision maker ("CODM") to allocate resources and assess performance. Segment information is prepared on the same basis that our CEO, who is our Chief Operating Decision Maker ("CODM"), manages our segments, evaluates financial results, and makes key operating decisions. In accordance with ASC 280, the Company identified the following operating segments: one shipping operating segment and six terminal and stevedoring operating segments. The Company shipping segment is inclusive of ship owning and commercial management companies. The Company evaluated whether aggregation of identified operating segments was appropriate based on the nature of services provided, the type of customers served, methods of service delivery, and economic characteristics. Based on criteria, the Companies operating segments do not qualify for aggregations. Based on the reportable segment criteria in ASC 280, the Company determined the shipping operating segment is reportable. All other operating segments do not meet the quantitative thresholds for determining reportable segments. We have one reportable operating segment: the shipping segment. The Company believes this approach aligns with the objective and principles of segment reporting under ASC 280, ensuring that the reportable segment structure reflects how the business is managed and how financial performance is assessed. The Company will continue to monitor its operating segments and the criteria for aggregation to ensure compliance with ASC 280 and the appropriateness of its segment reporting. Fair Value of Financial Instruments The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and short-term debt approximate fair value due to the short-term maturities of these instruments. The carrying amount of the Company’s floating rate long-term debt approximates its fair value due to the variable interest rates associated with these related credit facilities. At December 31, 2024, the Company has eight fully fixed rate debt facilities. At December 31, 2023, the Company has nine fully fixed rate debt facilities. The aggregate carrying amounts and fair values of the long-term debt associated with the fixed rate borrowing arrangements are as follows: December 31, 2024 December 31, 2023 Carrying amount of fixed rate long-term debt, financing obligations, and finance leases $ 120,026,549 $ 111,847,339 Fair value of fixed rate long-term debt $ 113,339,208 $ 103,119,658 Fair values of these debt obligations were estimated based on quoted market prices for the same or similar issues of debt with the same remaining maturities, which is considered Level 2 in the fair value hierarchy established by ASC 820. 17 Leases During time charter agreements, the charterers have substantive decision-making rights to direct how and for what purpose the vessel is used. As such, the Company had identified that time charter agreements contain a lease. Accordingly, the Company accounts for amounts earned under these agreements in accordance with Topic 842. During time charter agreements, the Company is responsible for operating and maintaining the vessels. These costs are recorded as vessel operating expense in the Consolidated Statements of Income. The Company has elected the practical expedient that allows the Company to combine lease and non-lease components under ASC 842 as the timing and pattern of recognizing revenues for operating the vessel is the same as the timing and pattern of recognizing vessel leasing revenue; and the lease component, if accounted for separately, would be classified as an operating lease. At December 31, 2024, the Company had six vessels chartered to customers under time charters that contain leases. These six leases varied in original length from 35 days to 165 days . At December 31, 2024, lease payments due under these arrangements totaled approximately $ 2,389,000 and each of the time charters were due to be completed in one hundred four days or less. The company does not have any options to extend or terminate the leases. At December 31, 2023, the Company had ten vessels chartered to customers under time charters that contain leases. These ten leases varied in original length from 21 days to 180 days . At December 31, 2023, lease payments due under these arrangements totaled approximately $ 12,525,000 and each of the time charters were due to be completed in one hundred eighty days or less. The Company does not have any sales-type or direct financing leases. The Company does not have any vessels chartered in (operating leases) for longer than one year and the practical expedient relating to leases with terms of 12 months or less was elected. Furthermore, the Company's finance lease right of use assets and finance lease liabilities were referred to as "assets under finance lease" and "obligations under finance leases" in prior period financial statements, but no other changes resulted from adoption of the standard. In addition, the Company has four non-cancelable office leases and non-cancelable office equipment leases and the lease assets and liabilities are not material. Recent Accounting Standards The Company considers the applicability and impact of all accounting standard updates (“ASU”) issued by the Financial Accounting Standards Board (the “FASB”). ASUs not listed were assessed by the Company and either determined to be not applicable or expected to have minimal impact on its consolidated financial statements. Recently Adopted Accounting Standards As of January 1, 2023, we adopted ASU No. 2016-13, "Financial Instruments—Credit Losses" ("ASU 2016-13"). ASU 2016-13 amends the current financial instrument impairment model by requiring entities to use a forward-looking approach based on expected losses to estimate credit losses on certain types of financial instruments, including trade receivables. The adoption of the accounting standard, did not have any material impact on our consolidated financial statements. The Company adopted ASU No. 2020-04, ASU No. 2021-01, and ASU No. 2022-06 related to Reference Rate Reform (Topic 848). The adoption did not have a material impact on the Company’s consolidated financial statements or related disclosures." In November 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. This update expands the disclosure requirements for reportable segments by enhancing disclosures related to significant segment expenses, interim segment profit or loss, and segment assets. It also clarifies how the Chief Operating Decision Maker ("CODM") uses the reported segment profit or loss information to assess segment performance and allocate resources. The Company adopted ASU 2023-07 effective December 15, 2024, and determined that the application of this guidance did not have a material impact on its consolidated financial statements. For additional details on the adoption effects of ASU 2023-07, refer to Note 16. Recently Issued Accounting Standards Not Yet Adopted In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires disclosure of incremental income tax information related to the income tax rate reconciliation and expanded disclosures of income taxes paid, among other disclosure requirements. The update is effective for annual periods beginning 18 after December 15, 2024 on a prospective basis, and retrospective application is permitted. The Company is currently evaluating the impact of ASU 2023-09 on its disclosures within its consolidated financial statements. In November 2024, the FASB released ASU 2024-03, which focuses on Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. This update requires the disclosure of additional information regarding specific expense categories in the financial statement notes. It becomes effective for annual periods starting after December 15, 2026, and for interim periods starting after December 15, 2027, with early adoption permitted. The update can be applied either prospectively to financial statements issued for reporting periods after the effective date or retrospectively to any or all prior periods presented in the financial statements. The Company is currently assessing the impact of ASU 2024-03 on its disclosures in the consolidated financial statements. NOTE 4 - CASH AND CASH EQUIVALENTS Cash and cash equivalents include short-term deposits with an original maturity of less than three months. The following table provides a reconciliation of cash and cash equivalents reported within the consolidated balance sheets that sum to the total of the same amounts shown in the consolidated statement of cash flows: December 31, 2024 December 31, 2023 Money market accounts – cash equivalents $ 33,239,201 $ 38,556,005 Time deposit accounts - cash equivalents (1) 10,204,382 10,206,500 Cash (1) 43,361,887 50,275,361 Total cash and cash equivalents $ 86,805,470 $ 99,037,866 (1) It consists of cash deposits at various major banks. As of December 31, 2024 and December 31, 2023, we held cash and cash equivalents in the following subsidiaries: Cash and cash equivalents December 31, 2024 December 31, 2023 Pangaea (1) $ 73,909,070 $ 81,652,679 NBHC (2) 12,063,063 11,948,547 Deck Barge (3) 833,337 5,436,640 Total cash and cash equivalents $ 86,805,470 $ 99,037,866 (1) Held by 100 % owned Pangaea consolidated subsidiaries (2) Held by a 67 % owned Pangaea consolidated subsidiary (3) Held by a 50 % owned Pangaea consolidated subsidiary in 2024, the cash balance included $ 5,178,409 held by NBP, a subsidiary in which Pangaea had a 50 % equity ownership at December 31, 2023. NOTE 5 - VARIABLE INTEREST ENTITIES In compliance with ASC 810, the Company has assessed all its wholly and partially owned entities, in addition to those with common ownership or other connections. Note 3 outlines a brief of the Company's consolidation policy. As of December 31, 2024, the Company has identified the following variable interest entities (VIEs): Bulk Freedom, Bulk Pride, Bulk PODS, Bulk Spirit, Bulk Independence, Bulk Friendship, Bulk Courageous, Bulk Valor, Bulk Promise, Phoenix Bulk 25, Bulk Sachuest, Bulk Prudence, Bulk Brenton, Bulk Patience, NBV, Long Wharf, NBHC, BVH, NBP, FVL, VBC, VNLN, Pangaea Logistics Solutions (US) LLC, Renaissance Holdings LLC, Strategic Alliance, Strategic Equity, Strategic Explorer, Strategic Fortitude, Strategic Harmony, Strategic Synergy, Strategic Tenacity, Strategic Unity, Strategic Venture, Strategic Endeavor, Strategic Resolve, Strategic Vision, Strategic Entity, Strategic Spirit, and Strategic Savannah. Similarly, as of December 31, 2023, the identified VIEs are Bulk Trident, Bulk Phoenix, Bulk Freedom, Bulk Pride, Bulk PODS, Bulk Spirit, Bulk Independence, Bulk Friendship, Bulk Courageous, Bulk Valor, Bulk Promise, Phoenix Bulk 25, Bulk 19 Sachuest, Bulk Prudence, NBV, Long Wharf, NBHC, BVH, NBP, FVL, VBC, VNLN, and Pangaea Logistics Solutions (US) LLC. The Company consolidates a VIE when it holds a variable interest in the entity and is the primary beneficiary. This means the Company has (i) the authority to direct the activities that most significantly affect the VIE’s economic performance and (ii) the obligation to absorb losses or the right to receive benefits that could be significant to the VIE. The financial position and operating results of these VIEs are included in the consolidated financial statements. After eliminating any intercompany transactions and balances, the aggregate carrying values of the VIEs’ assets and liabilities in the consolidated balance sheets were as follows: (Dollars in millions, figures may not foot due to rounding) December 31, 2024 Ship-owning (1) NBHC NBV Long Wharf VLNL PANL US Total assets $ 373.5 $ 89.9 $ 42.9 $ 1.9 $ 0.9 $ 6.0 Total liabilities $ 365.7 $ 42.7 $ 23.6 $ 1.9 $ — $ 3.1 Total stockholders' (deficit)/equity $ 7.7 $ 47.2 $ 19.3 $ — $ 0.9 $ 2.9 Non-controlling interest (2) $ — $ 45.6 $ — $ — $ 1.2 $ — December 31, 2023 (Dollars in millions, figures may not foot due to rounding) Ship-owning (1) NBHC NBV Long Wharf VLNL NBP PANL US Total assets $ 100.3 $ 96.5 $ 53.3 $ 1.9 $ 0.6 $ 144.1 $ 3.2 Total liabilities $ 101.6 $ 50.4 $ 22.9 $ 1.9 $ 0.1 $ 135.6 $ 1.1 Total stockholders' (deficit)/equity $ ( 1.3 ) $ 46.2 $ 30.3 $ — $ 0.6 $ 8.5 $ 2.2 Non-controlling interest (2) $ — $ 45.3 $ — $ — $ 1.1 $ — $ — (1) Includes all wholly-owned subsidiaries, refer to Note 2 "Nature of Organization" for additional information. (2) Non-controlling interest is held by third parties. 20 NOTE 6 - FIXED ASSETS At December 31, fixed assets consisted of the following: 2024 2023 Vessels and vessel upgrades $ 830,920,933 $ 576,153,211 Capitalized dry docking 21,547,305 18,408,282 852,468,238 594,561,493 Accumulated depreciation and amortization ( 148,914,935 ) ( 124,477,977 ) Vessels, vessel upgrades and capitalized dry docking, net 703,553,303 470,083,516 Land and building 3,002,503 2,571,585 Computers, equipment and internal use software 4,307,577 4,147,346 Other fixed assets 7,310,080 6,718,931 Accumulated depreciation ( 3,037,055 ) ( 2,537,276 ) Other fixed assets, net 4,273,025 4,181,655 Total fixed assets, net $ 707,826,328 $ 474,265,171 At December 31, vessels under finance leases consisted of the following: 2024 2023 Vessels under finance lease $ 39,469,412 40,933,207 Accumulated depreciation and amortization ( 10,697,881 ) ( 10,539,384 ) Vessels under finance lease, net $ 28,771,531 $ 30,393,823 The net carrying value of the Company’s fleet consists of the following: December 31, 2024 2023 Owned vessels m/v NORDIC ODYSSEY (1) 17,181,472 18,949,524 m/v NORDIC ORION (1) 18,144,065 19,789,942 m/v NORDIC OSHIMA (1) 23,105,684 22,938,264 m/v NORDIC OLYMPIC (1) 22,089,187 23,306,330 m/v NORDIC ODIN (1) 21,979,872 23,411,836 m/v NORDIC OASIS (1) 23,436,017 24,853,935 m/v NORDIC NULUUJAAK (2) 34,667,055 36,088,312 m/v NORDIC QINNGUA (2) 34,654,787 36,018,502 m/v NORDIC SANNGIJUQ (2) 34,290,887 35,623,004 m/v NORDIC SIKU (2) 34,672,061 36,009,984 m/v BULK ENDURANCE 20,616,061 21,859,034 m/v BULK PRUDENCE 26,743,876 26,533,530 m/v BULK COURAGEOUS 16,027,958 15,145,246 m/v BULK CONCORD 18,510,983 18,965,726 m/v BULK FREEDOM 7,325,595 8,150,075 m/v BULK PRIDE 10,677,950 11,194,335 21 December 31, 2024 2023 Owned vessels m/v BULK SPIRIT 11,960,593 12,970,111 m/v BULK PATIENCE 28,239,587 — m/v BRENTON 28,256,449 — m/v BULK SACHUEST 15,677,788 16,487,253 m/v BULK INDEPENDENCE 12,622,265 13,752,517 m/v BULK FRIENDSHIP 11,956,736 12,810,712 m/v BULK VALOR 15,726,225 16,434,083 m/v BULK PROMISE 16,344,110 16,970,026 m/v STRATEGIC FORTITUDE 16,874,348 — m/v STRATEGIC RESOLVE 14,606,291 — m/v STRATEGIC EXPLORER 14,606,291 — m/v STRATEGIC ENTITY 14,606,291 — m/v STRATEGIC SYNERGY 14,061,957 — m/v STRATEGIC ALLIANCE 14,061,957 — m/v STRATEGIC UNITY 14,061,957 — m/v STRATEGIC HARMONY 14,061,957 — m/v STRATEGIC EQUITY 14,061,957 — m/v STRATEGIC VENTURE 14,061,957 — m/v STRATEGIC SAVANNAH 11,431,010 — m/v STRATEGIC SPIRIT 11,068,121 — m/v STRATEGIC VISION 11,068,121 — m/v STRATEGIC TENACITY 10,705,232 — m/v STRATEGIC ENDEAVOUR 7,711,396 — MISS NORA G. PEARL (3) 1,597,197 1,821,235 $ 703,553,303 $ 470,083,516 Other fixed assets, net 4,273,025 4,181,655 Total fixed assets, net $ 707,826,328 $ 474,265,171 Right of Use Assets Finance lease right of use assets: m/v BULK XAYMACA 11,042,061 11,623,719 m/v BULK DESTINY $ 17,729,470 $ 18,770,104 $ 28,771,531 $ 30,393,823 (1) Vessels are owned by NBHC, a consolidated joint venture in which the Company has a two-third ownership interest at December 31, 2024 and December 31, 2023. (2) Vessels are owned by NBP, a consolidated joint venture in which the Company has a 50 % ownership interest at December 31, 2023. On November 6, 2024, the Company acquired the remaining 50 % interest in NBP from a non-affiliate, resulting in full ownership of NBP's fleet of four Post Panamax Ice Class 1A dry bulk vessels at December 31, 2024. (3) Barge is owned by a 50 % owned consolidated subsidiary. The Company capitalized dry-docking costs on five vessels in 2024 and three vessels in 2023. The amortization period of the capitalized dry docking costs is within the remaining useful life of these vessels and is amortized over the estimated period to next drydocking. The 22 Company capitalized drydocking costs totaling $ 6.2 million and $ 4.2 million in the twelve months ended December 31, 2024 and 2023, respectively. These costs are recorded in Fixed assets, net or Finance lease right of use assets, net in the Consolidated Balance Sheets. 23 NOTE 7 - MARGIN ACCOUNTS, DERIVATIVES AND FAIR VALUE MEASURES Margin Accounts During December 31, 2024 and 2023, the Company was party to forward freight agreements and fuel swap contracts in order to mitigate the risk associated with volatile freight rates and fuel prices. Under the terms of these contracts, the Company is required to deposit funds in margin accounts if the market value of the hedged item declines. The funds are required to remain in margin accounts as collateral until the market value of the items being hedged return to preset limits. The margin accounts are included in advance hire, prepaid expenses and other current assets in the consolidated balance sheets at December 31, 2024 and 2023. Forward Freight Agreements The Company assesses risk associated with fluctuating future freight rates and, when appropriate, hedges identified economic risk with appropriate derivative instruments, specifically FFAs. These economic hedges do not usually qualify for hedge accounting under ASC 815 and as such, the usage of such derivatives can lead to fluctuations in the Company’s reported results from operations on a period-to-period basis. Fuel Derivatives The Company continuously monitors the market volatility associated with fuel prices and seeks to reduce the risk of such volatility through a fuel hedging program. The Company enters into fuel derivatives that are not designated for hedge accounting under ASC 815 and, as such, the usage of such derivatives can lead to fluctuations in the Company’s reported results from operations on a period-to-period basis. Interest rate cap The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish these objectives, the Company primarily uses interest rate swaps and interest rate caps as part of its interest rate risk management strategy. Interest rate caps designated as cash flow hedges involve the receipt of variable amounts from a counterparty if interest rates rise above the strike rate on the contract. In January 2020, the Company entered into four interest rate cap contracts with total notional amount of $ 108.42 million as of December 31, 2024 at a cost of $ 628,000 to mitigate the risk associated with increases in interest rates on our sale and lease back financing arrangements of the four new-building vessels. In the event that the three-month SOFR rate rises above the applicable strike rate of 3.51 %, the Company would receive quarterly payments related to the spread difference. These interest rate cap agreements do not qualify for hedge accounting treatment. The estimated fair values of the Company’s forward freight agreements and fuel swap contracts are based on market prices obtained from an independent third-party valuation specialist based on published indices. Such quotes represent the estimated amounts the Company would receive or pay to terminate the contracts. The interest rate caps contracts are valued using analysis obtained from independent third party valuation specialists based on market observable inputs, representing Level 2 assets. The following table summarizes assets and liabilities measured at fair value on a recurring basis at December 31, 2024 and December 31, 2023: Asset Derivative Liability Derivative Derivative instruments Balance Sheet Location 12/31/2024 12/31/2023 Balance Sheet Location 12/31/2024 12/31/2023 Margin accounts (1) Other current assets $ 3,268,455 $ 3,239,947 Other current liabilities $ — $ — Forward freight agreements (2) Other current assets $ — $ — Other current liabilities $ 1,045,395 $ 1,217,820 Fuel derivatives (2) Other current assets $ — $ — Other current liabilities $ 137,992 $ 523,233 Interest rate cap (2) Other current assets $ 1,873,430 $ 3,384,137 Other current liabilities $ — $ — F-24 (1) The fair value measurements were all categorized within Level 1 of the fair value hierarchy. (2) These fair value measurements were all categorized within Level 2 of the fair value hierarchy. The three levels of the fair value hierarchy established by ASC 820, Fair Value Measurements and Disclosures , in order of priority are as follows: Level 1 – Quoted prices in active markets for identical assets or liabilities. Our Level 1 fair value measurements include cash, money-market accounts and time deposit accounts. Level 2 – Quoted prices for similar assets and liabilities in active markets or inputs that are observable. Level 3 – Inputs that are unobservable (for example cash flow modeling inputs based on assumptions). Fair Value Measurements on a Recurring Basis as of December 31, 2024 and 2023: December 31, 2024 December 31, 2023 Derivative Instruments Total Fair Value Level 1 Level 2 Level 3 Total Fair Value Level 1 Level 2 Level 3 Asset Derivative: Margin accounts $ 3,268,455 $ 3,268,455 $ — $ — $ 3,239,947 $ 3,239,947 $ — $ — Forward freight agreements — — — — — — — — Fuel derivatives — — — — — — — — Interest rate cap 1,873,430 — 1,873,430 — 3,384,137 — 3,384,137 — Total Asset Derivatives 5,141,885 3,268,455 1,873,430 — 6,624,084 3,239,947 3,384,137 — Liability Derivative: Forward freight agreements 1,045,395 — 1,045,395 — 1,217,820 — 1,217,820 — Fuel derivatives 137,992 — 137,992 — 523,233 — 523,233 — Interest rate cap — — — — — — — — Total Liability Derivatives $ 1,183,387 $ — $ 1,183,387 $ — $ 1,741,053 $ — $ 1,741,053 $ — The following table presents the effect of our derivative financial instruments on the consolidated statements of operations for the twelve months ended December 31, 2024 and 2023: Unrealized gain (loss) on derivative instruments For the year ended December 31, Derivative instruments 2024 2023 Forward freight agreements $ 172,425 $ ( 1,053,033 ) Fuel derivatives 385,240 ( 364,307 ) Interest rate cap ( 1,510,707 ) ( 1,508,007 ) Total loss $ ( 953,042 ) $ ( 2,925,347 ) The estimated fair values of the Company’s forward freight agreements and fuel derivatives are based on market prices obtained from an independent third-party valuation specialist. Such quotes represent the estimated amounts the Company would receive to terminate the contracts. 25 NOTE 8 - RELATED PARTY TRANSACTIONS Amounts and notes payable to related parties consist of the following: December 31, 2023 Activity December 31, 2024 Included in Advance hire, prepaid expenses and other current assets on the consolidated balance sheets and statements of income, respectively: MTM Ship Management (“MTM”) (ii) $ — $ 3,789,859 $ 3,789,859 Included in accounts payable and accrued expenses on the consolidated balance sheets: Trade payables due to Seamar (i) $ 1,490,060 $ ( 309,045 ) $ 1,181,015 i. Seamar Management S.A. ("Seamar") Seamar Management S.A. ("Seamar") is a joint venture of which the Company owns 51 % at December 31, 2024 and 2023. ii. A member of the Board of Directors has partial ownership in MTM Ship Management. Under the terms of a technical management agreement between the Company and Seamar Management S.A. (Seamar), an equity method investee, Seamar is responsible for the day-to-day operation of some of the Company’s owned vessels. During the years ended December 31, 2024 and 2023, the Company incurred technical management fees of $ 3,250,200 and $ 3,093,000 under this arrangement, which is included in vessel operating expenses in the consolidated statements of income. The total amounts payable to Seamar at December 31, 2024 and 2023, (including amounts due for vessel operating expenses), were $ 1,181,015 and $ 1,490,060 , respectively. On December 30, 2024, the Company completed its merger with Strategic Shipping Inc. (SSI), a wholly owned subsidiary of Renaissance Holdings LLC. As part of the transaction, the Company entered into a Technical Management Agreement with MTM Ship Management (“MTM”), establishing MTM as the technical manager for certain vessels within the merged entity’s fleet. Under the agreement, MTM Ship Management provides technical management services, including vessel maintenance, crew management, procurement, and regulatory compliance. As of December 31, 2024, the Company had a prepaid balance amounting to $ 3,789,859 for continuous vessel management services rendered by MTM Ship Management. This sum is recorded under Prepaid Expenses on the consolidated balance sheet. 26 NOTE 9 - SECURED LONG-TERM DEBT AND FINANCING OBLIGATIONS As of December 31, 2024, the Company’s outstanding long-term debt consists of the following: December 31, 2024 December 31, 2023 Interest Rate (%) (1) Maturity Date Long-Term Debt Bulk Nordic Odyssey (MI) Corp., Bulk Nordic Orion (MI) Corp. Senior Secured Term Loan Facility (2) (3) $ 10,572,576 $ 12,512,080 2.95 % December 2027 Bulk Nordic Oshima (MI) Corp., Bulk Nordic Odin (MI) Corp., Bulk Nordic Olympic (MI) Corp., Bulk Nordic Oasis (MI) Corp. Secured Term Loan Facility (2) (3) 35,000,000 39,800,000 3.38 % June 2027 The Amended Senior Facility - Dated May 13, 2019 (formerly The Amended Senior Facility - Dated December 21, 2017) (4) – Bulk Nordic Six Ltd. - Tranche A (2) — 9,033,325 N/A May 2024 – Bulk Pride - Tranche C (2) — 1,900,000 N/A May 2024 – Bulk Independence - Tranche E (2) — 9,500,000 N/A May 2024 $ 50 Million Senior Secured Term Loan Facility - Dated August 14, 2024 (4) 46,966,266 — 6.99 % May 2029 Bulk Valor Corp. Loan and Security Agreement (2) 8,707,180 10,087,642 3.29 % June 2028 Bulk Promise Corp. (2) 8,301,038 9,685,334 5.45 % October 2027 Bulk Sachuest (2) 6,918,957 7,733,094 6.19 % October 2029 Bulk Prudence 14,853,000 — 6.53 % July 2029 Total Long-Term Debt $ 131,319,017 $ 100,251,475 Less: Unamortized Debt Issuance Costs ( 2,022,277 ) $ ( 1,053,440 ) $ 129,296,740 $ 99,198,035 Less: current portion ( 16,576,195 ) ( 30,751,726 ) Secured long-term debt, net $ 112,720,545 $ 68,446,309 (1) As of December 31, 2024. (2) Interest rates on the loan facilities are fixed. (3) The borrowers under this facility are owned by NBHC. The Company has two-third's ownership interest and STST has one-third ownership interest in NBHC. NBHC is consolidated in accordance with ASC 810-10 and as such, amounts pertaining to the non-controlling ownership held by the third parties in the financial position of NBHC are reported as non-controlling interest in the accompanying balance sheets. (4) This facility is secured by the vessels m/v Bulk Endurance, m/v Bulk Brenton, and Bulk Patience, and is guaranteed by the Company. All the loan terms and key financial covenants for all outstanding debt as of December 31, 2023, remain unchanged as of December 31, 2024. The Company was in compliance with all financial covenants as of December 31, 2024 and 2023. All outstanding loans are secured by the respective underlying assets. New Long-Term Debt Issued in 2024 During the year ended December 31, 2024, the Company entered into the following new long-term debt arrangements. Borrowings made prior to January 1, 2024, that remain outstanding as of December 31, 2024, including their terms, covenants, and repayment schedules. $ 50 Million Senior Secured Term Loan Facility On May 16, 2024, the Company entered into a $ 50 million Senior Secured Term Loan facility with a lender, providing committed funding for vessel acquisitions. The following drawdowns have been made under this facility, each with a maturity date of May 2029: 27 Initial Drawdown: On May 17, 2024, Bulk Endurance (MI) Corp., as the initial borrower, drew $ 17.6 million against the MV Bulk Endurance. The loan is repayable in quarterly installments of $ 413,145 , with a balloon payment of $ 9,337,089 due at maturity in May 2029. Interest is floating at the Secured Overnight Financing Rate (SOFR) plus 2.5 %. Second Drawdown: On July 19, 2024, Bulk Brenton (MI) Corp. drew $ 15.7 million to finance the MV Bulk Brenton, which was delivered on July 26, 2024. Repayment is structured in quarterly installments of $ 392,545 , with a final balloon payment of $ 8,216,654 due in May 2029. The interest rate is SOFR plus 2.5 %, consistent with the initial drawdown. Third Drawdown: On August 14, 2024, Bulk Patience (MI) Corp. drew $ 15.7 million for the MV Bulk Patience, delivered on August 20, 2024. This tranche is repayable in quarterly installments of $ 372,354 , with a balloon payment of $ 8,972,626 , also due in May 2029. The interest rate aligns with the prior tranches at SOFR plus 2.5 %. Following the third drawdown, the Company canceled the remaining undrawn amount under the facility. Key Financial Covenants: • Leverage Ratio: Maximum of 200 % consolidated leverage. • Debt Service Coverage Ratio: Minimum of 115 % on a rolling four-quarter basis. • Minimum Liquidity: At least $ 18 million in consolidated liquidity. • Net Worth: Minimum consolidated net worth of $ 52.25 million. • Borrower Liquidity: Minimum of $ 375,000 per vessel in the Borrower’s account at DNB Bank ASA. As of December 31, 2024, the Company is in compliance with all the financial covenants. $ 15.2 million Senior Secured Term Loan Facility On July 17, 2024, the Company entered into a $ 15.2 million Senior Secured Term Loan facility to finance the MV Bulk Prudence, an Ultramax Bulk Carrier. The loan is structured with quarterly installments of $ 347,000 and a final balloon payment of $ 8,607,000 due in July 2029. Interest on the loan is based on a floating rate at SOFR plus 1.90 %. Bulk Prudence Corp., a wholly-owned subsidiary of Pangaea Logistics Solutions Ltd., is the borrower, with Pangaea and affiliated entities acting as guarantors. Key Financial Covenants: • Leverage Ratio: Maximum of 200 % consolidated leverage. • Debt Service Coverage Ratio: Minimum of 115 % on a rolling four-quarter basis. • Minimum Liquidity: At least $ 18 million in consolidated liquidity. • Net Worth: Minimum consolidated net worth of $ 52.25 million. As of December 31, 2024, the Company is in compliance with all the financial covenants. Debt Repayments in 2024 Loans that matured and were fully repaid during the year are reflected in the maturity date of the table above. 28 The future minimum annual payments under the debt agreements are as follows: Years ending December 31, 2025 $ 16,576,196 2026 16,738,201 2027 46,055,191 2028 11,422,630 2029 40,526,799 Total $ 131,319,017 Less: Unamortized Debt Issuance Costs $ ( 2,022,277 ) $ 129,296,740 Less: current portion $ ( 16,576,195 ) Secured long-term debt, net $ 112,720,545 Financing Obligations Recognized in Failed Sale Leaseback Transactions The following vessels were acquired through failed sale-leaseback transactions and are accounted for as financing obligations. These transactions do not qualify as leases under ASC 842 because the Company retains control of the vessels and is contractually obligated to repurchase them. As of December 31, 2024, the Company’s financing obligation consists of the following: 29 December 31, 2024 December 31, 2023 Interest Rate (%) (1) Maturity Date Bulk Spirit Ltd. 6,346,354 7,486,979 5.10 % February 2027 Bulk Friendship Corp. - Bareboat Charter Agreement dated May 14, 2019 — 8,471,002 N/A September 2024 Bulk Friendship Corp. - Bareboat Charter Party dated September 30, 2024 7,800,000 — 6.90 % August 2029 Bulk Nordic Seven LLC (3) (4) 26,821,468 28,482,063 7.06 % May 2036 Bulk Nordic Eight LLC (3) (4) 26,813,297 28,473,392 7.06 % June 2036 Bulk Nordic Nine LLC (3) (4) 26,978,978 28,591,644 7.06 % September 2036 Bulk Nordic Ten LLC (3) (4) 27,105,743 28,712,632 7.06 % November 2036 Bulk Courageous Corp. (2) 7,800,000 9,000,000 3.93 % April 2028 Phoenix Bulk 25 Corp. (2) 10,468,772 12,097,410 4.67 % February 2029 Bulk Independence 8,500,000 — 6.85 % December 2028 Bulk Pride 8,500,000 — 6.85 % December 2028 Tripartite Agreement (m/v Strategic Alliance, m/v Strategic Synergy, Strategic Unity) (2) 30,640,920 — 5.54 % June 2029 SBC Entity LLC 10,441,619 — 5.49 % August 2031 SBC Explorer LLC 9,354,155 — 5.49 % March 2030 RHI Fortitude Pte. Ltd. 10,600,000 — 5.49 % January 2031 SBC Harmony Pte. Ltd. 10,960,000 — 5.49 % August 2031 RHI Savannah Pte. Ltd. 9,390,000 — 5.49 % September 2029 RHI Tenacity Pte. Ltd. (2) 9,438,688 — 2.31 % April 2027 SBC Venture Pte. Ltd. 9,223,910 — 5.49 % July 2031 Total $ 257,183,904 $ 151,315,122 Less: unamortized issuance costs, net ( 2,387,007 ) ( 2,296,899 ) 254,796,897 149,018,223 Less: current portion ( 25,267,105 ) ( 18,980,512 ) Financing Obligations, net $ 229,529,792 $ 130,037,711 (1) As of December 31, 2024 including the effect of interest rate cap if any. (2) Interest rates on the loan facilities are fixed. (3) The Company entered into an interest rate cap effective from Q2 2026 through Q4 2026, which caps the SOFR at 3.51 %. (4) 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, which previously held interests in the financing obligations for these vessels. All the obligation terms and financial covenants for all outstanding financing obligations as of December 31, 2023, remain unchanged as of December 31, 2024. The Company was in compliance with all financial covenants as of December 31, 2024 and 2023. All outstanding financing obligations are secured by the respective underlying assets. New Financing Obligations in 2024 During the year ended December 31, 2024, the Company entered into the following new financing obligations. Financing obligations recognized prior to January 1, 2024, that remain outstanding as of December 31, 2024, including their terms, payment schedules. 30 Bulk Friendship Corp. Bareboat Charter Party dated September 30, 2024 In September 2024, Bulk Friendship Corp. entered into a sale and leaseback arrangement for $ 8.0 million. Under ASC 606, the transaction did not qualify as a sale, as control of the vessel was not transferred to the counterparty. Consequently, the transaction is classified as a financing obligation in accordance with ASC 842, due to the inclusion of a fixed-price purchase option, which the Company expects to exercise. The minimum payments consist of a fixed component of $ 50,000 per month and a floating component based on one-month SOFR plus a margin of 1.9 %. The Company has the option to purchase the vessel after the 18th month or at any point upon counterparty default. If not exercised earlier, a final purchase option allows the Company to acquire the vessel at the end of the five-year term for $ 5.0 million. Bulk Independence Corp. Bareboat Charter Party dated December 2024 In December 2024, Bulk Independence Corp. entered into a sale and leaseback transaction for the m.v. Bulk Independence as part of an $ 8.5 million financing arrangement with a lender. Under ASC 606, the transaction did not qualify as a sale since control of the vessel was not transferred to the lessor. As such, the transaction is not accounted for as a lease under ASC 842. Instead, it is classified as a financing obligation due to the inclusion of a fixed-price purchase option that the Company intends to exercise. The financing arrangement includes a bareboat charter agreement, which grants the Company full operational control of the vessel. The minimum payments consist of a fixed monthly amount and a floating component based on the one-month SOFR plus a 1.85 % margin. The Company has the option to purchase the vessel at specified intervals during the term, including an early purchase option after a defined period and a final purchase option of $ 2.5 million at the conclusion of the term. Additionally, the agreement comprises a Mortgage, Bareboat Charter and Guarantee Assignment, and Insurance Assignment, under which the Owner has assigned all rights under the Bareboat Charter to the lender. Bulk Pride Corp. Bareboat Charter Party dated December 2024 In December 2024, Bulk Pride Corp. entered into a sale and leaseback transaction for the m.v. Bulk Pride as part of an $ 8.5 million financing arrangement with a lender. Under ASC 606, the transaction did not qualify as a sale since control of the vessel was not transferred to the lessor. As such, the transaction is not accounted as a lease under ASC 842. Instead, it is classified as a financing obligation due to the inclusion of a fixed-price purchase option that the Company intends to exercise. The financing arrangement includes a bareboat charter agreement, granting the Company full operational control of the vessel. The minimum payments consist of a fixed monthly amount and a floating component based on the one-month SOFR plus a 1.85 % margin. The Company has the option to purchase the vessel at predetermined intervals throughout the financing arrangement, including an early purchase option after a defined period and a final purchase option of $ 2.5 million at the conclusion of the financing term. Additionally, the agreement comprises a Mortgage, Bareboat Charter and Guarantee Assignment, and Insurance Assignment, under which the Owner has assigned all rights under the Bareboat Charter to the lender. Renaissance Holdings LLC On December 30, 2024, the Company finalized the acquisition of fifteen handy-size dry bulk vessels from Strategic Shipping Inc. (“SSI”) and integrated them into its fleet. In line with the transaction, and pursuant to the Agreement and Plan of Merger among the Company, SSI, Renaissance Holdings LLC (a fully-owned subsidiary of SSI), and Renaissance Merger Sub LLC (a fully-owned subsidiary of the Company), the Company took on finance obligation liabilities amounting to $ 100,049,293 . 31 The table below outlines the assumed finance obligations: Balance as of 12/31/2024 Interest Rate Maturity Date Tripartite Agreement (m/v Strategic Alliance, m/v Strategic Synergy, Strategic Unity) (2) $ 30,640,920 2.05 % + Fixed rate 3.47 % June 2029 SBC Entity LLC 10,441,619 2.00 % + floating 1M SOFR August 2031 SBC Explorer LLC 9,354,155 2.00 % + floating 1M SOFR March 2030 RHI Fortitude Pte. Ltd. 10,600,000 2.00 % + floating 1M SOFR January 2031 SBC Harmony Pte. Ltd. 10,960,000 2.10 % + floating 1M SOFR August 2031 RHI Savannah Pte. Ltd. 9,390,000 2.00 % + floating 1M SOFR September 2029 RHI Tenacity Pte. Ltd. (2) 9,438,688 Fixed interest rate 2.31 % April 2027 SBC Venture Pte. Ltd. 9,223,910 2.10 % + floating 1M SOFR July 2031 Total $ 100,049,292 All contracts previously classified as leases are accounted for as financing obligations under ASC 842 due to the inclusion of fixed-price purchase commitments at the end of the contract terms. Since these contracts do not qualify for lease accounting treatment, they are recognized as financing arrangements from the inception of the agreements. The financing obligations are secured by the assignment of earnings and insurances related to the underlying assets, as well as a Company guarantee. Interest expense associated with these financing obligations is recognized using the effective interest method over the term of the contract. The following table presents the schedule of future minimum payments for the financing obligations: Year ending December 31, 2025 $ 42,003,321 2026 40,989,851 2027 48,611,690 2028 43,711,389 2029 56,257,108 Thereafter 115,659,176 Total Present Value of Minimum Payments 347,232,535 Less: Amount representing interest ( 90,048,631 ) Present value of minimum payments 257,183,904 Less: Issuance costs ( 2,387,007 ) Present value of minimum payments, net 254,796,897 Less: Current portion of financing obligations ( 25,267,105 ) Non-current portion of financing obligations $ 229,529,792 32 NOTE 10 - FINANCE LEASES At December 31, 2024, the Company's fleet includes two vessels (Bulk Xaymaca, Bulk Destiny) financed under sale and leaseback financing arrangements accounted for as finance leases in accordance with ASC 840. Finance lease consists of the following as of December 31, 2024: December 31, 2024 December 31, 2023 Interest Rate (%) (1) Maturity Date Bulk PODS Ltd. $ 2,919,270 $ 4,763,020 7.33 % December 2027 Bulk Nordic Five Ltd. (2) 10,450,000 11,595,861 3.97 % April 2028 Total $ 13,369,270 $ 16,358,881 Less: unamortized issuance costs, net ( 91,222 ) ( 140,113 ) $ 13,278,048 $ 16,218,768 Less: current portion ( 2,843,750 ) ( 2,989,612 ) Secured long-term debt, net $ 10,434,298 $ 13,229,156 (1) Interest rates on the loan facilities are fixed. No amendments or modifications to the outstanding finance leases listed in the table above occurred during the year 2024. All outstanding finance leases are secured by the respective underlying assets. Future minimum lease payments under finance leases with initial or remaining terms in excess of one year at December 31, 2024 were: Year ending December 31, 2025 $ 3,558,294 2026 2,553,912 2027 1,320,923 2028 7,595,976 Total minimum lease payments $ 15,029,105 Less amount representing interest 1,659,835 Present value of minimum lease payments 13,369,270 Less current portion ( 2,843,750 ) Less issuance costs ( 91,222 ) Long-term portion $ 10,434,298 NOTE 11 - OTHER LONG-TERM LIABILITIES 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. NBP was established for the purpose of constructing and owning four new-build ice class post Panamax vessels. The third party has committed to contribute additional funding during the construction phase, which increased their ownership of NBP to 50 % at the time of delivery of the new-build ice class post Panamax vessels. The agreement contains both put and call option provisions. Accordingly, the Company may be obligated, pursuant to the put option, or entitled to, pursuant to the call option, to purchase the third party's interest in NBP beginning anytime after September 2026. The put option and call option are at fixed prices which are not significantly different from each other, starting at $ 4.0 million per vessel on the fourth anniversary from completion and delivery of each vessel and declining to $ 3.7 million per vessel on or after the seventh anniversary from completion and delivery of each vessel. If neither put nor call option is exercised, the Company is obligated to purchase the vessels from NBP at a fixed price. Pursuant to ASC 480, Distinguishing Liabilities from Equity, the Company has recorded the third party's interest in NBP as a Long term liabilities - Other. The Company took delivery of Nordic Nuluujaak, Nordic Qinngua, Nordic Sanngijuq and Nordic Siku during the second quarter through fourth quarters of 2021, the independent third party made additional contribution of $ 9.2 million which 33 increased their ownership interest in NBP to 50 % at December 31, 2021. As of December 31, 2023, the independent third party retains a 50 % ownership interest in NBP. Earnings attributable to the third party’s interest in NBP are recorded in Interest expense, non-controlling interest. 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, which previously held interests in the financing obligations for Nordic Nuluujaak, Nordic Qinngua, Nordic Sanngijuq and Nordic Siku. Following the acquisition, the Company recognized a $ 1,963,602 early debt extinguishment charge, recorded under interest expense in the consolidated income statement for the year ended December 31, 2024. The components of Other Long-term Liabilities are as follows: 12/31/2024 12/31/2023 Beginning Balance $ 17,936,540 $ 19,974,390 Payments to non-controlling interest recorded as long-term liability ( 21,039,558 ) ( 2,500,000 ) Earnings attributable to non-controlling interest recorded as interest expense 3,103,018 462,150 Ending balance $ — $ 17,936,540 NOTE 12 - COMMITMENTS AND CONTINGENCIES Long-term Contracts Accounted for as Operating Leases The Company leases office space for its Copenhagen operations. The lease expires in December 2025, at which time the lease continues on a month to month basis with a non-cancelable period of six months . The Company leases office space for its Singapore operations. In July 2023, the Company renewed its lease for a two year period. At December 31, 2024, the remaining lease term is eight months . For the twelve months ended December 31, 2024 and 2023, the Company recognized approximately $ 0.2 million as lease expense for office leases in General and Administrative Expenses. Legal Proceedings and Claims The Company is subject to certain asserted claims arising in the ordinary course of business. The Company intends to vigorously assert its rights and defend itself in any litigation that may arise from such claims. While the ultimate outcome of these matters could affect the results of operations of any one year, and while there can be no assurance with respect thereto, management believes that after final disposition, any financial impact to the Company would not be material to its consolidated financial position, results of operations, or cash flows. NOTE 13 - NET INCOME PER COMMON SHARE The computation of basic net income per share is based on the weighted average number of common stock outstanding for the year ended December 31, 2024 and 2023. Diluted net income per share gives effect to restricted stock awards. 34 The following table summarizes the calculation of basic and diluted income per share: For the Years Ended December 31, 2024 December 31, 2023 Net income $ 28,903,383 $ 26,323,300 Weighted Average Shares - Basic 45,391,855 44,773,899 Dilutive effect of restricted stock awards 654,189 701,554 Weighted Average Shares - Diluted 46,046,044 45,475,453 Basic net income per share $ 0.64 $ 0.59 Diluted net income per share $ 0.63 $ 0.58 There are no other shares which could be potentially dilutive. NOTE 14 - STOCK INCENTIVE PLANS AND NON-CONTROLLING INTEREST Common stock The Company has 100,000,000 shares of common stock ($ 0.0001 par value) authorized, of which 64,961,433 were issued as of December 31, 2024. Restricted Securities On August 8, 2024, the Company's shareholders approved an amendment and restatement of the 2024 Plan that was adopted by the Board on May 7, 2024. The PANGAEA LOGISTICS SOLUTIONS LTD. 2024 SHARE INCENTIVE PLAN (as amended and restated by the Board of Directors on May 7, 2024), (the "Amended Plan"), the aggregate number of common shares with respect to which awards may be granted under the Amended Plan, such that the total number of shares made available for grant is 6,200,000 . As of December 31, 2024, there were 926,531 common shares available for grants of awards under the 2014 Incentive Plan. At December 31, 2024, shares issued to employees under the Amended Plan totaled 3,930,432 after forfeitures. These restricted shares vest at the rate of one-third of the total granted on each of the third, fourth and fifth anniversaries of the vesting commencement date. The Company is amortizing these grants over the applicable vesting periods. The Company has elected to recognize forfeitures as they occur. Total non-cash compensation cost recognized during the years ended December 31, 2024 and 2023 is $ 2,788,190 and $ 2,087,807 , respectively, which is included in general and administrative expenses in the consolidated statements of operations. A summary of activity related to outstanding restricted securities for fiscal years 2024 and 2023 is presented in the table below: Restricted Shares Weighted-Average Grant-Date Fair Value Per Share Unvested shares at December 31, 2022 1,367,310 $ 3.07 Granted 607,111 $ 5.53 Vested ( 536,593 ) $ 3.45 Forfeited ( 14,168 ) $ 3.04 Unvested shares at December 31, 2023 1,423,660 $ 3.97 Granted 435,469 $ 7.70 Vested ( 546,822 ) $ 3.81 Forfeited — Unvested shares at December 31, 2024 1,312,307 $ 5.27 35 Fiscal Years Ended December 31, 2024 2023 Fair value of restricted shares vested $ 2,992,891 $ 3,014,568 Unrecognized compensation cost for restricted shares $ 4,248,433 $ 3,685,460 Weighted average remaining period to expense restricted shares (years) 2.80 3.33 Dividends Dividends payable consist of the following: Dividends payable (1) Balance at December 31, 2022 $ 626,178 Accrued dividend 668,536 Paid in cash ( 148,393 ) Balance at December 31, 2023 1,146,321 Accrued dividend 627,244 Paid in cash ( 562,574 ) Balance at December 31, 2024 $ 1,210,991 (1) Accrued dividends on unvested restricted shares under the Company's incentive compensation plan. While there are no specific restrictions at the parent company level, certain subsidiaries are subject to restrictions under credit agreements that may limit their ability to declare and distribute dividends to the parent company. These restrictions do not prevent the parent company from declaring and paying dividends on its common stock. Dividends During 2024 and 2023, the quarterly cash dividend was $ 0.10 per share, respectively. The Company paid a quarterly cash dividend ranging from $ 0.035 to $ 0.10 per common share commencing in May 2019 and expects to maintain its quarterly dividend of $ 0.10 per share throughout 2025. Future dividends will depend on the Company’s earnings, capital requirements, financial condition and other factors considered relevant by the Board. Noncontrolling Interests Amounts pertaining to the non-controlling ownership interest held by third parties in the financial position and operating results of the Company’s subsidiaries and/or consolidated VIEs are reported as non-controlling interest in the accompanying consolidated balance sheets. The non-controlling ownership interest attributable to NBHC and its wholly-owned ship-owning subsidiaries amounts to approximately $ 45,608,000 and $ 45,252,000 as of December 31, 2024 and 2023, respectively. Non-controlling interest attributable to VLNL was approximately $ 1,235,000 and $ 1,058,000 at December 31, 2024 and 2023, respectively. Equity in Earnings and Dividends from Unconsolidated Subsidiaries: For the year ended December 31, 2024, and 2023, the Company recognized $ 1,427,530 and $ 761,485 , respectively, as equity in earnings from its 50% or less owned investees accounted for using the equity method. Additionally, the Company received $ 1,910,000 and $ 1,637,500 in dividends from these investees for the years ended December 31, 2024 and 2023, respectively, disclosed under the other income line item in the consolidated income statement. NOTE 15 - ACQUISITIONS 36 Merger Agreement with Strategic Shipping Inc. On December 30, 2024 (the “Closing Date”), Pangaea Logistics Solutions Ltd. acquired fifteen handy-size dry bulk vessels (“Renaissance Vessels”) from Strategic Shipping Inc. (SSI) through the Merger Agreement with SSI. Renaissance Holdings LLC, a subsidiary of SSI (“Renaissance”), merged into Renaissance Merger Sub LLC, a subsidiary of Pangaea, after which the separate existence of Merger Sub ceased, and Renaissance became a wholly-owned subsidiary of the Company (the “Merger”). Prior to the Closing of the Merger, SSI effected a reorganization pursuant to which the ownership interests of certain of SSI’s subsidiaries (the “Subsidiaries”) were transferred and/or contributed to Renaissance. After the completion of the Reorganization, the Subsidiaries of Renaissance owned or chartered-in all Renaissance Vessels. In connection with the Merger, the Company issued 18,059,342 shares of its common stock to SSI, representing approximately 27.6 % of the Company’s outstanding common stock post-transaction, and assumed $ 100 million in loans and lease liabilities related to the Renaissance Vessels. At the Closing Date, the Company also remitted to SSI $ 6.8 million in cash (the “Closing Adjustment”), estimated based on the terms of the Merger Agreement, which includes primarily the carrying value of the bunker inventories and unused lubricants, prepaid principal and interest on the loans assumed by the Company, and was reduced by the estimated profit from the voyages in progress at the Closing Date. The Company’s shareholders approved the share issuance in accordance with Nasdaq rules. The issued shares were exempt from registration under the Securities Act of 1933. The Company and SSI also entered into an Investor and Registration Rights Agreement, granting SSI resale registration rights and the right to designate up to two members on the Company’s Board of Directors. Following the guidelines of ASC 805, Business Combinations (“ASC 805”), the Merger was determined not to meet the requirements of a business combination. As of the Closing Date, over 90 % of the estimated fair value of Renaissance’s total assets acquired, were comprised of similar vessels with similar risk characteristics and inventories on board these vessels. As a result, the Merger was accounted for as an acquisition of Renaissance by the Company under the asset acquisition method of accounting in accordance with U.S. GAAP, which values the acquired assets and liabilities at the cost of the acquisition, including transaction costs, on the basis of their relative fair values. The Company was treated as the acquirer for accounting purposes. The total purchase consideration of $ 202.9 million, which consists of $ 91.0 million related to the fair value of the common stock issued to SSI, 100.0 million in assumed liabilities at their fair value, $ 9.2 million related to the Closing Adjustment and $ 2.7 million in acquisition costs, was allocated to the assets acquired based on their relative fair values at the time of acquisition. The Company measured the fair value of the shares issued as consideration in the acquisition of the assets based on the stock price at the Closing Date. The Closing Adjustment allocated to the purchased assets excluded the estimated profit from the voyages in progress at the Closing date and to be completed post-closing. This estimated profit totaling $ 2.4 million was recorded as deferred revenue. When determining the fair value of tangible assets acquired, the Company estimated the cost to replace Renaissance Vessels with a new asset, taking into consideration such factors as age, condition and the economic useful life of the asset. The fair value of the bunker and lube inventories was determined based on the market price per metric ton. Transaction costs directly related to the acquisition of the assets have been capitalized. The total consideration was preliminarily allocated on a relative fair value basis to the assets acquired, as follows (in millions): (in millions) December 30, 2024 Renaissance Vessels $ 197,048,841 Bunkers and lube inventories 5,588,193 Prepaid expenses 289,459 Total assets $ 202,926,493 Assumed loans and lease liabilities $ 100,049,292 Fair value of the common stock issued 91,019,086 Cash consideration related to the Closing Adjustment 9,179,747 Transaction costs 2,678,368 Total consideration $ 202,926,493 37 Acquisition of Port and Terminal Operation. On March 24, 2023, the Company signed a Members Interest Purchase Agreement for the acquisition of marine port terminal operations for a purchase price of $ 7.2 million. On June 1, 2023, the Company completed the acquisition for a total purchase price of $ 9.3 million including acquired net working capital. Under the terms of the agreement, Pangaea acquired all onshore assets, licenses and business operations related to the sellers terminal operation. This acquisition aims to enhance our logistics capabilities and aligns with our strategic objective of catering to customers beyond the realm of maritime transportation. The following table summarizes the preliminary allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed: Net working capital, excluding cash $ 1,772,889 Property, plant and equipment 1,844,100 Goodwill 3,104,800 Other intangible assets 2,251,100 Fair value of net assets acquired, excluding cash and cash equivalents 8,972,889 Cash and cash equivalents 326,888 Fair value of net assets acquired $ 9,299,777 NOTE 16 – SEGMENT REPORTING The Company's shipping segment focuses on providing seaborne dry bulk logistics and transportation services. This segment's goal is to generate both current income and capital appreciation through voyage and time charter agreements. Vessels that are owned or chartered by the Company operate globally, resulting in voyage and charter revenues from various geographic regions. The CEO, acting as the Chief Operating Decision Maker (CODM), assesses profitability and asset performance using Time Charter Equivalent (TCE) rates. The primary expense analyzed by the CODM is voyage expenses, which are reported separately in the Consolidated Statements of Income. 38 The following tables present selected financial information with respect to our reportable segment: December 31, 2024 December 31, 2023 Shipping segment Voyage revenue $ 493,439,058 $ 467,573,493 Charter revenue 30,326,291 23,715,895 Shipping segment total revenue 523,765,349 491,289,388 Reconciliation: All other revenue (1) 12,770,897 7,978,446 Total consolidated revenue $ 536,536,246 $ 499,267,834 December 31, 2024 December 31, 2023 Shipping segment total revenue $ 523,765,349 $ 491,289,388 Less: Voyage expense 237,478,669 227,434,670 TCE revenue (2) 286,286,680 263,854,718 Other operating expenses 237,838,066 219,237,521 Other expenses ( 16,679,121 ) ( 16,079,425 ) Total consolidated net income $ 31,769,493 $ 28,537,772 (1) All other revenue includes revenue from our port and terminal operations, as well as other ancillary services. (2) TCE revenue represents shipping segment total revenue less voyage expenses and is considered the segment measure of profit/loss. At the end of the years December 31, 2024, and December 31, 2023, the Company recorded net other operating expenses of $ 237.84 million and $ 219.24 million , respectively. These expenses include all other revenue, vessel operating costs, charter hire expenses, general and administrative costs, and depreciation and amortization. Additionally, other expenses totaled $ 16.68 million and $ 16.08 million for the years ended December 31, 2024, and December 31, 2023, respectively, primarily comprising interest expenses and other non-operating costs. For the year ended December 31, 2024, the Company reported total consolidated net income of $ 31.77 million and $ 28.54 million for the prior year. 1 Geographical Disclosure Revenue from external customers is attributed to geographic areas as follows: Revenue: December 31, 2024 December 31, 2023 United States $ 169,382,692 $ 142,246,632 Canada 72,820,447 74,496,107 Germany 44,129,597 23,855,953 Singapore 39,422,507 26,892,281 United Kingdom 35,535,921 58,507,173 Other (1) 175,245,081 173,269,688 Total consolidated revenue $ 536,536,246 $ 499,267,834 (1) This includes revenue from various regions across Asia, Europe, South America, and other international markets. Revenue is presented geographically based on the customer's country of domicile. For the year ended December 31, 2024, one customer accounted for 10 % or more of total revenue. For the year ended December 31, 2023, two customers accounted for 10 % or more of total revenue. The Company’s vessels regularly move between countries in international waters, over hundreds of trade routes and, as a result, the disclosure of geographic information is impracticable. Other segment disclosures: December 31, 2024 December 31, 2023 Shipping Other Total Shipping Other Total Interest expense 17,073,184 — 17,073,184 17,025,547 — 17,025,547 Depreciation and amortization (1) 30,041,771 333,950 30,375,721 29,513,633 556,762 30,070,395 Other non-recurring items — — — 1,738,511 — 1,738,511 Segment assets 730,727,634 205,729,447 936,457,081 498,656,103 206,523,865 705,179,968 The Company incurred Capital expenditures of $260,996,761 and $31,418,327 for shipping segment assets for the years ended December 31, 2024 and 2023, respectively. NOTE 17 - SUBSEQUENT EVENTS On February 13, 2025, the Company's Board of Directors declared a quarterly cash dividend of $ 0.10 per common share, to be paid on March 14, 2024, to all shareholders of record as of February 28, 2025. 2 SIGNATURES Pursuant to the requirements of the Section 13 or 15 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on March 17, 2025. PANGAEA LOGISTICS SOLUTIONS LTD. By: /s/ Mark L. Filanowski Mark L. Filanowski Chief Executive Officer (Principal Executive Officer) By: /s/ Gianni Del Signore Gianni Del Signore Chief Financial Officer (Principal Financial and Accounting Officer) 1 POWER OF ATTORNEY Each person whose signature appears below constitutes and appoints Mark L. Filanowski and Gianni DelSignore and each of them, as attorney-in-fact with full power of substitution and re-substitution, for him or her and in his or her name, place or stead, in any and all capacities, to sign any and all amendments to this annual report on Form 10-K, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, as amended, this annual report on Form 10-K has been signed by the following persons in the capacities and on the dates indicated. Signature Title Date /s/ Mark L. Filanowski Chief Executive Officer and Director March 17, 2025 Mark L. Filanowski (Principal Executive Officer) /s/ Gianni DelSignore Chief Financial Officer, Principal March 17, 2025 Gianni DelSignore Financial and Accounting Officer /s/ Carl Claus Boggild Director March 17, 2025 Carl Claus Boggild /s/ Richard T. du Moulin Chairman of the Board, Director March 17, 2025 Richard T. du Moulin /s/ Anthony Laura Director March 17, 2025 Anthony Laura /s/ Eric S. Rosenfeld Director March 17, 2025 Eric S. Rosenfeld /s/ David D. Sgro Director March 17, 2025 David D. Sgro /s/ Karen H. Beachy Director March 17, 2025 Karen H. Beachy /s/ Christina Tan Director March 17, 2025 Christina Tan /s/ Gary Vogel Director March 17, 2025 Gary Vogel 2 Exhibit no. Description 3.1 Certificate of Incorporation of the Company, as amended (incorporated by reference to Exhibit 3.1 of the Registrant's Current Report on Form S-1 filed on February 4, 2015). 3.2 Bye-laws of Company (incorporated by reference to Exhibit 3.2 of the Registrant's Current Report on Form S-1 filed on February 4, 2015.) 10.1 Purchase Agreement Addendum by and between Bulk Nordic Five Ltd. and Nicole Navigation S.A. dated October 27, 2016 (incorporated by reference to Exhibit 10.34 of the Registrant's Current Report on Form 10-K filed on March 22, 2017). 10.2 Bareboat Charter Party Dated August 2, 2018 (incorporated by reference to Exhibit 10.43 of the Registrant's Current Report on Form 10-Q filed on November 8, 2018). 10.3 Bareboat Charter Party Dated February 21, 2019 (incorporated by reference to Exhibit 10.44 of the Registrant's Current Report on Form 10-Q filed on May 15, 2019). 10.4 Limited Liability Company Agreement of Nordic Bulk Partners LLC. (incorporated by reference to Exhibit 10.18 of the Registrant's Current Report on Form 10-K filed on March 23, 2020). 10.5 Bareboat Charter Party Dated September 27, 2019 (incorporated by reference to Exhibit 10.19 of Registrant's Current Report on Form 10-K filed on March 23, 2020). 10.6 Bulk Nordic Odyssey (MI) Corp., Bulk Nordic Orion (MI) Corp. Senior Secured Term Loan Facility (incorporated by reference to Exhibit 10.19 of Registrant's Current Report on Form 10-K filed on March 23, 2020). 10.7 Bulk Courageous Bareboat Charter dated March 27, 2021 (incorporated by reference to Exhibit 10.1 of Registrant's Current Report on Form 10-Q filed on August 10, 2021). 10.8 Bulk Valor Corp. Loan and Security Agreement dated as of June 17, 2021 (incorporated by reference to Exhibit 10.2 of Registrant's Current Report on Form 10-Q filed on August 10, 2021). 10.9 Bulk Nordic Five Ltd. Amendment and Restatement Agreement of Bareboat Charter dated July 1, 2021 (incorporated by reference to Exhibit 10.1 of Registrant's Current Report on Form 10-Q filed on November 9, 2021). 10.10 Bulk Promise Corp. Loan and Security Agreement dated as of July 7, 2021 (incorporated by reference to Exhibit 10.2 of Registrant's Current Report on Form 10-Q filed on November 9, 2021). 10.11 Bareboat Charter Party by and between Phoenix Bulk 25 Corp. and Delta Partner Ltd Dated January 27, 2022 (incorporated by reference to Exhibit 10.1of Registrant's Current Report on Form 10-Q filed on May 10, 2022). 10.12 Bulk Sachuest Corp. Loan and Security Agreement dated as of October 13, 2022 (incorporated by reference to Exhibit 10.17 of Registrant's Current Report on Form 10-K dated March 15, 2022). 10.14 $50 Million Senior Secured Term Loan Facility 10.15 Bulk Prudence Corp. Facility Agreement Loan Facility 10.16 Agreement and Plan of Merger (incorporated by reference to Exhibit 2.1 of Registrant's Current Report on Form 8-K filed on September 24, 2024) 10.17 Investor and Registration Right Agreement * 14.1 Code of Ethics * 19.1 Pangaea Logistics Solutions Ltd. Insider Trading Policy.* 21.1 Subsidiaries of Pangaea Logistics Solutions Ltd.* 23.1 Consent of Grant Thornton LLP. * 31.1 Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002* 31.2 Certification of Principal Financial and Accounting Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002* 32.1 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002* 32.2 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002* 97.1 Policy Relating to Recovery of Erroneously Awarded Compensation (incorporated by reference to Exhibit 97.1 of Registrant's Current Report on Form 10-K dated March 14, 2024) 101.INS XBRL Instance Document* 101.SCH XBRL Taxonomy Extension Schema* 101.CAL XBRL Taxonomy Extension Calculation Linkbase* 101.DEF XBRL Taxonomy Extension Definition Linkbase* 101.LAB XBRL Taxonomy Extension Label Linkbase* 101.PRE XBRL Taxonomy Extension Presentation Linkbase* 104 Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) * Filed herewith 3